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

What is SB-9?

Senate Bill 9 (SB-9) streamlines the approval process for specific housing developments in California. It requires that local authorities expedite the approval of these projects without the need for comprehensive environmental reviews (CEQA), conditional use permits, or other discretionary approvals from entities such as the Planning Commission or Historic Preservation Commission. While involvement is voluntary, certain criteria should be met to qualify.

How does SB-9 apply to properties in South Gate?

SB-9 allows the creation of two residential units on existing single-family lots in South Gate, including options such as urban lot splits. This legislation simplifies the approval process for qualifying housing projects, addressing the housing crisis, and encouraging higher-density development. It also allows the construction of additional units while adhering to requirements like minimum lot sizes and zoning regulations.

What can homeowners build under SB-9 in South Gate?

Urban Lot Split options under SB-9

An urban lot split refers to the process of dividing a single property into two lots. This can be applied to properties zoned for single-family homes.

Under this option, you could have the following unit configurations:

Not sure if your property is located in a Single-family zoned area?

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Two-Residential Units under SB-9

Two residential units consist of constructed primary dwelling units on a single-family lot. If a primary dwelling is already present, a second primary unit can be added to the property.

Under this option, you could have the following unit configurations:

How large can each new unit be, and how many can you have per lot?

In South Gate, units created under SB-9 should be at least 800 square feet. However, California's SB-9 regulations do not impose any upper limits on the size of the new units.

Through an urban lot split, two units can be developed on a single lot, which may also include ADUs and JADUs.

What are the setbacks?

Setbacks can be up to 4 feet from side and rear lot lines. No setback is required for existing structures or new structures built in the same location and dimensions as existing ones.

What is the parking requirement under SB-9?

In South Gate, one off-street parking space per unit is required, unless the parcel is within half a mile of a major transit stop or high-quality transit corridor, or there is a car-share vehicle within one block.

What are the lot constraints under SB-9?

The parcel map should subdivide an existing lot into no more than two new lots of approximately equal size, with one lot not smaller than 40% of the original area. Additionally, both new lots should be at least 1,200 square feet.

Development Analysis calculates the max size under SB-9 for the highest return.

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

Which zoning designations are eligible for SB-9?

To be eligible for SB-9, properties should be located in the NL zone.

Can you disregard the environmental restrictions on the lot?

No, SB-9 prevents development on sites that include farmland, wetlands, hazardous waste areas, lands designated for conservation, habitats for protected species, or properties under conservation easements.

Can you bypass the Historical Preservation limitations?

No, the lot cannot be within a historic district, included on the State Historic Resources Inventory, or designated as a city or county landmark or historic property under local ordinances.

Is it allowed to demolish an affordable unit?

No, demolition or alteration of housing is not allowed if it is subject to a recorded covenant or law that restricts rent levels for moderate, low, or very low-income individuals and families.

Is it allowed to build in High-Risk Areas?

No, development is not allowed on sites that fall within fire hazard zones, earthquake fault zones, flood hazard areas, or floodways.

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

Does the homeowner need to reside on the property?

Yes, the applicant should sign an affidavit confirming they will occupy one of the housing units as their primary residence for at least 3 years after the lot split approval. However, this requirement does not apply to community land trusts or qualified nonprofit corporations.

What are the rental regulations?

Units created under SB-9 cannot be rented for more than 30 consecutive days.

Are existing tenants’ rights protected?

Yes, tenants' rights are protected. Demolition or alteration cannot happen if the housing is subject to rent control, has been withdrawn from rent within the past 15 years, or has been occupied by a tenant in the last 3 years.

What is the difference between SB-9 and SB-684?

SB-684 is a more recent bill that simplifies the development process for up to 10 units on urban lots smaller than 5 acres. Unlike SB-9, which applies to single-family residences, SB-684 is relevant for properties in multi-family zones or vacant single-family lots. Additionally, SB-684 does not have the ownership limitations that are part of SB-9 after development.

Below we compared SB-9 and SB-684 for you to understand the development framework outlined by each bill.

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

Does SB-9 projects qualify for a ministerial approval process and what does it mean?

Yes, projects under SB-9 are eligible for a ministerial approval process. This approach simplifies housing development by providing clear, consistent guidelines. Unlike more subjective methods, ministerial approval is based on defined criteria, reducing bureaucratic delays. As a result, projects can secure permits without needing extensive CEQA reviews or public hearings. While this process speeds things up, obtaining approval for a lot split could still take up to 1.5 years.

What are objective standards?

"Objective standards", "zoning, subdivision", and "design review standards", are intended to eliminate personal biases in the approval process. These standards are built on clear, measurable criteria that developers and officials can reference during project submissions, ensuring a consistent and reliable evaluation.

What types of objective standards qualify for a waiver under SB 9?

SB-9 allows waivers for certain standards, including:

• Regulations that hinder the construction of two units, each with a minimum size of 800 square feet.
• Setback rules for existing buildings that impede the ability to build two units.
• Setback requirements that exceed 4 feet from side and rear property lines, which limit the construction of two units.

What are the steps to get the permits?

To secure permits under SB-9 in South Gate City, follow these procedures:

1. Check Local Laws: Investigate the local Planning and Zoning regulations, including guidelines for accessory dwelling units and housing developments.

2. Verify Compliance: Make sure your proposed project meets all requirements, such as rental limitations, demolition rules, location factors, and regulations for historic districts.

3. Gather Application Materials: Assemble all required documents for your housing development or urban lot split application.

4. Submit Your Application: Send your application to the planning department for ministerial approval.

5. Request Extension for Tentative Map: If needed, seek an extension for the tentative map expiration date from the appropriate legislative body or advisory agency.

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 to get your Development Analysis
• 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
• Entitlements and Building Permits: 6 to 9 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 an SB-9 project cost?

In this analysis, we will take a look at two scenarios to evaluate expected expenses, property assessments, and potential profits for real estate projects.

Scenario 1

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

In this scenario, the plan is to build a three-story duplex that spans 4,000 square feet, in addition to a 1,000-square-foot Accessory Dwelling Unit (ADU). The estimated total cost for construction, permits, and professional services (not including land acquisition) is $2,156,454. The expected market value of the completed property in South Gate is around $2,445,000, leading to a return on investment (ROI) of [($2,445,000 - $2,156,454) / $2,156,454] * 100 = 13%.

Scenario 2

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

For this scenario, the proposal involves splitting the lot to construct two different three-story duplexes, each measuring 4,000 square feet. The projected total cost, excluding land acquisition, amounts to $3,462,200. The anticipated market value for both duplexes in South Gate is $5,912,000, resulting in an ROI of 13%.

Conclusion:

Investing in SB-9 developments in South Gate could generate returns of less than 50%. To enhance potential profitability, explore alternative financial approaches or seek to negotiate a more favorable land price.

See how much it will cost you to improve your property per SB-9

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