Fullerton Under the Gun to Approve State Housing Plan

The City of Fullerton has blown through numerous deadlines to satisfy a state requirement that it plan for more than 13,200 homes by 2029.

Now the Orange County city could lose up to $2 million in state funds if it fails to certify its Housing Element by the end of January, the Orange County Register reported.

The initial deadline to get the plan signed off by the state Department of Housing and Community Development was Oct. 15, 2021.

Fullerton, which sat on its heels, then lost an appeal seeking to lower the number of homes demanded from the state, missed that deadline by a mile.

Then it missed a Nov. 5 deadline that the city vote on a compliant plan set in a legal settlement early this year with Gov. Gavin Newsom, Attorney General Rob Bonta and state housing regulators.

The settlement mandates Fullerton plan for 13,209 homes, 40 percent of them affordable for very low- and low-income households.

“Fullerton has committed to stop litigating and start building,” Newsom said in a statement. “California is facing a housing crisis, and the status quo is simply unacceptable.”

Now Fullerton staff say the revised deadline to update its zoning to build more homes has been pushed to the end of January, from Dec. 29.

The Fullerton City Council, despite the risk of losing state funds and the ability to regulate its own zoning, again bucked at passing a compliant plan this week. It will rehear the issue Dec. 10.

“We’ve got to get this right,” Mayor Nick Dunlap told the council. “We’ve got one shot at it, and it’s going to be a kind of living, breathing, lasting document that is really going to affect and impact our city.”

To meet the mandate moving forward, city planners have proposed a “housing incentive overlay zone,” according to the Register. If adopted by the council, the HIOZ would allow developers to build housing in many areas now coded as industrial or commercial.

But Fullerton council members have struggled to come to terms about where the new overlay should go and how many affordable units the city should require developers to build.

In November, residents told the council that zoning for more homes in those areas could worsen traffic congestion and change the physical character of the city.

The state recommends that Fullerton require developers to build at least 10 percent affordable units for any project.

Fullerton council members have suggested raising that minimum to 20 percent, half for low-income housing and half for moderate-income housing.

But city staff warned the state might reject a local plan that requires that much affordable housing because a 20 percent affordable housing minimum could dissuade developers from building in Fullerton — killing the city’s entire housing plan.

“I hate to use this expression, but I think it’s a reasonable one,” Councilwoman Shana Charles told the council. “At this point, we have a bit of a gun to our heads.”

— Dana Bartholomew