Gov. Newsom Threatens Lawsuit Against City Of Norwalk over Homeless Housing Moratorium

Governor Gavin Newsom and the California Department of Housing and Community Development (HCD) announced on Tuesday that the city of Norwalk has received a notice of violation and a possible lawsuit warning if they don’t reverse their city-wide moratorium on emergency shelters, single-room occupancy (SRO) housing, supportive housing, and transitional housing.

The issue dates back to early last month. In early August, Norwalk was in the midst of updating the city zoning code, as well as performance and development standards. Needing time, the Norwalk City Council approved an urgency ordinance on August 6th, instituting a 45-day moratorium on a citywide moratorium establishing, implementing, or operating new “convenience stores (liquor stores), discount stores, laundromats, carwashes, payday loan establishments, emergency shelters, single-room occupancy (SRO) housing, supportive housing, and transitional housing.”

Norwalk specifically invoked the Housing Crisis Act, a 2019 law that allows for such a ban if there is a threat to public safety and health. While initially only a 45 day ordinance, the Norwalk City Council now hopes to extend it to August of 2025. City officials have pushed for the Council to approve the extension as the ordinance is desperately needed.

“And now staff believes this is a very powerful tool to allow us to better assess and develop potential performance standards, development standards, and the zoning code,” explained Norwalk Interim Community Development Director Alexander Hamilton. “Our zoning code as all of you are aware, is pretty old – it’s from the 90s. There have been some updates, but nothing substantively on a comprehensive basis. So this will allow us to look at those uses and come back to you.”

However, the state struck back this week before the vote. While a 45 day moratorium was acceptable, an almost year long extension was deemed unacceptable by Newsom officials, both due to Norwalk being far behind state housing goals, as well as the city violating multiple state housing laws. In a letter to Mayor Margarita Rios the Norwalk City Council on Monday, the HCD specifically pointed to the city violating the Housing Crisis Act (HCA), the Anti-Discrimination in Land Use Law, the Affirmatively Furthering Fair Housing (AFFH), and the Housing Element Law.

Further, the HCD told Norwalk in the letter that the city has only issued permits for 175 units of the needed 5,034 Regional Housing Needs Allocation (RHNA) slots, going against state allocation needs. HCD Director Gustavo Velasquez said, ” The City of Norwalk’s disingenuous moratorium equates badly needed homes for people struggling the most with liquor stores and payday loans. In doing so, they are harming their own community and blatantly violating a myriad of state housing laws. The only option is to repeal the moratorium and move past this regrettable episode.”

A possible lawsuit

Should Norwalk pass the extension on Tuesday, the HCD warned in their Notice of Violation that if the city doesn’t comply and respond by September 23rd, they will bring this matter to the state Attorney General’s Office, which will trigger a lawsuit.

“At a time when many Californians are struggling to keep a roof over their heads or lack housing altogether, banning new emergency shelters and new supportive housing not just defies common sense — it is unlawful,” said Attorney General Rob Bonta on Tuesday. “Norwalk’s residents, indeed all Californians, should be outraged. If necessary, my office stands ready to take legal action against Norwalk.”

Governor Newsom also backed the state on Tuesday in a press release, adding, “It is unfathomable that as our state grapples with a homelessness crisis, Norwalk would pass an ordinance banning the building of homeless shelters. It is counterproductive and immoral for any community to throw up their hands and say they’ve done enough while they still have people in need. We can’t leave people in dangerous and unsanitary encampments — the city of Norwalk needs to do its part to provide people with shelter and services.”

The state’s threat to sue is far from empty. In recent years, the Newsom Administration has successfully sued both Anaheim and Huntington Beach over similar housing law violations, with other Los Angeles County cities besides Norwalk also being looked at for violations. However, with Norwalk invoking the Housing Crisis Act, and city officials continuing to urge for the extension, Norwalk could be facing the state head on with a decent legal argument.

“The state keeps saying ‘housing, housing, housing’,” said real estate attorney Bryan Sawyer to the Globe on Tuesday. “But Norwalk would have a good legal case against California. Norwalk has laid out their problems and why they need such a moratorium. The state will really need to show how they are violating everything, which will take some doing. But, you know, the state has a lot more resources than just a city.

“This is more of a message by the state if anything. Keep expanding housing. If one city doesn’t do it, then more will. Look at how fast they jumped on those Orange County cities.”

The Norwalk City Council is expected to vote on the ordinance extension during a Council meeting late on Tuesday.