Author Archives: Chris Stiles

FIRST DISTRICT COURT OF APPEAL HOLDS POST-FEIR WILDFIRE IMPACT ANALYSIS LEGALLY DEFICIENT

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In Bonta v. County of Lake (2024) 105 Cal.App.5th 1222, the First District Court of Appeal ruled that the EIR for a proposed luxury resort in an unincorporated portion of Lake County was deficient for failing to provide a timely, project-specific disclosure of increased wildfire risk.

Background

Lotusland Investment Holdings proposed construction of a luxury resort on 16,000 acres in an unincorporated and undeveloped portion of Lake County.  During the public comment period on the Draft EIR, commenters raised several issues, including the discussion of impacts related to wildfire, GHG emissions, and groundwater. The County included additional information in an “errata” after the Final EIR was released. In particular, the errata included a discussion of wildfire risks and additional mitigation for GHG impacts that required the developer to purchase offset credits if feasible.

Several petitioners filed lawsuits challenging the EIR, alleging (among other things) that its analysis of wildfire, GHG, and groundwater impacts was inadequate, and that the Couty improperly rejected feasible alternatives. The trial court ruled that the EIR violated CEQA by failing to consider the project’s impact on the community’s ability to evacuate from a wildfire but rejected the petitioners’ other contentions. The petitioners appealed.

The Court of Appeal’s Decision

Wildfire

First addressing the petitioners’ wildfire arguments, the court noted that CEQA requires public agencies to meaningfully consider and mitigate the potential adverse environmental impacts of their actions and communicate those potential impacts to the public via an EIR. To properly communicate those impacts to the public, the court explained, an EIR must include enough information to allow a person who is unfamiliar with the project to understand and meaningfully consider the potential impacts of the project.

Here, the court found that the EIR failed as an informational document. Specifically, neither the Draft or Final EIR addressed the increase in wildfire risk associated with the Project. Instead, the environmental documents discussed project features that would reduce the wildfire impacts of the Project to a less-than-significant level without explicitly outlining the Project’s wildfire impacts.

The court found that the 11th-hour errata to the FEIR did not remedy this informational deficiency for two reasons. First, the errata was substantively deficient because it only generically identified the sorts of human activities that increase wildfire risk in previously undeveloped areas. Instead, the County should have tailored the wildfire impact discussion to include project-specific analysis focused on the development of a luxury resort in undeveloped and unincorporated Lake County.

Second, the court found that the errata was published too late in the CEQA process to be effective as a tool to inform the public of the potential environmental impacts of the Project. The court found that the County’s process did not allow the public to meaningfully evaluate the potential environmental impacts of the project prior to the certification of the FEIR, which in this case occurred less than a week after the errata was published.

GHG Emissions

The Court of Appeal agreed with the petitioners’ argument that the carbon offset program, which was added to the final EIR via the errata, was legally infeasible by the County’s own rationale: the developer could not guarantee that quality carbon credits would be available to purchase when necessary. However, the court found no authority for the contention that CEQA bars considering potentially beneficial measures that agencies deem too uncertain to be feasible. Importantly, moreover, the environmental analysis did not rely on the offset program to eliminate the project’s impacts, and therefore, any error in including the carbon credit program in Final EIR was not prejudicial.

Groundwater

The petitioners argued that the EIR was legally deficient for failing to calculate the amount of water that the project would draw from an off-site well. The court rejected this argument, finding that the EIR need not speculate as to how much water would be drawn from the well because the EIR clearly stated that the off-site well would only be used in extreme circumstances, and that the project would ordinarily be fully supplied with on-site sources.

D.C. CIRCUIT COURT OF APPEALS FINDS COUNCIL ON ENVIRONMENTAL QUALITY LACKS AUTHORITY TO ISSUE NEPA REGULATIONS

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In an opinion published on November 12, 2024, the U.S. Court of Appeals for the D.C. Circuit in Marin Audubon Society v. Federal Aviation Administration (D.C. Cir. 2024) 121 F.4th 902, found that the Council on Environmental Quality’s (CEQ’s) regulations implementing the National Environmental Protection Act (NEPA) were ultra vires and thus invalid. The court held that CEQ lacked authority to issue such regulations because its rulemaking authority was tied not to a Congressional act but to a presidential Executive Order.

BACKGROUND

The National Parks Air Tour Management Act of 2000 requires the Federal Aviation Administration (FAA) and the National Park Service (NPS) to develop plans regulating tour flights over national parks throughout the United States. Pursuant to the Act, the FAA and NPS issued an Air Tour Management Plan governing tourist flights over four Bay Area, California national parks: the Golden Gate National Recreation Area, Muir Woods National Monument, San Francisco Maritime National Historical Park, and Point Reyes National Seashore. The Agencies determined that they did not need to prepare an environmental analysis under NEPA because the Plan, as compared to what currently existed, would cause little to no additional environmental impacts.

