MOORLACH UPDATE — RHNA Retribution — January 26, 2019

California’s new Governor lobbed a hand grenade yesterday morning into the city of Huntington Beach. He called upon the State’s Attorney General to sue Surf City because it was allegedly deficient in its regional housing needs allocation (RHNA, and pronounced ree-nah). The AG complied. Cities and counties are mandated by the state to meet their respective populations’ housing element (see http://www.hcd.ca.gov/community-development/housing-element/index.shtml).

With all the new construction in Huntington Beach, including the recent Pacific City and high density Bella Terra projects (which include low income housing units), Gavin Newsom’s move has me befuddled. The justification for pursuing legal action against a subsidiary without first informing it about the potential threat of litigation is not obvious or clear.

On September 15, 2017, I voted against AB 72 (Santiago), which passed in the Senate 28-8-4 and was the impetus for the Governor’s surprise tactic (see http://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180AB72). Here is a portion of the Legislative Counsel’s Digest for the bill, with underlines for emphasis:

This bill would require the [Department of Housing and Community Development] to also review any action or failure to act by the city, county, or city and county that it determines is inconsistent with an adopted housing element or a specified provision and to issue written findings, as specified, whether the action or failure to act substantially complies with the housing element. If the department finds that the action or failure to act by the city, county, or city and county does not substantially comply with the housing element, and if it has issued findings as described above that an amendment to the housing element substantially complies with the housing element, the bill would authorize the department, after allowing no more than 30 days for a local agency response, to revoke its findings until it determines that the city, county, or city and county has come into compliance with the housing element. The bill would also require the department to notify the city, county, or city and county and authorize the department to notify the Office of the Attorney General that the city, county, or city and county is in violation of state law if the department makes certain findings of noncompliance or a violation.

The OC Register and Santa Cruz Sentinel covers the disappointing action in the first piece below. After a couple of interviews, I released a statement, which the remaining publications utilized. The Daily Pilot, the city’s now de facto local paper, is the second piece. The Associated Press, which has a large national distribution, is the third piece. And City News Service, which has a strong coverage of Orange County, is the fourth piece.

Last November, this city found its Republican Congressman was switched out with a Democrat. One of its two State Senators and one of its two State Assemblymembers were also switched out in the same manner. But, somehow, this couldn’t shield Huntington Beach from potentially expensive and, in my view, unnecessary litigation that a Democratic Governor just threw in its lap.

I fully understand going after supposed bad players. But, good form would have been to issue a strong and very public warning, with a due date in which to respond, and then, if necessary, the filing of a lawsuit. Cities, especially Huntington Beach, are already strapped fiscally with rising pension plan contribution costs, thus making it more financially stressful to deal with unanticipated litigation costs.

Governor Brown had a tense relationship with cities during his tenure. It looks like Governor Newsom is willing to follow suit and even escalate. That’s very unfortunate, as all layers of state government should be collaborating in a professional and mutually beneficial manner.

 

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Gov. Gavin Newsom targets Huntington Beach with lawsuit over affordable housing

“Some cities are refusing to do their part” to solve California’s housing crisis, the new governor says

By jhorseman and sgoulding | The Press-Enterprise

https://www.santacruzsentinel.com/2019/01/25/gov-gavin-newsom-says-state-to-sue-huntington-beach-over-affordable-housing-2/

https://www.ocregister.com/2019/01/25/gov-gavin-newsom-says-state-to-sue-huntington-beach-over-affordable-housing/

The state is accusing the city of Huntington Beach of deliberately blocking affordable housing in a lawsuit that signals new Gov. Gavin Newsom’s willingness to take on local governments seen as obstacles to a more affordable California.

“California’s housing crisis is an existential threat to our state’s future and demands an urgent and comprehensive response,” Newsom said in announcing the lawsuit Friday, Jan. 25.

“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.”

The governor said the state “doesn’t take this action lightly. The huge housing costs and sky-high rents are eroding quality of life for families across this state. California’s housing crisis is an existential threat to our state’s future and demands an urgent and comprehensive response.”

The lawsuit filed in Orange County Superior Court by Attorney General Xavier Becerra alleges the Huntington Beach City Council, after developing a housing plan in 2013 that met state standards for affordable housing, amended that plan to drastically cut the number of housing units being built.

A state agency ruled Huntington Beach out of compliance in 2015. State law requires cities and counties to adopt housing plans that allow housing for a range of income levels.

https://www.scribd.com/document/398232662/California-Department-of-Housing-and-Community-Development-vs-City-of-Huntington-Beach

The lawsuit seeks to force Huntington Beach to include more housing that a wide range of residents can afford in its housing plan. It’s the first to be filed under a 2018 law that allows the state to revoke a city’s or county’s housing plan and refer noncompliance cases to the attorney general for litigation.

