Introduction
“Local control isn’t biblical.”
— California State Senator Scott Wiener
“Local government, when done right, is the best and most democratic form of government because it is closest to the people. . . . [P]eople deserve to have decisions affecting their daily lives made as close to home as possible.”
—Former Beverly Hills Mayor John Mirisch
Traditionally, most land-use decisions have been made by local governments. The impacts of land-use decisions are felt most acutely, it is said, by those living nearby. Only local governments, the governments closest to the people, understand the culture, topography, and history of the community sufficiently to judge the wisdom of altering its character. In the last few years, however, as many areas of the country with high levels of job growth have faced a serious housing shortage, the dark side to local control has increasingly become evident. Local governments are often beholden to local residents, especially homeowners, who vigorously oppose new development in their communities. And although each locality controls only the land use decisions within its borders, it is commonplace for many neighboring localities within a region to all oppose new development. The cumulative result is an extreme shortage of regionally needed but locally undesirable land uses like gas stations, schools, jails, waste facilities, and especially housing. Hence, state legislators like California’s Senator Scott Wiener have come to the view that states need to take a more assertive role in land-use regulation, overriding (or “preempting”) some local control. California and Oregon have recently passed legislation that preempts some local land-use authority, while legislators in Virginia and Maryland have proposed similar legislation.
These efforts at preemption have met a furious backlash, however, from local governments and angry homeowners. They have relentlessly, and often successfully, fought back any attempt to preempt local land-use authority. Though Senator Wiener observes that local control “isn’t biblical,” many residents have become so accustomed to local control that they perceive it as something akin to a birthright. And whether or not local control is divinely ordained, opponents of state preemption have been led to wonder if it is the next best thing—constitutionally guaranteed. In many states, including California, cities that adopt a charter enjoy “home rule” under the state Constitution, which gives charter cities the power to act and some immunity from state preemption in matters that are deemed to be “local” or “municipal” affairs. Local control of land use has been so unquestioned for so long that it is tempting to think it must be just such a “municipal affair.”
Indeed, this issue has become a live one in the last year or so. Trial courts in Northern California recently struck down two pieces of state housing legislation that preempted local land-use control, citing the home-rule power of charter cities. One of those decisions was subsequently overturned on appeal, with the appellate court holding that the state’s interest in addressing the affordable housing shortage warranted the intrusion upon local control. The other case is pending on appeal. Meanwhile in Southern California, the charter city of Huntington Beach sued the state of California on the grounds that several recently enacted pieces of state legislation that preempted some aspects of local land-use control unconstitutionally usurped charter cities’ exclusive power over land use. According to the city, the principle “of local autonomy over local zoning and land use is guaranteed to Charter Cities” by the California Constitution, and therefore the Constitution gives charter cities like Huntington Beach “exclusive authority devoid of any state control” over land use matters.
The question I propose to answer here is whether Huntington Beach is correct. Does home rule shelter charter cities against a state assertion of land use authority that conflicts with local control? Although it is difficult to generalize without evaluating the specifics of a particular conflict, in most cases the answer will be no. To begin with, courts have very rarely held that any area is completely immune from state preemption. The touchstone of the state preemption inquiry is whether there is a statewide interest in regulating a matter and, relatedly, whether local control has a sufficiently substantial extra-local impact that state intervention is appropriate. In the land use context, courts have consistently held that the state canpreempt local land-use authority because land use intersects with issues of statewide concern like regional land use planning, environmental protection, and housing affordability. It is rare, indeed, for the impacts of a local land use decision to be so fully contained within the boundaries of a municipality that it would not touch upon these statewide concerns. The externalities of one community’s land-use decisions often have considerable impacts on neighboring towns, the regional housing market, and the statewide economy. In fact, it is increasingly recognized that local land-use decisions actually have national and possibly international political and economic ramifications. For that reason, while courts have recognized the importance of land-use control to localities, they have never held that land use is an exclusively local function. To the contrary, as discussed herein, they have generally upheld state preemption of local land-use regulation.
Therefore, I expect courts to conclude that local governments have no immunity against state preemption of local land-use control. Perhaps anticipating exactly that outcome, defenders of local control in California like Beverly Hills councilmember John Mirisch are already preparing a backup plan: qualifying a ballot initiative that would amend the state Constitution to guarantee local control of land use against state preemption. I close this paper with thoughts on that idea. Such an initiative would confront few legal barriers, assuming it could raise the millions of dollars necessary to gather enough signatures to qualify the measure. But the initiative would be a remarkably bad idea—for those who favor local control. For one thing, a statewide referendum on the wisdom of exclusive local-land use control would probably end badly for its advocates. Polling shows that a majority of Californians favor state intervention to increase the supply of housing. But the problem is not only that a local-control initiative could lose badly. The initiative could also spark a counter-initiative that would aggressively preempt local-land use control, weakening local control of land use even further. In addition, even if a local-control initiative were successful, cities would still find themselves in a subordinate position relative to the state because the state controls most of the revenue sources that cities desperately need. So far, the state has resisted tying distribution of revenue to local governments meeting state land-use goals, but that could easily change if local governments try to change the balance of power between themselves and the state. Local governments should consider what happened the last time they tried that strategy. In 2010, cities succeeded in passing a ballot initiative that prevented the state from taking local money earmarked for redevelopment, so the state simply abolished the entire redevelopment process and has since refused numerous pleas by local governments to revive it. Redevelopment is a cautionary tale for local governments that seek to use the initiative process to wrest power from the state.
