What is SB-9 and how does it apply to the properties in Brisbane?

What is SB-9?

SB-9, known as Senate Bill 9, is a California legislation designed to alleviate the housing shortage by allowing homeowners to split their single-family residential lots into two parcels and construct up to two homes on each parcel. This effectively doubles the housing capacity of the property. The bill simplifies the approval process by eliminating the requirement for extensive environmental reviews and discretionary approvals, provided specific criteria such as lot size and zoning regulations are satisfied. However, properties located in historical districts or environmentally sensitive areas are exempt from these streamlined procedures. Participation in SB-9 is voluntary for homeowners, contingent upon their property meeting eligibility criteria and aligning with their development goals.

How SB-9 applies to properties in Brisbane?

SB-9's impact on properties in Brisbane began with the Governor's signing in 2021, followed by statewide enforcement starting January 2022. Currently, the City is actively reviewing SB-9 applications. Brisbane has the option to adopt a local ordinance that incorporates objective development standards, ensuring these standards do not hinder compliant development under SB-9 rules. Proposed standards cover areas such as parking and building heights in setback and ridgeline locations, aiming to clarify how SB-9 will be applied within the city. Additionally, the draft ordinance includes provisions to notify neighboring property owners when an SB-9 development project is approved, enhancing transparency in the process.

What can homeowners build under SB-9 or Brisbane’s HOME Act?

Urban Lot Split under SB-9

Under SB-9, an "urban lot split" involves dividing a single-family residential lot into two lots as a ministerial process. Each resulting lot can accommodate up to two units, which may include primary dwelling units and JADUs or ADUs. The maximum development allowed on the original lot area is four dwelling units, one more than typically allowed.

In this case you could have the following unit configurations:

A. Lot 1 Single-Family Dwelling (SFD)
Lot 2 Single-Family Dwelling (SFD)

B. Lot 1 Single-Family Dwelling (SFD)
Lot 2 Duplex

C. Lot 1 Duplex
Lot 2 Duplex

D. Lot 1 Single-Family Dwelling (SFD) + Single-Family Dwelling (SFD)
Lot 2 Single-Family Dwelling (SFD)

E. Lot 1 Single-Family Dwelling (SFD) + Single-Family Dwelling (SFD)
Lot 2 Single-Family Dwelling (SFD) + Single-Family Dwelling (SFD)

Two-Unit Development under SB-9

"Two-unit development" under SB-9 generally refers to constructing two primary dwelling units either on an existing lot or on a lot created through an urban lot split.

You could have the following unit configurations:

• Single-Family Dwelling (SFD) + Single-Family Dwelling (SFD)
• Single-Family Dwelling (SFD) + Single-Family Dwelling (SFD) + ADU (max. size 1,200 sqft) or JADU (max. size 500 sqft)
• Duplex
• Duplex + ADU (max. size 1,200 sqft) or JADU (max. size 500 sqft)
• Duplex + 2 ADU (max. size 1,200 sqft)

Deciding which development option works best for you is not easy, unless you understand their cost and ROI for your property. You need an SB-9 Analysis for each option to make the best decision.

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How large the new units could be and what are the lot contains?

The allowable size of new units under SB-9 is determined by the floor area limits specified in the zoning district. In R-1 districts, where the floor area ratio (FAR) is 0.72, this translates to a maximum of 3,600 square feet on a 5,000 square foot lot, with a minimum size requirement of 800 square feet for primary dwelling units. Owners have the flexibility to construct smaller units voluntarily, as long as they comply with California Building Code requirements. In R-BA districts, the FAR is also 0.72, but the total floor area cannot exceed 5,500 square feet.

Regarding lot contents, properties in R-1 zoning typically allow for one single-family dwelling unit, 1 attached JADU, and 1 ADU. SB-9 permits an additional dwelling unit on the same lot area through either an "urban lot split" or a "two-unit development" on an existing lot, subject to specific eligibility criteria and regulatory constraints.