Huntington Beach City Attorney Michael Gates said the city “will review all of its options in order to respond to the lawsuit.”

Gates cited “recent court victories in lawsuits challenging the city’s actions to zone for additional housing, including affordable housing” as evidence that it is in compliance with state laws.

In 2016, Huntington Beach council members voted to scuttle a plan to meet state housing requirements after more than 200 people filled City Hall to oppose adding high-density and low-income housing.

“I urge you to deny any and all action that would amend the housing element or anything that would add one monstrosity development,” resident Cari Swan said at the time.

Huntington Beach has some of the highest housing costs in the region and the state. Census figures show the median gross rent in the city was $1,823 a month in 2017, compared with $1,447 in California as a whole and a nationwide median of $1,012.

Huntington Beach’s median home price average more than $850,000 as of November according to CoreLogic, compared with $522,750 for Southern California as a whole.

With many Californians struggling to find affordable homes, Newsom, who took office this month, allocated $500 million in his first budget in incentives for cities that allow new housing and $250 million for technical help for cities to change zoning and speed up permitting so new homes can be built.

The proposed budget also contains $1 billion for housing construction.

With the carrots comes a stick. Newsom has threatened to withhold transportation money for cities that don’t meet affordable housing targets.

Newsom “has been very clear from the beginning he is done playing small ball on housing,” said David Garcia, policy director at the UC Berkeley Terner Center for Housing Innovation.

The Huntington Beach lawsuit, Garcia added, “(is) going to give cities pause when they are feeling pressured by their residents to reduce their share of planned housing.”

Ninety percent of California cities are in compliance with their housing plans, according to Russ Heimerich, a spokesman for the state Business, Consumer Services and Housing Agency. Fifty-one cities are out of compliance and of those, 14 have revisions that are under review, he said.

California’s latest litigation against Huntington Beach adds to a list of thorny lawsuits the city is battling against the state and other entities.

In 2015, the Kennedy Commission, a nonprofit housing advocacy group based in Irvine, sued Huntington Beach over its decision to limit development of low-income housing. A Superior Court judge sided with the commission.

Huntington Beach appealed, arguing that as a charter city it has greater autonomy in making and enforcing ordinances and resolutions. In 2017, an appellate court agreed with the city. However, the court also allowed the Kennedy Commission to continue pursuing unresolved claims that the city’s housing plan violates the state constitution and is discriminatory.

Since 2014, Huntington Beach has issued permits for about 100 units for lower-income residents. But in order to comply with state law, it must add a total of 533 units, said Cesar Covarrubias, executive director of the Kennedy Commission.

“That’s not a huge number,” Covarrubias said. “But rather than do the right thing, the city’s position has been, ‘We’ll just litigate.’” As a visitors’ destination, Huntington Beach has many employees working in the tourism industry who cannot afford to live there, he added.

Covarrubias said the Kennedy Commission will continue its litigation against Huntington Beach concurrent with the state’s.

The city also is fighting California’s “sanctuary law.” In April 2018, Gates filed a lawsuit against the state claiming that Senate Bill 54 unconstitutionally interferes with the city’s charter authority to enforce local laws and regulations.

An Orange County Superior Court judge ruled in favor of Huntington Beach in September, allowing the city to ignore the state’s immigration legislation that limits interaction between local law enforcement and federal immigration officials. The state has filed an appeal of that ruling.

Gates questioned the state’s “motivation for this lawsuit filed only against Huntington Beach” in the latest round of litigation tied to the city’s claim of autonomy. Other cities, too, “have not yet met their Regional Housing Needs Assessment targets,” he said.

“Any delay experienced by the city in its ability to amend its zoning and make additional progress,” Gates said, “has been caused by the city fighting lawsuits and court appeals filed by plaintiffs such as the Kennedy Commission.”

Democratic lawmakers welcomed the lawsuit.

“For too long, cities that refuse to plan for adequate new housing have flouted their legal and ethical obligations, directly contributing to the housing affordability and homelessness crisis that we now have statewide,” Senate President Pro Tem Toni Atkins, D-San Diego, said in a statement.

Assemblyman Tyler Diep, R-Westminster, who represents part of Huntington Beach, asked the governor and attorney general to reconsider filing the lawsuit, saying the shortage of affordable housing is not exclusive to Huntington Beach.

“Litigation is not the solution, especially when it was because of lawsuits filed under the guise of (the California Environmental Quality Act) that held up numerous housing developments,” he said.

