Jan. 19, 2017
AB 2501: Update to Density Bonus Law
Makes a number of changes to the State Density Bonus Law. By David Blackwell and Tim Hutter
David H. Blackwell
Allen Matkins Leck Gamble Mallory & Natsis LLPlitigation, real property
Three Embarcadero Center
San Francisco , CA 94111
Email: dblackwell@allenmatkins.com
U Utah College of Law
Tim Hutter
Allen MatkinsPhone: (619) 233-1155
Fax: (619) 233-1158
Email: thutter@allenmatkins.com
UCLA Law School
In September, Gov. Jerry Brown signed four bills relating to the construction of affordable and market-rate housing. The most prominent, Assembly Bill 2501, makes a number of changes to the State Density Bonus Law (DBL), Gov. Code Sections 65915, 65915.5.
The DBL, enacted in 1979, requires cities and counties to grant a density bonus for additional market-rate units, concessions and incentives, prescribed parking requirements, as well as waivers of development standards upon a developer's request when the developer includes a certain percentage of affordable housing in a housing development project.
Local agencies have always been required to comply with the DBL, but AB 2501 now requires the agencies to provide for expeditious processing of density bonus applications by (A) adopting procedures and timelines, (B) providing applicants with a list of documents and information required for a density bonus application to be deemed complete, and (C) notifying applicants when applications are complete consistent with the Permit Streamlining Act. See new Gov. Code Section 65915(a)(3). Local governments are also prohibited from requiring the preparation of an additional report or study in order to review or approve a density bonus application, but may require reasonable documentation to establish eligibility for a requested density bonus, incentives, concessions, waivers, or reduced parking ratios, and the eligibility standards for incentives and concessions have been modified slightly. Gov. Code Sections 65915(a)(2), (k).
In recent years, local governments have faced challenges relating to the calculation of project densities under the DBL. Specifically, many local governments have asserted a right to "round down" when the calculation of base density for a given parcel would result in a fractional number. Developers pointed to Section 65915(f)(5) as direct evidence that the Legislature intended for all calculations to be rounded up, but local policies varied. New Section 65915(q) makes clear that "each component of any density calculation, including base density and bonus density, resulting in fractional units shall be separately rounded up to the next whole number. The Legislature finds and declares that this provision is declaratory of existing law."
Finally, AB 2501 also makes clear that developers of density bonus projects may choose to accept no increase in density yet still be eligible to receive incentives and development standard waivers. Gov. Code Section 65915(f).
Although several affordable housing and by-right development proposals stalled last summer, AB 2501 should aid developers of projects that qualify under the DBL by providing better guidance and timelines for the approval process. According to the author of the bill, providing greater clarity and certainty is critical in order for the DBL to generate more affordable units, and AB 2501 adds subdivision (r) to reiterate that the DBL "shall be interpreted liberally in favor of producing the maximum number of total housing units."
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