TO: LINDA REICH, CITY MANAGER
FROM: FRED GALANTE, CITY ATTORNEY
SUBJECT
title
New Commune DTLA LLC v. City of Redondo Beach Appeal.
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RECOMMENDATION
recommendation
That the City Council authorize participation in the appeal of the Court of Appeal’s New Commune DTLA LLC v. City of Redondo Beach decision to the Supreme Court as amicus curiae (often referred to as a “friend of the court” brief supporting the position of one of the parties) to advocate for clarity and flexibility in the application of Government Code § 65583.2 to overlay zoning strategies.
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FISCAL IMPACT
The actual amount of legal fees to be incurred in crafting the amicus brief will depend on the number of California municipalities that agree to join the brief.
CITY OF CHINO MISSION / VISION / VALUES / STRATEGIC ISSUES
The recommendation detailed above further the City’s values and strategic issues that serve as key pillars on which identified priorities, goals, and action plans are built, by fostering:
• Responsible Long-Range Planning
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BACKGROUND
On October 10, 2025, the California Court of Appeal, Second Appellate District, issued its opinion in New Commune DTLA LLC v. City of Redondo Beach, reversing the trial court’s denial of a petition for writ of mandate under Code of Civil Procedure section 1085 filed by New Commune DTLA LLC (“New Commune”). New Commune sought to invalidate the City of Redondo Beach’s 2021-2029 Housing Element, which the City adopted in October 2021 to comply with the California housing element Law (Gov. Code, §§ 65580-65589.11).
New Commune asserted that the City’s housing element was deficient because it relied on a residential overlay allowing multifamily housing on parcels zoned for commercial and industrial uses violated Government Code §65583.2, subdivision (h)(2). Specifically, New Commune argued that since the underlying zoning still permitted exclusively commercial or industrial projects with no residential component, the overlay failed to meet the statute’s minimum density and residential-use requirements. New Commune also argued the City failed to identify sites that could realistically accommodate low-income housing as required by Government Code § 65582, subdivision (l).
Chino and its consultants have relied on the adoption of residential and mixed-use overlay zones to demonstrate compliance with the Housing Element Law, as authorized by the California Department of Housing and Community Development (“HCD”) guidelines and approval of Chino’s Housing Element. Indeed, over 250 jurisdictions in California similarly approved overlay zoning to satisfy Regional Housing Needs Allocation (RHNA) obligations.
For the 2021-2029 sixth-cycle RHNA period, Redondo Beach was required to plan for 2,490 units, including 936 very-low-, 508 low-, 490 moderate-income-, and 556 above-moderate-income units by the October 15, 2021 deadline. That city submitted its draft housing element to HCD in July 2021, revised it multiple times in response to HCD findings, and ultimately adopted a third amended housing element in July 2022. As a strategy to meet its RHNA obligations, Redondo Beach created a “residential overlay” that permitted up to 55 units per acre on six commercial and industrial zones, accounting for approximately 1,470 units. A private property owner could still elect to construct a project that did not include residential uses based on the underlying zoning. In September 2022, HCD deemed the Redondo Beaches’ Housing Element substantially compliant and certified its Housing Element.
In June 2022, before the Redondo Beach City Council adopted its housing element, New Commune filed a petition for writ of mandate and complaint for declaratory relief. The trial court denied the petition and entered judgment for the City on February 9, 2024, from which New Commune timely appealed. The Second Appellate District reversed the trial court judgment and issued an opinion, which has significant implication for housing elements relying on overlay zoning. In short, the court concluded that Redondo Beach’s residential overlay violated the Housing Element Law for two independent reasons but did not decertify the Redondo Beach Housing Element (instead, it remanded it back to the lower court).
The court agreed with petitioners New Commune and held that “[a]n overlay cannot be used to satisfy the minimum density and residential use requirements set out in section 65583.2, subdivision (h)(2) . . . where the base zoning expressly permits development that does not include housing.” The court’s analysis of Section 65583.2(h) endorsed the reasoning of the Fifth Appellate District’s decision in Clovis v. California Department of Housing and Community Development (2023) 90 Cal.App.5th 240. As in Clovis, the court held that Section 65583.2(h) imposes a mandatory minimum density requirement for sites identified to accommodate a jurisdiction’s lower-income housing needs. In reaffirming Clovis, the court emphasized the plain meaning of “minimum” as a non-negotiable floor below which residential density capacity cannot fall. The court rejected Redondo Beach’s argument that an overlay zone satisfies this obligation by permitting development of 20 units per acre. The court held that the 20 units per acre was the minimum residential density that is required.