I. Basic Principles of Home Rule
Local governments have no inherent right to self-rule. According to a long-standing judicial principle known as “Dillon’s Rule,” the constitutional source of which remains mysterious, local governments are creatures of the state. They have only the powers specifically delegated to them by the state and no rights against the state. In the early twentieth century, however, several groups of urban reformers sought to provide cities with a form of “home rule” that would enable them to act of their own initiative and give them some immunity against state interference in their affairs. The reformers were deeply concerned about what they saw as excessive meddling by corrupt state legislators into the affairs of urban government, and they attributed this situation in part to Dillon’s Rule. They envisioned local government as an imperium in imperio, or a “state within a state,” and they pushed to give local governments what became known as “imperio” home rule. Imperio home rule empowered cities to adopt a charter that would give them independent authority to initiate legislation on local affairs without an express delegation from the state, as well as immunity against state preemption of local regulation. Many states enacted constitutional amendments enshrining imperio home rule, and, because the power of home rule was thus constitutionally guaranteed, imperio home rule became known as “constitutional home rule.” An example of a constitutional home rule provision is Article 11, section 5(a) of the California constitution, which states in pertinent part as follows:
It shall be competent in any city charter to provide that the city governed thereunder may make and enforce all ordinances and regulations in respect to municipal affairs, subject only to restrictions and limitations provided in their several charters and in respect to other matters they shall be subject to general laws.
Like most home rule provisions (and, frankly, like most of California’s Constitution), the meaning of section 5(a) is rather unclear. Nevertheless, one thing that section 5(a) does make clear is that local governments have the power to initiate legislation and enjoy immunity against state preemption with regard to “municipal affairs,” but are subject to state control with regard to “other matters” that are not municipal in nature. This structure is typical of imperio home rule provisions. Borrowing from the commerce-clause jurisprudence of the early twentieth century, which categorically distinguished “national” from “local” spheres of competence, the crafters of imperio home rule envisioned states and local governments as having distinct and mutually exclusive spheres of activity: local governments may only legislate in matters of “local” or “municipal” concern, and the state can only legislate in matters of greater than local concern, often called “statewide” or “general” matters.
However, because state constitutions rarely specify what powers are “municipal” and what are “general” or “statewide,” an important role has necessarily been left for the courts to define the meaning of these terms. In general, as I discuss in the next section, courts have tended to construe the term municipal rather narrowly so as to limit the field of local initiatory power, and they have construed the term general or statewide quite broadly, especially where the legislature has expressed an intention to preempt local regulation. As a result, it is rare for the courts to find that any field of local regulation is immune from state preemption.
In fact, courts’ interpretations of imperio home rule provisions so tightly circumscribed municipal power that, by the 1950s, a new group of reformers began pressing for changes to home-rule doctrine. These reformers advocated a revised form of home rule under which states could simply delegate to local governments all the powers that states themselves possessed, regardless of whether the power was characterized as local or statewide (though the state could reserve to itself the right to act exclusively in specific subject-matter areas). According to Paul Diller, a law professor at Willamette University, this model “intended to substitute the legislature for the judiciary as the primary adjudicator of the extent of home rule powers” and accordingly became known as the “legislative” home-rule model (or alternatively the Fordham model or the NML/NLC model). A characteristic example of the legislative home rule model is Article 10, section 11 of Alaska’s Constitution, which states: “A home-rule borough may exercise all legislative powers not prohibited by law or by charter.” Today, although it can be difficult to ascertain which model a particular state follows because the constitutional language is often imprecise, almost half the states follow the older “imperio” model, and almost half follow the legislative model, while a few holdout states still adhere to Dillon’s Rule.
In practice, the distinction between imperio and legislative home rule is not always clear. This lack of clarity is due in part to imprecision in the constitutional language, and in part to judicial interpretations that have diminished the distinction. Even in states that appear to have legislative home-rule provisions, courts have often barred cities from acting in matters deemed to be statewide, and on occasion they have even read legislative home-rule grants to imply a sphere of immunity from preemption.
II. Home Rule and Preemption Today
In those few states following Dillon’s Rule, local governments have no immunity from state preemption on any issue. In principle, this is also true of legislative home rule states, although, as just described, courts have occasionally found a modest sphere of immunity implicit in the grant of legislative home rule. In those states still following the older imperio model, home-rule immunity theoretically grants a robust protection for charter cities against preemption. Today, however, it is relatively rare even in imperio states for a court to rule that a charter city is immune against a state assertion of supremacy, and courts have never held that any particular subject matter is so wholly committed to local governments that the state may never preempt municipal authority in that area.
There are several reasons why the home rule inquiry tends to favor the state. As an initial matter, the standards that courts have articulated for defining the line between municipal and statewide affairs are heavily weighted towards state preemption. Admittedly, general principles mean little in this inquiry because no precise mechanism exists for delimiting municipal from statewide affairs. The question must be answered “on an ad hoc basis, taking into consideration the facts of each case” Nevertheless, it is instructive to look at the general standards that courts use to resolve these cases.
Here are some of the key guidelines. First, the court will give significant weight to a determination by the state legislature itself that a matter is of statewide rather than purely local concern, though such a determination is not conclusive. Second, the dividing line between statewide and municipal affairs is not fixed, and so a matter that was at one time local in nature can become a matter of statewide concern. Third, courts will consider the need for statewide uniformity in the regulation of a particular matter. Fourth, if local regulation has significant impacts outside local borders, it is likely to be considered a statewide matter. Fifth and finally, courts may consider whether a particular matter has traditionally been regulated at the state or municipal level.