THE COURT OF APPEALS’ OPINION

Several environmental organizations and one area resident petitioned for review of the Plan, arguing that the Agencies violated NEPA and the CEQ’s NEPA regulations. Petitioners argued that the Agencies violated CEQ’s regulations by foregoing an environmental assessment; the Agencies denied the claim and defended their action by invoking the same regulations.

The D.C. Circuit declined to address the merits of these arguments and instead independently held that CEQ’s regulations—which purport to govern how all federal agencies must comply with NEPA—are ultra vires and thus invalid.

Historical Legal Background

The CEQ traces its rulemaking authority not to a legislative act, but to a presidential Executive Order (EO). But because an EO is neither legally binding nor has the force of law, CEQ’s authority to issue regulations raises a separation of powers issue.  NEPA, on the other hand, is a legislative act that Congress adopted in 1969, which requires each federal agency to issue a detailed statement addressing the environmental impact of any proposed major federal action that significantly affects the quality of the human environment. All federal agencies must develop procedures that implement NEPA. The Act also created the CEQ within the Executive Office of the President, to be run by three presidentially appointed Commissioners who are confirmed by the Senate. CEQ’s job is to “review and appraise” agencies’ compliance with NEPA, make recommendations to the President with respect thereto, and develop and recommend to the President national policies to foster and promote the improvement of environmental quality.

In 1970, President Nixon issued an EO instructing CEQ to issue guidelines on how federal agencies should prepare the detailed environmental analyses NEPA required. CEQ subsequently published a memorandum with guidelines for federal agencies to consider when considering or preparing environmental impact statements. At the time, several courts regarded CEQ’s role as “merely advisory” because it lacked authority to prescribe regulations that governed or mandated compliance with NEPA. CEQ, however, held a different view, and considered its NEPA guidelines to be mandatory non-discretionary standards that federal agencies must comply with. The D.C. Circuit in Sierra Club v. Morton (1975) 514 F.2d 856 agreed that CEQ could equivocate its guidelines as legally binding rules that were entitled to great respect and heightened deference.

In 1977, President Carder issued an EO that empowered CEQ to issue “regulations,” as opposed to “guidelines,” which required all federal agencies to comply with CEQ’s NEPA regulations unless doing so would violate federal law. In response, CEQ invoked the EO and “the President’s Constitutional and statutory authority” to issue 92 new regulations, which prescribed uniform standards that were binding on all federal agencies, courts, and NEPA litigants. The framework promulgated by those largely remains in effect today.

CEQ’s NEPA Regulations are Ultra Vires

Based on CEQ’s and NEPA’s historical background, the D.C. Circuit explained that executive agencies, such as the FAA and the NPS, are statutory creatures that have no power to act except to the extent authorized by Congress. Thus, for CEQ’s regulations to be legally binding on those agencies, a nexus must be established between the regulations and some delegation of Congressional legislative authority. In other words, the court must determine whether CEQ, as an executive or independent agency, has statutory authority from Congress to issue its NEPA regulations.

Although CEQ publishes its NEPA regulations in the Code of Federal Regulations, such publication is no measure of the agency’s authority to issue the rules that appear there. Here, NEPA’s provisions provide no support for CEQ’s authority to issue binding regulations. No statutory language states or suggests that Congress empower CEQ to issue rules binding on other agencies—that is, to act as a regulatory, rather than advisory, agency. The court reiterated: “NEPA contains nothing close to the sort of language Congress typically uses to confer rulemaking authority.”

The court also noted that “[n]o statute confers rulemaking authority on CEQ.” The court cited the Environmental Quality Improvement Act of 1970 as an example, which established the Office of Environmental Quality that is headed by the CEQ Chairman. Even as the director of that office, CEQ’s chairman only has the authority to “assist” other federal agencies and may only “promulgate regulations” related to the Office’s funding for research studies and projects.

The court qualified that the Supreme Court’s prior pronouncements on CEQ’s regulations could not rescue them. Although the Court once wrote that those regulations were “entitled to substantial deference,” the statement did not result from the Court’s examination of CEQ’s authority to issue judicially enforceable regulations.

The court further concluded that CEQ’s regulations were not a delegation of the President’s authority under the Constitution’s “Take Care Clause.” While EOs are focused solely on the internal management of the Executive Branch—and thus create no private rights and are not judicially reviewable—NEPA imposes statutory obligations that agencies must execute, which in turn affect private parties who make seek judicial review of those agencies’ actions. The court reasoned: “If all federal agencies are bound by the CEQ regulations and must follow them in carrying out their obligations under NEPA, and if the regulations are enforceable by courts, then those regulations cannot be justified solely as an exercise in a President’s oversight of his Administration.” To this end, the Supreme Court has previously held that the Take Care Clause cannot be used to bypass agencies’ limited status as “creatures of statute” because the Constitution does not permit the President to seize Congress’ lawmaking power by issuing an order that, like a statute, authorizes a government official to promulgate rules and regulations.

