Concessions, waivers and parking caps: the rest of the § 65915 toolkit

Most coverage of the State Density Bonus Law (Gov. Code § 65915) stops at the bonus percentages. For underwriting, the rest of the toolkit usually matters more: § 65915(d) concessions that strip identifiable cost out of the building, § 65915(e) waivers that dissolve any standard blocking the bonus units, and § 65915(p) parking maximums the applicant can elect regardless of local code.

Parking now has a second, independent floor. AB 2097 (Gov. Code § 65863.2, codified in the state Zoning Law) bars minimum parking requirements outright within a half mile of a major transit stop — bonus project or not. Stack the two regimes and a transit-adjacent project can often design to market-demand parking, or none, before the density bonus even enters the analysis.

The concession ladder in § 65915(d) is set by the affordable mix: one concession at a 10% lower-income, 5% very-low-income, or 10% moderate-income set-aside (the moderate track counts only in for-sale common-interest projects); two at 20% lower / 10% very-low / 20% moderate; three at 30% lower / 15% very-low / 30% moderate; and four for a 100%-affordable project. A concession is an identifiable cost-reducing modification — reduced setbacks, added height, a revised unit mix, a mixed-use ground floor.

The default is a grant. A city may refuse only by making written findings, supported by substantial evidence, that the concession would not actually reduce costs, would cause a specific adverse impact on public health or safety that cannot feasibly be mitigated, or would violate state or federal law — and the burden of building that record sits with the city, not the applicant. HCD's State Density Bonus Law advisory stresses how narrow those outs are, and its sample ordinance template shows what compliant local processing looks like.

• Underwriting watch-outs:
• Spend concessions where the dollars concentrate — one story of height or a setback cut usually beats minor code relief. Model each candidate's cost delta before filing.
• State the cost-reduction rationale in the application even though the burden is the city's; it forecloses the "no identifiable cost reduction" finding.
• The moderate-income tiers work only for common-interest (for-sale) product — rental deals climb the ladder on lower- and very-low-income units.
• Never burn a concession on a standard that physically precludes the project: that is a waiver, and waivers sit outside the count.

Waivers under § 65915(e) are a separate track with no numeric limit. If a development standard — height, FAR, lot coverage, open space, stepbacks — would physically preclude construction of the project at its bonus density and with its granted concessions, the city must waive it, and the waiver does not count against the concession total.

The operative showing is geometric, not financial: demonstrate that the bonus unit count literally cannot fit inside the standard. A massing study mapping the compliant envelope against the bonus program is usually the whole argument, and no cost-reduction evidence is required.

• Underwriting watch-outs:
• Cities sometimes book a waiver request as a concession to run down the count — police the label in the staff report and resolution.
• "Physically preclude" is measured against the bonus project as proposed; keep the record tight on unit count, unit sizes and required floor area.
• Denial grounds are as narrow as for concessions — specific, evidence-backed health-and-safety impacts, not neighborhood character or compatibility.
• Ask for every needed waiver up front; discovering a preclusive standard after approval means reopening the entitlement.

Section 65915(p) lets the applicant elect statutory parking maximums for the whole project, market-rate units included: one space per zero-to-one-bedroom unit, 1.5 spaces per two-to-three-bedroom unit, and 2.5 spaces per unit with four or more bedrooms. Within a half mile of an accessible major transit stop with unobstructed access, eligible rental projects can elect 0.5 spaces per unit — and a 100%-affordable project that close to major transit can be required to provide no parking at all. The election is free: it does not consume a concession.

AB 2097 (Gov. Code § 65863.2) then works for everyone: a city may not impose any minimum automobile parking requirement on development within a half mile of a major transit stop, density bonus or not. The statute leaves only a narrow findings-based exception, and even that cannot be applied against projects with qualifying affordable units or small projects. Near transit, start the pro forma at zero required stalls and add only what leasing demands — at $40,000–$80,000+ per structured stall, parking relief is often the single largest value item in the § 65915 family.