A quick look at these factors reveals a decided slant in favor of the state. The first factor gives state legislatures substantial power to dictate the relationship between themselves and local governments—a power they are surely inclined to use to favor their own authority to preempt. The second factor anticipates that matters may evolve over time from local to statewide, but the judiciary has never intimated that the reverse can happen. In short, the universe of statewide matters is ever-expanding while the universe of local matters is constantly shrinking. “Uniformity” is a plausible argument in almost every case, and, as an institutional matter, courts tend to favor uniformity. Finally, most local regulation has some extraterritorial impact. One factor that may weigh in favor of local control in certain cases is tradition, although there are few fields that the state has traditionally left entirely to exclusive local control.
As discussed previously, general principles only go so far in dealing with such a fact-specific question as the distinction between state and municipal affairs. By the same token, however, the absence of fixed principles allows courts to easily place a thumb on the scale in favor of whichever side they prefer. In general, as the standards suggest, they have preferred the state. Courts commonly hold that most areas, including criminal law, public health, public safety, education, taxation, financial regulation, and regulation of utilities are statewide in nature. In doing so, the courts have often emphasized the extra-local impacts of local regulation and the need for statewide uniformity in a modern urbanized society. For example, in a very recent decision, the California Court of Appeals turned aside a home-rule challenge to a law called the California Values Act, which requires local law enforcement to refrain from cooperating with federal immigration authorities. The court observed that “California is highly urbanized and integrated” and that cities “flow seamlessly into one another.” Therefore, the court found that the effects of one charter city’s decision to opt out of the California Values Act “would not be limited to the city’s residents but would extend beyond the city’s borders.”
To be sure, there are a few areas that courts have occasionally considered the exclusive province of municipalities, but they tend to be areas with few obvious extraterriorial impacts and a particularly weak case for statewide uniformity. For example, courts have sometimes held that certain types of financial decisions, such as the issuance of municipal bonds or the collection of special assessments, and personnel decisions such as the hiring, firing, wages and benefits of municipal employees are municipal affairs immune from preemption, although even in these areas many courts have held to the contrary. Decisions about the internal structure of local government, such as whether to have a strong or weak mayor system, when to hold local elections, whether to elect councilmembers at-large or by district, how to finance municipal elections, and so forth, have often also been considered solely municipal affairs, although again a substantial amount of precedent exists to the contrary.
In general, attempting to identify discrete subject-matter areas as either “statewide” or “local” is likely to be fruitless. Though the Progressive-era architects of imperio home rule envisioned the spheres of municipal and statewide affairs as mutually exclusive, courts today recognize that in practice these affairs often overlap. For instance, in the landmark decision of California Federal Savings & Loan Ass’n v. City of Los Angeles (CalFed), the California Supreme Court instructed that courts must reject a “compartmentalized” view of governmental affairs, in which state and local governments each have fixed spheres of authority, and instead employ a “dialectical” analysis in which the local and state interests are both considered. This dialectical analysis invites the kind of multi-factorial inquiry described earlier. Notably, even under the dialectical approach, courts tend to favor the ability of the state to preempt local control. In CalFed, for example, the court observed that the statewide interest in a given matter is a “conceptual limitation” on the home-rule authority of charter cities. Accordingly, the court held that a state law addressed to a statewide concern and reasonably related to the resolution of that concern can constitutionally preempt a measure enacted by a charter city. Likewise, courts have held that “[w]hen there is a doubt as to whether an attempted regulation relates to a municipal or to a state matter, or if it be the mixed concern of both, the doubt must be resolved in favor of the legislative authority of the state.”
III. Preemption of Local Land Use Control
A. Why Local Land Use Control Is Not Constitutionally Guaranteed
It is tempting to assume that local control of land use must be constitutionally guaranteed because the common practice in most states is for local governments to exercise much day-to-day land use authority. In states that follow Dillon’s Rule, legislatures have broadly delegated land-use powers to local governments. In home-rule states, courts have inferred substantial local authority to regulate land use from constitutional grants of power to local governments, coupled with a historical tradition of local land-use regulation (although most states have a significant body of state law in this area). In Big Creek Lumber Co. v. City of Santa Cruz, for example, the California Supreme Court stated:
Land use regulation in California historically has been a function of local government under the grant of police power contained in Article 11, Section 7 of the California Constitution. . . . And the Legislature, when enacting state zoning laws, has declared its “intention to provide only a minimum of limitation in order that counties and cities may exercise the maximum degree of control over local zoning matters.” Thus, “[t]he power of cities and counties to zone land use in accordance with local conditions is well entrenched.”
This sweeping affirmation of local power can easily be misread, however. While the court held that local governments have broad powers to initiate land-use legislation, it did not hold that local governments can act in the face of preempting state legislation. In fact, Big Creek recognized the power of the state to preempt local land-use control, but found that the state had not clearly expressed an intention to preempt the local land-use regulation at issue in that case. As the court stated, when it comes to land use regulation, “California courts will presume, absent a clear indication of preemptive intent from the legislature, that such regulation is not preempted by state statute.” Thus, the court actually acknowledged the power of the state to preempt local land-use control with a clear indication of preemptive intent.
There is no inconsistency between the court’s broad recognition of local power to regulate land use and its affirmation that the state can nevertheless preempt local land-use control because, as discussed earlier, modern courts reject the “compartmentalization” of governmental affairs into separate spheres for state and local activity and instead use a “dialectical” approach in which local governments have wide-ranging authority to act, but their authority is curtailed when it interferes with a superior state interest. Therefore, in most cases where the legislative intent to preempt local land use control is clear, the courts have held that cities—including charter cities—have no immunity against preemption.
