California Sues ‘Surf City USA’ for Stonewalling on Affordable Housing

(CN) – California began taking steps Friday to crack down on cities that refuse to comply with the Golden State’s housing laws, slamming the city of Huntington Beach over its strict development rules that stand in the way of affordable housing development amid a housing crisis.

Gov. Gavin Newsom’s office said state Attorney General Xavier Becerra filed a lawsuit against Huntington Beach in Orange County Superior Court on Friday, the first lawsuit of its kind as the state looks to address the housing crisis by holding local government officials accountable for refusing to share the burden.

While Newsom’s office noted Huntington Beach was on track to meet state standards, it reversed course in 2013 and by 2015 had violated state law by refusing to build a sufficient number of affordable housing units. The City Council rejected notice from the state Department of Housing and Community Development and voted down a measure to create both low-income and high-density housing developments – bowing to pressure from residents over the demands of the state.

By 2016, the city had fallen about 400 affordable housing units short of state mandates.

In 2017, California’s housing crisis prompted the passage of Assembly Bill 72. The bill took effect a year ago, and allows the state to rescind a local government’s housing rules if they violate affordable housing requirements.

Huntington Beach is one of those violators, according to the state.

In a statement, Newsom said, “Cities and counties are important partners in addressing this housing crisis, and many cities are making herculean efforts to meet this crisis head on. But some cities are refusing to do their part to address this crisis and willfully stand in violation of California law. Those cities will be held to account.”

Known as “Surf City USA” since winning a trademark battle with Santa Cruz over the moniker in 2008, the affluent Huntington Beach sued the state Jan. 17 and called the portion of the housing package that allows the state to strip violating cities of their right to govern zoning affairs unconstitutional.

The city asked an Orange County Superior Court judge to find Senate Bill 35 is pre-empted by the California Constitution.

Huntington Beach City Attorney Michael Gates said he has not seen the complaint but called claims in Newsom’s statement inaccurate as the city has complied with state housing and zoning laws.

The city will review all its legal options so they can respond to the lawsuit, and Gates said it’s suspect that they were singled out while other cities have not met housing targets set by the state. 

“The fact that the city has been complying with applicable laws is evidenced by the city’s recent court victories in lawsuits challenging the city’s actions to zone for additional housing, including affordable housing,” said Gates. “Any delay experienced by the city in its ability to amend its zoning and/or make additional progress has been caused by the city fighting lawsuits and court appeals filed by plaintiffs such as the Kennedy Commission.”

The nonprofit Kennedy Commission sued Huntington Beach in 2015 over the reduction of housing units. The group said Huntington Beach was out of line with the state’s housing laws and a Los Angeles Superior Court judge ruled in their favor in 2015. A Fourth Appellate District panel reversed, however, and this month the California Supreme Court declined to review the case.

In his first proposed budget since taking office this month, Newsom has allocated $500 million in incentives for local governments to meet housing needs and production and another $1 billion could go toward construction costs.

 Newsom’s budget will be revised after the April tax deadline. The revision must be approved by the Legislature by the end of June.

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