While some have hailed it as the “worst bill of the year,” others have welcomed it as a long overdue move toward resolving California’s persistent housing shortage.
However, the Affordable Housing and High-Road Jobs Act of 2022 is anticipated to have a significant impact for multifamily developers in the state when it becomes law next summer, regardless of popular sentiment.
Charles “C.J.” Higley, a lawyer with the Northern California legal firm Farella Braun + Martel LLP, stated that this may potentially release a great number of properties for residential construction that have historically been reserved, by virtue of zoning, for retail or office development.
The United Brotherhood of Carpenters’ general president, Doug McCarron, stated during the signing ceremony that the law “will help generate millions of urgently needed new homes and protect the workers who will build them.”
According to McCarron, the opportunity to afford the housing they are constructing will be important for workers.
According to Higley, the legislation might also have a significant influence on developers.
In the 20 years that he has been a developer’s representative, he said, this might result in much shorter deadlines and better confidence surrounding project planning, both of which have been recognized as two of the major impediments to building.
Home rule, which Higley referred to as a “sacrosanct principle” in the state of California and grants local governments the final say in what is constructed inside their borders, is at issue.
He stated that our governance style is deeply rooted in the decentralization of decision-making to those closest to the consequences of those decisions. for good reasons. For good reasons. We tend to distrust centralized control for good reasons.
However, the outdated approach permitted other communities to turn down projects for much-needed multifamily housing. The state has reached a “tipping point” as a result of pervasive NIMBYism, even when it is driven by justifiable concerns, according to Higley.
According to one study, the bill might permit multifamily building on more than 100,000 acres in the state’s commercial corridors, which could lead to the construction of up to 2.4 million new homes. Losses in retail sales tax revenues would be offset by gains in tax revenues from residential and mixed-use developments, according to the California web-based platform UrbanFootprint, which sells tools for urban planners. This would result in a net rise in local and state tax revenues.
However, not all local governments will agree with that upbeat analysis. As legal challenges to the new law are brought forth, Higley stated that he anticipates a time of considerable uncertainty.