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First District Court of Appeal Upholds EIR for Marin Desalination Plant

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On May 21, 2013, the First District Court of Appeal issued its decision in North Coast Rivers Alliance v. Marin Municipal Water District (2013) __ Cal.App.4th __ (Case No. A133821, A135626). The case involved a challenge to an EIR prepared for a desalination plant in Marin County.  The trial court had found that the analysis in the EIR was inadequate in several areas and that new information added to the EIR required recirculation.  The Court of Appeal reversed.

Background

In August 2003, the District proposed building a desalination plant in San Rafael. The District circulated a draft EIR for the project in November 2007 and released the final EIR in December 2008.  The final EIR included a new Alternative 8, which discussed water conservation and diverting water from the Russian River as an alternative to desalination. The District certified the final EIR in February 2009 and approved the project in August 2009.  In September 2011, the trial court ruled the EIR was inadequate in various respects, and adequate in others.  The District appealed.

Aesthetic Impacts

The court began with a discussion of the EIR’s analysis of aesthetic impacts caused by three proposed water tanks—one on Tiburon Ridge (“Ridgecrest A tank”) and two on San Quentin Ridge. The EIR concluded that the intervening topography and existing vegetation would prevent the Ridgecrest A tank from having a significant effect on scenic vistas. The EIR included a detailed discussion of potential aesthetic impacts of development of the Ridgecrest A tank, including the size and shape of the tank, satellite image analysis from several directions, visual simulation and impacts on vistas from homes, hiking trails and the highway.  The court held that the analysis constituted substantial evidence to support the conclusion that the tank’s impact would be less than significant.  The court noted that distinguishing between substantial and insubstantial adverse environmental impacts was a policy decision that must be made by the lead agency based, in part, on the setting.  The Alliance’s disagreement with the EIR’s conclusions did not mean those conclusions were deficient.

The EIR further concluded that, unlike the Ridgecrest A tank, the two San Quentin Ridge water tanks would have a significant aesthetic impact and proposed a mitigation measure that required the District to work with a landscape architect and the nearby cities of San Rafael and Larkspur to create a landscaping plan to “soften” the view of the water tank. The landscaping plan “would identify success metrics such as survival and growth rates for the plantings.” The Alliance argued, and the trial court had agreed, that the mitigation measure was improperly deferred and indefinite. The Court of Appeal disagreed.  It held that the mitigation measure was acceptable in this situation because the mitigation was known to be feasible and practical considerations prevented the District from establishing more specific standards early in the process.   The measure was sufficient because it committed the District to mitigation and set out a standard for the landscaping plan to follow:  to reduce and soften the visual intrusion of the tanks.  Although the specific details of how mitigation would be achieved under the plan were deferred until the construction phase, the EIR gave adequate assurance that visual impacts would be mitigated by the selection and location of appropriate plantings.

The Alliance’s third argument regarding the water tanks was that the EIR failed to address whether Ridgecrest A tank was inconsistent with the Countywide Plan. The court found the analysis was supported by substantial evidence. Under CEQA, only inconsistencies with plans require analysis and here, the EIR analyzed the one inconsistency (with the plan’s open space designation) and mitigated it. The court held that the trial court’s ruling, which faulted the District for not mentioning each of the specific elements or policies in the Countywide Plan that could be affected, was tantamount to requiring the EIR to provide a detailed discussion of the Project’s consistency with the plan. The court noted that CEQA includes no such requirement.

Seismology

Turning next the EIR’s seismology analysis, the court held that the EIR adequately analyzed liquefaction and health and safety impacts related to earthquakes.  The EIR’s seismology analysis provided detailed information on geologic conditions in the area, and considered the potential for seismic hazards including ground shaking and liquefaction.  The EIR also considered seven potential impacts associated with seismic risks.  Moreover, the EIR required project features and components to be built to withstand seismic activity and in compliance with applicable standards in the Building Code.  The court therefore, held that the EIR’s analysis of seismic impacts was adequate.

