Tag: Baseline

SECOND DISTRICT FINDS QUANTIFICATION OF EXISTING WATER RIGHTS NOT REQUIRED UNDER CEQA FOR WATER DIVERSION AND STORAGE PROJECT

On March 3, 2022, the Second District Court of Appeal ordered published its decision in Buena Vista Water Storage District v. Kern Water Bank Authority (2022) 76 Cal.App.5th 576, in which the court held that an EIR for a project to divert and store unappropriated flood flows need not quantify all existing water rights. The court also held that CEQA does not require the project description to specify the exact amount of water that would be diverted, since that amount will vary from year to year based on the weather. Additionally, the court held that substantial evidence supported the EIR’s conclusion that the project would not adversely affect the long-term recovery of the groundwater basin in which it is located, as the project would cause a net benefit to the aquifer.

Factual & Procedural Background

Although the Kern River had been designated a fully appropriated stream for many years—such that only those who held an appropriative right could divert from it—in 2010, the State Water Resources Control Board (SWRCB) found that in certain wet years, Kern River water was available in excess of the amount appropriated. In particular, following construction of the Kern River-California Aqueduct Intertie in 1977, the Kern River water master began occasionally releasing reservoir water into the intertie to alleviate flooding. This release only occurs when flows are in excess of those held by existing water rights holders. The SWRCB concluded that this flood-released water was unappropriated and stated that it would allow applications to appropriate that water.

Respondent, the Kern Water Bank Authority, thereafter filed an application with the SWRCB seeking a permit for a water right to divert and store up to 500,000 acre-feet-per-year of the unappropriated water. The Authority also certified an EIR for the project. Buena Vista Water Storage District filed a petition for writ of mandate, seeking to set aside the Authority’s certification of the EIR and its approval of the project.

The trial court granted Buena Vista Water Storage District’s writ petition, holding: (1) the EIR’s project description was inadequate because it did not quantify existing water rights and it was unstable; (2) the EIR’s discussion of the existing baseline was inadequate because it did not quantify competing existing rights to Kern River water; and (3) the EIR’s impact analysis was inadequate because it did not adequately assess impacts on senior rights holders and impacts on groundwater during long-term recovery operations. The Court of Appeal reversed, concluding that the EIR complied with CEQA.

The Court of Appeal’s Opinion

The EIR’s Project Description is Accurate and Stable

Unlike the trial court, the Second District Court of Appeal held that the EIR’s project description is adequate under CEQA. As explained by the court, the EIR consistently and adequately describes the project as “‘high flow Kern River water, only available under certain hydrologic conditions and after the rights of senior Kern River water right holders have been met, that otherwise would have (1) been diverted to the Intertie, (2) flooded farmlands, or (3) left Kern County.’”

Buena Vista Water Storage District argued that the EIR’s project description is unstable because it relies on an “open-ended limit of ‘up to 500,000 [acre-feet] of water.” The court rejected this argument, explaining that a precise amount of water to be diverted by the project cannot be determined because water availability will fluctuate from year to year. As stated by the court: “A project description may use a flexible parameter when subject to future changing conditions.” Furthermore, the proposed 500,000 acre-foot-per-year is a finite maximum amount based on historical conditions, thus providing an adequate upper-end of the proposed diversion.

EIR Not Required to Quantify Existing Water Rights

The appellate court also rejected the District’s contention that the EIR’s project description must include a quantification of existing Kern River rights. That amount of detail is not necessary under CEQA Guidelines section 15124, subdivision (c), which requires a “general description” of the project’s technical and environmental characteristics. Moreover, a stream-wide quantification is a complex proceeding conducted by the SWRCB or a court and can take several years (or even decades) to complete. CEQA does not require this type of exhaustive detail.

Similarly, the EIR’s description of the existing environmental setting is not required to include a quantification of the existing Kern River water rights. The EIR satisfies CEQA’s informational requirements by providing measurements of Kern River water historically diverted into the Kern Water Basin and estimating, based on these historic records, how much water the Kern River Bank Authority could have diverted from the basin under baseline conditions. A complete quantification of existing water rights was not necessary to provide these estimates.

Finally, the court found it was clear that existing rights would not be impacted because the SWRCB cannot issue a new permit to divert water that is already subject to existing water rights. Further, the SWRCB expressly allowed processing of water rights applications, like the one at issue, in its Order finding that the water diverted to the Intertie was not fully appropriated. Quantification of the existing water rights was not necessary to evaluate the project’s impacts.

Substantial Evidence Supports the EIR’s Conclusions Regarding Groundwater Impacts

According to the trial court, the project would alter groundwater recovery by making groundwater available for long-term pumping for additional months or years during drought conditions, which, in the trial court’s view, would likely deplete groundwater during a drought. The Second District rejected the lower court’s analysis as factually inaccurate. The purpose of the project is to add to groundwater supplies and increase the availability of groundwater storage. The EIR concludes that the project would raise the local groundwater, resulting in a net increase in aquifer volume. Additionally, the Kern Water Bank Authority’s existing groundwater and monitoring policies will ensure that banking additional groundwater will not lower groundwater tables or affect the production rate of existing wells. Thus, substantial evidence supports the EIR’s conclusion that the project’s groundwater impacts will not be significant.

