Save Lafayette v. City of Lafayette_ 85 Cal. App. 5th 842  - Avdid & Cucchi
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Save Lafayette v. City of Lafayette_ 85 Cal. App. 5th 842 

Save Lafayette v. City of Lafayette_ 85 Cal. App. 5th 842 

In Save Lafayette v. City of Lafayette, the First Appellate District addressed whether a housing development project conflicted with a city’s general plan as it existed when the project was revived in 2018, if an environmental impact report (EIR) was inadequate as an informational document, and if a supplemental EIR was required

O’Brien Land Company, LLC (O’Brien), completed an application for a 315-unit residential development project in 2011, and the City of Lafayette (the City) certified an EIR in 2013. Before the project was approved, the applicant and the City agreed to suspend processing of the original project while the applicant pursued an alternative, smaller proposal. In 2018, when it proved impossible to proceed with the alternative project, O‘Brien and the City revived the original proposal, with some modifications. The City finally approved the resumed project in 2020, after preparation of an addendum to the original EIR. In so doing, it concluded the project qualified as a “‘housing development project’ ‘for very low, low-, or moderate income households’” under the Housing Accountability Act (HAA). As a result, the City found, the HAA preempted conflicting requirements of the Lafayette Municipal Code, and the project was exempt from certain findings the City normally required in order to obtain the necessary permits.

Save Lafayette filed its petition for writ of mandate in September 2020, alleging that, in violation of CEQA, the 2013 EIR did not adequately analyze a number of environmental impacts and that an SEIR was necessary. It also alleged the project was inconsistent with applicable general plan and zoning requirements, arguing that the project is governed by the standards in effect in 2018, when the applicant terminated the process agreement and asked the City to resume processing its application, not by the standards that existed in 2011, when its application was deemed complete. The trial court denied the petition. The court found that, despite the delay while the parties pursued the smaller Homes at Deer Hill project, respondents were entitled under the HAA to the benefit of the zoning in place when the application for the apartment project was deemed complete in 2011.

The California Legislature has established limited exceptions to general land use and zoning rules in the HAA. The HAA was enacted in 1982 in an effort to address the state’s shortfall in building housing approximating regional needs, and the Legislature has amended the law repeatedly in an increasing effort to compel cities and counties to approve more housing. The HAA provides that when a proposed housing development complies with objective general plan, zoning, and subdivision standards and criteria in effect at the time the application is deemed complete, the local agency may disapprove the project or require lower density only if it finds the development would have specific adverse effects on public health or safety that cannot feasibly be mitigated.

Thus, even if a project is inconsistent with the current general plan or zoning standards, under the HAA it may need to be approved if it was consistent with standards existing when the application was deemed complete.

Once a development application is deemed complete, the Permit Streamlining Act (PSA) establishes deadlines for a public agency to approve or disapprove it, which vary with the extent of environmental review required. That is, if the agency fails to act within the statutory period and the applicant provides timely notice (enabling the agency to cure), the project may proceed without agency action, as if it had been approved. Government Code section 65957 indicates that the PSA‘s time limits may not be waived by either the project applicant or the lead agency.

The question before the court became whether, under the HAA, the general plan and zoning standards in effect when the application was deemed complete in 2011 govern the project, or whether the PSA‘s time limits deprived the City of the power to act on the application, such that the applicant must be treated as if it had resubmitted its application when it asked the City to resume processing an apartment application in 2018.

According to Save Lafayette, O’Brien’s request to resume processing should be treated as a resubmission in June 2018 of its project application, or the application should be deemed resubmitted and reviewed under the standards in effect on a new “‘deemed complete’” date. In practical effect, Save Lafayette’s interpretation would mean the application was deemed disapproved by operation of law when the City failed to act on it within 180 or 270 days. But the PSA says no such thing. Rather, the consequence the statutory scheme provides for failure to act is that a project is deemed approved, if notice requirements are met. Specifically, if an agency fails to approve or disapprove a development project within 180 or 270 days after certifying an EIR, the applicant may elect to provide the necessary public notice that the project will be deemed approved if the permitting agency does not act within 60 days of the notice.

The court rejected Save Lafayette’s reading of the PSA for four reasons:

  • First is the fact that the statute nowhere states that an application is deemed withdrawn, deemed disapproved, or deemed resubmitted at a later date if, after the agency fails to act within the PSA‘s time limits, the applicant fails to perfect its right to “deemed approval.” 
  • Second, Save Lafayette contends that the applicant’s request for continued permit processing on the resumed project served as a resubmittal of the project application, and that the application should be deemed complete on the date of this ostensible resubmittal. For this view, Save Lafayette relies on Government Code section 65943, the PSA‘s provision for determining an application’s completeness. But in the context of the statute, a “resubmittal of the application” refers to a resubmittal in response to a notice that an application is incomplete, after which the agency has an additional 30 days to assess the application’s completeness. That is not what happened here, where the City found the application to be complete in 2011, no resubmission was required, and no reevaluation of the application’s completeness occurred. 
  • The third reason the court rejected Save Lafayette’s construction of the statute is that it stands in tension with the provision of the PSA that expressly addresses disapproval of applications. Government Code section 65952.2 states that “[a]ny disapproval of an application for a development project shall specify reasons for disapproval other than the failure to timely act in accordance with the time limits” of the PSA. If the 2011 project application were deemed disapproved, that disapproval would only be because of the City’s failure to “act in accordance with the time limits” of the PSA. And, of course, such silent disapproval would have occurred without anyone “specify[ing] reasons” for it.
  • The Fourth reason the court construed the PSA to avoid deemed disapproval here is that they are not dealing with the PSA in a vacuum, but rather in its relation to the HAA. The Legislature has found that California has a “housing supply and affordability crisis of historic proportions” and that millions of Californians are hurt by the “consequences of failing to effectively and aggressively confront this crisis.” The court is accordingly directed to interpret and implement the HAA to “afford the fullest possible weight to the interest of, and the approval and provision of, housing.” These considerations weigh in favor of fixing the date on which the application was complete on the date when the City actually made that determination—in 2011—rather than at some later date after the City had twice downzoned the project site to allow for much less housing development.

Save Lafayette was unable to point the court towards statutory or case authority for the proposition that, by failing to comply with the time limits of the PSA, the City loses the power to act on a project application entirely. The court found that the default rule is that unless the Legislature clearly expresses a contrary intent, an agency does not lose jurisdiction to act even after a statutory deadline passes.

The Court of Appeal affirmed the trial court’s judgment. In conclusion, despite the lengthy delay between certification of the EIR and project approval, the city properly applied the general plan standards in effect when the application was deemed complete. The court, therefore, rejected Save Lafayette’s contention that O’Brien lost the benefit under the HAA of having submitted a complete application in 2011, after the City failed to approve the project within 270 days of certifying the EIR. The trial court rightly refused to disturb the City’s approval of the resumed project; its inconsistency with the general plan and zoning standards of June 2018 was immaterial. O’Brien got a complete project application on file in 2011, and the HAA requires that such a project be assessed against 2011 general plan and zoning standards.

Commentary:  An argument could be made that the PSA, taken as a whole, forces a choice on an applicant where the agency does not act promptly on a complete application: either provide public notice under Government Code section 65956 or submit to an application lapsing, thus losing the benefit of the HAA. That is not an impossible reading of the statutory scheme, but neither does the PSA compel this conclusion. Even less does it compel a conclusion that an agency implicitly loses power to act on an application once the statutory time limits pass.