East Bay housing developers fear new law may increase costs

MARTINEZ, Calif. (KRON) — Housing developers in the East Bay are concerned that a new law aimed at facilitating affordable housing construction may actually increase costs.

California Gov. Gavin Newsom signed AB130 into law in June, intending to overhaul state regulations and remove barriers to new home construction. However, developers argue that a provision within the bill could lead to increased expenses, potentially exacerbating the housing crisis.

“This does nothing but exacerbate the problem that we are currently having,” said a representative from the Bay Area Building Industry Association. “This is going to add a tax of potentially $16,000 per unit.”

AB130 includes a provision that encourages developers to focus on projects with low vehicle miles traveled (VMT). If a new project is deemed to have high VMT, developers may be required to contribute to a fund for developing low VMT projects.

The Bay Area Building Industry Association views this requirement as a tax, arguing that the additional costs will ultimately be passed on to home buyers and renters.

Despite opposing the VMT provision, the association supports the rest of AB130 and is calling for the legislature to repeal this section.

State regulators are expected to establish specific rules for VMT payments by next summer.

All facts in this report were gathered by journalists employed by KRON4. Artificial intelligence tools were used to reformat from a broadcast script into a news article for our website. This report was edited and fact-checked by KRON4 staff before being published.