State Sen. John Moorlach, R-Costa Mesa, one of two state senators representing Huntington Beach, said the lawsuit “starts a whole new debate” about local control versus centralized control.

“I’m not sure this is the best way for the governor to start that debate,” he said. “These are tough local issues. So now for the state to say, ‘You’re going to do this whether your citizens like it or not,’ then it begs the question: ‘Why Huntington Beach? Why not a city in Marin County?’”

Asked why Huntington Beach was sued, a spokesman for the governor said: “Probably because it’s one of the most egregious examples in the state.”

Staff Writer Jeff Collins contributed to this report.

State sues Huntington Beach over blocked homebuilding

By PRISCELLA VEGA and LIAM DILLON

HTTPS://WWW.LATIMES.COM/SOCAL/DAILY-PILOT/NEWS/TN-DPT-ME-HB-HOUSING-LAWSUIT-20190125-STORY.HTML

At Gov. Gavin Newsom’s request, California filed a lawsuit Friday against the city of Huntington Beach over what state officials describe as the city’s failure to allow enough homebuilding to accommodate a growing population.

Newsom said the suit is needed to address rising housing costs that threaten economic growth and deepen inequality. The lawsuit accuses Huntington Beach of defying a state law that requires cities and counties to set aside sufficient land for housing development.

The California Department of Housing and Community Development issued letters to the city in 2015 and 2018 requesting that it comply.

“Many cities are taking herculean efforts to meet this crisis head on,” Newsom said in a statement. “But some cities are refusing to do their part to address this crisis and willfully stand in violation of California law. Thosecities will be held to account.”

The state is asking that an Orange County Superior Court judge order Huntington to comply with the law. It also seeks attorney fees and other costs.

But Huntington Beach City Attorney Michael Gates contended “the city has been, in fact, complying with all applicable state housing and zoning laws.”

Huntington “has been and will continue to work with the California Department of Housing and Community Development regarding meeting the city’s Regional Housing Needs Assessment,” Gates said in a statement Friday. “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.”

He pointed to recent court victories in an ongoing lawsuit in which the Kennedy Commission, an affordable-housing advocacy group, alleged that an amendment to the city’s development plan for the Beach Boulevard-Edinger Avenue corridor violated state housing law.

Gates called the state’s lawsuit “timed poorly” because it interrupts months of discussions between the Department of Housing and Community Development and the Kennedy Commission toward reaching a resolution of outstanding disputes.

He said it also raises questions about the state’s motive, as “50 other cities in California have not yet met their RHNA targets.”

Gates said the city is reviewing its options on how to respond to the lawsuit.

The case against Huntington Beach is a rare legal action by the state against a local government over housing laws. In 2009, when former Gov. Jerry Brown was attorney general, the state intervened in a lawsuit against the Bay Area city of Pleasanton, where voters capped the amount of housing allowed. The case ended with Pleasanton getting rid of its cap, zoning for more homes and owing about $4 million in attorney fees.

Though cities and counties do not build homes, local restrictions on development, such as high fees or a lack of land zoned for residential use, can prevent construction that might otherwise occur. Higher-income coastal communities, including Huntington Beach, often maintain some of the tightest development rules in the state, even as housing costs have soared in the past decade.

The median home value in the beach city of 200,000 people tops $834,000, according to real estate website Zillow. More than half of Huntington Beach’s tenants are rent-burdened, meaning they spend more than 30% of their income on housing, according to U.S. Census data.

Huntington Beach put itself in a shortfall toward its state-mandated target for low-income housing units when the council in 2015 amended the Beach and Edinger Corridors Specific Plan, which was adopted in 2010 to help revitalize Beach Boulevard and Edinger Avenue by streamlining the building approval process.

The amendments reduced the cap on new residential development from 4,500 units to 2,100 and imposed stricter height and setback requirements after many residents complained about the high rate at which high-density residential projects were popping up.

The original Beach and Edinger plan is tied to Huntington Beach’s housing element, a guideline in the city general plan that it uses to identify ways the city can address housing needs for all economic segments as the community grows.

The amendments meant the city no longer had enough land zoned to accommodate low-income residents under state requirements, prompting a lawsuit two months later from the Kennedy Commission.

According to the state’s lawsuit, the Department of Housing and Community Development began working with the city to prepare an amended and “legally compliant” housing element shortly after it issued its first letter in 2015.

But the Kennedy Commission sued Huntington in the midst of the state and city partnership.

“We’re concerned about the opportunities for affordable housing, being that Orange County is among the least affordable counties in the nation and in California,” Cesar Covarrubias, the nonprofit’s executive director, said in 2015. “We believe that every city should have appropriate sites to create opportunities for housing all its residents, especially low-income residents.”

