GOVERNOR SIGNS AB 1287, CREATING DENSITY BONUSES FOR MIDDLE-INCOME APARTMENTS AND CONDOS

October 13, 2023 (San Diego) – Wednesday, California Governor Gavin Newsom signed into law AB1287, legislation that will encourage new homes for tens of thousands of middle-income families throughout California. The bill passed the Assembly76-1 and the Senate 31-4. View bill text. The new law amends the state’s Density Bonus law, which exempts builders from parking and density requirements if projects have a specified amount of units for low-income residents.  The new law expands this to include incentives to build housing for middle income residents, allowing more units and higher buildings.

Circulate San Diego CEO Colin Parent said “This is a major legislative accomplishment. The Middle-Income Homes Bonus program will expand housing opportunities throughout California. It benefits all Californians by encouraging construction of more homes at every income level.”

While density bonuses make it easier for developers to build lower cost housing, the state mandates have drawn objections in some areas such as  La Mesa, where some residents have objected to several-story apartment units being erected in the historic downtown village, for example. But proponents contend the trade-off is needed to alleviate the state’s  severe affordable housing and homelessness crises.

AB 1287 was authored by Assemblymember David Alvarez. It was co-sponsored by Circulate San Diego, the Bay Area Council, and SPUR in San Francisco.When AB 1287 takes effect on January 1, 2025, it will create a new incentive for multi-family developments to include deed-restricted units that are affordable to different income levels.

The program can only be used when a project maximizes the production of Very-Low, Low, or Moderate-Income units, as allowed by existing California Density Bonus Law. Only when those maximums are met, does an additional bonus become available when a project deed-restricts an additional percentage of Moderate-Income homes.

 City of San Diego enacted its Affordable Homes Bonus Program (AHBP) in 2016, which substantially increased the production of both market-rate and deed-restricted affordable homes, as documented in a report by Circulate San Diego titled “Home Run for Homes.” The AHBP built upon California Density Bonus Law and allows developers to build more homes if they agree to dedicate a further portion of a new multi-family project as affordable.

San Diego’s AHBP, according to Circulate San Diego, was so successful that in 2020, Governor Gavin Newsom signed AB 2345, authored by Assemblymember Lorena Gonzalez, and co-sponsored by Circulate San Diego, to expand the AHBP statewide.

With Governor Newsom signing AB1287 into law, California takes one more step towards alleviating its housing crisis, though the measure focuses on multi-story housing,not the single-family homes that many young people aspire to own.  It also fails to address concerns over changing the character of communities.