Tenants Sue Caltrans, Saying Agency Blocked Them From Buying Homes at Affordable Prices

Three longtime tenants living in state-owned homes along the canceled Interstate 710 freeway extension corridor have filed suit against the California Department of Transportation (Caltrans), alleging the agency unlawfully blocked their ability to buy the houses they live in at affordable prices.

The lawsuit, filed this week in Los Angeles County Superior Court, challenges Caltrans’ use of what the tenants describe as an unauthorized pricing formula that disqualifies low-income residents from purchasing their homes under state law.

The plaintiffs — Pasadena resident Julia Cox and Priscela Izquierdo and Joseph Becerra, both of South Pasadena — live in single-family homes acquired decades ago by Caltrans for the now-abandoned freeway project. They are represented by attorneys Mitchell M. Tsai and Grace M. Holbrook of the Mitchell M. Tsai Law Firm in Pasadena.

The trio claims that Caltrans improperly denied them eligibility to purchase their homes by requiring a “positive” calculated affordable price, a standard they say does not exist in state statute.

The ill-fated 710 extension dates back to the 1960s and 1970s, when Caltrans began acquiring hundreds of homes in Pasadena, South Pasadena and El Sereno for a planned freeway connection between existing segments of the 710.

Many of the properties were taken through purchase or threat of condemnation, displacing families and leaving entire blocks in limbo for decades as the project faced sustained political, legal and community opposition, mostly in South Pasadena.

After years of stalled planning and lawsuits, the extension was abandoned in 2019, leaving Caltrans with surplus residential properties that had been in a state-run rental program.

Many of the homes have fallen into disrepair.

Under the Roberti Act, a law intended to protect displaced and low-income tenants, Caltrans is required to offer surplus residential properties to qualifying occupants at an affordable price once the properties are no longer needed.

The law was triggered after the legislature formally canceled the 710 extension in 2019 and ordered the state to dispose of the properties.

According to the lawsuit, Caltrans determined in late 2024 that all three tenants had a “negative” calculated affordable price, rendering them ineligible to buy their homes under the affordable program.

Instead, Caltrans offered the properties only at fair market value — a price the tenants say is far higher and does not require the state to complete necessary repairs.

The tenants allege Caltrans has failed to disclose how it calculates the affordable price and has not provided a proposed sale price using the method outlined in the Roberti Act or its implementing regulations.

The suit also points to a prior court ruling that invalidated a separate Caltrans pricing policy as an unlawful “underground regulation,” arguing the current practice similarly violates the state Administrative Procedure Act.

According to the lawsuit, the tenants are asking the court to order Caltrans to stop using the disputed pricing requirement, recalculate affordable sale prices and halt sales of the properties to third-party housing entities while the case wends its way through court.

Caltrans is named as the defendant, along with unnamed Does 1-10. So far, the agency had not responded publicly to the lawsuit.