SB 21 would allow limited unit reduction to modernize SROs into studios; sponsors say it preserves deeply affordable homes

SB 21, carried in committee by Sen. María Elena Durazo, would permit up to a 25% reduction in unit count when deed‑restricted single‑room occupancy (SRO) buildings are converted into larger affordable studio units that include private kitchens and bathrooms and supportive service space. The measure updates HCD eligibility rules for preservation projects and waives certain documentation barriers for SRO tenants for relocation purposes.

Sen. Durazo and nonprofit witnesses said many SRO buildings are functionally obsolete, losing revenue and becoming financially unsustainable because of shared bathrooms/kitchen arrangements, high vacancy and rising maintenance costs. Tiffany Spring (Southern California Association of Nonprofit Housing) and Holly Benson (Abode Communities) described a planned project at the historic Mary Andrews Clark Residence in Los Angeles: the conversion would modernize 106 deeply affordable units into studio apartments with private amenities and supportive services while preserving affordability covenants and securing rental vouchers.

Bill language includes tenant protections: right of first refusal to return after rehabilitation, rent guardrails, a replacement housing plan, and relocation assistance. Sponsors said the bill balances tenant protections with the preservation need: without conversion authority, nonprofits fear properties would be sold or shuttered and residents displaced.

Witnesses reported that Abode Communities had secured a PRP award (HCD Preservation Revolving Loan/Program funding) and rental vouchers contingent on the project moving forward; they urged the committee to approve SB 21 so preservation financing and tax‑credit applications could proceed. Committee members praised the bill as a balanced preservation tool and offered a motion to pass to Appropriations; the transcript records favorable committee action moving SB 21 forward.