Hydrology and Water Quality Impacts 

The next issue addressed by the court was the hydrology and water quality impacts of the project. The trial court had ruled that the EIR did not contain an adequate discussion of the frequency of shock-chlorination treatments and that it lacked substantial evidence to support the District’s conclusion that untreated chlorinated water would not be discharged into the Bay. The Court of Appeal disagreed here as well and found that the analysis was adequate.  The EIR described the shock-chlorination process, its frequency, and wastewater disposal and evaluated whether wastewater produced by the project could impact water quality.  It further explained that testing conducted for the project supported the conclusion that shock-chlorinating chemicals would not cause water quality impacts in receiving waters.  The court held that this explanation was sufficient.  Because the District had determined that the project impact was insignificant, the EIR did not need to include a more detailed analysis.

Biological Resources 

Holding that the EIR’s analysis of biological impacts was adequate, the court rejected the Alliance’s arguments regarding entrainment, the environmental baseline, and pile driving.  Regarding entrainment, the trial court had concluded that the evaluation methodology used for the EIR’s analysis of entrainment was inadequate because it did not follow the recommendations of the California Department of Fish and Game and the National Oceanic and Atmospheric Administration Fisheries to conduct monthly source water sampling. The District explained in the EIR that, instead of monthly sampling, it chose peak abundance periods to conduct the sampling to overestimate the impacts. The District also responded to NOAA Fisheries and CDFG’s requests for additional data by explaining that further sampling was impractical.  The court held that the mere difference of opinion regarding sampling methods was not enough to invalidate the EIR.

The court held the baseline was appropriate because the District used project specific studies and decades of CDFG data and did not base the description solely on two months of water sampling, as the Alliance had alleged.   The EIR considered the various species of fish that may be affected by the project.  The court found that the description of the environmental setting was more than adequate.

The EIR had also found that there would be a potential significant impact on the environment from the reconstruction of a pier, which would require driving up to 175 concrete piles into the Bay. In order to mitigate this impact, the District adopted a mitigation measure that required the District to consult with NOAA Fisheries to find appropriate measures and to monitor the area during the pile-driving activities. Moreover, the District was required to comply with the Endangered Species Act section 7 consultation requirement. The trial court found that these mitigation measures were not sufficiently specific. Once again, the appellate court disagreed.  Finding that the mitigation was adequate, the court noted that a condition requiring compliance with environmental regulations is a common and reasonable mitigating measure.

Energy and Greenhouse Gas Emissions

The trial court had ruled that the EIR’s discussion of energy impacts was inadequate because it did not discuss a particular alternative­­—the use of green energy credits to mitigate energy impacts. The appellate court held, however, that because the EIR had found that the energy impacts would be insignificant, there was no requirement to discuss mitigation measures. The court also upheld the EIR’s greenhouse gas emissions analysis, which concluded that “the Project would not interfere with achieving a 15 percent reduction in GHG emissions,” satisfying Marin’s Cities for Climate Protection campaign. Additionally, the District voluntarily committed to purchase only renewable energy for the project. The Alliance argued that this was a vague and unenforceable policy.  But the court held that no mitigation was required for GHG emissions because there was no finding of significant impact. Even so, the court went on to find that the EIR contained substantial evidence showing the feasibility of adhering to this commitment.

Recirculation 

The final argument discussed by the court was whether the EIR needed to be recirculated when Alternative 8 was added to the final EIR. The trial court had found that Alternative 8 represented a significant new feasible solution to the project objectives, and therefore, recirculation was required. The appellate court, however, found that Alternative 8 was neither feasible nor significantly “new” enough to warrant recirculation. Alternative 8 was infeasible because it would not provide reliable potable water in a drought year – one of the project objectives.  That was because the alternative relied in part on increased imports from the Russian River, and there was substantial uncertainty regarding whether such increases would ever be allowed.  The alternative was not sufficiently new because there was an alternative in the draft EIR that discussed conservation as an alternative to the project. Given these facts, the District had substantial evidence to support its decision not to recirculate the EIR. Recirculation, the court emphasized, is an exception rather than the general rule.