What are the setbacks?

Under SB 9, setbacks are limited to a maximum of 4 feet from side or rear lot lines as allowed by the jurisdiction. In comparison, in the R-1 district, minimum side setbacks range from 3 to 5 feet depending on lot width, and the rear setback requirement is 10 feet. In the R-BA district, the minimum rear setback remains at 10 feet, while side setbacks range from 5 to 15 feet, also dependent on lot width.

What is the parking requirement under SB-9?

SB-9 requires that each primary dwelling unit should have no more than 1 parking space. The Planning Commission, after workshops and a public hearing on the draft ordinance, proposed an objective standard: parking can only be satisfied by off-street, uncovered spaces or those covered by a carport. Garages, although allowed at the owner's discretion, do not fulfill the minimum requirement due to concerns that garages are often used for purposes other than parking, such as storage.

What are the lot constrains under SB-9?

Under SB-9 in Brisbane, the lot constraints specify that the size ratio between the resulting lots should fall between 40:60 and 50:50. For instance, on a 5,000 square foot lot, this would translate to resulting lots ranging from 2,000 square feet and 3,000 square feet, to 2,500 square feet each.

Additionally, two resultant lots from a split should be approximately proportional in size, with the smaller lot being at least 40% of the existing lot size. Each resultant lot should also be at least 1,200 square feet in size.

Don't leave money on the table by limiting the size of your project to a minimum! SB-9 Analysis calculates for you the maximum building area so you can get the highest return.

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Who and which properties are eligible for SB-9 or HOME Act?

What are the zoning districts for properties eligible for SB-9?

Properties eligible for SB-9 are located in zoning districts such as R-BA or R-1.

Can you disregard the environmental restrictions on the lot?

No, environmental restrictions on the lot cannot be disregarded. The property should not contain wetlands, habitat for protected species, or endangered species habitat. Additionally, properties within the R-BA district, particularly those in the upper areas, are likely within the San Bruno Mountain Habitat Conservation Plan area and may contain habitat for endangered butterfly species, making them ineligible. Conservation easements on the property also prevent it from being eligible under SB-9.

Is it allowed to demolish an affordable unit?

No, it is not allowed to demolish an affordable unit in Brisbane under SB 9 development.

Is it allowed to build in High-Risk Areas?

No, construction is not allowed in very high fire hazard severity zones.

Start by checking if your property is eligible for SB-9 because not all the single-family zoned lots are eligible.

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What are the ownership and development limitations after completing a project using SB-9?

Does the homeowner need to reside on the property?

Yes, before a lot split under SB-9 can be finalized, the property owner should sign an affidavit confirming that either the owner or a member of their immediate family plans to live in one of the dwelling units as their primary residence for at least 3 years.

What are the rental regulations?

Short-term rentals are not allowed in new units, including ADUs, and JADUs.

Are existing tenants’ rights protected?

Yes, existing tenants' rights are protected under SB-9. Development cannot result in the demolition or alteration of a dwelling unit that has been occupied by a tenant within the last three years. Additionally, there are protections in place to prevent the demolition of more than 25% of existing exterior walls in properties that have had a tenant within the last three years, especially in rent-controlled housing.

How can you get the permits under SB-9 or HOME Act?

Projects subject to SB-9 can move forward using a ministerial permit process, avoiding discretionary review or hearings.

What does ministerial approval mean?

Ministerial approval streamlines housing development by complying with the predetermined guidelines, avoiding discretionary procedures. It relies on straightforward criteria to issue permits without extensive reviews or public hearings. However, in some cases, approval for lot splits can still take up to 1 and a half years despite its efficiency.

What are objective standards?

Objective standards, including "objective zoning criteria," "subdivision guidelines," and "design review criteria," are intended to remove subjective judgments by government officials. These standards rely on standardized benchmarks that developers and officials employ when submitting proposals, ensuring consistent and reliable project evaluations. They provide homeowners with clear and predictable guidelines for their submissions.

