Pending State Housing Laws: Rebuilding After a Natural Disaster

Various state housing bills are currently making their way through the California State Legislature that are expected to benefit mixed-income multifamily housing developers. The following summaries reflect the status of the pending legislation as of June 6, 2025. Future amendments are expected. Important upcoming dates in the legislative process include: 

• September 12, 2025 – final date for the Legislature to pass bills.
• October 12, 2025 – final date for the Governor to sign or veto passed bills.
• January 1, 2026 – default effective date for approved bills (unless otherwise specified).

ASSEMBLY BILL 818: REBUILDING ON RESIDENTIAL PROPERTY

AB 818 (Ávila Farías and Wicks) would address residential rebuilding after a disaster, which is defined to mean “a fire, flood, storm, tidal wave, earthquake, terrorism, epidemic, or other similar public calamity that the Governor determines presents a threat to public safety.”

AB 818 would apply to residential real property that was affected by a disaster (that resulted in a declared local emergency) and as a result, the property was destroyed, was declared a substandard building (as defined), and/or is effectively a substandard building (Affected Property). The Affected Property must have been deemed safe for development by the state and/or local agency (Safe Affected Property).

The term “local emergency” is defined to mean “a condition of extreme peril to persons or property proclaimed as such by the governing body of the local agency affected” pursuant to Gov. Code § 8630, which in turn requires the governing body to review the need for a proclaimed local emergency at least every 60 days until the local emergency is terminated.

As currently proposed, AB 818 would:

• Require a local agency to approve an application, within 14 days of receipt, for a construction permit for any of the following structures on a Safe Affected Property that is intended to be used by a person until the rebuilding or repairing of a Safe Affected Property is complete:
  • A state or federally approved modular or prefabricated home.
  • A detached structure that would meet the applicable requirements to be an accessory dwelling unit (ADU) on the Safe Affected Property.
  • A structure “similar to those” described above.
• Provide that specified state law requirements for solar panel installations and associated energy storage systems shall not apply to a project for which an application for a permit necessary to rebuild or repair a Safe Affected Property is approved by a local agency.
• Provide that if a local agency approves a permit to rebuild or repair a Safe Affected Property, the utility provider must provide a written notice describing the next steps in the approval process for a connection request for the project within 30 days of receipt of the connection request, unless connection is infeasible due to the disaster.
• Require local agencies to provide: (i) a checklist of the conditions for a substandard building; (ii) notice that a confidential third-party code inspection from a licensed contractor may be obtained prior to application submittal; and (iii) a dashboard that tracks permitting timelines and agency performance. Local agencies must comply with these requirements by March 31, 2028.
• AB 818 would facilitate the speedy approval of modular and prefabricated homes and ADUs on residential properties destroyed (or effectively destroyed) due to a natural disaster other similar public calamity. AB 818 was initially intended to apply more broadly, but has since been amended to exclude provisions related to local agency approval of a permit necessary to otherwise rebuild or repair a residential property affected by a disaster within a specified timeframe. AB 818 was passed by the Assembly on May 23, 2025, and has been ordered to the Senate. 

ASSEMBLY BILL 961: EXTENSION OF CALIFORNIA LAND REUSE AND REVITALIZATION ACT OF 2004

AB 961 (Ávila Farías) would extend the California Land Reuse and Revitalization Act of 2004 (which would be repealed on January 1, 2027 under current law) to January 1, 2037. As explained in AB 961:

The California Land Reuse and Revitalization Act of 2004 provides, among other things, that an innocent landowner, bona fide purchaser, or contiguous property owner, as defined, qualifies for immunity from liability from certain state statutory and common laws for pollution conditions caused by a release or threatened release of a hazardous material if specified conditions are met, including entering into an agreement for a specified site assessment and response plan. The act prohibits the Department of Toxic Substances Control, the State Water Resources Control Board, and a California regional water quality control board from requiring one of those persons to take a response action under certain state laws, except as specified.

IMPLICATIONS

Among other scenarios, AB 961 could help address site contamination issues that result from a natural disaster. AB 961 passed by the Assembly on June 2, 2025, and has been ordered to the Senate.