BILL ANALYSIS �
SENATE TRANSPORTATION & HOUSING COMMITTEE BILL NO: AB 325
SENATOR MARK DESAULNIER, CHAIRMAN AUTHOR: alejo
VERSION: 5/29/13
Analysis by: Mark Stivers FISCAL: no
Hearing date: June 25, 2013
SUBJECT:
Statute of limitations and remedies for specified
housing-related challenges
DESCRIPTION:
This bill allows an entity in support of affordable housing to
initiate a challenge to a housing element or a specified city or
county housing ordinance within three years of adoption, except
for an HCD-approved housing element.
ANALYSIS:
The Planning and Zoning Law requires cities and counties to
prepare and adopt a general plan, including a housing element,
to guide the future growth of a community. Following a
staggered schedule, cities and counties located within the
territory of a metropolitan planning organization (MPO) must
revise their housing elements every eight years, and cities and
counties in rural non-MPO regions must revise their housing
elements every five years. These five- and eight-year periods
are known as the housing element planning period.
Before each revision, each community receives its fair share of
housing for each income category through the regional housing
needs assessment (RHNA) process. A housing element must
identify and analyze existing and projected housing needs,
identify adequate sites with appropriate zoning to meet its
share of the RHNA, and ensure that regulatory systems provide
opportunities for, and do not unduly constrain, housing
development. The Department of Housing and Community
Development (HCD) reviews both draft and adopted housing
elements to determine whether or not they are in substantial
compliance with the law. Many of HCD's grant programs require a
city or county to have an HCD-approved housing element in order
to be eligible for funding.
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The Planning and Zoning Law and the Subdivision Map Act also
include a number of sections governing zoning and entitlements
specifically related to housing, including:
The Housing Accountability Act, which requires a city or
county to make one or more specified findings in order to
disapprove a particular housing development.
A provision requiring cities and counties, when adopting an
ordinance that limits the number of housing units that may be
constructed on an annual basis, to make findings as to the
public health, safety, and welfare benefits that justify
reducing the housing opportunities of the region.
Density bonus law, which requires cities and counties to grant
a developer a density bonus, incentives, and concessions when
the developer proposes to include specified percentages of
affordable housing within a development.
The Least Cost Zoning Law, which requires cities and counties
to designate and zone sufficient vacant land for residential
use with appropriate standards to meet housing needs for all
income categories and to contribute to producing housing at
the lowest possible cost.
A requirement that, when determining whether to approve a
tentative subdivision map, a city or county shall apply only
those ordinances, policies, and standards in effect as of the
date the developer's application is deemed complete.
Prior to a recent court decision, it was understood that current
law (Government Code Section 65009) allowed a party to challenge
the adequacy of a city's or county's housing element at any time
during a planning period, provided that the challenger brought
the action "in support of or to encourage or facilitate the
development of housing that would increase the community's
supply of [affordable] housing." The challenging party was
required first to serve the city or county with a notice
identifying the deficiencies in the housing element. After 60
days or the date on which the city or county took final action
in response to the notice, whichever occurred first (referred to
below as "the lapsing of the notice period"), the challenging
party had one year to file the action in court. This process
and statute of limitations is known as the "notice and accrual
provision" and also applied to actions brought pursuant to the
housing-related statutes listed above.
In 2006, Urban Habitat Program brought suit to challenge the
City of Pleasanton's housing policies, including the city's
annual cap on housing permits and the city's cap on the
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aggregate number of permissible housing units, both of which
Urban Habitat claimed were insufficient to allow the city to
meet its RHNA obligation. In 2008, the First District
California Court of Appeals issued an unpublished decision in
the case of Urban Habitat v. Pleasanton allowing the case to
proceed with respect to some causes of action but ruling that
the challenge to the housing element itself was time-barred.
The court concluded that, while the statute does not specify the
time within which a party must deliver the deficiency notice to
the city or county, it must interpret the statute as containing
a time limit. The court then set the deadline for serving a
notice at 90 days after the legislative action to adopt the
housing element or ordinance at issue.
In other words, instead of being able to initiate a challenge to
a deficient housing element at any time during the planning
period, housing advocates and other interested parties may now
only initiate such a challenge by submitting a deficiency notice
within 90 days of the housing element's adoption.
Current law also requires a court, if it finds any portion of a
general plan, including a housing element, out of compliance
with the law, to include within its order or judgment one or
more of the following remedies for any or all types of
developments or any or all geographic segments of the city or
county until the city or county has complied with the law:
Suspend the authority of the city or county to issue building
permits.