Based on these foregoing reasons, the court held that CEQ had no lawful authority to promulgate NEPA regulations that are binding on federal agencies.

– Bridget McDonald

SECOND DISTRICT HOLDS AGENCY’S ADOPTION OF A MODIFIED PROJECT THAT DEVIATED FROM THAT DESCRIBED IN THE EIR DID NOT RENDER THE PROJECT DESCRIPTION UNSTABLE

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In a partially published opinion, Gooden v. County of Los Angeles (2024) 106 Cal.App.5th 1, the Second District Court of Appeal held that the Los Angeles County Board of Supervisors’ decision to prohibit new vineyards as part of an area plan update—a proposal not included in the EIR—did not violate CEQA’s requirement that a project description be accurate, stable, and finite. In doing so, the court applied the de novo standard of review to whether the project description contained an accurate, stable, and finite project description.

Background

The Project was a “comprehensive update” to the North Area Plan (NAP) and Community Standards District (CSD), enacted in the years 2000 and 2002 respectively, to serve as part of the County’s General Plan governing 21,000 acres in an unincorporated portion of the Santa Monica Mountains. The NAP served as a “planning tool” with “area-specific policies”; the CSD was a “zoning overlay” to implement the policies of the NAP.

The County issued a Draft EIR in May 2020 which identified revisions to the NAP and CSD including a proposal to reduce the minimum threshold for when grape-growing would be considered a “vineyard” and therefore subject to more stringent development standards and new standards for pest management. The Draft EIR did not include a proposal to ban new vineyards.  While several commenters expressed support for a complete ban, the Final EIR likewise did not propose a ban on new vineyards. The Department of Regional Planning recommended certification of the Final EIR and approval of the NAP and CSD as proposed.

The Board of Supervisors later certified the Final EIR and approved the Project with one pertinent change: prohibiting new vineyards of any size.

A group of petitioners filed a petition for writ of mandate alleging that the Board’s change to the project rendered the project description unstable and thus violated CEQA. The trial court denied the petition. One of the Petitioners, Gooden, appealed.

The Court of Appeal’s Decision

In the published portion of the decision, the Court of Appeal found that the Board’s adoption of the modified Project did not violate CEQA’s requirement of an accurate and stable project description.

The court first noted that CEQA allows flexibility for agencies to adopt a project that deviates from what was described in the EIR to allow for alterations in response to public feedback – the very purpose of CEQA’s requisite information exchange. However, the court said, when the later deviation is so great that the project description misleads the public, thwarting the public’s ability to participate in the process and comment meaningfully on the project, the earlier description may be unstable and inadequate.

Applying the “de novo” standard of review, the court concluded that the Board’s approval of the project including a ban on all new vineyards did not render the project description unstable. According to the court, the portion of land dedicated to agricultural land use was small within the greater NAP and CSD and constituted a small portion of the project plan, just half of one page of a total 91 pages. The court found it significant that the topic of vineyard regulation was discussed within the plan, preserving the project and its main features. The court noted the while change was significant to new vintners, a different rule would implicate all subsequent changes to a project description.

THIRD DISTRICT UPHOLDS AWARD OF COSTS INCURRED BY RESPONDENT AGENCY FOR PREPARATION OF THE ADMINISTRATIVE RECORD, DESPITE PETITIONERS’ ELECTION TO PREPARE THE RECORD

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In Yolo Land and Water Defense v. County of Yolo (2024) 105 Cal.App.5th 710, the Third District Court of Appeal affirmed the trial court’s denial of a CEQA petition and upheld the County’s memorandum of costs. In the published portion of the opinion, the court upheld the lower court’s award of costs to the County for record preparation, despite the petitioners’ election to prepare the record.

Background

Teichert, Inc. sought permission from the County of Yolo to mine sand and gravel at a 319.3-acre site for the Teichert Shifler Mining and Reclamation Project. Following mining activities, approximately 113 acres of the Project site would be reclaimed to agricultural use with another portion reclaimed to a lake, grassland, and riparian woodland. The project included a proposal to transfer specified tonnage allocations from two of Teichert’s existing mining operations to the Shifler location upon their completion, which are anticipated to cease either on January 1, 2028, or when the maximum amount of permitted removal is reached.

Following the County’s certification of an EIR, and approval of the project, project opponents filed a petition for writ of mandate alleging the County violated CEQA. The petitioners also filed a notice electing to prepare the administrative record under Public Resources Code section 21176.6, subdivision (b)(2). The petitioners then submitted a Public Record Act request to the County, requesting the documents for the record. The trial court denied the petition and awarded the County $3,813.45 for costs it had incurred in facilitating the preparation of the record by the petitioners. The petitioners appealed.

