Impact of New Accessory Dwelling Unit Laws

Since 2017, the Legislature has passed a series of new laws that significantly increase the potential for development of new ADUs and JADUs by removing development barriers, allowing ADUs through ministerial permits, and requiring jurisdictions to include programs in their housing element that incentivize their development. As a result, using trend analysis when estimating the potential for development may not accurately reflect the increased potential for these units. To account for this increased potential, HCD recommends the following options when performing this analysis:

• Use the trends in ADU construction since January 2018 to estimate new production. This is a conservative option to only account for the effect of the new laws without local promotional efforts or incentives (safe harbor option).

• Where no other data is available, assume an average increase of five times the previous planning period construction trends prior to 2018. This option is a conservative estimate based upon statewide data on ADU development since the implementation of the new laws (safe harbor option).

• Use trends from regional production of ADUs.

• Include programs that aggressively promote and incentivize ADU and JADU construction.

• Other analysis (reviewed on a case-by-case basis).

Potential affordability of these units must still be calculated per the analysis outlined on the previous page. In addition to the above options, the element should also include a monitoring program that a) tracks ADU and JADU creation and affordability levels, and b) commits to a review at the planning cycle mid-point to evaluate if production estimates are being achieved. Depending on the finding of that review, amendments to the housing element may be necessary, including rezoning pursuant to Government Code 65583.2 (h)and (i). End ADU explanation

• Alternative Adequate sites: Under limited circumstances, a local government may credit up to 25 percent of their adequate sites requirement per income category through existing units that will be:

  • substantially rehabilitated

  • in a multifamily rental or ownership housing complex of three or more units that are converted from non affordable to affordable rental

  • preserved at levels affordable to low- or very low-income households, where the local government has provided those units with committed assistance

For more information on this option, please refer to HCD’s Building Blocks Webpage

• Manufactured housing, manufactured housing park hook-ups, floating homes/live aboard berths: In certain circumstances a jurisdiction can utilize the potential for new manufactured housing either in a manufactured housing park or on large properties in rural areas, or new floating home/liveaboard berths with sewer and water hook ups. In cases of a manufactured home park or in floating home/liveaboard berth marinas, the jurisdiction may count new spaces with infrastructure hook-ups intended for permanent residential occupancy and reported to the Department of Finance. Potential for manufactured homes in rural areas should be analyzed using the same factors as those

Site Inventory Guidebook

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May 2020

for potential ADUs, including establishing the market rate affordability of the units and crediting them to the appropriate RHNA category. In addition, the analysis should indicate if appropriate water and sewer infrastructure is available to support the development.

• Former military housing: Sites that contain permanent housing units located on a military base undergoing closure or conversion as a result of action pursuant to the Defense Authorization Amendments and Base Closure and Realignment Act (Public Law 100-526), the Defense Base Closure and Realignment Act of 1990 (Public Law 101-510), or any subsequent act requiring the closure or conversion of a military base may be identified as an adequate site if the housing element demonstrates that the housing units will be available for occupancy by households within the planning period of the housing element. No sites containing housing units scheduled or planned for demolition or conversion to nonresidential uses shall qualify as an adequate site.

• In consultation with HCD, other alternatives may be considered, such as motel conversions, adaptive reuse of existing buildings, or legalization of units not previously reported to the Department of Finance.