California cities may be justified to be skeptical when officials from Sacramento offer broad solutions to the state’s pernicious housing crisis.  But the decades-old crisis highlighted by a severe and unsustainable underproduction of new housing is real and getting worse, and the legislature is finally grappling with land use and housing policy proposals that would put meaningful guardrails on otherwise unfettered local control that has long stifled new housing supply.

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Senate Bill 330, known as the Housing Crisis Act of 2019 and authored by State Senator Nancy Skinner (D-Berkeley), passed the California legislature on Friday, September 6, 2019, with strong support from numerous organizations supportive of the production of new housing.  For a five-year period ending January 1, 2025, SB 330 would require local governments to process housing permits faster, prevent local governments from “changing the rules in the middle of the game,” and suspend certain housing limits.  Although various local agencies and groups that favor strong local land use control opposed SB 330, Governor Gavin Newsom has publicly championed substantial housing production goals and is certain to sign the bill.

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According to traditional urban economic models, developers in well-functioning housing markets will choose to build apartments where land is expensive and housing demand is strong.  The theory itself is sound: high rents provide strong financial incentives to developers that should lead to an increasing supply of new multi-family housing.

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On July 18, 2019, in Sacramentans for Fair Planning v. City of Sacramento, __ Cal.App.5th __ (2019), the Third District Court of Appeal affirmed a trial court decision denying a “vertical” consistency challenge filed by “Sacramentans for Fair Planning” after the City of Sacramento approved a15-story “high-rise” condominium building—known as the “Yamanee” project—in the City’s Midtown area.  The plaintiff group also challenged the City’s streamlined CEQA review of the project under a sustainable communities environmental assessment (“SCEA”).  My partner, Art Coon, analyzed those issues in the CEQA Developments blog.

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California law contains several critical limitations on the exercise of the police power conferred in Article XI, Section 7 of the state constitution.  As set forth in Government Code section 65858, the moratorium statute allows cities and counties to adopt 45-day “interim ordinances” to prohibit land uses that may conflict with a contemplated general plan amendment or another land use proposal the legislative body is studying or intends to study within a reasonable period of time.  Such ordinances can be extended so that the maximum term of the moratorium does not exceed two years.

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On April 3, 2019, in a case originally filed March 6, 2019, the First District Court of Appeal certified for publication Point San Pedro Road Coalition v. County of Marin, __ Cal.App.5th __ (Case No. A150002) (2019), an interesting opinion addressing the limits of the power local agencies have to approve changes to non-conforming land uses.

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Declaring there to be a statewide housing emergency, California state Senator Nancy Skinner (D-Berkeley) introduced Senate Bill 330, on February 19, 2019, to suspend certain regulatory restrictions on the development of new housing and to expedite the permitting of housing in certain high-cost regions for a 10-year period.

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On December 6, 2018, the California Attorney General issued an opinion (No. 14-403) in response to a request from Mendocino County Counsel Katherine L. Elliott to address three questions regarding the balance of land use regulatory authority between cities and counties.  According to the request, in 1993 an incorporated city acquired real property, outside the city limits, in an unincorporated area of the County.  When it acquired the property, the city assumed an existing lease that covered a portion of the property, becoming a lessor to the private business that was operating and continues to operate there.  The Attorney General was thus asked, in this context, to determine whether and under what circumstances a city and its private lessee may be exempt from the county’s building and zoning ordinances.

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California State Senator Scott Wiener is taking another whack at seriously addressing the state’s housing supply crisis with a bill that would create new state zoning requirements for high-density residential development near certain high-quality public transit.  And this time the bill would apply to certain communities that are considered to be “job-rich” by virtue of their proximity to jobs, high area median income, and high-quality public schools, even in the absence of high-quality transit.  This key part of the bill would help ensure that more affluent communities do their part to alleviate the state’s critical housing shortage.  At the same time, however, the bill seeks to protect against the displacement of renters and “sensitive communities” at risk of displacement.

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On August 23, 2018, the California Supreme Court held, in City of Morgan Hill v. Bushey, __ Cal.4th __ (2018) (Case No. S243042), that a referendum petition to challenge a zoning ordinance amendment that would bring the ordinance into compliance with the county’s or city’s general plan is valid, even though such a referendum would temporarily leave in place zoning that does not comply with the general plan, at least if the local agency has other means to make the ordinance consistent with the plan.  The Court reasoned that such a referendum simply keeps the underlying inconsistency in place for a certain time––until the local agency can make the zoning ordinance consistent with general plan.

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