522 F.2d 897 (9th Cir. 1975), 74-2100, Construction Industry Ass'n of Sonoma County v. City of Petaluma

Docket Nº:74-2100.
Citation:522 F.2d 897
Party Name:CONSTRUCTION INDUSTRY ASSOCIATION OF SONOMA COUNTY, a California nonprofit corporation, et al., Plaintiffs-Appellees, v. The CITY OF PETALUMA, a California Charter City, Defendants-Appellants.
Case Date:August 13, 1975
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit

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522 F.2d 897 (9th Cir. 1975)


California nonprofit corporation, et al.,



The CITY OF PETALUMA, a California Charter City,


No. 74-2100.

United States Court of Appeals, Ninth Circuit

August 13, 1975

Rehearing and Rehearing En Banc Denied Oct. 2, 1975.

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[Copyrighted Material Omitted]

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Robert T. Anderson (argued), Orinda, Cal., for defendants-appellants.

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Malcolm A. Misuraca (argued), Santa Rosa, Cal., Daniel Wm. Fessler (argued), Davis, Cal., Ronald J. Gilson (argued), San Francisco, Cal., C. Foster Knight, Atty. Gen. (argued), Sacramento, Cal., Martin E. Sloane (argued), Washington, D. C., Donald M. Pach (argued), Sacramento, Cal., for plaintiffs-appellees.


Before BARNES and CHOY, Circuit Judges and EAST, [*] District Judge.

CHOY, Circuit Judge:

The City of Petaluma (the City) appeals from a district court decision voiding as unconstitutional certain aspects of its five-year housing and zoning plan. We reverse.

Statement of Facts

The City is located in southern Sonoma County, about 40 miles north of San Francisco. In the 1950's and 1960's, Petaluma was a relatively self-sufficient town. It experienced a steady population growth from 10,315 in 1950 to 24,870 in 1970. Eventually, the City was drawn into the Bay Area metropolitan housing market as people working in San Francisco and San Rafael became willing to commute longer distances to secure relatively inexpensive housing available there. By November 1972, according to unofficial figures, Petaluma's population was at 30,500, a dramatic increase of almost 25 per cent in little over two years.

The increase in the City's population, not surprisingly, is reflected in the increase in the number of its housing units. From 1964 to 1971, the following number of residential housing units were completed:

1964 ...... 270 1968 ...... 379 1965 ...... 440 1969 ...... 358 1966 ...... 321 1970 ...... 591 1967 ...... 234 1971 ...... 891 In 1970 and 1971, the years of the most rapid growth, demand for housing in the City was even greater than above indicated. Taking 1970 and 1971 together, builders won approval of a total of 2000 permits although only 1482 were actually completed by the end of 1971.

Alarmed by the accelerated rate of growth in 1970 and 1971, the demand for even more housing, and the sprawl of the City eastward, the City adopted a temporary freeze on development in early 1971. The construction and zoning change moratorium was intended to give the City Council and the City planners an opportunity to study the housing and zoning situation and to develop short and long range plans. The Council made specific findings with respect to housing patterns and availability in Petaluma, including the following: That from 1960-1970 housing had been in almost unvarying 6000 square-foot lots laid out in regular grid patterns; that there was a density of approximately 4.5 housing units per acre in the single-family home areas; that during 1960-1970, 88 per cent of housing permits issued were for single-family detached homes; that in 1970, 83 per cent of Petaluma's housing was single-family dwellings; that the bulk of recent development (largely single-family homes) occurred in the eastern portion of the City, causing a large deficiency in moderately priced multi-family and apartment units on the east side.

To correct the imbalance between single-family and multi-family dwellings, curb the sprawl of the City on the east,

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and retard the accelerating growth of the City, the Council in 1972 adopted several resolutions, which collectively are called the "Petaluma Plan" (the Plan).

The Plan, on its face limited to a five-year period (1972-1977), 1 fixes a housing development growth rate not to exceed 500 dwelling units per year. 2 Each dwelling unit represents approximately three people. The 500-unit figure is somewhat misleading, however, because it applies only to housing units (hereinafter referred to as "development-units") that are part of projects involving five units or more. Thus, the 500-unit figure does not reflect any housing and population growth due to construction of single-family homes or even four-unit apartment buildings not part of any larger project.