Suspend the authority of the city or county to grant zoning
changes and/or variances.
Suspend the authority of the city or county to grant
subdivision map approvals.
Mandate the approval of building permits for residential
housing that meet specified criteria.
Mandate the approval of final subdivision maps for housing
projects that meet specified criteria.
Mandate the approval of tentative subdivision maps for
residential housing projects that meet specified criteria.
This bill states the intent of the Legislature to modify the
portion of the Urban Habitat opinion relating to the statute of
limitations for using the Government Code 65009 notice and
accrual provision limits the applicability of the notice and
accrual provision, and generally provides a three-year time
frame for parties to initiate an action "in support of or to
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encourage or facilitate the development of housing that would
increase the community's supply of [affordable] housing," unless
the action relates to a HCD-approved housing element.
Specifically, the bill:
States the intent of the Legislature to modify the court's
opinion in Urban Habitat Program v. City of Pleasanton with
respect to the interpretation of Section 65009 of the
Government Code.
Removes from the current list of city or county actions that a
party may challenge pursuant to the Government Code 65009
notice and accrual provision those actions related to the
Housing Accountability Act, the Subdivision Map Act, and the
application of a Density Bonus ordinance to a particular
project, all of which are project-specific actions. The bill
maintains the ability to use the notice and accrual provision
to challenge the adequacy of a city's or county's density
bonus ordinance generally.
Except as described in the next bullet, provides that an
entity bringing a challenge in support of affordable housing
against a city or county action relating to housing element
law, the Least Cost Zoning Law, annual limits on housing
permits, or the adequacy of a density bonus ordinance may
serve a deficiency notice up to three years after the city's
or county's action. After the lapsing of the notice period,
the challenging party has one year to file an action in court.
Provides that a party challenging an adopted housing element
that HCD has found to be in substantial compliance with the
law must serve a deficiency notice within 270 days of the
adoption of the housing element and file an action in court
within 6 months of the lapsing of the notice period.
Clarifies that in any action brought pursuant to the notice
and accrual provisions of Government Code Section 65009,
neither the court remedies described above nor any injunction
against the development of a housing project shall abrogate,
impair, or otherwise interfere with the full exercise of the
rights and protections granted to an applicant for a tentative
map or a vesting tentative map under specified provisions of
the Subdivision Map Act or to a developer under a specified
provision relating to development agreements.
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Provides that if a third-party challenges the adequacy of a
housing element and the court finds that the housing element
substantially complies with all of the requirements of housing
element law, the element shall be deemed to be in compliance
for purposes of state housing grant programs.
COMMENTS:
1.Purpose of the bill . According to the author, this bill
corrects a flawed court ruling that held that citizens may
only challenge the adequacy of a city's or county's housing
element for 90 days from the date of adoption. Combined with
the recent change to an eight-year housing element cycle, the
ruling holds the potential for more than seven years of bad
land-use decisions with little recourse for citizen action.
2.A brief history of the statute . The statutory language
interpreted by the court and at issue in this bill was added
to statute by AB 998 (Waters), Chapter 1138, Statutes of 1983,
a bill sponsored by the League of California Cities and the
California Building Industry Association. AB 998 created a
short statute of limitations period for land use decisions
generally but provided a specific exception to protect the
ability to challenge deficient housing elements. The Senate
Housing and Land Use Committee and the Senate Third Reading
analysis of the bill stated that the bill:
Specifies that for challenges in support of low- and
moderate-income housing requirements, the petitioner shall
notice local government 60 days prior to filing action.
The [one-year] statute of limitations then begins on the
first day the legislative body fails to act.
In the intervening 25 years prior to the Urban Habitat ruling,
housing advocates filed and successfully settled at least ten
cases in which the 60-day deficiency notice was sent more than
90 days after adoption of the city's or county's housing
element. In none of these cases was the timeliness on the
advocates' suit contested. Likewise, six bills amended other
portions of this statute during those intervening years, and
there was never any controversy surrounding the lack of a
deadline for housing advocates to serve a deficiency notice
nor any attempt to change the statute in this regard.
3.The importance of being able to challenge on-going policies .
Creating certainty by maintaining a short time frame for legal
challenges is important for individual development projects.
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Housing elements, zoning ordinances, growth control
ordinances, and density bonus ordinances, on the other hand,
are living documents meant to guide cities' and counties'
current and future land use decisions. When a housing element
or such an ordinance fails to comply with state law, it is
important that it be correctable whenever the deficiencies are
identified. In recognition of the difference between specific
project-related decisions and general policies guiding future
development, this bill deletes the ability of affordable
housing advocates to use the Government Code 65009 notice and
accrual provision to challenge a project specific decision
under the Housing Accountability Act, the Subdivision Map Act,
or a density bonus ordinance while maintaining the notice and
accrual provision for challenging on-going policies.
