Cupertino Electeds Adopt New Development Rules Despite Warnings From Housing Officials

In a disastrous attempt to mitigate its “bad reputation” towards affordable housing production, Cupertino elected officials attempted to skirt state laws in favor of its own legislation—potentially opening itself up to legal action in the process.

Cupertino council members voted Tuesday to adopt new rules to grant flexibility to developers willing to build affordable housing in the city. While the new ordinance is more generous to developers than the city’s previous regulations, it is still less accommodating than standards outlined in new legislation that became state law in January.

The discrepancy didn’t go unnoticed by the California Department of Housing and Community Development (HCD), which sent a letter Monday warning city officials that approving the change to the city’s zoning code would likely get them into trouble. But elected leaders seemed unaware of that correspondence Tuesday as they spent 20 minutes discussing the change and leaning on legal advice that, it seems, got them firmly back on the state’s list of housing offenders.

Mayor Darcy Paul, who did not appear to know about the HCD letter Tuesday, vehemently rejected the possibility that the city would not have control of development within its boundaries as he pushed the new ordinance forward. He said developers that want more flexibility can simply ask the city to approve an exception for their project.

“We’re not in a dictatorship, we’re not in an autocracy, we are in a system of federalism; there are states with state rights and localities have locality rights,” Paul said. “If we are demonstrably making these efforts better [to solve the housing crisis], then I'm very proud to support the legislation that we have.”

The lone “no” vote came from Council Member Hung Wei, who said she was nervous about running afoul of the state law.

State Rules

Assembly Bill 2345, authored by Assemblywoman Lorena Gonzalez, created a statewide baseline for the rules that would grant developers more flexibility on things like height and parking if a project includes affordable housing—particularly in regions that aren’t keeping up with demand. That includes Cupertino, which as of last year, boasted an affordable housing inventory that made up 1.9% of its overall housing stock.

The state bill mandates new incentives, concessions and waivers for developers to bypass rules that may drive up costs and ultimately prevent construction. It offers flexibility on height limits, retail restrictions and costly parking requirements.

Without those kinds of design and ordinance exceptions, adding flexibility on density—or the number of units that can rise on a plot of land—could create more financial roadblocks for projects, according to the HCD and other housing studies. While a city can make its own development ordinance, the local rules can’t be more restrictive than the state’s.

Despite several letters and public comments urging Cupertino not to move forward, the council brushed off compliance concerns, citing a lack of lawsuits on the issue elsewhere in the state and advice from housing attorney and outside legal counsel Barbara Kautz, of Goldfarb & Lipman.

Kautz assured the council their approach was different than those in the city of Encinitas, which received letters from the California Department of Housing and Community Development for technical assistance in December, followed by a notice of violation in March.

Either Kautz wasn’t aware, or failed to inform the council, Tuesday that the city of Encinitas—which is also her client—repealed the ordinances April 9.

Despite the legal advice, Wei urged fellow council members to wait to adopt the new ordinance to see if the HCD would send a warning, as it had in Encinitas.

“By doing this, are we going to receive that letter and get on the state's radar again saying that Cupertino is doing something different and not conforming?” Wei asked. “We don’t have a good reputation already, and I just feel that we don’t want to exacerbate that.”

Lost Letter

Wei’s concerns were on the nose. According to documents obtained by San Jose Inside, HCD sent a letter to Cupertino City Manager Deborah Feng via email at about 4pm Monday—a fact not disclosed during Tuesday’s discussion or meeting documents.

It’s unclear why the council wasn’t aware of the correspondence. Feng did not respond to a request for comment.

In the letter, Shannan West, HCD land use and planning unit chief, confirmed the city’s ordinance did not qualify for an exemption from state law, since it failed to provide additional mechanisms to incentivize development, meaning it was not superior to the state’s standards.

“Over time, the legislature has realized that substantial enticements beyond density bonus units are needed to incentivize the development of affordable housing,” West wrote in the letter, calling incentives and concessions, waivers, and reduced parking standards “essential” to the effort. “It is generally recognized that these ‘other tools are even more helpful to project economics than the density bonus itself.’”

Reached for comment Wednesday evening, Wei said she felt betrayed if city staff purposefully kept the letter from councilors.

“These are all material facts that we need to know before we vote for anything,” Wei said, adding she also wasn’t told about Encinitas’ repeals. “I mean, I voted no, but the other council members should feel betrayed.”

Paul did not respond to requests for comment.

