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OPR Solicits Input in Effort to Improve State Groundwater Management

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On January 27, 2014, Governor Jerry Brown issued the California Water Action Plan, which highlights the challenges for managing the State’s water resources and outlines strategic goals and actions to provide more reliable water supplies, restore important species and habitat, and establish a more resilient and sustainably managed water resource system for farms, ecosystems and communities. The plan specifically identified a number of actions to implement sustainable groundwater management practices. One of those actions called for legislation to provide local and regional agencies with comprehensive authority to manage groundwater. If those agencies fail to achieve sustainable management, the Plan proposes allowing the state to temporarily assume responsibility for groundwater management. The Governor’s Office of Planning and Research (OPR) is now seeking input on actions that can be taken to improve groundwater management in California.

Groundwater control has generally been left to local efforts and courts; California has no comprehensive authority for monitoring or regulating groundwater. One primary objective of the Plan is to establish a legal framework through which to improve groundwater management and expand groundwater storage capacity.

OPR planned two sustainable groundwater management workshops, on March 24 and April 16, facilitated by the California Environmental Protection Agency, the California Department of Food and Agriculture, and the California Natural Resources Agency. The purpose of the workshops is to solicit ideas and approaches to groundwater management.

OPR now seeks input on the following questions:

  • What new or modified statutory authorities do local and regional agencies need to manage groundwater more effectively?
  • What would help local agencies overcome barriers to funding for conservation, projects, and programs?
  • What types of governance structures are most effective for managing groundwater locally, and should these models be encouraged?
  • What specific data and information do local managers need to succeed? What should be done to help them obtain the data?
  • What can be done to help local and regional agencies manage a basin or sub-basin that spans multiple jurisdictions?
  • Are there improvements to the groundwater adjudication process that would make it more useful and cost-effective for local authorities?
  • What role should groundwater management plans play, and does their content need to change?
  • What incentives could local and regional agencies be given to improve groundwater management?
  • Should local groundwater management planning be connected, through formal processes, to land use decisions, county general plans, or integrated regional water management plans? If so, what kind of formal processes?

More information can be found at:

http://www.opr.ca.gov/docs/Sustainable_Groundwater_Management_3-7-2014.pdf

http://www.opr.ca.gov/docs/joint_workshop_notice.pdf

Written comments are due to OPR by April 25, 2014.

Tahoe Regional Planning Agency Will Proceed with Regional Plan Update After Federal Court Victory

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On April 7, 2014, the United States District Court for the Eastern District of California issued an order granting defendant Tahoe Regional Planning Agency’s (TRPA’s) cross-motion for summary judgment against Sierra Club and Friends of the West Shore. In doing so, the court upheld TRPA’s approval of its Regional Plan Update (RPU).

The court held that TRPA’s findings were supported by substantial evidence in the record, deferring to the agency’s expertise where the parties engaged in factual disputes. TRPA used the Total Maximum Daily Load model to reduce the flow of pollutants into the lake, rather than relying solely on strict limits on impervious surface coverage to achieve this goal, as it had done under the previous plan. The court determined that this decision was reasonable and supported by substantial evidence in the record, including numerous reports and studies prepared by TRPA. The court also upheld TRPA’s methodology for examining cumulative impacts to soil conservation, and stated that the agency was entitled to conclude that its mandatory, incentivized best management practices ordinance would be followed and would help improve lake clarity. Finally, the court upheld TRPA’s finding that the Regional Plan, as amended by the RPU, would achieve and maintain the ozone threshold in the Tahoe basin.

RMM partners Whitman Manley and Howard (Chip) Wilkins represented TRPA in the case.

Third Appellate District Court Finds Analysis of Urban Decay and Energy Impacts in a Programmatic EIR for Commercial Development Fails to Comply with CEQA

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California Clean Energy Committee v. City of Woodland, Case No. C072033 (April 1, 2014)

Petrovich Development Company, LLC proposed to develop a 234-acre regional shopping center knows as “Gateway II” on undeveloped agricultural land located on the outskirts of the City of Woodland. After preparing a programmatic EIR, the city council reduced the size of the project to 61.3 acres and approved the project. California Clean Energy Committee (CCEC) filed a petition for writ of mandate challenging the city’s approval of the project. The trial court denied the petition.

On appeal CCEC contended (1) the trial court erred in concluding the project did not conflict with the city’s general plan, (2) the city’s mitigation measures are insufficient to ameliorate the urban decay that the project could cause, (3) the city did not give meaningful consideration to feasible project alternatives such as the mixed-use alternative, and (4) the final EIR did not properly identify and analyze potentially significant energy impacts generated by the project.

In an unpublished portion of the opinion, the court rejected CCEC’s first claim that city’s actions in approving Gateway II violated the State Planning and Zoning Law because the project was inconsistent with the city’s general plan policy of revitalizing its downtown. The court held the CCEC had failed to preserve this argument because its CEQA petition had failed to plead a separate violation of the Planning and Zoning Law.

