By Julia Ingram on December 20, 2018

On Thursday, the University filed a lawsuit against Santa Clara County in both federal and state court against the Inclusionary Housing Ordinance — unanimously approved by the County in September — that requires 16 percent of housing units constructed by Stanford be made available at an affordable housing cost.

As plaintiffs, the University’s Board of Trustees claims that, because the ordinance “targets” Stanford specifically, it violates the Equal Protection clauses of the United States and California Constitutions.

“The issue in the litigation is not about Stanford’s commitment to more affordable housing, but rather that it is unlawful for Stanford to be singled out for unequal treatment in a county ordinance,” University representatives wrote in a public statement.

But in Tuesday letter sent to the County’s legal counsel and obtained by The Daily, the County disputed this rationale.

“The County strongly disagrees with Stanford’s legal arguments regarding the validity of the Inclusionary Housing Ordinance,” wrote James Williams, Santa Clara’s deputy county executive in the letter. “Inclusionary housing ordinances are vitally important tools to ensure that a fair share of housing constructed by a developer is affordable.”

The University’s statement, released Thursday afternoon, emphasized that Stanford filed suit “reluctantly,” and that it hopes to continue to collaborate with the County to devise new terms for its 2018 General Use Permit (GUP), which would authorize the next 17 years of development on Stanford’s campus. The agreement the University hopes to reach, it says, would still encompass “significant additional amounts” of affordable housing.

Joe Simitian, director of the County’s Board of Supervisors, sees the suit as an obstacle to productive negotiations.

“My experience has been when you’re trying to work collaboratively, it becomes much more difficult when folks are facing off in court,” he said. “[The lawsuit] certainly doesn’t help create a collaborative environment for the kind of conversations we’re about to begin.”

In an effort to avoid pressing charges altogether, the University said, it sought to extend the deadline to challenge the ordinance in court while negotiations for the development agreement took place. But because the County rejected the University’s request to extend this Dec. 24 deadline, Stanford chose to pursue legal action while it could.

The County had also hoped to avoid litigation as a result of the development agreement. Williams’ letter, as well as another letter between himself and the County’s legal counsel, explains that the County rejected Stanford’s request for an extension of the litigation deadline because of a Dec. 4 amendment to the ordinance, which added a provision that allows the County to suspend, amend or rescind the ordinance should they approve an alternative regulatory measure through agreement negotiations with Stanford.

“We asked that the County toll the period for filing suit because we believe there is a high probability that we can avoid litigation by arriving at a collaborative, mutually acceptable solution through a Development Agreement,” wrote Barbara Schussman, a managing partner on the County’s legal counsel, in a Dec. 7 letter sent to Williams and obtained by The Daily.

In addressing the demand for affordable housing, the County charged Keyser Marston Associates, a California real estate advisory firm that conducts analyses for cities ranging from San Diego to Cupertino, with conducting multiple studies to determine appropriate affordable housing requirements for new development within the unincorporated area of Santa Clara. It designates Stanford’s campus as one of three “major land use” categories, along with residential and non-residential land.

The Nexus report compiled by Keyser Marston and released last April recommended that the County, “consider a program that applies to all new residential units in the unincorporated County.” Stanford takes issue with the fact that, because the studies have found that all new housing in the County generates demand for affordable housing, the ordinance targets Stanford specifically.

According to the lawsuit, a Jun. 20, 2017 staff report presented to the County’s Board of Supervisors proposed an analysis of affordable housing requirements as pertaining to the 2018 GUP, acknowledging that if a countywide ordinance were passed, Stanford would be subject to it. However, the complaint reads, the staff report did not mention an ordinance specific to Stanford was possible.

“The County has not adopted a countywide affordable housing ordinance and there currently is no proposed countywide affordable housing ordinance under consideration for adoption by the Board of Supervisors,” the document states.

The complaint also claims the County has “taken credit” for some of Stanford’s contributions to the County’s affordable housing supply “for purposes of fulfilling the County’s own legal obligations” to the state of California. According to the document, these include the over $26 million in affordable housing funds the University has provided to the County between 2000 and 2018, and the 800 affordable housing units it has constructed during that same time period.

“Stanford remains committed to pursuing interest-based development agreement discussions with Santa Clara County to explore possible additional community benefits, including support for affordable housing, that could be provided as part of the 2018 General Use Permit,” wrote University spokesperson E.J. Miranda in an email to The Daily.

This report has been updated to include information from the County of Santa Clara’s legal counsel and Board of Supervisor’s director, Joe Simitian.

Contact Julia Ingram at jmingram ‘at’ stanford.edu.