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Other legal battles have occurred in California, where many cities have implemented inclusionary zoning policies that typically require 10 percent to 15 percent of units to be affordable housing. The definition of affordable housing includes both low-income housing and moderate-income housing. In California, low-income housing is typically designed for households making 51 percent to 80 percent of the median income, and moderate-income housing is typically for households making 81 percent to 120 percent of the median income. Developers have attempted to fight back these requirements by challenging local inclusionary zoning ordinances through the court legal system. In the case Home Builders Association of Northern California v. City of Napa, the California First District Court of Appeal upheld the inclusionary zoning ordinances of City of Napa that require 10 percent of units of the new development project to be moderate income housing against the Home Builders Association that challenged the City of Napa. Cities have also attempted to impose inclusionary requirements on rental units. However, the Costa-Hawkins Rental Housing Act prohibits cities in California from imposing limitation on rental rates on vacant units. Subsequently developers have won cases, such as Palmer/Sixth Street Properties, L.P. v. City of Los Angeles (2009), against cities that imposed inclusionary requirements on rental units, as the state law supersedes local ordinances.

Citizen groups and developers have also sought other ways to strengthen or defeat inclusionary zoning laws. For example, the initiative and referendum process in California allows citizen groups or developers to change local ordinances on affordable housing by popular vote. Any citizens or interest groups can participate in this process by gathering at least the required number of signatures so that the measure proposed can quality to be on the ballot; once enough signatures are submitted and the ballot measure is cleared by election officials, the ballot measure is typically placed on the ballot for the upcoming election. One recent case is Proposition C in San Francisco. This ballot measure was placed on the ballot for the June 2016 California primary election. Passed in June 2016, this proposition amends the City's Charter to increase the requirement for affordable housing for development projects of 25 units or more.