Attorney General Bonta Issues Legal Alert on Legislation Authorizing New Civil Penalties for Housing Law Violations

OAKLAND — California Attorney General Rob Bonta today issued a legal alert to help California local officials — such as council and board members, planning directors, city attorneys, and county counsel — understand new requirements of state housing law under Senate Bill 1037 (SB 1037). Authored by Senator Scott Wiener (D-San Francisco) and sponsored by Attorney General Bonta, SB 1037 went into effect on January 1, 2025 and establishes new court-ordered civil penalties for cities (including charter cities) and counties that (1) fail to adopt a compliant housing element and/or (2) fail to ministerially approve a housing development application that state law requires be approved ministerially. In today’s legal alert, Attorney General Bonta includes five hypothetical examples to assist local officials in understanding the practical effects and implementation of SB 1037. 

“Increasing the production and affordability of housing is a top priority of mine. That’s why I created the Housing Justice Team, and that’s why my office regularly works with the Legislature on bills that will help us build housing faster. SB 1037, which I proudly co-sponsored, is one of those pieces of legislation,” said Attorney General Rob Bonta. “This new law imposes bigger financial penalties than ever before when cities and counties deny or delay the homes that Californians desperately need, and the fines will go toward building even more affordable housing. We need every local government to build their fair share of housing, and SB 1037 requires the bare minimum: prepare your housing element on time and follow state law when you receive a housing development application.” 

“Robust enforcement is absolutely critical to ensuring that the bold pro-housing policies California has enacted in recent years translate into actual new homes on the ground. With this legal guidance, cities have everything they need to comply with state housing law—these requirements aren’t surprises for anyone,” said Senator Scott Wiener. “I’m grateful for the Attorney General for being a strong pro-housing champion and using tools like SB 1037 to hold bad actors accountable for exacerbating our housing shortage.” 

Previously, when a court found a locality in violation of state housing law, monetary penalties could only be imposed 60 days, or in some cases up to a year, after a court ordered compliance. SB 1037 provides that: 

• If a court finds, in an action brought by the Attorney General or the California Department of Housing and Community Development, that a city, county, or local agency violated the housing element adoption deadline or ministerial approval requirements set forth in SB 1037, that court must subject violators to a minimum civil penalty of $10,000 per month, and not to exceed $50,000 per month, for each violation, accrued from the date of the violation until the date the violation is cured. 
• When a city, county, or local agency refuses to adopt a legally compliant housing element and also ignores a court order directing them to do so for more than 120 days, a court must impose the maximum penalty of $50,000 per month. In addition, these violators will face serious curtailment of their local land use authority. 
• Any civil penalty levied pursuant to SB 1037 must be earmarked to support the development of affordable housing located in the affected jurisdiction, to be spent within five years of deposit. Cities, counties, and local agencies may not use funds already dedicated to affordable housing to pay for these penalties.

Background on Housing Element

Under the state’s Housing Element Law, every city and county in California must periodically update its housing element to meet its share of the regional and statewide housing needs. Among other things, a compliant housing element must include an assessment of housing needs, an inventory of resources and constraints relevant to meeting those needs, and a program to implement the policies, goals, and objectives of the housing element. Once the housing element is adopted, it is implemented through zoning ordinances and other actions that put its objectives into effect and facilitate the construction of new homes for Californians at all income levels.  

The housing element is a crucial tool for building housing for moderate-, low-, and very low-income Californians and redressing historical redlining and disinvestment. State income limits for what constitutes moderate-, low-, and very low-income Californians vary by county and can be found here. 

Background on Ministerial Approval

Ministerial, or streamlined, approval is where review by public officials, such as local planning staff, is limited to ensuring that a proposed development meets all objective standards in effect at the time that the application is submitted to the local government. If the objective standards are met, the project must be approved, without being subjected to special discretion or personal, subjective judgment in deciding whether or how the project should be carried out.  

Laws requiring ministerial approval include but are not limited to streamlined housing approvals under SB 423 (Wiener, 2023), certain ADUs, duplexes, and lot splits under SB 9 (Atkins, 2021), small lot subdivisions under SB 684 (Caballero, 2023), and affordable housing located in commercial zones under AB 2011 (Wicks, 2022). 

A copy of the legal alert can be found here.