Housing development: density bonuses: rent.

The entire amendment to Section 65915 of the Government Code (the full Density Bonus Law text including all provisions on affordable housing percentages, density bonus calculations, incentives, concessions, development standard waivers, land donations, and childcare facilities) was removed from this version of the bill.

The amendment to Section 301 of the Public Utilities Code requiring the Governor to ensure diverse composition of PUC commissioners by considering geographic diversity was removed entirely.

The bill's title changed from amending both Section 301 of the Public Utilities Code and Section 65915 of the Government Code to only adding Section 65915.9 to the Government Code.

New Section 65915.9 added: land improved with an operating hotel or motel cannot be valued for ground rent purposes under an existing lease based on density bonuses, concessions, incentives, or waivers under Section 65915, unless those density increases are entitled and vested as of the valuation date (including all required discretionary land use approvals and permits).

Fiscal committee review changed from 'yes' to 'no', reflecting the reduced fiscal impact of the narrower bill.

Senator Arreguin added as a coauthor.

The bill now amends Government Code Section 65915 (the Density Bonus Law) in addition to the original Public Utilities Code Section 301 amendment, expanding scope from utility regulation to housing development policy.

The bill's coauthors expanded from Assembly Member Petrie-Norris alone to Petrie-Norris Zbur with principal coauthors Senators Allen and Durazo, reflecting the Senate amendment process and broader coalition behind the expanded housing provisions.

Local governments must adopt ordinances implementing the density bonus law, establish processing procedures and timelines, provide complete document lists, and notify applicants whether applications are complete within specified timeframes.

Anti-displacement provisions require that if a project replaces existing rent-controlled or affordable rental units, the developer must provide replacement units of equivalent size (same number of bedrooms) at the same or lower income level, subject to 55-year affordability restrictions.

For developments meeting the 100% lower income criteria located within half a mile of a major transit stop or in a very low vehicle travel area in a designated county, local governments shall not impose any maximum controls on density (effectively unlimited height/density).

For-sale affordable units must be subject to equity sharing agreements where the local government recaptures its initial subsidy (fair market value minus sale price plus any assistance) and proportionate share of appreciation upon resale, with proceeds used within five years to promote home ownership.

New eligibility categories for density bonuses include: 10% lower income units, 5% very low income units, senior housing, 10% moderate income for-sale units, 10% transitional foster youth/disabled veterans/homeless units (with 55-year affordability restrictions), 20% lower income student housing, and 100% lower income developments.

Student housing developments qualify for density bonuses if 20% of units are for lower income students, with rent set at 30% of 65% of area median income for SRO unit type, priority for homeless students, and a 55-year affordability restriction that does not tie rental beds to specific bedrooms.

Detailed density bonus calculation tables establish specific percentage increases based on the proportion of affordable units provided, ranging from 20% to 80% density increases depending on the category and transit proximity.

Applicants may initiate judicial proceedings if a local government refuses to grant a requested density bonus, incentive, or concession. If the court finds a violation, it must award reasonable attorney's fees and costs of suit.