A Northern California city has agreed to plan more low-income housing and pay the state's legal fees to settle a fair housing lawsuit, Gov. Gavin Newsom and other state officials announced Wednesday.
The state sued the city of Elk Grove last year, alleging the city had illegally denied a 67-unit homeless housing development in a historic neighborhood despite having recently approved a similar market-rate development in the same area. Wednesday’s settlement requires the city to identify another site in a high-income community for low-income housing, agree to state reporting and monitoring requirements for compliance with housing laws and pay $150,000 in attorneys’ fees and costs.
The suburban Sacramento community of 178,000 had already reached an agreement with the developer, Excelerate Housing Group, to allow a separate project for low-income people at a different location.
“We cannot solve California’s homeless crisis without creating new housing and supportive services,” Newsom said in a statement. “Elk Grove is not immune to this challenge, and the city’s decision to block these efforts — wasting valuable time and resources — is especially shameful. We expect Elk Grove to comply with the law; continued refusal will not be tolerated.”
Excelerate first proposed the project, Oak Rose Apartments, on a vacant lot in 2021, pursuant to state laws meant to expedite approval of low-income housing in communities that have not met mandated housing production targets. Under pressure from nearby residents, city officials repeatedly rejected the development, saying it was incompatible with the character of the historic area, according to the state’s lawsuit.
The developer sued the city in 2022, and the state followed up with its own litigation last May. The city’s previous agreement with Excelerate called for the developer to abandon Oak Rose Apartments. But it allowed Excelerate to submit an 81-unit low-income project, Coral Blossom Apartments, on a different vacant parcel in the city. The city voted to move forward with Coral Blossom Apartments this summer.
California Attorney General Rob Bonta said that despite that agreement, the state needed to enforce the law against Elk Grove given the depth of the housing crisis in California.
“While I am pleased that this is behind us and that Elk Grove has approved even more housing for those most in need, the city’s refusal to do the right thing time and time again cannot be overlooked,” Bonta said in a statement. “These are not normal times.”
