Housing Accountability Act (HAA) Explained

Photo: Reuben, Junius, & Rose, LLP https://www.reubenlaw.com/sb-167-another-pro-housing-bill-awaits-governors-signature/   

What is the HAA?

The Housing Accountability Act (or the “HAA”) was first passed in 1982, and the legislature has strengthened its provisions over time. Its primary effect is to limit local governments’ ability to disapprove or delay housing development projects for arbitrary reasons: under the HAA, if a housing development project complies with the local zoning code and general plan, the local government may not disapprove it except in very narrow circumstances. The HAA is codified at Government Code section 65589.5.

The HAA is one of the oldest and most important pro-housing laws in California. It ties closely to our work at CalHDF.

What is discretionary review of housing development permit applications?

California municipalities have traditionally used a highly discretionary process for reviewing permit applications for housing developments. This means that even where a proposed development is “allowed” under the zoning designation for the property and all other written rules and regulations, local governments retain discretion to disapprove the development. This discretion meant the outcomes of development applications were unpredictable, and the time and cost required to get to a final decision were very high. In addition to restrictive zoning regulations, this long, unpredictable, discretionary permitting process was and is a major impediment to housing growth in California. Who would invest in property to build new housing if getting permission to build might involve years of process, and no certainty in the final outcome?

The HAA is our main tool in state law to combat this local discretion and make housing permitting easier and more predictable. Through repeated updates by the legislature to strengthen the law, and through our legal advocacy, the HAA has become a very powerful tool to promote housing growth throughout California.

How Does the HAA Limit Local Governments’ Ability to Disapprove Housing Development Projects?

A local government must approve a housing development project that complies with all objective rules in the general plan, zoning ordinance, subdivision ordinance, and design standards. The government must approve the project at the proposed density.

Mixed-use projects qualify for these protections if they dedicate at least two-thirds of their square footage for residential use.

The only exception is if the local government makes written findings that (1) the project will have a specific, adverse impact on public health or safety, and (2) there is no way to mitigate the adverse impact other than by disapproving the project or conditionally approving it at a lower density. These written findings must be based on a preponderance of the evidence in the record. The health or safety impact identified must be significant, quantifiable, and direct, and it must be based on identified written public health or safety standards. This is a very narrow exception, and it is very hard to satisfy.

What If a Project Receives a Density Bonus That Makes It Larger than What Zoning Allows?

Density bonus projects still receive HAA protection. If a housing development project is entitled to a density bonus under the Density Bonus Law (Government Code section 65915), the density bonus does not count as a violation of the local general plan, zoning code, etc. Likewise, if a housing development project is entitled to waivers or concessions of local rules under the Density Bonus Law, those waivers or concessions do not count as violations of the local general plan, zoning code, etc.

Does Affordable Housing Receive Extra Protection under the HAA?

Affordable housing receives further protections. These protections apply to projects that reserve all of their units for sale or rent to households of moderate income, or 20 percent or more of their units for sale or rent to households of lower income. A local government must approve such a project and cannot attach conditions to its approval that make it impossible for the project to provide affordable housing. This is true regardless of the zoning ordinance (although the zoning ordinance may come into play through one of the exceptions to this rule, discussed below).

The only exceptions are the following scenarios. In each, the local government must make written findings that the scenario applies based on a preponderance of the evidence in the record.

    • The site for the project is zoned for agriculture or resource preservation AND one of the following is true: (a) the site is surrounded on two sides by land used for agricultural or resource preservation purposes, or (b) the site does not have adequate water and sewer facilities to serve the project.
    • Some other state or federal law requires the local government to disapprove the project or render it unaffordable.
    • The project will have a specific, adverse impact on public health or safety, and there is no way to mitigate the adverse impact other than by disapproving the project or rendering it unaffordable. The health or safety impact identified must be significant, quantifiable, and direct, and it must be based on identified written public health or safety standards (the local zoning ordinance and general plan do not count).
    • The local government has a compliant housing element, and it has hit the housing production targets (formally known as the regional housing needs allocation, or “RHNA”) in that housing element at all income levels at which the project would provide housing.
    • The local government has a compliant housing element, and the project is inconsistent with BOTH the local zoning ordinance and general plan.
        • Note: this is the only way a local government can reject an affordable housing development project on the grounds that it violates the city’s zoning code or general plan. Thus, if a local government does not have a compliant housing element, its zoning code and general plan are inapplicable to such projects. This is known as the “builder’s remedy.”

What Are the Objective Standards a Housing Development Project Must Comply with to Receive HAA Protection?

To be “objective,” a rule or standard must not involve personal or subjective judgment by a public official. Further, the project applicant must be able to know in advance and with certainty whether their application satisfies the rule or standard.

