CC 10-23-2024 Item No. 1. Statewide Housing Laws_PresentationCalifornia’s Housing
Laws: The “Builder’s
Remedy”
Barbara E. Kautz
Goldfarb & Lipman LLP
City of Cupertino
City Council Study Session
October 23, 2024
Presentation Overview
•Key State Laws
•The Builder’s Remedy
•Preliminary Applications (SB 330)
•Density Bonus Law
•Litigation to Date Regarding the Builder’s Remedy
•New State Laws Effective January 1, 2025:
AB 1886 and AB 1893
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The Builder’s Remedy
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Key Provisions
Applies to “affordable”
projects with:
•20% of the total units affordable
to lower-income households, or
•100% of the units affordable to
moderate-income households
•AB 1893 reduces affordability to
7 – 13%
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The Builder’s Remedy Provision
Additional finding to deny “affordable” projects:
•City meeting RHNA numbers;
•Specific adverse impact to public health and safety;
•Deny to comply with state or federal law;
•Proposed on agricultural land or water/sewer inadequate, OR
•Inconsistent with Zoning Ordinance & GP land use designation; BUT
must have a housing element in substantial conformance with
state law, and not on a site designated in housing element for
lower or moderate income housing.
•If housing element NOT compliant, cannot deny project no matter how
inconsistent with zoning and general plan
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Why Now?
•Enacted in 1982 as part of Housing Accountability
Act; but no published cases
•Many more cities not approved by HCD in sixth
cycle; much harder to be compliant
•Applies when Housing Element is not substantially
compliant with case law
•Publicized by UC Davis law professor; used in
Santa Monica; extensively publicized
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The Effect of Preliminary
Applications
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Preliminary Applications (“SB 330 Applications”)
“Preliminary application” freezes development
standards as of date all required info was submitted
•But project must meet these timelines:
•Project application must be filed within 180 days
•Applicant must complete application within 90 days of
receiving incomplete letter (HCD: applicant may continue to
resubmit)
•Can change project by up to 20% of square footage or
number of units or invoking density bonus and still rely
on initial preliminary application
•Can be submitted for ANY housing project.
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Other Key Processing Provisions
•Formal project application subject to Permit
Streamlining Act
•Must review for completeness within 30 days of each
submittal, or “deemed complete”
•Once complete, staff must notify applicant in short
time (30 or 60 days) if there are any
“inconsistencies” – or “deemed consistent” with all
City standards
•If “deemed consistent,” can probably not be denied for
inconsistency
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CEQA
If project requires discretionary
approval, CEQA still applies
•Many exemptions require general plan
and zoning conformance
•But not clear if general plan and zoning are
“applicable” to a “builder’s remedy” project
•Mitigation measures can be imposed
•But not if measures are “infeasible”
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Density Bonuses
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Density Bonus Law
•Eligible project: 5% to 100% affordable housing
•Eligible projects entitled to receive:
•A density bonus [20 – 100%, or unlimited];
•1 – 5 “incentives / concessions” [reduce costs]
•Unlimited waivers of development standards
•Reduced parking requirements.
•Density Bonus project = consistent with City standards
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Density Bonus Law and Builder’s Remedy
•Builder’s Remedy project with 20% affordable
housing is eligible for density bonuses
•Does not appear that projects submitted as
Builder’s Remedy projects can qualify as density
bonus projects because:
•Density more than 2X maximum density; or
•Density less than minimum density
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Builder’s Remedy Legislation
AB 1886 and AB 1893
Effective January 1, 2025
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Key Provisions
•Base density in Cupertino is greatest of:
•45 du/acre
•3x maximum density (90 du/acre if max density is 30
du/A)
•Density consistent with housing element
•Plus 35 du/acre in high opportunity areas
•At least 80 units/acre throughout Cupertino
•But no projects to date exceed this density
•May be doubled under density bonus law
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Key Provisions
•Reduces required affordability to 7%, 10%, or 13%
depending on affordability; based only on base
density
•City cannot apply its BMR ordinance unless can
show that this will not make project infeasible
•Provides 2 additional density bonus concessions
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Key Provisions
•Objective standards are those applicable to district
that allows density and type of building; if none,
developer may select standards
•BR projects are deemed to comply with City standards
•Developer may use SB 35 if complies with selected
standards (ministerial approval; no CEQA); but 50%
lower income
•Existing BR projects may elect to use new provisions
even if change by more than 20%; OR can continue to
use existing law
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Builder’s Remedy Litigation
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General Comments
•NO appellate published decisions
•All involve city as defendant
•AG has intervened
•HCD frequently submits declarations against
cities
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Few City Successes
•Trial courts (all SoCal) have agreed with HCD on
housing element adequacy
•Have found requirement to apply for rezoning
or GP amendment to be an effective denial
•Agree that preliminary application freezes the
status of the housing element
•Split on whether HCD approval is needed for
adequacy
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HCD and Attorney General Enforcement
•HCD Housing Accountability Unit with at least 25 staff
•Broader and broader authority
•Letters of Technical Advice
•Notices of Violation
•Referral to Attorney General
•Attorney General has 12-person strike force that acts
independently
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Active Third-Party Litigants
•Have sued at least 10 SoCal cities and 12 Bay
Area cities (Californians for Homeownership,
YIMBY, California Housing Defense Fund) on
housing elements
•Often join in, or are plaintiffs, in litigation
related to denials of housing development
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Housing Cases in General
•Courts:
•Generally very pro-housing
•Uphold housing approvals
•Overturn denials
•City risks:
•Significant attorneys fees exposure
•High defense costs
•Possible fines under new legislation
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Thank You!
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