-Minimum of 800 ft.² so if your house is 1200 square-foot you can still build an 800 square-foot ADU.Bill 670-Eliminates HOA’s from regulating ADU’sBILL 12-illuminates impact fees on ADU’s 700 ft.² or less.Bill 68 -If a property is zoned as a single family living home. bill 68 allows you to have three rental properties on it now.

The availability and prices of building materials could be impacted for new development, but for existing real estate and long-term buy and hold rentals, I don't see a major impact.

Yes you are essentially using an ARV approach of sorts. 

Cash out refi has no impact on your tax liability upon sale. 

The utilities and so forth that you paid reduce your rental income but aren't part of the basis of the property. ie, they don't impact the sale price profit of the property.You probably should find a CPA that can help you sort all this out as it seems like you may need to file some amended returns to cover the period since you bought the property.

Additionally there's another factor...the bank of mom is going to be loaning (gifting, essentially, as an early portion of our inheritance because more than likely she'll be fortunate enough to leave my brothers and I money when she passes way too soon due to this horrific disease) us money for the down payment on the new house.

I'm interested in understanding the impact of these limitations for passive investors.

When you increase the rent, it does not impact their income and therefore, the tenant’s rent portion does not change.  

You're not wrong in considering the impacts of it.

Essentially a parent LLC that holds assets with no liabilities.