What are the steps to get the permits?

To obtain SB 9 permits in Brisbane, CA, the process differs depending on whether you're establishing a two-unit development without an urban lot split or undertaking an urban lot split itself:

How can you get the permits under SB-9 or HOME Act?

Projects subject to SB-9 can move forward using a ministerial permit process, avoiding discretionary review or hearings.

What does ministerial approval mean?

Ministerial approval streamlines housing development by complying with the predetermined guidelines, avoiding discretionary procedures. It relies on straightforward criteria to issue permits without extensive reviews or public hearings. However, in some cases, approval for lot splits can still take up to 1 and a half years despite its efficiency.

What are objective standards?

Objective standards, including "objective zoning criteria," "subdivision guidelines," and "design review criteria," are intended to remove subjective judgments by government officials. These standards rely on standardized benchmarks that developers and officials employ when submitting proposals, ensuring consistent and reliable project evaluations. They provide homeowners with clear and predictable guidelines for their submissions.

What are the steps to get the permits?

To obtain SB 9 permits in Brisbane, CA, the process differs depending on whether you're establishing a two-unit development without an urban lot split or undertaking an urban lot split itself:

Two-Unit Development without Urban Lot Split:

• Apply for a Building Permit and SB 9 Qualifying Criteria Checklist online.

Urban Lot Split Process:

• Check if you qualify and discuss with planning staff before proceeding.
• Decide between applying for a parcel map or adjusting lot lines.
• Complete and submit your chosen application (parcel map or lot line adjustment).
• Ensure all required components are included as per the tentative parcel map checklist.
• Address any necessary changes identified during the pre-application consultation.
• Process your application with staff, following the required rules, and no public hearings are needed.

The permitting process is complex, and you'll need to hire professionals to draft the drawing set and to go through the process for you. SB-9 Analysis comes with referrals to local professionals that can help you complete the project.

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How fast can you complete a project per SB-9?

This information outlines the different phases of the project along with their respective durations.

Feasibility Study with deciding the final scope of the project:
• Maximum of 3 days (CityStructure)
• Weeks if using other resources

Secure Financing: 2 to 3 weeks

Hiring the Team: 2 weeks

Design Process:
• Schematic Design: 1-2 months
• Permit Set / Design Development Drawing Set: 2-3 months
• Construction Drawing Set: 2-3 months

Permit Planning and Building Permits: 9 to 15 months with the possibility of extending further due to departmental backlogs

Construction:
• Lot Split only: 1 year
• Single Family House/Duplex: 1 year
• Accessory Dwelling Unit (ADU): 3 to 6 months

How much does a SB-9 project costs?

In this analysis, we'll explore two scenarios to assess anticipated expenses, property assessments, and potential profits for real estate ventures.

Scenario 1

New 4,000 sq.ft 3-Story Duplex + 1,000 sq.ft ADU

In this first scenario, we suggest constructing a three-story duplex with a combined area of 4,000 square feet, plus a 1,000-square-foot Accessory Dwelling Unit (ADU). The total estimated cost, including construction, permits, and professional fees (excluding land), is $2,193,018. The projected market value of the finished property in Brisbane is around $6,280,000, resulting in a return on investment (ROI) of [($4,590,000 - $2,139,918) / $2,139,918] * 100 = 115%.

Scenario 2

Lot Split with 2 new 4,000 sq.ft 3-story Duplexes

For this second scenario, we recommend dividing the lot to build two separate three-story duplexes, each with a total area of 4,000 square feet. The estimated cost, excluding land acquisition, is $3,451,998. The projected market value for these duplexes in Brisbane is $7,344,000, resulting in an ROI of 113%.

Conclusion:

Real estate projects using SB-9 in Brisbane City offer great returns, making it a really attractive option for residential development.

Balancing costs and market value from the very beginning is key to an SB-9 project with positive returns. SB-9 Analysis gives you all this information for your project.

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