In fact, as noted previously, most states have enacted a significant body of legislation guiding and limiting local land-use discretion, and this legislation has usually withstood judicial scrutiny. In California, for example, local land-use control is subject to many state laws. Cities are required, among other things, to adopt a general plan with specific elements, plan and zone for a prescribed amount of housing at specified levels of affordability, report the environmental impacts of developments, adopt a uniform statewide Building Code, consider specific criteria when approving subdivisions, and grant residential development a prescribed “bonus” of additional density when the development meets certain state-determined thresholds. Cities are very limited in their ability to enact rent control or condominium-conversion laws, face restrictions on assessing and spending development fees, and have many other limitations on their land-use powers. Not all of these laws have been judicially challenged as violating a charter city’s home-rule powers, but those laws that have been challenged were all upheld by the courts.
It makes sense that courts would uphold the power of states to preempt local land-use regulations because few areas of local regulation have greater statewide impacts than land use, and courts have been clear that the hallmark of a statewide interest is the presence of an “extramunicipal concern,” that is, whether the state law contains “a dimension demonstrably transcending identifiable municipal interests.” Local land-use decisions often have substantial impacts outside their borders. For example, if a city with high job growth refuses to permit sufficient new housing, the demand may have to be absorbed by communities located further from those jobs, increasing the length of commutes and worsening greenhouse gas emissions. If several cities in a particular region with high demand for housing fail to permit sufficient housing, then the scarcity will cause a region-wide and possibly statewide increase in rents and home prices.
The scenario just described is not hypothetical. In high-opportunity areas throughout the country, cities do not permit nearly enough housing to meet the demand. For instance, cities in California—a state with enormous economic growth and demand for housing—use zoning regulations to place the vast majority of land off-limits for any kind of multi-family housing. Reliable reports estimate that apartments are banned on as much as two-thirds of the land in California. The effect of the apartment ban is that demand for housing cannot be accommodated by building housing at a greater density, and, given that the supply of land is necessarily limited, it is literally impossible for cities in California to accommodate an increase in demand for housing without changing the zoning laws. However, once in place single-family zoning is very rarely loosened, and the process of obtaining a zoning change is exceptionally burdensome and expensive. What is more, even in places that are already zoned for housing at the appropriate density, obtaining an approval is full of unpredictable delays, improper denials, and exorbitant fees that raise the cost of housing. Restrictive zoning has a very clear ripple effect, as recent research demonstrates that resistance to new housing by cities in coastal California has pushed up housing prices further inland. As a result of the cumulative reluctance by cities throughout the state to approve housing to meet the demand, California is forty-ninth out of the fifty states in homes per capita. It has the highest poverty rate when accounting for housing costs, home prices, and rents that are much higher than almost any place else, the highest rate of homelessness, and an unmet demand for up to an additional 3.5 million homes.
The courts have long acknowledged the significant extra-local impacts of local land-use regulations. The California Supreme Court, for example, observed that “municipalities are not isolated islands remote from the needs and problems of the area in which they are located.” Hence, when courts have upheld state preemption of local land-use regulation, they have affirmed the power of the state to address matters that “do not respect municipal borders,” such as preventing “haphazard community growth,” balancing the “ecological and environmental impacts of land use,” protecting “environmental and economic resources,” providing “comprehensive management and oversight” of land use matters, and alleviating the “shortage of sites available for affordable housing development.”
In finding that the extra-local impacts of local land-use regulation justify state preemption, the courts have emphasized that “[a]s conditions in the state change, what was once a local concern may later become a matter of statewide concern controlled by general law.” For example, in a landmark case in which the states of California and Nevada created a regional authority to govern the Lake Tahoe region, the California Supreme Court held that the state could constitutionally preempt local land-use authority because
problems which exhibit exclusively local characteristics at certain times in the life of a community, acquire larger dimensions and changed characteristics at others. . . . When the effects of change are felt beyond the point of its immediate impact, it is fatuous to expect that controlling such change remains a local problem to be solved by local methods.”
In other words, though local governments have traditionally exercised the lion’s share of land-use authority, that distribution of power is subject to change if statewide problems emerge that cause the state to assume some control of land use. In recent years, indeed, many states have experienced an acute shortage of housing, causing massive statewide problems. I have already described some of those problems in California, such as rising home prices, increased homelessness, and the highest poverty rate in the country. In addition to those concerns, there is now increasing evidence of the severe extra-local impacts of local land use regulation. One recent study found that the inability of workers to locate in the most economically productive regions due to high housing costs has diminished the entire United States’ economic performance by $1.27 trillion over the last generation. An abundance of recent research links restrictive local land-use regulations to higher greenhouse gas emissions and increased racial segregation in large metro areas.
For all of these reasons, the severity of the housing shortage in places like California has become undeniable. The California Supreme Court recently stated:
It will come as no surprise to anyone familiar with California’s current housing market that the significant problems arising from a scarcity of affordable housing have not been solved over the past three decades. Rather, these problems have become more severe and have reached what might be described as epic proportions in many of the state’s localities.
The court’s conclusion was echoed by the California legislature, which recently declared in the preamble to an important new piece of housing legislation that the state “has a housing supply and affordability crisis of historic proportions,” citing a wealth of statistical evidence regarding the statewide impacts of the housing shortage. The legislature also recognized that the housing shortage contributed to climate change by displacing people to locations far from job centers, thus requiring longer commutes. “California’s cumulative housing shortfall therefore has not only national but international environmental consequences.”
B. Narrow Tailoring and the Case for Local Control
What has been said so far sufficiently demonstrates that the state has a strong interest in preempting local land-use control when local control has significant statewide consequences, such as the present housing crisis. As I have explained, however, many state courts employ a “dialectical” approach to home rule in which both the state and local interest in regulating a matter are considered. In California, for example, when a law implicates a conflict between state and local interests, the courts are supposed to then inquire whether the state law is “narrowly tailored” to avoid excessive interference with local control. To date, the courts have given little guidance on what it means for a law to be narrowly tailored in this context. In its only decision addressing this question, though, the California Supreme Court in CalFed held that a state law preempting local taxation of savings banks was narrowly tailored because the interference in local affairs was “substantially coextensive with the state’s underlying regulatory interest.” In other words, as long as the means the state chooses to address a statewide interest is “reasonably related” to its interest, it is sufficiently tailored to withstand judicial scrutiny.
