The California Court of Appeal, Fifth Appellate District affirmed the trial court’s ruling that City of Clovis (the “City”) did not substantially comply with the Housing Element Law (“Housing Element Law”). In order to come into compliance with the Housing Element statute, the City implemented two changes to its Municipal Code designed to accommodate greater affordable housing development. To do so, the City amended the General Plan to allow for multi-family housing in the Public Facilities Zone (“P-F Zone”) and adopted a corresponding zoning ordinance to (a) provide for multi-family housing as a permitted use in P-F Zone and (b) add a new overlay zone district for Regional Housing Needs Allocation (“RHNA”), known as the RHN Overlay, which provided by-right approval for lower income housing in all vacant, residentially zoned property between one and 10 acres within the City limits. Since the City had a shortfall for the current planning period—the carryover from the prior planning period—the Housing Element Law imposes a minimum density requirement to rezone sites to accommodate the shortfall of affordable housing units. However, since the City’s overlay designation did not change the base zoning, it allowed for development to continue to occur at a density lower than the statutory minimum. Therefore, the court held the RHN Overlay sites do not comply with Housing Element Law, because it does not guarantee compliance with the mandatory statutory minimum. In a nutshell, putting an overlay zone on the properties does not require that any of the sites be developed at the higher densities required for affordable housing units.
City History of Housing Element Compliance
The two RHNAs that are relevant to this case are the RHNA adopted by the Fresno Council of Governments (“COG”) for the 2006 through 2013 years (the fourth revision cycle for the City’s Housing Element) and the RHNA for the January 1, 2013, to December 31, 2023, period (the fifth revision cycle). The fifth cycle was adopted by COG on July 31, 2014, and set forth the RHNA for Clovis and all other jurisdictions in Fresno County. Sometime in 2016, Clovis adopted the “Fresno Multijurisdictional 2015-2023 Housing Element” (2015-2023 Housing Element). It stated that Clovis’s fifth cycle RHNA totaled 6,328 housing units, which consisted of 1,160 extremely low-income units, 1,161 very low-income units, 1,145 low-income units, 1,018 moderate income units, and 1,844 above moderate-income units. The fifth cycle also addressed Clovis’s fourth cycle RHNA and the number of unaccommodated housing units that carried over to the fifth planning period. The City’s fourth cycle RHNA had a total of 15,383, including 1,637 extremely low-income units, 1,638 very low-income units, and 2,354 low-income units (i.e. a total of 5,625 lower income units. Clovis met its fourth cycle RHNA for moderate and above moderate-income units. In contrast, Clovis failed to accommodate 4,425 units of its lower income housing RHNA of 5,629 units.
The shortfall during the fourth cycle was caused by the City rezoning a substantial amount of land at densities that could accommodate 4,614 lower income units, but only 717 units on sites zoned R-4 met the statutory requirements for adequate sites. For sites to satisfy the lower-income RHNA during the carryover period, they must meet the following statutory requirements:
- Must be rezoned within the first year of the next cycle following shortfall; and
- Must be rezoned to permit owner-occupied and rental multi-family housing by right without discretionary review of the use or density; and
- Must be zoned with a minimum density of 20 units per acre and be large enough to accommodate at 16 units per site (Government Code § 65583.2(h)); and
- Additionally, at least 50 percent of the low income RHNA carryover must be allowed on sites designated for exclusively residential uses.
After going back and forth with the California Department of Housing and Community Development (“HCD”), in 2019, HCD finally deemed the City in compliance with the Housing Element Law.
Plaintiff Martinez sought a writ of mandate for violation of the Housing Element Law challenging (1) the adequacy of the City’s amended housing element; (2) the City’s failure to comply with the requirement to rezone to accommodate the RHNA carryover within the first year of the fifth planning period; and (3) the City’s failure to implement Program 4, the action plan the City promised HCD would cure the shortfall in lower income housing. The trial court granted the writ of mandate for the three causes of action and directed the City to file a return within 150 days stating how it had complied with the writ. The City appealed. The appellate court affirmed the trial court order as to the 1st and 3rd causes of action and reversed as the 2nd cause of action because it held, unlike the trial court, that the City was not required to provide an analysis of the feasibility of development in the rezoned areas.
Program 4 and the RHN Overlay
Program 4 in the 2015-2023 housing element stated Clovis would rezone to accommodate its fourth cycle RHNA shortfall of 4,425 lower income units by December 31, 2016. However, the City never demonstrated implementation of the program and instead offered only an anticipated schedule for program implementation. Clovis ultimately failed to meet its deadline in December 2016 and HCD subsequently revoked its finding that the City’s Housing Element substantially complied with state law. In November 2018, Clovis again attempted to bring the Housing Element into compliance by adopting the RHN Overlay to provide by-right approval for multi-family housing at a density of 35 to 43 units per acre on any residentially zoned sites with a minimum of 1 acre and a maximum of 10 acres. However, the base zoning in existence when the overlay was enacted still applied to the RHN Overlay sites. That base zoning permitted development at densities below 20 units per acre on all except one of the sites, and some densities were as low as 0.5 units per acres, far below the statutory minimum for carryover Housing Element zoning.
The Court of Appeal determined the statutory standard Clovis failed to meet was a mandatory minimum. This means that the City is required to not only adopt zoning regulations that accommodate high-density multi-family housing, but also enforce the exclusivity of those zones for that purpose. The City’s responsibility is not simply to refrain from housing discrimination, but rather, it is obligated to “affirmatively further fair housing.” The Court concluded that the City could not satisfy its Housing Element duties by borrowing from existing zoned sites and merely expanding their usage; rather, it was required to rezone those sites entirely. Consistent with this determination, the Court of Appeals also held that HCD was “clearly erroneous” when it approved the RHN Overlay as compliant with the Housing Element Law in 2019.
However, the court also pushed back against the plaintiff’s contentions that when designating Housing Element zones for nonvacant sites, the City is required to conduct an analysis of the feasibility of development on those sites, including publishing its methodology and including its findings in the Housing Element itself. The court agreed with the Clovis that, although “the goal [of the Housing Element Law] is not just to identify land, but to pinpoint sites that are adequate and realistically available for residential development targets for each income level,” the City was not required to carry out an analysis that is not required by the Legislature by statute.
The key takeaway from this case is that to comply with the Housing Element Law and the affirmative duty to further fair housing, many local governments will need to designate exclusive income-based housing sites rather than layering them upon existing zones. However, the State’s emphasis with local governments remains centered on local land use control. Local governments are still not required to build, finance, or otherwise contribute public funds to construct lower income housing.
 Further references to the “Housing Element” are to sections 65580 through 56689.11, which constitute article 10.6 of Chapter 3 of Division 1 of Title 7 of the Government Code.
Kara Anderson is a law clerk at Abbott & Kindermann, Inc. For questions relating to this article or any other California land use, real estate, environmental and/or planning issues contact Abbott & Kindermann, Inc. at (916) 456-9595.
The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, Inc., or the formation of a lawyer/client relationship. Because of the changing nature of this area of the law and the importance of individual facts, readers are encouraged to seek independent counsel for advice regarding their individual legal issues.