Urgent Support Needed: Protect Our Property and Zoning Rights

What began as a local zoning squabble in North Tustin six years ago over the redevelopment of the Tustin Hills Racquet Club (Club) has now critically escalated to a major legal battle on two fronts with statewide consequences—that could have lasting implications for local control and private property rights.

The Club is North Tustin’s only open space recreational facility, serving as a popular hub for tennis, pickleball, swimming, Pilates and community gatherings, benefiting residents all across the County.

The Club was purchased just before COVID by Ranch Hills Partners with the intent to replace the Club with a 37- condominium unit project (Project). North Tustin residents and the Foothills Community Association (FCA) have strongly opposed the Project due to serious concerns relating to fire safety, community impact and its inconsistency with local zoning laws.

The Club History and Battle for its Future Use

The Club, established in 1958, sits on about 6 acres in the hills and has long shared the same zoning as the surrounding Tract 3883—118 single-family homes (Tract). The zoning required half-acre lots for residential homes, and for decades, the Club and the Tract coexisted under this shared regulation.

In the early 1970s, when the Club desired to expand its operations, the Club filed an application to rezone its property to A-1 Agriculture, which would allow the expansion and provide the Club with favorable tax benefits. The County refused to rezone without Tract approval.

The Covenant and Rezone Approval
Negotiations between the Club and the Tract resulted in the parties entering into a written and recorded agreement or Covenant Running with the Land (Covenant), which led to County approval of the rezoning.

The recorded 1974 Covenant restricts future development to ensure that if the Club ever ceased operation, it would not be redeveloped in ways inconsistent with the original zoning.

Senate Bill 330 and the Pressure on Local Government

California Senate Bill 330 (SB 330) was passed in 2019 and declares a statewide housing crisis. SB 330 seeks to address, among other things, California's affordable housing shortage by increasing residential unit development. SB 330 also strengthens the Housing Accountability Act (HAA) by restricting use of local rules to limit housing production.

County Approval of Project

Now, under the pressure of SB 330, the County approved the Project without addressing the enforceability of the Covenant.

Snowball Decision

Two months after Project approval, the California Court of Appeal (Second District) rendered its first decision interpreting SB 330/HAA in Snowball West Investments L.P. v. City of Los Angeles. Snowball involved a 215-unit development in Verdugo Hills with the developer relying on HAA to force the city to approve the project. Sound familiar? Unlike Ranch Hills, the Snowball developer’s application was denied at the local level. Developer appealed. The critical issue on appeal (which is nearly the identical issue decided by the County on the Ranch Hills’ application) was the interpretation of the term “inconsistent” under HAA. In upholding the denial of the Snowball developer’s application, the Appellate Court held that HAA does not abrogate local control. Rather, HAA only applies when a proposed housing development project complies with local zoning and development policies.

Legal Implications for All of California

Two lawsuits are currently in progress:
   1. FCA is challenging the County’s approval of the Project, arguing that HAA should not override local zoning as decided in Snowball; and
   2. Area residents are suing Ranch Hills for breaching the 1974 Recorded Covenant.

The FCA lawsuit has been extensively briefed by both parties; it was initially set for hearing on April 2nd; but, has now been continued by the court until April 30th.

Until recently, the Covenant lawsuit was treading water, mired in procedurally issues; however, this lawsuit is no longer just a Tract matter; last month, the court permitted two developer friendly intervenors into the case: (1) Californians for Homeownership, Inc., and (2) California Housing Defense Fund. The issue now has exponentially expanded. On the table is whether the Covenant (and like agreements and HOA regulations) are against the public policy declared under SB 330. The determination of this issue will have a rippling effect throughout California.

Why We Must Act Now