Whit Manley of Remy Moose Manley, LLP, Chris Butcher of the Thomas Law Group, and District General Counsel Mary Casey represented MMWD.

 

Fourth District Court of Appeal Requires EIR for Upgrade of High School’s Athletic Facilities Because the Project May Cause Significant Impacts on Parking and Traffic

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On April 25, 2013, the Fourth District Court of Appeal ordered publication of its decision in Taxpayers for Accountable School Bond Spending v. San Diego Unified School District (2013) __ Cal.App.4th __ (Case No. D060999). The appellate court reversed the trial court’s decision to reject a California Environmental Quality Act (CEQA) cause of action brought against the school district for adopting a mitigated negative declaration (MND) for a project to upgrade a high school’s athletic facilities. In particular, the court found it was improper for the district to adopt the MND because the athletic facilities project may have significant traffic and parking effects.

Around October 2010, the San Diego Unified School District completed an initial study for a project to upgrade Hoover High School’s athletic facilities, including replacement of the bleachers and installment of new field lighting at the football stadium. The district planned to use funds from a 2008 proposition that authorized the school district to sell $2.1 billion in bonds for various construction and rehabilitation projects listed or described in the proposition measure. The district adopted the initial study and an MND for the Hoover High project on January 11, 2011, and filed a notice of determination the next day. In February 2011, the plaintiff organization (“Taxpayers”) filed suit against the district, ultimately alleging four causes of action: 1) violation of CEQA, 2) misuse of proposition funds, 3) violation of the city’s zoning and land use laws, and 4) improperly exempting the project from the city’s zoning and land use laws. After the trial court dismissed all four causes of action, Taxpayers appealed.

The Fourth District started its discussion of the CEQA claim with an overview of general principles and proceeded to apply the fair argument standard in its de novo review of the issues. First, the court found the initial study’s project description was not misleading just because it did not place a limit on the number of evening events that would be held each year.  The district had estimated in the initial study that there would be about 15 evening events plus a “few more” due to unforeseen events.  The court interpreted a “few more” to mean about three or four more evening events, for a total of 15-19 evening events per year.  Since Taxpayers did not cite any statutory or other legal authority requiring the District to identify a finite limit on the number of events that could be held annually, the court found this description was accurate and complied with CEQA. It did, however, warn that additional CEQA review would be necessary if the district chose to increase the number of events beyond the 15-19 range in the future.

Next, the court found the project’s installment of lighting would not have a significant environmental effect. The court expressly noted that testimony of individual community members regarding the aesthetic or lighting effects of the project could not constitute substantial evidence showing a significant effect because CEQA is concerned with how a project will affect the environment in general, not how it will affect particular persons.  The court also agreed with the initial study’s conclusion that the vertical illuminance caused by the four new 90- or 100-foot light standards would not significantly impact nearby residences because of the lighting’s limited hours of operation, the limited number of evening events, landscaping features, and the small number (seven or less) of affected residences.

The court then dismissed Taxpayers’ argument that the project would have a significant impact on historical resources. The court found the record did not contain substantial evidence that any historical resources existed near Hoover High, nor any evidence showing that any potential historical resources may be substantially affected by the project.

Finally, the court addressed issues regarding traffic and parking impacts. As a preliminary matter, the court noted that the lack of a reasonable estimate of expected attendance at future events could make the district’s assessment of traffic and parking impacts inadequate. The court disapproved of the district’s choice to base projected attendance at future Hoover High evening football games on the average attendance of games at five other high schools in the district. The court found that the district should have calculated and considered the actual attendance at past Hoover High afternoon football games as a baseline figure for estimations of attendance at future evening games. Because the district did not have sufficient information about the estimated attendance, the court determined it could not have properly reached a conclusion about the potential significance of the project’s impacts on parking and traffic.