The Court of Appeal’s Decision

In the published portion of its decision, the Court of Appeal upheld the lower court’s award of costs to the County for record preparation.

The petitioners first argued that the respondent agency could not recover costs for preparing the record because the petitioners had elected to, and did, prepare the record in the case. The court, however, held that section 21167, subdivision (b)(2), does not preclude an award of costs to the respondent agency under these circumstances. According to the court, despite the petitioners’ election to prepare the record, the County incurred costs in producing the documents that comprised the record and the agency is required certify the record’s accuracy under subdivision (b)(1).

The court explained that generally, under Civil Code of Procedure (CCP) section 1032, a prevailing party is entitled to recover costs unless otherwise provided by statute. Further, CCP 1094.5, subdivision (a), requires the petitioner to bear the cost of preparing the record unless otherwise specified by statute. According to the court, nothing in section 21167.6 bars a prevailing public agency from recovering those costs.

The petitioners also argued that Couty could not recover costs because the petitioners obtained the documents through the Public Records Act, which prohibits recovery of staff and consultant time associated with production of documents. The court again disagreed, ultimately finding that the County was entitled to recover its costs as the prevailing party, and that the petitioners failed to show that the County’s account of staff time and hourly rates were unreasonable.

SIXTH DISTRICT UPHOLDS CLASS 32 URBAN INFILL CATEGORICAL EXEMPTION FOR GROCERY OUTLET STORE

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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

 

 

 

D.C. CIRCUIT COURT OF APPEALS FINDS COUNCIL ON ENVIRONMENTAL QUALITY LACKS AUTHORITY TO ISSUE NEPA REGULATIONS

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In an opinion published on November 12, 2024, the U.S. Court of Appeals for the D.C. Circuit in Marin Audubon Society v. Federal Aviation Administration (D.C. Cir. 2024) 121 F.4th 902, found that the Council on Environmental Quality’s (CEQ’s) regulations implementing the National Environmental Protection Act (NEPA) were ultra vires and thus invalid. The court held that CEQ lacked authority to issue such regulations because its rulemaking authority was tied not to a Congressional act but to a presidential Executive Order.

BACKGROUND

The National Parks Air Tour Management Act of 2000 requires the Federal Aviation Administration (FAA) and the National Park Service (NPS) to develop plans regulating tour flights over national parks throughout the United States. Pursuant to the Act, the FAA and NPS issued an Air Tour Management Plan governing tourist flights over four Bay Area, California national parks: the Golden Gate National Recreation Area, Muir Woods National Monument, San Francisco Maritime National Historical Park, and Point Reyes National Seashore. The Agencies determined that they did not need to prepare an environmental analysis under NEPA because the Plan, as compared to what currently existed, would cause little to no additional environmental impacts.

THE COURT OF APPEALS’ OPINION

Several environmental organizations and one area resident petitioned for review of the Plan, arguing that the Agencies violated NEPA and the CEQ’s NEPA regulations. Petitioners argued that the Agencies violated CEQ’s regulations by foregoing an environmental assessment; the Agencies denied the claim and defended their action by invoking the same regulations.

The D.C. Circuit declined to address the merits of these arguments and instead independently held that CEQ’s regulations—which purport to govern how all federal agencies must comply with NEPA—are ultra vires and thus invalid.

Historical Legal Background

The CEQ traces its rulemaking authority not to a legislative act, but to a presidential Executive Order (EO). But because an EO is neither legally binding nor has the force of law, CEQ’s authority to issue regulations raises a separation of powers issue.  NEPA, on the other hand, is a legislative act that Congress adopted in 1969, which requires each federal agency to issue a detailed statement addressing the environmental impact of any proposed major federal action that significantly affects the quality of the human environment. All federal agencies must develop procedures that implement NEPA. The Act also created the CEQ within the Executive Office of the President, to be run by three presidentially appointed Commissioners who are confirmed by the Senate. CEQ’s job is to “review and appraise” agencies’ compliance with NEPA, make recommendations to the President with respect thereto, and develop and recommend to the President national policies to foster and promote the improvement of environmental quality.

In 1970, President Nixon issued an EO instructing CEQ to issue guidelines on how federal agencies should prepare the detailed environmental analyses NEPA required. CEQ subsequently published a memorandum with guidelines for federal agencies to consider when considering or preparing environmental impact statements. At the time, several courts regarded CEQ’s role as “merely advisory” because it lacked authority to prescribe regulations that governed or mandated compliance with NEPA. CEQ, however, held a different view, and considered its NEPA guidelines to be mandatory non-discretionary standards that federal agencies must comply with. The D.C. Circuit in Sierra Club v. Morton (1975) 514 F.2d 856 agreed that CEQ could equivocate its guidelines as legally binding rules that were entitled to great respect and heightened deference.