Conclusions & Implications

The Second District’s decision addresses whether an EIR for a water diversion and storage project must quantify the existing water rights to the underlying waterbody. In holding that such quantification is not required for the Kern Water Bank Authority’s proposed water diversion project, the Court of Appeal adhered to the principle that CEQA does not require an exhaustive analysis, but rather a good faith and reasonable effort at full disclosure. The decision also recognizes that for certain types of projects, particularly those involving water supplies, a project description must be somewhat flexible. The decision illustrates how a court reviewing an EIR must defer to the lead agency’s factual analyses and conclusions—deference that the trial court had failed to give to the Kern Water Bank Authority’s determinations.

– Laura Harris Middleton

Third District Court of Appeal Holds that the County Relied on the Incorrect Prior EIR in Subsequent Review for a Partial Road Abandonment

On August 17, 2020, the Third Appellate District in Martis Camp Community Association v. County of Placer (2020) 53 Cal.App.5th 569 reversed the trial court’s decision in part and found that Placer County abused its discretion when it approved a partial road abandonment because it relied on the incorrect prior EIR for its addendum and therefore could not accurately determine whether a supplemental or subsequent EIR was required. The court, however, affirmed the lower court’s rejection of the petitioners’ claim that baseline conditions should include the existing but disallowed use of the road along with other non-CEQA claims.

Background

In early 2005, the Placer County Board of Supervisors approved two residential developments and certified their final EIRs—the Martis Camp and the Retreat projects. Martis Camp consists of 650 homes on 2,200 acres just south of State Route (SR) 267 and west of Northstar ski resort. The Retreat consists of 18 homes on 31 acres just east of Martis Camp and within the larger Northstar development. The main roadway connecting Martis Camp to SR 267 is Schaffer Mill Road, a private street that dead-ends at Martis Camp’s southeastern shared boundary with the Retreat. On the other side of that boundary is Mill Site Road, a public road that ultimately connects to Northstar Drive and Northstar ski resort. As initially planned in the 2003 Martis Valley Community Plan, an emergency access roadway with gated access was constructed between Schafer Mill Road and Mill Site Road. The Martis Camp conditions of approval required the developer to construct  this emergency access roadway, provide the County with access for emergency and transit vehicle use, and place signage notifying traffic coming from Schafer Mill Road that the roadway and gate were for “Emergency Access Only.” The Retreat conditions of approval included construction of Mill Site Road and required Retreat property owners to fund road maintenance and snow removal services because such services represented a “‘special benefit’” to them as the sole approved users of the road. At some point around 2010, Martis Camp residents began regularly using Mill Site Road as a more direct route to Northstar in an effort to bypass SR 267. This use coincided with the Martis Camp developer replacing the manual gate with an automatic one that operated by transponder, issuing transponders to Martis Camp property owners, and removing emergency access signage. Retreat residents quickly complained to the County about this use, and in response the Director of the Community Development Resources Agency issued letters in 2011 and 2012 stating that Martis Camp residents have the right to use this road as “owners of property abutting a pubic roadway.” In 2013, Retreat property owners filed a lawsuit to enforce the prohibition on the use of Mill Site Road by Martis Camp residents. That litigation, separate from this case, resulted in the trial court sustaining the County’s demurrers, but on appeal, the court reversed and remanded for the trial court to consider the CEQA claims.

In 2014, Retreat residents petitioned the County to abandon its public road easement rights in Mill Site Road (and a nearby cul-de-sac) and dissolve the associated maintenance benefits. In 2015, the Board approved the petition requests by partially abandoning the road but reserving an easement for public transit and utility services as well as for emergency access and a multipurpose public trail. In approving the road abandonment, the County prepared, and the Board relied on, an addendum to the Martis Camp EIR. The County initially considered relying on the Retreat EIR, but concluded that the Martis Camp EIR was the appropriate environmental document for its subsequent CEQA review because road abandonment would, in effect, “restore traffic patterns to those that were envisioned by the Martis Camp project and analyzed in its EIR.” .

Martis Camp property owners and the Martis Camp Community Association (MCCA) filed petitions for writ of mandate challenging the County’s actions and alleged that the County violated CEQA when it improperly: (1) relied on an addendum to the Martis Camp EIR instead of the Retreat EIR; (2) prepared an addendum instead of a supplemental EIR; and (3) used a baseline that omitted existing use of the road by Martis Camp residents. Other non-CEQA claims alleged that the County violated statutory standards for abandoning Mill Site Road and violated the Brown Act by improperly modifying project conditions of approval without proper notice. Amended petitions asserted “causes of action for inverse condemnation.” After consolidating the two petitions, the trial court sustained without leave to amend a demurrer on the inverse condemnation claim for Martis Camp property owners, but overruled the demurer with respect to MCCA and bifurcated it from other claims. The trial court then denied all other claims. Petitioners appealed.

CEQA Claims

Discussed below, the Court of Appeal reversed the trial court as to the first and second CEQA claims and affirmed the third and remanded to the County for additional consideration.

