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Affordable Housing Legal Alert: Assembly Bill 2135 Strengthens Priorities for Affordable Housing on Public Surplus Land

Assembly Bill 2135, signed into law last year, has strengthened an important tool for affordable housing developers. The bill amended California’s Surplus Land Act, which prioritizes affordable housing by giving affordable housing developers a first right of refusal when local agencies sell or lease surplus land. This affordable housing law alert describes the revised Act.

Highlights of the revisions include:

  • An extended negotiating period for local agencies and affordable housing developers;
  • An extension of the Act’s required affordability period to 55 years;
  • A requirement that any affordable housing developer proposing a project agree to make at least 25% of the project’s units affordable to lower income households and, if there are multiple offers, a priority for the project proposing the greatest number of units, at the deepest level of affordability;
  • An additional requirement—if no affordable housing entity agrees to terms under the Act—that any residential development (of 10 or more units) on surplus land make at least 15% of the units affordable to lower income households; and
  • Express authority for local agencies to sell or lease surplus land for less than fair market value to facilitate the creation of affordable housing near transit.

The revision also adds language that explicitly recognizes the connection between affordable housing and transportation use, which may have important implications for local agencies concerned with maintaining and growing transit ridership.

Earlier this year, Public Counsel released “Delivering the Promise of Transit: How Transit Agencies Can Increase Ridership—and Clean Air—by Discounting Land for Affordable Housing”, an examination of California laws relevant to transit agencies that would like to facilitate affordable housing development through strategies that involve discounting land.