A court-appointed receiver could be put in place to decide where and how new housing gets built in Huntington Beach after a panel of appellate judges ruled state regulators have the power to penalize the city for not having an approved housing plan.

As part of the order, the panel of judges pointed to a state law that says “the court may ‘order remedies pursuant to Section 564 of the Code of Civil Procedure,’” a portion of law that maps out how receivership functions. 

“The agent of the court may take all governmental actions necessary to bring the jurisdiction’s housing element into substantial compliance pursuant to [the Housing Element Law] in order to remedy identified deficiencies,” the judges wrote. 

To read the order, click here. 

The court order also noted that the judge “shall impose fines on the city or county, which may increase in severity depending on the duration of the noncompliance.” 

Those fines could range from anywhere to nearly $100,000 to millions of dollars depending on a judge’s decision. 

Huntington Beach Mayor Pat Burns declined to comment on Friday morning, saying he had not yet read the ruling and needed to consult with City Attorney Mike Vigliotta. 

It marks another chapter in Surf City’s years-long battle against the Golden State’s housing mandates. 

The city hasn’t had a state-mandated housing plan in nearly four years while fighting it in both federal and state court, arguing they don’t need one because of their status as a charter city. 

[Read: Will Huntington Beach’s Legal Argument of Limited Independence Hold up in Court?] 

But that argument hasn’t worked out well in court.

San Diego Superior Court Judge Katherine Bacal ordered the city to create a housing plan in May 2024, but opted not to set a 120-day deadline requested by state prosecutors, which also blocked state regulators from penalizing the city for their lack of a plan. 

[Read: Huntington Beach Loses Housing Mandate Lawsuit Against California]

The California Fourth Appellate District Court of Appeals shot down that chunk of Bacal’s ruling on Thursday, ordering her to rewrite her ruling to include both the deadline and the ability for state regulators to issue penalties. 

“The trial court erred when it omitted the 120-day compliance deadline and one or more mandatory provisional remedies,” the judges wrote. 

The judges also ordered Bacal to hear the case “expeditiously.” 

“The court’s swift resolution of those pleadings should enable the court to enter a final judgement without delay,” the judges wrote. 

California Governor Gavin Newsom and Attorney General Rob Bonta celebrated the ruling in a joint statement on Friday morning, with Newsom criticizing city officials for “wasting time and money.” 

“No more excuses — every city must follow state law and do its part to build more housing,” Newsom wrote. 

Bonta also wrote that penalties would be coming soon. 

“Huntington Beach is running out of excuses, and the consequences for failing to plan for its fair share of housing are becoming clearer and more serious.”

Noah Biesiada is a Voice of OC reporter. Contact him at nbiesiada@voiceofoc.org.