In the land use context, as described earlier, local land use regulation has severely restricted the operation of regional housing markets and thereby created a serious housing crisis. For that reason, state preemption of local land use regulation to loosen local restrictions and enable the housing markets to function more smoothly should in most cases be sufficiently “coextensive with the state’s underlying regulatory interest” in addressing the housing crisis to survive a home rule challenge. One question this conclusion raises is when, if ever, state regulation would not be reasonably related to the state’s interest. An example might be where the state’s enactment has no clear connection to a statewide interest, or where local land use control of a particular matter has so little extra-local impact that it should be considered exclusively local and immune from state preemption. A few cases from the early twentieth century hold that matters such as the location of oil and gas wells or the heights of local buildings are purely local affairs.
Courts should be careful, however, before concluding that any instance of local land use regulation is so discrete that it will not have statewide impacts justifying preemption. It is fairly clear today that even seemingly small land use decisions can have significant statewide effects. This is so because, as discussed earlier, most cities tend to have startlingly similar zoning ordinances. One municipality’s decision to enact height limits on homes might have few external impacts, but when hundreds of municipalities across the state make the same decision, it can have enormous statewide repurcussions on the housing supply. Likewise, if dozens of cities restrict the locations of oil wells, it may become impossible to find sites for oil wells anywhere in the state.
A timely example of a small decision with huge statewide impacts is the question of “accessory dwelling units” (ADUs). In recent years advocates have pushed for cities to allow as of right on parcels zoned for single-family residential use the construction of a smaller second residence, sometimes called a “granny flat” or “backyard cottage.” These ADUs could be occupied by a family member or friend or leased to a tenant. In isolation, a single community’s decision whether to permit ADUs on single-family parcels would probably have little effect outside local borders. But, in reality, scores of cities have placed severe limitations on the ability of homeowners to construct and lease ADUs to tenants. Considering that, in many high-opportunity areas like California, most of the land is zoned to prohibit every housing type aside from single-family homes, this restriction amounts to a nearly statewide moratorium on ADUs, severely constricting the statewide housing supply in many places. Under those circumstances, a blanket state legalization of ADUs could dramatically increase the state’s housing capacity and relieve the demand pressure. Indeed, that is exactly what the state of California did over the last few years. It initially reduced the ability of local governments to regulate ADUs, then finally swept away that ability almost entirely, authorizing the placement of at least two ADUs—one separate backyard cottage and one attached “junior” apartment—on every parcel zoned single-family residential throughout the state, in one swoop nearly tripling the state’s zoning capacity. Cities throughout the state saw a dramatic increase in ADU applications almost immediately after the reforms, with Los Angeles reporting an increase from just eighty applications in 2016 to nearly two thousand in 2017. There can be little doubt that this small change in local land-use regulations addressed a statewide concern in alleviating the state housing crisis.
Nevertheless, were a city zoning law to address a truly unique local condition with few statewide consequences, state preemption of such a law might be considered insufficiently tailored. A historic preservation law that requires owners of historically significant buildings to maintain the facades could be an example. Even here, however, attention to context is important because historic preservation and design review are often used by municipalities as another way of keeping housing prices high and preventing unwanted development.
So how much weight should courts give in the dialectical inquiry to the local interest in regulating land use? Under the CalFed standard, as long as the state is acting to address a statewide concern and the means the state has chosen is reasonably related to that concern, the local interest is largely immaterial. Presumably, the local interest in land use regulation is protected by the requirement that the state enactment must not be any broader than its interest. To be sure, there is some language in CalFed suggesting that a conflict between the state and local interests may be resolved by determing which interest is “more substantial,” but the court expressly disclaims such a “weighing” of competing interests in favor of the “substantially coextensive” test.
Admittedly, there is some contradictory language in the caselaw regarding whether the court’s role in a preemption inquiry is to balance the respective interests of the state and local governments, or whether the matter must be resolved in favor of the state once the state has asserted a statewide interest and enacted measures that are reasonably tailored to advance that interest. For the sake of argument, then, it is useful to consider the relative strength of the local interest in regulating land use as opposed to the state’s interest in addressing a statewide housing crisis. The case for local control typically boils down to two arguments. First, every locality’s land-use conditions are unique, and only local governments have the local knowledge necessary to tailor land-use decisions to local conditions. Second, because local governments are closer to the people, they can more effectively represent the interests of their constituents. It is difficult to evaluate these arguments in a vacuum, outside the context of specific legislation, but, at least in the context of state efforts to address a severe housing shortage, they are unlikely to be convincing.
The first argument local governments often make is that land use decisions require sensitivity to unique local conditions that only local governments possess, rather than the “top-down” or “one size fits all” approach of a state mandate. This argument is superficially attractive, but it actually gets things backwards. While there is of course some variation among local zoning ordinances, there is a surprising amount of uniformity in local zoning laws’ treatment of housing. For the past century, ever since the U.S Supreme Court declared apartment buildings to be “parasites” in single-family home districts, cities across the country have treated single-family home districts as inviolate and multi-family housing as if it were a plague. It is commonplace for zoning ordinances to bar or severely limit every type of housing other than single-family homes. Furthermore, cities generally eschew “by-right” zoning for multi-family housing in favor of multi-year discretionary processes that require developers to follow vague standards and ensure a long, expensive and unpredictable path to approval. Ironically, local zoning control is itself a one-size-fits-all straitjacket. Conversely, state legislation that aims to loosen zoning restrictions by allowing multi-family housing, would actually introduce diversity and counteract the one-size-fits-all character of local land use control.
