A host of new court filings involving so-called "builder’s remedy" are raising questions about the impact that provision will have on California’s historic housing shortage and how it could affect production numbers in the state in the coming months.
The Californians for Homeownership (CFH) v. La Cañada Flintridge case was filed after officials in the Los Angeles suburb of La Cañada Flintridge wanted to deny a new housing development when their stock of affordable housing was already too low to comply with state law, CFH counsel Matt Gelfand, told the Southern California Record by email.
Under the so-called builder's remedy law, California cities can be legally barred from using their zoning authority to deny new developments with legally defined "affordable housing" elements, if those cities' housing stocks don't conform to affordable housing mandates required by the state.
“The judge ruled in our favor based on the City’s failure to rezone," Gelfand said.
The organization has filed roughly 20 housing element lawsuits since April 2022, Gelfand said.
“Those lawsuits are at various stages in the litigation process, and we have settled many of them in exchange for a stipulated judgment, where the city agrees to a court order requiring it to adopt its housing element on a specific timeline, and to comply with the ‘builder’s remedy’ in the meantime. Our next major trial is against the city of Beverly Hills, later this month.”
Local governments have known for years that these deadlines were looming, and compliance with housing element law still remains actually quite low, said Louis Mirante, vice president of public policy with the Bay Area Council.
For Southern California, the deadline for compliance was October 2022, and in the Bay Area it was January 2023. Most of San Mateo and Santa Clara counties may still not be in compliance.
But California’s Housing and Community Development (HCD) data shows they are not alone. According to the data, 190 of the state’s 539 jurisdictions are currently out of compliance, or about 35 percent.
Bringing a lawsuit is often the only way to get a local government to listen, Mirante noted.
“It's not anyone's first choice, and it's not the best solution,” Mirante said. “The best solution is just for the local government to do the right thing.”
The significance of the La Cañada Flintridge case, Mirante noted, is it’s the first time a court has opined on a technical disagreement between the housing proponent side and local government side over when the builder’s remedy applies.
“Local governments had previously argued, as La Cañada Flintridge did, that a housing element is compliant when the local government says it is, and the L.A. Superior Court found that is not the case. The court found that if local governments are not moving forward with their commitments, the builder’s remedy applies," Mirante said.
A jurisdiction’s compliance is based on meeting numbers in the California RHNA (Regional Housing Needs Allocation), which updates every eight years for every city, town, and county in the state. Recent legislation has also been passed to enforce compliance.
“Our state’s Housing Element Law is in place to ensure that all cities build their fair share of housing,” Attorney General Rob Bonta said in a news release. “No city is spared from that legal obligation. It is not a choice. It is the law.”
Still, many have also gone to court, wanting to decrease the number of new homes they must plan for, but haven’t won.
Recent figures from the California Association of Realtors show fewer than 20 percent of Californians are able to purchase a home at the state’s median price of $830,000. California has the lowest percentage of homeownership of all 50 states, KTLA reported.
Builders remedy should also be embraced because with so much unaffordable housing, it guarantees that at least 20 percent of a development is affordable, Mirante said.
“It’s required to qualify as a builder’s remedy project," Mirante said.
It’s not known how many builder’s remedy projects are currently moving ahead. Mirante said it could be close to 25,000 homes. Still, pushback that counters RHNA’s equity-based principles continues.
As UC Berkeley’s Terner Center describes it: “The RHNA process has the following objectives: 1. Increase the housing supply and the mix of housing types, tenure, and affordability in all cities and counties in an equitable manner.”
Meanwhile, as housing affordability and homelessness continue to rank as top issues for Californians, new bond measures have been proposed to help finance them.
While builder’s remedy has been a provision of California law since the 1990s, the housing crisis is making it a necessary tool, Mirante said.
“I don’t think we should reward local governments that don’t comply,” Mirante said. “This is really something that calls more fundamentally into question whether local governments are the right level of government to be making such major decisions about development.
“I think the fact that so many of them can’t even adopt compliant housing elements almost a year after the due date invites the Legislature to take over more and more authority on the housing and land use questions that California voters are so eager for their elected representatives to address.”