Several significant developments have occurred in the last few months relative to the procedures for obtaining land use entitlements in the City and County of San Francisco. This land use alert summarizes them.

Greenhouse Gas (GHG) Impacts Checklist

Analysis of a project's potential impacts on climate change is now mandated by CEQA (the California Environmental Quality Act), and in 2010, the Bay Area Air Quality Management District (BAAQMD) promulgated GHG significant impact thresholds. Although recognizing that a single project's impacts on global climate change is nearly always individually insignificant, BAAQMD did mandate that a project's contributions to cumulative impacts be analyzed in one of several ways. One tool approved by BAAQMD is for a local agency to determine a project's compliance with a local agency's GHG Reduction Strategy, provided the reduction strategy is "qualified" by BAAQMD.

In late 2010, BAAQMD determined that San Francisco's GHG Reduction Strategy did so qualify, such that individual projects in the City that comply with the strategy will be deemed not to cause significant GHG impacts. Accordingly, rather than requiring the time-consuming and expensive exercise of quantifying each project's contribution to cumulative GHG emissions and determining whether those emissions are cumulatively considerable, project applicants will now be able to achieve a determination of no significant effect by instead demonstrating their project's compliance with the City's qualified GHG Reduction Strategy. Other local jurisdictions are seeking BAAQMD approval of their GHG Reduction Strategies as well, but San Francisco's is the first to be qualified.

The Planning Department has developed a GHG Checklist that applicants will now complete in order for the Department to determine a project's compliance. The checklist includes such items as the project's alternative transportation features, energy efficiency, water conservation and stormwater management, and waste reduction strategies.

Preliminary Project Assessments

A new type of preliminary review of projects was announced by the San Francisco Planning Department in January 2011, called Preliminary Project Assessment (PPA). As of February 1, 2011, a PPA is required for any project proposing to add six or more dwelling units or to construct more than 10,000 square feet of non-residential space. The project must go through the PPA process before the applicant may file any other application, including an environmental review application (until now the typical means of initiating formal project review). A PPA is designed to allow the Department to coordinate internal review of larger projects and provide preliminary feedback to applicants early in the development process. The Departments hopes to help applicants understand the approval process, identify Code and policy mandates that will apply, and become aware of potential issues that may need to be addressed before a development application is filed.

The result of the preliminary review will be a "PPA Letter" that is issued within 60 days of receipt of a complete PPA application. Issuance of a PPA letter is not a development approval or denial, but permits environmental review and other applications to be filed. There is modest fee required for a PPA application, but the process is designed to be fee neutral, such that the PPA fee will be deducted from the project's future application fees.

The PPA process will not foreclose the current opportunity project applicants have to request a "project review" meeting with the Department, but instead seeks to better document the informal advice applicants receive during preliminary project review meetings.

Inclusionary Housing

As described in an article in March 2010 in response to the Palmer court decision determining that inclusionary housing mandates on new rental projects violate state law, the City enacted interim zoning controls to require all residential projects to pay an Affordable Housing Fee unless the project qualifies for and chooses an alternative (on-site or off-site inclusionary units). The Board of Supervisors in December 2010 enacted permanent Planning Code amendments, and the Affordable Housing Fee and its alternatives are now codified in Section 415-415.9 of the Planning Code.

The amendments do not alter the options available to condominium developments. However, for rental projects, the Code now requires payment of the Affordable Housing Fee (previously referred to as the "in lieu fee"), unless the project sponsor enters into a Costa-Hawkins Act Contract signed by Planning Director reciting any public "incentives or concessions" provided to the project in exchange for on-site or off-site inclusionary units, or the sponsor enters into a Development Agreement, approved by the Board of Supervisors, contractually binding the sponsor to provide on-site or off-site inclusionary units.

Student Housing

In a first step toward encouraging the construction of new student housing in the San Francisco, the Board of Supervisors in late 2010 exempted student housing projects from the Affordable Housing Program altogether, provided certain qualifications are met, including that the housing is owned or master leased by an accredited educational institution and that a certain percentage of the students living in the student housing qualify for income-based financial aid.

Further incentives are now being developed for consideration by the Board, including new policies in the forthcoming General Plan Housing Element calling on colleges and universities to provide housing for their students and Planning Code amendments to relax density and parking requirements for student housing projects in certain locations.