SB 35 / SB 423: ministerial approval where cities miss their housing targets

Section 65913.4 of the Government Code — SB 35 (2017), heavily amended by SB 423 (2023) — is the state's flagship streamlining statute, archived verbatim in the Housing Development Approvals chapter. Where a city or county has not made enough progress toward its Regional Housing Needs Allocation, qualifying multifamily projects on infill sites receive ministerial approval: objective standards only, no CEQA, no discretionary hearings, on statutory deadlines.

Whether the path is available — and at which affordability tier — depends entirely on HCD's periodic SMAP determinations. That single lookup should be the first diligence item on any site where you might want the ministerial route.

Jurisdiction: HCD publishes which jurisdictions are subject and at which tier. Missing above-moderate production → 10% lower-income set-aside track; missing lower-income production → 50% track. Many high-cost coastal cities cycle in and out — determinations update as APRs come in.

Site: urban infill, zoned (or planned) for residential or residential mixed-use, meeting the statute's environmental screens (wetlands, high fire severity, hazardous sites, prime farmland, etc.), and passing the standard protected-housing screens (no recent tenancies, rent-controlled units, or Ellis withdrawals on demolition sites).

Project: multifamily (2+ units), consistent with objective zoning/design standards, at least two-thirds residential square footage, and meeting the applicable labor standards.

• Underwriting watch-outs:
• SB 423 removed the old coastal-zone exclusion — coastal sites can now qualify, with coordination provisions replacing separate CDP discretion in certified areas.
• Mixed-use ground-floor retail counts against the two-thirds residential test — check the massing early.
• Objective standards are applied as they existed when the application was submitted — pair with an SB 330 preliminary application for maximum freeze.

The jurisdiction has 60 days (≤150 units) or 90 days (>150) to identify, in writing, every objective-standard conflict — silence waives them. Design review must finish, and approval issue, within 90/180 days. Standards must be objective: quantifiable, knowable to both parties in advance, involving no personal or subjective judgment.

• Underwriting watch-outs:
• Cities sometimes dress subjective judgments as objective standards — HCD's enforcement letters (e.g., the Huntington Beach notice in the library) are useful precedent when pushing back.
• Density bonus applications ride along: concessions and waivers under § 65915 must be processed within the same ministerial framework.
• The approval vests for at least 3 years (extendable with good-faith progress) — sequence financing accordingly.

Prevailing wage applies to projects of 10+ units. SB 423 restructured the healthcare and apprenticeship tiers for larger projects (generally 50+ units, with elevated obligations at 85+ units in some counties) — smaller infill projects escape the heavier tiers, which is where the statute is most attractive to small developers.

Price certified-payroll administration and wage deltas before choosing this path over a conventional entitlement in a cooperative jurisdiction: streamlining buys schedule certainty, not necessarily the cheapest build.