The Blue Lake City Council, which is down to four members following last month’s abrupt resignation of Chris Firor. | Screenshot from Tuesday’s meeting.



PREVIOUSLY

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California’s Department of Housing and Community Development (HCD) is losing patience with the City of Blue Lake.

Earlier today that agency issued a letter to Acting City Manager Dani Burkhart rejecting the city council’s previously proposed nine-month timeline to adopt an updated housing element that complies with state law.

The city spent years drafting a housing element update that meets statutory requirements, but in March the current iteration of the city council elected not to adopt it. Members of the 3-2 voting majority voiced skepticism about the city’s development plans generally and a mixed-use Danco project in particular. 

Today’s letter from HCD notes that Blue Lake is in violation of state law and says, as a result, the city has lost eligibility to receive a variety of state funds, including permanent local housing funds, infill infrastructure grants, Caltrans sustainable communities grants and more.

The letter also warns of additional financial and legal ramifications. Specifically, Blue Lake could face fines of $10,000 to $100,000 per month for “persistent noncompliance” with state law, with even steeper penalties possible if the state decides to sue. 

“Other potential ramifications could include the loss of local land use authority to a court-appointed agent,” says the letter’s author, HCD Assistant Deputy Director of Local Government Relations and Accountability David Zisser. Jurisdictions that don’t have compliant housing elements are subject to the so-called Builder’s Remedy, which effectively takes away a jurisdiction’s ability to deny any very low- to moderate-income housing and emergency shelter developments that comply with state law.

The letter arrives just three days after the Blue Lake City Council agreed to very slightly shorten its timeline for adopting an updated housing element and completing the necessary rezones. The previously approved timeline was to complete the former task by Dec. 31 and the latter by no later than Feb. 28, 2026. However, HCD wasn’t satisfied by that plan, as the agency made clear in a previous letter, issued on April 30. 

“HCD is requesting the City provide a revised and specific timeline for (1) completing necessary rezones, (2) submitting an updated draft housing element, and (3) obtaining compliance with Housing Element Law no later than May 30, 2025,” that letter said.

At Tuesday’s meeting, the council approved a slight modification, promising to get both tasks completed by Dec. 15 — roughly two weeks earlier than previously promised for the housing element and two and a half months earlier for the rezoning. 

Asked to comment on today’s letter from HCD, Blue Lake Mayor John Sawatzky emailed a written statement saying that the council’s actions on Tuesday “reaffirmed its commitment to achieving compliance with state housing mandates.”

He added that the council authorized staff to seek clarification from HCD on some technical issues, such as the city’s electronic sites inventory, which could allow the process to proceed “more efficiently.” 

Sawatzky also suggested that this latest letter from HCD could have been “part of an automated notification [system],” adding, “we are seeking clarification on that detail.”

Reached by phone, City Councilmember Elise Scafani said that in the past, HCD has been very quick to respond to communications from staff, “So I’m a little concerned that [maybe] they don’t have our revised timeline,” she said. Scafani was under the impression that the revised timeline would allow HCD enough time to review and certify the updated housing element and rezones before the end of the calendar year.

“I think that [new timeline] was a good answer to their request,” Scafani said. “That’s why we picked that date.” At Tuesday’s meeting, Blue Lake City Planner Gary Rees, of SHN Consulting, said that after reaching out to HCD for clarification, agency staff said they wanted the city to move up its timeline for both items (the housing element update and the rezoning) by a month or two, minimum.

Four years ago, Blue Lake received $65,000 through the state’s Local Early Action Planning Grant (LEAP) program, and Scafani said the terms of that grant required the city to use that money to complete its 6th cycle housing element update by the end of the year.

Housing elements are a required component of each local jurisdiction’s general plan, which must be updated periodically to comply with state law. Housing elements in California must be updated every eight years, and they have to show how the local government plans to accommodate its fair share of regional housing needs across income levels, from very low to above moderate. For this latest planning cycle (the 6th), Blue Lake has been tasked with planning for 34 new dwelling units in its updated housing element.

Scafani said it’s possible that the city could adopt that housing element update and complete the required rezoning ahead of schedule — perhaps by October or November. 

“The council is working hard to get all the work done,” she said, and she compared the municipal workload to drinking from a firehose. “We’ve been doing that for months now, and we’re just trying to stand up under the pressure.”

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DOCUMENT: HCD Letter “Blue Lake Noncompliant”