CHICO — It’s official: Valley’s Edge is challenging Chico — the city and its citizens — in court.
Believe in Chico LLC, the ownership group behind Valley’s Edge, filed suit in Butte County Superior Court challenging the legality of the referendums that overturned Chico City Council approval of plans for the property.
The city got served Wednesday with a certified copy of the litigation officially filed March 20.
Believe in Chico v. City of Chico “addresses the conflict between state housing law designed to help the housing crisis and the public’s right to vote on local development projects,” according to a statement from the group, which also said it “respects the city’s planning process.”
The statement continued: “This lawsuit aims at securing the rights afforded under (state Senate Bill 330, the Housing Crisis Act of 2019). In 2018, California ranked 49 out of 50 states in housing units per capita, and Governor (Gavin) Newsom called for 3.5 million homes to be built. This lawsuit aims to ensure the City of Chico works within the framework of SB 330 to serve the community’s housing and job needs while complying with state law.”
City Manager Mark Sorensen confirmed the city’s receipt of the court summons and offered further context, along with references for SB330 and the referendums. In the March 2024 primary, by roughly 2-to-1 margins, Chico voters approved Measure O and Measure P, thereby overturning decisions by the City Council to adopt the Valley’s Edge Specific Plan and amend the general plan accordingly.
“The legal action seeks to reinstate the city’s project approvals related to the Valley’s Edge development project, which were subsequently reversed by referendum,” Sorensen said in an email Thursday morning. “The lawsuit alleges that the actions taken by the referendums violate California Housing Crisis Act — Government Code § 66300 — and are therefore null and void, and that the project approvals remain in place.
“However, there are legal questions that will need to be resolved by a court of law.”
Councilors will confer with counsel during closed session of the April 15 meeting, Sorensen added, “to review and discuss the lawsuit and how the city will respond appropriately through the legal process.”
Jackson D. McNeill, the lead attorney for Believe in Chico, told this newspaper Thursday that the city has 30 days to respond, “then we’re off to the races. Our client and our firm will vigorously address any arguments they make in their answer or demur.”
Butte County Judge Stephen Benson is assigned to the case and set the first proceeding, a case management conference, for Sept. 10.
Background
Believe in Chico initiated its complaint by filing a claim against the city, announced Feb. 18 as the council convened in closed session about it.
In his letter accompanying the claim, McNeill asserted, “Here, but for the referendums, the Valley’s Edge project — with 2,800 units of housing — would be able to proceed in a manner consistent with the city’s general plan. Furthermore, under the current zoning for the claimant’s property, housing is not permitted absent a specific plan. Thus, the referendums place a limitation on housing in violation of the Housing Crisis Act.”
This is the thrust of the lawsuit, too, along with the assertion that SB330 “explicitly applies to the electorate exercising its referendum power” to block a project that qualifies under provisions of the state law.
As such, in this sense, “City of Chico” does not simply mean the governmental entity; “the city includes the electorate,” McNeill explained.
In announcing the claim, Believe in Chico cited a trial court decision in Southern California as a basis for its position. A San Diego County Superior Court judge ruled in NRF Project Owner LLC v. City of Oceanside that a ballot measure blocking a project amounted to “a development policy, standard or condition” that the law precludes.
That is a point of conversation as opposed to a legally defined comparison, however, as a settlement precluded an appellate court ruling that would have set a precedent for other courts to follow.
Organizers of the Oceanside measure appealed that 2021 ruling in August 2022 but dismissed their appeal a month later. In California, appeals courts and the state Supreme Court set legal precedents, not trial courts, so the superior court ruling is not binding should the Valley’s Edge issue yield litigation.
“In that case, the trial court ruled in favor of the developer on essentially the same grounds we’re raising here,” McNeill said. “I’m sure the city attorney might dispute that; there are some different factual issues. But it’s just good evidence that trial courts in California, when looking at this issue, would likely rule in a developer’s favor.”
Organizers of the referendum, a coalition of local groups that include plaintiffs in an earlier case challenging Valley’s Edge, did not respond to requests for comment before the article’s publication.
