The housing element identified city-owned properties that could be used for housing, including atop a Metro construction site at Wilshire/La Cienega. (photo by Tabor Brewster)

The Beverly Hills City Council voted to adopt the latest version of the city’s housing element in a meeting on March 18. Additionally, in a letter received by the city on March 18, the California Department of Housing and Community Development indicated that the newest housing element meets all of the state’s criteria, and will be formally approved by the department after being adopted by the City Council. The adoption will put an end to a three-year struggle for Beverly Hills to get its housing element certified by the state.

“It’s been a long haul,” Vice Mayor Lester Friedman said. “I think we’ve answered some of the unrealistic demands of HCD. But we did answer them and I’m certainly supportive of submitting this.”

The housing element is a state requirement of each city in California to zone for low- and medium-income units during each eight-year cycle of growth as part of each city’s general plan. Over the past three years, Beverly Hills has had its version of the housing element rejected by the state several times. In a Dec. 15, 2023, letter rejecting the housing element, HCD cited a lack of compliance with certain requirements, such as promoting fair housing, identifying specific locations in which affordable housing can be built, removing developmental constraints on affordable housing and preventing low-income housing from becoming more expensive.

However, according to the March 18 letter from HCD signed by senior program manager Paul McDougall, the requirements have now been met.

“HCD is pleased to find the revised draft housing element meets the statutory requirements described in its Dec. 15, 2023, review,” the letter read. “The housing element will substantially comply with State Housing Element Law when it is adopted, submitted to and approved by HCD, in accordance with Government Code section 65585.”

City Planner Masa Alkire said the city staff has been meeting with the HCD on an “almost weekly” basis throughout the past few months to create solutions to these issues.

“After intensive work between city staff and the California Department of Housing and Community Development, we are pleased our revised housing element has met the statutory requirements outlined by HCD,” Alkire said in an email. “Now that the City Council has adopted the revised housing element we are proceeding with the next step of submitting the adopted housing element to the state to obtain their formal certification.”

Senior Planner Chloe Chen laid out some of the specific housing element revisions during the March 18 City Council meeting. She said the city has provided three city-owned or city-controlled locations for affordable housing projects. The project locations are the Credit Union Site at 9268-9298 W Third St., the Gale Yard Sites at 8401-8423 Wilshire Blvd. and the Reeve Metro Site at 9430 Wilshire Blvd.

According to HCD, Beverly Hills is required to expand affordable housing in all areas of the city, including “racially concentrated areas of affluence.” According to HCD, RCAA are neighborhoods where over 80% of the population is white and the median household income is over $125,000. Under the definition, the area in Beverly Hills north of Santa Monica Boulevard. would constitute a RCAA. Chen said that to address the RCAA requirements, the housing element includes expanded ancillary living quarters and accessory dwelling unit guidelines.

The housing element approval comes after the city faced legal consequences for its failure to meet housing element requirements. In January 2023, the city was sued by a housing advocacy group, Californians for Homeownership, for its failure to provide affordable housing. In December 2023, a Los Angeles County Superior Court judge ruled in favor of the group.

Though the updated housing element meets HCD requirements, Californians for Homeownership Counsel Matt Gelfand said the updated housing element still does not meet state law requirements.

“The city of Beverly Hills remains out of compliance with state housing element law and the judgment entered against it,” Gelfand said on March 19. “As HCD’s recent letter to the city make clear, HCD’s findings regarding the city’s revised draft housing element do not absolve the city of its separate obligation to comply with the court’s judgment.  The revised housing element is missing several key requirements identified by the court, including the need to provide evidence to demonstrate that the thriving commercial and institutional uses on the city’s housing element sites are likely to be discontinued by 2029.”

Additionally, the failure to meet state requirements opened an opportunity known as the builder’s remedy, which allows private developers to bypass certain restrictions like building height, density and design as long as the developments contain a certain number of affordable housing units. Even after the housing element is approved, the city must consider builder’s remedy projects under state law. The city has not approved any builder’s remedy proposals thus far, and now faces a threat of litigation from one developer – Leo Pustilnikov – who has submitted six builder’s remedy projects.

The city rejected one of Pustilnikov’s proposals for a 19-story mixed use building at 125-129 S. Linden Drive in October 2023, citing the submission as incomplete in a letter to the developer. Pustilnikov has appealed the city’s decision and on April 16, the City Council will hold a public hearing on the appeal.