In Working Families of Monterey County v. King City Planning Commission (2024) 106 Cal.App.5th 833, the Sixth District Court of Appeal upheld King City’s determination that a proposed Grocery Outlet store qualified for CEQA’s Class 32 “urban infill” categorical exemption.

Background

In April 2021, Real Party in Interest Best Development Group, LLC applied for permits to develop a Grocery Outlet store in King City.  The project would be located on a 1.6-acre former car sales lot adjacent to Highway 101 and surrounded by commercial buildings, parking lots, a cemetery, vacant land, and the Monterey County Sheriffs’ Department. The project included an 18,187-square-foot building with 72 parking spaces and 13,908 square feet of landscaping.

The City approved the project, finding it exempt from CEQA under the Class 32 “urban infill development” categorical exemption under CEQA Guidelines section 15332.

Project opponents filed a writ petition, alleging that the Class 32 exemption did not apply because the project was not located in an “urbanized area,” and was not an “infill site” because it was not previously developed for “qualified urban uses.”

The trial court denied the petition, finding that the Class 32 exemption does not require a project to be located on an “infill site” in an “urbanized area” as those terms are defined in CEQA. The court also determined that substantial evidence supported the City’s application of the exemption because aerial photographs showed the project site was substantially surrounded by urban uses and met all other Class 32 requirements. Petitioners appealed.

The Court of Appeal’s Opinion

The dispute on appeal was over the interpretation of CEQA Guidelines section 15332, subdivision (b), which provides that a project may qualify for the urban infill exemption if the “proposed development occurs within city limits on a project site of no more than five acres substantially surrounded by urban uses.” Petitioners maintained that, because the Guideline does not define “infill development” or “substantially surrounded by urban uses,” those terms must be interpreted under CEQA’s statutory definitions for “infill site,” “urbanized area,” and “qualified urban uses.” According to Petitioners, based on those respective definitions, the project did not qualify for the exemption because King City is not located in an “urbanized area” and the Project site is not an “infill site.”

After discussing the legislative history of Guidelines section 15332, the court concluded that the State’s regulators did not intend to limit the categorical exemption to infill projects that met the criteria set forth in CEQA’s definitions of “infill site,” “urbanized area,” and “qualified urban uses.” Not only are those terms absent from the plain language of Guidelines section 15332, but the regulatory intent lacked any indication that the population requirements prescribed by CEQA’s definition of an “urbanized area” were intended to limit the types of “cities” where categorically exempted infill projects could be developed.

The court similarly found that the rules of statutory interpretation barred Petitioners’ interpretation of Guidelines section 15332. Because the Guideline omitted specific terms such as “infill site,” “urbanized area,” and “qualified urban uses,” the court could not broaden or narrow its scope by reading into it language that did not appear.

Because the court found no merit to Petitioners’ contention that Guidelines section 15332 should be interpreted by applying CEQA’s statutory definitions of “infill site,” “urbanized area”, and “qualified urban uses,” it held that the City did not err in determining that the Grocery Outlet project came within the Class 32 categorical exemption for infill development.

– Bridget McDonald