The problem with declaring space to be used according to "biological sex" is that there is no consensus as to what that means. Rarely do such facilities have DNA testing readily available, and the results wouldn't be in before you wet yourself.
However, if they are referring to "biological function," it might make more sense. For example, if you stand to pee, use the urinals over there ----->.
Part of the problem is that not all trans people transition surgically, yet still need to pee and cannot do so shoulder-to-shoulder with the smelly guys from the locker room, nor should they be forced to.
Until the powers that be can learn that gender has nothing to do with anatomy, this issue will be staying around.