What's at stake?
The City of Fresno has been subject to Builder’s Remedy application since the beginning of last year — which allows the opportunity to build what they want, whenever they want with little-to-no restrictions — due to consistent noncompliance status for a crucial state housing document.
However, no developers have come forward to take advantage of the opportunity. With the City of Fresno expecting to get back in compliance by mid-February, will this current window of opportunity for developers shutter with nothing to show for it?
Last summer, the Fresno City Council rejected a new, market-rate 60-home apartment complex in an affluent northwest Fresno neighborhood — a blemish on the city’s development-friendly reputation.
Because of an obscure state law that takes effect when cities don’t produce a state-approved housing plan to accommodate projected growth, the developer, James Huelskamp, could skirt city approval and build it anyway — if he turns some of the units into affordable housing.
So far, he hasn’t taken advantage of the law, which could likely only last through February – opting instead to sue the city, for now.
Huelskamp did not respond to five requests for comment from Fresnoland.
It’s one of a few penalties from the state that’s supposed to motivate Fresno officials to comply with their demands on the city’s housing plan. Fresno has had a noncompliant housing element since last year — with their latest rejection asking more be done to promote fair housing across the city and community engagement.
The city has also jeopardized access to millions of dollars in housing funds from the state — including a recent grant application for $8 million, a state Housing and Community Development spokesperson confirmed.
The opportunity for developers to exercise the obscure lapse in regulatory approvals only comes once every eight years, and that’s only if circumstances align. For Huelskamp and other Fresno developers, that window is running out — as soon as the state formally approves the city’s housing plan, which is expected in February.
Other developers who spoke with Fresnoland say that the temporary relief, known as the builder’s remedy, doesn’t address their pain points in getting their projects completed.
For an affordable housing developer like Jessica Hoff Berzac — co-owner of UpHoldings — her main obstacle is funding, not land use permits.
“Our problem is we’ve had money pulled,” Berzac said. “There’s just basically not enough money for the deals that are in our pipeline. But they’re not necessarily entitlement related.”
UpHoldings had a development controversially rejected last year by the Fresno City Council, where the council voted to redirect funding for the project — which would have provided supportive housing to formerly homeless people, under California’s Project Homekey program, due to neighborhood complaints.
Money remains the primary challenge for market-rate developers like Reza Assemi, who is working on a few downtown housing projects. He said he’s heard the issue from similar developers.
“Construction costs are through the freaking roof right now,” Assemi said.
“I know what some of the guys are doing, I’m looking at that also myself, is just shelving projects for now,” Assemi later added. “Like, let them get them through permits, and if it still doesn’t make sense, just like, put them on hold because the costs are just crazy right now.”
It’s not that there aren’t plenty of housing projects in Fresno that could use a regulatory boost. An August court ruling found the citywide environmental impact report to be faulty, leaving at least 15 housing projects in jeopardy, according to city documents shared with Fresnoland.
But the builder’s remedy only applies to projects that have some affordable housing, and while it allows developers to skirt local zoning or land use restrictions, it doesn’t allow them to circumvent California’s environmental review process, or CEQA.
Terance Frazier, a Fresno developer, has one of the 15 projects stalled while the city completes a new program environmental impact report – 84 single-family homes for first-time homebuyers on Crystal and Kearney Avenues in southwest Fresno.
Even if he could get approval today, he said the delays due to environmental review and land use approvals have been too costly to keep the project going. The project is slated to come before the Fresno Planning Commission later in January, he said.
“Wood went up, concrete went up — everything went up since we started,” Frazier told Fresnoland. “So now you can lose your funding mechanism and the projects die, especially when we need it the most in some of these tougher areas, like southwest Fresno.”
So where does this law actually work?
The builder’s remedy has been successfully used in more affluent and coastal jurisdictions where local governments have been known to block new housing projects – and where there’s strong market demand for high-end housing.
On paper, the builder’s remedy is a win for affordable housing advocates and developers who may not be able to see new housing developments built without access to an up-to-date, compliant housing element. In practice, however, some developers have used the builder’s remedy as leverage to fast-track other stalled projects that have been previously rejected by jurisdictions.
In 2023 in the City of Santa Monica, a developer submitted a bulk of out-of-the-ordinary proposals they eventually used as a tool to get other, more practical projects approved by the city council. The City of La Cañada Flintridge also attempted to stop Builder’s Remedy projects through litigation last year, but was stymied by quick intervention from California Gov. Gavin Newsom and state Attorney General Rob Bonta.
“If it [Fresno] was a place where people were chomping at the bit to develop, and the local government was hindering that, then you would have already seen builder’s remedy projects,” said Sonja Trauss, executive director of YIMBY Law, a housing advocacy group that tracks state compliance.
But Fresno has Prohousing designation — a status granted by the state, recognizing the city’s willingness to cut red tape for housing developers.
Could developers stand to benefit from the builder’s remedy in a city where the development application process is already streamlined?
“It’s been already a year almost, and it’s qualified for the builder’s remedy this entire time,” Trauss said. “So even though, yes, there are amendments coming up that…are designed to make the builder’s remedy easier to use. I feel like if you haven’t had one so far, the likelihood of having one after January 1 is quite low.”
