La Cañada Flintridge doubles down on builder’s remedy fight   

Wealthy city claims right to self-certify its housing plan with “substantial compliance”

Cedar Street Partners' Alexandra Hack and La Cañada Flintridge mayor Keith Eich (Getty, LinkedIn, City of La Cañada Flintridge)
Cedar Street Partners' Alexandra Hack and La Cañada Flintridge mayor Keith Eich (Getty, LinkedIn, City of La Cañada Flintridge)

The La Cañada Flintridge City Council voted this week to uphold its denial of a builder’s remedy application, a decision that both deepens one of Southern California’s fiercest development battles and sets up a likely face off with state authorities. 

The May 1 council decision involving 600 Foothill Boulevard came after the project development team had appealed an earlier council decision denying the same application. More significantly, the council’s denial is based on an argument that La Cañada Flintridge is not actually subject to builder’s remedy — the California legal provision that allows developers to bypass local zoning in cities that are failing to meet state-mandated housing planning goals — because the town has “self certified” its own Housing Element.  

“In consideration of the actual elements of the law … we are, in good faith, able to say that we had a compliant Housing Element in October of 2022,” Councilmember Kim Bowman said during the meeting. “On the basis of that fact … builder’s remedy is not applicable in this case.” 

It’s a rationale that amounts to a direct, high-stakes challenge to California state authority. Under generally accepted procedure, the California Department of Housing and Community Development (HCD) — not the cities themselves — is in charge of certifying each city’s Housing Element update, with cities that fail to reach agency compliance subject to penalties that include builder’s remedy. 

The state HCD has determined that La Cañada Flintridge, after submitting multiple drafts, is still out of order on a Housing Element update that was due in October 2021. 

‘Substantial compliance’

Bowman and the council acknowledged in the May 1 meeting that HCD has not yet granted its sign off, but — buttressed by arguments from the city attorney — claim La Cañada actually reached a legal threshold of “substantial compliance” when it adopted a version of its Housing Element in early October, thereby negating the developers’ later builder’s remedy application. 

“We’re hoping the state sues,” said Garret Weyand, a partner on the development team for 600 Foothill. “At the end of the day, if this were to succeed … the city would basically be saying HCD doesn’t matter anymore. Any city can just say, ‘We’ve checked all the boxes, we’re good, and it doesn’t matter what you say.’” 

“It really is brazen,” said Alexendra Hack, another development partner and a principal at Cedar Street Partners. “This is like Huntington Beach 2.0,” she added, quoting her attorney. 

The Orange County beach city, under new political leadership following November’s election, has in recent months embarked on a dramatic, highly ideological battle against Sacramento over state housing laws, including with one failed attempt to ban builder’s remedy applications outright. State authorities, including Attorney General Rob Bonta and Gov. Gavin Newsom, have responded by singling out the city for harsh criticism. “Time and time again, Huntington Beach has demonstrated they are part of the problem,” Bonta said in one release. Bonta also filed a lawsuit that could suspend the city’s permitting authority, among other consequences. Huntington Beach politicians have only dug in deeper, repeatedly framing the housing law fight as a kind of existential battle. 

The California Attorney General’s Office has not yet weighed in on the builder’s remedy saga unfolding in La Cañada, although one pro-housing nonprofit, Californians for Homeownership, does have a suit pending against the city that seeks to clarify that developers can use builder’s remedy.  

HCD issued its latest rejection of the city’s Housing Element draft on April 24. Asked about La Cañada’s latest builder’s remedy denial, a representative for the agency said the matter was “an open investigation” and declined to comment further on how it might proceed. 

Embattled project

The fight over 600 Foothill, an inconspicuous 1.3-acre property off the town’s main commercial strip, began in 2015, when a Bay Area-based senior housing firm proposed a plan to replace an aging church building with a new senior living facility. Yet those plans ignited an intense backlash from neighbors — one executive even reportedly received a dead rat in the mail — and the firm eventually pulled out. 

The current development team initially planned a smaller senior housing project with a mixed-use component, believing they would fare better in part because the team is local. 

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“We’re going to be welcomed with open arms,” Weyand remembered thinking. “It’s going to be great.” 

Instead the new team, which includes Weyand, Hack and another partner, Jonathan Curtis, who previously served as town mayor, also ran up against a fierce, often personal opposition campaign. In November, they decided to file for a new builder’s remedy project after the city denied its traditional project application. 

“You know what, we’ve been in this for long enough,” Hack said previously of her thinking at the time.

The new application is for a five-story project that would include a total of 80 residential units and 16 low-income units — effectively more new housing than the upscale small city has built in years. 

‘Overrule the state’

La Cañada’s builder’s remedy rejection comes after other cities around the state, including Sonoma and Los Altos Hills, have also claimed they are not subject to the penalty because they have “self certified” their own Housing Elements. 

In some scenarios, land use attorneys say, cities making such arguments could have a plausible case before state judges. While the courts have consistently ruled that the state does have the authority to issue and enforce housing laws over cities, a potential gray area related to builder’s remedy area emerges on the question of what constitutes “substantial compliance,” the term used in the state’s Housing Element law.  

“I think what a lot of these cities are banking on is that a court’s going to take a look at it and say, ‘Yeah, this is a fairly big penalty for these cities, and nowhere in the statute does it actually say HCD is the one that has to make a determination of substantial compliance,’” said Niran Somasundaram, a San Francisco-based attorney at the law firm Hanson Bridgett. 

Yet the courts are extremely unlikely to disregard the agency’s determinations altogether, attorneys say, and are likely to consider cities’ efforts to actually comply with Housing Element mandates. The best chance for a city to succeed in a compliance challenge, for example, could be over a question of simple timing — if HCD granted compliance in February, say, but the city is arguing it should be deemed compliant in January, when it adopted a Housing Element version that was subsequently approved. 

La Cañada is pushing the argument further by asserting that it became compliant seven months ago, based on the city’s own interpretation of state law and some of HCD’s later feedback, even though the state agency itself has repeatedly determined the city is not compliant.  

The council’s denial vote, which was unanimous, came after passionate objections from both residents and the development team’s attorneys, including some highlighting the small city’s stagnant population and local housing crisis. 

“A week ago the state agency that is charge of this whole issue sent a letter to the city saying, ‘You are not in substantial compliance. It was very clear,” one exasperated resident, David Haxton, told the council ahead of the vote. Yet city staff, he pointed out, just gave a presentation asserting the opposite — that La Cañada is in compliance — without actually addressing the state’s determination. 

“I don’t see how you can basically overrule the state here when you haven’t even heard arguments, any reasonable explanation, why staff is right and the state is wrong,” Haxton said in addressing the council members.

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