Debate on California Housing Bill Foreshadows Larger Fights to Come
See all Insights

Debate on California Housing Bill Foreshadows Larger Fights to Come

Brownstein Client Alert, Oct. 12, 2023

Yesterday, Gov. Gavin Newsom signed SB 4, the Affordable Housing on Faith and Higher Education Lands Act of 2023, a highly anticipated bill to streamline affordable housing on land owned by religious institutions and nonprofit colleges. Debate surrounding the legislation throws a harsh light on a brewing conflict between housing and environmental advocates: how to solve a chronic 50-year-old housing crisis without risking environmental safety or justice.

Read our more detailed overview of the bill from last year here.

For a quick overview: Senate Bill 4 (SB 4) would require ministerial approval—meaning the project can avoid the California Environmental Quality Act (CEQA) and other discretionary land use permitting processes—of a development application on any land owned by either an independent institution of higher education or a religious institution on or before Jan. 1, 2024. To be eligible for streamlining, the project must meet a number of criteria:

  • affordability requirements (100% of the units must be affordable to lower-income households, with an option to make 20% of the units affordable to moderate-income households);
  • compliance with objective standards set by the local jurisdiction;
  • parking minimums (with certain exceptions);
  • prevailing wages for projects over 10 units and specified labor standards on projects over 50 units; and
  • restrictions on locations close to heavy industrial uses.

The law sunsets on Jan. 1, 2036.

The balance of housing needs and environmental regulation is an increasingly contentious issue in California. The state appellate courts have recently seen wave after wave of CEQA litigation challenging long-range development plans and housing projects for University of California campuses, particularly U.C. Berkeley. SB 4 applies to “independent institutions of higher education,” defined as “nonpublic higher education institutions” that are “nonprofit corporations” and “are accredited . . .” (Cal. Educ. Code Section 66010). Notably, this does not include public higher educational institutions like the California State University, University of California and California Community College systems.

Despite enjoying strong support from legislators throughout the year, SB 4 almost faltered late in the committee process due to strong, unresolved environmental opposition. In a late-night hearing of the Assembly Natural Resources Committee on July 10, the bill almost failed to receive the necessary votes to pass until its primary sponsor, Sen. Scott Wiener, agreed to accept amendments that prohibited projects in proximity to specified industrial sites and oil and gas infrastructure.

This concession was a priority for an alliance of environmental organizations led by the California Environmental Justice Alliance (CEJA). While CEJA likely did not have the votes to kill the bill going into committee, the strong objections of committee chair Luz Rivas ultimately gave them leverage to secure an amendment.

Sen. Wiener and the bill’s sponsors initially objected to the change, arguing that oftentimes communities that are co-located with industrial uses are also the most in need of affordable housing and that precluding them from building would further compound their economic disadvantages.

The bill ultimately passed the committee and subsequently followed an easy path to the governor’s desk. Nonetheless, the conflict was indicative of the lingering tension between the desire of housing advocates to build quickly and the desire of environmental justice advocates to protect potential tenants from potentially unsafe living conditions. This conflict is set against the backdrop of inexorably rising housing inequality and the recognition that our current housing paradigm is itself environmentally unsustainable.

As new leadership takes the helm in both the Assembly and the Senate next session, we expect to see these issues borne out in further high-profile legislative fights.

This document is intended to provide you with general information regarding SB 4 in California. The contents of this document are not intended to provide specific legal advice. If you have any questions about the contents of this document or if you need legal advice as to an issue, please contact the attorneys listed or your regular Brownstein Hyatt Farber Schreck, LLP attorney. This communication may be considered advertising in some jurisdictions. The information in this article is accurate as of the publication date. Because the law in this area is changing rapidly, and insights are not automatically updated, continued accuracy cannot be guaranteed.

Recent Insights