A City of West Hollywood moratorium on new multi-family housing development has been declared invalid by the Second District Court of Appeal. The court ruled that the city had not made required findings for the moratorium.

Under state law, the city had to adopt written findings to "identify both (i) a specific ‘significant, quantifiable, direct and unavoidable impact' upon the public health or safety that would result from continued development approvals, and (ii) objective ‘written public health or safety standards, policies, or conditions' on which that impact is based," the court stated. The city's moratorium findings failed to comply, the court ruled.

In June 2007, the West Hollywood City Council approved a 45-day interim ordinance prohibiting – with a few exceptions under interim standards – the issuance of permits for new multi-family dwellings. In July 2007, the City Council extended the moratorium by 10 months and 15 days. A final extension was approved in May 2008. The city stated that a recent proliferation of applications was resulting in fewer and larger multi-family units than were desired to meet the city's housing needs. Essentially, the city sought more and smaller units to increase affordability. The city also began revising its general plan land use and housing elements.

Among the applications pending when the city first adopted the moratorium were one by Hoffman Street, LLC, and one from Harper Project LLC. Hoffman wanted to demolish a 16-unit apartment building on North Hayworth Avenue and construct a 17-unit condominium complex on the site, Harper sought approval to demolish a 15-unit apartment building on North Harper Avenue and construct 16 condominiums on the property.

After the city approved the July 2007 moratorium extension, Hoffman and Harper filed a joint lawsuit arguing the city violated the Planning and Zoning Law (Government Code § 65000 et seq.), the Permit Streamlining Act and the California Environmental Quality Act, denied the developers' rights of due process and equal protection, and took property through inverse condemnation. A Los Angeles County Superior Court judge ruled for the city. On appeal, and a unanimous three-judge panel of the Second District, Division Three, overturned the lower court.

The city first argued that the appeal was moot because the moratorium had expired earlier this year. But the court said that although the appeal was "technically moot," the appeal presented "an issue of continuing public interest" that deserved consideration.

At issue was the interpretation of Government Code § 65858, subdivisions (c) and (g). Subdivision  (c) outlines the findings necessary for extending a 45-day moratorium. Subdivision (g) says that certain findings are not required for a moratorium involving demolition or conversion of multi-family housing units or that results in decreased affordability. The city argued, and the trial court agreed, the developers' projects were the types of development described in subdivision (g).

However, the nature of the developers' projects did not relieve the city from having to make the findings required under subdivision (c), the appellate court ruled. "[W]hether the statutory findings are required depends not on the effect of an interim ordinance on a particular applicant challenging an extension, but on the effect of the interim ordinance generally," Justice Walter Croskey wrote for the court.

The court then cited from the statue: "We conclude that by prohibiting the issuance of permits or other approvals for the development of any ‘new multi-family structures' not in compliance with the interim zoning standards, the interim ordinance had the effect of requiring the denial of some applications for the development of multi-family housing and therefore had ‘the effect of denying approvals needed for the development of projects with a significant component of multi-family housing' within the meaning of the statute. Because the interim ordinance had that effect, the city was required to make the findings set forth in paragraphs (1) through (3) of Government Code § 65858, subdivision (c)."

Under those paragraphs, the city must find there is a specific, adverse impact upon public health and safety, the moratorium will mitigate or avoid the impact, and there is no feasible alternative to the moratorium. The West Hollywood City Council had found there was a "significant unmet need for smaller affordable housing units" and recent projects were not increasing the number of units adequately. The city's findings, the court determined "failed to identify any specific impact on public health or safety." The findings also did not identify written standards or conditions for determining an impact, and did not address a less burdensome alternative. Thus, the court ruled the moratorium was invalid.

The court rejected the Permit Streamlining Act claim, and it declined to consider the CEQA claim. The court directed the trial court to reconsider the claims regarding due process, equal protection and inverse condemnation.

The Case:
Hoffman Street LLC v. City of West Hollywood, No. B210789, 2009 DJDAR 16525. Filed November 23, 2009.
The Lawyers:
For Hoffman: Benjamin Reznik, Jeffer, Mangels, Butler & Marmaro, (310) 203-8080.
For the city: Michael Jenkins, Jenkins & Hogin, (310) 643-8448.