Addendum Prepared for Wrong EIR: The court held that the County’s decision to prepare an addendum for the Martis Camp EIR was “not supported by substantial evidence” and that its failure to consider whether the abandonment of Mill Site Road would require major revisions to the Retreat EIR was a prejudicial abuse of discretion, largely because the road “was not part of the Martis Camp project; it was part of the Retreat project.” The County had argued that road abandonment was a change in circumstances surrounding the Martis Camp project such that further environmental review for that project was appropriately triggered. But, the court pointed out that only “a further discretionary decision” on a project triggers subsequent CEQA review and because Mill Site Road is not a part of the Martis Camp project, there was no related discretionary action. As further support, the court cited to the finding that conditions of approval “prohibited” Martis Camp residents from regularly using the road. The court did concede, however, that the County’s approach was “reasonable from the perspective of informed decisionmaking.” Nevertheless, the County “should have looked to the Retreat EIR” when assessing the need for further environmental review.

Supplement or Subsequent EIR May Be Required: The petitioners argued that the County should have prepared a supplemental or subsequent EIR for the Mill Site Road abandonment instead of just an addendum because of “more and severe environmental impacts by forcing Martis Camp residents to use SR 267 to reach Northstar.” The court agreed with the petitioners, but did not address the substance of this claim because of the County’s improper reliance on the Martis Camp EIR. Instead, it generally found that the County had “prejudicially abused its discretion” when it relied on the wrong EIR to conclude that no subsequent or supplemental EIR was required.

In Supplemental Review, “Baseline” is the Approved Project: The court rejected the petitioners’ claim that the baseline should have included the existing use of Mill Site Road by Martis Camp residents. Agreeing with respondents, the court found that the petitioners “are conflating” CEQA rules for initial project review under Public Resources Code section 21151 with rules for supplemental review under section 21166. To that end, the court ordered the matter remanded so that the County may first decide whether the applicable EIR “retains relevance despite changes to the project or its surrounding circumstances,” and then consider whether project changes “require major revisions” to the EIR due to “new significant environmental effects or a substantial increase in the severity of previously identified significant effects,” per Public Resource Code section 21166. If it is found that the road abandonment has “rendered the Retreat EIR irrelevant to the decisionmaking process,” then the County must “start from the beginning” under section 21151 and determine whether a new EIR is required.

Other Claims

As a threshold issue, the court concluded that MCCA’s pending, bifurcated inverse condemnation claim did not preclude it from appealing the denial of other claims because the “‘one final judgement’ rule” does not definitively apply when there are multiple parties in a lawsuit. The court then upheld the trial court’s dismissal of the Martis Camp property owners’ inverse condemnation claim and its denial of the remaining non-CEQA claims, discussed below.

No Inverse Condemnation: The crux of the petitioners’ argument was that they have “abutter’s rights to access Mill Site Road” and “by approving the abandonment…the market value of their properties” is reduced, thereby impairing their property rights and effectuating inverse condemnation. However, as noted by the court, Martis Camp property owners do not own property that physically abuts Mill Site Road from whence an inverse condemnation claim can be made. Moreover, any theoretical “nonexclusive easement” granted to Martis Camp residents in 2011/2012 by the Director of the Community Development Resources Agency “does not alter this result.” Therefore, the court affirmed the trial court’s dismissal of this claim.

Abandonment of Road Was Proper: The court started its analysis by noting that two standards of mandate review—ordinary (legislative) mandate and administrative mandate—have been used by courts to decide issue arising from road abandonment. Ordinary mandate is governed by Code of Civil Procedure section 1085 and applies to ministerial acts and quasi-judicial acts and decisions. Administrative mandate is governed by section 1094.5 and applies only to quasi-judicial decisions resulting from a proceeding where there was a hearing, evidence, and agency discretion “in the determination of facts.” Because “the outcome of this appeal would be the same under either standard, the court declined to “enter [the] debate” as to which standard applied. Thus, “for simplicity” it applied the “less deferential” administrative mandate standard that results in an abuse of discretion determination if an agency’s findings are not supported by “substantial evidence in light of the whole record.”

The petitioners argued that the County violated the California Streets and Highways Code when it abandoned Mill Site Road because it did not possess substantial evidence showing that the road was both unnecessary for public use and that abandonment is in the public interest, as is statutorily required. The petitioners then attempted to evidence the road’s public necessity with the fact that it was used regularly by Martis Camp residents and by the County’s choice to reserve emergency and public transit easements as a condition of abandonment. However, the court pointed out the mere “‘convenient’” use of a road does not make it necessary, and that Mill Site Road was “not planned, designed, or approved to accommodate that use.” Further, the court found no authority to support the notion that emergency and public transit easements denote the public necessity of a roadway. To the contrary, the court noted that the statute expressly authorizes “a legislative body to place conditions on abandonment” or to only partially abandon a roadway. The court also found that abandonment was in the public interest because, per the Board of Supervisors’ findings, it conformed with existing planning and environmental documents, protected “the integrity of the traffic management system,” and alleviated the County of the burden of road maintenance—all of which benefited the public.

No Brown Act Violation: The petitioners argued that the County violated the Brown Act when it approved the abandonment of the Mill Site Road because such abandonment altered conditions of approval established by the 2011/2012 letters from the Director of the Community Development Resources Agency and, therefore, should have been included on the agenda for the Board of Supervisor’s meeting per the Act’s noticing requirements. The trial court rejected this argument, and the Court of Appeal agreed, on grounds that the 2011/2012 letters do not override language in the conditions of approval for Martis Camp or the Retreat, which “did not contemplate Martis Camp residents using the emergency access road as a means of ingress and egress from the community.” Also, the court found that the Board was not bound by the Director’s prior enforcement decisions; therefore, the Board’s overruling of those enforcement decisions was not a “‘distinct item of business’” that required separate notice under the Brown Act.