With respect to CCEC’s claims regarding the City’s urban decay mitigation measures, the court agreed with CCEC that the measures were inadequate to mitigate the urban decay anticipated to result from the project. The mitigation measures the city adopted required the developer (1) to apply for a master conditional use permit subject to future evaluation and potential further environmental review and indicating a list of specific project uses that “shall primarily consist of regional retail uses that do not include entertainment uses and other uses that would compete with retail in Downtown Woodland”; (2) to submit a market study and urban decay analysis for review and approval by the city’s Community Development Department showing either that adequate retail demand exists or require additional mitigation or an alternate use; (3) to contribute funds toward the development of a “Retail Strategic Plan” to be prepared by the city; (4) to contribute funds toward the preparation of an “Implementation Strategy for the Downtown Specific Plan” to be prepared by the city; and (5) to “coordinate with the current owner of the County Fair Mall to prepare a strategic land use plan for the County Fair Mall to analyze potential viable land uses for the site.” The EIR determined, however, that even with the implementation of this mitigation, the city still anticipated the urban decay impact to be significant and unavoidable, in part because it was unknown at the time of approval what specific uses and stores could be proposed in the future in the project area.

The court found, as to the first mitigation measure, it was permissible under CEQA because it served to ensure the primary retail uses for the development will be regional and would not outright ban all retail uses that compete with the city’s downtown. The court also accepted the city’s representation that it “merely found that this measure would help, albeit not enough to avoid the significant urban decay impact identified by the EIR.” The court found, however, that the measure was inadequate, standing alone, to mitigate the potential adverse impacts of the development.

The court found that the second mitigation measure, by requiring the developer to prepare the market study, impermissibly ceded the city’s responsibility for studying an environmental impact to the developer. The court rejected CCEC’s claim that the city council erred by delegating the responsibility to implement the mitigation measure to the community development department, finding that delegation of responsibility for a monitoring program is appropriate under CEQA. Further, the court found the market study measure was inadequate because it did not commit the city to any specific mitigation action or impose any performance standards for determining whether it needed to undertake any future measures. Despite the fact that the EIR was a programmatic review which anticipated potential future environmental review for site-specific discretionary projects, the court concluded that, given the city’s recognition that the project would cause urban decay, the mitigation was required to do more than merely agree to a future study of the problem.

The court found the third and fourth mitigation measures were similarly inadequate for their failure to commit the city to any feasible or enforceable mitigation measures to ameliorate the adverse effects of the project on urban decay elsewhere in Woodland. The requirement for preparation of the Retail Strategic Plan and Implementation Strategy for a downtown specific plan appeared in the Draft EIR without further discussion or analysis. The final EIR adopted these mitigation measures without elaboration. The court explained that although mitigation fee programs may constitute adequate mitigation to address the adverse effects of a project, the mere payment of fees does not presumptively establish full mitigation for a discretionary project if there is no evidence that there is an established fee program in place. Here, the court found the city’s EIR did not adequately assess the scope of the program or fees necessary to adequately address the urban decay impacts expected to result from the project.

Finally, the court found that the fifth measure, although it purported to alleviate expected urban decay at Woodland’s County Fair Mall, required the city to take no action other than to coordinate with the current owner to prepare a plan for viable land uses at the County Fair Mall. The court found the mitigation measure does not require any action by the city to mitigate the urban decay it may discover to result for the County Fair Mall. As such, the court held this purported mitigation measure was inadequate. The court found that, though the EIR was a programmatic EIR, tiering of environmental review and deferring environmental analysis and mitigation measures to later phases would only be appropriate in cases where the impacts or mitigation measures are specific to those later phases. Here, because the EIR studied and attempted to mitigate the urban decay effects from the project as a whole, the city could not be permitted to excuse inadequate mitigation by putting off corrective action to a future date.

The court then held the city failed to comply with CEQA when it rejected the mixed-use alternative as infeasible. The Draft EIR concluded that the alternative was infeasible due to economic considerations; however, the city council’s findings rejected the alternative as environmentally inferior to the project. The court found the city had adopted a rationale for rejecting the alternative that was unsupported by the EIR analysis, which assumed certain impacts would be similar to the project impacts.

Finally, the court found the city’s treatment of energy impacts was inadequate. The court noted that the EIR’s discussion of energy lacked detail as it comprised less than one page. Furthermore, the court found the discussion inadequate as it did not provide an assessment of or mitigation for certain energy impact categories set forth in Appendix F of the CEQA Guidelines including transportation energy impacts, construction energy impacts, and renewable energy impacts. While the EIR did require the project’s compliance with the state building code and green building standards, the court found such standards alone would not adequately mitigate construction and operational energy impacts of the project.

Second District Court of Appeal Holds EIR/EIS for the Newhall Ranch Resource Management and Development Plan and Spineflower Conservation Plan Complies with CEQA

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In Center for Biological Diversity v. Department of Fish and Wildlife (Mar. 20, 2014) ___ Cal.App. ___, Case No. B245131, the Second Appellate District reversed the trial court judgment granting a petition for writ of mandate challenging the California Department of Fish and Wildlife’s (Department) approval of the Newhall Ranch Resource Management and Development Plan and Spineflower Conservation Plan. In the published portion of its opinion, the court held that the provisions of the Fish and Game Code supported a determination that live trapping and transplantation of a protected species of fish does not constitute an unlawful taking when undertaken by the Department for conservation purposes. The court also found the Environmental Impact Report’s analysis of cultural resources, alternatives, impacts to Steelhead smolt, and impacts to spineflower complied with CEQA.

