Chino Hills civic leaders this week took a giant step backwards from their previous intrepid position at the cutting edge of a statewide uprising in resistance to the mandates handed down from on high in Sacramento, orders which require that they and the residents they represent, like all other officials and citizens in the individual confines of the Golden State’s various municipal jurisdictions, accommodate further and more densely packed residential development in their city of 82,213.
By the end of a special meeting held on Tuesday, August 16, the council agreed, rather reluctantly, to send a signal to the California Department of Housing and Community Development that the city will go along with allowing the development industry to construct 3,720 residential units within the 44.7-square mile city over the next eight years.
Nevertheless, what was put on display for both the local population and that of the entirety of the State of California is the inadvisability, indeed what some have come to perceive as the absurdity, of allowing Sacramento to dictate land use policy throughout the 163,696-square mile state.Traditionally in California, as virtually everywhere else in the United States, control over construction and development has been vested with local government. The state has building and safety standards which are enforced by both local and state authorities, while planning processes take place generally in California at the municipal and county levels, with the federal and state governments having qualified autonomy on development issues on state-owned and federal-owned land. Land use authority falls within the purview of county government in the unincorporated county areas outside the jurisdictions of towns and cities. Within city/incorporated town limits, that control is exercised by the cities and towns themselves. At the county level, the ultimate land use authority is the board of supervisors and in cities and towns the city or town councils, although at their discretion those panels can delegate to their respective planning commissions the authority to grant a project applicant an entitlement to build.
Under this arrangement, theoretically and for the most part practically, through their elected leadership local residents had some level of control with regard to the tenor of development, its intensity, its quality, its mix, its character and nature, and its density.
In recent years, the cost of housing in California has escalated dramatically beyond what was already a significant inflationary scale. At the same time, the incidence of homelessness has increased. This has prompted state elected and staff officials to seek to induce more intensified home building.
In California over the past seven to eight years, policies pushed by both immediate past Governor Jerry Brown and his administration as well as that of current Governor Gavin Newsom, abetted by the super-majority Democratic legislature, have been exceptionally accommodating of the development industry as part of intensified efforts at solving what has been declared to be a housing crisis.
The California Department of Housing and Community Development has pushed for local jurisdictions to adhere to the developmental mandates derived through an assessment of a survey of housing needs carried out throughout the state. Collated into a document given the title Regional Housing Needs Allocation, those figures provide the basis of the mandates that state officials impose on all jurisdictions, including cities and unincorporated county areas in California, demands that those entities include in their general plans and zoning codes an accommodation of the number of dwelling units specified in the assessment, meaning each city must allow the construction of at least the number of homes the state says is its share of the burden to meet housing demand statewide.
In this way, in what is widely seen, both positively and negatively, as a daring social experiment, the State of California has, through Government Code §65580, required each municipality in the state to assist in alleviating the homelessness crisis by complying with what the California Department of Housing and Community Development deems to be each city’s housing responsibility.
Under this so-called Regional Housing Needs Allocation process, a determination is made of what number of dwelling units according to affordability type each community is to accommodate over an eight-year period. The expectation is that those cities will comply by granting developers clearance to build the specified number of houses within that span.
Based upon the numbers formulated for the state by the Southern California Association of Governments – a joint powers authority consisting of Imperial, Riverside, San Bernardino County, Orange, Los Angeles and Ventura counties – as part of the Regional Housing Needs Allocation effort, San Bernardino County must accommodate the construction of 138,110 new homes between the end of 2021 and the end of 2028, including 35,667 intended for very-low-income homebuyers; 21,903 for low-income homebuyers; 24,140 for moderate-income homebuyers and 56,400 for above moderate-income homebuyers.
In the case of Chino Hills, the state’s expectation was that the city welcome 3,720 more dwelling units from October 2021 to October 2029. Last year, Chino Hills stood up to Sacramento, counter-proposing that instead of the 3,720 homes, it allow 1,797 units, a 52 percent reduction.
Though the vast majority of municipal officials in California accept the state’s asserted authority in this area, up and down the state there has been protest of, and in some cases resistance to, these mandates. Land use policies – from zoning to development standards to architectural guidelines to height restrictions and limitations on density – have evolved gradually over a period of more than a century at the local political levels in response to immediate and regional concerns and conditions. These policies have come to reflect the character of the varied communities and the values, attitudes and expectations of residents/citizens who inhabit those areas. To force not only the individual local governments of the state but the citizens that live in those communities to dispense with standards and polices that have been carefully and methodically developed over decades and generations in favor of meeting what are relatively short-term goals to address the housing crisis and the burgeoning numbers of homeless constitutes a myopic fix to a problem that exists in a much larger context, some social scientists, governmental analysts, politicians and California residents have observed. The imposition of that fix, entailing the construction of residential projects of a vastly higher density than what has been the previous norm, is very likely to result in undesirable consequences that will remain in place and mar the communities in question for decades or even centuries to come, those opposed to the mandates assert.
