Failing a state housing audit may be a “death sentence” for some rural cities.

Governor Newsom may have halted the death sentence of over 700 inmates, but the same cannot be said of California cities. While his proposed budget provides more than $2 billion in a variety of grants and awards, failing a state housing audit may be a “death sentence” for some of California’s rural cities. Cities may find their hard-earned funds from SB 1 are forfeit.

Previously, the state had neither the tools nor the inclination to invoke consequences on cities that fail to meet the affordable housing targets. But Assembly Bill (AB) 72 has given the state the ability to refer cities to the Attorney General when they fail to meet housing goals. Further, Newson is showing his willingness to use this new tool. In his words, he “isn’t playing small ball with housing.”

Huntington Beach is a poignant example. The historically Republican city is known equally for its nine miles of surf-friendly coastline and its high housing prices. The average apartment is $2,144 a month. Huntington Beach is now being sued for willful noncompliance. In 2013, Huntington Beach had submitted a plan that met state regulations. But in 2015, the Kennedy Center noticed the plan had changed thereby breaking the law.

The Kennedy Center sued the city bringing the issue to the attention of the state. Four years later, the city has not made any new plans. As a Charter City, Huntington Beach claims it has more autonomy over its housing choices and that the state’s mandates are in violation of its Charter. Some observers say Huntington Beach has the resources to choose litigation over compliance, while other cities, without the financial boons of oil and tourism, don’t share this luxury.

More municipalities in the Central Valley are failing to meet state law than are succeeding, which threatens their transportation budgets. For Fresno and Kern Counties, this non-compliance puts over $17 million at risk. This is a potentially fatal blow in a region where the Transportation Cost Burden hovers around 30 percent of total income and some streets lack pavement entirely.

Fresno County’s budget has marked the SB 1 Funds to “be used to slow the deterioration of the County’s road system.” However, the region faces a number of challenges, including the logistics of planning such developments, funding the projects, and relying on developers are willing to provide solutions.

Unlike Huntington Beach, the Central Valley appears to have state support. Newsom is committed to working “collaboratively with all of the representatives in those communities… [to] understand the challenges and struggles they face… [because they have] honest, forthright explanations as to why it’s difficult and why they need support.”

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