Elk Grove’s rejection of affordable housing project violated California law, officials say
State housing officials say Elk Grove broke state law, employed double standards and failed to fulfill its own goals of promoting and providing affordable housing stock when it rejected plans for low-income apartments in the city’s Old Town in July.
The 11-page state Department of Housing and Community Development report Wednesday dovetails with a lawsuit also filed the same day by developers of Oak Rose Apartments. In the lawsuit, Oak Rose LP alleged Elk Grove ignored state housing law designed to fast-track affordable housing by not allowing the 67-unit building to go forward.
The proposed three-story apartment building on 1.23 acres on Elk Grove Boulevard near Waterman Road in east Elk Grove would provide permanent housing and services for low-income families who had been homeless.
Now the state’s findings, largely in lockstep with the lawsuit, potentially revive the city-rejected project — and invite scrutiny over Elk Grove leaders’ response to the twin crises of affordable housing and homelessness in the city.
“The city’s response should include, at a minimum, a specific plan for corrective action, including allowing the project to move forward at 9252 Elk Grove Blvd.,” David Zisser, a state housing assistant deputy director, said in the report.
Elk Grove officials on Thursday said city attorneys were “reviewing and evaluating” state housing officials’ findings. The city has 30 days to respond in writing to the report.
Potential penalties are stiff: referral to the state Attorney General’s Office, which can sue the city for violations of state housing law; fines from $10,000 a month to $100,000 a month; or stripping of land use authority with those powers going to a court-appointed agent.
Developers say Oak Rose would be the first permanent housing project in Elk Grove for the homeless.
“We followed all the applicable laws and regulations in designing the project,” Dana Trujillo, CEO of affordable housing developer Excelerate Housing Group said Wednesday in a statement announcing the suit. “At this point, we have no choice but to ask for the court’s assistance to get this project the green light that it legally deserves.”
On Thursday, Trujillo said she hoped the state report will allow the developers’ lawsuit to be resolved more quickly, while voicing concern over potential court appeals that could slow the proposed project.
The prospect of potential delays are “morally horrible to me,” Trujillo said. “People will continue to be without permanent housing.”
Among the report’s findings, state housing officials determined Elk Grove:
Discriminated against the Oak Rose project: Elk Grove broke the law “by allowing ground floor residential uses in a market-rate project while denying the same request to a project providing 100 percent of the units affordable to lower-income households,” the report read.
The market-value Elk Grove Railroad Courtyards project blocks away on Railroad Street, also in Old Town, was approved by city planners in May though its plans included similar ground floor units rejected in the Oak Rose blueprint.
State officials were pointed in their findings on the Courtyards development, part of an ongoing revival of Old Town, anchored in the last two years by the opening of a Dust Bowl Brewing taproom and restaurant and the city’s Old Town Plaza on Railroad and Elk Grove Boulevard.
“Such a double standard is particularly notable” the report noted, saying Elk Grove met 195% of its above moderate income housing needs; but little more than 7% of its very low and low-income housing needs in its previous planning period.
The numbers are even lower in the current planning period. The report notes Elk Grove has met less than 1% of its very low income housing needs and just more than 5% of low income needs.
Elk Grove City Council’s rejected Oak Rose LP’s appeal in July. Leaders levied the decision under the backdrop of Elk Grove’s recent ordinance clamping down on homeless encampments; the city’s ongoing affordable housing crisis; and its acknowledged need for more services to address growing homelessness and housing insecurity.
Sacramento-area housing advocates panned the decision as a missed opportunity to close the housing gap and provide more permanent housing for the city’s homeless. Advocates said Elk Grove officials bowed to NIMBY-ism.
“Elk Grove has to do better,” said Kendra Lewis, Sacramento Housing Alliance executive director, in July. “The city of Elk Grove had the opportunity to take 67 people off the street and that project was killed not because it did not have enough funding or there were structural or design problems. It was because people didn’t want it.”
Failed to promptly tell Oak Rose developers that its plans for the 1.23-acre project did not comply with Old Town zoning standards: Project papers were submitted in March, but were not answered by city officials for months, according to the report. Elk Grove officials didn’t notify Oak Rose developers that their plans for ground floor apartments did not comply with Old Town zoning requirements until June, 90 days later and well past the 30-day notification requirement.
Violated its obligations to “affirmatively further fair housing”: California cities are bound by law to lift barriers to fair housing. Oak Rose’s Old Town site is within a state-designated High Resource Opportunity Area — neighborhoods identified as able to “support positive economic, educational and health outcomes for low-income families, particularly children.”
The Oak Rose site is close to a Bel Air supermarket, shopping on Waterman Road and a transit line and planned city library branch at Waterman and Elk Grove Boulevard.
Denying the project doesn’t square with the city’s fair housing obligations, the report stated, and fails to meet city goals of providing “mobility opportunities” for low-income and special needs households.
Council members who denied Oak Rose’s appeal in July urged developers to work with the city to seek out alternate sites.
“Please consider the alternatives. There are better places (for the project) to be,” Elk Grove city councilman Kevin Spease said at the July council meeting.
But suggesting an alternative site isn’t enough to meet the city’s housing obligations, say state housing officials.
In a lengthy statement posted Thursday to its social media accounts, Elk Grove officials defended the city’s track record on providing affordable housing and in addressing homelessness. Anywhere from 150 to 300 people are estimated to live unhoused in Elk Grove, say city staffers and homeless advocates.
Elk Grove has approved the development of 1,016 affordable housing units since January 2021, officials said, including a second phase of The Gardens at Quail Run complex on Bruceville Road south of Elk Grove Boulevard; the 387-unit Poppy Grove apartments; and the 84-unit Cornerstone transitional housing complex planned for Bruceville Road near Laguna Boulevard and approved by city planners in June.
That project, proposed by an Elk Grove church and affordable housing developers, will have a mix of apartments for working families, adults with intellectual and developmental disabilities and tenants transitioning out of homelessness.
Construction of nearly 700 units is expected to begin in the coming months with more than 300 units in the development and financing stage, said City Manager Jason Behrmann.
“Our residents care deeply for their community and for their neighbors,” said Elk Grove Mayor Bobbie Singh-Allen, who made affordable housing a chief goal of her inaugural term and a campaign pillar in her bid for a second one. “We know that every city must do its fair share to address the state housing crisis and we remain committed to supporting balanced solutions that engage the community and encourage a dialogue that includes all voices and perspectives.”
City officials in the statement also criticized affordable housing legislation as taking control away from city and other local decision-makers. City officials said the measures discourage collaboration among developers, neighborhoods and governments in exchange for “a more costly, time consuming and adversarial process.”
City Manager Jason Behrmann said Elk Grove “is committed to providing housing options for everyone.”
“We strive to collaborate with Elk Grove residents, non-profit partners, and the development community to balance the rights of the unhoused with those of the rest of the community,” Behrmann said in the statement
On Thursday, Trujillo commented on the report’s timing and what it holds for Oak Rose and other affordable housing projects in Elk Grove.
“The city violated state law. As a housing advocate, beyond the need for approval of the project, the city of Elk Grove needs to be proactive to make it easier” for projects like Oak Rose to come to fruition, she said. “It’s the only way to solve this crisis.”
This story was originally published October 14, 2022 at 6:57 AM.
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