Newsom Signs Ambitious Bill to Boost Housing Density Near Public Transit

California has taken a major step to clear the way for developers across the state to build new, taller apartments near transit hubs.

Gov. Gavin Newsom signed legislation on Friday that would allow for the construction of denser multi-family housing in neighborhoods within a half-mile of bustling train and bus stops on major transit networks like BART, Caltrain or the L.A. Metro rail system, overriding local zoning laws. Buildings closest to the transit hubs could go up to nine stories.

The bill, SB 79, has been viewed as one of the most significant housing bills in decades. It’s state Sen. Scott Wiener’s latest of several attempts to spur new housing construction, a movement that has made political gains this year — and, at the same time, to increase public transit’s revenue by drawing new ridership.

“SB 79 is a historic step toward tackling the root cause of California’s affordability crisis — our profound shortage of homes and too few people having access to transit,” Wiener, D-San Francisco, said in a statement.

The bill, which will apply only to eight urbanized California counties with 16 or more passenger rail stations, also allows zoning for five- to eight-story buildings adjacent to light rail lines, as well as daily trains and rapid bus transit or streets with dedicated bus lanes. It takes effect July 1, 2026, in San Francisco, San Mateo, Santa Clara, Alameda, Sacramento, Los Angeles, Orange and San Diego counties, absent cities’ alternative plans for transit-oriented upzoning.

It will also allow transit agencies to set their own zoning rules on properties they own adjacent to transit-oriented development.

Proponents argue that a shortage of affordable housing has ensnared the state in an unaffordability crisis, exacerbated by “permitting, rezoning, and public funding barriers to build” affordable housing in the state, according to Wiener.

“We have [now] undone decades of housing prohibitions in our cities near the transit stations that we’ve all paid for, and we’ll start to see hopefully soon a [return] to the way California was envisioning its growth when we built these transit stations,” said Matt Lewis, a spokesperson for California YIMBY, a group that advocates for accelerating housing development.

Cities must meet the housing targets outlined in the state’s Regional Housing Needs Assessment to avoid lawsuits, losses in funding and other consequences, including what’s known as the “builder’s remedy,” which allows developers to sidestep local zoning restrictions if the city is out of compliance with state housing law.

Yet, how to achieve ambitious housing goals has caused controversy in a state where how and what to build is a touchy subject.

In San Francisco, city leaders are working on a plan to add more than 36,000 homes to the city’s west side and northern neighborhoods as part of a new “family zoning” push that would exempt these parts of the city from SB 79. If the Board of Supervisors doesn’t approve that plan by January, the state will start to impose fines and withhold critical funding for the city.

“There are real consequences if we fail to pass family zoning,” San Francisco Mayor Daniel Lurie said Friday in an Instagram post about the carveouts in SB 79. “The state is ready with what they call the builder’s remedy, which means unlimited height and density on every block and stripping the city of all decision-making power on new projects.”

In discussions in the Capitol, equity groups argued that the bill does not enshrine affordability requirements for new housing. Los Angeles Mayor Karen Bass urged Newsom to veto the bill, saying that it would “erode local control, diminish community input on planning and zoning and disproportionately impact low-resource neighborhoods.” And homeowner groups have said they fear the bill will affect the character of their neighborhoods and price out small businesses.

However, the bill cleared political hurdles and narrowly passed both houses of the Legislature after adding provisions for labor unions, and by exempting areas that are already covered by local housing policy that promotes transit. That allowed it to avoid the fate of Wiener’s previous three attempts in the last seven years.

Newsom’s decision was highly anticipated for weeks. His signing represents a significant step in California’s housing experiment, alongside several other housing bills signed Friday — including one to slash red tape around converting office buildings into residences and multiple bills meant to streamline the construction of accessory dwelling units.

KQED’s Adhiti Bandlamudi contributed to this report.