Planning and zoning: housing development projects: subdivisions

The law limits local development standards that can prevent housing on eligible subdivided lots and revises project eligibility rules. It also requires local reporting on use of these streamlined approvals.

What the law does ​

• Requires height limits to regulate physical building height, not the number of floors, for qualifying projects.
• Bars qualifying local rules that require more than a 10-foot front setback, internal setbacks, enclosed parking, or a floor-area ratio below 1.25, subject to building-code requirements.
• Allows smaller newly created parcels through lot-size averaging, including multifamily parcels as small as 480 square feet and single-family parcels as small as 960 square feet when average-size requirements are met.
• Updates eligibility rules for streamlined subdivisions, including density standards, the definition of vacant land, and the calculation of habitable floor area.
• Makes private land-use restrictions unenforceable when they prohibit or physically prevent an eligible project, except on property in a common interest development.
• Requires cities and counties to report applications, approvals and denials, permits, completed units, and income categories for these projects beginning with reports due April 1, 2028.

Who it affects ​

• Property owners and housing developers seeking to divide and build on eligible multifamily-zoned or vacant single-family-zoned urban lots.
• Cities and counties that process subdivision maps, housing applications, and annual housing-element reports.
• Owners subject to private covenants or deed restrictions affecting eligible housing projects, except owners in common interest developments.

Context ​

The substantive changes apply to applications received by local agencies on or after January 1, 2027.

Breakdown ​

Housing Rules on Subdivided Lots ​

SB 1116 clarifies and expands limits on local rules for qualifying housing projects on certain subdivided lots. Height limits must be based only on a building’s physical height, not its number of stories. The bill also restricts certain setbacks, revises density-related limits, and directs local agencies to read these rules broadly to allow the greatest total number of homes.

Key takeaways

• Local height limits for covered projects must regulate a building’s physical height rather than its number of floors.
• Local agencies generally may not impose specified front or internal setback requirements, subject to stated exceptions.
• The bill modifies the rules that limit local restrictions related to a project’s density on the lot.
• Local agencies must interpret the ministerial-approval provisions broadly in favor of producing the maximum total number of housing units.
• These changes apply to qualifying housing development projects on certain subdivided lots.

Housing Subdivision Map Standards ​

Starting January 1, 2027, SB 1116 changes the standards housing projects must meet to receive streamlined local approval of certain subdivision maps. It replaces the requirement that some lots be substantially surrounded by urban uses with alternative eligibility tests, changes parcel-size rules for multifamily sites, and updates how floor area and vacant land are defined.

Key takeaways

• The bill replaces the requirement that certain lots be substantially surrounded by qualified urban uses with other eligibility requirements set by law.
• It allows newly created parcels on multifamily-zoned sites to be as small as 480 or 960 square feet when specified conditions are met.
• When lot-size averaging creates smaller parcels, no new residential parcel may exceed 50% of the original parcel’s size, subject to stated exceptions.
• The bill excludes stairs and enclosed bicycle parking from the calculation of net habitable square feet.
• For this streamlined approval process, a lot is vacant if it has no permanent structure, unless an existing permanent structure is abandoned or untenantable.
• These changes apply to applications local agencies receive on or after January 1, 2027.

Expanded Local Housing Reporting ​

Beginning with annual reports due April 1, 2028, cities and counties must report additional information about certain housing development projects submitted under subdivision and ministerial-approval rules. They also must include specified information about surplus land disposals in their annual housing reports.

Key takeaways

• The new reporting requirements begin with the annual report due April 1, 2028.
• Local agencies must add specified information about housing development projects received under the bill’s subdivision and ministerial-approval provisions.
• Local agencies must also report specified information related to surplus land disposals.
• These additions expand the information cities and counties already provide in their annual housing reports.

Private Restrictions on Subdivided Housing ​

The bill makes certain private property restrictions unenforceable when they block or physically prevent a housing project on a qualifying subdivided lot. This applies to restrictions in deeds, declarations, contracts, security instruments, and similar documents. Property within a common interest development is excluded.

Key takeaways

• The bill invalidates private land-use restrictions that prohibit or physically preclude a housing project on a qualifying subdivided lot.
• The rule applies to restrictions contained in deeds, declarations, contracts, security instruments, and similar property documents.
• A restriction may be unenforceable even if it does not expressly ban housing, if it would physically prevent the housing project from being developed.
• The change does not apply to real property that is part of a common interest development.

Statewide Application ​

The bill declares that its changes address a statewide concern, not solely local municipal matters. As a result, the bill applies to every California city, including charter cities.

Key takeaways

• The bill makes formal findings that its changes concern issues affecting the state as a whole.
• The bill states that these changes are not treated only as local municipal affairs.
• The bill applies to all California cities, including charter cities.

Coordinating Overlapping Bill Changes ​

This part coordinates SB 1116 with other housing bills that amend the same Government Code sections. The added changes apply only if the related bills also become law and SB 1116 is enacted last, preventing conflicts between overlapping amendments.

Key takeaways

• Changes tied to AB 1567 for Government Code Section 65400 take effect only if both bills are enacted and SB 1116 is enacted last.
• Changes tied to AB 2601 or SB 1090 for Government Code Section 65852.28 take effect only if the applicable bills are enacted and SB 1116 is enacted last.
• Changes tied to AB 2601 or SB 1090 for Government Code Section 66499.41 take effect only if the applicable bills are enacted and SB 1116 is enacted last.
• These provisions coordinate amendments to the same code sections when multiple bills are enacted.

No State Reimbursement ​

The bill imposes new duties on local agencies, creating a state-mandated local program. However, it says the state does not have to reimburse local agencies or school districts for related costs for the reason specified in the bill.

Key takeaways

• The bill adds duties for local agencies, creating a state-mandated local program.
• The bill provides that no state reimbursement is required for costs arising from these duties.
• Existing state reimbursement procedures do not require payment when the bill's specified reason applies.