Opponents of Cupertino’s legislation saw the vote as a cynical attempt to get away with approving fewer developments with density bonuses.

JR Fruen, a native Cupertino resident and co-founder of the pro-growth community advocacy group Cupertino for All, insisted to city leaders that increasing requirements for affordable housing units while not allowing flexibility in the other development factors that help minimize building costs is effectively a tax and will not live up to legal requirements.

“In my mind, this is just an effort on the part of Cupertino to sort of ‘woke wash’ what it's doing,” Fruen said the weekend before the vote. “It’s trying to say that they're further incentivizing affordable housing, while at the same time, overall reducing the amount of housing that would be built. That’s fundamentally their aim.”

18 Comments

  1. Good for Cupertino!

    “Opponents of Cupertino’s legislation saw the vote as a cynical attempt to get away with approving fewer developments with density bonuses.” Boohoo to the socialist crybabies.

    San Jose should cease being the dumping ground for the Bay Area’s rejects.

    If you can’t afford to live in Cupertino or the Bay Area for that matter, move along.

    It is not my fault people cannot afford to live here.

    I can’t afford to live in Beverly Hills and I’m not crying about it.

    David S. Wall

  2. “Electeds,” for at least the second time in this publication recently? [sigh]

    Why the emphasis, or selection, anyway?

    “elected leaders seemed unaware”

    Defying or not even paying attention to law is nothing new for California liberals, liberal politicians or liberal tech companies.

    BUT:

    Maybe Cupertino wants to test state law, which wants to impose degradation.

    berkeleysideDHOTTorgSLASH2021/04/09/berkeley-adu-harper-street-state-law

    (If they’re more competent than most in today’s California, admittedly a stretch)

  3. Cupertino Mayor Darcy Paul is correct. We do not live in an autocracy. But overreach from the State Legislature in the area of control of local land use has become so common that it’s easy to miss the nuanced federalism amid the distraction of so many authoritarian acts.

    Cupertino has long recognized that the housing it needs is housing that people of modest means can afford. Cupertino also needs parks on its east side where residents are already crammed cheek by jowl. It needs water, transit and transportation infrastructure, and more funding for its public schools.

    What Cupertino does not need is to subsidize bloated, extractive, office/market-rate housing developments imagined by an oligarch class determined to use real estate to hide from taxes the wealth it has amassed.

  4. @ David Wall: Astonishing that you call the move towards liberalizing the housing economy “socialism”.

    Zoning is much closer to central planning than anything else in contemporary America. The city of Cupertino literally centrally plans what kind of housing can be built where. The state is attempting to liberalize zoning, and thereby make housing more responsive to the market, which is the exact opposite of socialism.

    The state should overrule Cupertino’s planning mafia, and allow developers to sue the city into oblivion, because the city is in violation of state law.

  5. SAM,

    The HCD, in the letter written did NOT have prior knowledge of the pollution as you claimed during building. It may have been discoveres say in 2016.

    So your comment is not an accurate one by any means, it idid however probably lead to a lot of health problems for workers in the mall. And perhaps a “cluster” of illnesses should have been uncovered years ago by public health.

    In any event this letter from an Lawyer did not prove what you said in any way.

  6. Steven,

    That stupid council approved the project in 2018. You’re saying Vallco was known to be a hazardous waste back in 2016? It had to be way earlier than that. HCD let those idiots approve it and it’s sure looks like city council sat on the information when they got it.

    “Vallco updated the SCR twice, in June 2019 and August 2019, correcting prior mischaracterizations that no PCBs were detected above screening levels. Furthermore, additional testing samples in 2020 revealed more PCB contamination at the Project Site.”

    How come the city council hid that it was a toxic dump? What is mischaracterization but a fancy word for lying? Lying about toxic waste? Lousy city council and lousy HCD letting this crap go on. Seems the developer is in with all of them, they don’t care about nobody at all.

    https://www.cupertino.org/home/showpublisheddocument/29257/637550300276670000

  7. SAM,

    YOU said it was a known hazardous site, not me. Your own letter indicated ONLY that as of 2016 there was any indoication of there being pollution there. You are trying to purposley confuse the readers here.

    You have no evidence of anyone SITTING on the information, you are just making allegations with no evidence. Especially given that perhaps the current project required REMOVAL of the pollutted soil exposed and a pollutant mitigation process, or have you even looked at the plan to see that it was.

