Following in his father's footsteps, Forrest Mozart filed a lawsuit against Palo Alto earlier this month, claiming that the city's affordable-housing program is illegal and amounts to a "special tax" against developers.
Mozart filed his lawsuit just four months after his father, John Mozart, filed a similar suit, arguing that the city is unfairly forcing him to devote 10 percent of his 96-unit "Sterling Park" development on West Bayshore Road to below-market-rate housing.
David Lanferman, the attorney representing both Mozarts, could not be reached for comment Friday.
The younger Mozart's suit pertains to a much smaller project: a 6-condominium "West Meadow Oaks" project on West Meadow Drive. But the argument is the same. Both suits challenge the city's practice of requiring developers to either devote a portion of their projects to below-market-rate (BMR) housing or to pay the city an "in lieu" fee to build affordable housing elsewhere.
The city approved West Meadow Oaks in 2008 with the understanding that the developer would comply with the BMR terms and pay an in-lieu fee. The fee would be 7.5 percent of the project's sales price, which is expected to total hundreds of thousands of dollars.
Though the applicant agreed to the terms, he argues in the lawsuit that he executed the documents "under duress and compulsion." Forrest Mozart's lawsuit also claims that the city "improperly, and without legal or evidentiary justification, arbitrarily set its requirement for payment of the disputed 'BMR in lieu fee,'" -- the same argument his father made when he filed his lawsuit in October.
Forrest Mozart's lawsuit likens the fees to a "special tax" and "an arbitrary and unjustified development exaction." It also claims that that the city's practice of demanding that a fixed percentage of homes in a development be below-market-rate houses "unlawfully required the project to bear costs and burdens necessary for the city to cure its existing perceived deficiencies of 'affordable housing' in the community."
Donald Larkin, Palo Alto's assistant city attorney, said the city is planning to go to mediation to resolve the lawsuit with John Mozart. He said the two lawsuits appear to be very similar in that they go beyond the specific projects and challenge the city's entire below-market-rate ordinance.
"It seems to be a pretty broad-based facial attack on the validity of the ordinance," Larkin said.
The ordinance, which the city adopted in 1974, has been producing 7.5 units of below-market-rate housing a year. In a response to John Mozart's suit, attorney Scott Pinsky wrote that "local affordable housing ordinances are well-established as a constitutional means of addressing both prior exclusivity in housing practices and existing market shortages of affordable housing."
Larkin said the city believes the ordinance is "valid and enforceable." He also said the city is willing to consider any offer the developers make.