The City of La Cañada Flintridge has fired back against a developer trying to invoike builder’s remedy by taking square aim at the idea that the Department of Housing and Community Development has independent authority to determine whether a housing element is compliant or not.

Only the courts have that power, the city said in its recent rebuttal to the developer’s July lawsuit. In the rebuttal, the city also said it doesn’t have to pursue Affirmatively Furthering Fair Housing (AFFH) goals required by HCD because the U.S. Supreme Court recently struck down affirmative action in Students for Fair Admissions v. Harvard.

In its lawsuit filed in late July, the developer of the proposed project in La Cañada Flintridge, Glendale-based Cedar Street Partners, alleges that after it approved the housing element in October 2022, the city engaged in a shifting position, requiring additional information to deem the builder’s remedy complete, then supposedly applying new city-approved standards to the project and “backdating” a revised housing element before finally denying the project in May. (CP&DR’s coverage of the developer’s lawsuit can be found here.)

In its rebuttal to the Cedar Street Partners lawsuit, the city took direct aim at the most important question on housing elements and the builder’s remedy right now: Whether a city can “self-certify” a housing element in order to avoid the builder’s remedy, which kicks in when a housing element and subsequent zoning changes are not adopted on time. In La Cañada Flintridge, the city and HCD continued to go back and forth after the housing element was approved, which the city said involved minor issues and the developer said proved the project was not in compliance.

But in its rebuttal to the lawsuit, the city took a very strong position: That HCD does not have the legal power to determine whether or not a housing element is in compliance. “HCD cannot be given or wield any power to finally determine that a Housing Element is not “substantially compliant” with the Housing Element Law,” said the city’s response.

“In its governing statutes (Cal. H&S Code §§ 50000et. seq. and 50400-50709),” the court wrote, there is no power delegated to HCD to hold hearings OR admit evidence concerning ‘substantial compliance.’ Petitioner’s contentions are that HCD has an unrestricted authority to deem substantially compliant, or not, a City’s Housing Element. Such a determination of ‘substantial compliance’necessarily derives from a fundamental policy decision, namely laws enacted by the legislature which define such compliance and delegate to the judicial branch authority to review a Housing Element and adjudicate substantial compliance. Such an unchecked adverse determination by HCD in turn triggers the potential for imposition of penalties on cities, and thus is violative of long-standing rules.

The city also took a strong position on Affirmatively Furthering Faith Housing (AFFH), which has been a strong emphasis in housing elements by HCD ever since Gustavo Velasquez took over as director. Valesquez was Assistant Secretary for Fair Housing at the federal Department of Housing and Urban Development in the Obama Administration and championed a federal AFFH rule there. Since moving to Sacramento he has similarly championed AFFH in virtually all HCD activities, including housing elements.

  • But La Cañada Flintridge claimed the recent Supreme Court ruling striking down affirmative action in higher education rendered the whole AFFH discussion moot. Even though AFFH has generally been derived from fair housing law, the city invoked civil rights law in arguing: “Like the preferences at issue in Harvard, [t]he preferences here are not sufficiently connected to the alleged justifications to withstand strict ”

The city’s response is appended to this article.

The Case:

600 Foothill Owner v. City of La Cañada Flintridge, Los Angeles County Superior Court No. Los Angeles County Superior Court No. 23STCP02575 (filed July 21, 2023).

The Lawyers:

For City of La Cañada Flintridge: Adrian R. Guerra, Aleshire & Wynder, aguerra@awattorneys.com.

600 Foothill Owner: Ryan M. Leaderman, Holland & Knigh, ryan.leaderman@hklaw.com