On August 23, 2018, the California Supreme Court held, in City of Morgan Hill v. Bushey, __ Cal.4th __ (2018) (Case No. S243042), that a referendum petition to challenge a zoning ordinance amendment that would bring the ordinance into compliance with the county’s or city’s general plan is valid, even though such a referendum would temporarily leave in place zoning that does not comply with the general plan, at least if the local agency has other means to make the ordinance consistent with the plan.  The Court reasoned that such a referendum simply keeps the underlying inconsistency in place for a certain time––until the local agency can make the zoning ordinance consistent with general plan.

The case arose when the Morgan Hill Hotel Coalition, a group of local hoteliers that sponsored a referendum to prevent the City of Morgan Hill from changing the zoning classification from light industrial to general commercial where the landowner sought to build a hotel.  Although the City Council rezoned the land in part to encourage clustering of hotels and generating more business in the community—consistent with general plan land use policies—the hoteliers alleged a concern for reducing the City’s limited supply of industrial land.

The City eventually called a special election to submit the referendum to the voters and, at the same time, approved the filing of a lawsuit to have the referendum nullified as legally invalid and removed from the ballot.  The City and developer claimed the referendum was invalid because, under deBottari v. City Council, 171 Cal.App.3d 1204 (1985), the voter’s rejection of the ordinance would create an inconsistency between the zoning and the general plan’s land use designation for the parcel.

The Coalition in Bushey contended that a referendum that seeks to prevent a zoning change from taking effect does not create an inconsistency with the general plan but merely maintains the preexisting status quo.  The trial court agreed with the City and developer.  The Sixth District Court of Appeal reversed the trial court and held that “a referendum petition challenging an ordinance that attempts to make the zoning for a parcel consistent with the parcel’s general plan land use designation is not invalid if the legislative body remains free to select another consistent zoning for the parcel should the referendum result in the rejection of the legislative body’s first choice of consistent zoning concluded.”  According to the Sixth District, “[t]he Fourth District’s reasoning in deBottari is flawed.”  City of Morgan Hill v. Bushey, 12 Cal.App.5th 34 (2017).  The Sixth District expressly declined to opine, however, on the validity of a referendum petition that would invalidate an ordinance adopting the only available zoning that is consistent with the general plan.

The legal backdrop of this important land use issue is California Government Code section 65860(a), which requires zoning ordinances to be consistent with the relevant general plan.  The courts have described this consistency requirement as “the linchpin of California’s land use and development laws; it is the principle which infused the concept of planned growth with the force of law.”  Accordingly, in the event a zoning ordinance becomes inconsistent with a general plan by reason of amendment to the plan, or to any element of the plan, Government Code section 65860(c) requires the zoning ordinance to be amended “within a reasonable time” so that it is consistent with the general plan as amended.

We wrote about the Bushey decision here, noting that the California Supreme Court would be required to address this untenable split in authority.  We also wrote about a similar case and Attorney General opinion, both of which relied on Bushey, here and here.

The state Supreme Court ultimately granted the City’s and developer’s petition for review and, following oral argument, agreed with the Sixth District.  According to the Supreme Court, a referendum petition can invalidate a zoning amendment approved to create consistency with the relevant general plan, at least where other zoning classifications consistent with the general plan are available.  The Supreme Court thus rejected the City’s and developer’s claim that a referendum to challenge an ordinance intended to align the zoning classification with the general is invalid because it is effectively the same as an initiative causing the zoning ordinance to conflict with the general plan.  To the contrary, the Supreme Court reasoned that rather than “reviving” an inconsistent zoning ordinance, a successful referendum is merely the rejection of an amendment before it takes effect.  In other words, a referendum does not revive inconsistent zoning but rather rejects an ordinance before it becomes law.

While correctly recognizing that the Sixth District’s “decision here constituted a change in the law . . . .” the Supreme Court’s decision arguably does, too, expanding the Sixth District’s holding so as to poke an unfortunate hole in the fabric of the consistency doctrine.  At oral argument, when asked whether a referendum would still be valid even if the general plan would require amendment in order to create consistency between the general plan and zoning ordinance, counsel for the Coalition astutely cited Lesher v. City of Walnut Creek, 52 Cal.3d 531, 541 (1992) for the long-standing and previously unassailable principle that “[t]he planning and zoning law does not contemplate that general plans will be amended to conform to zoning ordinances.  The tail does not wag the dog.  The general plan is the charter to which the ordinance must conform.”  Unfortunately, the Supreme Court apparently missed the import of that bedrock axiom.

The Supreme Court’s misstep appears to stem from sloppy language characterizing the consistency doctrine.  According to the plain language of Government Code section 65860(a), “[c]ounty or city zoning ordinances shall be consistent with the general plan of the county or city . . . .”  This language establishes a clear hierarchy between a general plan and zoning ordinance.  Until now, the state Supreme Court and lower courts have consistently recognized that important hierarchy, which has guided planning and zoning in California for decades.  In Bushey, however, the Supreme Court several times characterizes the consistency doctrine as “making the zoning ordinance and general plan consistent.”  That, of course, is not the same as making the zoning consistent with the general plan, and it seems to explain how the Court muddled its reasoning.

According to the Supreme Court’s logic in Bushey, a “referendum is still valid if the local jurisdiction can create new zoning designations that attain [ ] consistency.  And the local jurisdiction may have other means to achieve consistency between the zoning ordinance and general plan after a referendum—such as by altering the general plan—that would prevent removal of the referendum from the ballot.”  This flawed logic conflates the consistency doctrine, which requires a zoning ordinance to be consistent with a general plan and not the reverse, and is almost certain to lead to unnecessary litigation that should reaffirm that the tail (i.e., the zoning ordinance) does not wag the dog (i.e., the general plan).