The second argument, that local governments more effectively represent the will of local people than a more centralized authority, is perhaps more persuasive, but it proves too much. Though it may indeed be true that local governments are more responsive to the concerns of local residents than the state, that is exactly the problem that state preemption is needed to solve. Cities too often protect the interests of their residents at the cost of harming people who live outside the community. Because local officials are elected by local residents, they have an incentive to act solely for the benefit of those residents and ignore the effects of their decisions on outsiders. Indeed, this local parochialism is one of the principal causes of the current housing crisis, as cities are protecting home values and quality of life for local homeowners while increasing housing costs and greenhouse gas emissions, worsening segregation and displacement, and reducing productivity across the state and beyond. State preemption is necessary precisely to counteract self-interested local decisionmaking and ensure that the broader statewide interest is protected.
In most cases, anyway, the conflict between state preemption and local control is a false dichotomy. In practice, almost all state legislation preempting local land use regulation leaves a huge amount of room for local discretion. Consider, as an example, what was considered one of the most ambitious pieces of state land use regulation ever, California’s Senate Bill 50 (S.B. 50). S.B. 50 would have required localities to allow denser housing near transit and in certain communities where jobs and good schools were concentrated. At the same time, though, the bill left ample room for local control. For example, cities were required to loosen zoning regulations to permit denser housing areas only in areas that were already zoned residential, so the state legislation deferred to local judgments about what land was appropriate for residential development. And cities were only required to upzone to a limited density and height, allowing municipalities to determine whether additional densities and heights should be permitted. The bill had no effect on local design or historic preservation controls, or the ability of local governments to assess fees or exactions for new development.
Thus, even if we were to interpret the “narrow tailoring” inquiry as a nuanced balancing test requiring searching judicial scrutiny of the competing interests, the state would still generally prevail in most cases. Indeed, in two recent cases, appellate courts in California determined that a challenged state law was narrowly tailored because it left ample room for the exercise of local control. For example, in Anderson v. City of San Jose, the court held that the state Surplus Land Act, which requires cities disposing of surplus land for affordable housing to make some of the housing units available at designated affordability levels, was sufficiently narrowly tailored. The court reasoned that local governments retained the authority to designate land as surplus and to decide whether to dispose of land for affordable housing; the state law only took effect in the event the local agency made both of those decisions. Thus, the state law did not unduly interfere with local control.
As I have presented it, local land-use control in general embodies the worst of local parochialism. It has all the downsides of parochial decision-making—an exclusive focus on the local at the expense of the regional—while providing few of the offsetting benefits of local knowledge and local diversity that local parochialism should offer. If that is accurate, then the question might be asked why local governments should have the power to zone at all, even in the absence of state preemption. If nothing is truly “local” about zoning, perhaps it should not be considered a local matter on which municipalities have the power to initiate state legislation. I would not go quite this far, however. Recall that the modern approach to home rule is a “dialectical” one, in which local and state power considerably overlap. On this view, just as the state legislature may legislate in areas that have a local dimension, local governments may also legislate in areas that have a statewide dimension, absent state preemption. If a conflict arises between the two, however, the state should generally prevail. In any event, the sort of cavalier statements about “diversity,” “local knowledge,” and “one-size-fits-all mandates” that often get thrown around in the debate about land-use regulation are not particularly helpful or accurate.
C. Caselaw Supporting Local Immunity from State Preemption
For all of the reasons discussed earlier, courts have rightly held that charter cities are not immunized against state preemption of local land-use control. By contrast, it is hard to identify many appellate cases squarely holding that local land-use control is immune from state preemption. Perhaps the case that comes closest is the Colorado Supreme Court’s decision in Town of Telluride v. San Miguel Valley Corp. In Telluride, the Colorado state legislature passed a statute that prohibited charter cities from condemning property outside their territorial limits for parks or other similar purposes. The Supreme Court struck down the statute, holding that the Colorado constitution reserves to charter cities the power to engage in extraterritorial condemnation, and the state therefore could not place limits on the ability of charter cities to exercise that power. According to Daniel Rodriguez and Lynn Baker, Telluride illustrates the proposition that “states are quite limited in their ability to displace local regulations dealing with land.”
However, there is less to Telluride than meets the eye. Article XX of the Colorado Constitution expressly confers on every charter city the power to condemn property “within or without its territorial limits.” The Court simply held that the state could not abrogate a power expressly given to charter cities in the state Constitution. The Court did not even bother undertaking the traditional judicial analysis of determining whether extraterritorial condemnation was a “municipal affair” or whether there was a statewide interest in local control of extraterritorial condemnation because the Constitution had already resolved that question by expressly enumerating extraterritorial condemnation as a power of charter cities. At most, Telluride stands for the limited principle that states cannot abrogate local control over a matter that the state Constitution expressly reserves to charter cities.