The Newhall Land and Farming Company proposed an almost 12,000-acre Specific Plan area approved by Los Angeles County in 2003 and to be built out over a number of years. After the local county approved an environmental impact statement for the proposed development, the Department prepared and certified an EIR for the project—a Resource Management and Development Plan and Spineflower Conservation Plan. The EIR analyzed the potential environmental effects of issuing incidental take permits and a streambed alteration agreement under the project. The construction of the project would impact, among other things, the stickleback, a fish protected under Fish & Game Code §5515(a)(1) as a “fully protected species.”

The Center for Biological Diversity filed a petition for writ of mandate challenging the Department’s actions. The trial court granted the writ petition, finding, among other things, that the department failed to prevent the taking of the stickleback. The Department and the developer appealed. The court of appeal reversed, holding that the trial court erred in granting the petition.

The court found substantial evidence supported the Department’s conclusion that no take of the stickleback would occur. The court found that the EIR contained mitigation measures to exclude stickleback from any construction areas in the river and to trap and relocate any stranded stickleback to other parts of the river in temporary containers. The court found substantial evidence supported a determination that no mortality would occur given the extraordinary measures taken by the Department to ensure the sticklebacks’ safety, including undertaking surveys of stickleback habitat prior to developing its plan, preparation of ten different studies, and employing the expertise of one of the leading authorities on stickleback preservation. The extensive mitigation measures, coupled with the expert’s discussion, constituted substantial evidence no deaths would result.

The court also rejected CBD’s contention that the mitigation measures themselves would constitute a taking prohibited by Fish and Game Code §§86 and 5515(a)(1). Those sections defined a prohibited take as the “catch, capture, or kill” of protected fish. After a thorough review of pertinent sections of the code, along with their legislative histories, the court agreed with the Department and developer that the use of live trapping and transplantation techniques approved in Fish and Game Code §2061 would not constitute a prohibited take or possession. The court reasoned the entire statutory scheme must be construed together and section 2061 allows for live trapping and transplantation when performed for conservation purposes. Such techniques, as explained by the Department’s expert, can involve the possession and movement of the stickleback in containers to parts of the river that would not be impacted by construction. Therefore, the court concluded the mitigation measures would not result in an unlawful take or possession of stickleback.

The court also rejected CBD’s claims that the EIR failed to adequately address the cultural resources impacts of the project. As an initial matter, the court found CBD had forfeited its cultural resources claims by failing to raise such issues during the public comment period. As a result, the court held CBD failed to exhaust administrative remedies and Department had no obligation to respond to untimely comments. Though finding the claims waived, the court addressed these claims on the merits and rejected them, finding the cultural resource analysis was supported by substantial evidence. The analysis in the EIR was based on extensive research, surveys, and studies performed by consultants with expertise in the field. The consultants undertook excavations of areas that the research and studies indicated resources might be present. Furthermore, the court found there was no evidence that the consultant have failed to uncover any human remains. Though human remains had been found near the project site, the court found that those earlier, off-site discoveries did not require the Department to conduct additional plug tests on site to confirm the consultant’s conclusion. The court also upheld the cultural resources mitigation measures set forth in the EIR as adequate and in full compliance with CEQA Guidelines §15126.4(b)(3)(A).

The court rejected CBD’s claim that the Department’s determination regarding the feasibility of one of the alternatives was not supported by substantial evidence. The court found that, in general, the alternatives were appropriate because they were required to follow the Newhall Ranch Specific Plan. In considering the objectives of the specific plan, the alternative in question would not meet the project objectives to provide a new major community with industrial, commercial, and residential uses because the alternative lacked commercial uses in one planning area and had no connectivity to the easternmost portion of the project area. Furthermore, the alternative was economically infeasible based on application of an industry metric of the cost per developable acre compared to the proposed project. The court upheld this methodology and found substantial evidence supported the Department’s determination regarding the infeasibility of the alternative.

The court rejected CBD’s claims that the EIR failed to address the potential effects on steelhead smolt downstream of the project area due to dissolved copper discharges.  Again, the court found CBD had forfeited its claims for failing to raise them during the public comment period. Though waived, the court addressed the claims and found that there were no steelhead smolt in the project area because the habitat would be below the dry gap where the river goes underground. Furthermore, the dissolved copper discharged to the river would be below the California Toxics Rule Threshold with compliance with regulatory requirements and implementation of mitigation measures and design features. The court found substantial evidence supported the Department’s determination that the project’s impacts on steelhead smolt would be less than significant.

The court rejected CBD’s claims of flaws in the EIR’s analysis of impacts to the San Fernando Valley spineflower, which is listed as endangered under the California Endangered Species Act (CESA) and is known to occur only in the project area and one other location in Ventura County.  The Department issued an incidental take permit for spineflower, allowing take of 24% of the habitat within the Specific Plan area. The court found substantial evidence supported the mitigation plan for the spineflower. The Department had employed 43 biologists who conducted 21 surveys to identify the potential spineflower habitat. The Conservation Plan would dramatically expand the area for potential growth of the spineflower: from 13.88 acres of growth to 56.79 acres of core growth, 110.77 acres of buffer and 42.90 acres of expansion areas. The Plan would ultimately increase the preserve areas from two to five. The court also found that Department’s comprehensive monitoring plan did not constitute impermissible deferral of mitigation, but rather called for future research, which represented “sound ecological management.”

