* Partner, Bingham McCutchen L.L.P.; Co-author, Curtin’s California Land Use and Planning Law (22d ed. 2002); J.D., Harvard Law School, 1988.
** Associate, Bingham McCutchen L.L.P.; J.D., University of California, Berkeley School of Law, 2001; M.S.W., University of California, Los Angeles, 1996.
1 See Little Hoover Comm’n, Rebuilding the Dream: Solving California’s Affordable Housing Crisis 4, 9 (2002). The Little Hoover Commission was directed to explore “how public policies could be reformed to fortify the State’s ability to provide an adequate supply of affordable housing for the growing number of young families, newcomers, seniors and other Californians with low incomes. Id. at i.
2 See id. at 10 (noting that housing costs have risen for the last twenty-five years).
3 See id. at 4–5. The State’s Little Hoover Commission has made clear that providing housing, especially affordable housing, is crucial to the well-being of every Californian and the state as a whole. See id. at 3. In its recent report, the Commission recommended that in order for the private sector to supply an adequate housing stock at all income levels, “local governments must adopt land use plans and regulatory schemes that provide opportunities for housing development and eliminate unnecessary constraints.” Id. at iv.
4 Id. at 3.
5 Id. at 3–4.
6 Id. at 4.
7 See Little Hoover Comm’n, supra note 1, at 3.
8 Id.
9 Id.
10 See Cal. Dep’t of Hous. & Cmty. Dev., Raising the Roof: California Housing Development Projections and Constraints 1997–2020 (2000), http://housing.hcd.ca. gov/hpd/hrc/rtr/int1r.htm (last visited Mar. 31, 2003).
11 See Little Hoover Comm’n, supra note 1, at 4.
12 See id.
13 Id.
14 See id. at 63–67 (listing various government, business, and community members testifying at the Little Hoover Commission’s hearing on the need to ensure an adequate supply of housing).
15 See id. at ii.
16 The reality that Smart Growth principles must include the goal of increasing housing production was emphasized in a recent report by the California Association of Bay Area Governments (ABAG). In October 2002, ABAG issued its Final Report on projected growth in the Bay Area, presenting a comprehensive, region-wide Smart Growth land use vision. Ass’n of Bay Area Gov’ts, Smart Growth Strategy—Regional Livability Footprint Project Final Report: Shaping the Future of the Nine-county Bay Area (2002), http://www.abag.ca.gov/planning/smartgrowth/Final/SmartGrowthRpt_final.pdf (last visited Mar. 31, 2003). The Final Report focuses on three “key goals” of sustainability: a prosperous economy, a quality environment, and social equity. Id. at 3. It identifies the housing shortage as a major impediment to economic growth and advocates more planning for and construction of residential units. See id. at 4.
17 See, e.g., Little Hoover Comm’n, supra note 1, at 20–28 (recommending implementation of an inclusionary housing plan). These programs impose affordable housing requirements on developers, and thus arguably serve as a disincentive to build. Many inclusionary housing programs, however provide benefits to the developer as well, such as density bonuses, expedited processing, fee deferrals, and loans or grants. Moreover, the inclusion of an affordable housing component may make approval of the entire project more politically feasible.
18 In general, an “inclusionary housing program” is one that requires a residential developer to set aside a specified percentage of new units (often ten to fifteen percent) for very low-, low-, or moderate-income households in conjunction with the development of market-rate units. See Laura M. Padilla, Reflections on Inclusionary Housing and a Renewed Look at Its Viability, 23 Hofstra L. Rev. 539, 551–52 (1995). The term “inclusionary housing” or “inclusionary zoning,” however, can include a variety of methods designed to create more affordable housing. See id. Some examples include density bonuses, reduced development standards, and imposition of fees on developers to fund affordable housing projects. See id. at 553.
19 In California, by 2000, at least 108 cities and thirteen counties had adopted various inclusionary housing programs, a majority of which are mandatory. See Nadia I. El Mallakh, Does the Costa-Hawkins Act Prohibit Local Inclusionary Zoning Programs?, 89 Cal. L. Rev. 1847, 1861–62 (2001). Moreover, examples of creative inclusionary housing programs can also be found across the nation, in Colorado, Florida, Maryland, Massachusetts, New Jersey, New Mexico, and Virginia. See D.C. Office of Planning, Inclusionary Zoning, A Primer 7–8 (2002); Innovative Hous. Inst., Inclusionary Zoning Around the Country (2000), http://www.inhousing.org/USA%20Inclusionary/USA%20Inclusion.htm (last visited Mar. 31, 2003); see also Karen Destoral Brown, Expanding Affordable Housing Through Inclusionary Zoning: Lessons From the Washington Metropolitan Area, The Discussion Paper Series (Brookings Inst. Ctr. on Urban & Metro. Policy, Washington, D.C.), Oct. 2001, at 34–35. Finally, the inclusionary housing philosophy is also finding support internationally. See generally, e.g., In re Article 26 of the Constitution & In re Part V of the Planning & Dev. Bill 1999, [2000] 2 I.R. 321 (Ir. S.C.) (Aug. 28, 2000) (unanimously upholding a national twenty percent affordable housing statute, which allows the local agency, as a condition of approval, to require the developer to enter into an agreement whereby it gives up to twenty percent of the land for affordable housing or provides several sites or houses actually built for such purposes).
