AB 1561 Extends Housing Entitlements by 18 Months

Originally posted to Unfamiliar Terrain

By Megan Jennings and Lisa Gluckstein 

The state has granted an 18-month extension to certain housing development entitlements that were otherwise due to expire before the end of 2021. AB 1561 (Garcia) was enacted last year to support continued housing production in light of the ongoing economic and administrative challenges created by the COVID-19 pandemic. Its provisions apply to approvals, permits, and entitlements for housing development projects issued by a state or local agency that were in effect on or before March 4, 2020 and that would otherwise expire before December 31, 2021. Under AB 1561, these housing entitlements are extended for 18 months from their original expiration date.

This 18-month permit extension applies to entitlements for housing development projects and mixed use projects in which at least two-thirds of the square footage is residential, including the following:

A. State Permits: A legislative, adjudicative, administrative, or any other kind of approval, permit, or other entitlement necessary for, or pertaining to, a housing development project issued by a state agency;
B. Local Permits: An approval, permit, or other entitlement issued by a local agency for a housing development project that is subject to the California Permit Streamlining Act (Gov. Code § 65920 et seq., which includes a broad range of discretionary development approvals);
C. Ministerial Permits: A ministerial approval, permit, or entitlement by a local agency required as a prerequisite to the issuance of a building permit for a housing development project;
D. Application Submittal Deadlines: A requirement to submit an application for a building permit within a specified period of time after the effective date of a housing entitlement described in subparagraph (B) or (C); and
E. Vested Rights: A vested right associated with an approval, permit, or other entitlement described in (A)-(D), above.

Some limited exceptions apply; for example, the legislation does not extend the life of development agreements or projects approved pursuant to the SB 35 ministerial streamlining process. Additionally, the protections of AB 1561 do not apply to housing entitlements that were previously extended by at least 18 months by a local agency on or after March 4, 2020 and before September 28, 2020 (the effective date of AB 1561). However, the protections otherwise support a broad range of housing-related approvals, reflecting the legislature’s intent to provide developers with a longer runway to support the construction of housing development projects in the context of a state-wide undersupply of housing intensified by the pandemic-induced recession.

Extensions for San Francisco Projects

On March 16, 2021, San Francisco’s Zoning Administrator issued a Letter of Determination indicating that the City’s typical approval condition, which provides extensions for delays caused by a public agency, an appeal, or legal challenge, is deemed trigged for the recognized delay period of March 17, 2020 through March 16, 2021. For example, if a project’s required performance period is July 17, 2017 to July 17, 2020 (otherwise expiring 4 months after the beginning of the recognized delay period), the performance period is extended for 4 months (the duration of the overlap between the performance period and the recognized delay period in this example). Any such extension granted by the City of San Francisco runs concurrently with the 18-month extension granted by AB 1561.

No additional action is needed by state or local agencies to apply the 18-month extension to covered housing entitlements. However, interpretation and implementation may vary by individual agency, so it is advisable to consult with counsel on a project-specific basis about the analysis and how best to memorialize the extension.