In an unpublished portion of the opinion, the court upheld the EIR’s greenhouse gas analysis. The Department employed a significance threshold for greenhouse gas emissions premised on the reduction target established under the California Global Warming Solutions Act (AB 32) where GHG emissions would be significant if the project would impede achievement of a reduction in statewide GHG emissions to 1990 levels by 2020.  The court held the Department had discretion to employ this threshold and concluded the threshold was appropriate.  The court found the GHG analysis complied with CEQA because it was consistent with the requirements for such analysis set forth in CEQA Guidelines §15064.4(b)(1)-(3) and was supported by substantial evidence.

Court of Appeal Finds Rodeo Categorically Exempt from CEQA

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Citizens for Environmental Responsibility v. State of California ex rel. 14th District Agricultural Association (Mar. 26, 2014) ___ Cal.App. ___, Case No. C070836.

On March 26, 2014, the Third District Court of Appeal affirmed the trial court’s denial of injunctive relief against a rodeo. Appellants, an environmental group concerned about possible water quality impairment due to manure runoff from the rodeo, claimed the 14th District Agricultural Association violated CEQA by approving an exemption from environmental review for a rodeo held at the Santa Cruz County Fairground in 2011. The District had found the rodeo exempt from CEQA review under the Class 23 categorical exemption for normal operations of existing facilities for public gatherings. Appellants argued that the Class 23 exemption did not apply here because (1) the rodeo project impermissibly included mitigation measures in its determination that the project was exempt, and (2) the unusual circumstances exception to the exemption applied. The Court of Appeal disagreed.

A Class 23 exemption covers “normal operations of existing facilities for public gatherings for which the facilities were designed, where there is a past history of the facility being used for the same or similar kind of purpose.” This means similar activity has been occurring for at least three years and there is a reasonable expectation that the project would not represent a change in operation of the facility. The court noted that the fairground had hosted dozens of livestock and equestrian events annually for decades. The court rejected appellants’ contention that the exemption was impermissibly premised on proposed mitigation measures. The alleged mitigation measures, which dealt with manure disposal, had been in place years before the proposed rodeo, and had been formalized in a manure management plan in 2010. Thus, the court found that the plan was not a new measure proposed for or necessitated by the rodeo project, and was instead part of the ongoing “normal operations” of the fairground.

Finding that no mitigation measure precluded application of a categorical exemption, and finding that the Class 23 categorical exemption applied to the project, the court turned to appellants’ second argument that the rodeo fit within the unusual circumstances exception to the exemption.

The court laid out a two-part test for the unusual circumstances exception: first, determine whether the project presents unusual circumstances. If there are unusual circumstances, the court then determines whether there is a reasonable possibility of a significant effect on the environment due to the unusual circumstances. In assessing whether the rodeo project presented any unusual circumstances, the court looked at whether the circumstances of the project differed from the general circumstances of projects covered under the exemption. The court found that the rodeo did not represent a change in the operation of the fairground, as the project was no different in nature and scope from previous fairground events. In addition, appellants did not provide any evidence that a “normal” fairground would operate any differently. Because the court found no unusual circumstances, it did not reach the second issue of whether there was a reasonable possibility of a significant effect on the environment due to such circumstances.

Second Appellate District Upholds Coastal Commission Development Permit Containing Lateral Public Access Easement

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In a short opinion, the Second Appellate District affirmed the Coastal Commission’s decision concerning a development permit issued by the County of San Luis Obispo in the case Bowman v. California Coastal Commission, Case No. B243015 (March 18, 2014). The Coastal Commission refused to lift a public access agreement contained in a coastal development permit when applicants applied for a second coastal development permit for the same property.

The subject property is approximately 400 acres in San Luis Obispo County and was owned by Walton Emmick. At the time of purchase, the property contained a single family residence and barn—both of which were in disrepair and unusable. The property includes about one mile of shoreline along noncontiguous parcels.

Emmick applied to the County for a coastal development permit (CDP) in 2002 for improvements to the house, installation of a septic system, and connection to an existing well. Emmick began to work on the residence pursuant to the construction permits, but the County told him to stop until the CDP was issued.

Emmick passed away in 2003, and the SDS Family Trust succeeded to the property. Subsequently, in 2004, the County approved the coastal development permit (CDP-1) for which Emmick had originally applied. The CPD was conditioned upon an offer to dedicate a lateral easement for public access along the shorefront portion of the property. The notice of approval informed the SDS Family Trust that it had 14 days to appeal.

No appeal was filed, but nine months later, the SDS Family Trust applied to the county for another coastal development permit (CDP-2). The permit application was for construction of a new barn to replace the existing one, which had collapsed. The application also included the same scope of work requested and approved under CPD-1 along with a request for the removal of the easement condition imposed by CPD-1. The county approved the CDP-2 application despite finding that the SDS Family Trust was in violation of the CDP-1 lateral easement condition because work had begun on the residence but no offer to dedicate had been recorded.

The Sierra Club, the Surfrider Foundation, and two coastal commissioners appealed the county’s approval of the CDP-2 application to the Coastal Commission. The appealing parties argued the county improperly eliminated a valid, existing easement which had been imposed by CDP-1. The Coastal Commission agreed with the appealing parties. The SDS Family Trust responded by filing a petition for writ of mandate, but the trial court ruled for the Commission. The trust appealed.

On appeal, the SDS Family Trust attempted to argue the access easement condition violated the Nollan and Dolan regulatory takings test. The appellate court did not reach this argument though. Instead, the appellate court pointed out that the county made a quasi-judicial determination when it granted CDP-1 and no one appealed that determination, so it became final. Therefore, the SDS Family Trust could not collaterally attack the county’s determination in a second permit proceeding after failing to exercise its administrative remedies during the first proceeding.