Aside from Telluride, the argument that land use is an exclusively local affair is primarily supported by questionable dicta in older cases. As just one example of how this argument generally proceeds, advocates of local control sometimes point to the 1962 case of Fletcher v. Porterfor the principle that land use is an exclusively local affair. In reality, Fletcher does not deal with preemption at all, but the question of whether voters can exercise land-use powers via initiative. In dicta, the court does suggest that planning and zoning decisions are local matters with “no statewide consequences.” However, ten years later in CEEED v. California Coastal Zone Conservation Commission,an appellate panel held that a state law could preempt a charter city’s land use decision-making power and clarified that Fletcher was “not authority for the proposition that planning and zoning are exclusively municipal affairs.” The CEEED court further stated: “Although planning and zoning in the conventional sense have traditionally been deemed municipal affairs, where the ecological and environmental impact of land use affect the people of the entire state, they can no longer remain matters of purely local concern.” The most charitable interpretation of Fletcher is that, in 1962, land use and zoning were thought to have few effects outside local boundaries, but by the time CEEED was decided in 1974 it had become clear that land use was often a matter of statewide concern. As I observed earlier, courts have stressed that matters perceived as purely local at one point in time can become statewide as circumstances change. Indeed, the early 1970s were a period when the extralocal impacts of local land use regulations were becoming evident. During this time, state legislatures as well as state courts became increasingly assertive in restricting local land use powers, and in doing so they often observed the extralocal impacts of local land use regulation. In fact, in 1971, the California Supreme Court held that the state could constitutionally preempt local land-use authority because “problems which exhibit exclusively local characteristics at certain times in the life of a community, acquire larger dimensions and changed characteristics at others.” As a result, land use could no longer be considered, if it ever had been, an exclusively local matter.
As an aside, if Fletcher’s almost sixty-year-old dicta were accurate and land use was in fact an exclusively local affair, it would mean that courts would have to invalidate an enormous amount of state legislation dealing with land use adopted since the early 1970s. It is unlikely that courts will want to upend an entire system of land-use regulation that has been crafted and refined over the last generation.
D. The Puzzle of City of Vista
In a recent decision, State Building & Construction Trades Council of California v. City of Vista,the California Supreme Court introduced some confusion into the analytical framework for addressing conflicts between a charter city’s exercise of regulatory authority and the state’s assertion of supremacy. Though Vista is not a case about land use and its application may be relatively limited for reasons discussed below, it is worth examining in some detail because Vista is the California Supreme Court’s most recent pronouncement on the scope of a charter city’s home-rule powers.
Vista held that the state could not require charter cities to pay prescribed minimum wages (prevailing wage) to workers on city construction jobs, finding that the payment of wages for such jobs was a municipal but not a statewide concern. The court’s opinion focused largely on how to determine the relevant statewide concern. Though the court accepted the statewide interest in establishing regional and statewide labor standards, it found that this interest was too “abstract” to justify a state law that would increase a charter city’s labor costs. According to the court, “Autonomy with regard to the expenditure of public funds lies at the heart of what it means to be an independent governmental entity.” Therefore, the state could not merely identify an “indirect effect on the regional and state economies” to justify interference with the city’s ability to spend its own money. What more the state would need to do to satisfy this standard, the court did not say.
The Vista court further reasoned that a statewide interest would more readily be found in cases where the state law has a broad application than a narrow and particularized application, and in cases where the state prescribed procedural rather than substantive standards. On the merits of the case, the court held that the state prevailing-wage law did not address a statewide concern because it was narrowly addressed to the public works projects of public agencies, rather than a general minimum wage law, and imposed substantive, rather than procedural, obligations on charter cities.
Analytically, Vista is a complete mystery and gives little guidance to lower courts. Initially, while admonishing that the state interest cannot be merely “abstract,” the court failed to articulate the level of particularity at which a state interest should be identified or, in other words, how to distinguish an impermissibly abstract state interest from an appropriately particularized one. In holding that the interest in a prevailing-wage law was too abstract, the court reasoned as follows:
the question presented here is not whether the state government has an abstract interest in labor conditions and vocational training. Rather, the question presented is whether the state can require a charter city to exercise its purchasing power in the construction market in a way that supports regional wages and subsidizes vocational training, while increasing the charter city’s costs.
It is far from clear how one would apply this reasoning in other cases. The most plausible reading of this language, as the dissent surmises, is that the asserted statewide concern must be balanced against the municipal interest rather than considered standing alone. That reading makes some sense, but the question of whether the statewide interest is sufficiently important to outweigh the municipal interest in setting wages is entirely different from the question the court purported to answer, which was whether the state had asserted a statewide interest at all. It is essential to keep these questions separate because the statewide interest cannot be balanced against the municipal interest until the statewide interest is first identified.
This analytical confusion then led the court to a significant error. As the dissent pointed out, the court did not actually balance the relevant interests at all, but treated the city’s fiscal autonomy as an automatic trump card, using precisely the sort of “compartmentalization” of matters into fixed spheres that the court has rejected. According to the dissent, the court “simply dismisses the state’s interest as ‘abstract’ without any meaningful evaluation of its factual and historical underpinnings.”
Further, if municipal fiscal autonomy were the trump card that the Vista majority makes it out to be, that principle would invalidate a huge number of state laws as applied to charter cities. As the dissent observed, almost every state law affects the way that cities spend money, and many of them impose substantial additional costs on municipalities. Indeed, in just the past month, an appellate court in California upheld a state law that dictated to charter cities how to dispose of their own surplus lands—a major intrusion into local fiscal autonomy.
Similarly, the court’s broad/narrow and procedural/substantive distinctions hold little water. The assertion that a broad, sweeping law is more likely to be upheld than a narrow, particularized one is puzzling because a broader law by definition will be more intrusive into local affairs than a narrow one. It makes little sense to say that a state law that is more intrusive into local affairs stands a better chance of being upheld against a home rule challenge than one that is less intrusive. Indeed, as I discussed earlier, under California law, part of the dialectical inquiry into the appropriate balance between state and local power is to evaluate whether the state law is “narrowly tailored” to avoid excessive interference into local affairs. It is paradoxical to require both that the law be broad and not narrow, but also narrowly tailored.
