Photograph by Matthew Suárez

“I would love nothing more than to pay for my permits....”

The San Jose Mercury News recently called the practice of renting to tenants living quarters built without permits in backyards and over garages “a municipal game of ‘don’t ask, don’t tell.’”

“Of course, we’d like to have all our proper permits,” says a homeowner who owns a tidy, but unlawful rental unit constructed behind a single-family home near Linda Vista. Due to a fear of “huge penalties and fees,” the owner asked not to be identified by name nor by the exact neighborhood where their property is situated.

“I would love nothing more than to go ahead and pay for my permits and come up to code,” the homeowner says. “But they are going to penalize us to the point where we’d have to sell our own house.”

Over 50 percent of the homes in Coronado are occupied only part of the year.

Photograph by Matthew Suárez

Yet, current and pending legislation would likely eliminate some if not most of the fees and penalties about which the owner is concerned. But that fact is not easily believed by the homeowner. And there’s another reason for reticence.

“For us it’s not just about the money,” the homeowner says. “Like I said, we’d feel better about the entire situation if we got our permits. But we’ve got tenants, working people with two kids. I don’t think they’d find anything as affordable as what we charge, $1290 a month. He’s a gardener. She works part-time at a doctor’s office. I can’t just evict them and tear down this or that part of the building, you know, just to bring the unit up to code.”

Granny flats incentivized

The past four years has seen a flurry of activity in Sacramento with regard to bills addressing granny flats. Starting in 2015 there was a swell of proposed legislation. Most bills died before reaching the governor’s desk. But some were signed into law. Now a sea change may be on the horizon.

In 2015, AB 2406 was one of three bills that began to put cracks in the political armor of municipalities disinclined to permit the growth of backyard rentals within their jurisdictions.

By prohibiting local governments from requiring additional parking or charging additional water or sewer fees with their construction, that particular bill incentivized the building of so-called “junior accessory dwelling units,” i.e., granny flats of 500 square feet or smaller size.

Still, by allowing cities to continue requiring junior rentals to have adjoining doors that lead into the main house, and by allowing local governments to require that the property owner occupy at least one of the dwellings on a single-family lot with such a unit, AB 2406 continued Sacramento’s longstanding deference to municipalities opposed to increasing residential neighborhood density.

While AB 2406 requires municipalities to limit junior granny flats to one-per lot, it does not require a city to have an ordinance on the books that governs junior accessory dwellings.

“The granny flat may be rented for a minimum of six months.”

Photograph by Matthew Suárez

Two other bills from the 2015-16 legislative season, some provisions of which went into effect in 2017 and ‘18, require greater “ministerial approval” of granny flat building-permits. That means permitting procedures should be strictly by-the-book, not subject to bureaucratic discretion. A prohibition on municipalities’ practice of requiring additional off-street parking spaces be a part of construction of new granny flats located near public transit lines was another liberalization established by state laws passed in recent years.

A later bill, SB 831, would have gone even further and would have applied to larger units — up to 1200 square feet. It was co-sponsored by San Diego’s state senator Toni Atkins. That bill died before it reached the governor.

Sweeping provision

Fast forward to late February, 2019. That’s when one of the alternative dwelling movement’s legislators, Richard Bloom (D-Santa Monica) introduced AB 881. Bloom’s bill, currently at the Assembly Housing and Community Development Committee is the most robust alternative dwelling bill introduced to date.

In addition to including the usual one-unit per lot and five-foot rear and side property line-setback provisions, Bloom’s bill contains this sweeping provision which will please affordability advocates: “The ordinance shall not be considered in the application of any local ordinance, policy, or program to limit residential growth.”

By “the ordinance,” Assemblyman Bloom’s bill refers to any city or county ordinance attempting to put a slow-growth (or no-growth) kibosh on granny flats within its boundaries.

Coronado seeks its own way

The city of Coronado has been thought of by some as a resistor of more liberal granny flat ordinances. But it’s not as simple as saying Coronado doesn’t want affordable housing, city officials explain.

Councilman Bill Sandke grew up in Coronado in a military family when, he says, living there was feasible on lieutenant’s salary.

“Housing affordability is a critical concern as we see declining enrollment in our school system and less participation across our community institutions as so many are simply priced out of the market,” Sandke says. “And that goes for rentals as well as home purchases. Accessory dwelling units should help.”

Last year, a total of 12 permits for alternative dwelling units were issued in Coronado. So far this year, just one permit has gone forward. Granny flats aside, like most cities, even tony Coronado has designated affordable-housing units. But like most cities Coronado’s affordable-housing units are limited in supply; and they come with long waiting lists.

Councilman Sandke says the negative impacts of housing trends are made more acute in Coronado by the large number of homes that are only occupied for part of the year.

“By some estimates that’s now over 50 percent,” he says. “Specifically for beach communities like Coronado, the land values and market pressures mean that the simple laws of supply and demand don’t work. More homes in Coronado will mean simply a larger number of expensive homes, not an overall supply-led rise in affordability.”

That dynamic is why, says Sandke, in Coronado the “a” in ADU, an abbreviation for “accessory dwelling unit,” will never stand for “affordable.” He says municipal laws now on the books seek to maintain the city’s character and quality of life, even as Coronado adapts to mandates from the state that seek to make it easier for homeowners to rent out granny flats.

Sandke and other local elected officials in beach cities up and down the California coast are dubious about how effective state laws will be in their communities — especially in the age of AirBnB and similar home-sharing, short-term rental apps.

“Our rental policy allows rental of the primary dwelling or the accessory dwelling unit, but not both separately,” the councilman explains.

“The main house is subject to a 26-day minimum and the [granny flat] may be rented for a minimum term of six months. Like many vacation communities, neighbors struggle with short-term rentals disrupting neighborhood quality of life. Our policy is guided by protecting our residents. Short of additional state intervention, I don’t see these policies changing.”