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California’s SB9 Bill explained—A Property Owner’s Guide

The new Senate Bill 9, first introduced by Governor Gavin Newsom in September 2021, has come into effect this month.

As one of the most widely discussed and most controversial housing bills of recent years, it’s designed to facilitate residential construction across California and help reduce our ever-growing housing shortage.

SB9 means local agencies are legally bound to consider projects proposing to split lots and create multiple units on what would otherwise be zoned for a single family dwelling.

It’s known as the “duplex bill”—but we believe it would be better termed a “fourplex bill”!

Why?

Well, SB9 allows for lots to be split in two. In addition, it allows for a two-unit project on each of these new lots, resulting in four dwellings on a formerly single-family residential lot. This is all done with only ministerial approval, without time-consuming discretionary reviews and public hearings.

Anyone looking at planning approvals or purchases in and around residential zones should definitely consider this new potential. To help, here’s an overview of what SB9 allows, as well as the qualifying criteria and zoning standards in place.

Let’s get started.

What is SB9 and why is it needed?

The fight to solve California’s housing crisis is in full gear.

The three California senate bills (SB 8, 9, 10) aim to make it easier to build new homes in the state. In addition to this, they are designed to increase residential density and improve the city zoning options for construction of multi-family housing.

We’ve already taken an in-depth look at these new California zoning laws and project requirements as well as how Letter Four can help homeowners. So please take a few minutes to explore this if you’re considering your own development.

Across America, over 75% of residential land is currently single-family zoning. The federal government has recognized how restrictive zoning policies widen existing wealth gaps as well as damage upward mobility—especially for younger generations. It effectively prohibits lower-cost homes in affluent neighborhoods boasting leafy parks, good schools and job opportunities.

SB9 untangles much of the red tape surrounding home construction in California. With the state’s rising population (fueled by explosive job growth in tech centers such as Silicon Valley), new construction is needed more than ever before.

Despite this, there’s been significant not in my backyard pushback against SB9. Some homeowners are worried the historic charm of low-rise, tree-lined neighborhoods will be destroyed forever. Even with significant financial gains (as property owners can create up to four dwellings on their existing plot), issues such as speculative development and low-quality, unattractive builds are common concerns.

To deal with this, there are stringent regulations on qualifying projects and applicants. For instance, to prevent unscrupulous development, you must use one of the units as your primary residence for at least three years.

It’s worthwhile exploring these qualifying criteria in a little more detail.

Firstly, let’s take a look at the new “by-right” urban lot splits…

By-right urban lot splits

Under SB9, local agencies are legally bound to approve certain lot subdivisions ministerially.

This should be done without additional steps such as discretionary reviews or public hearings, but only if the following criteria apply:

• Each new lot is at least 1,200 square feet.
• The new lots are of roughly equal size (a 60/40 split minimum).
• The split doesn’t necessitate the demolition of affordable or rent-controlled housing, or properties occupied by tenants in the last three years.
• The lot is located in a single-family residential zone.
• The lot isn’t a historic landmark or within a designated historic district.
• The lot is within a city with urbanized areas or clusters, or within an urbanized area or urban cluster itself.
• The original lot wasn’t created by an SB9 lot split.
• The owner hasn’t previously subdivided adjacent lots through SB9.

Urban lot splits: objective zoning standards

In addition to these qualifying criteria for the lot itself, there are also objective zoning standards that need to be met. Under SB9, local agencies are able to impose objective subdivisions and design standards on eligible projects.

These can’t prevent the construction of two units (of at least 800 square feet) but do include several important considerations for property owners.

The objective zoning standards include:

• Parking: local agencies can require one off-street parking space per unit, only if it isn’t in close proximity to transit or car sharing hubs.
• Setbacks: side and rear setbacks may be imposed, except for existing structures (or projects constructed to exactly the same dimensions as the original home).
• Residential use: non-residential use of the new lots is prohibited.
• Three-year occupancy: owners must occupy one of the housing units for at least three years after approval.