The SDS Family Trust then attempted to argue that they were a dissatisfied permit applicant who could simply “walk away” from the permit and apply for a new one. But the appellate court invoked the doctrine of collateral estoppel to reject this and similar arguments. The appellate court noted the purpose of collateral estoppel is to protect the finality of judgments and administrative decisions; so again, a party dissatisfied with an administrative decision must challenge that decision directly on appeal. The SDS Family Trust could walk away from the permit, but it could not walk away from County’s final determination that the lateral easement condition was a valid condition for granting the proposed permit.

This case serves as an important reminder for CEQA practitioners. While the CEQA statute is clear about the requirement that parties exhaust administrative remedies before seeking a court’s relief, this requirement applies wherever an administrative tribunal renders a quasi-judicial opinion.

Update: Court of Appeal reverses decision on rehearing.

U.S. Supreme Court Sides with Property Owners in Dispute Over Abandoned Railroad Right of Way

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Marvin M. Brandt Revocable Trust v. United States, ___ U.S. ___ (2014) No. 12-1173, March 10, 2014.

In a case that piqued the interest of many throughout the West, including property owners and outdoor enthusiasts, the U.S. Supreme Court sided with a Wyoming property owner in a dispute over an abandoned railroad right of way.  The case presented the question of what happens to a railroad’s right of way granted under the General Railroad Right-of-Way Act of 1875 when the railroad abandons it: does it go to the Government or to the private party who acquired the land underlying the right of way?  Reversing the 10th Circuit Court of Appeals, the Supreme Court ruled that the railroad’s abandoned right of way reverts to the private landowner.

The Supreme Court’s opinion begins with some extensive history regarding the settlement of the West and the federal land grant policies led to the present predicament. The opinion explained that to encourage early settlement and development of the West, Congress first passed acts giving railroad companies fee title to vast stretches of land (the land acquired by the Central Pacific – later the Southern Pacific – and the Union Pacific in exchange for their construction of the Transcontinental Railroad is a good example), but that following public complaints about the amount of land being given away, it passed the General Railroad Right–of–Way Act of 1875 to provide railroad companies only “right[s] of way through the public lands of the United States.”  I.e., just the right to use the land – not fee title. One such right of way, granted to a railroad company in 1908, crosses land that the United States later conveyed to the Brandt family in a 1976 land patent. That patent specifically stated that the land was granted subject to the railroad’s rights in the 1875 Act, but it did not specify what would occur if the railroad later relinquished those rights. Years later, a successor railroad abandoned the right of way with federal approval. In 2006, the Government sought a judicial declaration of abandonment and an order quieting title in the United States to the abandoned right of way, including the stretch that crossed the land conveyed in the 1976 Brandt patent.

Petitioners contested the claim, asserting that the right of way was a mere easement that was extinguished when the railroad abandoned it, so that Brandt now enjoyed full title to his land without the burden of the easement. The Government countered that the 1875 Act granted the railroad something more than a “mere easement,” and that the United States retained a reversionary interest in that land once the railroad abandoned it.

The 10th Circuit Court of Appeals sided with the Government. Although it acknowledged a division among lower courts regarding the nature of the Government’s interest, if any, in abandoned General Railroad Right-of-Way Act of 1875 rights of way, it concluded based on 10th Circuit precedent that the United States had retained an “implied reversionary interest” in the right of way, which then vested in the United States when the right of way was relinquished. The Supreme Court reversed.

The Supreme  Court rejected the Government’s position, in large part because the Government had won when it argued the opposite before the Supreme Court more than 70 years ago, in the case of Great Northern Railway Co. v. United States (1942) 315 U.S. 262. There, the Government argued, and the Supreme Court agreed, that the 1875 Act granted nothing more than an easement to the railroad companies. Under Great Northern, therefore, the railroad had only an easement in its right of way over the land.

The Supreme  Court  then explained that, when the United States patented the parcel to the Brandt family in 1976, it conveyed fee simple title to that land, “subject to those rights for railroad purposes” that had been granted to the railroad. The United States did not reserve to itself any interest in the right of way in that patent.

After determining that the interest granted to the railroad was nothing more than an easement and that the U.S. retained no interest, the Court noted that the essential elements of easement, including what happens when they cease to be used, are well settled as a matter of property law.  Applying basic common law principles, the Court determined that when the railroad abandoned the right of way, the easement referred to in the Brandt patent terminated. Brandt’s land became unburdened of the easement, conferring on him the same full rights over the right of way as he enjoyed over the rest of the parcel.

Justice Sotomayor issued a dissenting opinion arguing that the majority improperly brushed off pre- Great Northern precedent suggesting that the United States retained a reversionary interest in railroad rights of way and, to the extent the majority regarded Great Northern as having abrogated those precedents, it placed on Great Northern more weight than that case could bear.  She also claimed that the majority erred by relying on basic common law principles without recognizing that railroad rights of way were not always governed by the ordinary common-law regime.

Justice Sotomayor also pointed out the negative practical implications of the majority’s opinion, claiming that it “undermines the legality of thousands of miles of former rights of way that the public now enjoys as means of transportation and recreation.  And lawsuits challenging the conversion of former rails to recreational trails alone may well cost American taxpayers hundreds of millions of dollars.”

