Elk Grove, a suburb of Sacramento, has reached a settlement with California Governor Gavin Newsom’s administration, resolving a legal dispute over affordable housing. The settlement, announced Wednesday, comes after the state alleged that the city unlawfully blocked an affordable housing project.
Under the terms of the agreement, Elk Grove is required to designate a new site for affordable housing by July 1, 2025, ensuring the location provides good access to economic, educational, and health resources. Additionally, the state will have increased oversight of the city’s affordable housing approvals for the next five years, including regular updates on project statuses.
Attorney General Rob Bonta criticized the delay in Elk Grove’s compliance, stating, “Our housing laws are not suggestions. You have to follow them. And if cities try to skirt them — try to avoid building the housing we need, try to illegally deny housing proposals, or discriminate against communities, as Elk Grove did — the DOJ will hold them accountable.”
The lawsuit, filed by the state, accused Elk Grove of violating state laws by rejecting a proposal to build 66 affordable units in Old Town for those at risk of homelessness. The state argued that the denial contravened laws designed to streamline housing projects and prevent discriminatory practices by local governments.
This legal clash underscores the ongoing tension between state and local authorities over housing development. Governor Newsom previously withheld funds from local governments in 2022 for failing to address homelessness effectively and has also pursued legal action against Huntington Beach for similar reasons.
As part of the settlement, Elk Grove will pay the state $150,000 to cover legal fees. Despite this, local officials expressed satisfaction with the outcome, emphasizing the city’s commitment to affordable housing development. “Elk Grove is proud of its leadership role in regional affordable housing efforts,” the city stated. “We hope future collaborations with the State will be more constructive and less focused on litigation.”
In 2022, the Elk Grove Planning Commission rejected the Oak Rose Apartments project, citing non-compliance with local standards. Earlier this year, the city settled a separate lawsuit related to the project and approved an alternative 81-unit affordable housing development at a different site.
California faces a significant housing shortage, with the state needing to build 2.5 million homes by 2030 to meet demand, according to the California Department of Housing and Community Development. Governor Newsom highlighted the severity of the housing crisis, calling it “the original sin” of the state.