There has been an upswing in the number of people living in California, from 1,490,000 in 1900 to 10,677,000 by 1950 to 15,870,000 by 1960 to 19,971,069 in 1970 to 23,800,800 in 1980 to 29,950,111 in 1990 to 33,987,977 in 2000 to 37,253,956 in 2010 to 39,538,000 in 2020.
There remains a difference of opinion among the population as to whether intensifying residential development is a sensible response to the general situation. Some have argued that more homes are needed to accommodate the greater influx of people. Others, citing what they consider to be a diminution in the quality of life as the population increases, argue that efforts to limit or end population growth in California is the more reasonable approach to the issue.
California’s government is clearly in the former camp. Nevertheless, within just the last three years, provoked in no small part by the California Department of Housing and Community Development’s insistence that the Imperial County, Riverside County, San Bernardino County, Orange County, Los Angeles County and Ventura County area of Southern California including the 191 cities or towns within those jurisdictions allow without question the construction of 1,341,827 housing units over the next eight-year planning cycle, a group of Southern California civic leaders, in some cases involving majorities of certain city councils, initiated meaningful and concerted steps toward contesting the State of California’s usurpation of what has traditionally been local land use authority.
Among the jurisdictions at the forefront of that movement was the City of Chino Hills.
Most cities in Southern California, reasoning it would do no good to try to fight the state, merely knuckled under to the Department of Housing & Community Development’s regional 1,341,827 housing unit construction mandate. Forty-five cities in the region, however, engaged in an appeal in 2021, in which they were collectively represented by Southern California Association of Governments staff.
In San Bernardino County, the city councils of Fontana, Chino Hills, Chino and Barstow were brave enough to challenge the state. Barstow asked the state to cut its 1,516 house-building mandate by 58 percent to 635; Chino Hills requested 1,797 units in lieu of 3,720, a 52 percent reduction; Chino wanted a 49 percent cut from 6,961 to 3,564; and Fontana insisted that the 17,477 units it was being asked to accommodate was 30 percent too optimistic, requesting that its mandate be reduced to 10,563.
The California Department of Housing and Community Development did not budge in its demands, conveying that the government does not negotiate with scofflaws, renegades, terrorists or any entity or anybody that does not respect the rule of law. Lest anyone forget, California Government Code §65580 is the law, those city officials were warned.
In January, a still-determined Chino Hills City Council, bolstered by an outpouring of resident sentiment, ventured even further down the path of resisting having to surrender land use authority within that city’s confines by scratching Caballero Ranch from the list of properties within the city where it would allow high-density – characterized by some as super-high-density – development to take place. City officials had earlier contemplated allowing the construction of up to 220 units on the 10-acre Caballero Ranch property, located at Peyton Drive and Eucalyptus Avenue. The city had tentatively opened the parcel to intensified development after another proposal for high density apartments/condominiums within Crossroads Marketplace fell through. Officials had included Caballero Ranch on a list of properties that is to be forwarded to the state as potential locations for high density development.
In response, Ed McCoy of Fairfield Residential LLC, the prospective developer of Caballero Ranch, began preparing plans to construct housing that would consist of an average of 22 units per acre on the property. The city council’s action in January removed the Caballero Ranch parcel from the list, dashing McCoy’s hopes and sending a signal to the California Department of Housing and Community Development that Chino Hills was not going to simply fall in line like most other cities and accept the state’s dictates without, if not a fight, then some serious negotiation and compromise.
Over the last seven months, staff with the California Department of Housing and Community Development have been in contact with city officials. Dispensing with discussions of the overall number of homes the city is under the gun to see developed, which yet stands, according to the state, at 3,720 units, the California Department of Housing and Community Development has pressed the city with regard to specific properties within its bailiwick and how they are to be built upon.
On August 16, the Chino Hills City Council held a special meeting, the agenda for which specified the council’s consideration of a “resolution adopting an addendum to a previously adopted mitigated negative declaration and mitigation monitoring reporting program pursuant to the California Environmental Quality Act and approve an amendment to the general plan for the revised 2021-2029 Sixth Cycle housing element,” i.e., the mandate to allow the 3,720 units to be built in the city.
“Before you is the revised housing element for the sixth period planning cycle for 2021 to 2029,” said Planning Manager Michael Hofflinger.
