BILL ANALYSIS
SENATE TRANSPORTATION COMMITTEE Bill No: SB 910
Senator KEVIN MURRAY, ChairMAN Author: dunn
VERSION: 4/24/01
Analysis by: Randall Henry
Fiscal:yes
SUBJECT:
General plans: housing elements.
DESCRIPTION:
This bill would require that specified transportation
funding be reduced to any city or county that fails to have
an approved housing element.
ANALYSIS:
Existing law:
Requires each city, county, or city and county to prepare
and adopt a general plan for its jurisdiction that
contains certain mandatory elements, including a housing
element. These entities are required to submit a draft
housing element or draft amendment to its housing element
to the Department of Housing and Community Development
for a determination of whether the draft complies with
state law governing housing elements.
Provides that in an action brought by any party to review
the conformity of a housing element with applicable state
law, a court review shall extend to whether the housing
element, or a portion or revision, substantially complies
with that law.
This bill would:
Require a court, on a finding that there is not
substantial compliance, to award the plaintiff reasonable
attorney's fees and costs and to levy a penalty not to
exceed specified amounts based on the population of the
city or county.
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Provide that all penalties shall accrue to the Housing
Supply Account, and that no money in that account shall
be expended except upon appropriation by the Legislature.
Existing law :
Provides that, in any action filed on or after January 1,
1991, challenging the validity of a housing element,
there shall be a rebuttable presumption of the validity
of the element or amendment if the Department of Housing
and Community Development has found that the element or
amendment substantially complies with the applicable law.
This bill would:
Provide that, in any action filed on or after January 1,
2002, challenging the validity of a housing element,
there shall be a rebuttable presumption of nonvalidity of
the element or amendment if the department has found that
the element or amendment does not substantially comply.
Require the State Controller to reduce by specified
percentages the monthly allocation of funds disbursed
under various fuel tax laws to any city, county, or city
and county whose third or subsequent revision of its
housing element is not in substantial compliance with
state law and that during the previous housing element
cycle did not adopt a housing element determined by the
department to be in substantial compliance with state
law, and to redistribute the money in the following
month.
Require the department to report to the State Controller
monthly a list of noncompliant jurisdictions.
COMMENTS:
1. Under current law, the cities and counties are required
on a specified basis to prepare and submit to the
Department of Housing and Community Development for
approval a so-called "housing element," which is a part of
the entity's general plan and consists of "an
identification and analysis of existing and projected
housing needs and a statement of goals, policies,
quantified objectives, financial resources, and scheduled
programs for the preservation, improvement, and development
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of housing." The housing element is required to "identify
adequate sites for housing, including rental housing,
factory-built housing, and mobilehomes, and shall make
adequate provision for the existing and projected needs of
all economic segments of the community."
2. According to the Department of Housing and Community
Development, over 60 percent of local entities in the state
are in full compliance with the law and have submitted the
necessary documents. Nearly 30 percent of cities and
counties, however, have not complied with this requirement,
and supporters of this measure contend that "these local
governments effectively raise the price of housing for
working families even higher and force surrounding
jurisdictions to take on a larger housing burden." Local
jurisdictions may not be in compliance with the housing
element requirement for a variety of reasons, including
such factors as disinterest in growing or providing
affordable housing or ongoing and thorny issues related to
providing additional housing in already high-growth areas.
3. The author argues that while state law mandates that
all local jurisdictions submit a housing element, there are
presently no really effective sanctions for non-compliance
or the submittal of inadequate documents. The supporters
further assert that the courts have limited ability to
bring about compliance, and the denial of government
housing funding is essentially meaningless for areas that
may not be interested in stimulating the construction of
additional housing units within their jurisdictions.
4. Editorializing in support of this measure, the Los
Angeles Times asserted that "(u)nless more housing is built
for average workers close to their jobs, costs for their
services will rise, commutes will get longer and slower and
air pollution will worsen. This is aside from the misery
caused to families who lack decent housing. The worst
examples have been in Silicon Valley, but Los Angeles and
Orange County also rate poorly on housing affordability and
availability."
5. To address the problem of non-compliance, this bill
would do the following:
Create a legal presumption that if the department
determines that an entity is not in compliance with the
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law, the housing element of the entity must be presumed
to invalid.
Provide that successful litigants in lawsuits involving
non-compliant housing elements shall be awarded
"reasonable attorney's fees and costs."
Specify financial penalties that could be levied by the
courts.