There are also logistical reasons for an on-going enforcement
period for housing elements. The state generally does not
enforce housing element or other affordable housing laws
directly. Enforcement relies on local governments' voluntary
compliance with the possibility of citizen enforcement
actions, most often by affordable housing advocacy groups.
There are not many of these nonprofit organizations in the
state, and their resources are spread very thin. They simply
do not have the ability to monitor the adoption of all the
state's housing elements in real time and immediately file
deficiency notices. Moreover, most of these groups are local
and faced with the fact that all jurisdictions within a region
adopt their housing elements around the same time. The area
covered by the Southern California Association of Governments,
for instance, includes 200 jurisdictions. As long as housing
element and other affordable housing laws rely on citizen
actions for enforcement and the resources of nonprofit citizen
groups are limited, effective enforcement requires allowing a
meaningful opportunity to raise alleged violations more than
90 days after adoption. While there is no apparent policy
rationale for setting any time limit on such challenges, this
bill offers a compromise by allowing potential challengers to
serve a deficiency notice only within three years of adoption
of the housing element or specified ordinance.
4.Unlocking the private market . The purpose of housing element
law is to create opportunities for the private housing market
to function. Builders cannot build without access to
appropriately zoned land, and current land use plans in many
cities and counties in California fail to provide sufficient
opportunities to accommodate projected population growth. The
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San Diego Association of Governments' Regional Comprehensive
Plan describes this typical California paradox in the
following way:
Under current plans and policies, more than 90 percent of
[the San Diego region's] remaining vacant land designated
for housing is planned for densities of less than one home
per acre, and most is in the rural back country areas
dependent upon scarce groundwater supplies. And of the
remaining vacant land planned for housing in the 18
incorporated cities, only about seven percent is planned
for multifamily housing. When taken together, the current
land use plans of the 19 local jurisdictions do not
accommodate the amount of growth anticipated in our
region?As a result, home prices will continue to skyrocket,
forcing many to abandon their dreams of home ownership or
move to neighboring areas with less expensive housing
costs. These people, who teach our children, police our
neighborhoods, and bag our groceries, often become
long-distance commuters, and with few transit options, our
freeways become more and more congested. The result for
our region will be an ongoing housing crisis and worsening
traffic.
Housing element law addresses this problem directly by
requiring cities and counties to zone land at appropriate
densities to accommodate the projected housing needs of all
income groups and to remove constraints that prevent such
sites from being developed at the allowed densities. Cities
and counties, however, are not required to build housing
because that is the role of private developers. The law holds
cities and counties accountable only for that which they
control: zoning and land use entitlements. Without the
ability to enforce housing element law, the market's ability
to meet housing demand may well remain locked up.
5.Key to AB 32/SB 375 implementation . In 2006, the Legislature
enacted AB 32 (Nu�ez), Chapter 488, the Global Warming Act of
2006, which requires the Air Resources Board to establish a
statewide greenhouse gas emissions limit such that by 2020
California reduces its greenhouse gas emissions to the level
they were in 1990. One of the key strategies to achieve the
AB 32 mandate is to promote more compact forms of development
in California. In 2008, the Legislature enacted SB 375
(Steinberg), Chapter 728, which requires the Air Resources
Board to provide each major region of the state with
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greenhouse gas emission reduction targets for the automobile
and light truck sector and requires the regional
transportation plan to include a Sustainable Communities
Strategy (SCS), including a regional land use plan, designed
to achieve the targets for greenhouse gas emission reduction.
Regional transportation planning agencies, however, do not
have land use powers. To achieve the land use vision laid out
in the SCS, cities and counties must alter their general plans
and zoning ordinances to allow the types of development the
SCS contemplates. These city and county actions are
voluntary, however. SB 375 contains no requirement for a city
or county to conform its land use plans to the SCS.
Because a region's RHNA housing need allocation must be
consistent with the SCS, because housing element law requires
cities and counties to identify adequately zones sites or
rezone land to accommodate lower-income housing, and because
density is the proxy for affordability, housing element law is
currently the only tool to get cities and counties to increase
allowable housing densities needed to achieve the SB 375
regional greenhouse gas emission reduction targets. Without
an effective way to enforce housing element law, the only tool
to effectively ensure implementation of SB 375 at the local
level is lost.