The Vista court’s claim that a procedural law is more likely to be upheld than a substantive one is somewhat more defensible, although, of course, a procedural law is generally more “narrow” than one that is substantive and so undercuts the broad/narrow distinction. In any event, in practice, the state frequently preempts substantive aspects of local law, and the substantive nature of the preemption has never been determinative in resolving conflicts between the state and local governments. Indeed, in just the past month, two appellate courts in California have upheld state laws that preempt substantive regulations enacted by charter cities, finding that the substantive nature of the preemption was not a decisive factor.
In sum, Vista is an analytically weak case, so weak that lower courts are already declining to follow it. Vista would probably have little applicability to most land-use cases anyway. Unlike the state’s prevailing wage law at issue in Vista, which the court held rested on the merely “indirect effect on the regional and state economies” of local wage laws, cities directly control the local supply of housing through local zoning regulations and therefore have a direct effect on home prices, vehicle miles traveled, and racial and class segregation. Indeed, in a recent decision, an appellate court in California held that the state had the power to require cities to dispose of surplus land for affordable housing despite the impact on local fiscal autonomy, distinguishing Vista on the grounds that the municipal disposition of surplus land had a direct rather than an indirect effect on the shortage of sites for affordable housing, in light of the “regional spillover effects of insufficient housing.”
IV. Be Careful What You Wish for: A Proposed Ballot Measure to Preserve Local Land-Use Control
Perhaps aware of how precarious their legal position is, advocates for local control of land-use decision-making in California have recently floated the prospect of qualifying a ballot initiative that would constitutionally guarantee local control of land use. In this concluding section, I would like to explain why that idea is extraordinarily bad and will probably have the opposite of the desired effect.
For one thing, while proponents of local control are very loud and forceful, it is not clear exactly how numerous they are among the electorate at large. Public-opinion polling in the last year shows that a majority of Californians want the state to take more aggressive steps to address the housing shortage, even if it means intruding on local control. This is a problem for local control advocates because the initiative process tends to reward breadth rather than depth of support. The risk here is not simply that a local-control initiative could lose at the polls. If such an initiative were qualified, advocates for state preemption would likely attempt to qualify a counter-initiative, perhaps one enacting the failed SB 50 that aggressively preempts local land-use control.
Even if the local control ballot initiative were victorious, however, it could still lose by winning. Local governments would be wise to remember what happened the last time they successfullypassed a ballot initiative to constitutionally preserve local control against state intervention. In 2008, the state of California had a fiscal crisis and eyed the coffers of local redevelopment agencies as a way out. Redevelopment agencies were local-governmental entities controlled by cities that were able to issue bonds to finance the redevelopment of areas determined to be “blighted” and capture a significant portion of the property-tax revenue generated in the redevelopment area. By 2008, redevelopment agencies throughout the state held about $12.9 billion in assets. Legally, however, redevelopment agencies were considered creatures of the state, so when the state demanded that redevelopment agencies hand over a portion of their wealth to cover the state’s debts, the agencies had no recourse—except the ballot box. In response to the state’s threat, the League of California Cities qualified a measure for the ballot in November 2010 called Proposition 22 that would protect local redevelopment money from being forcibly redistributed by the state. The measure passed, but, in an ironic twist, Prop 22 proved not to be redevelopment’s savior, but its undoing. The state legislature responded to Prop 22 by simply abolishing redevelopment altogether, and the California Supreme Court upheld the state’s action. Despite many efforts over the years to revive redevelopment, Governor Jerry Brown and most recently Governor Gavin Newsom have vetoed every redevelopment bill to land on their desk.
The tactical error the League of Cities made was thinking it could simply write a constitutional rule that would reverse the traditional state supremacy over local governments in one discrete area, without regard to the many other ways in which the state can exercise that supremacy and the deference that courts typically give to the state in displacing local authority. In this case, even if local governments were successful in passing a ballot initiative to reserve local control of land use authority, the state would still have many mechanisms at its disposal to ensure that cities comply with state mandates. Most importantly, the state controls most of the money that flows to local governments—especially after the demise of redevelopment, which may be why governors have been reluctant to revive it. Governor Newsom has already discussed plans to tie state funding to compliance with state land-use objectives, and, although he has backed off those plans in the face of local resistance, he would likely be galvanized to follow through on his plans if local governments were to brazenly undermine his authority by constitutionally enshrining local land-use control. And any effort by local governments to obtain local fiscal autonomy via the ballot box would require the Herculean effort of convincing voters to weaken the sacrosanct Proposition 13.
In addition, enshrining local control via the ballot would be counterproductive. Local control may be a winning proposition for affluent cities like Beverly Hills, Newport Beach, and Palo Alto, but it is a loser for many other cities. While local governments enjoy total control over land-use entitlements within their own borders, they have no control over decisions made by neighboring municipalities, regardless of how significant the impacts of one city’s land-use decisions may be upon another. If one city chooses, for example, to approve development that affects traffic in a neighboring town, that neighboring town has no say in the matter. In effect, one city’s “local control” means less local control for another. Hence, at least in some circumstances, cities may affirmatively desire to have local control displaced by state or regional planning agencies. But a ballot initiative preserving local control of land-use decisions would make any kind of regional land use planning difficult, if not impossible. The California experience instructs that any ballot initiative creating permanent structural change only makes government less effective, because such initiatives are inflexible and incapable of responding to changing needs.
Conclusion
Although local control of land use regulation is highly valued by its advocates, it is not constitutionally guaranteed. As it is generally practiced, local land use regulation restricts the supply of homes and thereby raises housing prices, increases sprawl and vehicle miles traveled, worsens homelessness, harms regional economies, and exacerbates segregation by race and class throughout metropolitan regions and states. Therefore, state preemption of local land use control to address these concerns advances a substantial statewide interest and should be upheld against home rule challenges.