Casey Shorrock

Second District Court of Appeal Upholds EIR for Refinery Project

The Second District Court of Appeal upheld an Environmental Impact Report (“EIR”) for a South Coast Air Quality Management District (SCAQMD) permit for operational changes to two existing refinery facilities. (Communities for a Better Environment v. South Coast Air Quality Management Dist. (2020) 47 Cal.App.5th 588.) Praising both the lead agency and the EIR, the Second District Court of Appeal considered and rejected four arguments made by petitioner. One justice dissented on the issue of baseline.

Tesoro Refining and Marketing Company proposed the Los Angeles Refinery Integration and Compliance Project (“project”), which would integrate two of Tesoro’s oil refining facilities so that Tesoro could more flexibly alter outputs of gasoline and jet fuel, and reduce emissions in order to reduce air pollution and increase compliance. The SCAQMD was required to issue a permit, which allowed the facility to generate more heat, for the project. The court described three key points about the permit: (i) it was a paper change only and did not allow for any physical changes to the heater or other hardware; (ii) it imposed new limitations on emissions; and (iii) it allowed the facility to either process a heavier blend of crude or increase throughput by 6,000 barrels per day, but not both. The project would also shut down a catalytic cracking unit, a major source of emissions.

The SCAQMD prepared and certified an EIR which determined that the project would reduce emissions by 36 percent. The court explained that the analysis of emissions was conservative, in part because the EIR assumed the heater had never operated above 252 million BTUs per hour, when in fact it had. The project also imposed limitations on emissions that did not exist before the project. Although, the project could increase throughput or weight of the crude blend, the facility could have no new emissions under the new permit.

The court cited the following facts as pertinent—the draft EIR included over 1,700 pages; the SCAQMD circulated the EIR for 49 days more than required, for a total of 94 days; the final EIR responded to 1,112 pages of comments with 5,700 pages of responses; the United States Environmental Protection Agency (“EPA”) reviewed the EIR and indicated it had no objection to issuing the permit; and the EIR was “many thousands of pages” with the index alone being 180 pages.

Communities for a Better Environment (“CBE”) challenged the project alleging the EIR was inadequate. The trial court rejected CBE’s arguments and upheld the EIR. On appeal, CBE made four arguments.

Baseline

The court rejected CBE’s argument that the baseline was insufficient under CEQA. The EIR relied on a near-peak 98% baseline, based on an average of the refinery’s worst air pollution emissions during the two years leading up to the project, excluding the top two percent of the data in order to leave out extreme outliers. The EIR compared this 98th percentile analysis with impacts from the project and determined the project would reduce air pollution. CBE argued that CEQA requires an average-value baseline, but the court disagreed. The court emphasized that both peak and average can measure actual situations that truly exist, and there is no one “normal” way to measure the baseline. The court concluded that it was rational, and not “sinister or wrong,” to care most about the worst effects of air pollution, which occur when emissions hit their highest levels. Because EPA relies on a similar approach to regulate air pollution at the federal level, the court concluded the use of the 98th percentile baseline was supported by substantial evidence. One justice, however, dissented because federal custom and practice, which “appear[] to be the only substantial evidence found by the majority,” are not enough to support use of the 98th percentile as the baseline.

Pre-Project Crude Oil Composition

The court also rejected CBE’s argument that the EIR was required to provide the information regarding the existing composition of crude oil at the facility. The EIR explained that in order for the refinery to process a different blend of crude oil, the entire system would need to be changed. The EIR clarified that the project would not make these changes, so the court agreed there was no need to include information regarding the composition of crude oil. The project included a fixed crude operating envelope that would be the same before and after the project, and therefore the court agreed that baseline crude oil data was not necessary.

Failure to Exhaust

CBE argued that the SCAQMD was required to explain how it calculated the amount of additional oil that could be processed with the project. But, the court concluded, neither CBE nor anyone else had raised that exact issue before the SCAQMD, and therefore the issue could not be raised on appeal. The court emphasized that “[m]aking ‘broad’ requests that ‘encompass’ an issue raised on appeal is not raising the ‘exact issue’ during the administrative process.”

Existing Volume of Crude and Refinery’s Unused Capacity

Finally, the court concluded the EIR was not required to disclose the existing volume of crude or the refinery’s unused capacity because this data was immaterial to evaluating the project’s air pollution impact. The EIR explained that in order to increase the crude oil processing rate, the facility would need bigger pipes and stronger pumps. Because the project would not make these changes, it would not increase the refinery’s overall throughput. Data about the existing volume of crude processed and the refinery’s unused capacity, therefore, was not necessary.

Second District Upholds City of Los Angeles’ Determination That EIR Not Required to Assess Population or Housing Impacts for Hotel Project on Site of Vacant Former Apartment Building

In an opinion certified for partial publication on July 22, 2019, the Second District Court of Appeal affirmed the trial court’s decision and held that the City of Los Angeles was not required to prepare an EIR to assess housing-related impacts for a boutique hotel project on the site of a now-vacant former apartment building. Hollywoodians Encouraging Rental Opportunities (HERO) v. City of Los Angeles (B285552; filed 6/28/19, ordered published 7/22/19) ___ Cal.App.5th___ (“HERO”).