In 1977, President Carder issued an EO that empowered CEQ to issue “regulations,” as opposed to “guidelines,” which required all federal agencies to comply with CEQ’s NEPA regulations unless doing so would violate federal law. In response, CEQ invoked the EO and “the President’s Constitutional and statutory authority” to issue 92 new regulations, which prescribed uniform standards that were binding on all federal agencies, courts, and NEPA litigants. The framework promulgated by those largely remains in effect today.

CEQ’s NEPA Regulations are Ultra Vires

Based on CEQ’s and NEPA’s historical background, the D.C. Circuit explained that executive agencies, such as the FAA and the NPS, are statutory creatures that have no power to act except to the extent authorized by Congress. Thus, for CEQ’s regulations to be legally binding on those agencies, a nexus must be established between the regulations and some delegation of Congressional legislative authority. In other words, the court must determine whether CEQ, as an executive or independent agency, has statutory authority from Congress to issue its NEPA regulations.

Although CEQ publishes its NEPA regulations in the Code of Federal Regulations, such publication is no measure of the agency’s authority to issue the rules that appear there. Here, NEPA’s provisions provide no support for CEQ’s authority to issue binding regulations. No statutory language states or suggests that Congress empower CEQ to issue rules binding on other agencies—that is, to act as a regulatory, rather than advisory, agency. The court reiterated: “NEPA contains nothing close to the sort of language Congress typically uses to confer rulemaking authority.”

The court also noted that “[n]o statute confers rulemaking authority on CEQ.” The court cited the Environmental Quality Improvement Act of 1970 as an example, which established the Office of Environmental Quality that is headed by the CEQ Chairman. Even as the director of that office, CEQ’s chairman only has the authority to “assist” other federal agencies and may only “promulgate regulations” related to the Office’s funding for research studies and projects.

The court qualified that the Supreme Court’s prior pronouncements on CEQ’s regulations could not rescue them. Although the Court once wrote that those regulations were “entitled to substantial deference,” the statement did not result from the Court’s examination of CEQ’s authority to issue judicially enforceable regulations.

The court further concluded that CEQ’s regulations were not a delegation of the President’s authority under the Constitution’s “Take Care Clause.” While EOs are focused solely on the internal management of the Executive Branch—and thus create no private rights and are not judicially reviewable—NEPA imposes statutory obligations that agencies must execute, which in turn affect private parties who make seek judicial review of those agencies’ actions. The court reasoned: “If all federal agencies are bound by the CEQ regulations and must follow them in carrying out their obligations under NEPA, and if the regulations are enforceable by courts, then those regulations cannot be justified solely as an exercise in a President’s oversight of his Administration.” To this end, the Supreme Court has previously held that the Take Care Clause cannot be used to bypass agencies’ limited status as “creatures of statute” because the Constitution does not permit the President to seize Congress’ lawmaking power by issuing an order that, like a statute, authorizes a government official to promulgate rules and regulations.

Based on these foregoing reasons, the court held that CEQ had no lawful authority to promulgate NEPA regulations that are binding on federal agencies.

– Bridget McDonald

SECOND DISTRICT HOLDS SOME, BUT NOT ALL, CEQA CHALLENGES TO PROPOSED DEVELOPMENT WERE BARRED FOR FAILURE TO COMPLY WITH SUBDIVISION MAP ACT’S 90-DAY DEADLINE FOR SERVICE OF SUMMONS

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In Santa Clarita Organization for Planning the Environment v. County of Los Angeles (2024) ___ Cal.App.5th ___, the Second District Court of Appeal held that the 90-day deadline for service of summons provided by the Subdivision Map Act (SMA) applied to CEQA claims challenging the sufficiency of mitigation measures adopted as conditions of approval of a vesting tentative map, but claims alleging violations of CEQA’s procedural requirements, which could not be brought under the SMA, were not subject to the SMA’s summons requirement.

Background

In 2018, a developer proposed to subdivide roughly 94 acres of open space in an unincorporated portion of the Santa Clarita Valley to develop 37 single-family homes, six public facilities, and two open space areas. To comply with CEQA, the County of Los Angeles prepared a mitigated negative declaration (MND) and a mitigation monitoring and reporting program (MMRP) for the Project.

On March 15, 2022, the County adopted the MND for the Project and conditionally approved a vesting tentative map and related permits for the Project. Among other things, the conditions of approval of the vesting tentative map required compliance with the MMRP.  The County filed a Notice of Determination on March 22, 2022.

