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On Monday (January 12), the City's highly publicized "Family Zoning Plan" became legally effective. The Friday before, January 9, familiar CEQA plaintiffs attorneys Richard Drury and Susan Brandt-Hawley filed a CEQA lawsuit challenging the City's environmental review of the Family Zoning Plan. The lawsuit raises a number of questions about the Family Zoning Plan moving forward.
Background
To recap, the Family Zoning Plan is the City's rezoning plan to implement the Housing Element adopted in January 2023. State law required the Housing Element to demonstrate the City could accommodate 82,069 new dwelling units (94,300 with the required 15% contingency) over the Housing Element period (2023 – 2031). The City certified an EIR for the Housing Element under CEQA. The EIR studied the potential environmental impacts of the construction of the required 94,300 dwelling units.
State law also requires the City's zoning controls to have capacity for the construction of the 94,300 units. The Planning Department calculated that under existing zoning rules and planned developments, the City could accommodate 58,100 units, leaving a 36,200-unit shortfall. This is where the Family Zoning Plan comes in. The Family Zoning Plan revised the City's zoning to accommodate 36,200 more units. State law requires the City to adopt its rezoning by January 31, 2026.
For its environmental review of the Family Zoning Plan, the City adopted an Addendum to the EIR for the Housing Element finding in effect that no additional environmental review was required for the Family Zoning Plan because the environmental impacts of the new zoning were adequately identified and analyzed in the Housing Element EIR.
The Lawsuit
The lawsuit filed on January 9 challenges the City's reliance on the Housing Element EIR for its environmental review. The lawsuit alleges that the Family Zoning Plan created new environmental impacts that weren't studied by the Housing Element EIR. The lawsuit seeks to set aside the approval of the Family Zoning Plan while the City conducts additional environmental review. The lawsuit also seeks a "stay" of implementation of the Family Zoning Plan while the lawsuit is pending. Implementation of the Family Zoning Plan presumably would include entitlements and permits issued under the authority of the new zoning.
Implications of the Lawsuit
At the present time, the City is continuing to process applications that utilize the Family Zoning Plan. Our firm's applications that rely on the Family Zoning Plan are moving forward.
If the lawsuit is successful and the Family Zoning Plan approval is set aside, the City may find itself out of compliance with state law because it wouldn't have approved its Housing Element implementing zoning by January 31, 2026. It's unclear what position the state Department of Housing and Community Development would take in that situation. It may be the case that the Builder's Remedy law could apply. Please see our September 12, 2024 update describing the amended Builder's Remedy law.
Finally, to obtain a stay suspending the implementation of the Family Zoning Plan while the lawsuit is pending, the petitioners must bring a motion for the stay (they have not done that yet) and the court must grant the stay. Unlike an injunction where the court's primary consideration is whether the petitioners are likely to prevail on the merits, the court's primary consideration in this context is whether granting the stay is against the public interest. This is arguably a lower threshold than injunction. We will continue to monitor the lawsuit and keep readers informed, in particular concerning any attempt by the petitioners to obtain a stay.
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