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Legal Match

Is "spot zoning" illegal?

The term “spot zoning” is thrown around a lot in discussions about planning and development and the vast majority of the time the term is misused and misunderstood. So, what is spot zoning and how is it applied to local planning decisions?

It is common practice for developers to approach a city with a project proposal that requires a zoning change and amendments to the city’s General Plan. In response, city planners and developers often engage in what might be called “horse-trading;” discussions about what the city will require the developer to do to approve their requested zoning change. These requirements are as varied as the types of projects submitted and depend on size, location, impacts, and project type (commercial, residential, industrial, etc.).

For example, for a large commercial project, a city may require impact fees to pay for infrastructure improvement costs or a street realignment or added parking facilities or other such improvements. For a housing project, a city may require certain public amenities or increased percentages of affordable units. But these discussions are not binding unless a formal development agreement is entered into. Prior to that, the developer can just say no, and walk away, or make changes to the project that might not need a change in local regulations.

Most of the time, the city's requirements are related to the project but that does not have to be the case. They can be whatever the parties agree to so long as it is in "the public interest," is legal, and doesn’t violate state law.

In other words, a city can request that a developer build a community center, but not if the land for it is purchased from a city council member's brother for top dollar, unless it can be shown that this is somehow in the public interest.

Regarding affordable housing developments, state laws have pretty much eliminated the city’s power to request anything from developers. In fact, it is now the developers who can demand waivers and concessions from cities and object to any requests that might, in their sole opinion, negatively impact the financial feasibility of the project.

In any case, the actual rezoning of a specific property or an amendment to a General Plan requires a public hearing, giving the public its chance to weigh in.

This sequence of events happens all the time. But isn't this illegal “spot zoning?”

It turns out that this is the wrong question to ask. Almost all rezoning could be categorized as spot zoning, but the real question is if that spot zoning is “permissible” or “impermissible.”

A good explanation of this difference is found in the 2014 Appeal Court decision in Foothill Communities Coalition v. County of Orange, in the Fourth District Court of Appeal. In that decision, the court cited Avenida San Juan Partnership v. City of San Clemente (2011) 201 Cal.App.4th 1256, noting that,

"The essence of spot zoning is irrational discrimination." [Emphasis added]

The Court of Appeal’s decision clarified the law regarding spot zoning in two respects:

"First, spot zoning may occur whether a small parcel of property is subject to more or less restrictive zoning than the surrounding properties. Second, to determine whether impermissible spot zoning has occurred, a court is required to conduct a two-part analysis. After determining that spot zoning has actually occurred, the court must determine whether the record shows the spot zoning is in the public interest." [Emphasis added]

The Court noted that so long as the agency’s action was not “arbitrary or capricious, or totally lacking in evidentiary support,” and if the agency “made requisite findings to support its decision,” spot zoning is permissible.

In the case before them,

“That factor was that the [agency] had substantial findings supporting their decision to confer special benefits to the particular parcel and that in doing so, the public at large would benefit from such action. It cannot be stressed enough as to the importance of building a sound foundation of factual analysis incorporated into findings adopted by the legislative body to create a clear administrative record in support of such a decision.”

As such, determinations about whether a rezoning of a particular parcel or area was “permissible” spot zoning is based on the facts and circumstances and whether the approving agency (the city) makes "findings" to establish that the rezoning provided a "public benefit" and is in the "public interest."

For instance, this could include findings that a project proposal helped achieve the goals and policies of the General Plan or that the rezoning action was important to the public health, safety, and welfare. But that rezoning cannot result in a discriminatory outcome or unjustified "private benefit." It is impermissible (illegal) spot zoning if it’s discriminatory and provides a unique burden or intentional benefit to one landowner or resident over another. (e.g., one can negotiate to have a developer build a public swimming pool, but not just to benefit a council member's pool cleaning business).

This makes sense because cities rezone parcels all the time, from one use to another on public and private land, and need the ability to do that when it's in the public's interest. In fact, “spot zoning,” per se, is actually extremely commonplace, as the case noted above shows. Even placing a "housing overlay" in an area is technically spot zoning but it is typically assumed to be permissible even without specific findings because it can rely on the city’s Housing Element requirements (which are categorically considered to be a “public benefit”) and because all state housing laws establish that housing development is in the public interest and an issue of "statewide concern."

The answer to the question then is that spot zoning is perfectly legal. Whether or not a particular instance is permissible, depends on the facts and circumstances. Those who claim that spot zoning is somehow categorically not allowed are simply incorrect.

Bob Silvestri is a Marin County resident, the Editor of the Marin Post, and the founder and president of Community Venture Partners, a 501(c)(3) nonprofit community organization funded by individuals and nonprofit donors. Please consider DONATING TO THE MARIN POST AND CVP to enable us to continue to work on behalf of all California residents.