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

What is SB-9?

SB-9, or Senate Bill 9, is a California legislation aimed at alleviating housing shortages. It permits homeowners to divide their single-family residential lots into two and construct up to two homes on each new lot, potentially allowing for up to four housing units per property. The law streamlines the approval process by bypassing extensive environmental reviews and discretionary approvals, provided that specific criteria such as lot size and zoning regulations are met. However, properties located in historic districts or environmentally sensitive areas are exempted. Homeowners have the option to decide whether to utilize SB-9 or not.

How SB-9 applies to properties in Sacramento City?

SB-9, or Senate Bill 9, applies to properties in Sacramento City by allowing homeowners to split a single-family residential lot into two and construct up to two additional dwellings, resulting in a potential for up to four housing units on a single property. This legislation aims to address housing shortages by streamlining the approval process for urban lot splits, bypassing lengthy environmental reviews and discretionary approvals under certain conditions.

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

Urban Lot Split under SB-9

An urban lot split involves dividing a single lot into two separate lots within a zone designated for single-family residential purposes.

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)

F. Lot 1 Single-Family Dwelling (SFD) + ADU (max. size 1,200 sqft) or

JADU (max. size 500 sqft)
Lot 2 Single-Family Dwelling (SFD)

G. Lot 1 Single-Family Dwelling (SFD) + ADU (max. size 1,200 sqft) or

JADU (max. size 500 sqft)
Lot 2 Single-Family Dwelling (SFD) + Single-Family Dwelling (SFD)

H. Lot 1 Single-Family Dwelling (SFD) + ADU (max. size 1,200 sqft) or

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

JADU (max. size 500 sqft)

Two-Unit Development under SB-9

A two-unit development refers to a housing project comprising two residential units within a single lot designated for single-family residential zoning.

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 new units should have a minimum size of 800 square feet. They also need to comply with the height limits set by the applicable zoning regulations for the lot.

What are the setbacks?

Setbacks requirements are as follows:

Front-yard setback:

• If there are at least two other buildings with front-yard setbacks on the same side of the street and block, the minimum setback is the average of the nearest two setbacks.
• If there is only one other building, the setback is based on that building's front-yard setback.
• If no other building has a front-yard setback on the same side of the street and block, the minimum setback is 20 feet.

Interior side-yard setback: Minimum of 4 feet.

Street side-yard setback: Minimum of 12.5 feet.

Rear-yard setback: Minimum of 4 feet.

What is the parking requirement under SB-9?

Under SB-9, each dwelling unit typically requires one parking space, except in specific cases: when the site is within half a mile of a high-quality transit corridor or major transit stop, or when there is a car share vehicle available within one block of the lot. These exemptions aim to reduce parking requirements in areas well-served by public transportation options.

What are the lot constrains under SB-9?

Under SB-9, an existing lot can be split into up to two new lots, with one new lot not smaller than 40% of the original lot size. Each new lot should be at least 1,200 square feet in size and have either 20 feet of developed public street or alley frontage, or an easement for access and public services if no frontage is available.

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 in Sacramento City are typically within RE or R-1 zoning districts.

Can you disregard the environmental restrictions on the lot?

No, environmental restrictions on lots in Sacramento cannot be ignored. Properties located in environmentally sensitive areas like wetlands, hazardous waste sites, floodways, conservation areas, and habitats for protected species are not exempt from these restrictions. This policy aims to protect these ecologically important areas from potential harm caused by development activities.

Can you bypass the Historical Preservation limitations?

No, it's not possible to bypass the limitations set by Historical Preservation regulations in Sacramento City. The property cannot be designated as a historic property or located within a historic district listed on the State Historic Resources Inventory. Additionally, it cannot be designated as a city or county landmark or as a historic property or district under local ordinances.

Is it allowed to demolish an affordable unit?

No, housing developments in Sacramento City cannot demolish or alter units that are subject to agreements, ordinances, or regulations ensuring affordable rents for moderate, low, or very low-income individuals and families.

Is it allowed to build in High-Risk Areas?

Building in high-risk areas may be allowed under specific conditions, subject to strict regulations:

1. Construction within 100-year flood hazard areas is allowed if the site has obtained a Letter of Map Revision from the Federal Emergency Management Agency (FEMA) or meets the criteria of the National Flood Insurance Program.
2. In regulatory floodways, construction is allowed only if the site has obtained a no-rise certification.

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?

Applicants are required to sign an affidavit confirming their intention to occupy a dwelling unit on the property as their main residence for at least three years from the approval date of the urban lot split.

What are the rental regulations?

In Sacramento City, rental regulations prohibit short-term renting of any dwelling units on these properties for durations less than 30 days.

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 involves a streamlined process for housing development where developers and local authorities follow specific guidelines. Unlike subjective methods, ministerial approval strictly follows predetermined criteria, reducing administrative obstacles. This streamlined approach allows eligible projects to obtain permits without lengthy evaluations or public hearings. However, obtaining approval for a lot split may still take up to 1.5 years despite its efficiency.

What are objective standards?

What are objective standards or criteria? Objective standards, such as "objective zoning criteria," "subdivision criteria," and "design review criteria," aim to eliminate subjective judgments from government authorities. They rely on external and standardized benchmarks that developers and officials use when submitting proposals. This approach ensures consistent and reliable evaluations of projects, providing homeowners with clear and predictable guidelines for assessing their proposals.

What are the steps to get the permits?

To apply for SB 9 permits in Sacramento City, follow these steps:

• Submit your application online through the E-Planning Submittal Service webpage or the Citizen Permit Portal at aca.accela.com/sacramento.
• Ensure all documents are digitally signed, and check your email regularly for messages from [email protected].
• After acceptance, Planning Staff will invoice you for application fees, which should be paid online through the Citizen Permit Portal.
• Requirements include a completed and signed SB 9 Ministerial Approval Application, full-size and reduced plans prepared by a licensed professional, PDF exhibits, details on colors and materials, and photographs of the project site and neighboring properties.

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 floor area of 4,000 square feet, paired with a 1,000-square-foot Accessory Dwelling Unit (ADU). The projected total expenditure, which encompasses construction, permits, and professional fees (excluding land), is $2,155,159. The estimated value of the finished property in Sacramento is around $3,885,000, leading to a return on investment (ROI) of [($3,885,000 - $2,155,159) / $2,155,159] * 100 = 80%.

Scenario 2

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

For this second scenario, we propose dividing the lot to build two separate three-story duplexes, each with a total area of 4,000 square feet. The projected cost, excluding land acquisition, is $3,464,809. The expected market value for these duplexes in Sacramento is $6,216,000, resulting in an ROI of 79%.

Conclusion:

SB-9 real estate projects in Sacramento City offer substantial profitability, making it an attractive location for such developments.

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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