The court further agreed with Taxpayers that the district could not rely on San Franciscans Upholding the Downtown Plan v. City and County of San Francisco (2002) 102 Cal.App.4th 656 (SFUDP), for the argument that a parking shortage cannot constitute a significant physical impact on the environment because it is merely a “social inconvenience.” The court found the SFUDP court’s discussion of parking was likely dicta, and disagreed with any holding that parking shortages can never constitute a physical impact on the environment. The court reasoned that vehicles are “physical objects that occupy space when driven and when parked” so they “naturally must have some impact on the physical environment.” In contrast to its discussion of aesthetic and lighting impacts, the court found that personal observations by local residents about parking could constitute substantial evidence that the project may have a significant impact on parking. Similarly, the court found that comment letters from residents about the traffic impacts were sufficient to support a fair argument the project may have a significant effect on traffic. Because the project may cause significant parking and traffic effects, the court held that the district must prepare an Environmental Impact Report.

First District Court of Appeal Upholds Limited Remedy for a CEQA Violation; Allows Eminent Domain Activities to Move Forward on East Bay Trail Improvement Project

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On April 12, 2013 the First District Court of Appeal issued its decision in Golden Gate Land Holdings, LLC v. East Bay Regional Park Dist. (2013) ___Cal.App.4th___ (Case No. A135593).  The court upheld the trial court’s decision to allow, pursuant to Public Resources Code section 21168.9, severable, existing project activities to go forward while CEQA defects relating to future project activities were remedied.

The case involved the acquisition of land for a trail improvement project in the East Bay. The East Bay Regional Park District adopted a resolution of necessity to condemn eight acres along the shoreline owned by Golden Gate Land Holdings (GGLH). The district sought to acquire this land to complete a shoreline park and to construct a segment of the San Francisco Bay Trail. The district found the project was categorically exempt from CEQA. GGLH sued, arguing the district should have prepared an EIR. The trial court agreed and granted the petition, but did not direct the district to rescind its resolution of necessity. The court instead ordered the district to vacate only its CEQA exemption finding, permitting the district to leave its resolution of necessity intact and proceed with its condemnation action. The trial court ordered, however, that the district must not actually acquire the property without first complying with CEQA.

On appeal, GGLH argued the trial court’s remedy was improper. It argued that, after concluding the district had violated CEQA, the trial court was required to direct the district to vacate all project-related approvals, including its resolution of necessity. GGLH argued that the district’s CEQA violation—an improper conclusion that the project was categorically exempt— encompassed the whole of the district’s decision and there was no way to distinguish one aspect of the project from another. Thus, according to GGLH, the trial court should not have allowed any portions of the project to proceed under Public Resources Code section 21168.9. The Court of Appeal disagreed.

According to the court, the entire “project” consisted of acquiring and developing the shoreline property for public recreation.  Project activities, however, could be parsed and consisted of initiating eminent domain proceedings, acquiring the land, and constructing the improvements.  The court held that the first activity – launching the condemnation process by adopting a resolution of necessity – could properly be severed from the remainder of the project under section 21168.9.  It would not cause impacts and there was no evidence that, by continuing the eminent domain proceedings, the district would prejudice its future consideration or implementation of alternatives or mitigation measures.  In particular, allowing that action to proceed would not prejudice the district’s CEQA analysis, so long as the district did not commit to a particular trail alignment by actually acquiring the land prior to completing the CEQA process.  Similarly, construction of the park and trail improvements could not occur until after the district completed the CEQA process.  Thus, the trial court did not misinterpret section 21168.9, or abuse its discretion in exercising its equitable powers by issuing a limited writ and allowing the eminent domain proceedings to continue.