6.Current level of housing element compliance . According to
HCD, 83 percent of cities and counties have adopted an
HCD-approved housing element for the current planning period.
7.Arguments in opposition . Local government opponents argue a
three-year notice period (which makes the ultimate statute of
limitations over four years when the response and filing
periods are added) does not increase compliance or build more
affordable housing but results only in expensive lawsuits that
change just a few portions of a housing element. They argue
that the bill creates uncertainty for cities and counties as
well as developers for over four years while housing
advocates, project opponents, and others decide whether or not
to sue. These four years represent almost the entire planning
period for rural cities and counties with a 5-year housing
element cycle and half the planning cycle for all other
jurisdictions, and litigation would continue beyond or almost
to the adoption of the next housing element, at which point
opponents believe it makes more sense for potential litigants
to weigh in on the adoption of the next housing element.
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Opponents also believe that the shorter statute of limitations
for cities and counties with HCD-approved housing elements
should apply additionally to the other types of
housing-related challenges described above and not just to
housing element challenges themselves.
The Civil Justice Association opposes lengthening statutes of
limitations generally. They believe memories fade, witnesses
become difficult to locate, and courts are less likely to be
fair. Moreover, short statutes of limitations encourage the
diligent settling of claims.
8.Previous legislation . Twice in the last three years, the
Legislature has approved a bill very similar to this one. AB
602 (Feuer) of 2010 allowed entities to serve a deficiency
notice within five years of adoption of a housing element or
specified housing ordinance. Governor Schwarzenegger vetoed
AB 602, stating:
Local governments face numerous potential legal liabilities
when land is developed. One of the protections and
assurances provided to local governments in order to
encourage them to move forward with land development is
that there is a reasonable statute of limitations on when a
legal claim can be filed. Existing law gives interested
parties sufficient time to bring an action, and extending
this period to five years could result in uncertainty for
local governments.
AB 1220 (Alejo) of 2011 reduced the period in which an entity
may serve a deficiency notice to three years. Governor Brown
vetoed AB 1220, stating:
While I understand the value of using the courts to compel
compliance with state housing goals, there should be a
balance between a local government's planning authority and
citizen oversight. This bill tilts that balance and creates
too much uncertainty.
This bill differs from AB 1220 in that it provides that a
party challenging an HCD-approved housing element must serve a
deficiency notice within 270 days of the adoption of the
housing element and file an action in court within six months
of the lapsing of the notice period.
Assembly Votes:
AB 325 (ALEJO) Page 10
Floor: 41-30
L. Gov.: 5-3
H&CD: 5-2
POSITIONS: (Communicated to the committee before noon on
Wednesday, June 19,
2013.)
SUPPORT: California Rural Legal Assistance Foundation
(sponsor)
Housing California (sponsor)
Western Center on Law and Poverty (sponsor)
California Association of Realtors
California Coalition for Rural Housing
Congress of California Seniors
Housing Advocacy Group
Mammoth Lakes Housing
Public Advocates
Non-Profit Housing Association of Northern
California
Transform
Urban Habitat
OPPOSED: American Planning Association - California
Chapter
California State Association of Counties
City of Alameda
City of Alhambra
City of Brawley
City of Burbank
City of Camarillo
City of Claremont
City of Clayton
City of Concord
City of Cypress
City of Danville
City of Del Mar
City of Diamond Bar
City of El Centro
City of Encinitas
City of Fairfield
City of Folsom
City of Fountain Valley
City of Fremont
City of Fresno
City of Grass Valley
AB 325 (ALEJO) Page 11
City of Inglewood
City of La Ca�ada Flintridge
City of Lafayette
City of Lakewood
City of La Mirada
City of Lathrop
City of Moorpark
City of Norwalk
City of Ontario
City of Orinda
City of Pleasant Hill
City of Pleasanton
City of Pomona
City of Poway
City of Rancho Cucamonga
City of Reedley
City of Roseville
City of Sacramento
City of San Diego
City of San Gabriel
City of San Luis Obispo
City of Santa Barbara
City of Santa Monica
City of Santa Rosa
City of Scotts Valley
City of South San Francisco
City of Sunnyvale
City of Thousand Oaks
City of Torrance
City of Tracy
City of Tulare
City of Visalia
City of Vista
City of Wasco
City of West Hollywood
City of Whittier
Civil Justice Association of California
County of Lassen
County of Marin
County of Orange
County of Sacramento
County of San Diego
County of Tulare
Marin County Council of Mayors and Councilmembers
League of California Cities
Rural County Representatives of California
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Town of Atherton
Town of Hillsborough