Existing law, the Office to Housing Conversion Act, starting July 1, 2026, deems an adaptive reuse project, as defined, a use by right in all zones, regardless of the zoning of the site, and subject to a streamlined, ministerial review process, if the project meets specified requirements. Existing law authorizes a local government to adopt an ordinance implementing the act and specifying the process and requirements applicable to adaptive reuse projects. If a local agency does not adopt an above-described ordinance, existing law requires the local agency to ministerially, without discretionary review, approve or disapprove applications for a permit to create or serve an adaptive reuse project, as specified. Existing law, the authorizes a city or county, or city and county, commencing in the 2026–27 fiscal year, to establish an adaptive reuse investment incentive program. If a city or county, or city and county, establishes that program, existing law requires, upon approval of the governing body, the city or county, or city and county, to pay adaptive reuse investment incentive funds to the proponent of a qualified adaptive reuse project property, approved pursuant to the streamlined, ministerial process described above, to subsidize the affordable housing required under the Office to Housing Conversion Act, as specified. Existing law defines "qualified adaptive reuse project property" to mean an adaptive reuse project proposed pursuant to the Office to Housing Conversion Act that is located within the city or county. This bill would expand the definition of qualified adaptive reuse project property to include adaptive reuse projects that fall under the Office to Housing Conversion Act regardless of compliance with affordability criteria or labor standards specified in that Act, thereby expanding payment of adaptive reuse investment incentive funds to certain adaptive reuse projects that do not have the requisite affordability or labor standards as specified in the Act, as provided. The bill would also expand the requirement on those cities, counties, and cities and counties to pay adaptive reuse investment incentive funds to the proponent to, in addition to subsidizing affordable housing units, subsidize the project's housing units. Existing law authorizes a city or special district to pay to the city or county, or city and county, an amount equal to the amount of ad valorem property tax revenue allocated to that city or special district, but not the actual allocation, derived from the taxation of that portion of the total assessed value of that real property that is in excess of the property's valuation at the time of the proponent's initial request for funding, for the purpose of subsidizing the affordable housing units required pursuant to the Office to Housing Conversion Act. This bill would expand the authorization for a city or special district to pay to the city or county, or city and county, as described above, for the purpose of subsidizing the project's housing units.
Under the Planning and Zoning Law, the legislative body of a county or city may adopt ordinances that, among other things, regulate the use of buildings, structures, and land, as provided. The Subdivision Map Act vests the authority to regulate and control the design and improvement of subdivisions in the legislative body of a local agency and sets forth procedures governing the local agency's processing, approval, conditional approval or disapproval, and filing of tentative, final, and parcel maps. Existing law requires a local agency to consider ministerially a specified proposed housing development or to ministerially approve a parcel map for an urban lot split if the development or parcel meets specified requirements, including, that the development or parcel is not located within a historic district or property included on the State Historic Resources Inventory or within a site that is designated or listed as a city or county landmark or historic property or district pursuant to city or county ordinance, as specified. Existing law authorizes a local agency to impose specified objective standards on the development or parcel created by an urban lot split, except as specified. With respect to ministerial review of a proposed housing development under the above-described provisions, this bill would, if the other specified requirements are met, instead require a local agency to consider ministerially the development that is not located in either a contributing structure within a historic district included on the State Historical Resources Inventory or within a historic property or district pursuant to city or county ordinance or in a parcel individually listed as a historical resource included in the State Historical Resources Inventory or within a property individually designated or listed as a city or county landmark under a city or county ordinance. The bill would also authorize a local agency to adopt objective standards for the purposes of maintaining the historical value of a historic district listed in the California Register of Historical Resources, as specified. With respect to an urban lot split under the above-described provisions, this bill would, if the other specified requirements are met, instead require a local agency to ministerially approve the urban lot split if the parcel is not located within a historic landmark property included on the State Historical Resources Inventory or within a site that is designated or listed as a city or county landmark pursuant to a city or county ordinance. The bill would additionally require that the proposed urban lot split not require demolition or alteration of specified structures. By imposing additional duties on local agencies, this bill would impose a state-mandated local program. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason.
