Housing group wins lawsuit against City of Beverly Hills over faulty housing planning

LOS ANGELES, Sept. 13, 2023 /PRNewswire/ -- Californians for Homeownership, a nonprofit organization sponsored by the CALIFORNIA ASSOCIATION OF REALTORS^® (C.A.R.) that aims to address California's housing crisis through impact litigation, announced today that it has prevailed in its lawsuit against the City of Beverly Hills to enforce state housing planning laws. 

Following a September 12 hearing, a Los Angeles County Superior Court judge granted the organization's petition for writ of mandate, finding that Beverly Hills had not complied with its legal duty to plan for housing under the regional housing needs allocation (RHNA) and housing element system.

"This is a milestone decision in state housing law," said C.A.R. President Jennifer Branchini. "For far too long, cities and counties have used unrealistic and underdeveloped housing plans to skirt around state planning rules. This case proves that the Legislature's recent improvements to housing element law go a long way toward solving this problem, so long as these new laws are vigorously enforced." 

The RHNA and housing element system is an interconnected process for ensuring that California's cities and counties plan for adequate housing to address statewide and regional housing needs. In the RHNA assessment, state and local governments work together to identify regional housing needs and distribute them among a region's cities and counties. Each city and county must then develop a "housing element" — a component of the city's general plan that identifies sites available for future housing development sufficient to meet the city's RHNA allocation. If the city cannot identify adequate sites, it must change its zoning to allow additional housing development.

Traditionally, certain cities have avoided the bulk of the housing element planning process by obtaining unreasonably low RHNA allocations.  Although Beverly Hills has long been a major jobs center and hub of commerce in Southern California, its 2013-2021 allocation was just 3 units.  But recent changes have made the RHNA allocation process more robust, and the City was assigned a 2021-2029 RHNA of 3,104 units, including 1,688 units of housing for low- and very low-income households. 

So the city shifted its approach, choosing to identify broad swaths of the City's commercial corridors as potential sites for housing, even though most of these sites contain established office, medical, and cultural uses that have little potential for residential development by 2029.  The city also drastically overcounted the realistic development potential on these sites, using a calculation method that assumed that the existing buildings on all of the sites will be razed and replaced with ground-up residential developments, at the maximum density allowed by law.

"These are exactly the sorts of maneuvers that the recent changes to housing element law were designed to address," said Matthew Gelfand, the in-house litigator for the nonprofit. "When cities include inappropriate sites and overcount the potential housing on those sites, it undermines the RHNA system and is deeply unfair to those cities that have put in the work and developed realistic housing plans."

The organization first sued the city over its housing element in January.  The city amended its housing element in February, and the lawsuit was amended to challenge the new version.  Both versions of the city's housing element have been rejected by the state Department of Housing and Community Development (HCD), which is charged with reviewing housing elements for compliance with state law.  In opposing the lawsuit, the city argued that it was entitled to broad discretion in crafting its housing element, despite recent changes to state law designed to limit that discretion.

This week's decision against Beverly Hills is expected to lead to a final judgment that will require the city to revise its housing element on an expedited basis.  Additionally, the ruling should give needed certainty about the applicability of the so-called "builder's remedy" to housing developments in the city.  The "builder's remedy" refers to provisions in state housing law that ease development of projects in cities and counties that have not complied with their housing element obligations. 

"We are aware of a number of builder's remedy projects that have been proposed in Beverly Hills, and our hope is that the decision in our case will help those projects move forward while also encouraging developers to come forward with additional projects in the next few months," Gelfand said.

Housing element compliance has been a major focus for Californians for Homeownership over the last two years. The nonprofit offers to forgo litigation against cities that are willing to acknowledge and comply with the state law penalties for non-compliance. Beverly Hills declined this offer. To date, the organization has filed over 20 housing element lawsuits and has settled 10. The settlements generally commit cities and counties to specific timelines for adoption or revision of their housing elements and require them to comply with the "builder's remedy" while out of compliance.

The case is Californians for Homeownership v. City of Beverly Hills, Los Angeles County Superior Court Case No. 23STCP00143.  A copy of the court's decision will be made available on request.

Californians for Homeownership is a 501(c)(3) nonprofit organization sponsored by the CALIFORNIA ASSOCIATION OF REALTORS^® devoted to using legal tools to address California's housing crisis. For too long, California's cities have treated compliance with state and federal housing law as optional. The organization seeks to change that attitude by proactively enforcing the law, on behalf of the important public interest in having additional housing available to families at all income levels. Californians for Homeownership was established by the CALIFORNIA ASSOCIATION OF REALTORS^® (C.A.R.), and it receives financial support from C.A.R. and private donors. To make a tax-deductible charitable contribution today, visit caforhomes.org.

SOURCE CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.)