On March 9, 2016, the Fourth District issued a decision in Preserve Poway v. City of Poway (2016) 245 Cal.App.4th 560, upholding the City’s use of a mitigated negative declaration (MND) in its approval of a small residential project. The appellate court reversed the trial court’s ruling that an environmental impact report (EIR) was necessary because evidence of the project’s potential social impacts were insufficient to trigger the preparation of an EIR.

The project at issue involved subdividing an 11.6 acre property with a horse boarding facility into 12 residential lots. Project opponents and others in the community had enjoyed using the public horse boarding facility, known as Stock Farm, for 20 years. But the owner of Stock Farm decided to close down the facility and applied to the City for approval of the small residential project. The residential development was marketed as “Poway Equestrian Estates,” enticing potential owners with the prospect of boarding up to nine horses per lot. Because residential uses were legally permissible under the existing zoning and there was no evidence of any adverse environmental impacts that could not be mitigated to less than significant levels, the City approved the project under an MND.

Project opponents argued that the California Environmental Quality Act (CEQA) required the preparation of an EIR instead of an MND. The trial court agreed, concluding that there was substantial evidence of a significant impact on the City’s horse-friendly community character. For example, several public commenters expressed that the reason they had moved to Poway was because of the equestrian lifestyle and lamented that closing the stables would take a wholesome and positive activity away from the community’s youth. The members of the Poway Valley Riders Association (PVRA), which owns a 12-acre equestrian facility across the street from the project site, also complained that they would not have any other places to board their horses.

The Fourth District reversed the trial court’s ruling, focusing on the distinction between physical environmental changes and social or economic impacts. The court started by restating the established rule under CEQA that economic and social impacts resulting from a project are not considered significant impacts on the environment. Then the court addressed the extent to which “community character” must be considered under CEQA. Where “community character” involves aesthetic impacts, the court explained that CEQA requires adequate analysis and mitigation of such aesthetic impacts. But the court noted that the “community character” at issue in this case did not involve aesthetic or visual impacts so much as it involved “what is pleasing to the psyche” and the residents’ sense of well-being. The court found that there was no evidence the residential project would be visually out of character with the surrounding land uses because single-family homes could be found to the immediate north, east, and northwest. Ultimately, the court held that CEQA did not require the City to study the project’s potential psychological and social impacts upon the community character.

The court rejected the argument that the level of public controversy should in itself require an EIR to be prepared, citing San Francisco Beautiful v. City and County of San Francisco (2014) 226 Cal.App.4th 1012, 1026. The court also rejected the argument that trucks and horses associated with the equestrian facility on PVRA property across the street from the project site could have negative impacts on future residents of the project, quoting the holding in California Building Industry Association v. Bay Area Quality Management District (2015) 62 Cal.4th 369, 392, that CEQA does not generally require lead agencies to consider the effects of existing environmental conditions on a proposed project’s future users or residents. Finally, the court refused to consider project opponents’ arguments that the MND was deficient as to public safety and biological resources issues because Preserve Poway forfeited those issues when it chose not to cross-appeal.