On April 20, 2022, Petitioner Santa Clarita Organization for Planning the Environment filed a petition for writ of mandate challenging the County’s approval of the Project. The Petition’s first cause of action alleged that the County violated CEQA, and a second cause of action alleged that the County violated the Planning and Zoning Law and the SMA. Petitioner did not obtain or serve a summons when it filed the Petition.

The developer filed a motion for judgment on the pleadings, arguing that Petitioner was required under the SMA to serve a summons within 90 days of the Project approvals but failed to do so. The trial court granted the motion and entered judgment in favor of the County and the developer on both causes of action. Petitioner appealed, arguing that the CEQA cause of action was not subject to the SMA’s summons requirement.

The Court of Appeal’s Decision

The Second District reversed the judgment with respect to the CEQA cause of action, finding that some, but not all, of the CEQA claims were barred under the SMA.

Initially, the court acknowledged the complexity of determining whether a CEQA challenge to a tentative or final map approval is subject to the SMA’s summons requirement. The court therefore cautioned that petitioners bringing such challenges “proceed at their peril if they fail to obtain and serve a summons within 90 days of the approval.”

The court held that Petitioner’s challenges to the adequacy of the mitigation measures in the MMRP were subject to the SMA’s summons requirement, which is set forth in Government Code section 66499.37. That section imposes a 90-day limitations period for filing a lawsuit and serving a summons, where a party challenges a legislative body’s decision “concerning a subdivision” or “the reasonableness, legality, or validity of any condition attached [to an approval of a subdivision], including, but not limited to, the approval of a tentative map.” Because the County required compliance with the MMRP as a condition of approval of the vesting tentative map for the Project, the court reasoned that Petitioner’s challenges to the adequacy of the mitigation measures necessarily concerned the “reasonableness” of a “condition attached [to an approval of a subdivision].” Accordingly, the court determined that those challenges were within the scope of the SMA.

By contrast, the court held that Petitioner’s claims alleging procedural CEQA violations were not within the scope of the SMA, and therefore not subject to the SMA’s summons requirement. In doing so, the court rejected the respondents’ argument that Government Code section 66499.37 applies to any challenge to a decision “concerning a subdivision.” Citing the statutory language, legislative history and intent, and relevant case law, the court explained that section 66499.37 only applies to challenges that could have been brought under the SMA or that overlap with an SMA claim. Because Petitioner’s procedural CEQA challenges were unique to CEQA and did not arise from or involve any controversy under the SMA, the court determined that those challenges were not subject to section 66499.37.

Accordingly, the court concluded that the trial court erred in granting the motion for judgment on the pleadings in its entirety. Acknowledging that a trial court may not grant a motion for judgment on the pleadings as to only part of a cause of action, the court reversed the judgment and directed the trial court to deny the motion as to the CEQA cause of action.

– Blaine R. Dyas

NINTH CIRCUIT HOLDS MULTIPLE CEQA CHALLENGES TO PROPOSED HOTELS WERE NOT OBJECIVELY BASELESS SHAM LAWSUITS BEYOND THE SCOPE OF FIRST AMENDMENT PROTECTIONS

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In Relevant Group, LLC v. Nourmand (9th Cir. 2024) 116 F.4th 917, the Ninth Circuit Court of Appeals held that the Defendants’ multiple CEQA challenges to Plaintiff’s proposed hotel projects were constitutionally protected under the First Amendment and therefore could not give rise to liability under the federal Racketeer Influenced and Corrupt Organizations Act (RICO).

Background

Beginning in 2015, Plaintiffs proposed four hotel projects in the Hollywood neighborhood in the City of Los Angeles. Defendants opposed the projects during the City’s administrative approval process and in multiple CEQA lawsuits.

In June 2019, after the parties settled two CEQA lawsuits and while a third was underway, Plaintiffs filed a RICO lawsuit, alleging that Defendants had abused the CEQA process to extort Plaintiffs. Defendants filed a motion for summary judgment, which a district court judge initially denied; however, the case was transferred to a new judge, who reversed the prior ruling and granted summary judgment in favor of Defendants. Plaintiffs appealed.

The Ninth Circuit’s Decision

The Ninth Circuit affirmed the summary judgment in favor of Defendants, holding Defendants’ multiple CEQA challenges were constitutionally protected and could not give rise to liability under RICO.

As an initial matter, the court rejected Plaintiffs’ argument that the district court abused its discretion by reconsidering the prior summary judgment ruling. While courts generally may not reconsider prior rulings by the same court in the same case, the court concluded that this case fell under an exception for situations in which the prior ruling was “clearly erroneous” and enforcement would result in a “manifest injustice.”

With respect to the merits, the court held that Defendants’ CEQA lawsuits were protected under the Noerr-Pennington doctrine, which generally protects parties exercising their right to petition from statutory liability. In so holding, the court rejected Plaintiffs’ argument that the Defendants’ CEQA lawsuits fell under the “sham litigation” exception to the Noerr-Pennington doctrine.

