Cal. Bldg. Indus. Ass’n v. City of San JoseAnnotate this Case
In 2010, the City of San Jose enacted an inclusionary housing ordinance that requires all new residential development projects of twenty or more units to sell at least fifteen percent of the for-sale units at a price affordable to low or moderate income households. California Building Industry Association (CBIA) filed this lawsuit, arguing that the San Jose ordinance was invalid on its face because the conditions imposed by the ordinance constituted “exactions” under the takings clauses of the state and federal Constitutions. The superior court agreed with CBIA and enjoined the City from enforcing the ordinance. The Court of Appeal reversed, concluding that the superior court erred in interpreting the controlling constitutional principles and the decision in San Remo Hotel v. City and County of San Francisco as limiting the conditions that may be imposed by such an ordinance to only those conditions that are reasonably related to the adverse impact the development projects that are subject to the ordinance themselves impose on the City’s affordable housing problem. The Supreme Court affirmed, holding that the conditions that the San Jose ordinance imposes on future developments do not impose “exactions” upon the developers’ property.