A state appellate court has upheld the City of Gilroy's housing element against a challenge filed by affordable housing advocates. The court ruled that, under the housing element law in effect when Gilroy updated its housing plan in 2002, the city did not have to provide a site-specific inventory and analysis.

The decision by a unanimous three-judge panel of the Sixth District Court of Appeal appears to conflict with a 1997 decision regarding the City of San Diego's housing element. In Hoffmaster v. City of San Diego, 55 Cal.App.4th 1111, the court rejected a housing element because it lacked information about specific sites and policies for homeless shelters and transitional housing (see CP&DR Legal Digest, August 1997). The court ruled in Hoffmaster that a broad inventory of land available for housing development was inadequate.

In the Gilroy case, housing advocates argued that the city did not identify residentially zoned land by parcel, failed to analyze those sites, did not identify enough sites to meet the city's fair share of affordable units, and did not provide adequate sites for "by right" multi-family residential development. The Sixth District suggested that the advocates might have a good argument under today's statute, but not under the law prior to 2004 amendments.

"The Legislature made amendments to the housing element law in 2004 after Gilroy's adoption of its 2002 general plan to read, in essence, as plaintiffs contend we should read the prior law," Justice Wendy Clark Duffy wrote for the court. "In other words, plaintiff's arguments largely point not to legal insufficiencies in Gilroy's 2002 housing element but instead to inadequacies and inefficiencies in the prior statutory language."

Like other cities in the greater Bay Area, Gilroy had a December 31, 2001, deadline to update its housing element. Under the Association of Bay Area Government's regional housing needs allocation, Gilroy had to plan for 1,240 units of housing affordable to low- and very low-income households.

The city submitted its draft housing element and a background report in December 2001 to the Department of Housing and Community Development (HCD), which found the draft plan to be out of compliance with state law. Gilroy and HCD went back and forth, with the city ultimately adopting a housing element that the state found inadequate because the plan did not include a site-specific land inventory, and did not provide analysis and removal of governmental constraints to affordable housing development.

Housing advocates filed suit in May 2004, arguing that the city violated the housing element law (Government Code §§ 65580-65589.8) and the "least cost zoning law" (§ 65913 et seq.), which requires cities and counties to zone adequate land for housing development. Santa Clara County Superior Court Judge William Elfving ruled that the housing element complied with the law.

On appeal, the Sixth District first dealt with the standard of review. Housing advocates pointed to HCD's conclusions for support, but the court ruled that HCD's "informal interpretation of statutory requirements is in no way binding on us."

On the merits, the city argued that the law in 2002 required no more than an aggregate listing of vacant sites and locations having potential for redevelopment, along with a general analysis of zoning and public facilities to serve new units. The court agreed, rejecting housing advocates' argument that 2004 statutory amendments in AB 2348 (Mullin) simply clarified requirements for site specificity.

"[P]rior to the 2004 amendments to the housing element law, substantial compliance with § 65583, subdivision (a)(3), required only general analysis of zoning and public facilities to the inventoried sites, as catalogued or listed in the aggregate," the court ruled.

The court also rejected housing advocates arguments, based on Hoffmaster, that the city could count only sites immediately available for development — an argument that implies specific sites must be identified and obstacles to development removed.

The court said the housing advocates were overreaching. "The statutory language did not require that sites be immediately available for development in order for them to be ‘adequate.' Nor did it require a showing of the feasibility of development on individual sites. Nor did it require that actions designed to ameliorate developmental or zoning constraints be scheduled to occur at any particular point early in the planning period so that actual development could be completed within that period. Instead, the statute simply required a statement of administrative plans scheduled to occur over a five-year period," the court ruled.

"While the city could have offered more specificity, and while the element does not express that its programs and action items will yield the desired results soon enough in the planning period to permit full development within that period, these were not required for substantial compliance with the statute," Justice Duffy continued.

Similarly, the court ruled, the least cost zoning law "does not require immediate action and permits a locality to act within the planning period to meet regional housing needs."

The Case:
Fonseca v. City of Gilroy, No. H028369, 07 C.D.O.S. 3141, 2007 DJDAR 3952. Filed March 23, 2007.
The Lawyers:
For Fonseca (housing advocates): James Zahradka II, Law Foundation of Silicon Valley, (408) 280-2423.
For the city: Andrew Faber, Berliner Cohen, (408) 286-5800.