 

Construction of the Merced to Fresno Section of the California High Speed Train Ready to Move Forward After CEQA Suits Settled

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On April 18, 2013, Judge Timothy Frawley of the Sacramento Superior Court approved a stipulated judgment resulting in the dismissal of the remaining petition challenging the initial Merced to Fresno section of California’s proposed high-speed train system (HST). The petitioners—Merced County Farm Bureau, Madera County Farm Bureau, Chowchilla Water District, Preserve Our Heritage, and individual agricultural landowners—and the California High Speed Rail Authority (HSRA) entered into a settlement agreement, which provides for additional mitigation for agricultural land impacts from the construction of the Merced to Fresno section of the HST in exchange for dismissal of the lawsuit. James Moose, Sabrina Teller, and Chris Stiles of Remy Moose Manley, LLP supported the California Attorney General’s Office in representing the HSRA in a set of consolidated lawsuits challenging the EIR prepared for the Merced to Fresno section.

On May 3, 2012, the HSRA certified the Final EIR/EIS for the Merced to Fresno section of the proposed HST. The Merced to Fresno section of the planned 800-mile system is roughly 65 miles long through the northern San Joaquin Valley, with portions along and adjacent to the existing UPRR and BNSF tracks. The project approvals drew three CEQA lawsuits in June 2012. The City of Chowchilla and a group of Valley landowners dismissed their two suits earlier this year. In November 2012, Judge Frawley denied the Farm Bureau petitioners’ motion for preliminary injunction to halt HSRA activities in furtherance of the construction of the Merced to Fresno section. A hearing on the merits of the petition was to be held on April 19, 2013.

In the settlement, the HSRA agreed to   a number of commitments focused on agricultural land mitigation, communications with agricultural landowners during the right of way process, and mitigation for impacts to Chowchilla Water District’s facilities.. Per the terms of the stipulated judgment, the court retains jurisdiction over the parties to enforce the agreement.

With this recent settlement there are currently no legal impediments for the HSRA to move forward with the construction of the Merced to Fresno section of the HST, which is expected to start in the summer of 2013. [Jeannie Lee]

Updated SB 731, CEQA Modernization Act of 2013, released by Steinberg

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A revised version of SB 731, the CEQA Modernization Act of 2013, has been released by California pro tem Darrell Steinberg. This bill includes numerous but limited revisions to CEQA, with a focus on streamlining the approval process for what the bill considers to be environmentally beneficial projects. Various revisions address transportation issues and infill development to further facilitate the Sustainable Communities Strategy previously adopted by SB 375. The most substantive revisions to CEQA in SB 731 are described below.

One provision addressed in SB 731 revises Government Code section 65457, which exempts residential development projects from CEQA within specific plan areas for which an EIR has been certified. Under the current law, this exemption cannot be applied if an event specified in CEQA (Pub. Resources Code) section 21166 occurs. The revision states, that for the purposes of Government Code section 65457, an event specified in CEQA section 21166 does not include “any new information consisting solely of argument, speculation, unsubstantiated opinion or narrative, evidence that is clearly inaccurate or erroneous, or evidence of social or economic impacts that do not contribute to, or are caused by, physical impacts on the environment.” This provision could reduce redundancy in EIR preparation by making the use of tiering under these circumstances more defensible.

SB 731 also proposes standardized thresholds of significance for environmentally beneficial projects. This revision directs the Office of Planning and Research to propose revisions to the CEQA Guidelines establishing thresholds of significance for noise and for transportation and parking impacts of qualifying projects within “transit priority areas.” In addition, this revision declares that aesthetic impacts of qualifying projects within transit priority areas shall not be considered significant impacts on the environments. The bill does not prevent local jurisdictions from considering aesthetic impacts pursuant to local ordinances or other discretionary powers.

Another substantive revision addresses preparation of the administrative record in CEQA cases. The bill would add section 21167.6.2 to CEQA, which describes a process by which the administrative record is prepared concurrently with the administrative process, and documents must be made available electronically to the public shortly after receipt by the lead agency. This process will be applied to projects of statewide, regional, or areawide environmental significance, or if requested by the project applicant.

SB 731 would also amend Section 21091 of the Public Resources Code and related provisions of law to establish clear statutory rules under which “late hits” and “document dumps” are prohibited or restricted prior to certification of an EIR, if a project proponent or lead agency has not substantively changed the draft EIR or substantively modified the project.

The bill would also revise CEQA section 21081.5 to require agencies to make findings described in section 21081 available in draft form for public review at least fifteen days prior to approval of the proposed project.

The revised SB 731 also adds a provision to section 44273 of the Health and Safety Code to provide funding of up to $30 million annually to the Strategic Growth Council in order to fund planning activities for transit priority projects by local agencies.

Finally, SB 731 revises CEQA section 21168.9, which describes how courts should proceed when issuing a writ of mandate in a CEQA action. Section 21168.9 already encourages courts to issue detailed writs which are no more broad than necessary to address defects in the CEQA process. The revised section 21168.9 requires even further specificity in a writ of mandate. The bill can be viewed at: http://ct3k1.capitoltrack.com/Bills/13Bills/sen/sb_0701-0750/sb_731_bill_20130423_amended_sen_v98.pdf  [John Wheat]

California Supreme Court Denies Petition for Review of the Fourth District’s Decision in Banning Ranch Conservancy v. City of Newport Beach

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On December 12, 2012, the Fourth District Court of Appeal upheld the City of Newport Beach’s EIR for the Sunset Ridge Park Project, rejecting a claim that the city had engaged in impermissible “piece-meal” environmental review of a park project that was proposed next to a mixed-use village.  Banning Ranch Conservancy v. City of Newport Beach (2012) 211 Cal.App.4th 1209.

On March 27, 2013, the Supreme Court of California denied a petition for review.  The Court of Appeal’s decision is now final.  The City may finally begin constructing the 13.7-acre park with active and passive recreational uses that was proposed in 2009.

Appellant Banning Ranch Conservancy, which first filed its petition for writ of mandate in trial court in April of 2010, had alleged that the City violated CEQA by not analyzing all the effects of the neighboring mixed-use Newport Banning Ranch project in the park project’s EIR.  The Court of Appeal disagreed, finding that the Newport Banning Ranch project would not be a “consequence” of the City’s park project even though a park access road would be constructed through the Newport Banning Ranch property.  The court also rejected all of the conservancy’s claims that the EIR had not adequately addressed the park project’s environmental impacts, including cumulative and growth-inducing impacts.  RMM Partner Whitman F. Manley and Senior Counsel Jennifer S. Holman represented the City of Newport Beach in the litigation. [Elizabeth Sarine]

 

California Environmental Protection Agency Releases Statewide Pollutant Mapping Tool

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On April 23, 2013, the California Environmental Protection agency released its California Communities Environmental Health Screening Tool, or CalEnviroScreen. This mapping tool was developed jointly by CalEPA and the Office of Environmental Health Hazard Assessment (OEHHA) “for evaluating multiple pollutants and stressors in communities.” The mapping tool is intended as the next step in implementation of CalEPA’s 2004 Environmental Justice Action Plan, which called for guidance on the analysis of multiple pollution sources and their impacts on California communities.

The mapping tool tracks, by zip code, how various communities are affected by eleven types of pollution and environmental factors such as pesticides, heavy vehicle emissions, hazardous waste, and other toxic factors. The mapping also takes into account overall community health based on seven population and socioeconomic factors such as residents living below the poverty line, average education levels, and occurrences of asthma within the populations. Together, these factors allow the CalEPA to address issues concerning environmental justice, or “the fair treatment of people of all races, cultures, and incomes with respect to the development, adoption, implementation and enforcement of environmental laws, regulations, and policies.”