The project at issue in HERO is a proposed 24-room boutique hotel in the Hollywood area of Los Angeles. Prior to 2013, the project site was occupied by an 18-unit apartment building that was subject to the city’s Rent Stabilization Ordinance. In 2013, the owner filed a notice of intent to withdraw all 18 units from the rental housing market pursuant to the Ellis Act in order to pursue construction of a condominium project on the site. While the condo project was later abandoned due to a lack of financing, the building never returned to the rental market and remained uninhabited for nearly two years.

In July 2015, the owner of the property submitted a new application to the city, this time seeking to convert the site into a 24-room hotel. The city prepared an initial study for the hotel project. The initial study concluded that, with mitigation, the project would have no significant environmental impacts. With respect to population and housing impacts specifically, the initial study concluded that the project would not displace housing units or residents because the apartments had been withdrawn from the rental market and the building was uninhabited. Accordingly, the zoning administrator adopted a mitigated negative declaration (MND) and approved the project. The zoning administrator’s decision was subsequently affirmed following appeals to the area planning commission and city council.
Following the city council’s approval of the project, three petitioners, including a resident of a nearby building, a former tenant of the apartments, and HERO, filed a petition for writ of mandate challenging the approval. The thrust of the petitioners’ CEQA claims was that the city was required to prepare an EIR to analyze the project’s direct, indirect, and cumulative impacts on the supply of rent-stabilized housing and the displacement of tenants. The trial court denied the petition in full, holding that the city properly concluded the project would have no impact on housing or population because the rental units had been removed from the market and vacated long before the hotel project was proposed. The trial court further ruled that, aside from the baseline issue, the petitioners failed to demonstrate that the project would have a significant effect on the physical environment, and not just socioeconomic impacts.

On appeal, the petitioners’ primary argument was that the city was required to prepare EIR because substantial evidence supported a fair argument that the cumulative effect of the project and other similar projects would be to eliminate rent-stabilized housing units in Hollywood and displace residents that depend on such housing. The Court of Appeal rejected the petitioners’ argument, holding that the proper baseline against which the project’s impact must be assessed is a vacant building, not a tenant-occupied rental property. As the court explained, at the time the environmental analysis for the project commenced in 2015, the property did not include rent-stabilized apartments. Rather, as noted above, the all units had been withdrawn from the rental market in 2013 and the building sat uninhabited since that time. Because these events occurred prior to the project proposal and initial study, the court explained, they were not attributable to the project. Thus, the city properly determined an EIR was not required to analyze such impacts on housing and population. Moreover, the court added, there was nothing in the record to suggest that the 2015 hotel project was a reasonably foreseeable consequence of the initial condominium project for which the apartments were originally removed from the rental market, and there was no evidence that the city was attempting to chop up or evade CEQA review.

Turning to the issue of cumulative impacts, the court held that the city was not required to prepare an EIR to inquire into the cumulative impact of the project on housing and population. Because there was no substantial evidence of a project-specific potentially significant impact, the court explained, the city properly determined that the effects of the project would not be cumulatively considerable and no further analysis was required.

Remy Moose Manley partner Sabrina Teller and associate Christina Berglund represented the Real Parties in Interest in this matter.

Fourth District Court of Appeal Holds City’s Use of Historical Baseline Legally Erroneous

In Bottini v. City of San Diego (2018) 27 Cal.App.5th 281* the Fourth District Court of Appeal upheld the trial court’s ruling ordering the City of San Diego to set aside its determination that the construction of a single-family home required full environmental review.
In February 2011, the Bottini family purchased Windemere Cottage (“Windemere”). At that time, Windemere’s designation as a historical resource was pending before the city’s historical resources board. Shortly thereafter, the board declined to grant historical status to Windemere. In November 2011, the city’s neighborhood code compliance division determined that Windemere constituted a public nuisance and ordered the Bottinis to demolish the structure. They complied. Then in August 2012, the Bottinis applied for a coastal development permit for the construction of a single-family home on the vacant lot. City staff determined that the project was categorically exempt from CEQA, but on an appeal of the determination, the city council ordered a fuller evaluation of the project using a January 2010 baseline, concluding that the demolition of Windemere was part of the project. The council further concluded that the project was not exempt because the unusual circumstances and historic resources exceptions to the exemption applied. In response to the city council’s decision, the Bottinis filed a petition for writ of administrative mandamus seeking to compel the city council to set aside its decision, as well as a complaint alleging constitutional causes of action. The trial court granted the CEQA petition finding that the demolition of Windemere was not a component of the project and therefore the city’s determination that the project is not categorically exempt lacked substantial evidentiary support. It granted summary judgment in favor of the city as to the constitutional claims. The Bottinis and the city cross-appealed.

CEQA
The court of appeal held that an environmental baseline that presumed the existence of the Windemere cottage, which in reality no longer existed at the time the project was proposed, did not accurately reflect the environmental conditions that would be affected by the project. The court dismissed the city’s allegations that the Bottinis “strong-armed” the city into making a public nuisance determination because there was no evidence to support such an allegation. Moreover, the court found that the public nuisance determination confirmed that the demolition permit served a purpose distinct from and not part of the single-family home under review. Thus, the court concluded that the demolition of the cottage could not properly be considered part of the project.

