Newsom: City in LA County that banned shelters can no longer get certain funding

A city in Los Angeles County that recently banned homeless shelters is no longer eligible for state housing and homelessness funds, California Gov. Gavin Newsom said Thursday.
The Norwalk City Council established a moratorium on emergency shelters, certain businesses and supportive housing developments in August, arguing in a staff report that they “may have detrimental effects” on the community. The city ordinance also prohibits convenience stores, laundromats, car washes and payday loan providers.
Last month, the council voted 5-0 to extend the ban another 10 months and 15 days after issuing a temporary version of it weeks earlier. A day later, California’s Department of Housing and Community Development issued a notice of violation to Norwalk that said the ordinance violated several state laws including the Housing Crisis Act. The city was given until Sept. 23 to repeal it.
On Thursday, Newsom announced that Norwalk failed to come into compliance in violation of the state’s housing element law, which sets certain housing building and planning standards for city and county governments. Because of that, Norwalk is no longer eligible for “key state housing and homelessness funds” and cannot deny certain affordable housing projects, Newsom’s office said in a statement.
“Governor Newsom has also announced that the state may sue the city if they refuse to change course,” the statement reads.
CBS News Los Angeles reached out to the governor’s office ffor an estimate of the funds that are potentially being withheld. 
The city of Norwalk did not immediately respond to a request for comment. 
Newsom and California Attorney General Rob Bonta had threatened to take legal action if city officials decided to extend the ban last month. 
“At a time when many Californians are struggling to keep a roof over their heads or lack housing altogether, banning new emergency shelters and new supportive housing does not just defy common sense — it is unlawful,” Bonta said in a statement. “Norwalk’s residents — indeed all Californians — should be outraged.”  
After the city council voted to keep the ban, the state housing department said it was looking at “next steps.”
“HCD has many tools at our disposal to bring about accountability and we are evaluating next steps, including referral to the CA Attorney General,” Pablo Espinoza, the department’s deputy director of communications, said in a statement at the time.
According to the governor’s office, the city of Norwalk has been awarded nearly $29 million for housing and other resources for people struggling with homelessness over the last five years. But the city has failed to meet state goals for providing enough housing, issuing permits for just 3.5% of the housing units it was assigned in the most recent state cycle.
“Norwalk has failed to meet its housing goals, and now has violated state law by banning shelter and other housing for those experiencing and at risk of homelessness despite its failure to build enough housing,” the governor’s office said in a statement.
Last month, local residents spoke before the city council ahead of its vote on the ban and urged city officials not to go through with it, including a woman who said many people were just “one paycheck away from sleeping in their cars.” Others showed support for the moratorium, including a man who said a shelter near his restaurant drew crowds of people loitering outside during the day, which he called “a disaster scene.”