By Bob Christie
Capitol Media Services
PHOENIX – The Arizona Senate passed a measure on Wednesday that will require all larger cities to allow owners of single-family homes to build at least one attached and one free-standing accessory dwelling unit or casita on their lots as a way to help address the state’s huge housing shortage.
The passage of House Bill 2720 on a 17-11 vote came after weeks of negotiations and an amendment that, along with other changes, added that second unit as a right for homeowners.
But it still faces steep opposition from cities and some lawmakers from both parties. And one crucial reason is that it doesn't ban the use of those new units as Airbnbs or other short-term rentals.
Cities and their backers argue that the newly allowed garage conversions or backyard additions won't help the housing crisis, one purported reason for overriding local regulations.
That's not all.
One concern is whether new additions visible from the street would stand out like a sore thumb. There's nothing in the legislation that lets cities require the new additions match an existing home’s looks.
A number of cities, including Tucson and Phoenix, have already adopted ordinances allowing mother-in-law units. But a state law would override any conflicting parts of those rules.
The Senate also reached a breakthrough deal with cities and passed a second housing bill.
HB 2721 would require municipalities with a population of 75,000 or more to allow townhomes, duplexes, triplexes or quadplexes in all single-family zoned areas within a mile of their central business districts.
It originally would have required those more dense developments across anywhere in the city. Now, as part of that compromise, these could be built outside those central business districts only in all new developments of 10 acres or more anywhere in the city.
Both measures now go back to the House, which must approve the Senate changes before their go to Democratic Gov. Katie Hobbs for her signature or veto.
Hobbs said Wednesday that she has been clear in saying that cities, developers, affordable housing advocates and lawmakers must negotiate compromises before she will sign legislation overriding city zoning rules in the name of affordable housing.
“I think that has been happening,” Hobbs said. “So I'm looking forward to being able to get something that I can sign.”
The so-called “middle housing” bill -- the one on duplexes, townhomes and more -- is designed to fill a gap between rented apartments and traditional single-family homes that have become unaffordable for many families because of soaring prices and higher interest rates. It’s being pushed by developers and some housing advocacy groups.
The deal requiring cities to allow the townhomes and duplex developments near city centers could transform older single-family neighborhoods. Tucson’s central business district, for example, is within a mile of broad swaths of homes that could be purchased individually by developers, bulldozed and replaced with townhomes or "-plex'' developments that change the character of the area.
"This is where they wanted the development to happen, in the downtown areas where there’s a concentration of people,'' said Tom Belshe, executive director of the League of Arizona Cities and Towns in an interview before the vote.
"This is where the housing is needed,'' he continued. "I’m sure there’s going to be difficult decisions that are ahead but we feel like cities are prepared to do that.''
The deal on “middle housing” given Senate approval on Wednesday was a result of intense negotiations with the League, developers, advocates and lawmakers like Rep. Michael Carbone, R-Phoenix, who sponsored both measures.
Belshe's group still strongly opposes the accessory dwelling unit or ADU bill because it does not ban the use as short-term rentals, which he argues does nothing to address the shortage of affordable, permanent housing.
Sen Ken Bennett, R-Prescott, pressed that point during Wednesday's debate. He said that without a ban the bill "would have a devastating effect on many communities in Arizona, including some in my district.''
The issue of vacation rentals has been particularly acute in Sedona where more than 15% of housing stock is tied up with short-term rentals.
But Sen. Anna Hernandez, D-Phoenix, who helped craft the amendment adopted on Wednesday, noted that communities in Bennett's district like Prescott aren't covered because the measure applies only to communities of 75,000 or more. And she did have the measure amended to say that an owner must live in the main home if a new casita is going to be used as a short term rental.
Hernandez said that while she listened to Bennett’s concerns, she "does not want to be in a moment where we’re blocking out working class families'' from building an casita and getting more income that could help their quality of life.
"I don’t want to be a part of that,'' she said. She said using the additions as short-term rentals won't "destroy neighborhoods,'' as opponents contend.
"What we have seen is that what has destroyed our neighborhoods is that cities continue to uphold exclusionary zoning that have not let us for years to onboard diverse type of housing,'' Hernandez said.
"ADU's have wide support across political spectrums ,'' she said. "They have support across all kinds of communities.''
Bennett countered that he wasn’t a fan of the population thresholds in the bill that make a law apply to some cities but not others. That’s typically done by lawmakers on bills like the zoning proposals to limit opposition from rural lawmakers.
And he said if backers of the ADU bill were serious about addressing the housing crisis, they'd sideline the League’s concerns by agreeing to the short-term rental ban.
This legislative session has seen a raft of bills designed to help fix Arizona's big shortage of homes.
Hobbs vetoed the centerpiece of efforts by majority Republicans, a measure called the Arizona Starter Home Act, that earned bipartisan support. HB 2570 would have overridden local zoning rules and allowed small lots anywhere in larger cities while barring a host of other local rules affecting homebuilding.
In her veto letter, Hobbs called it a far-reaching "housing reform experiment'' that had unknown and far-reaching consequences.
Hobbs has signed some housing measures, including ones allowing conversion of some commercial property to apartments and another shortening the time cities are allowed to take to approve new developments.
She may not get a chance to act on another measure that the Senate debated on Wednesday, though.
That bill, House Bill 2584, would block cities from barring the use of some building materials. It was amended during debate to add parts of another bill vetoed by Hobbs that barred cities from requiring that new homes meet certain design standards.
That new amendment drew the ire of Sen. Jake Hoffman, R-Queen Creek, who said lobbyists testifying in support of the original bill in the committee he chairs said they were working to narrow its scope. Instead he said they inserted the design requirement ban, which he called a "wholesale expansion.''
"It is not OK and it is a bad precedent when bill sponsors and lobbyists will lie to committee chairmen,'' Hoffman said during a floor speech. "If it happens to one it will happen to all and this is not the first time this has happened related to housing bills.''
The measure was sponsored by Rep. John Gillette, R-Kingman. Sen. Sonny Borrelli, a Lake Havasu Republican who represents the same district as Gillette, stood up to defend him.
"I take exception to a member accusing another member, particularly my seatmate in my district, a liar,'' Borrelli said. "He did extensive work on this, we communicated, this is something that he’s comfortable with (and) he agreed to this amendment.''
The measure then failed on a 14-14 vote.
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Arizona Senate passes measure on affordable housing
