State Rejects Beverly Hills’ Housing Plan

Beverly Hills lacks an adequate plan to do its part in addressing California’s affordable housing crisis. That was the opinion of a Nov. 28 letter by the state’s Department for Housing and Community Development, or HCD, which for the second time rejected the city of Beverly Hills’ state-mandated housing element. 

Once a sleepy document broadly chronicling a city’s next eight years of housing policy, “A paper-pushing exercise,” said UC Davis Land Use Law Professor Chris Elmendorf, the housing element has become vitally important to Beverly Hills’ near-term future. 

That’s because Beverly Hills is now required under the state’s Regional Housing Needs Assessment to produce 3,104 units of affordable housing between 2021 to 2029, compared to a requirement of just three sites total from 2013 to 2021. 

Also, large-scale developers are eying Beverly Hills and other noncompliant cities as the site of their next residential mega-project. A state law known as the builder’s remedy lets developers build what they wish in these cities if it includes a 20% affordable housing set aside.

The letter from Paul McDougall, senior program manager at HCD, was addressed to Timmi Tway, director of the city’s community development department. Reached on Nov. 29, Tway stated that the city is still analyzing HCD’s comments. “The city has worked diligently over the past several years on the housing element update process and we will continue to do so as we seek certification from the state,” Tway said.

“This analysis will help us better understand the anticipated next steps and timeline for updates to the housing element.”

Critical Letter

The state’s criticisms are pointed.

“The element did not address HCD’s previous finding,” the letter reads, noting that the city did not specify the number of units that go on each land parcel it identified as a candidate for affordable housing.

The state demanded more clarity on what Beverly Hills’ planners call the “mixed-use overlay zone,” a swath of the downtown recently made eligible for residential use.

Potential affordable housing sites, the state noted, are presently home to “viable businesses including medical uses, Class A and B office buildings, and stores including a Starbucks, Neiman Marcus, and CVS.”

The city provided “little to no analysis on the likelihood of these uses discontinuing during the planning period.”

HCD acknowledges that the revised housing element does more to “affirmatively further fair housing.” But the state ultimately slams the city for a lack of specifics.

Many program actions “are limited to conducting research” and “includes language such as ‘study,’ ‘continue’ or ‘maintain’ that does not result in tangible outcomes that will overcome patterns of segregation and foster inclusive communities free from barriers that restrict access to opportunity,” the HCD letter reads.

For other components of the housing element including senior and group housing, the state tersely writes: “The element continues to not address this finding.”

Building Struggle

The letter adds to what is a struggle for Beverly Hills to comply with state housing policies and the objectives of Governor Gavin Newsom’s administration and state legislature.

The 3,104 affordable unit requirement was handed down by the Southern California Association of Governments following a state Regional Housing Needs Assessment study. The city once sought to fight the requirement but acceded and submitted a housing element last October.

That plan was rejected by HCD in a letter this January. Nine months later, after what Tway described as repeated consultations with state officials, the city sent to HCD the revised housing element.

The revised housing element did pass through the Planning Commission and City Council before being sent to Sacramento. But city officials did not question if the housing element was adequate, instead rebuking the state for rejecting the city’s original plan.

“This is a fantastic work product,” said Planning Commissioner Peter Ostroff at an Aug. 25 Planning meeting. “I think it is time for HCD to certify our housing element.”

So long as the housing element is not certified, Beverly Hills will be docked in efforts to receive state housing monies, the HCD letter noted, including the Senate Bill 1 Sustainable Communities grant.

Another consequence: The city may see more developers submit applications for projects like the 16-story, 200-unit apartment tower on Linden Drive proposed by Leo Pustilnikov.

Already, Santa Monica has seen 12 separate project proposals that defy that city’s zoning laws, developments made possible by housing element noncompliance.

Tway has said that the city would process any such project “in accordance with the city’s existing entitlement process and in compliance with state law.”