BIA, city discuss potential settlement over density bonus suit

ENCINITAS — The city of Encinitas and the Building Industry Association of San Diego appear to be heading toward a settlement of a lawsuit filed against the city to invalidate the City Council’s attempt in 2014 to close several loopholes that have been popular among developers of so-called “density bonus” projects.

The City Council voted 4-1 on April 22 to begin settlement discussions with the BIA, with Mark Muir voting against the negotiations.

The council and legal representatives met behind closed doors after a special city council meeting Wednesday and emerged with a report that discussions are still ongoing and no action had been taken.

Barbara Kautz, the Bay Area attorney from the firm the city has hired to represent them in the case, confirmed the closed session action and declined further comment.

Details of the potential settlement are not available to the public until the agreement is executed by both parties, City Attorney Glenn Sabine said.

This did not stop two members from the public from urging the council not to settle and stand up for residents, who applauded the City Council’s actions on July 16, 2014, which were intended to stop the practices that they said have led to the proliferation of the oversized, super-dense residential developments citywide.

“All I can do is urge you to stay the course,” said Bill Butler, an Olivenhain resident who spearheaded an effort to stop the development of a density-bonus project called Desert Rose. Residents successfully sued the city and the developer, but the city and developer have appealed the case.

“Maybe we, as citizens, would rather pay for a lawsuit to protect our rights as citizens … than some of the other things you choose to spend money on,” Butler said.

Julie Graboi, who ran unsuccessfully for a seat on the City Council in 2014 and has been a staunch opponent of density bonus projects, urged the council to continue to fight the BIA’s lawsuit.

“Having attended meetings for five years, I can tell you that this was the finest hours I had ever been in these chambers,” Graboi said of the July 16 council meeting.  “There was such a surge of tremendous hope and tremendous support for the council.

“Please find the courage to go back to that meeting where we left with so much hope and support of you because we felt you were supporting us,” Graboi said.

The BIA filed its current lawsuit in October, arguing that the council’s actions, which they say were politically pressured, either violate state law or make it infeasible for developers to build the projects.

“The Encinitas City Council, bowing to the pressure of certain residents fundamentally opposed to the application of the Density Bonus Law in their neighborhoods, has intentionally and knowingly instructed city staff to ‘interpret’ the Density Bonus Law in a manner contrary both to the letter and spirit of the law, and contrary to its longstanding interpretations thereof,” the lawsuit states. “The City Council seeks to render the Density Bonus Law ineffective and unusable in the City…”

The council on July 16 of last year voted on a series of motions that memorialized its intent to stop the practices that they said have led to the proliferation of the oversized, super-dense residential developments citywide. Currently, eight of the 10 projects in the city’s planning queue are density-bonus projects.

The votes on the changes were nearly unanimous, and residents greeted the votes with applause.

State law allows for developers to build extra homes on land to offset the cost of building homes within the development reserved for affordable housing, but residents said the city has taken too liberal of an interpretation of the law, which has allowed developers to build far too many homes than the law intended.

The changes included:

• Rounding down the number of units proposed on a site of the number of allowable units is a fraction

• Building affordable units within the projects to be at least 75 percent of the size of their market-rate counterparts, or 1,500 square feet, whichever is greater

• Requiring developers to provide evidence to demonstrate the need — financial, physical or otherwise — for a waiver of development standards

• Starting the process of adopting a change to the city code that would define “environmental constraints” that developers would not be able to consider as developable space toward its calculation of the project’s density

• Enacting the changes immediately on projects that were not fully vested. Previously, the council policy gave developers those rights at the time they applied for a project.

The BIA argues in its lawsuit that the city’s actions would further damage the city’s ability to provide state-mandated affordable housing allocations. As part of the lawsuit, it is requesting the court order the city to update its housing element, which has not been updated since 1992.

“We are very concerned about the city and its effort to circumvent state law, which allows for the creation of more affordable housing,” BIA Vice President Matt Adams said.

The city and BIA are scheduled to meet in court for an ex parte discussion in front of Judge Robert Dahlquist at 8:30 a.m. May 5, according to the Superior Court register of actions.

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