The Plan also positions a 200 foot wide "greenbelt" around the City, 3 to serve as a boundary for urban expansion for at least five years, and with respect to the east and north sides of the City, for perhaps ten to fifteen years. One of the most innovative features of the Plan is the Residential Development Control System which provides procedures and criteria for the award of the annual 500 development-unit permits. At the heart of the allocation procedure is an intricate point system, whereby a builder accumulates points for conformity by his projects with the City's general plan and environmental design plans, for good architectural design, and for providing low and moderate income dwelling units and various recreational facilities. The Plan further directs that allocations of building permits are to be divided as evenly as feasible between the west and east sections of the City and between single-family dwellings and multiple residential units (including rental units), 4 that the sections of the City closest to the center are to be developed first in order to cause "infilling" of vacant area, and that 8 to 12 per cent of the housing units approved be for low and moderate income persons.

In a provision of the Plan, intended to maintain the close-in rural space outside and surrounding Petaluma, the City solicited Sonoma County to establish stringent subdivision and appropriate acreage parcel controls for the areas outside the urban extension line of the City and to limit severely further residential infilling.

Purpose of the Plan

The purpose of the Plan is much disputed in this case. According to general statements in the Plan itself, the Plan was devised to ensure that "development in the next five years, will take place in a reasonable, orderly, attractive manner, rather than in a completely haphazard and unattractive manner." The controversial

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500-unit limitation on residential development-units was adopted by the City "(i)n order to protect its small town character and surrounding open space." 5 The other features of the Plan were designed to encourage an east-west balance in development, to provide for variety in densities and building types and wide ranges in prices and rents, to ensure infilling of close-in vacant areas, and to prevent the sprawl of the City to the east and north. The Construction Industry Association of Sonoma County (the Association) argues and the district court found, however, that the Plan was primarily enacted "to limit Petaluma's demographic and market growth rate in housing and in the immigration of new residents." Construction Industry Assn. v. City of Petaluma, 375 F.Supp. 574, 576 (N.D.Cal.1974).

Market Demand and Effect of the Plan

In 1970 and 1971, housing permits were allotted at the rate of 1000 annually, and there was no indication that without some governmental control on growth consumer demand would subside or even remain at the 1000-unit per year level. Thus, if Petaluma had imposed a flat 500-unit limitation on All residential housing, the effect of the Plan would clearly be to retard to a substantial degree the natural growth rate of the City. Petaluma, however, did not apply the 500-unit limitation across the board, but instead exempted all projects of four units or less. Because appellees failed to introduce any evidence whatsoever as to the number of exempt units expected to be built during the five-year period, the effect of the 500 Development-unit limitation on the natural growth in housing is uncertain. For purposes of this decision, however, we will assume that the 500 development-unit growth rate is in fact below the reasonably anticipated market demand for such units and that absent the Petaluma Plan, the City would grow at a faster rate.

According to undisputed expert testimony at trial, if the Plan (limiting housing starts to approximately 6 per cent of existing housing stock each year) were to be adopted by municipalities throughout the region, the impact on the housing market would be substantial. For the decade 1970 to 1980, the shortfall in needed housing in the region would be about 105,000 units (or 25 per cent of the units needed). Further, the aggregate effect of a proliferation of the Plan throughout the San Francisco region would be a decline in regional housing stock quality, a loss of the mobility of current and prospective residents and a deterioration in the quality and choice of housing available to income earners with real incomes of $14,000 per year or less. If, however, the Plan were considered by itself and with respect to Petaluma only, there is no evidence to suggest that there would be a deterioration in the quality and choice of housing available there to persons in the lower and middle income brackets. Actually, the Plan increases the availability of multi-family units (owner-occupied and rental units) and low-income units which were rarely constructed in the pre-Plan days.

Court Proceedings

Two landowners (the Landowners) and the Association instituted this suit under 28 U.S.C. §§ 1331, 1343 and 42 U.S.C. § 1983 against the City and its officers and council members, claiming that the Petaluma Plan was unconstitutional. The district court ruled that certain aspects of the Plan unconstitutionally denied the right to travel insofar as they tended "to limit the natural population growth of the area." 375 F.Supp., at 588. The court enjoined the City...

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