California YIMBY Statement on Legislative Passage of AB 1820 — Building Fee Transparency

Bill Will Help Homebuilders Plan, Budget for More Homes

“This is about fairness – our cities know how much they will charge builders for new homes; builders deserve to know, too”

SACRAMENTO — Today, the California State Legislature passed AB 1820, a bill introduced by Assemblymembers Schiavo and Grayson and co-sponsored by California YIMBY, the California Building Industry Association (CBIA), and SPUR. The vote was 38-0. The bill requires cities to provide an estimate of the impact fees they will charge for proposed new housing when builders submit their permit application.

The fees that local jurisdictions in California charge when they permit new housing are variable, unpredictable, and often punitively high; not only do fees vary from city to city, but even from project to project. Uncertainty around impact fees can deter, delay, and even kill new homes by springing unexpected costs on builders, who often work under tight budgets.

“Fee transparency is critical because many of these fees add up to twenty percent to the cost of a home — which is the tipping point for many people from having access to an affordable home,” said Assemblymember Schiavo. “I worked tirelessly on this measure to make certain that we do our part to make sure that we are bringing affordability to my community and to all Californians.”

“This bill is fundamentally about fairness,” said Brian Hanlon, CEO of California YIMBY. “Every jurisdiction in the state charges impact fees for new homes, but they often fail to tell builders what those fees will be up front. AB 1820 will make the process more fair and transparent by making cities and local jurisdictions tell home builders how much these fees will cost at the beginning of the building permit process.”

California’s local housing impact fees are often so high that they make new homes infeasible to build; in many cases, they add substantially to the cost of new housing and help make California the most expensive state in the U.S. While existing state law requires these fees to be posted online, many cities have not complied; homebuilders still face a lack of fee transparency, which makes it difficult or impossible to create accurate budgets for their projects.

AB 1820 will require cities to provide an estimate of the impact fees homebuilders will be required to pay within 10 days of the preliminary building application, at the builder’s request.

About California YIMBY

California YIMBY is a community of neighbors who welcome more neighbors. We believe that an equitable California begins with abundant, secure, affordable housing. We focus on housing and land use policy at the state and local level to ensure grassroots organizers and city leaders have the tools they need to accelerate home building. Learn more: https://cayimby.org/