California AG accuses city of Elk Grove of violating state housing laws; City responds

California Attorney General Rob Bonta has put the city of Elk Grove on notice, saying that the city violated state housing laws when it denied the Oak Rose Apartment project in the Old Town Elk Grove area. The city stated the project didn’t conform to the Old Town Special Planning Area as the reason for the denial of the project.

Bonta’s letter and the city of Elk Grove’s response can be seen below

SACRAMENTO — California Attorney General Rob Bonta today issued a letter to the mayor of Elk Grove putting the city on notice that its denial of a proposed supportive housing project in the City’s Old Town Special Planning Area (OTSPA) violates state laws including Senate Bill 35 (SB 35), the Housing Accountability Act (HAA), and fair housing laws intended to prohibit discriminatory land use practices. The proposed project, known as the Oak Rose Apartments, would have added 66 units of supportive housing for lower-income households at risk of homelessness, in a jurisdiction in dire need of low-income housing opportunities. The Elk Grove City Council improperly denied the project, claiming that it did not meet the City’s zoning standards and was therefore ineligible for SB 35 ministerial review. Attorney General Bonta urges Elk Grove to take prompt corrective action to realign with state law.

“Confronting and addressing our state’s housing crisis requires all of us – including local governments – working together to increase affordable housing opportunities for those who need it most,” said Attorney General Rob Bonta. “Too many Californians across this state worry about keeping a roof over their heads, or lack housing altogether. State housing laws are in place to provide all Californians, regardless of income level, the opportunity to access affordable housing and have a place to call home. We’re committed to enforcing the law, and we will not stand idly by in the face of housing discrimination. I urge Elk Grove to reconsider its unlawful denial of the Oak Rose Apartment project, or face the legal consequences.”  

On July 27, 2022, Elk Grove’s City Council denied approval of the Oak Rose Apartments project. Following that denial, the California Department of Housing and Community Development (HCD) issued a Notice of Violation, warning the city that the denial of the low-income housing project violated state housing laws, including SB 35. SB 35 requires local governments to provide streamlined, nondiscretionary approval of some projects when they are consistent with objective zoning standards. Elk Grove’s City Council sent a response letter on November 10, 2022, arguing that the project did not qualify for approval under SB 35 because the multi-story project included residential units on the ground floor, which the City contends violates a zoning requirement that ground floor spaces be reserved for commercial uses, such as space for retail, restaurant, or office space. 

In today’s letter Attorney General Bonta puts Elk Grove on notice that contrary to the City’s claims, this use restriction does not qualify as an “objective standard” under SB 35 or the HAA, because its application depends on the exercise of discretion. The city itself acknowledged that its OTSPA standards – including the ground floor use restriction – involve discretion, noting that the city has a mechanism to deviate from development standards under the OTSPA for projects that meet the goals of the OTSPA, including whether a project is compatible with “community character”. Because the HAA and SB 35 prohibit the application of a standard that involves any discretionary application, the city cannot rely on this use restriction as a basis to deny the Project.

Attorney General Bonta also argues that Elk Grove’s unequal application of the cited land use restrictions, and subsequent denial of the Oak Rose Project constituted a discriminatory land use practice, which violates the Affirmatively Furthering Fair Housing Statute and Government Code Section 65008, which prohibit the city from making land use decisions that disproportionately harm lower-income households. Local governments violate Section 65008 whenever a land use decision is based on discriminatory intent or has a discriminatory effect. Attorney General Bonta’s letter today contends that there is evidence of both in Elk Grove’s decision to deny the Oak Rose project:

• First, the city allowed a market-rate housing development located within the OTSPA, the Elk Grove Railroad Courtyards Project, to move forward despite the presence of ground floor residential units. The city found that Railroad Courtyards was consistent with planning standards, and completely avoided any discussion of the same use restrictions that it cited in the Oak Rose Project as a reason to deny the project, evidencing discriminatory intent.
• Second, with the Oak Rose project, the city adopted a strict interpretation of the use restriction, claiming it is an outright prohibition of ground floor residential units, which disproportionately affects low-income persons.

The city thus adopted two conflicting interpretations of the OTSPA use restriction for two similarly situated projects serving different populations. It applied a more permissive interpretation to approve a lower density market-rate project, and it applied a stricter interpretation to disapprove the Oak Rose Apartment project, a higher density lower-income supportive housing project.

In fact, city staff found that the Oak Rose project was consistent with the city’s land use policies, and therefore, there was no compelling purpose to override the discriminatory effect of the City’s denial. The residents who would benefit from the housing would be needlessly forced to look elsewhere for similar housing opportunities.

In 2021, Attorney General Bonta announced the creation of a Housing Strike Force within the California Department of Justice aimed at advancing housing access across the state. Members of the public are encouraged to visit the California Department of Justice’s Housing Portal and HCD’s website for more resources and information aimed at supporting access to housing.

A copy of the California Department of Justice’s letter to Elk Grove is available here.

California Attorney General

City of Elk Grove’s response: