Resources for Community Development, or RCD, the developer of the supportive housing at People’s Park, has pulled out of the project, according to an RCD statement.

The statement noted that the choice was a direct result of a Feb. 24 appellate court’s decision to block UC Berkeley from proceeding with plans to build student and low-income housing at People’s Park. RCD believes the ruling sets a “dangerous precedent” for household development and endangers new affordable housing.

“While the departure of Resources for Community Development from the People’s Park project is disappointing, it is entirely understandable,” said City Councilmember Rigel Robinson in an email statement. “Affordable housing providers cannot be dragged along forever without certainty about project timelines.”

Robinson alleged that RCD’s decision to pull out of the development is the “direct consequence” of advocates seeking to stop campus from building on People’s Park.

The lawsuit brought by Make UC A Good Neighbor and the People’s Park Historic District Advocacy Group against the UC regents is based on the California Environmental Quality Act, or CEQA, a statute which mandates an environmental impact review, or EIR, to inform the public about environmental effects of a project.

Recently, CEQA has come under fire by Berkeley’s city council, campus and officials statewide for blocking campus’s plans for student and supportive housing and for its role in other lawsuits to block developments around the state.

Dan Mogulof, a campus spokesperson, noted that the student and supportive housing projects on People’s Park are separate, adding that RCD’s decision has no impact on the student housing or green space renewal elements. Instead, RCD’s decision to pull out of the development will likely delay the construction and opening of the supportive housing component of the development.

Joe Liesner, secretary of the People’s Park Historic District Advocacy Group, said that when campus cut down trees in People’s Park last August, it counted as construction before the environmental review could be conducted for the historic landmark, which is required under the National Environmental Policy Act, or NEPA.

Federal law states an environmental review must be conducted by the “responsible entity” of a federally funded project on any land designated as a registered national historic landmark.

In October, neither the Berkeley Housing Authority nor RCD completed the environmental review process, and the U.S. Department of Housing and Urban Development, or HUD, anticipated that the application for project-based vouchers would be withdrawn, leaving the project without federal funding, according to email correspondence between Liesner and HUD.

Liesner and HUD’s emails also alleged campus further “jeopardized” federal funding for the supportive housing by asserting that the supportive and student housing were not separate projects.

In a brief submitted to the appellate court in February, campus argued it could not consider alternative sites, since the supportive housing is inseparable from the development of housing on People’s Park as a whole.

Thus, an environmental review was required for both the student and supportive housing, according to the emails. The emails further allege that since the university was not willing to delay its projects for the completion of NEPA, no federal funds could be used for the supportive housing.

“Why is this happening now when funds were given up in November or December?” Liesner said. “It’s very likely it has something to do with the financial real estate community conducting this campaign against CEQA and trying to neutralize CEQA. It’s really a terrible injustice to use People’s Park as a whipping dog to try and support this campaign by developers to get easier access to building wherever and whenever they want.”

Federal funding was formally withdrawn late in 2022, according to the HUD emails.

Mogulof noted that there is no current timeline for finding a new developer.

“Requiring developers to consider who will inhabit the housing, and assess how noisy those residents might be, is inappropriate as a type of potential environmental risk requiring study under CEQA and opens a new pathway for costly and time-consuming lawsuits designed to delay and block housing development,” the RCD statement noted.