Court of Appeal Confirms Builder’s Remedy Must Comply with Certified Local Coastal Programs
On July 30, 2026, in New Commune DTLA LLC v. City of Redondo Beach (B337897), the California Court of Appeal held that the builder’s remedy does not require approval of a residential development that conflicts with land-use restrictions in a city’s certified Local Coastal Program (“LCP”). Although the Housing Accountability Act (“HAA”) limits a city’s ability to deny qualifying builder’s remedy projects, it does not authorize a local government to disregard California Coastal Act requirements.
HAA Limits Local Authority to Deny Housing Projects but Does Not Override Coastal Act Requirements
Under California’s Housing Element Law, local governments must periodically prepare a “Housing Element” to comprehensively address existing and projected housing needs and develop a program to meet those needs. (See Gov. Code, §§ 65580, 65582.) The Department of Housing and Community Development (“HCD”) certifies a Housing Element if it meets the jurisdiction’s Regional Housing Needs Allocation (“RHNA”). When a local government fails to obtain an HCD-certified Housing Element, the HAA imposes a significant limitation on local land use control, commonly referred to as “builder’s remedy.” Under builder’s remedy, a local government is severely constrained in its ability to deny a housing development project, particularly affordable housing, even when that project does not conform to local zoning standards. (§ 65589.5.) However, builder’s remedy does not “relieve the local agency from complying with … the California Coastal Act.” (Gov. Code, § 65589.5(e).)
After prevailing in a prior lawsuit against the City to invalidate its housing element, New Commune DTLA, LLC proposed to build a housing development project consisting of 30 condominium units, six of which would be restricted affordable units. The project was proposed for a parcel located within the City’s commercial coastal zone, which was governed by the City’s certified LCP. Because the City lacked a compliant Housing Element at the time the project was submitted by New Commune DTLA, LLC, the project was required to be reviewed as a builder’s remedy project under the HAA. Under the LCP, the commercial coastal zone did not allow residential uses by right or conditionally. Despite being a builder’s remedy project, the City denied the project because it did not comply with the City’s LCP. The City did advise New Commune that it could pursue an LCP amendment, but the developer filed a petition for writ of mandate instead to compel the City to approve the project under the HAA.
In affirming the City’s denial of the development project, the Court addressed the interaction of two important statutory schemes: the HAA, which limits local barriers to housing development and the Coastal Act, which protects coastal resources through shared state and local oversight. The developer argued that the two statutory schemes could be harmonized by prohibiting a local government from denying a housing development in the coastal zone unless the local government could identify an objective state policy that prohibited the project. The Court rejected this argument, concluding that the developer’s approach would bypass the LCP amendment process and effectively authorize new coastal land uses without state oversight required by the Coastal Act.
The Court reached this conclusion because an LCP is not comprised solely of local law. After an LCP is certified, the California Coastal Commission delegates limited authority to a local government to issue Coastal Development Permits. The local authority, however, cannot approve development that does not conform to the certified LCP. When a proposed project involves a land use not authorized by the LCP, the City must pursue an LCP amendment and obtain the certification of the Coastal Commission or deny the project. In New Commune DTLA LLC v. City of Redondo Beach, the Court concluded that builder’s remedy projects were not immune to the Coastal Act’s requirements, and therefore the City was required to deny the project.
Moreover, the HAA itself provided the mechanism for reconciling the statutes. Government Code section 65589.5, subdivision (d)(3), permits denial of a qualifying housing project when denial is required to comply with specific state or federal law and there is no feasible method to comply without rendering the development unaffordable. In applying that provision, the Court concluded that the Coastal Act required denial because the City lacked authority to approve the proposed residential land use under the existing certified LCP.
City Need Not Analyze Legally Infeasible Alternative to Comply With HAA
In order to deny a builder’s remedy project under Government Code section 65589.5, subdivision (d)(3), the local government must show there was no feasible method to comply with the law without rendering the development unaffordable. The Court upheld the City’s determination that no feasible method of compliance had been demonstrated. The City had informed the developer that the project was not permitted in that area of the coastal zone, and invited the developer to apply for a changed designation of land to allow residential uses. The developer declined. Accordingly, the City lacked a record from which it could determine whether residential development could feasibly be authorized.
This case provides clarity for jurisdictions that are in the coastal zone by affirming that the HAA and the builder’s remedy do not override local jurisdictions’ obligations to comply with the Coastal Act. Additionally, this case serves as a reminder that if a local government is going to deny a housing project, it must comply with the requirements of section 65589.5 and make any necessary findings.
For questions on the implications of the New Commune DTLA LLC v. City of Redondo Beach (B337897) ruling, please contact your BBK attorney or reach out to Alexander Brand and Michael Ervin.
