SB 1117: A Very Good Housing Bill

UPDATE 4/14: The Arizona Senate voted down SB 1117 last night, continuing a shameful pattern of inaction on the housing shortage. Read our statement on this here.

Solving our housing crisis means making it easier to build more housing in places where people want to live. SB 1117 would be a major step towards this.

Arizona is in the midst of a housing crisis, driven by a shortage of housing of all types, at every income level. On Wednesday, the most promising bill yet to deal with the crisis passed on a bipartisan vote out of the state Senate Commerce Committee.

The bill is SB 1117 and it is packed with provisions that would make housing more affordable, abundant, and easier to build. Some of the biggest changes include increased height limits for multifamily housing, minimum lot sizes, and a full legalization of single-room occupancies (SRO’s). Let’s take a look at the bill, from top to bottom. 

A new state senate bill just dropped that would get housing built more quickly, more affordably, and more sustainably. SB1117 doesn’t have everything we want but it’s a great place to start, and here’s what’s in it…

— Tempe YIMBY (@YIMBYTempe) February 7, 2023

Parking & Lot Sizes

The bill eliminates off-street parking requirements for residential areas. It then establishes a 4,000 square feet minimum lot size for single family zones, meaning that cities can’t require lot sizes to be bigger than 4,000 square feet. It also lowers the minimum required setbacks to ten feet (or twenty feet for garages), and side yard setbacks to five feet. 

Practically, this means smaller houses and yards could be built in single-family zones, creating cheaper housing. Smaller homes are inherently more affordable than their larger counterparts, but in many cases they have been made hard to build under current zoning regulations, leading to the disappearance of the “starter home” across the country. 

Legalizing More Housing Options

Another change would have cities create new residential zones that allow duplexes, triplexes, lots smaller than 4,000 square feet, and other housing types. Further, cities must now allow single-room occupancies and accessory dwelling units (ADU’s). This would open the doors to more housing options that can be built more cheaply and for a wider range of incomes. 

Legalizing a greater variety of housing options prevents the status quo, where people of different backgrounds are crammed into the same portions of the housing market and forced to compete with each other. 

Allowing smaller houses and townhomes provides affordable options for people like young couples looking to start a family, keeping them from competing with single young professionals and college students for apartments. Lastly, legalizing single-room occupancies gives people down on their luck a place they can afford, even on minimum wage, preventing them from becoming homeless. 

More Housing Near Transit

In multifamily, commercial, or mixed use zones within two miles of a light rail stop, the height limit would be raised to 80 feet. If the development is in the right zone but outside the two miles, the minimum height limit would be 60 feet, or the highest allowed height within one mile of the development. 

This would mean areas like downtown Phoenix and Tempe will have higher height limits near the light rail, allowing more people to live next to and take advantage of public transit. In this way, the bill has a hidden climate element. By allowing more people to live next to public transit, and making it easier to build infill developments in already dense areas, we can help constrain sprawl and reduce dependency on cars and fossil fuels. 

A Less Arbitrary Development Process 

SB 1117 overhauls how developments are approved, seeking to make them an administrative process. The current process is a legislative one, city councils are given discretion by courts. An applicant could meet all requirements in an ordinance and still be denied. On the flip side, developers can get more than what they ask for if they have a good relationship with council members. 

An administrative process is formal and gives less discretion to council members. This means developers have to simply meet the existing requirements to get approved. The bill also gives a 30 day time limit for cities to approve projects, and up to 90 days if the application needs to be corrected. 

The current process actually advantages big developers. Building new housing takes lengthy negotiations and good relations with city officials. This requires resources that large developers can put up but which cut out smaller developers and nonprofits, who typically develop affordable housing. A more predictable approval process lowers the cost to build, meaning both nonprofit and for-profit developers charge lower prices.

The proposed changes don’t cut out public input. Neighbors can challenge proposed projects if they would be impacted by issues like traffic, noise, odor, and parking. Developers have to respond to these challenges, but the city can only require the developer to take the least restrictive means of mitigating the problem. Importantly, residents of cities already get to give feedback during the process of cities drafting their General Plans, which go before voters for approval.

The Time For Change Is Now

At the end of the day, this is a problem that requires a systemic overhaul and a statewide approach. Cities like Tempe have launched commendable initiatives like Hometown For All, which should be expanded and require further support. Regardless, the housing crisis requires more than piecemeal solutions to address the shortage. Tempe could do everything right and it would still amount to little if surrounding cities like Scottsdale block new units of housing.

No city exists in a vacuum. The housing market is an interconnected ecosystem. People who live in Scottsdale may work in Tempe, Phoenix, or possibly much further away. Many people currently live further away from work or school due to being unable to afford the cost of housing. 

Critics argue that this bill makes no provisions for truly affordable housing. While technically true, this argument is disingenuous. Chances are the reader of this piece lives in market-rate housing—as most people—even most lower income people do. 

This is not an argument against affordable housing, just the opposite. Firstly, many of the same barriers to building new market-rate housing are also faced by affordable housing.

Secondly, market-rate housing is complementary rather than incompatible with affordable housing. An increase in housing supply directly reduces home costs by reducing competition for a scarce resource (housing) and an even scarcer resource (affordable housing). We need much more of both. 

Cities are understandably interested in preserving the powers of cities. This is not always a bad thing, but it has come at too high a cost when it comes to housing supply. The status quo has clearly failed. It’s time to put people over process and make it easier to build abundant housing.

If you support abundant and affordable housing for all, we invite you to contact your State Senator in support of SB 1117. 

You can use this tool to look up your district.