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City Takes Steps to Fight 'Builder's Remedy' Projects

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By Jorge Casuso

October 26, 2022 -- The City of Santa Monica has hired an attorney to help fend off a flurry of development proposals rushed under an obscure State law this month, top City officials said Monday.

The move comes as a startled City Council prepares to weigh legal options as City planners begin processing preliminary applications for 16 projects totaling more than 4,500 units ("City Officials Caught Off Guard by Flurry of Development Submissions," October 13, 2022).

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The proposals, all but one of which the Council can fight, were submitted under a builder's remedy provision in State law that allows developers to bypass the City's zoning laws if its Housing Element is not in compliance.

In a briefing to the City Council, top officials placed much of the blame on the State's Department of Housing and Community Development (HCD), which they said gave unclear guidance and delayed granting final compliance.

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"It's important too realize," City Attorney Doug Sloan said, "that the rules were not always very clear, and it was somewhat of a moving target from the State.

"I don't think over the last 18 months the Council or staff could have done anything differently to avoid being where we are," Sloan said.

"We made our best efforts to be in compliance, and then at some points HCD changed the rules or clarified a different rule than what we thought it was up until that point. "I think the City was doing its best to be in compliance, and the time line often was driven by review periods from HCD, not the City engaging in any kind of delay."

Sloan, along with City Manager David White, noted that 15 of the preliminary applications -- which were submitted by WSC and NMS between October 1 and October 14 -- will not proceed until final applications are filed.

They noted that developers have six months to submit their final applications from the date when the preliminary applications were filed.

In addition, the proposed projects are by no means a done deal, Sloan and White said. They are still subject to the strict standards set by the California Environmental Quality Act (CEQA), as well as local regulations.

Last week, the City Attorney's office retained a legal firm experienced in housing law that currently represents some 30 California cities, Sloan told the Council.

The firm will help Santa Monica explore its options, which could include questioning the date the Housing Element was deemed compliant.

Sloan noted that in a letter dated September 6, HCD informed the City that the updated Housing Element it submitted July 8 with "red-line" revisions was in compliance.

"We were in substantial compliance at that point, and so some of these builder's remedy applications we received after that we may not have to treat that way," Sloan said.

The Housing Element approved by the Council on October 11, however, was not officially certified by State officials until October 13, after four additional applications were submitted, an issue Sloan acknowledged.

Councilmember Gleam Davis wanted to know if the City would ask HCD to "clarify some of the ambiguities" in the builder's remedy provision the developers used.

Deputy City Attorney Susan Cole responded that it was "definitely a possibility" but cautioned that the State would likely side with housing providers.

"I think we can anticipate that whatever their input is would be to favor, if there is any doubt, more housing," Cola said.

She added that the City is "definitely looking at these substantive legal interpretations of the statute."

City Manager White said a review he conducted over the weekend found that 124 Southern California cities did not have compliant housing elements, including Beverly Hills, Malibu and West Hollywood.

A developer this week submitted a proposal in Beverly Hills under the builder's remedy, the only reported filing outside of Santa Monica.

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