Senate Bill 375 is alternately being described as the most important land use legislation since the California Coastal Act of 1976, and a step in the right direction.
Only time will tell whether the bill is a landmark or an incremental step, but there is no denying that SB 375 author Sen. Darrell Steinberg (D-Sacramento) aimed high. "At the heart of this effort," Steinberg said, "is the need to integrate our housing and transportation plans to create sustainable communities."
Steinberg's bill was by far the most significant land use legislation approved during the two-year legislative session that concluded on August 31.
The collection of interest groups that endorsed SB 375 was remarkable: The California Building Industry Association, the California Major Builders Council, the League of Conservation Voters, the Trust for Public Land, the League of California Cities, the California State Association of Counties, the California Chapter, American Planning Association (CCAPA), and the Congress for the New Urbanism all endorsed the bill. Affordable housing advocates held out for a long time before eventually offering tepid support. The Schwarzenegger administration has not taken a public position on the bill, but the governor is expected to sign it.
The legislation — which applies within the state's 17 metropolitan planning organizations — was the product of numerous, prolonged meetings spread over nearly a year. The final product is a very long, complex measure that addresses a variety of related topics. The primary parts of the measure are these:
• A regional greenhouse gas reduction/transportation planning process that results in a "sustainable communities strategy" for the region.
• California Environmental Quality Act (CEQA) streamlining for development projects consistent with the sustainable communities strategy, including a CEQA exemption for some infill housing projects with an affordable component.
• A mandate that transportation projects consistent with the sustainable communities strategy receive state funding.
• Alignment of the regional housing needs allocation (RHNA) and regional transportation plan (RTP) processes. The RHNA cycle will be eight years, while RTPs will be updated every four.
The regional planning process calls for a regional advisory committee and local agencies to work with the California Air Resources Board (CARB) on setting greenhouse gas (GHG) reduction targets for each of the 17 regions. The target, over which CARB has final say, is intended to provide the basis for the sustainable communities strategy. Those regions that cannot meet their GHG targets through a sustainability strategy must prepare an alternative planning strategy that demonstrates how targets might be reached. The RHNA figures developed by the state Department of Housing and Community Development (HCD) and by councils of government are supposed to account for a region's sustainable communities strategy. General plans, however, do not have to be consistent with the regional strategy — a provision demanded by local government.
As for CEQA, the measure exempts certain "transit priority projects." These have a density of at least 20 housing units per acre, are within a half-mile of a transit corridor, are smaller than eight acres and 200 units, provide at least 20% of units as affordable or set aside a certain amount of open space, comply with green building standards and are located on sites with no significant environmental constraints. While the exemption might prove limited, streamlining is available for other projects. A mixed-use project that is consistent with the sustainable communities plan would not have to undergo analysis of greenhouse gas emissions, cumulative traffic impacts or growth-inducing impacts, and a reduced density alternative would not be required. In addition, local agencies may adopt a standard set of traffic mitigation measures for projects that are at least 10 units per acre and 75% residential. Qualifying projects would not have to provide any other traffic mitigation.
The legislation extends the housing element planning period from five years to eight. The council of government would distribute RHNA numbers at the very beginning of the planning period, which is also when the RTP and sustainable communities planning periods commence. Cities and counties must submit their housing elements to HCD no more than one year into the planning period, and they then have three years to complete all rezoning required by the housing element.
Transportation projects and programs must be consistent with the sustainable communities strategy to be eligible for state funding sources. However, projects programmed in the State Transportation Improvement Program through 2011 are exempt from this consistency requirement, as are projects and programs in any local sales tax program approved by voters before 2011.
"This is the bill that moves toward looking at land use as a regional issue," said Pete Parkinson, CCAPA's vice president of policy and legislation, and one of SB 375's negotiators. The bill achieves the regional perspective by targeting greenhouse gas emissions from the transportation sector, he said. And, indeed, one clear goal of the bill is to reduce the amount of driving that Californians do by emphasizing mixed-uses, higher densities and transit.
"We definitely think it's progress for the state," said Ken Kirkey, planning director for the Association of Bay Area Governments (ABAG). "And it's definitely progress for parts of the state that have not moved as far and as fast on linking up transportation with land use."
Kirkey noted that ABAG began moving in this direction in 2002, when it produced policy-based projections for housing growth based on transit service and available infill sites.
Still, ABAG's working relationship with the Metropolitan Transportation Commission (MTC), which produces the Bay Area's RTP, has been tense at times. (In most regions other than the Bay Area, a council of governments serves as both the MPO and regional transportation planning agency.) Under SB 375, ABAG and the MTC will have to work together, Parkinson said.
Success, however, requires money, said Kirkey. City officials often understand the need for development of "complete communities," but they need money to carry out plans, he said.