    In the end you gave the impression that Cupertino had more knowledge that the site was conamtniated with PCPs BEFORE 2016, and you are giving the impression that the CURRET project took that problem into account to provide a contorlled and monitored site.

    I guess that is what your intent is, to be a source of misinformation. Please provide us with any reports that indicate the CONTINUING problems with PCPs in the area? I think you are an employee of the law firm Aleshire & Wynder that wrote the letter you link to.

  8. Other local laws and ordinances stricter than the state’s have been upheld several times so it seems the author of this article has gotten some bad legal information or doesn’t keep up to date on these issues.

    But this is what happens when you give up local control and let Sacramento morons run your local communities from their ivory towers of corruption.

  9. Sewbastian,

    You conflating a lot here.

    First localities (Cities or Charter Cities) are required to uphold state laws and regulations. That is a Constitutional FACT. Because if anything else the code of conduct and oath of office requires local governments to uphold state and federal laws. Granted localities have the power to grant more rules upon their own jurisdiction, and yes there is some competition regarding localities can do to attract people or business.

    BUT.

    There is NO GIVE UP on LOCAL CONTROL. The state makes laws and regulations that must be EQUALLY applied to ALL Localities because the STATE constitution Article 1 Section 7and the FEDERAL constitution 14th Amendment requirements.

    In reality there has NEVER BEEN LOCAL CONTROL. What is happened is that many like yourself promoted a MYTH that it existed. As long as no SINGLE locality is targeted for any different treatment, there is no such thing as what you are describing.

  10. If it weren’t for the toxic NIMBYism of Cupertino and like white, suburban citadels of lawns and fear, the state wouldn’t have needed to pass legislation aimed at forcing such places to build their share of housing, both to help meet projected demands of the future, and the affordability demands of the present.
    The other choice is to build further on to Agricultural and forested land in California, and try to hire teachers and firefighters willing to commute two hours because they can’t find housing in Cupertino, Palo Alto, or Marin County.

  11. Goldstein; do you know the difference between charter cities and cities? Charter cities can pass statutes that supercede State law when within the bounds of their Charter. Therefore, it is NOT a Constitutional FACT that State Law always trump municipal codes. The concept of the Supremacy Clause of the US Constitution for States vs Feds is not analogues to charter cities vs. State statutes. The Charter must be reviewed for applicable delegation of State Sovereignty to the chartered city to shed light into which statute (municipal or State) governs.

    You are doomed….to a life of misrepresentations, omissions, fabrications, and ultimately gross under-comprehension of most topics you post about.

  12. TRY LOGIC you wrote:

    “Goldstein; do you know the difference between charter cities and cities? Charter cities can pass statutes that supercede State law when within the bounds of their Charter. Therefore, it is NOT a Constitutional FACT that State Law always trump municipal codes. The concept of the Supremacy Clause of the US Constitution for States vs Feds is not analogues to charter cities vs. State statutes. The Charter must be reviewed for applicable delegation of State Sovereignty to the chartered city to shed light into which statute (municipal or State) governs.”

    BUT, YOU SACRIFICE ANY FEDERAL OR STATE FUNDS, OR ANY GRANTS OF ANY KIND IF YOU ENFORCE THAT IDEA.

    THE CHARTER CITY IS NOT ENTITLED TO ANY STATE OR FEDERAL FUNDS IF IT ACTS AGAINST BOTH STATE AND FEDERAL LAWS OR CONSTITUTIONS EQUAL ENFORCEMENT AND PROTECTION CLAUSES.

    I would like to see ANY charter city try to go without them.

    You are not making any sense here. I can only imagine how fast a Charter City will declare bankruptcy if they take your suggestion. Or they cut services so much that no one will live in them.

  13. Steven Goldstein: So for once you can’t deny that you were in fact wrong. You merely assert that the consequences of certain actions are not worth the benefit of taking said action. That is a completely different argument and part of your standard operating practice of avoiding any admittance of error.

    Then you continue to assert there is a violation of law simply by operating under the authority enshrined in a City’s Charter. This is factually incorrect. The Charter is a delegation of State sovereignty to a small extent that effective excepts the City from having to comport with certain State laws. This is no different than a Statute providing exceptions–which happens all the time.

    Chartered City’s can not ignore Federal laws any more than State’s can because State Sovereignty (power) cannot be delegated if it doesn’t exist in the first place. Therefore the Supremacy clause clips the power the the State and therefore the power of the State to delegate.

    The rest of your word salad lack cohesion. I don’t know what law school you went to, but I went to Santa Clara Law School and you understanding of Constitutional issues is on full display here.

