In a major victory for affordable housing and local zoning control, today the California Supreme Court unanimously upheld the City of San Jose’s inclusionary zoning ordinance against a challenge from the California Building Industry Association in California Building Industry Association v. City of San Jose.


In 2010, the City adopted an inclusionary zoning ordinance that required all new residential projects of 20 units or more to sell at least 15 percent of the for-sale units at prices affordable to low- or moderate-income households. The Court held that such an ordinance is a legitimate land use control designed to increase the number of affordable housing units and provide for evenly-distributed mixed-income development throughout the City. By so ruling, the Court makes explicit that inclusionary housing ordinances that require on-site affordable housing are subject “to the ordinary standard of judicial review to which legislative land use regulations have traditionally been subjected,” i.e., are valid if they are “reasonably related” to a “legitimate public purpose.”


This decision means that inclusionary ordinances are more likely to be upheld by the courts in the future, and it provides guidance on how inclusionary ordinances should be analyzed. For more in-depth analysis and discussion, please refer to Goldfarb & Lipman’s Law Alert on the Court’s decision.