Circulate San Diego and Assemblymember David Alvarez unveil AB 2433 plan to update California density bonus rules
A proposal to revise statewide density bonus rules
Circulate San Diego and Assemblymember David Alvarez have announced new legislation intended to revise California’s long-running Density Bonus Law, the state framework that requires cities and counties to provide additional development capacity and regulatory relief when housing projects include deed-restricted affordable units.
The measure, Assembly Bill 2433, was introduced February 20, 2026, and would amend Government Code section 65915. The bill proposes renaming the statutory framework commonly referred to as the “Density Bonus Law” as the “Affordable Homes Bonus Program,” while also changing how eligibility is triggered, how certain terms are defined, and how local governments must process qualifying projects.
Key changes in AB 2433
Program naming and terminology: The bill would formally rebrand the statute as the Affordable Homes Bonus Program and make conforming changes throughout the law.
Income-definition revisions: AB 2433 would expand overlapping definitions so that “moderate-income household” would include lower-, very low-, and extremely low-income households; “lower income” would include very low and extremely low; and “very low income” would include extremely low.
Floor Area Ratio option for base density: Where local rules rely on floor area ratio (FAR) and allow at least some residential use, AB 2433 would allow applicants to calculate base density using the site’s realistic residential development capacity based on FAR, and would include FAR increases within the definition of density bonus when that option is elected.
Use-by-right and ministerial processing in certain cases: The bill would require a housing development project that qualifies under an existing CEQA exemption for certain infill housing projects—and is also eligible for density bonus benefits under the program—to be treated as a use by right and processed through ministerial review.
Local processing timelines and notices: AB 2433 would require cities and counties to adopt procedures and timelines not only for processing density bonus applications, but also for notifying applicants that a project is eligible for program benefits.
How eligibility and approvals would be reframed
California’s density bonus framework generally operates by requiring local governments to provide a density bonus and related incentives when projects meet specified affordability thresholds, such as dedicating a defined share of units to lower-income or very low-income households, senior housing, certain student housing, or other qualifying categories.
AB 2433’s legislative digest describes a shift in phrasing toward requiring benefits when an applicant submits an application that the local government determines meets specified criteria, rather than when an applicant “seeks a density bonus.” The bill also proposes changes addressing how and where incentives, waivers, or reductions in development standards may be applied within a project.
AB 2433 is currently in the committee process in the California Assembly after being referred March 9, 2026, to multiple policy committees.
Context: recent density bonus expansions
The AB 2433 proposal follows recent state changes to density bonus incentives, including AB 1287, authored by Alvarez and signed into law in 2023, which established additional incentives tied to including moderate-income units under certain conditions and took effect January 1, 2024.
AB 2433 now advances a broader set of updates: restructuring definitions, clarifying administrative steps, and introducing an FAR-based pathway in jurisdictions where housing capacity is regulated through floor area ratio rather than dwelling units per acre.