The mapping will affect how state funding for environmental improvement projects is directed towards different communities. State law requires that twenty-five percent of proceeds from greenhouse gas cap-and-trade auctions be invested in projects that benefit disadvantaged communities. Despite providing an important first-step in identifying highly impacted communities, the CalEPA press release warns that the mapping tool has some limitations. First, it is not directly applicable to analysis of cumulative impacts required by CEQA because it compares the relative burdens on communities but does not provide an absolute measure of those burdens. Second, the tool is not a substitute for a formal risk assessment measuring health concerns for the same reason.

The CalEPA indicates that the tool will undergo future revisions and will include additional factors, such as water quality information and other census information. The CalEnviroScreen version 1.0 was released after the circulation of two public review drafts, 12 public workshops, and more than 1,000 public comments and questions. The report is available at: http://www.oehha.ca.gov/ej/ces042313.html [John Wheat]

Northern California District Court strikes down BLM gas and oil leases for failure to comply with NEPA

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On March 31, 2013, the District Court for the Northern District of California filed its decision in Center for Biological Diversity v. Bureau of Land Management (Case No. C 11-06174 PSG). Plaintiffs Center for Biological Diversity and Sierra Club challenged a decision by the Bureau of Land Management (BLM) to sell oil and gas leases on federal land in Monterey and Fresno counties. Plaintiffs argued BLM failed to comply with the National Environmental Policy Act (NEPA) and the Mineral Leasing Act (MLA) of 1920 and moved for summary judgment. The court determined that the leases violated NEPA, but not the MLA.

 The leases were for proposed oil and gas extraction from the Monterey Shale Formation. Oil and gas trapped in these shale formations was not accessible until improvements in hydraulic fracturing (fracking) techniques in the late 2000’s made extraction from these types of formations economically feasible. Previously, fracking only allowed oil and gas to be extracted in a limited zone radiating from wells drilled vertically into shale formations. Advances in drilling techniques have facilitated horizontal drilling at distances of 1,000 to 6,000 feet from a vertical extraction well.

 Before approving oil or gas development on public lands, federal agencies must comply with both the MLA and the Federal Land Policy Management Act (FLPMA) and undergo a “three phase decision-making process.” First, an agency prepares a Resource Management Plan. Second, the agency leases specific parcels, and third, the lessee submits an application for a drilling permit.

 In 2006, the BLM prepared a proposed Resource Management Plan/Final Environmental Impact Statement (PRMP/FEIS) regarding management of the Southern Mountain Diablo Range and Central Coast of California (subject area). The PRMP/FEIS included a “Reasonably Foreseeable Development Scenario for Oil and Gas” (RFD), which projected no more than 15 new wells over the next 15-20 years. The PRMP/FEIS addressed potential impacts of oil and gas development in the subject area.

 In 2011, BLM proposed a competitive oil and gas lease sale for approximately 2,700 acres in the area and prepared a corresponding draft environmental assessment (EA). Numerous comments submitted during the public review period expressed concerns surrounding fracking and climate change, but the BLM asserted that these issues were outside the scope of the EA. The EA considered air quality, water quality and special status species issues and evaluated three alternatives to the proposed leases. The EA did not discuss fracking in detail, arguing it was not relevant to its analysis of impacts. BLM asserted that site-specific impacts of fracking would be analyzed when permits to drill were submitted. Based on this EA, the BLM released a finding of no significant impact (FONSI) regarding the proposed leases. Plaintiffs protested the lease sale, but BLM dismissed the protest and the plaintiffs sued.

 BLM argued that NEPA analysis was not required for at least two of the leased parcels because these leases contained no surface occupancy provisions (NSO leases) that courts have previously determined function as a “right of refusal” rather than an actual lease for drilling. Therefore, the NSO leases did not constitute an “irretrievable commitment of resources.” However, two of the leases sold by BLM did not contain NSO provisions, and the court determined that BLM lacked the authority to unilaterally deny a permit based on any surface activity. As a result, the court found BLM was required to conduct a thorough NEPA analysis to determine if the sale would have a substantial environmental impact.