Writing in opposition to this measure, the League of
California Cities and California State Association of
Counties noted in part that:
Under current law, Section 65585 (f), Government Code,
a local government must submit a draft housing element
to HCD for review, but retains the discretion to
either incorporate the changes suggested by the HCD
plan reviewer, or adopt their element without the
state plan reviewer's recommendations with findings as
to why the changes are not incorporated, and why the
jurisdiction believes that its housing elements in
substantial compliance with state law. Under either
circumstance, the housing element is considered to be
in legal and in compliance with the law unless a court
rules otherwise. The supporters of this measure who
attempt to designate any element which fails to
incorporate all of the recommendations of state plan
as "out of compliance," simply distort the legal
reality. Furthermore, there is little established
nexus between approval of state plan reviewers and
housing production. . . .
6. In addition, the bill would require the State
Controller to reduce to those cities and counties that do
not comply with the housing element requirement their share
of the monthly allocation of funding from the revenues
collected from the per gallon tax imposed on gasoline and
diesel fuels. This funding would be reduced on a specified
percentage basis based on the length of time the local
entity is out of compliance with state law, and it would
not be reduced until: (1) "the third or subsequent revision
of (a) housing element" has been determined not to be in
compliance with state law; and (2) a local entity, "during
the previous housing element cycle, did not adopt a housing
element" that complies with state law.
Government Code Sec. 65588 provides the following deadlines
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for the third revision of the housing element:
December 31, 2000 for local governments within the
jurisdiction of the Southern California Association of
Governments.
December 31, 2001 for local governments within the
jurisdiction of the Association of Bay Area Governments.
June 30, 2002 for local governments within the
jurisdiction of the Council of Fresno County
Governments, the Kern County Council of Governments, the
Sacramento Area Council of Governments, and the
Association of Monterey Bay Area Governments.
June 30,1999 for local governments within the
jurisdiction of the San Diego Association of
Governments.
June 30, 2003 for all other local governments.
Commenting on this provision of the bill, the League of
California Cities and the California State Association of
Counties noted that:
(This provision) will now reduce our scarce local
subventions the portion of the state's gas tax that is
currently directly to a local government if our
housing element is found out of compliance by a state
plan reviewer. (It) take(s) our scarce transportation
dollars away from us if we choose not to incorporate
the changes that the HCD plan reviewer suggests,
reducing the portion of the state's gas tax that is
allocated directly to our communities. This is
nothing less than a direct usurpation of local land
use authority and revenues by the state. Furthermore,
this provision appears unconstitutional, based upon
Section 3, of Article XIX of the State Constitution
which requires "Any future statutory revisions shall
provide for the allocation of these revenues, together
with other similar revenues, in a manner which gives
equal consideration to the transportation needs of all
areas of the state and all segments of the
population?" (emphasis added)
7. Existing state law requires the imposition of a
gallonage tax of 18 cents on gasoline and diesel fuel
(federal law imposes an additional gallonage tax of 18.4
cents on these fuels). Under statutory allocation
formulas, cities and counties receive approximately 35
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percent of the revenues from the state gas tax, and under
Article XIX of the California Constitution these entities
are basically required to use these funds for the
"research, planning, construction, improvement,
maintenance, and operation" of local streets and roads.
The related funding categories that are referenced by this
measure and subject to possible reduction to non-complying
entities provided a total of approximately $1 billion to
the various cities and counties in 1998-99. And according
to the California Transportation Commission, cities and
counties reported "an estimated $10.5 billion in unfunded
needs for local road and street rehabilitation, to retire a
backlog of deferred maintenance statewide, plus an annual
shortfall of about $400 million to keep up with annual
maintenance and rehabilitation expenditure needs. The
backlog, built up since the 1970s, represents nearly 8
years of current annual rehabilitation needs."
The Committee may wish to consider the following policy
questions:
Is it appropriate to reduce funding that is essentially
unrelated to the issue of housing, such as local
transportation funding, because a local entity does not
have in place an approved housing element?
Is this penalty overly punitive?
Should the bill provide that the withheld funds would be
allocated to the out-of-compliance agency when its
housing element was approved and not forfeited entirely?
POSITIONS: (Communicated to the Committee before noon on
Wednesday,
4/25/01)
SUPPORT: Job-Center Housing Coalition (co-sponsor)
California Rural Legal
Assistance Foundation (co-sponsor)
(See attached list
provided by the author)
OPPOSED: League of California Cities
California State
Association of Counties
SB 910 (Dunn)
Page 7
(See attached list)
4/26/01