The city argued in court that it was working to amend its housing element and that the Kennedy Commission’s lawsuit was “unnecessary and would soon be moot.” But a proposed plan was unanimously rejected by the City Council in 2016.

Councilman Erik Peterson said at the time that the city should prepare to fight the state regarding the mandated amount of low-income housing in the city.

The legal battle with the Kennedy Commission is continuing, though a state appeals court ruled in favor of the city in 2017 because Huntington is a charter city, exempting it from some state zoning laws.

After Housing and Community Development issued a second notice of noncompliance in 2018, the city said it would create a new housing plan after it resolved its dispute with the Kennedy Commission.

“The time for empty promises has come to an end,” the state’s lawsuit says. “The city should not be allowed to avoid its statutory obligations any longer.”

Huntington Beach has issued permits and filed inspections for more than 2,500 new housing units, including about 100 very-low-income and low-income deed-restricted units, since 2014, according to Gates. The city also established a Tenant Based Rental Assistance Program designed for extremely low-income and homeless people, he said.

State Assemblyman Tyler Diep (R-Westminster) expressed support for Huntington Beach, part of the area he represents, and said litigation isn’t the solution to the housing shortage.

“There are reports on cities in California stating they will not meet their 2040 housing goals until the year 2295 or after,” Diep said in a statement Friday. “Huntington Beach has had a 4% population increase since 2004; meanwhile, some of the fastest-growing cities in California are required to build less housing than this city.”

State Sen. John Moorlach (R-Costa Mesa) said in a statement that he was “befuddled” that Newsom — a former mayor of San Francisco, a city with high housing costs — singled out Huntington Beach with litigation instead of engaging in “goodwill gestures” to help cities reach their housing goals.

“Once this approach is started, then it must be applied to all other cities not in compliance,” Moorlach said. “He should have a policy of no better, no worse. Otherwise, these are strong-arm tactics.”

Priscella Vega is a Daily Pilot staff writer. Liam Dillon writes for the Los Angeles Times.

California sues wealthy coastal city over low-income housing

By:

https://www.nwahomepage.com/news/politics/california-sues-wealthy-coastal-city-over-lowincome-housing/1726953003

Gov. Gavin Newsom used a new law for the first time Friday to try to force a wealthy Southern California coastal city to end its years of opposition to meeting low-income housing goals.

Newsom’s administration sued the Orange County city of Huntington Beach under the law that took effect Jan. 1 after passing in a 2017 package of measures intended to alleviate the state’s severe housing shortage and homelessness problem.

California has more homeless people than any other state and the nation’s highest poverty rate when soaring housing and rental costs are taken into account. Newsom, who took office this month, has proposed building 3.5 million housing units in the state with nearly 40 million residents.

The lawsuit says leaders in Huntington Beach, home to about 200,000 people, have repeatedly refused to amend the city’s housing plan to add state-required low-income housing and are fighting a separate lawsuit by housing advocates. The city says it’s complying with state housing and zoning laws.

It’s the second major issue facing California that the self-styled “Surf City USA” is battling the state over. Huntington Beach also is challenging the sanctuary law that limits cooperation with federal immigration officials.

The city is in a traditionally Republican area that has been shifting more Democratic like the rest of California. State officials say housing negotiations began before Huntington Beach challenged the immigration law and the lawsuit isn’t retaliatory.

“Many cities are taking herculean efforts to meet this crisis head on,” the Democratic governor said in a statement. “But some cities are refusing to do their part.”

City Attorney Michael Gates said it’s following the law, pointing to a victory in a related lawsuit. An appeals court ruled in 2017 that cities like Huntington Beach that have their own charters can approve plans that don’t meet the state’s housing requirements and can eliminate sites zoned for affordable housing.

Former Gov. Jerry Brown signed a law last year closing what housing advocates described as a legal loophole for charter cities. Huntington Beach’s charter led an Orange County judge to rule that it isn’t bound by the state’s sanctuary law because it has greater autonomy to enforce local laws. The state has appealed that ruling.

Gates said the city has approved more than 2,500 new housing units since 2014, including about 100 low-income units, leaving the city about 400 units short of state goals for low-income housing.

Republican state Sen. John Moorlach, who represents Huntington Beach, criticized Newsom’s “heavy-handed litigation tactics that will divert the city’s time, energy and resources to respond to obstructive and otherwise frivolous lawsuits.”

Democratic lawmakers, including Senate President Pro Tem Toni Atkins of San Diego, praised Newsom for opening what she called “a new chapter for housing in California” against cities that “have flouted their legal and ethical obligations.”

