Multifamily Owners: New Laws Provide Opportunity to Add Units

Several California laws adopted in 2019 to facilitate accessory dwelling units (ADUs) directly benefit multifamily owners. The primary laws of interest are Assembly Bill 68 (Ting), Assembly Bill 881 (Bloom), and Senate Bill 13 (Wieckowski). The three bills overlap significantly and amend California Government Code Section 65852.2. We anticipate that many multifamily owners will be able to quickly create additional units within their existing multifamily projects based on these recent changes.

Quicker Approval Processing

The biggest opportunity for multifamily owners is found in Government Code Section 65852.2(e), which was expressly amended to provide for the ministerial and administrative (i.e., no CEQA or public hearing) approval of ADUs for multifamily owners in the following two instances:

1. The conversion of unused space within existing multifamily structures to ADUs, such as storage rooms, boiler rooms, passageways, attics, basements, or garages, for a total increase of up to 25% of the existing multifamily dwelling units, and
2. The addition of two detached ADUs on the same lot containing existing multifamily dwellings, which ADUs can be up to 16 feet in height and must have at least 4-foot rear and side setbacks.

The local agency must act on an application within 60 days (reduced from 120 days) and the application is deemed approved if not acted upon within such timeframe. Local agencies cannot impose  a minimum lot size or, until January 1, 2025, an owner-occupant requirement.

Eliminated or Reduced Parking Requirements

The local agency cannot require parking for the ADU if:

1. The ADU is located within one-half mile walking distance of public transit,
2. When there is a car share vehicle located within one block of the ADU, or
3. The ADU is located within an architecturally and historically significant historic district.

For units that do not meet the exemptions above, parking requirements are capped at one space per ADU. If a garage, carport, or covered parking structure is demolished in conjunction with the construction of an ADU, the local agency may not require the replacement of such parking spaces.

Eliminated or Reduced Impact Fees

Local agencies also cannot impose impact fees on ADUs less than 750 square feet. For ADUs over 750 square feet, the impact fees must be proportional to the primary dwelling unit.  Additionally, connection fees cannot exceed the reasonable cost of providing the service.

Relevant Excerpts from Government Code Section 65852.2

65852.2(a)(1)(D)(xi) When a garage, carport, or covered parking structure is demolished in conjunction with the construction of an accessory dwelling unit or converted to an accessory dwelling unit, the local agency shall not require that those off-street parking spaces be replaced.

65852.2(d) Notwithstanding any other law, a local agency, whether or not it has adopted an ordinance governing accessory dwelling units in accordance with subdivision (a), shall not impose parking standards for an accessory dwelling unit in any of the following instances:

1. The accessory dwelling unit is located within one-half mile walking distance of public transit.
2.  The accessory dwelling unit is located within an architecturally and historically significant historic district.
3. The accessory dwelling unit is part of the proposed or existing primary residence or an accessory structure.
4.  When on-street parking permits are required but not offered to the occupant of the accessory dwelling unit.
5.  When there is a car share vehicle located within one block of the accessory dwelling unit.

65852.2(e)(1) Notwithstanding subdivisions (a) to (d), inclusive, a local agency shall ministerially approve an application for a building permit within a residential or mixed-use zone to create any of the following:

(C)(i) Multiple accessory dwelling units within the portions of existing multifamily dwelling structures that are not used as livable space, including, but not limited to, storage rooms, boiler rooms, passageways, attics, basements, or garages, if each unit complies with state building standards for dwellings.

(ii) A local agency shall allow at least one accessory dwelling unit within an existing multifamily dwelling and shall allow up to 25 percent of the existing multifamily dwelling units.

(D) Not more than two accessory dwelling units that are located on a lot that has an existing multifamily dwelling, but are detached from that multifamily dwelling and are subject to a height limit of 16 feet and four-foot rear yard and side setbacks.

65852.2(f)(3)(A) A local agency, special district, or water corporation shall not impose any impact fee upon the development of an accessory dwelling unit less than 750 square feet. Any impact fees charged for an accessory dwelling unit of 750 square feet or more shall be charged proportionately in relation to the square footage of the primary dwelling unit.

65852.2(f)(5) For an accessory dwelling unit that is not described in subparagraph (A) of paragraph (1) of subdivision (e), a local agency, special district, or water corporation may require a new or separate utility connection directly between the accessory dwelling unit and the utility. Consistent with Section 66013, the connection may be subject to a connection fee or capacity charge that shall be proportionate to the burden of the proposed accessory dwelling unit, based upon either its square feet or the number of its drainage fixture unit (DFU) values, as defined in the Uniform Plumbing Code adopted and published by the International Association of Plumbing and Mechanical Officials, upon the water or sewer system. This fee or charge shall not exceed the reasonable cost of providing this service.