HCD enforcement — Huntington Beach — Notice of Potential Violation: SB 35 / housing element

STATE OF CALIFORNIA - BUSINESS, CONSUMER SERVICES AND HOUSING AGENCY

GAVIN NEWSOM, Governor

DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT DIVISION OF HOUSING POLICY DEVELOPMENT 2020 W. El Camino Avenue, Suite 500 Sacramento, CA 95833 (916) 263-2911 / FAX (916) 263-7453 www.hcd.ca.gov

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February 13, 2023

Planning Commissioners:

Tracy Pellman, Butch Twining, Kayla Acosta-Galvan, Oscar Rodriguez, Ian Adam, Donn Strook, and Rick Wood

City of Huntington Beach 2000 Main Street Huntington Beach, CA 92648

Dear Planning Commissioners:

The California Department of Housing and Community Development (HCD) is aware that the Planning Commission of the City of Huntington Beach (City) will soon consider Zoning Text Amendment (ZTA) No. 2023-001 (Prohibition on “Builders Remedy” Applications). This letter incorporates by reference a previous Notice of Potential Violation sent by HCD to the City dated January 9, 2023, which addressed the invalidity of the legal arguments raised in Council Member Items Report 22-1096 for the December 20, 2022, City Council meeting (attached). The purpose of this letter is to notify the City that the adoption of the proposed ordinance would be unlawful and in violation of the Housing Accountability Act (HAA) (Gov. Code, § 65589.5).

Specifically, adopting such an ordinance would be an unlawful attempt to preempt the application of the HAA. In addition, the ordinance language is overbroad and would also violate other state laws applicable to the City by prohibiting “the processing or approval of any application for a housing development project or any project not in conformance with the zoning and General Plan land use designation….” For example, this language could prohibit a developer from applying for a density bonus under State Density Bonus Law (Gov. Code, §§ 65915-65918), seeking ministerial permit processing under SB 35 (Gov. Code, § 65913.4), and utilizing new laws such as SB 6 (Gov. Code, § 65852.24) and AB 2011 (Gov. Code § 65912.110 respectively), among others that do not require conformance with both zoning and general plan designations. It could also limit housing developers from requesting general plan amendments, zoning changes, variances and other typical permitting requests.

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In addition, limiting an ordinance to just affordable housing developments that qualify for protections under Government Code section 65589.5, subdivision (d), could pose a violation of fair housing law (Gov. Code, § 65008) which, among other provisions, prohibits the enactment or administration of ordinances that prohibit or discriminate against any residential development because the development is intended for occupancy by persons and families of very low, low, or moderate income. Such actions could also constitute a violation of the City’s obligation to take no action that is materially inconsistent with its obligation to affirmatively further fair housing (Government Code § 8899.50, subd. (b)).

Furthermore, as stated in HCD’s January 9, 2023, letter, the adoption of an ordinance limiting the applicability of state law would represent a new governmental constraint to the production of housing and would jeopardize the City’s pursuit of housing element compliance.

HCD reviewed Attachment No. 1, Suggested Findings of Approval for Zoning Text Amendment No. 23-001, and offers the following comments as it relates to the HAA:

• The HAA applies to all cities, including charter cities (Gov. Code, § 65585, subd. (g)).

• Findings Number 1 and 2 are declaratory of the existing general plan and zoning.

• Finding Number 3 is unnecessary to the application of the “Builder’s Remedy,” since, pursuant to Government Codes section 65589.5, subdivision (e), nothing in the HAA limits the application of the California Environmental Quality Act or Coastal Zone Requirements.

• The HAA does not guarantee the approval of a project if findings under Government Code section 65589.5, subdivision (d)(5), cannot be invoked. A jurisdiction can still apply Government Code section 65589.5, subdivision (d)(14). Finding Number 4 is; therefore, unnecessary as subdivision (d)(2) addresses possible nuisance violations on a project-by-project basis by allowing a jurisdiction to make findings of disapproval if a housing development project affordable to low- and moderate-income households “would have a specific, adverse impact upon the public health or safety, and there is no feasible method to satisfactorily mitigate or avoid the specific adverse impact without rendering the development unaffordable to or rendering the development of the financially infeasible.” A “specific, adverse impact” refers to “a significant, quantifiable, direct, and unavoidable impact, based on objective, identified written public health or safety standards, policies, or conditions as they existed on the date the application was deemed complete.” However, it should be noted that inconsistency with the zoning ordinance or general plan land use designation

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does not constitute a specific, adverse impact upon the public health or safety (Gov. Code, § 65589.5, subd. (d)(2)).

As stated in the January 9, 2023, letter, the legal challenges proposed in Items Report 22-1096 are not new and are unlikely to succeed. Similar challenges brought by other jurisdictions have failed. For example, the City’s status as a charter city does not exempt it from state housing laws, despite the Home Rule doctrine. (See Ruegg & Ellsworth v. City of Berkeley (2021) 63 Cal.App.5th 277, 310-315 [state housing law preempts conflicting charter city ordinance despite the Home Rule doctrine]; see also California Renters Legal Advocacy & Education Fund v. City of San Mateo (2021) 68 Cal.App.5th 820, 846-851 [same]; Buena Vista Gardens Apartments Association v. City of San Diego (1985) 175 Cal.App.3d 289, 306 [“[I]f a matter is of statewide concern, then charter cities must yield to the applicable general state laws regardless of the provisions of its charter.”])

HCD would like to remind the City that HCD has enforcement authority over the HAA, among other state housing laws. Accordingly, HCD may review local government actions and inactions to determine consistency with these laws. If HCD finds that a city’s actions do not comply with state law, HCD may notify the California Office of the Attorney General that the local government is in violation of state law (Gov. Code, § 65585, subd. (j)).

HCD will continue to monitor the City’s actions regarding the proposed ordinance, and if the City adopts an ordinance that violates state housing law, HCD will respond in order to remedy those violations. In addition, please be advised that the California Office of the Attorney General is also aware of this matter.

If you have questions or need additional information, please contact Brian Heaton at Brian.Heaton@hcd.ca.gov.

Sincerely,

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David Zisser Assistant Deputy Director Local Government Relations & Accountability

Attachment: January 9, 2023, Letter to Huntington Beach