Using the appropriate baseline, the court held that city erred in concluding that the Class 3 exemption did not apply to the project. The construction of a single-family home on a vacant lot is typically categorically exempt. The court further determined that no exceptions to the exemption applied.

Constitutional Violations
The Bottinis alleged three causes of action for violation of the California Constitution’s takings, equal protection, and due process clauses. Regarding the takings claim, the court applied the test set forth in Penn Central Transportation Co. v. New York City (1978) 438 U.S. 104, 124, concluding that the Bottinis did not have a “reasonable investment-backed expectation” because there was no evidence they intended to demolish the cottage when they purchased the property. Even if they had articulated a distinct expectation to do so, there was no basis to conclude that they had a reasonable expectation that they could demolish the cottage to construct a new residence without undertaking any form of environmental review. The court further found that the Bottinis could not sustain a claim for due process because they did not identify any property interest or statutorily conferred benefit of which the city had deprived them. Finally, with respect to equal protection, the court held that the Bottinis did not meet their burden to show that the city’s decision was not rationally related to a legitimate government interest.

  • Review granted, December 19, 2018.

First District Court of Appeal upholds EIR for San Francisco’s Housing Element

On August 22, 2018, the First District issued its decision in San Franciscans for Livable Neighborhoods v. City and County of San Francisco (2018) 26 Cal.App.5th 596. The appellate court upheld an EIR that San Francisco prepared for its 2004 and 2009 Housing Elements, notably rejecting a challenge to the use in the EIR of a future-conditions baseline for the plan’s traffic and water supply impacts.

In an earlier appeal involving San Francisco’s 2004 Housing Element, the First District concluded that the City should have prepared an EIR rather than a negative declaration. By the time the trial court issued an amended writ in April 2009 requiring the preparation of an EIR for the 2004 Housing Element, the City was already in the process of preparing its 2009 Housing Element. Consequently, the City combined the environmental review of the two versions and prepared one EIR for both the 2004 and 2009 Housing Elements. After the City adopted the 2009 Housing Element in June 2011, San Franciscans for Livable Neighborhoods (SFLN) filed a new suit and this appeal followed.

For traffic and water supply impacts, the EIR used a baseline of 2025 conditions based on population projections from the Association of Bay Area Governments (ABAG). The court concluded that the City was “within its discretion to adopt a baseline calculation forecasting traffic and water impacts in 2025” rather than “comparing the existing conditions with and without the Housing Element.” Citing POET, LLC v. State Air Resources Board (2017) 12 Cal.App.5th 52 (“POET II”), SFLN argued that the City took an improperly narrow view of the Housing Element and “sidestepped review of the reasonably foreseeable indirect physical changes in the environment.” The court was unpersuaded because the Housing Element consisted of growth-accommodating policies but did not induce or lead to population growth. Discussing the rule described in Neighbors for Smart Rail v. Exposition Metro Line Construction Authority (2013) 57 Cal.4th 439, the court found that substantial evidence supported the City’s determination that an existing-conditions baseline would be misleading as to traffic and water supply impacts. The court also rejected SFLN’s corollary argument about the baseline for land use and visual resources impacts, noting that the EIR did compare the changes in the Housing Element to the existing environment.

Second, the court tackled SFLN’s challenges to the EIR’s analysis of various impacts. It found that substantial evidence supported the EIR’s analysis, explaining that: (1) the EIR reasonably concluded that the 2009 Housing Element would not result in significant impacts on visual resources or neighborhood character because there would be no changes to allowable land uses or building heights, and residential growth would be directed to areas with existing residential uses; (2) the EIR for the Housing Element was not required to study traffic impacts of specific development projects in the pipeline because those projects were proceeding under their own EIRs or CEQA documents; (3) the EIR for the Housing Element was not required to establish a likely source of water and satisfied CEQA by acknowledging the possibility of a post-2030 water supply shortfall during a multiple-dry-year event and discussing the water rationing plan that would balance supply and demand; and (4) the City did not abuse its discretion in determining that the Housing Element was consistent with ABAG’s Land Use Policy Framework because policies would further the goals of the Framework by placing housing near transit and encouraging infill development.

Third, the court turned to SFLN’s argument that the EIR failed to consider feasible reduced-density alternatives. The EIR analyzed three alternatives, including a No Project Alternative, a 2004 Housing Element Alternative, and an Intensified 2009 Housing Element Alternative. The 2004 Housing Element Alternative was identified as the environmentally superior alternative because it would reduce the sole significant and unavoidable impact (cumulative impact on transit) even though it would not reduce the impact to a less than significant level. The court concluded that this was a reasonable range of alternatives. In particular, the court approved of the City’s explanation in responses to comments that the reduced density alternatives suggested by SFLN would not add any meaningful analysis to the EIR because they would not reduce the project’s potential cumulative transit impacts. The court also found that substantial evidence supported the EIR’s conclusion that the SFLN-proposed alternative dubbed the No Additional Rezoning Alternative was infeasible because increasing the density of two major projects within existing neighborhoods as suggested would require rezoning.