Huntington Beach was deemed out of compliance in 2015, and state officials most recently notified the city in November that it was still breaking state law. California sued in Orange County Superior Court under the new law strengthening its ability to require local governments to meet housing goals.

The California Department of Housing and Community Development sets the number of new housing units that a region is projected to need to provide homes for all income levels.

The department says 90 percent of housing plans statewide are in compliance, while Huntington Beach is one of 51 cities and counties that are not.

Newsom said high housing costs and rents “are eroding quality of life for families across this state.” He said the problem is “an existential threat to our state’s future and demands an urgent and comprehensive response.”

He has promised several moves to increase affordable housing, including giving cities more money for housing shelters but taking away transportation money if they fail to meet their goals. The Democratic governor’s budget proposal seeks $1.75 billion to combat homelessness by encouraging new affordable housing.

State Sues Huntington Beach, Accusing it of Blocking Housing Production

The city has refused to comply with state housing law, according to Gov. Newsom’s office.

By City News Service

https://www.nbclosangeles.com/news/local/-State-Sues-Huntington-Beach-Accusing-it-of-Blocking-Housing-Production-504878141.html

Gov. Gavin Newsom announced a lawsuit on Friday against the city of Huntington Beach, accusing the Orange County surfing haven of blocking the production of affordable housing and thus exacerbating the statewide housing crisis.

“The state doesn’t take this action lightly,” Newsom said in a statement. “The huge housing costs and sky-high rents are eroding quality of life for families across this state. California’s housing crisis is an existential threat to our state’s future and demands and urgent and comprehensive response.”

Huntington Beach City Attorney Michael E. Gates said the governor’s statement “contains inaccuracies” and said the move would slow down efforts to negotiate a legal settlement regarding housing issues.

According to Newsom’s office, the city has refused to comply with state housing law, “even after extensive attempts to offer partnership and support from the California Department of Housing and Community Development.”

The state argued that cities are required to enact housing plans that meet “the needs of the broader region and its economy.”

The state Department of Housing and Community Development found Huntington Beach’s housing plan to be deficient in 2015. According to Newsom’s office, the city was in compliance two years earlier, but it then amended its housing plan “and significantly reduced the number of new housing units able to be built.”

The city later rejected a proposed amendment that would have added the ability for more units to be built, according to the governor’s office.

“Cities and counties are important partners in addressing this housing crisis, and many cities are making herculean efforts to meet this crisis head-on,” Newsom said. “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.”

Gates responded that the city has been “complying with all applicable state housing and zoning laws and has been, and will continue to, work with the California Department of Housing and Community Development regarding meeting the city’s Regional Housing Needs Assessment.”

Gates said proof of that “is evidenced by the city’s recent court victories in lawsuits challenging the city’s actions to zone for additional housing, including affordable housing.”

Efforts by city officials to improve its zoning “has been caused by the city fighting lawsuits and court appeals filed by plaintiffs such as the Kennedy Commission.”

Gates said the lawsuit was “timed poorly as it now interrupts recent months of discussions with both (Housing and Community Development) and the Kennedy Commission with regard to a resolution to the remaining outstanding disputes.”

Since 2014, the city has “issued permits and filed inspections for over 2,500 new housing units, including approximately 100 very low-income and low-income deed-restricted units,” Gates said.

“Moreover, the city has also permitted or entitled all of its moderate-income (Regional Housing Needs Assessment) target,” Gates said. “The city has also established programs, such as our Tenant Based Rental Assistance program, dedicated to providing assistance to extremely low income and at-risk homeless households.”

Gates said it was “noteworthy” that Huntington Beach has been singled out “while over 50 other cities in California have not yet met their RHNA targets. That raises questions about the motivation for this lawsuit filed only against Huntington Beach.”

The city also is embroiled in a legal battle with the state over the so-called “sanctuary state” law that the city has claimed doesn’t apply to Huntington Beach since it is a charter city.

State Sen. John Moorlach, R-Costa Mesa, criticized the lawsuit in a statement.

Moorlach said he was “befuddled that Gov. Newsom – a former mayor of a city and county with astronomical housing costs and multitudinous problems – would try and make an example out of my constituents, the city of Huntington Beach, and sue them for not having enough affordable housing.”

Moorlach said he believes the city “is doing its best to comply with applicable state housing and zoning laws and continues to work on meeting its housing goals and has consistently prevailed in court on this very issue.”

The state senator said the governor has “made things worse” and “exacerbated the housing crisis by unilaterally” suing.

Moorlach said Huntington Beach should not be singled out when other cities lag behind affordable housing requirements.

“Otherwise, these are strong-arm tactics,” Moorlach said.

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