CA Supreme Court allows City of Lafayette’s approval of Terraces apartment project

Denies request to review lower court’s decision, ends litigation, leaving in place earlier rulings that the City acted properly in approving the development

“This decision is a win for housing, but the fact that this project has taken so long is exactly why we have such a catastrophic housing shortage” – Sonja Trauss, President and Founder of YIMBY Law

By Suzanne Iarla, Communications Analyst/Public Information Officer

After more than two years, litigation against the City of Lafayette and developer O’Brien Land Company (O’Brien) regarding the City’s approval of the 315-unit Terraces of Lafayette development project has ended and is in favor of the City and O’Brien.

In 2020, Save Lafayette, a citizens group, sued the City and O’Brien to overturn the City’s approval of the Terraces of Lafayette. In November 2021, the Contra Costa County Superior Court rejected Save Lafayette’s claims and upheld the City’s approval of the Terraces of Lafayette. Save Lafayette appealed the Superior Court’s decision.

In November 2022, the Court of Appeal issued a unanimous opinion holding that the City’s environmental review complied with the California Environmental Quality Act (CEQA) and that the City properly followed the Housing Accountability Act in approving the project. Save Lafayette requested that the California Supreme Court exercise its discretion and review the Court of Appeal’s decision.

On Wednesday, March 15, 2023, the California Supreme Court denied Save Lafayette’s request for review, making the Court of Appeal opinion in favor of the City the final word in the long-running dispute.

“The Courts have once again affirmed that the City complied with the Housing Accountability Act and the California Environmental Quality Act in its environmental review and approval of this 20%-affordable housing project. The litigation is over, and we should now focus on welcoming new residents to our community,” said Lafayette Mayor Carl Anduri.

Now that litigation has ended, O’Brien will be able to proceed with the development of 315 for-rent apartments, including 63 below-market-rate units on a vacant a 22-acre site at the southwest corner of Pleasant Hill and Deer Hill Roads, adjacent to Highway 24 in Lafayette.

In response O’Brien Land Company issued the following press release regarding the court decision:

In a landmark victory for housing rights and state housing law, the California Supreme Court denied review of the unanimous California Court of Appeal ruling in favor of the Terraces of Lafayette

As the last step to finally end the litigation over the Terraces of Lafayette apartment community, the Supreme Court of California denied Save Lafayette’s request to review the First District Court of Appeal’s unanimous ruling that upheld the City of Lafayette’s project approvals. In a published opinion, the Court of Appeal rejected in full Save Lafayette’s lawsuit challenging the Terraces of Lafayette, a 315-unit apartment community by O’Brien Land Company. After nearly 10 years of processing and 120 public hearings, the Lafayette City Council had finally approved the project by a 4-1 vote in August 2020.

The Court’s decision can be found here. Project information can be found at https://www.terracesoflafayette.com.
The project site is in an urbanized area adjacent to Highway 24 and located one mile from the Lafayette BART station. With 20%, or 63, of its dwelling units set aside for lower income households, the Terraces is considered an affordable housing project under the Housing Accountability Act (HAA). This will substantially assist Lafayette in meeting its Regional Housing Needs Allocation (RHNA) for the lower income categories assigned to it by long-standing state law.
Despite the project’s robust legal protections under controlling state law, Save Lafayette has actively opposed the project and all development on the project site for years. The anti-development group also opposed a 44 single-family home compromise project the City approved in 2015 after the City and O’Brien contractually paused processing of the apartment project to consider an alternative the group might accept. Save Lafayette responded by filing litigation and a ballot referendum that overturned the smaller project. Once the voters rejected the smaller project, O’Brien and the City resumed processing the apartments.

“Despite the fact that the project, located on a former quarry site, is supported by the Sierra Club and Greenbelt Alliance, and provides critically-needed, affordable housing, it took 12 years to get to this point after finally getting the project approved and through this and other wasteful litigation,” said Dennis O’Brien, President and Founder of O’Brien Land Company. “It’s been disheartening the last few years to have to tell local residents and workers that we weren’t yet able to build the apartments the City approved. People have long been in need of housing like this for themselves, family members, and local workers, and all we could do was add their name to an interest list and ask them to be patient while we saw the project through an incredibly difficult and time-consuming process. We are elated that we can now move forward.”

Although the apartment project included a full environmental impact report, Save Lafayette’s lawsuit claimed the City’s approval violated the California Environmental Quality Act, a law frequently employed by anti-development NIMBY groups to challenge new housing. The lawsuit also claimed the project was not entitled to the protection of the HAA, which protects housing developments from changes in local land use laws after an application is deemed complete by, among other things, substantially curtailing the circumstances under which a housing project may lawfully be disapproved. As the Superior Court did in 2021, the Court of Appeal rejected Save Lafayette’s arguments and agreed that the City complied with the law in approving the project.

Matt Regan, Senior Vice President of Public Policy for the Bay Area Council added his voice in support of the Supreme Court’s decision saying, “When anyone asks why we have a housing affordability crisis in California, I just show them the history of the Terraces in Lafayette. This is a site where the City said they wanted housing, a developer offered a proposal that met their requirements, and here we are 12 years later after multiple plan changes, referendums, lawsuits, delay after delay after delay, needless costs piled on top of needless costs, and still no homes,” he added.

“The team at O’Brien Homes should be given every credit for refusing to be bullied and sticking with this project.”

The Court of Appeal recognized the HAA’s statutory mandate to interpret and implement the HAA to “afford the fullest possible weight to the interest of, and the approval and provision of, housing” and accordingly held that the trial court “rightly refused to disturb the City’s approval of the project.”

About the decision, Sonja Trauss, President and Founder of YIMBY Law, stated, “This decision is a win for housing, but the fact that this project has taken so long is exactly why we have such a catastrophic housing shortage. The people involved with Save Lafayette should be ashamed of themselves. They have denied housing for more than 700 middle income people for the last 10 years while they fought this project. Imagine if Save Lafayette had spent their time and money actually helping people.”

Allen D. Payton contributed to this report.