According to Hofflinger, the city adopted the Chino Hills Sixth Cycle Housing Element on February 8, 2022 and sent it to the California Department of Housing and Community Development. In that plan, the city essentially accepted, at least conceptually, the call for the construction of the 3,720 units within the city by 2029. Statutorily, the California Department of Housing and Community Development had 60 days to review the document and memorialize any changes that had to be made. On the 60th day, April 11, 2022, according to Hofflinger, the California Department of Housing and Community Development responded by letter, letting the city know that while the housing element addressed most of the state’s housing requirement, it was deficient in certain respects, those being that it fell down with regard to “affirmatively furthering fair housing,” specifically lacking detail on segregation/integration, concentrated areas of affluence, access to opportunity, disproportionate housing needs, and displacement risk; demonstrating how the Regional Housing Needs Allocation supports fair housing; and identifying and prioritizing factors that significantly contribute to segregation, racially or ethnically concentrated areas of poverty, disparities in access to opportunity, and disproportionate housing needs. According to the California Department of Housing and Community Development, revisions were needed to respond to the requested fair housing analyses. Not only is the state dictating to the city how many homes to build, it wants to control the character and placement of those homes, as well. 
According to Hofflinger, city staff members worked to address the California Department of Housing and Community Development’s concerns expressed in the April 11 letter. After some back and forth, on July 20 the California Department of Housing informed the city that the housing element document was in an acceptable form that would allow it to ratify the housing element document as being sufficient.
Newly adopted legislation, Senate Bill 197, gives the city three years to amend its zoning codes to allow the intensified development envisioned under the Regional Housing Needs Allocation to take place.
Essentially, what the city did was to drop its opposition to the Regional Housing Needs Allocation mandate, signaling it is going along, and avoiding the prospect of administrative, legal or financial retribution by the California Department of Housing and Community Development and the rest of the state government in the immediate or near term.
Among the issues the California Department of Housing and Community Development had taken up was the fate, or intended fate, of the 8-acre parcel at the corner of Boys Republic Drive and Shoppes Drive, also referred to as Shoppes II.
Like the nearby property now developed as the major commercial center Shoppes at Chino Hills, the property is zoned for commercial development. Nevertheless, it appears clear that unless the city changes the zoning to accommodate residential development, the state will seize it and use its authority to transition it into homes, condiminums and apartment buildings.
Since 2020, as city officials were contemplating whether or not to comply with what was then the state’s tentative mandate that it clear the decks for the construction of 3,720 units within the city by 2029 or whether to fight to change that number to 1,797, it made contingency plans to meet the 3,720-unit mandate. One element of achieving that goal was to allow the second major phase of the Shoppes at Chino Hills – Shoppes II – to be developed for mixed use, that is commercial units on the ground floor and apartments atop those, 744 such units to be precise.
According to the California Department of Housing and Community Development, 1,396, or roughly 37.5 percent, of the units to be built in Chino Hills had to be reserved for very low income residents; 820 or roughly 22.04 percent of the units are to be reserved for low income residents; 783 or roughly 21.04 percent of the units are to be reserved for moderate-income residents; and 721 or roughly 19.39 percent of the units are to be reserved for above moderate income residents.
Consequently, even assuming other developments in the city will be accommodating a large number of low and very low-income residents, the California Department of Housing and Community Development insists that at least 112, or roughly 15.06 percent of the 744 units contemplated for construction on the Shoppes II land must be reserved for low- and very low-income housing.
According to Hofflinger, both the city and the eventual developer of the Shoppes II property need to hustle and get a proposal to develop the property, including the reservation of 15 percent of those units for low- and very low-income residents, on the drawing boards by December 2024.
Hofflinger lumped both low- and very-low income units together into a single category he referred to as “lower income.” When pressed to define what lower income or low-income or very-low-income meant in actual monetary terms, he said he did not have precise figures.
“Lower income classifies in two different [ranges], either extremely-low or low,” he said. “I don’t have those exact numbers. It would be considered affordable to those lower income categories, what San Bernardino County considers lower income households.”
Councilman Brian Johsz said it appeared that the state was forcing the city, which owns the Shoppes II property, to sell it to a developer pronto.
“We have a target date for an RFP [request for proposal] of December 2024,” said Johsz. “So that means HCD [the California Department of Housing and Community Development] is essentially forcing our hand on that site?”
“Yes,” Hofflinger responded.
According to Hofflinger and Assistant City Attorney Elizabeth Calciano, the Surplus Land Act adopted in 2015 would allow the city to sell the property at less than its optimal price and at a discount to allow the purchaser/developer to move ahead with the project that would make 15 percent of the units affordable to those in the lower income classes. Calciano said the developer, to get that discount, would need to commit to keep the rentals at the affordable rate for 55 years.
