San Diego adds new incentive to spur more low-income ADUs

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Council unanimously OKs softening low-income requirements for controversial bonus ADU program.

San Diego gave developers a new incentive Monday to build more accessory dwelling units for low-income people.

The new incentive makes it easier to take advantage of the city’s bonus program, which has allowed construction of one bonus ADU by any property owner willing to build an ADU and rent it at a reduced rate to low-income or moderate-income residents for 15 years.

The incentive, which the City Council approved unanimously, shrinks the duration of rent restrictions from 15 years to 10 years for low-income residents, but maintains the 15-year requirement for moderate-income residents.

City officials say accessory dwelling units, sometimes called granny flats or casitas, are the fastest and cheapest way to address the local housing crisis. They say having more of the units reserved for low-income residents can reduce homelessness.

Critics say incentivizing thousands of new ADUs across San Diego threatens to dramatically change the look and feel of many single-family neighborhoods.

Tenants eligible to live in ADUs restricted for low-income people must earn less than $39,930 — 60 percent of the area’s median annual income of $66,550 for single-person households.

Moderate income is defined as between 60 percent and 110 percent of the city’s median income. The bonus ADU can be rented at market rate.

Council President Sean Elo-Rivera, who spearheaded efforts behind the new incentive, said he’s hopeful developers and homeowners will embrace the new 10-year option.

“They may like the option of having an unencumbered deed after 10 years, which makes their asset more flexible,” he said. “This 10-year period may provide them more favorable terms from the bank to allow them to secure a loan. This will provide us more data to make more informed decisions in the future.”

San Diego’s rules for ADUs are already believed to be among the loosest in the state, but city officials continue to tinker with them — sometimes in response to outcry from neighborhood leaders.

Last month, the city rolled back the regulations slightly to increase distances ADUs must be built from property lines, enhance landscaping requirements and provide greater clarification of many rules.

Source: San Diego Union Tribune