Can Cities Run Out the Clock on the Builder’s Remedy? A court in Santa Clara says no way.

A Santa Clara Superior Court judge ruled that Los Gatos improperly tried to block two developers from building new housing in the Silicon Valley city of 30,000. Thanks in part to an amicus brief by YIMBY Law, the court ruled in Town of Los Gatos v. Arya Property, LLC, et al. that the law in California allows developers to make multiple attempts to fix incomplete applications.

At YIMBY Law, we were happy about the ruling for several reasons. Not only did the judge get the law right, but they adopted the reasoning set forth in our brief. Now, not only will those projects move forward, adding hundreds of new units of housing to the city, but the ruling could affect dozens of other cases.

The question before the court was straightforward. If a local government denies a developer’s application to build new housing, what happens next? According to the city, state law should be read to give the developer only one more bite at the apple — a single 90-day window to submit a revision. But according to the developers, the California Department of Housing and Community Development, and us that’s not the case. Every time an application is denied, a new 90-day window opens. In other words, there could be as many windows as it took to either get the project approved or for the developer to change its mind.

In her ruling, Santa Clara County Superior Court Judge Helen E. Williams agreed, and went even further, dismissing the city’s claim that allowing multiple attempts would be harmful: “[T]here is no evidence before the court on this motion of the parade of horribles offered by the Town in the form of developers dragging their feet while infinitely maintaining vesting of their projects or unreasonably extending the process of reaching completeness determinations by manipulation and gaming,” Judge Williams wrote.

It’s an important ruling for many reasons, especially because it closes a potential loophole that local governments could use to deny projects.

This case involved two laws: the Housing Crisis Act, enacted in 2019, which added a new section to the Permit Streamlining Act of 1977. That new section allows a housing developer to submit a preliminary application that freezes (or “vests,” in legal terms) the local zoning and general plan standards for that project. That means that once a project vests, the local government cannot later change the rules that govern it. (You might think of it as similar to the way the U.S. Constitution prevents ex post facto laws, or laws that retroactively make something a crime.)

The part that everyone agrees on is this: After submitting a preliminary application and securing vesting rights for a project, the HCA gives applicants 180 days to submit their development application. The PSA then gives local agencies 30 days to determine whether the application is complete. If they find that it isn’t, the HCA says that the developer has 90 days to complete its application.

Here’s the disagreement. Los Gatos claimed that the HCA required applicants to submit a complete development application within this 90-day period or lose their vesting rights altogether. By contrast, we asserted that the HCA and PSA permit applicants to submit additional development applications after the first 90-day period elapsed, because the second determination of incompleteness would start a new 90-day, as would a potential third, fourth, and so on. 

In the end, the news was good. The court adopted our interpretation.

YIMBY Law’s participation was important, as the court adopted the arguments that we supplied in our amicus brief. The court’s ruling here was the same as what a different court found in 2024 in  Janet Jha v. City of Los Angeles, et al., which YIMBY Law’s attorneys also litigated. There are at least five current cases on the issue in Santa Clara Superior Court alone, and we are optimistic about all of them, especially the two that have the same judge as the Arya case. (YIMBY Law is also a plaintiff in those two cases.) According to one news article, there may be dozens more across the state.

Looking ahead, YIMBY Law will continue to litigate this issue as long as local agencies continue unlawfully stripping applicants of their vesting rights.