Councilman Art Bennett took issue with the calculation of the affordable rental rates, which he suggested were pushed downward because of the income levels factored in from the less affluent areas of the county. What qualifies as low income elsewhere is lower than what low income is in Chino Hills, he suggested. Chino Hills residents, on average, earn more money than residents in the county’s other 23 incorporated municipalities or anywhere else in the county.
“Basically, the county’s dictated, as far as this income range, mostly by the City of San Bernardino and Highland, that general area,” Bennett said. “Isn’t that true? That’s why in the past it’s never… we’ve never been able to meet those numbers because we’re the highest income in the county. We’ve tried to build them [low-income residential units], but who’s going to build them? We’ve never been able to meet those numbers because we have the highest median income in the entire county.”
Calciano said that the city, as the owner of the property, would itself be involved in the effort to make the units affordable.
“In this case, we actually have the property,” Calciano said. “So, we make it a condition of purchase. We, in effect, are funding that, because we’re selling it for a lower price because they have to make 15 percent of them affordable. So, this is how it will get funded. It is arguably a state mandate.”
“Since it is reducing our sales price, isn’t that some sort of a public taking?” Bennett asked, hinting that the city might be able to recover something from the California Department of Housing and Community Development for being forced into a sale of the property below its actual market value. “Isn’t there some issues there? Obviously, it’s kind of a reverse of an eminent domain situation. Is there anything we can do? It is like a reverse condemnation.”
“What we have is the constitutional amendment that allows us to go to a commission on state mandates,” Calciano said. “Public entities, unfortunately, don’t have the right – we aren’t an entity that is protected under the condemnation laws. The state can take things away from us. Fortunately, 20 or 30 years ago they passed the law that says the state, if they take something away from us, then there’s the commission on state mandates that we can go to that we can seek compensation for. We’d have to prove it up. And of course, it’s their administrative law judges, so it’s not exactly… it doesn’t always seem like it’s the fairest court when you are public entity, but ultimately if we can prove they’ve taken value away from our property, we might be able to make a claim for that.”
Slyly, Mayor Ray Marquez suggested that the city can calculatedly make a show of cooperating with the state on the housing issue at this point and see if other challenges to the state’s commandeering of land use authority succeed before the 3,720 units are actually built.
“There is RHNA [Regional Housing Needs Allocation] reform that’s moving through right now,” said Marquez. “We’re aware of that, correct? This could change?”
“We are aware of that, yes,” said Hofflinger. “We’re not sure how much it’s progressed, but yes.”
The city council – four men and a woman who do not fit the bill of wild-eyed, Molotov cocktail-throwing radicals ready to storm the state capitol to prevent the state government from usurping the city’s traditional land use authority – in the end determined that discretion was the better part of valor.
Marquez said that the state has already given landowners the right to subdivide their property without the city interfering. He said trying to challenge the state could result in the state piling on and letting developers have their every which way with the city.
“If somebody wants to subdivide one piece of residential property into two parcels, two duplexes or four units, they can do it,” he said. “We have nothing really to say about it. So, yes, I am concerned that if we don’t comply this can happen to us even further.”
Calciano said that the state has created a set of “progressive” penalties that can be imposed on cities which were designed to force them into compliance with giving up their land use authority. Those penalties include a process to seize any available city property that wasn’t cleared for being developed to the more intensive standards the state wants applied and putting it into the hands of a receiver so the land would be developed. She said other punishments the state has up its sleeve include withholding tax revenue and grants from cities that do not meet the housing mandates.
“They’ve tried to sew up every possible way to make us kneel,” Calciano said.
“The sad thing is the state is usurping our planning power,” said Bennett. “When we really have no right to plan properly for development within the city and it’s now being forced upon us, that’s just inherently wrong. I don’t know how you stop this speeding train, because it’s going, it’s gathering steam, and its just running over everybody. This is an unreasonable mandate. We know there’s a housing problem. It’s statewide. The problem goes beyond that, because when they do finally build the housing, who is going to be able to afford it? The very people that we’re supposed to be protecting or trying to help out, the low-to-moderate-income housing people, will they even be able to afford something at that point in time? It’s almost unresolvable at this point, given the constraints we have.”
Councilman Peter Rogers said, “We’re voting for the wrong people to represent us in the State of California to take away all of or many of our abilities to make our own decisions as a city.”
In the end, the council receded from the position it once held at the forefront of cities testing the authority of the state.
“We don’t want to do this,” said Marquez.
The council voted unanimously to submit the housing element document that met all of the California Department of Housing and Community Development’s standards.
-Mark Gutglueck