Local agencies cannot:

• Prohibit connected structures: local agencies can’t refuse proposed adjacent or connected structures.
• Require dedications: local agencies can’t necessitate any right-of-way dedications or construction of off-site improvements.
• Nonconformities: local agencies can’t require correction of non-confirming zoning conditions.
• Limited denials: local agencies can’t deny a qualifying SB9 project unless it has a specific negative impact on public health and safety and there are no feasible mitigations.

By-right two-unit developments

The second major part of SB9 centers on approvals for two-unit development projects.

In addition to the by-right urban lot splits, local agencies must allow for two-unit developments on these new lots. This includes building two new units or simply adding one additional unit.

In both of these cases, projects need to be ministerially approved without discretionary reviews or hearings—saving property owners significant amounts of time and hassle.

To qualify for “by-right” two-unit developments, the criteria are very similar to those for the initial lot-split. These include:

• The project is located in a single-family residential zone.
• It is within an urbanized area or cluster (or a city containing such areas).
• It doesn’t involve the removal of tenanted, affordable or rent-controlled housing.
• It doesn’t involve demolition of more than 25% of exterior walls (of the existing dwelling)—unless specifically allowed by the local agency, or not tenant-occupied for the last three years.
• The site isn’t within a historic district or a historic landmark itself.

Two-unit developments: objective zoning standards

Similarly to SB9 lot splits, local agencies can only impose objective zoning, design and subdivision standards on eligible projects.

Again, there are strict rules governing these zoning standards. The main prohibitions include:

• Short-term rentals: Short-term rentals are prohibited in residences created under SB9.
• Accessory dwelling units: When lots are created through SB9 lot-splits (and developed through two-unit developments), local agencies don’t have to approve additional ADUs or JADUs.
• Coastal acts: Whilst the California Environmental Quality Act does not apply, the Coastal Act does—which determines the conservation of coastal resources and areas.

By enabling simpler and quicker lot splits and unit developments, SB9 allows California property owners to maximize the potential of their property. Letter Four’s Design-Build process is perfectly placed to help with this; reducing risks and lessening the costs involved in creating truly amazing homes.

Tentative subdivision maps

In addition to by-right lot splits and unit developments, SB9 also impacts local subdivision maps…

What is a tentative subdivision map?

Each local agency has their own specific processes and requirements for submitting a tentative map. A tentative map is generally required for property subdivisions, showing the existing conditions of a property as well as parcel lines. This includes aspects such as boundaries, topography, easements and utilities currently serving the property.

Tentative maps also demonstrate newly proposed configurations, grading and drainage plans, as well as proposed roadways, utility locations and how the property owner will deliver utility services to each lot.

As anyone who’s been through the process knows—this can be quite the undertaking!

How does SB9 help?

Under SB9, the lifespan of tentative subdivision maps has been extended. They are now generally valid for up to two years after approval. For projects requiring substantial public improvement obligations, this has been extended to four years.

The Letter Four Design-Build process assists homeowners through every stage of their development. With initial phases including research and due diligence, conceptual design and pricing, schematic and construction design documents, you can seek planning permits and approvals with confidence. We’ll even liaise with planning departments on your behalf – so there’s one less thing to worry about.

In summary

With SB9, California homeowners can make the most of their property’s potential. The three main aspects are:

• By-right lot splits—local agencies must adopt objective zoning standards to allow for ministerially approved lot splits, providing certain qualifying criteria are met.
• By-right two-unit developments—local agencies must also allow for ministerially approved two-unit developments, without the need for discretionary reviews or hearings.
• Tentative subdivision maps—the expiry for tentative subdivision maps has been extended, meaning they are typically valid for up to two years.

Letter Four is a full-service architectural design and construction firm based in California. Our founders, Lauren and Jeremy, have a whole host of architectural and construction experience.

Together with our expert team, they design and build inspiring spaces for commercial and residential clients alike. If you’re planning a development in light of the new SB9 regulations, get in touch today. Let’s turn your dreams into reality.

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