    You Sir are doomed.

  14. Try Logic you wrote:

    “Steven Goldstein: So for once you can’t deny that you were in fact wrong. You merely assert that the consequences of certain actions are not worth the benefit of taking said action. That is a completely different argument and part of your standard operating practice of avoiding any admittance of error.”

    You haven’t proven any error YET, you wrote:

    “Then you continue to assert there is a violation of law simply by operating under the authority enshrined in a City’s Charter. This is factually incorrect. The Charter is a delegation of State sovereignty to a small extent that effective excepts the City from having to comport with certain State laws. This is no different than a Statute providing exceptions–which happens all the time.”

    WELL is the Charter City is its own SOVERIGNTY, then it is not a part of the State of California, right? That is what you just said. In fact, that has been the flaw in the Charter City system. Once you invoke Sovereignty, you in effect Secede from the State of CA and also the U.S. You really think that by claiming your sovereignty that it means you override the State of CA or the U.S.? That is just foolish. You wrote:

    “Chartered City’s can not ignore Federal laws any more than State’s can because State Sovereignty (power) cannot be delegated if it doesn’t exist in the first place. Therefore the Supremacy clause clips the power the the State and therefore the power of the State to delegate.”

    But that is what you are arguing, that the Charter Cities CAN violate both State and Federal Laws due to sovereignty. You are writing in circles here. You just made it clear that no Charter City can be delegated more power regarding the cities ability to ignore STATE and FEDERAL laws. But you were arguing that they can and should. You wrote:

    “The rest of your word salad lack cohesion. I don’t know what law school you went to, but I went to Santa Clara Law School and you understanding of Constitutional issues is on full display here.”

    Actually your constant rewriting of your arguments which contradict themselves is the best case of “word salad”. The bottom line is your argument is so flawed it is beyond belief.

  15. Try Logic,

    Just understand that if the state laws entitle its citizens rights, and a Charter City tries to deny the equal access to those rights, that is again both a State and Federal Equal Protection violation. And as you said the SUPREMECY CLAUSE of the U.S. Constitution would DEMAND that the STATE EQUAL PROTECTION provision would deem such Charter City action as Unconstitutional. it is just that simple.

    Finally you said this:

    “The rest of your word salad lack cohesion. I don’t know what law school you went to, but I went to Santa Clara Law School and you understanding of Constitutional issues is on full display here.”

    However there is NO WAY TO AUTHENTICATE that claim given that you POST ANONYMOUSLY. Like we are going to take your word for the fact you claim to be an EXPERT in constitutional law? Either Self-Identify so we can see your academic record or better yet do you have a BAR id to validate you are even licensed to practice law?

    People here KNOW I am not a false person. THey KNOW I have significant legal experience in successful state and federal court cases, arguing only on my own. To me you are not “AUTHENTIC” enough to be trusted until you are indeed AUTHENTICATED.

  16. TRy Logic,

    Also according to the news articl here (https://www.sanjoseinside.com/the-fly/cupertino-city-manager-reviewed-after-housing-vote-blunder/)

    The City Manager FAILED to forward the motification of the lack of compliance with state laws, this report stated:

    “At 4pm May 3, the State of California’s Housing and Community Development Department emailed Feng saying the city’s new ordinance to allow more affordable housing in Cupertino should not be approved, as it was inferior to existing state law. As first reported by San Jose Inside, the law would have let affordable housing projects be bigger, but it failed to also create a bypass option for costly rules, like height limits, retail restrictions and parking requirements, which can prevent construction.

    Opening and responding to emails like the one sent by the HCD is expressly required as part of Feng’s $239,000 base salary duties.

    Despite the letter arriving in Feng’s inbox more than 24 hours before the decision, elected officials were seemingly unaware of the state’s advice not to adopt the housing ordinance, so they passed it with little fanfare last week.

    Feng apologized to the City Council and met with HCD reps Monday.

    “The fact that I had not reviewed or forwarded the letter from HCD prior to the City Council meeting was a complete oversight on my part,” Feng said in a statement. “The City Council should have had this information to consider prior to making their decision and I deeply regret this mistake.”

    Other cities have remedied similar legal concerns by repealing inferior ordinances, and not everyone in City Hall thinks the mistake is grounds for Feng’s termination, which would come with a $60,000 severance.”

    It really looks like Cupertino is now FULLY AWARE they are gonig to have to recind the vote they made regarding this ordinance.

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