Builder's Remedy Puts High-Rises Next to $1M Bay Area Homes

Developers have lined-up to build high-density builder’s remedy housing in some of the toniest Zip Codes in the Bay Area, bedroom communities where every home fetches prices well in excess of $1M.

Since California invoked its builder’s penalty remedy for cities that failed to file approved plans to develop new housing—which permits affordable housing developers to bypass local zoning officials—more than 34 project plans totaling more than 6,400 units have been filed in 11 cities, according to a Bay Area News Group survey.

The projects include eight-story condos that will be perched over houses in Los Altos Hills as well as 150 units on a hillside in rural Marin County. Many of the projects target affluent areas that have long resisted large housing projects, the San Jose Mercury News reported.

According to the newspaper, the Bay Area tally of builder’s remedy projects includes 15 projects in San Jose; five in Mountain View; three in Palo Alto; three in Los Altos Hills; two in Brentwood; as well as single projects in Menlo Park, San Mateo, Pleasanton, Sonoma, Fairfax and Marin County.

In Southern California, where builder’s remedy penalties went into effect earlier than in the Bay Area, several cities have resisted the imposition of the penalties, producing a court challenge to the remedy.

In March, California filed a lawsuit against Huntington Beach, which in February adopted a ban on approving applications for builder’s remedy projects, seeking to strike down the ban as a violation of the state’s housing law.

The Orange County city responded by immediately filing a federal lawsuit challenging the state’s requirement that Huntington Beach rezone neighborhoods to make way for more than 13,000 new housing units.

In its lawsuit the state asked for a preliminary injunction to prohibit Huntington Beach’s ban from taking effect while the case is adjudicated, the Los Angeles Times reported. California Attorney General Rob Bonta, at a news conference announcing the lawsuit, said Huntington Beach’s ban had “infringed on the rights of property owners.”

“California is facing an existential housing crisis, one we should all be acting in unison to solve,” Bonta said. “Instead, the Huntington Beach City Council has chosen to stifle affordable housing projects, infringe on the rights of property owners and knowingly violate state housing law.”

Huntington Beach Mayor Tony Strickland held his own press conference, at which he said the state is “not serious about producing more housing.”

“Their goal is to urbanize quiet private property-owning communities,” Strickland said, according to the Times report. “This lawsuit filed by our city attorney is the first major step in taking the governor and the state to task over their faulty narratives about housing and their unconstitutional legislative and administrative means of stripping charter cities of their ability to make their own decisions.”

The lawsuit sets up the first major legal challenge to builder’s remedy, which is being imposed by the state on cities that fail to submit an approved housing growth plan.

Builder’s remedy is a legal remedy, created in the 1990s, that can be invoked to allow developers to bypass local zoning requirements—any kind of city zoning or planning approval process—essentially a state override of local authorities that now is being invoked in what the governor is calling a housing emergency.

The measure approved in Huntington Beach blocks building applications for housing construction filed under builder’s remedy on the grounds that the construction could “adversely impact public safety and the environment.”