Echoing Justice Sotomayor, many rails-to-trails organizations have described the decision as a serious set-back to the hiking and bicycling trails system envisioned by Congress when it enacted the National Trails System Improvements Act of 1988; however, the decision appears to apply only to privately-held land transferred by the United States subject to an existing railroad easement that is subsequently abandoned.  Many thousands of miles of trails along former railroad routes are situated on federal, state or local public lands, or on routes that were originally conveyed to the railroad companies in fee, rather than as easement. The decision does nothing more than confirm what has for centuries been the law of easements: an easement is a right to use another’s land for a specified purpose, and when the holder of the easement expressly or impliedly abandons its use, the easement no longer encumbers the underlying land.

Sacramento Superior Court finds narrow CEQA violation in EIR prepared to address Monterey Amendments to operation of the State Water Project.

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Continuing the theme of water-related issues in California, the Sacramento County Superior Court, Judge Timothy Frawley presiding, recently addressed litigation concerning the operation of the State Water Project. On March 5, 2014, the court released its rulings in the cases Central Delta Water Agency, et al. v. California Department of Water Resources, et al. (Case No. 34-2010-80000561) and Rosedale-Rio Bravo Water Storage District, et al. v. California Department of Water Resources. (Case No. 34-2010-80000703.) The litigation in these cases involved CEQA challenges brought against an EIR prepared by the Department of Water Resources (“DWR”) for the project known as the “Monterey Amendments to the State Water Project Contracts (Including Kern Water Bank Transfer) and Associated Actions as Part of a Settlement Agreement.”

Background and History

The history of the challenged EIR stretches back to the 1960’s and the inception of the State Water Project (“SWP”). The SWP was structured so that its costs for operation are borne primarily by various public water agencies (“SWP contractors”) that contract with the state to receive SWP water. The obligations for sale, delivery, and use of SWP water were set forth in long-term contracts with these SWP contractors. As many may know, the original long-term contracts were overly optimistic when estimating the water supply which would be available at full build-out of the SWP. The original contracts anticipated that 4.2 million acre-feet of water would be available per year, but actual, reliable water supply from the SWP is now in the vicinity of 2 to 2.5 million acre-feet annually. So by the early 1990’s, the SWP was increasingly unable to fulfill demand for water deliveries.

In response to shortages in the SWP supply exacerbated by drought, DWR and the SWP contractors engaged in extensive negotiations in the city of Monterey, California. The negotiations resulted in substantial revisions to the SWP long-term water supply contracts. These revisions became known as the “Monterey Amendment.”

The Monterey Amendments established six primary objectives: (1) resolve conflicts and disputes among SWP contractors regarding water allocations and financial responsibilities for SWP operations; (2) restructure and clarify SWP water allocation procedures and delivery during times of shortage and surplus; (3) reduce financial pressures on agricultural contractors in times of drought and supply reductions; (4) adjust the SWP’s financial rate structure to more closely match revenue needs; (5) facilitate water management practices and water transfers that improve reliability and flexibility of SWP water supplies in conjunction with local supplies; and (6) resolve legal and institutional issues related to storage of SWP water in Kern County groundwater basins, and in other areas.

The Monterey Amendments included numerous  elements to achieve these objectives. For example, the so-called “urban preference” was eliminated in favor of reductions in water deliveries borne proportionately by urban and agricultural users, water rates were restructured, and various other changes were made to the way the SWP is administered. Relevant to the litigation here, the Monterey Amendment also required DWR to transfer the “Kern Water Bank” property to the Kern County Water Agency.

In 1995 the Central Coast Water Authority, as lead agency, completed and certified a final EIR (“Monterey Agreement EIR”) studying the environmental impacts of the extensive amendments to the SWP water supply contracts.  Soon after, the Planning and Conservation League and others challenged the sufficiency of this EIR (the “PCL litigation”). Among other allegations the plaintiffs argued that DWR should have been the lead agency for the purposes of preparing the EIR, and that the EIR inadequately defined the “project”. The PCL litigation reached the appellate court, where the court determined that DWR should have functioned as lead agency, and that the EIR was defective in at least one respect. The court ordered that DWR prepare a new EIR.

Following remand, the parties to the PCL litigation entered into a settlement agreement (the “Settlement Agreement”) governing how the new EIR would be prepared. The parties agreed that the proposed project to be analyzed in the new EIR would be defined during the scoping process, but at a minimum, would analyze the Monterey Amendment and certain additional terms agreed to in the Settlement Agreement. With this agreed scope the project became known as the “Monterey Plus” project, and the new EIR for the project was referred to as the “Monterey Plus EIR.”

DWR issued a draft EIR in October 2007 and certified a final EIR for the Monterey Plus project on February 1, 2010. The project studied in the EIR included all of the objectives and elements of the Monterey Amendment, along with the objectives and elements of the Settlement Agreement. The baseline used in the EIR was the continued operation of the SWP in accordance with the pre-Monterey Amendment water supply contracts. This means the EIR used 1995 as the baseline year to measure existing conditions. The EIR also provided analyses using baselines adjusted for 2003 and 2020 to account for changes in water supply and transfers resulting from decisions unrelated to the project. Since the proposed project was continued operation of the SWP under the Monterey Agreement, the EIR identified the no project alternative as a return of operation to the pre-Monterey Amendment water supply contracts. To account for uncertainty in determining what, exactly, these pre-amendment conditions would look like, the EIR analyzed four different “no project” scenarios.