"The state needs to get much more consistent with how money is spent and where money is spent in relationship to SB 375," Kirkey said.
Jeff Loux, director of the land use and natural resources program at University of California, Davis, endorsed the concept of regional sustainability planning. However, without a requirement that city and county general plans comply with the sustainable communities plan and the regional transportation plan, there is nothing that prevents local governments from approving the wrong type of development, he said. This has been the case with the Sacramento Council of Governments' blueprint, Loux said. Denser projects in the inner ring have the endorsement of the blueprint, but the document is unable to prevent ongoing large-lot sprawl on the urban edge, he said.
In 2007, Steinberg included growth management techniques in the bill, such as guaranteed protection for certain resource lands. The author dropped many of those provisions to gain support from the development industry.
Steinberg's bill met stiff opposition in the Assembly, which provided the final arena for opponents such as the California Chamber of Commerce, the California Association of Realtors and the California Association of the Councils of Governments to try to defeat the legislation. The opponents found allies in Republican lawmakers who defended the status quo, decried state intrusion and questioned climate change.
"This bill changes the way land use planning is done," complained Assemblyman Bob Huff (R-Diamond Bar). "If you don't believe in smart growth, you are not going to get any funding. … Suburban communities that are built out are going to be left out of this type of planning."
Assemblyman Michael Duvall (R-Yorba Linda) said the only way to comply with SB 375 would be to shift funding from highways to public transit. "It simply makes no sense to shift more money to transit programs when nobody uses it," he said. "The voters want to build more highways. Now's not the time to take money away."
Assemblyman Rick Keene (R-Chico) charged that SB 375 permits CARB to make land use decisions "superseding local government almost completely."
"This is a monumental change in course," Keene said. "I think that the locals are better at making these decisions than they [the CARB board] are."
But SB 375 defenders said that local government organizations would not have endorsed the measure if local officials believed the state was superseding local land use authority. Plus, Assemblyman Marc DeSaulnier (D-Martinez), who shepherded SB 375 through the Assembly, noted that 5 of 11 members of CARB are local elected officials, as are all MPO board members.
"The era of dollar-a gallon gasoline … of planning the way we have in the past, that era has passed," DeSaulnier said.
The bill ended up passing the Assembly 49-22, with several Republicans casting "aye" votes. Among them was Assemblyman Guy Houston (R-San Ramon), who endorsed the legislation's "first of its kind CEQA reform." The bill, he said, "will result in housing built in a timely manner."
Will SB 375 usher in a new era? Parkinson, of the state APA, said no one should expect immediate results. "It's probably going to take a couple cycles to work itself through," he said of the system devised by SB 375. "The question is going to be whether people have the patience for that."
2008 Land Use Legislation Summary
• AB 2230 (LaMalfa). Would have revised exemptions for the payment of CEQA filing fees to fund Department of Fish and Game reviews. Failed in Assembly committee.
• SB 1165 (Kuehl). Would have required recirculation of any EIR that is more than five years old when a project relies on the EIR, and increased public access to preliminary draft EIRs. Failed in Senate.
• SB 1210 (Dutton). Would have created a "short form" environmental study process for certain projects in urban areas. Failed in Senate committee.
Fees and revenues
• AB 938 (Calderon). Would have created a stormwater management process whose programs could be funded by user fees. Stalled in Senate.
• AB 1221 (Ma). Permits local officials to use property tax increment to finance bonds for infrastructure within transit village development districts. Approved by the Legislature.
• AB 1709 (Hancock). Authorizes the use of Mello-Roos financing for energy efficiency and renewable energy improvements. Approved.
• AB 1836 (Feuer). Would have authorized city councils and boards of supervisors to create infrastructure finance districts without voter approval to issue bonds and divert tax increment to retire the debt. Stalled in Senate committee.
• AB 2173 (Caballero). Makes it easier for school districts to impose "Level II" fees on new development. Approved.
• AB 2218 (Gaines). Would have altered procedures for Proposition 218 fee elections. Stalled in Senate committee.
• SCA 12 (Torlakson). Would have exempted stormwater and urban runoff management fees from Proposition 218 vote requirements. Stalled in Senate.
• SB 974 (Lowenthal). Imposes a fee on cargo containers going through ports in Long Beach, Los Angeles and Oakland to fund infrastructure and mitigate air pollution. Approved.
• SB 1335 (Negrete-McLeod). Eliminates the voter approval requirement for the City of Colton to establish an infrastructure finance district in the Agua Mansa Enterprise Zone and issue bonds. Approved.
• SB 1617 (Kehoe). Would have authorized the state to levy a $50 annual fee on dwellings located in an area served by the California Department of Forestry and Fire Protection. Dropped by author.
