Huntington Beach Officials Debate Suing State Over Mandatory Housing Quotas

March 26, 2021 Updated: March 29, 2021

Huntington Beach City Attorney Michael Gates recently suggested that the city should consider suing two government agencies over upcoming state-imposed housing mandates, sparking a debate in city council about whether litigation or legislation is a better approach to reducing its allocation.

Gates suggested that the city consider suing the Southern California Association of Governments (SCAG) and the California Department of Housing and Community Development (HCD) over the affordable housing quotas during a closed session of the city council earlier this month.

“There’s not going to be a lawsuit,” Councilman Mike Posey told The Epoch Times, adding that the city chose the best path forward by “taking no action” on Gates’s advice.

Posey said the city should resolve the housing dispute through legislation, not litigation. He added that the city attorney had encouraged the council during a closed session to sue over the city’s housing allotment “without any prompting from any City Council vote.”

Gates, the only elected city attorney in Orange County, told The Epoch Times that it’s his job to ask the council if they want to pursue legal action on such matters.

“Any time we are faced with the city having to take a position or make a decision strategically on a legal matter, I have to go to the City Council and get their direction every time, period. As an attorney, it’s my duty and obligation to not make assumptions about what my client wants, or to inject my own thoughts or views on my client and make a determination as to what they want,” Gates said.

The city of Huntington Beach has been embroiled for years in legal wrangles over the state’s Regional Housing Needs Assessment (RHNA) demands to zone for more affordable housing units in the city. In 2019, the state sued the city for failing to meet its RHNA quotas but later dropped the suit when the city agreed to zone for hundreds of additional affordable housing units in order to qualify for a $650,000 grant.

Huntington Beach is one of many Orange County cities that appealed for lower RHNA allocations at SCAG hearings earlier this year and lost. The RHNA allocations set the zoning quotas for housing for four income levels over the next eight years, beginning in October 2021.

With dozens of bills passed by state legislators in the last few years “to address what is universally recognized as an acute housing crisis in the state of California,” Posey suggested that chances of winning a lawsuit against the state are slim to none.

“I’ve had the position since Day One that RHNA is a legislative issue and not a litigation issue,” he said. “There needs to be legislative fixes in Sacramento to RHNA, and you don’t do that by suing SCAG and HCD—especially when the track record of anybody suing HCD and SCAG has delivered zero results.”

Since 2017, Posey estimated 65 or 70 bills have “passed by the state legislature,” and the SCAG region is still short 1.34 million housing units. “I think that number is debatable, for sure,” he said. “I don’t think the number is that high.”

The councilman, who is a SCAG board member, said that in 2018, Huntington Beach’s 3,612 unit allotment was probably short of demand, “but I expected that we would end up with a 6,000-unit RHNA in ’18, not a 13,000-unit RHNA in 2021.” The final sixth-cycle RHNA allocation for Huntington Beach is currently 13,386 units, to be completed by October 2029.

A Lawyer’s Take

City Attorney Gates said the issue of city versus state control over development isn’t policy, but “more of a philosophy” with regard to governance.

“I strongly believe we should have local control, and if our council wants to have a progressive, prolific housing policy, then fine. But make those decisions at the local level and be accountable to the voters,” Gates said.

“Don’t kick the can or punt to the state and then say, ‘Oh well, the state’s making us do it.’ No, own your decisions. Fight for that ownership and make those decisions.

“The voters should know, and they do know, that I’ve been willing to fight for them every step of the way. No fight is too big, no fight is too small. I’ve been taking every fight, and we’ve been prevailing in the vast majority of the fights that we take both in court and outside of court.”

Even though charter cities such as Huntington Beach historically haven’t been subjected to RHNA mandates, “we’ve gone along with them because we’ve tried to be good stewards in the community,” Gates said, adding that the city has done “far more” than any in the county to update its zoning for RHNA. “We’ve been heroic.”

But lately, the state has “amped up” its housing goals so high that the city is struggling to meet the massive undertaking of the RHNA quotas, he said. “It’s too tall an order for the city. It’s too big a pill to swallow.”

Normally, zoning for RHNA takes most of the eight-year RHNA planning cycle, but now cities “have to do it in 180 days, or we could be penalized,” Gates said.

“There’s a lot of layers to this onion,” including the penalties cities must pay if they don’t meet their RHNA allocations, he said. “State law is very punitive when it comes to cities intentionally not complying with the latest heavy-handed mandate. Depending on the number of violations and the nature of the violations, it’s something like $10,000 per violation per day.”

The Past Lawsuit

In January 2019, Gov. Gavin Newsom and then-Attorney General Xavier Becerra filed a lawsuit against the city of Huntington Beach for failing to meet previous housing quotas “after extensive attempts to offer partnership and support” from the HCD, according to a media release from Newsom’s office.

Newsom had said the state would use Assembly Bill 72 (AB 72), which allowed it to sue cities and counties for willfully defying state housing laws; the Huntington Beach lawsuit was the first such case.

Posey said “bad legislation” and city policies in 2015 “threw the housing element out of compliance,” resulting in an “epic fail” that he had warned about and voted against.

The Kennedy Commission, a nonprofit housing advocacy group, was a party to the lawsuit. After the suit was settled, the group sued the city for $3.5 million in related attorney fees, according to Gates. He called the claim an “odd demand,” since the organization “hasn’t won anything” in the lawsuit, which has dragged on for nearly six years.

That court hearing is scheduled for April 12, and it could cost the city millions. “We’re going to find out … if we’re going to be on the hook for legal fees from the Kennedy Commission,” Posey said.

City Councilman Erik Peterson told The Epoch Times that Posey has supported plenty of litigation against state housing policies in the past—but not lately.

“We have a council that doesn’t really care about what’s going to happen as long as we make the state happy,” Peterson said, and that many local politicians “just want to kiss babies and cut ribbons and not make hard decisions.”

Peterson said he doesn’t believe surrendering local control over zoning and development to the state is in the best interest of Huntington Beach residents, and that litigation is a good way to be heard—but the new council has decided to spend $500,000 a year to help the homeless rather than on legal battles against the state’s housing.

He added that much of the state’s housing policy centers around climate change, reducing carbon emissions, and reducing vehicular traffic, and hinges on transit-oriented development (TOD) or workforce housing.

“We don’t want to be in an urban center on the coast,” said Peterson. “We’d all like to live on the beach in Malibu, but we all can’t afford it. The state’s basically saying anyone who wants to live in Malibu or Huntington should be able to live in Huntington.”