(1) Existing law, the Planning and Zoning Law, requires each county and city to adopt a comprehensive, long-term general plan for its physical development, and the development of certain lands outside its boundaries, that includes, among other mandatory elements, a housing element. That law allows a development proponent to submit an application for a development that is subject to a specified streamlined, ministerial approval process not subject to a conditional use permit, if the development satisfies certain objective planning standards, including that the development is a multifamily housing development that contains two or more residential units. This bill would deem an adaptive reuse project a use by right in all zones, regardless of the zoning of the site, and subject to a streamlined, ministerial review process if the project meets specified requirements, subject to specified exceptions. In this regard, an adaptive reuse project, in order to qualify for the streamlined, ministerial review process, would be required to be proposed for an existing building or structure that is less than 50 years old or meets certain requirements regarding the preservation of historic resources, including the signing of an affidavit declaring that the project will comply with the United States Secretary of the Interior's Standards for Rehabilitation for, among other things, the preservation of exterior facades of a building or structure that face a street, or receive federal or state historic rehabilitation tax credits, as specified. The bill would require an adaptive reuse project to meet specified affordability criteria. In this regard, the bill would require an adaptive reuse project for rental housing to include either 8% of the unit for very low income households and 5% of the units for extremely low income households or 15% of the units for lower income households. For an adaptive reuse project for owner-occupied housing, the bill would require the development to offer either 30% of the units at an affordable housing cost to moderate-income households or 15% of the units at an affordable housing cost to lower income households. For an adaptive reuse project including mixed uses, the bill would require at least one-half of the square footage of the adaptive reuse project to be dedicated to residential uses. The bill would prohibit an adaptive reuse project from being permitted in industrial zones that do not permit residential uses. The bill would provide, among other things relating to projects involving adaptive reuse, that parking is not required for the portion of a project consisting of a building subject to adaptive reuse that does not have existing onsite parking. The bill would authorize an adaptive reuse project subject to these provisions to include the development of new residential or mixed-use structures on undeveloped areas and parking areas located on the same parcel as the proposed repurposed building, or on the parcels adjacent to the proposed adaptive reuse project site if certain conditions are met. The bill would subject an adaptive reuse project approved by a local government pursuant to these provisions to specified labor standards, including certain labor prevailing wage, apprenticeship, skilled and training workforce, and health care expenditure requirements, and would require development proponents to certify compliance with certain labor standards under penalty of perjury. By requiring certain development proponents of an adaptive reuse project to sign an affidavit regarding the preservation of historic resources and requiring development proponents to certify compliance with certain labor standards under penalty of perjury, the bill would expand the crime of perjury and therefore impose a state-mandated local program. The bill would authorize a local government to adopt an ordinance, as specified, to, among other things, specify the process and requirements applicable to adaptive reuse projects, as specified, and would require an adaptive reuse project to comply with all objective planning standards found in the ordinance. The bill would specify that nothing in its provisions relating to adaptive reuse projects is intended to preempt the adoption and implementation of a local ordinance that provides alternative procedures and substantive requirements for adaptive reuse projects, provided that the local ordinance does not prohibit an applicant from electing to pursue an adaptive reuse project, as specified. The bill would require a local agency that has not adopted an above-described ordinance to ministerially without discretionary review approve or disapprove applications for a permit to create or serve an adaptive reuse project, as specified. The bill would, if a local government's planning director or equivalent position determines that the adaptive reuse project submitted pursuant to these provisions is consistent with the objective planning standards, require the local government to approve the adaptive reuse project within specified timeframes. The bill would require the local government staff or relevant local planning and permitting department, upon determining that the adaptive reuse project is in conflict with any of the objective planning standards, to provide the proponent written documentation of, among other things, which standard or standards the development conflicts with within specific timeframes. The bill would prohibit a local government from imposing any local development standard on any project that is an adaptive reuse that would require alteration of the existing building envelope, except as specified, whether or not the local