The court considered two different tests for the sham litigation exception. The first stems from Professional Real Estate Investors, Inc. v. Columbia Pictures Industries, Inc. (1993) 508 U.S. 49 (PREI). Under the two-step PREI test, the exception applies when a court first determines that a lawsuit is “objectively baseless,” then determines that the motive behind the lawsuit is improper. The second test, from USS-POSCO Industries v. Contra Costa County Building & Construction Trades Council, AFL-CIO (9th Cir. 1994) 31 F.3d 800 (POSCO), applies where a party files a “series” of lawsuits, without regards to their merits, for an unlawful purpose.

The court held that the two-step PREI test, rather than the POSCO test, applied to Defendants’ CEQA lawsuits. The court concluded that Defendants’ CEQA challenges to four of Plaintiffs’ hotel projects did not constitute a “series” of lawsuits for purposes of applying the POSCO test, explaining that POSCO itself involved twenty-nine lawsuits—a stark difference. The court rejected Plaintiffs’ argument that the CEQA challenges to the four projects were really comprised of twenty separate proceedings that brought them within the scope of POSCO, explaining that Plaintiffs’ proposed framework was inconsistent with the case law and would present “line-drawing” problems for future courts.

Applying the first step of the PREI test, the court concluded that Defendants’ CEQA lawsuits were not objectively baseless. Among other things, the court pointed out that Plaintiffs had settled two of the CEQA lawsuits—and that the terms of those settlements included environmental protections—and that a third CEQA lawsuit resulted in a court order directing the City to further consider one of the project’s environmental impacts. Moreover, the court explained that success in a CEQA lawsuit may come in many forms, and that many CEQA petitioners have a “low threshold” for success. Finally, the court emphasized that the Noerr-Pennington doctrine is intended to prevent any “chilling effect” on the constitutional right to petition; thus, it acknowledged that courts should find that litigation is objectively baseless “only with great reluctance.” Given its conclusion that Defendants’ CEQA lawsuits were not objectively baseless, the court did not reach the second step of the PREI test.

Accordingly, the court determined that Defendants’ CEQA actions were protected under the Noerr-Pennington doctrine and could not result in RICO liability.

– Adam D. Nir

SECOND DISTRICT HOLDS NOISE FROM ROOFTOP DECKS IS NOT A SIGNIFICANT IMPACT PRECLUDING USE OF THE CLASS 32 EXEMPTION FOR MULTIFAMILY RESIDENTIAL PROJECT, BUT CITY ERRED BY FAILING TO EVALUATE THE PROJECT’S CONSISTENCY WITH THE APPLICABLE DEVELOPMENT PLAN

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In West Adams Heritage Association v. City of Los Angeles (2024) __ Cal.App.5th __, the Second District Court of Appeal considered challenges to a determination by the City of Los Angeles that a proposed multifamily residential development was categorically exempt from CEQA under the Class 32 exemption for urban in-fill development projects. In the published portion of its opinion, the court held that (1) rooftop noise generated by the Project was not a significant environmental impact precluding the City from relying on the Class 32 exemption, but (2) the City improperly relied on the Class 32 exemption without first finding that the Project was consistent with the applicable redevelopment plan.

Background

Project approval and administrative appeals

The Project applicants proposed to demolish an existing parking lot and two-story building on a 2.8-acre lot and replace them with a seven-building, 102-unit apartment complex with outdoor amenity spaces on the building rooftops. The Project site is less than a mile from the University of Southern California campus and is surrounded by residential, commercial, and educational buildings.

In May 2019, a City zoning administrator approved a conditional use permit and a density bonus for the Project. The zoning administrator also issued a determination letter finding that the Class 32 exemption applied to the Project and that no exceptions to the exemption applied. At the same time, however, the zoning administrator denied a site plan review, concluding that the original Project proposal was not compatible with the surrounding uses due to its size and potential aesthetic, architectural, and noise issues. The Project applicants submitted a revised Project proposal that resolved the zoning administrator’s concerns, and the City Planning Commission overturned the site plan review denial.

Meanwhile, a Project opponent appealed the zoning administrator’s Project approvals and the determination that the Project was categorically exempt from CEQA to the Planning Commission. The Planning Commission denied the appeal in October 2019, and the Project opponent appealed to the City Council.

In November 2019, while that appeal was pending, the City Council passed an ordinance that, among other things, expressly incorporated the land use and development regulations of the local Exposition/University Park Redevelopment Plan (Redevelopment Plan) into the zoning requirements applicable to the Project site (Ordinance 186325). Ordinance 186325 provides that, to the extent the regulations in the Redevelopment Plan (which was adopted in 1966 and last updated in 1989) conflict with the City’s zoning laws, the Redevelopment Plan generally controls.