The EIR determined that the project did not have any significant impacts from 1996 to 2003, but might cause some potentially significant impacts during the period from 2003 to 2020. These impacts could include impacts to biological, cultural, and paleontological resources resulting from groundwater recharge activities. The EIR also identified potentially significant growth-inducing impacts resulting from the delivery of additional SWP water to urban contractors. Even though DWR incorporated mitigation measures for these impacts, they could remain potentially significant. The EIR also determined that the project may result in potentially significant impacts due to additional pumping from the Delta and from the construction of additional ponds on the Kern Water Bank lands. But DWR incorporated mitigation measures which it determined would reduce these impacts to less-than-significant levels.

DWR recorded a notice of determination regarding its decision to adopt findings and determinations, a statement of overriding considerations, and a mitigation, monitoring, and reporting program for the project. On June 3, 2010, DWR then filed a return on peremptory writ of mandate, requesting that the trial court discharge the 2003 writ of mandate that had required the new EIR. The very same day, Petitioners Central Delta Water Agency, South Delta Water Agency, and various environmental organizations led by the Center for Biological Diversity, filed a petition for writ of mandate challenging the sufficiency of DWR’s new Monterey Plus EIR under CEQA. The Petitioners also challenged the validity of the agreement to transfer the Kern Water Bank property from DWR to the Kern County Water Agency.  At the same time, the Rosedale-Rio Bravo Water Storage District and the Buena Vista Water Storage District, each of which operates a water bank system in the vicinity of the Kern Water Bank, filed a separate CEQA action, focusing narrowly on issues of operation of the Kern Water Bank.

The Central Delta Water Agency Litigation

For the most part, the trial court rejected the claims brought by the petitioners. Notable for CEQA practitioners, the trial court declined to consider two of Petitioner’s arguments at the outset for failure to adequately summarize the record. Specifically, Petitioners cited to only a single page of the Monterey Plus EIR’s lengthy discussion regarding the issue of “paper water” (a term used to describe contractual water that may not actually exist as “wet water,” e.g., contractual water that may be beyond the contracting supplier’s ability to actually supply it) and failed to adequately summarize the evidence in the record addressing the Project’s climate change impacts.

Petitioners’ first primary challenge involved the project description element of the Monterey Plus EIR. Petitioners alleged the project description did not comply with CEQA’s requirements that it be accurate and stable. As noted above, the EIR described the Project as continued operation of the SWP under the Monterey Amendment, for which no permits or approvals are required. Petitioners argued this description of the project was confusing because it was unclear whether operation under the Monterey Amendment was the proposed project, or actually, the status quo. Petitioners submitted that this description concealed the true scope of the project. The court rejected this argument, but not without noting the unique factual circumstances of the case, a recurring theme throughout the trial court’s opinion.

The trial court stated that the litigation presented an unusual circumstance for a CEQA case because the proposed project was actually a standardized contract amendment, previously approved and executed. The court pointed out that DWR was operating the SWP pursuant to the Monterey Amendment while the new EIR was being prepared. Therefore, the Monterey Plus EIR accurately described the result of carrying out the proposed project being studied: continued operation of the SWP pursuant to the Monterey Amendment. Petitioners pointed out that this approach essentially resulted in an EIR analyzing the impacts of a decision that had already been made.

The court agreed, generally, with the assertion made by Petitioners. Under CEQA, the approach taken by DWR to prepare the Monterey Plus EIR should usually not be allowed. But in this case, the parties to the Settlement Agreement, certified by the court, approved preparation of a remedial EIR to analyze the impacts of the Monterey Amendments. Any argument that the court should have invalidated the Monterey Amendment approvals, rather than allowing DWR to continue operating under them, was time-barred. The time for petitioners to make this objection was when the Settlement Agreement was approved and the writ issued. Considering these unique circumstances, the trial court could not find that DWR abused its discretion by describing the project as continued operation of the SWP under the Monterey Amendment and Settlement Agreement.

Petitioners next argued the baseline selected in the EIR was flawed because the baseline omitted provisions of water supply contracts eliminated by the Monterey Amendment. The trial court quickly dispensed with this and other arguments attacking the baseline in the EIR. The EIR studied both existing baselines for years 1995 and 2003, and a future baseline at year 2020 to provide a complete assessment of the Monterey Amendment’s impacts. This choice of baseline was therefore supported by substantial evidence and entirely reasonable under the circumstances. Additionally, DWR’s approach was consistent with the Court of Appeal’s opinion in the PCL litigation. So again, considering the unique circumstances, DWR did not abuse its discretion by preparing an EIR in accordance with the prior Settlement Agreement and court order.

Similarly, the trial court found the range of alternatives analyzed in the EIR reasonable under the circumstances, despite Petitioners’ assertion that the EIR did not evaluate a true no-project alternative. As noted above, DWR analyzed four different no-project scenarios in the EIR. DWR adopted this approach because it identified a good faith disagreement as to what exactly conditions prior to the Monterey Amendments would look like. DWR had continued to operate the SWP with the Monterey Amendments in place even after litigation was initiated following approval of the amendments in 1995 (and it is 2014 at the time of this entry—not an insignificant passage of time). The trial court found this approach to analyzing a no-project alternative to be reasonable. The EIR provided sufficient information to the public and decision makers regarding the impacts of various potential scenarios under pre-Monterey Amendment conditions.