government has adopted an ordinance. By requiring local governments to implement the streamlined, ministerial review process for adaptive reuse projects, the bill would impose a state-mandated local program. This bill would, except as specified, exempt an adaptive reuse project from all impact fees that are not reasonably related to the impacts resulting from the change of use of the site from nonresidential to residential or mixed use and would require any fees charged to be roughly proportional to the difference in impacts caused by the change of use. This bill would authorize a city or county, or city and county, commencing in the 2026–27 fiscal year, to establish an adaptive reuse investment incentive program to pay adaptive reuse investment incentive funds to the proponent of an adaptive reuse project approved pursuant to the streamlined, ministerial process described above for up to 30 consecutive fiscal years, as specified. The bill would define "adaptive reuse investment incentive funds" to mean an amount up to or equal to the amount of ad valorem property tax revenue allocated to the participating local agency from the taxation of that portion of the total assessed value of the real and personal property of an adaptive reuse project property that is in excess of the qualified adaptive reuse project property's valuation at the time of the proponent's initial request for funding. The bill would define various other terms for these purposes, and would make findings and declarations related to its provisions. The bill would make its provisions operative on July 1, 2026. (2) Existing law, the California Environmental Quality Act (CEQA) , requires a lead agency, as defined, to prepare, or cause to be prepared, and certify the completion of, an environmental impact report on a project that it proposes to carry out or approve that may have a significant effect on the environment. CEQA does not apply to the approval of ministerial projects. This bill, by establishing the streamlined, ministerial review process described above, would exempt the approval of adaptive reuse projects subject to those processes from CEQA. The bill would also exempt specified findings regarding industrial uses and ordinances adopted to implement specified provisions from CEQA. (3) Existing law requires each county and city to adopt a comprehensive, long-term general plan for the physical development of the county or city, and specified land outside its boundaries, that includes, among other mandatory elements, a housing element. Existing law requires the Department of Housing and Community Development to notify a city, county, or city and county, and authorizes the department to notify the Attorney General, that a city, county, or city and county is in violation of state law if the department finds that the housing element or an amendment to that element, or any specified action or failure to act, does not substantially comply with the law as it pertains to housing elements or that any local government has taken an action in violation of certain housing laws. This bill would make corrections to a housing law cross-reference relating to the adaptive reuse project process established by the bill, thereby making a violation of that adaptive reuse project process by a city, county, or city and county subject to the above-described notification requirements. (4) The bill would include findings that changes proposed by this bill address a matter of statewide concern rather than a municipal affair and, therefore, apply to all cities, including charter cities. (5) This bill would incorporate additional changes to Section 65585 of the Government Code proposed by AB 650 to be operative only if this bill and AB 650 are enacted and this bill is enacted last. (6) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for specified reasons.
Existing law, the Planning and Zoning Law, requires a city or county to adopt a general plan for land use development within its boundaries that includes, among other things, a housing element. The law requires the Department of Housing and Community Development (HCD) to determine whether the housing element is in substantial compliance with specified provisions of that law. Existing law requires HCD to designate jurisdictions as prohousing pursuant to emergency regulations adopted by HCD, as prescribed, and to report those designations to the Office of Land Use and Climate Innovation. Existing law specifies that these emergency regulations will remain in effect until HCD promulgates permanent prohousing regulations. This bill would instead require HCD to designate jurisdictions as prohousing pursuant to permanent regulations adopted by HCD to implement these provisions, as specified. Beginning with the 7th housing element cycle, upon request by a small rural jurisdiction, to the extent feasible, the bill would require HCD to evaluate materials from the small rural jurisdiction's housing element submission when determining whether the jurisdiction qualifies as prohousing, but only with respect to those small rural jurisdictions that have a compliant housing element. The bill would also prohibit HCD from requiring small rural jurisdictions to renew their prohousing designation for at least 4 years. The bill would define "small rural jurisdiction" for these purposes to mean either a city with a population of fewer than 25,000 persons or a county with a population of fewer than 200,000 persons. This bill would incorporate additional changes to Section 65589.9 of the Government Code proposed by SB 262 to be operative only if this bill and SB 262 are enacted and this bill is enacted last.
