Gov. Newsom Signs Council-Sponsored Bill to Close Major Housing Reform Loophole

The Bay Area Council today (Sept. 16) applauded Gov. Gavin Newsom for signing urgency legislation (AB 1174, Tim Grayson) immediately eliminating a loophole in existing housing reform law that threatened to derail thousands of units of new housing from being built. The Bay Area Council co-sponsored AB 1174 with SPUR.

“Closing this loophole will protect thousands of new housing units statewide against the whims of local opposition,” said Jim Wunderman, President and CEO of the Bay Area Council. “We applaud Gov. Newsom for his quick action in signing this important legislation and thank Assemblymember Grayson for his leadership in authoring it. Too often, the legal system is abused to block housing that we so desperately need. AB 1174 fulfills the intent of past housing reform legislation to speed more housing construction in California.”

AB 1174 fixes a loophole in SB 35 (Weiner), which was passed in 2017 and allows for fast-track approval of housing developments that meet various state and local requirements. SB 35 included a provision that unless construction begins within three years the project must return to square one for approval. But the three-year time limit in SB 35 didn’t account for delays caused by frivolous lawsuits filed against projects by housing opponents, among other . Allowing such delays and the huge costs that come with them can often be a death knell for new housing projects. The new law includes a number of other important administrative provisions.

AB 1174 will have an immediate impact in Cupertino, where a project to transform the old Vallco Mall into a massive residential and commercial development won approval under SB 35 but was challenged in a lawsuit that would have prevented it from meeting the three-year deadline set to expire on Sept. 21. The project includes 2,400 new homes, including 50% of which would be set aside as affordable to lower-income residents. It is the largest project in California approved under SB 35.

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