The trial court also rejected an argument CEQA practitioners frequently encounter: deferral of mitigation. The petitioners argued DWR improperly deferred mitigation by finding that impacts on Delta aquatic life would be reduced to a less-than-significant level after compliance with existing and future regulatory permits and processes. However, the court declared this was not a situation where an agency relied on references to compliance with existing laws to avoid compliance with CEQA. The Monterey Plus EIR conducted the appropriate impact analysis and determined that the project could have significant impacts on the delta. But DWR operations would be subordinate to existing laws and regulatory requirements including applicable SWRCB Orders, Army Corps of Engineers permits, Biological Opinions, endangered species take permits, habitat protection plants, etc. The court determined it was appropriate for DWR to rely on commitment to this existing regulatory scheme to mitigate the Project’s impacts. In fact, the court suggested it may not have even been feasible for DWR to propose additional mitigation measures separate from the existing regulatory scheme.

Finally, the court upheld the DWR’s analysis of the project’s growth-inducing impacts in the Monterey Plus EIR. The EIR concluded that the Project could potentially induce growth. DWR identified contractors that could receive additional water, calculated the amount of additional water that could be made available, and estimated the number of additional residents this new water could support. The EIR also discussed potential economic development resulting from this potential increase in population. Petitioners argued the EIR should have conducted additional, site-specific analyses of the Project’s potential growth inducing impacts, but the court found the generalized level of detail in DWR’s analysis sufficient under the circumstances and compliant with CEQA.

The Kern Water Bank Issue

The Central Delta Water Agency petitioners also challenged the portion of the Monterey Plus EIR dealing with the transfer of the Kern Water Bank property. As part of the Monterey Amendment, the Kern Water Bank property would be transferred from DWR to the Kern County Water Agency for the express purpose of developing and operating a groundwater bank.

The Central Delta Water Agency petitioners argued that the EIR failed to sufficiently describe or analyze the Water Bank’s future operations. Instead, the petitioners argued the analysis was limited to the historical operation of the water bank during the unusually wet period from 1995 to 2004. The trial court agreed the EIR insufficiently analyzed operation of the water bank, as the court explained in further detail in its Rosedale opinion.

The Rosedale-Rio Bravo Litigation

The Rosedale-Rio Bravo Water Storage District petitioners argued that the Monterey Plus EIR failed to analyze the use and operation (as opposed to merely the transfer) of the Kern Water Bank as a component of the project. Specifically, the Rosedale petitioners argued the EIR failed to adequately discuss, analyze, and mitigate potential hydrology and water quality impacts associated with the use and operation of the water bank. The trial court agreed, noting the defects in the EIR could be traced to its incomplete description of the project. The trial court pointed out that the EIR described this portion of the project as including only the transfer of the property. But the record unequivocally demonstrated that the project included not just the transfer, but also the “construction, operation and maintenance of the Kern Water Bank.”

The trial court concluded that the omission of relevant information regarding the use and operations of the Kern Water Bank was prejudicial. This omission precluded informed decision-making and informed public participation, as analysis of potential impacts associated with operation of the water bank was not included in the EIR. On this narrow ground, the Court granted the petitions in both the Rosedale and Central Delta Water Agency cases.

Conclusion

The court has ordered an additional hearing to be noticed by the parties, to discuss “an appropriate remedy for the CEQA violation,” presumably pursuant to Public Resources Code Section 21168.9(b).  This CEQA statute encourages courts to fashion remedies no broader than necessary to cure violations, i.e., any remedy “shall include only those mandates which are necessary to achieve compliance with [CEQA] and only those specific project activities in noncompliance with [CEQA].”

Here, the court identified violations in only a narrow area of the Monterey Plus EIR dealing with the Kern Water Bank. It seems reasonable that DWR could argue for, and the court would accept, a narrow remedy upholding the majority of the Monterey Plus EIR while requiring additional, focused analysis on the operation of the Kern Water Bank.

CA Legislature and Governor Brown Enact Extensive Drought Relief Plan

General Posted by   

In response to the unprecedented drought the State is facing in 2014, the California Legislature recently enacted emergency drought legislation. The two measures, SB 103 and SB 104, received bipartisan support in both the Senate and Assembly before being signed into law by Governor Jerry Brown on Saturday, March 1, 2014.

The bills allocate substantial funds, approximately $687.4 million, to support drought relief in drought-afflicted communities throughout the State. The dispersion of more than $500 million in existing water bond funding will be expedited for local projects already planned or under way. Examples of these projects include improvement of storm water capture, expanded use of recycled water, enhanced groundwater management and recharge, and expanded water conservation. Other funds, including revenue from the AB 32 cap-and-trade auctions, will also be made available for drought-relief efforts through provisions in SB 103 and SB 104.

The bills include various other provisions beyond simple monetary relief. For example, sanctions have been enhanced for certain conduct, like illegal diversion of water, during drought years. The bills also direct the California Department of Public Health to adopt new groundwater replenishment regulations by July 1, 2014. This leaves only four months for the department to draft and adopt new regulations—a tall order for any agency engaging in rulemaking bound to impact many interests. And in California under current conditions, no topic is likely to be much more controversial than water supply.  After all, in the West, water is what we fight over.

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