It’s uncharted territory – an untested state law that’s surfaced across Southern California and could play itself out in the courts.
But it might be closer to becoming reality in Orange County cities like La Habra and Orange.
It’s commonly referred to as “builder’s remedy,” what was until now an obscure 1990 law that aimed to take municipalities to task on expanding California’s housing stock and combatting dizzying rents and living costs up and down the picturesque state.
The law got some teeth with the passage of the Housing Crisis Act of 2019, empowering developers to ignore local zoning codes in order to build their projects if the plans contain 20% of affordable housing.
But only if a city’s straggling on submitting its long term housing development plans, a municipal planning document known as the Housing Element.
The ideas, on paper, are casting a long shadow across Orange County cities who are late on mapping out their state-required housing construction goals and, as a result, might have to sit back and watch as developers build apartments and condos regardless of city approval.
Local zoning codes in many of OC’s affluent communities have long worked to cap building heights and population density, often endorsed by property-owning residents with home values and car traffic in mind.
It’s also a region where local officials have historically pushed back against state housing demands.
At the same time, OC is one of the most populous counties in the entire U.S., and counted more than 5,700 homeless people within its borders as of last year.
Meanwhile, more than half of its cities still have yet to finalize their home-building goals in the Sacramento-required document called the housing element.
In such cities, under Builder’s Remedy, developers can propose projects that disregard local zoning codes – as long as 20% of the project’s units are affordable to low-income people.
And this year, such projects may already be materializing in La Habra and Orange, the latter of which just re-adopted its housing element at the City Council’s regular meeting on Tuesday night.
Yet new elected city council members in Huntington Beach are mounting a resistance to the law, bringing legal threats from the state Attorney General.
[Read: Sacramento Tells Huntington Beach To Back Off Housing Fight Against Builders’ Remedy]
“Where there is lack of clarity or even hostility, which we are seeing in Huntington Beach, then I think that that’s a remedy that’s going to be looked at more carefully, because there probably won’t be any other way to push it through (without) these types of requirements,” said Cesar Covarrubias, executive director of the Kennedy Commission, in a phone interview Wednesday.
The nonprofit he steers started as all-volunteer advocacy for affordable home building throughout the county, and the group’s work helped bring about projects like the Vista del Rio in Santa Ana, Citrus Grove in Orange, and the Alegre Apartments in Irvine, to name a few.
The group’s director said the law is a necessary tool to help address the critical need and shortfall of affordable housing in Orange County – along with cities having clear roadmaps for future housing stock called housing elements.
“We probably will see a lot more of these challenges, just because some of the cities where it’s going to happen don’t have a clear map as to how development will be incentivized, specifically affordable housing,” Covarrubias said.
The mayor of Orange, however, is irked by the idea Builder’s Remedy can skirt the city’s zoning code.
“The state is interfering way too much in the name of affordable housing,” said Mayor Dan Slater in a Wednesday phone interview. “It’s unreasonable and unprecedented.”
So far, 14 cities across Orange County have housing plans that are approved by the state, according to a state dashboard and the Kennedy Commission database.
This includes: Brea, Cypress, Dana Point, Fountain Valley, Irvine, Laguna Beach, Newport Beach, Rancho Santa Margarita, San Clemente, San Juan Capistrano, Santa Ana, Stanton, Tustin and Yorba Linda.
In Orange County, about 10% of the county’s nearly 3.2 million residents – roughly 320,000 people – live in poverty, according to the U.S. Census.
The same data shows there are 1,138,966 housing units in the county.
Huntington Beach Faces Off With State
A majority of Huntington Beach planning commissioners Tuesday voted to recommend making a zoning text amendment which would ban Builder’s Remedy – something first proposed by the city council in December.
“The builder’s option is bullying by the state to either pass a housing plan that they’ll approve,” said Commissioner Butch Twinning at Tuesday’s meeting. “Or they’ll put their builder option on us and that’s what I don’t like.”
“I don’t want to see developers just come in here and build wherever they want, whatever they want.”
Their recommendation to the city council comes after state officials issued a couple of warnings calling on them to not move forward with the amendment.
Ahead of the planning commission meeting, the state’s Housing and Community Development department sent another letter to Huntington Beach officials on Monday warning that if they tried to ban builder’s remedy they would be violating state law.
This time the warning came with a letter from State Attorney General Rob Bonta’s office promising to hold Surf City officials accountable if they adopted an ordinance banning builders’ remedy.
Senator Dave Min on Tuesday called out city officials in a news release.
“No city is above state law and the City of Huntington Beach is no exception. Full stop,” he said.
“The Council majority’s current course of action in trying to defy the rule of law and rebel against the authority of the State Legislature, is reckless, counterproductive, and a waste of taxpayer dollars.”