For example:

  • A height limit of 30 feet is objective: there is no room for personal judgment in deciding whether an application obeys the height limit, and the applicant will know with certainty when they submit their application whether it obeys the height limit.
  • The following rule is not objective: if a project is two or more floors higher than adjacent buildings, the project must include “a transition or step in height” and “step back upper floors to ease the transition.” (This was decided in a case that CalHDF brought under its former name: California Renters Legal Advocacy & Education Fund v. City of San Mateo (2021) 68 Cal.App.5th 820.)

Can the Local Government Change Its Rules after an Application for a Housing Development Project Has Been Submitted?

In short: no, a local government cannot change its rules after a preliminary application has been submitted. A “preliminary application” is an application that includes all of the information listed in Government Code section 65941.1, subdivision (a).

There are some exceptions to this. Most of them are relatively minor. (For example, if a local rule provides for automatic annual adjustments of fees based on inflation, the increased fee may apply to the project.) Developers must, however, submit a complete application (see Government Code section 65941.1, subdivision (d) for details) within 180 days of the preliminary application, or they will lose their protections against subsequently enacted local rules.

How Quickly Must a Local Government Process an Application for a Housing Development Project under the HAA?

The HAA and other laws create a number of deadlines for local governments to process applications for housing development projects.

First, the application must be deemed complete. The Permit Streamlining Act, in Government Code section 65943, gives local governments 30 days after an application is submitted to determine whether the application is complete, or the applicant needs to provide more information. If the local government asks for more information, then once that information is provided, the local government has a further 30 days to determine whether the application is now complete. If the local government still believes the application is incomplete, the applicant has a right to appeal that decision, and they have a right to a final written decision on that appeal within 60 days. If the local government misses any of these deadlines, the application, as a legal matter, is considered to be complete.

After the application is complete, the HAA requires the local government to provide a written list of any points where the proposed housing development project does not comply with the local general plan, zoning code, etc. (Under the HAA, an applicant need only provide “substantial evidence” – a very low burden of proof – that their application complies.) The local government must provide this written list within 30 days if the project includes 150 or fewer dwelling units, and 60 days if the project is larger than 150 dwelling units. If it misses this deadline, the project, as a legal matter, is considered consistent with the local general plan, zoning code, etc., and the HAA’s protections apply.

What If a Local Government Violates the HAA?

If a local government violates the HAA and disapproves a housing development project application, the applicant, a housing organization (e.g. CalHDF), or someone who would have been eligible to live in the project can bring a lawsuit to ensure the project’s approval. The HAA tilts the scales heavily in favor of the person or entity suing the local government.

First, the HAA creates a strong presumption in favor of approving housing projects. The HAA states, in its text, that it should “be interpreted and implemented in a manner to afford the fullest possible weight to the interest of, and the approval and provision of, housing.” This means difficult legal questions around the HAA’s coverage and effect should be resolved in a way that gets more housing built.

Second, in any HAA lawsuit, the burden of proof falls on the local government – not the project applicant. (See Government Code section 65589.6.) Furthermore, a housing development project is judged consistent with the applicable local rules (zoning ordinance, general plan, etc.) as long as the applicant can provide “substantial evidence” that it is consistent.  “Substantial evidence” is a legal term, and in practice it amounts to a very light evidentiary burden: as long as it is reasonable to conclude the project is consistent with the local rules, a court must find it consistent.

Third, local governments that lose an HAA lawsuit face heavy fees and fines. Except in rare circumstances, if a plaintiff wins an HAA lawsuit against a local government, the local government must pay the plaintiff’s attorney’s fees and the other costs incurred in bringing the suit. If a court rules in favor of the plaintiff, furthermore, the local government has 60 days to comply with the HAA, or it will be fined a minimum of $10,000 per dwelling unit in the proposed housing development project. If the local government acts in bad faith, that fine is multiplied by five.

Do Other Laws Limit the HAA?

Yes. Both the California Environmental Quality Act (“CEQA”) and the California Coastal Act apply to housing development projects. CEQA requires that the environmental impacts of all discretionary government projects, including housing permits, are analyzed, disclosed, and in some cases mitigated. While the law is not intended to prevent housing approvals, its requirements can lead to substantial delays in permitting.  The Coastal Act applies only within the coastal zone, and may empower local governments to disapprove or impose conditions on applications for housing development projects that receive HAA protections.

The HAA and Our Work at CalHDF

The HAA is central to CalHDF’s work. We monitor city council and planning commission agendas throughout the state to see when they are voting on HAA-eligible projects. When we spot such a project, we write a letter reminding the council or planning commission of its obligations under the HAA. If the council or planning commission ignores our letter and disapproves the project in violation of the HAA, and we believe the situation warrants our intervention, we bring a lawsuit to ensure the project’s approval.

This is how we won CaRLA v. San Mateo, the lawsuit mentioned above that established a major legal precedent confirming the power of the HAA.