In December 2019, the Planning Commission issued a corrected letter of determination imposing new conditions of approval on the Project. Among other things, those conditions effectively required a determination that the Project was consistent with the Redevelopment Plan before the City would issue a building permit for the Project.

The City Council denied the Project opponent’s second administrative appeal in February 2020.

Litigation history

Petitioners West Adams Heritage Association and Adams Severance Coalition filed a petition for writ of mandate alleging that the City improperly found the Project to be categorically exempt from CEQA. The trial court denied the petition and Petitioners appealed. In an unpublished opinion filed in August 2023, the Second District reversed, finding that the Project’s potential noise impacts rendered the Class 32 exemption inapplicable.

In September 2023, the Legislature adopted Assembly Bill (AB) 1307. AB 1307 amended CEQA to provide that, for residential projects, “the effects of noise generated by project occupants and their guests on human beings is not a significant effect on the environment.”

The Supreme Court granted review of the Second District’s original decision in November 2023. In July 2024, shortly after issuing its decision in Make UC a Good Neighbor v. Regents of University of California (2024) 16 Cal.5th 43 (MUCAGN II), the Supreme Court transferred the case back to the Second District with instructions to vacate its August 2023 decision and reconsider the matter in light of AB 1307 and MUCAGN II.

Court of Appeal’s Decision

Noise impacts

The Second District held that its original decision could no longer stand after AB 1307 and MUCAGN II. The court explained that under those authorities, any effects of noise from the Project’s rooftop spaces on neighboring uses could not be significant impacts for purposes of CEQA. Relying on the plain language of AB 1307 and MUCAGN II, as well as the legislative history and intent of AB 1307, the court rejected Petitioners’ arguments that the Project was distinguishable from the project at issue in MUCAGN II due to its proposed “rooftop decks that could have amplified music” and the fact that it was proposed by a private developer instead of a university.

The court also rejected Petitioners’ argument that AB 1307 does not apply to CEQA exemptions. The court pointed out that the statutory language expressly applies to CEQA generally and is not limited to any particular subset of CEQA’s provisions. Additionally, while the court acknowledged that AB 1307 did not amend the Class 32 exemption—which requires that covered projects “would not result in any significant effects relating to … noise”—the court explained that AB 1307 conclusively established that certain types of noise could not “result in any significant effects” that would render a residential project ineligible for the Class 32 exemption. Similarly, the court reasoned that noise generated by Project occupants was not a significant impact for purposes of applying the “unusual circumstances” exception to the Class 32 exemption.

Redevelopment Plan consistency

The court nevertheless held that the City improperly relied on the Class 32 exemption—which also requires covered projects to be consistent with the applicable zoning—without first evaluating the Project’s consistency with the Redevelopment Plan. The court explained that under Ordinance 186325, the Redevelopment Plan was part of the applicable zoning with which the Project was required to be consistent to qualify for the Class 32 exemption.

The City and the Project applicants (together, Respondents) argued that Ordinance 186325, which was enacted after the City first approved the Class 32 exemption, did not apply to the Project approvals, but the court disagreed. The court explained that the new law applied retroactively to the Project because (1) MUCAGN II instructed courts to apply current laws in mandamus proceedings, (2) the Project approvals were not final when Ordinance 186325 was passed, as an appeal to the City Council was still pending, (3) the Project applicants had not yet obtained a building permit or other entitlement that might confer a vested right to complete the Project, and (4) Respondents did not cite any local law otherwise precluding the application of new zoning laws to the pending Project approvals.

The court also rejected Respondents’ argument that the City adequately addressed Redevelopment Plan consistency by effectively requiring the Project applicant to obtain a consistency determination before the City would issue a building permit. Respondents cited that requirement as substantial evidence supporting the City’s reliance on the Class 32 exemption; however, the court explained that no such evidence could exist absent an actual determination by the City.

Notably, in response to Petitioners’ argument that the Project’s proposed density was already inconsistent with the Redevelopment Plan, the court clarified that the Redevelopment Plan’s density provisions did not apply to the Project. The court explained that, under the current state density bonus law, density bonuses are calculated using the “greatest number of units allowed under the zoning ordinance, specific plan, or land use element of the general plan” at the time the Project application was submitted. But as the court pointed out, regardless of whether or not the Redevelopment Plan’s density provisions applied when the Project application was submitted, the Redevelopment Plan sets a lower maximum density for the Project site than the City’s generally applicable zoning laws; thus, the court concluded that the City properly calculated the density bonus using the latter. Finally, the court noted that, to the extent the Redevelopment Plan imposes conditions on density bonuses beyond those required under the state density bonus law, state law preempts the Redevelopment Plan.

– Louisa I. Rogers

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