Since the Redondo Beach underlying commercial and industrial zones allowed projects with zero residential units, the court held that the overlay failed to ensure that the designated sites were actually available for residential development at the required minimum density of 20 units per acre. The court emphasized that compliance with the statute requires more than nominal eligibility for housing; it requires zoning that mandates residential capacity sufficient to meet RHNA obligations.
The court further reasoned that the legislative history of Assembly Bills 1397 (2017) and 1690 (2014) confirms this reading, as both measures were intended to prevent local jurisdictions from identifying sites that were only theoretically capable of accommodating affordable housing. Accordingly, the decision solidifies Clovis as controlling authority and forecloses reliance on overlay zones that fail to meet the minimum density requirements outlined in section 65583.2(h).
The court found the Redondo Beach overlay zoning violated Section 65583.2(h)(2)’s mandate that requires at least 50 percent of lower-income housing sites be “designated for residential use and for which nonresidential uses or mixed uses are not permitted.” The court reasoned that since Redondo Beach’s overlay preserved the underlying commercial and industrial entitlements, it failed to function as a true residential designation.
The court rejected reliance on the “mixed-use exception” in Section 65583.2(h)(2), finding it inapplicable because the Redondo Beach overlay zones did not require that residential uses occupy at least 50 percent of the total floor area or allow 100 percent residential development. The court emphasized that this exception is a narrow one, designed only for circumstances where the mixed-use zoning itself guarantees a substantial and enforceable residential component. In contrast, the court found that Redondo Beach’s overlay preserved full commercial and industrial entitlements, rendering it inconsistent with the statutory scheme. However, the court did note that the “mixed-use” exception could apply in future cases where the underlying local zoning would meet the statute’s minimum residential requirements.
Under Government Code § 65583, subdivision (a)(3), a city’s housing element must include an inventory of land that is suitable and available for residential development, including both vacant sites and those with a realistic potential for redevelopment during the planning period to meet housing needs across income levels. When a city relies on nonvacant (developed) sites to meet more than half of its lower-income housing obligation, it must provide substantial evidence that existing uses will not impede the development of low-income housing and are likely to be discontinued during the planning period. Redondo Beach sought to meet over 50 percent of its 1,444-unit lower-income RHNA through nonvacant sites, identifying 194 potential units on vacant parcels and relying primarily on two developed properties for the remainder.
Finally, the court rejected the argument that HCD’s prior approval of the housing element insulated Redondo Beach from judicial review.
ISSUES/ANALYSIS
The court’s reaffirmation of Clovis solidifies the principle that overlay zones cannot substitute for base zoning that allows nonresidential development. Merely permitting housing within an overlay does not satisfy the law unless residential use is required and the zoning guarantees development at or above statutory density thresholds. In addition, the opinion reinforces that local governments cannot rely solely on HCD certification to insulate themselves from legal challenge. Even HCD-approved housing elements remain subject to judicial review, and cities bear the ultimate responsibility for ensuring their zoning regulations and site inventories comply with statutory mandates. Courts will scrutinize whether each designated site has a realistic and demonstrable potential for redevelopment within the planning period.
We are advised the City of Redondo Beach will petition the California Supreme Court for review (which is discretionary with the Supreme Court), and we seek authorization from the City Council to participate in the case as amicus curiae (often referred to as a “friend of the court” brief supporting the position of one of the parties) to advocate for clarity and flexibility in the application of Government Code § 65583.2 to overlay zoning strategies.
At this time, it is not advised to amend the Housing Element. It is important to also note that the court’s opinion does not impact projects previously approved by the City. Staff and the City Attorney’s office will continue to monitor the appeal and HCD’s reaction to the Appellate Court’s opinion.
Attachment: California Court of Appeal, Second Appellate District opinion in New Commune DTLA LLC v. City of Redondo Beach