Finally, the court rejected SFLN’s argument that the City should have considered additional mitigation measures to reduce transit impacts. The EIR explained that the only way to eliminate the significant transit impacts would be to increase the number of transit vehicles or reduce transit travel time. Since funding for these measures is uncertain and cannot be guaranteed, the EIR deemed them infeasible. Although SFLN suggested two mitigation measures, one was simply a permutation of the No Project Alternative and the other was infeasible because it involved imposing transit impact fees that the City had already decided would be infeasible because they cannot be guaranteed.

Elizabeth Sarine

OPR Initiates Rulemaking Process for First Comprehensive Update to the CEQA Guidelines in Twenty Years, Affecting Several Areas of Analysis

On November 27, 2017, the Governor’s Office of Planning and Research (OPR) presented the California Natural Resources Agency with proposed amendments to the CEQA Guidelines. As Director Ken Alex noted in his transmittal letter, this is the most comprehensive update to the Guidelines since the late 1990s. Among other changes, OPR’s amendments affect the analysis of energy impacts, promote the use of vehicle miles traveled (VMT) as the primary metric for transportation impacts, and clarify Guidelines section 15126.2 to specify that an agency must analyze hazards that a project may risk exacerbating.

The amendments to the CEQA Guidelines have been shaped by several years of discussion and public comment. OPR began discussions with stakeholders in 2013 and released a preliminary discussion draft of the comprehensive changes to the Guidelines in August 2015. OPR received hundreds of comments on the proposed updates and has provided a document with Thematic Responses to Comments.

One of the most highly-anticipated and impactful changes is the switch from the level of service (LOS) to VMT as the primary metric in analysis of transportation impacts. These updates were required by Senate Bill 743, which directed OPR to develop alternative methods for measuring transportation impacts. Due to the complexity of these changes, OPR has provided a Technical Advisory on Evaluating Transportation Impacts in CEQA to assist public agencies.

Some highlights from the proposed updates include:

  1. Appendix G: adds new questions related to Energy, VMT, and Wildfire;
  2. Guidelines section 15064.3 (SB 743): establishes VMT as the primary metric for analyzing transportation impacts, with agencies having a two-year opt-in period to make the transition easier;
  3. Energy impacts: includes changes to Appendix G and makes clear that analysis must include energy use for all project phases and include transportation-related energy;
  4. Guidelines section 15126.2, subdivision (a): adds the phrase “or risks exacerbating” to implement the California Supreme Court’s holding in California Building Industry Association v. Bay Area Air Quality Management District (2015) 62 Cal.4th 369, requiring an EIR to analyze existing hazards that a project may make worse; and
  5. Guidelines section 15064.4: includes clarifications related to the analysis of greenhouse gas (GHG) emissions to reflect the Supreme Court’s decisions in Cleveland National Forest Foundation v. San Diego Association of Governments (2017) 3 Cal.5th 497 and Center for Biological Diversity v. Department of Fish & Wildlife (2015) 62 Cal.4th 204 (“Newhall Ranch”).

On January 25, 2018 the Natural Resources Agency initiated the formal rulemaking process. From the Agency: The Natural Resources Agency’s proposed updates to the Guidelines Implementing the California Environmental Quality Act are now available.  The proposed changes to the Guidelines and related rulemaking materials are available on the Agency’s website at http://resources.ca.gov/ceqa/.  Public hearings will be held in Los Angeles on March 14, 2018 and in Sacramento on March 15, 2018.  Written comments must be submitted by 5:00pm on March 15, 2018.  Hearing locations, instructions for submitting comments and related information regarding the rulemaking process is contained in the Notice of Proposed Rulemaking.

 

 

 

Fifth District Court of Appeal Approves of Oil Refinery EIR’s Use of Cap-and-Trade Program to Mitigate GHG Emissions, But Disapproves of Kern County’s Reliance on Federal Preemption in Failing to Analyze Off-Site Rail Activities

On November 21, 2017, the Fifth District partially published its decision in Association of Irritated Residents v. Kern County Board of Supervisors (2017) 17 Cal.App.5th 708. The published sections covered arguments about the baseline used for the oil refinery modification project, the mitigation of greenhouse gas (GHG) emissions, and the extent to which federal preemption precludes aspects of CEQA review of project impacts. In reversing the trial court’s judgment denying the petition for writ of mandate, the Court of Appeal upheld the EIR’s treatment of the project baseline and GHG emissions but determined that the county erred in relying on federal preemption to avoid analyzing and mitigating impacts from off-site rail activities.

The project involved modifications proposed by Alon USA to an existing petroleum refinery northwest of the City of Bakersfield. The refinery had undergone several ownership changes since 1932, with Alon USA purchasing it from Flying J and its subsidiary during the latter’s 2008 bankruptcy proceedings. Alon USA sought to expand existing rail, transfer and storage facilities, including the construction of a double rail loop connected to the BNSF railway. The expanded train facilities would allow the transport of crude oil from the Bakken formation in North Dakota to the refinery for processing. The Association of Irritated Residents, Center for Biological Diversity, and Sierra Club filed suit after the County certified an EIR and approved the project.

