California's housing department says the Stanislaus County city of Patterson may have violated state law when it blocked a 700-home subdivision earlier this year, warning the city it could face action from the state attorney general.

The California Department of Housing and Community Development sent a Sept. 22 letter to city leaders after the council voted in April to reject the Keystone Ranch project, a 95-acre development within the Zacharias Master Plan area.

The letter said Patterson failed to make the required findings under the state Housing Accountability Act before denying the project.

The city, however, argues its decision stemmed from new restrictions imposed by state water regulators. The Department of Water Resources ordered Patterson to cut groundwater pumping by 10% after

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