Large package of housing reforms, including changes to ‘granny flat’ rules, heads to San Diego council

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A sweeping package of housing incentives and regulation changes is heading to the San Diego City Council soon.

The package includes seven new incentives to spur construction, a small rollback of city rules governing “granny flats,” and regulations that would soften a controversial state law that allows up to four units on many single-family lots.

The package, which Mayor Todd Gloria calls “Homes for All of Us,” got unanimous approval Jan. 13 from the council’s Land Use and Housing Committee. The full council is expected to vote next month.

“This package contains critical updates to our city regulations that will allow more housing to be built for people of all income levels,” said council member Vivian Moreno, chairwoman of the committee. “As housing prices and rents continue to rise, we must take action to ensure that San Diegans have housing opportunities that accommodate their needs.”

Gloria has focused on the local changes he would like to make to state Senate Bill 9 and the new incentives he is proposing, which include allowing housing projects to be built in conjunction with new libraries and fire stations on public land.

But the rollback of rules governing granny flats — formally called accessory dwelling units — has gotten the most attention from San Diego residents.

They say the city went too far in November 2020 when it approved what are believed to be the loosest rules for accessory dwelling unit construction in the state.

San Diego allows one “bonus” ADU for every rent-restricted ADU a property owner builds, an unusual incentive that could allow several ADUs on properties that previously had just one single-family home.

A group called Neighbors for a Better San Diego has been lobbying for months against the bonus program and other elements of the city’s ADU policy.

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But city planning officials are proposing only a small rollback of ADU policies and essentially no changes to the bonus ADU program. The council’s land-use committee endorsed that approach.

Councilman Chris Cate said San Diego’s housing situation is severe enough to warrant aggressive measures like the city’s loose ADU rules.

“I’m proud that this council and the past council have taken a proactive approach to addressing our housing crisis,” Cate said.

Councilman Joe LaCava, whose District 1 includes La Jolla, expressed more sympathy for the frustrated residents, who are primarily single-family homeowners in the city’s more suburban neighborhoods.

“I agree with a lot of the issues raised by neighbors,” LaCava said. “This is going to be painful — let’s not kid ourselves. We’re talking about a fundamental change in how many of our neighborhoods were built.”

But LaCava said the proposals for tighter restrictions on ADUs would slow city efforts to solve the housing crisis too significantly for him to support them.

Heidi Vonblum, the city’s interim planning director, said San Diego is launching two detailed studies that may prompt adjustments to ADU rules and some other housing policies when the studies are completed late this year.

One study will be an economic analysis of how the ADU incentives have affected developer decisions, while the other will analyze and possibly overhaul city incentives to developers who build housing projects near transit lines.

The small ADU rollback approved by the committee last week requires larger separations between ADUs and property lines, the planting of more trees on properties with ADUs, and the imposition of fees on ADU developers in some cases.

Developers, who are now exempt from paying fees for nearby infrastructure projects, would still be exempt on the first two ADUs they build on a particular property. But they would have to pay such fees on every additional ADU of at least 750 square feet.

For SB 9, the state law that allows property owners to build up to four units on many single-family lots, Gloria is proposing some local modifications. Property owners who take advantage of SB 9, which took effect Jan. 1, can’t also use any of the city’s ADU incentives. In addition, they must provide a parking spot and pay developer fees for the third and fourth units they build on a single-family lot.

The new housing incentives proposed by Gloria include a regulation change that would allow new fire stations, libraries and other civic projects to include housing units as part of the project.

Other proposed incentives include making it easier for businesses to build onsite housing for their workers, incentives for developers who build larger “family” units with three or more bedrooms, and incentives for developers who build units geared for people with disabilities.

Gloria also is proposing changes designed to make it easier for developers to use the city’s density bonus, comply with the inclusionary housing program and build residential projects in commercial zones. ◆