First, the court dealt with plaintiffs’ arguments about the use of year 2007 as the baseline for air pollution emissions instead of using year 2013 – the year that the County published the notice of preparation. In discussing Neighbors for Smart Rail v. Exposition Metro Line Const. Authority (2013) 57 Cal.4th 439, 457 (“Neighbors”), the court established that it was interpreting Neighbors to only require heightened scrutiny of baselines that use hypothetical future conditions and not of those that use data from past, fluctuating conditions. Based on this interpretation, the court found no error in the County’s use of data from year 2007 because substantial evidence supported this deviation from the “normal” baseline. The court concluded that it was reasonable to include an operating refinery in the baseline because: (a) existing permits and entitlements allow for the processing of up to 70,000 barrels per day; (b) Flying J’s bankruptcy filing in 2008 only temporarily halted processing of hydrocarbons; (c) refinery operations have been subject to prior CEQA review; and (d) the processing of crude oil could begin again without the currently proposed project. The court then turned to whether the County’s choice of year 2007 was supported by substantial evidence, and found that it was because 2007 was the last full year of refinery operations, and was not some hypothetical, maximum authorized amount. The court even included its own calculations of the average barrels per day for the period of 2001 through 2008 to show that the year-2007 figure of 60,389 barrels-per-day was less than the average of 60,994 barrels-per-day.

Second, the court addressed GHG emissions arguments. The court started by analyzing under the de novo review standard a question of first impression: can the volume of a project’s estimated GHG emissions be decreased to reflect the use of allowances and offset credits under the state’s cap-and-trade program? The court concluded that this use of the cap-and-trade program did not violate CEQA because Section 15064.4, subd. (b)(3), effectively directed the County to consider the project’s compliance with the state’s cap-and-trade program as a “regulation[] or requirement[] adopted to implement a statewide . . . plan for the reduction of mitigation of greenhouse gas emissions.” And the court concluded that the project’s compliance with the cap-and-trade program could be part of the substantial evidence supporting a finding of less-than-significant impacts from GHG emissions even though surrender of allowances would not result in the project emitting fewer GHG molecules than if the allowance had not been surrendered. The court explained that the cap-and-trade program was designed so that the “limited allocation and use of allowances means they are not available for use elsewhere” in the state.

In the final published section, the court dealt with federal preemption and off-site rail impacts. Claiming that the Interstate Commerce Commission Termination Act of 1995 (ICCTA) preempted CEQA review, the County had excluded analysis of some of the impacts from off-site main line rail operations that will deliver crude oil to the refinery. The court disagreed. Interpreting the California Supreme Court’s direction in Friends of Eel River v. North Coast Railroad Authority (2017) 3 Cal.5th 677, 722, the court of appeal concluded that the development of information pursuant to CEQA is not categorically preempted but may be preempted on an as-applied basis. Then, as an alternative to that broad legal conclusion, the court considered whether categorical preemption applied to the specific circumstances in this case. It concluded that no categorical preemption applied because analysis of indirect environmental effects “would impose no permitting or preclearance by a state or local agency upon the delivery of crude oil to the project site by a rail carrier,” and “would not control or influence matters directly regulated under federal law.” The court also concluded that there was no as-applied preemption because the environmental analysis of off-site rail activities “would not prevent, burden, or interfere with BNSF Railway’s operation.” Finally, the court directed the County on remand to use the tests stated in this opinion to determine whether particular mitigation measures may be preempted by the ICCTA.

 

 

In a Case of First Impression, First District Court of Appeal Holds That Presentation of Five Alternatives in EIR, Without Designation of One as the ‘Project,’ Does Not Satisfy CEQA’s Requirement for a Stable Project Description

In Washoe Meadows Community v. Department of Parks and Recreation (2017) 17 Cal.App.5th 277, the First District Court of Appeal upheld the trial court’s decision directing the Department of Parks and Recreation and the State Park and Recreation Commission to set aside project approvals where the draft EIR analyzed five alternative projects in detail, but did not identify one preferred alternative.

In 1984, the Department of Parks and Recreation acquired 777 acres of land in the Lake Tahoe Basin—608 acres of the property were designated as Washoe Meadows State Park and the remainder contained an existing golf course. Studies conducted in the early 2000s indicated that the layout of the golf course was contributing to sediment running into Lake Tahoe, which contributed to deterioration of habitat and water quality in the lake.

In 2010, the Department circulated a draft EIR to address the concerns about the golf course. The draft EIR analyzed five alternatives in equal detail, with the stated purpose of “improv[ing] geomorphic processes, ecological functions, and habitat values of the Upper Truckee River within the study area, helping to reduce the river’s discharge of nutrients and sediment that diminish Lake Tahoe’s clarity while providing access to public recreation opportunities ….” The draft EIR did not identify one preferred alternative. In the final EIR, the Department identified the preferred alternative as a refined version of the original alternative 2, which provided for river restoration and reconfiguration of the golf course. In 2012, the Department certified the EIR and approved the preferred alternative.

Framing the issue as a question of law, the court found that the draft EIR did not “provide the public with an accurate, stable and finite description of the project,” because it did not identify a preferred alternative. The court found that by describing a range of possible projects, the Department had presented the public with “a moving target,” which required the public to comment on all of the alternatives rather than just one project. The court determined that this presented an undue burden on the public.

The court compared the draft EIR to County of Inyo v. City of Los Angeles (1977) 71 Cal.App.3d 185, where the court found an EIR insufficient because the project description described a much smaller project than was analyzed in other sections of the EIR. The court in Washoe Meadows found that rather than providing inconsistent descriptions like in County of Inyo, the draft EIR had not described a project at all. Thus, the court directed the Department to set aside the project approvals.