Members of Huntington Beach’s newly elected city council majority ran on a platform that included suing the state over mandated housing goals that requires them to zone for 13,000 new homes in Surf City.
It’s a fight the previous city council refused to take up after settling a lawsuit with the state over not building enough affordable housing in 2020.
Will an Obscure Law Force Development in La Habra & Orange?
In La Habra, questions are being raised if one developer is trying to use the builder’s remedy law to force a development.
The Lennar Corps., a development company based in Miami, filed an application last month proposing to build 530 homes at the Westridge Golf Course – with 110 low income apartments, according to the OC Register.
The number of affordable units meets the 20% threshold needed for builder’s remedy.
The application comes after La Habra city council members in 2020 shot down a previous development proposal for over 440 homes at the golf course called Rancho La Habra after residents pushed back on the project.
That same year voters in the city passed Measure X – which requires any rezoning of open space to be approved by the voters.
In January 2021, Lennar filed a lawsuit against the city over the decision.
Danielle Tocco, Vice President of Communications for Lennar, refused to comment on the new 530-unit development application on Wednesday saying it was a little “premature” to speak on the proposal.
Susan Kim, Director of La Habra’s community and economic department, would not comment Wednesday on Lennar’s application, but said the proposal did not include the words “Builder’s Remedy” in it.
Meanwhile, in Orange, two apparent builder’s remedy applications landed in the lap of the historic and conservation-minded City of Orange in January. The proposals would bypass local zoning restrictions to build a total of nearly 600 homes, as first reported by the Orange County Register.
“Our staff and legal counsel are working with us on how we will deal with this,” Slater, Orange’s mayor, said on Wednesday. “All I can say is, I don’t know why the state thinks they need to step in and do what has traditionally been a city and local responsibility.”
TRC Retail of Newport Beach applied to build 297 townhomes and 75 affordable accessory dwelling units behind the shopping mall on North Tustin Street, the Register reported.
Stonefield Development of Trabuco Canyon, meanwhile, proposes buildings as high as six stories, featuring 204 apartments with 41 of them low-income, along Santiago Creek behind the Chapman Global Medical Center.
The state Housing and Community Development agency, which oversees municipalities’ housing goals, currently lists the City of Orange as out of compliance with its housing element, which would empower housing developers with builder’s remedy.
Though some in town don’t believe their city’s triggered the enforcement tool at all, arguing the city first adopted its housing element a year ago and thus, before developers submitted their applications.
The City Council first passed a housing element update last February.
But upon review of the document, state housing officials identified certain content that “did not entirely meet State Housing Element guidelines and requirements,” reads a city staff report attached to last night’s meeting.
The document “warranted further refinement” on topics like homeless support services, furthering fair housing, and community outreach, among other areas, city staff said.
Last month, however, the state gave the city’s updated plans an informal stamp of approval.
“The housing element will comply with State Housing Element Law […] when it is adopted, submitted to and approved by HCD, in accordance with Government Code section 65585,” reads a Jan. 27 letter from HCD’s senior program manager, Paul McDougall.
Doug Hamilton, a real estate broker in town, told council members they’re not, in fact, out of compliance during public comments at last night’s council meeting.
“The city met the government code by adopting the housing element a year ago, and the city had a letter from (Housing and Community Development) that had been issued and made the determination that the city’s housing element was substantially compliant,” he said.
The City Council re-adopted and formalized the Housing Element last night.
“Procedurally, we’ve done what we’ve been charged to do,” said resident Adrienne Gladson, a retired city planner who also served on the city planning commission when Orange passed its previous housing element update in 2014.
This is what Housing and Community Development spokesperson Alicia Murillo had to say, in a Wednesday written statement:
“HCD has not found the City of Orange’s adopted housing element in substantial compliance with Housing Element Law, and as of today none have submitted drafts that HCD has found in compliance. However, on January 27, 2023, HCD sent Orange a letter finding the draft housing element in compliance. The City would need to adopt, send the adopted element to HCD, and receive confirmation from HCD that the adopted element is in substantial compliance.”
In a Tuesday phone interview, Gladson called builder’s remedy “uncharted territory.”
“It’s clearly untested,” she added. “It’s going to have to answer itself in time.”
Namely through the courts, Gladson predicts.
“We don’t really have a roadmap. We’re probably going to need a judge to give us that insight.”
Brandon Pho is a Voice of OC reporter and corps member with Report for America, a GroundTruth initiative. Contact him at email@example.com or on Twitter @photherecord.
Hosam Elattar is a Voice of OC reporter and corps member with Report for America, a GroundTruth initiative. Contact him at firstname.lastname@example.org or on Twitter @ElattarHosam.
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