• AB 1129 (Arambula). Changes state grant criteria so that housing trust funds in counties of less than 425,000 people can better compete for funding. Approved.
• AB 2000 (Mendoza). Allows a city or county that exceeds production of its fair-share housing allocation to count the excess against subsequent fair-share requirements. Approved.
• AB 2069 (Jones). Tightens no-net-loss restrictions to prevent the loss of potential housing sites in cases where a local government approves commercial development on a site zoned for mixed uses. The governor vetoed a similar bill in 2007. Approved.
• AB 2280 (Saldaña). Clarifies recent changes to the density bonus law. Approved.
• SB 668 (Torlakson). Would have exempted housing built on school property from seismic safety standards that apply to schools. Stalled in Assembly committee.
• SB 900 (Corbett). Proposed repealing a Subdivision Map Act provision exempting from local government approval the conversion of a mobile home park to resident ownership. Stalled in Assembly committee.
• SB 1065 (Correa). Allows cities and counties to use revenue bonds to refinance mortgages on owner-occupied homes for households earning up to 150% of median income. Approved.
• SB 1299 (Migden). Would have permitted local governments to require that demolished rent-controlled units be replaced on the same parcel or elsewhere. Stalled in Assembly committee.
• AB 842 (Jones). Provides preference for Proposition 1C funds for transit-oriented development to entities with local or regional plans that reduce the growth in vehicle miles traveled by 10%. Approved.
• AB 1756 (Caballero). Proposed creating the Office of Local Public-Private Partnerships within the Business, Transportation and Housing Agency. Failed in Assembly committee.
• AB 1850 (Devore). Proposed creating the Office of Public-Private Partnerships within the governor's office. Failed in Assembly committee.
• AB 1968 (Jeffries). Would have authorized the governor to expedite construction of new highways and additional lanes in certain situations. Stalled in Assembly committee.
• AB 2005 (Jeffries). Would have authorized the transfer of state parks to local government. Stalled in Assembly committee.
• SB 863 (Yee). A last-minute bill that allocates $10 million from a Proposition 1C fund for parks that serve new housing to the City of Half Moon Bay to help settle a lawsuit won by an aggrieved developer. Could become part of state budget.
Local and regional planning
• AB 724 (Benoit). Would have increased local government's authority to regulate the siting and operation of "sober living homes." Stalled in Senate committee.
• AB 2093 (Jones). Would have required general plans to contain policies to reduce greenhouse gas emissions. Failed in Senate committee.
• AB 2182 (Caballero). Proposed a sustainable communities program within the Office of Planning and Research for the purpose of allocating $90 million in planning grants and incentives contained in Proposition 84. Gutted, amended and died.
• AB 2219 (Parra). Would have modified the proof of water requirement for large subdivisions by permitting a city or county to count water demand management measures against a subdivision's water need. Dropped by author.
• AB 2447 (Jones). Prohibits a county from approving a subdivision in a very high fire hazard severity zone or in an area where the state provides fire protection unless the county and responsible fire agency make specific findings about fire safety and emergency services. Approved.
• AB 2921 (Laird). Amends the procedures for rescinding Williamson Act contracts and for addressing contract breaches. Approved.
• SB 732 (Steinberg). Creates the Sustainable Communities Council to coordinate state programs and allocate Proposition 84 monies to fund sustainable community planning.
• SB 1185 (Lowenthal). Extends the expiration date of tentative subdivision maps by 12 months. Signed by the governor.
• AB 1088 (Carter). Would have ensured that an exemption from statutory timelines remains in place for redevelopment projects at the former Norton and George Air Force bases in San Bernardino County. Gutted and amended.
• AB 1941 (Carter). Would have authorized a city, county, housing authority or redevelopment agency to convey surplus land to a developer for any use consistent with a redevelopment plan and a general plan. Stalled in Assembly committee.
• AB 2097 (Coto). Allows use of housing set-aside funds in Santa Clara County for supportive services for extremely low-income households. Approved.
• AB 2509 (Galgiani). Proposed a homeownership preservation mortgage guarantee fund in the state treasury. Stalled in Senate committee.
• AB 2594 (Mullin). Authorizes redevelopment agencies to use non-housing tax increment revenue to refinance or assume subprime loans at risk of default. Agencies may also acquire vacant, foreclosed homes. Approved.
• SB 1103 (Cedillo). Would have required a city, county or redevelopment agency to disclose specific information before approving an economic development incentive. Gutted and amended to address workers' compensation.
• SB 1689 (Lowenthal). Requires the Department of Housing and Community Development to submit its redevelopment audits and investigations to the attorney general and state controller for potential enforcement action. Approved.