20 See Padilla, supra note 18, at 551.
21 See id. at 577–78.
22 But see Town of Telluride v. Lot Thirty-Four Venture, L.L.C., 3 P.3d 30, 33, 35–36 (Colo. 2000) (holding that the town’s “affordable housing mitigation” ordinance, which required developers to create affordable housing for forty percent of the employees generated by the new development, as well as setting a base rental rate, constituted “rent control,” thereby violating the State’s anti-rent control statute); Bd. of Supervisors v. DeGroff Enters., 198 S.E.2d 600, 602 (Va. 1973) (holding that a mandatory set-aside provision was invalid under state law as well as an improper socioeconomic regulation).
23 483 U.S. 825, 840–41 (1987).
24 512 U.S. 374, 391 (1994).
25 108 Cal. Rptr. 2d 60, 65–66 (Ct. App. 2001), cert. denied, 535 U.S. 954 (2002); see also San Remo Hotel L.P. v. City of San Francisco, 41 P.3d 87, 106 (Cal. 2002) (declining to extend heightened scrutiny to “housing replacement fees”).
26 198 S.E.2d at 601–02.
27 Id.
28 Id. at 602.
29 336 A.2d 713, 728 (N.J. 1983).
30 The ordinance accomplished this goal by: (1) permitting only single-family detached dwelling units in residentially zoned areas; and (2) requiring significant minimum lot sizes and floor areas. See id. at 719–21.
31 See id. at 730–32.
32 See id. at 724–25.
33 S. Burlington County NAACP v. Township of Mount Laurel, 456 A.2d 390, 410 (N.J. 1983) (stating that “we believe that there is widespread non-compliance with the constitutional mandate of our original opinion . . . . To the best of our ability, we shall not allow it to continue. This court is more firmly committed to the original Mount Laurel doctrine than ever . . . .”).
34 Id. at 443.
35 Id. at 446 n.30.
36 583 A.2d 277, 295 (N.J. 1990). The ordinance at issue “create[d] an affordable housing trust fund and impose[d] a mandatory development fee on all new commercial and residential development as a condition for receiving a certificate of occupancy.” Id. at 281.
37 Id.
38 Id. at 292.
39 941 F.2d 872, 873 (9th Cir. 1991).
40 Id.
41 Id.
42 This case took place before the Dolan decision; therefore, the court did not have to face the question of “how close a fit” is required. See Dolan v. City of Tigard, 512 U.S. 374, 387–88 (1994).
43 Commercial Builders, 941 F.2d at 874.
44 Id. at 874–75.
45 803 A.2d 53, 92 (N.J. 2002).
46 The New Jersey Supreme Court created a “builder’s remedy” as a means of enforcing the affordable housing obligations under Mount Laurel I and Mount Laurel II. This remedy permits builders to seek court approval for construction of a housing project with an affordable housing component, which a township failed to approve. See Oakwood at Madison, Inc. v. Township of Madison, 371 A.2d 1192, 1200 (N.J. 1977).
47 Toll Bros., 803 A.2d at 76.
48 Id. at 92.
49 Home Builders Ass’n of N. Cal. v. City of Napa, 108 Cal. Rptr. 2d 60, 63–64 (Ct. App. 2001), cert. denied, 535 U.S. 954 (2002).
50 See generally Napa, Cal., Mun. Code § 15.94 (1999).
51 See id. § 15.94.050(A). “At least 10% of all new dwelling units in a residential development project shall be affordable units which shall be constructed and completed not later than the related market rate units.” Id.
52 Id. § 15.94.050(B).
53 Id.
54 Id.
55 Id. § 15.94.050(C).
56 Id. § 15.94.050(D).
57 Id. § 15.94.080(A).
58 Home Builders Ass’n of N. Cal. v. City of Napa, 108 Cal. Rptr. 2d 60, 63 (Ct. App. 2001), cert. denied, 535 U.S. 954 (2002).
59 Id. at 61.
60 Id. at 63–67.
61 Id. at 64.
62 Id.
63 Id. The court also rejected HBA’s argument that the waiver provision violated Dolan by improperly placing “the burden on the developer to prove that a waiver would be appropriate when the City ha[d] not established a justification for the exactions mandated by the ordinance.” Id. The court emphasized that the burden shifting under Dolan does not apply when evaluating generally applicable zoning regulations. Id.
64 City of Napa, 108 Cal. Rptr. 2d at 64–65.
65 Id. at 64.
66 Id. at 65.
67 Id.; see also San Remo Hotel L.P. v. City of San Francisco, 41 P.3d 87, 107 (Cal. 2002) (upholding San Francisco’s Residential Hotel Unit Conversion and Demolition Ordinance). The San Remo court found that the housing replacement fees have a reasonable relationship to housing lost by conversion to tourist use, making clear that generally applicable ordinances must be reviewed under the deferential standard rather than the heightened scrutiny standard under Nollan, Dolan, and Ehrlich v. City of Culver City, 911 P.2d 429 (Cal. 1996). San Remo, 41 P.3d at 103, 105–07.
68 City of Napa, 108 Cal. Rptr. 2d at 64.
69 Id. at 65.
70 Id.
71 Id.
72 Id. (quoting Ehrlich, 911 P.2d at 438).
73 Id. (quoting Santa Monica Beach Ltd. v. Superior Court, 968 P.2d 993, 1002 (Cal. 1999) (quoting Ehrlich, 911 P.2d at 444)).
74 City of Napa, 108 Cal. Rptr. 2d at 65.
75 Id.
76 Id.
77 Id.
78 See id.
79 See id.
80 See Thomas Jacobson, Inclusionary Housing Requirements: An Overview, Presentation at the American Planning Association National Conference 2 (Apr. 14–17, 2002)(on file with authors).
81 See generally Inst. for Local Self Gov’t, The California Inclusionary Housing Reader (2003), at www.ilsg.org/inclusionary (providing information regarding inclusionary housing ordinances).