New California Housing Measures Adjust ADU Impact Fees and Infill Development Rules

California Gov. Gavin Newsom recently signed a package of housing legislation aimed at speeding up residential construction across Southern California, introducing changes to fee structures and zoning rules.

Among the measures, Senate Bill 1117 adjusts how municipalities assess local infrastructure impact fees on accessory dwelling units larger than 750 square feet. Under prior regulations, surpassing 750 square feet triggered full impact fees across the entire structure. The new measure exempts the first 750 square feet from fees entirely, requiring builders to pay impact assessments only on the square footage exceeding that threshold. Pro-housing advocates note the change could save builders thousands of dollars, though total savings will vary by jurisdiction because local policies differ; for instance, the city of San Diego exempts the first two accessory units regardless of size, while an owner in La Mesa could save roughly $2,800 on a 1,200-square-foot build under current fee schedules.

Another measure, Senate Bill 1116, attempts to facilitate the development of for-sale townhouses and condominiums on smaller residential parcels. The legislation establishes qualifying requirements, such as requiring existing single-family structures to have sat vacant for at least five years or applying to vacant lots, which are uncommon in built-out coastal markets.