BLM argued that its previously prepared EA and FONSI sufficiently concluded that the lease sales would not have a substantial environmental impact. The court noted, however, that BLM based its analysis of the lease sale on the projection that only one well would be drilled across the four parcels to be leased. BLM reached this conclusion based on past data indicating that in the previous 20 years, none of the lease sales in the subject area had production wells drilled on them. Therefore, BLM reasoned that only one exploratory well would result from the leases. The court determined this approach failed to take into account all “reasonably foreseeable” possibilities as required by NEPA. The court noted evidence in the record indicated BLM’s approach was not reasonable due to the recent, dramatic advances in fracking technology. The court criticized the BLM for simply ignoring the potential for fracking by claiming it was outside the authority or jurisdiction of the agency. The court concluded that BLM unreasonably refused to consider the effects of fracking, due to the “reasonably close causal relationship” to the agency action (lease sales of federal land) at issue.

BLM also asserted that the EA was tiered from the regional management plan for the general subject area. The court rejected this argument because it determined that the 2006 PRMP/FEIS did not consider the potential concerns raised by fracking, having made no mention of fracking at all. BLM argued the PRMP/FEIS implicitly considered fracking in its projection of how many wells would be drilled on BLM land. The court determined, however, that BLM’s own statement that it lacked jurisdiction to consider the impacts of fracking in the EA contradicted its assertion that the PRMP/FEIS considered fracking. Further, the court found that evidence in the record demonstrated that the PRMP/FEIS did not address the scale of fracking resulting from newly developed techniques.

Finally, BLM argued that because the exact scope and extent of potential fracking that would occur on the subject property was unknown, NEPA analysis was appropriate for site-specific proposals. The court rejected this argument, noting that NEPA requires agencies to consider the range of possible environmental effects prior to committing resources. The court determined, based on the record, that it was unreasonable for BLM not to consider the potential for fracking operations resulting from the lease sales not including NSO provisions.

The court also found that the BLM’s refusal to consider the potential impacts of fracking on leased parcels tainted the assessment of “intensity factors” in its FONSI. For example, the BLM held that the project was not highly controversial, but the record included numerous comments from environmental groups and federal and state agencies raising serious concerns regarding the potential environmental impacts of fracking. BLM declined to acknowledge these concerns. Next, the court found BLM erroneously analyzed the potential effect of leases on public health and safety, particularly with regards to contamination of drinking water sources, as the record demonstrated that the proposed leases were located in close proximity to important freshwater sources. Finally, the court determined BLM unreasonably “discounted the uncertainty from fracking” that could have been resolved by further data collection. The court faulted BLM for failing to collect any data particular to the areas that would be affected by the leases. Instead, BLM merely summarized general data about fracking before dismissing the issue. Ultimately, these deficiencies in the environmental analysis of the lease sales led the court to conclude BLM had failed to take the requisite “hard look” at the issue that NEPA requires.

 As a separate issue, the plaintiffs argued the BLM violated the MLA, which requires that all leases of lands for oil or gas production be subject to a condition requiring the lessee to “use all reasonable precautions to prevent waste of oil or gas developed in the land…” The BLM leases included a provision requiring the lessees to use “reasonable precautions” to prevent waste, but the plaintiffs argued the leases also should have incorporated specific requirements to minimize waste. The court disagreed and determined that the MLA does not require lessees to use specific technologies, even if reasonable or economically viable. BLM therefore satisfied the MLA requirement. (John Wheat)

Judge Rules Portion of AB 900 Unconstitutional

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On September 27, 2011, Governor Jerry Brown signed AB 900 into law. AB 900 was designed to expedite environmental review under CEQA of certain “leadership projects.” To qualify under AB 900, projects must exceed $100 million and not result in any net additional greenhouse gas emissions, among other requirements.  One of the primary benefits for leadership projects under AB 900 is that any CEQA challenge will proceed directly to the Court of Appeal, significantly reducing the potential for lengthy litigation. This provision was intended to help get major construction projects off the ground sooner.

The provision of AB 900 allowing CEQA litigation to proceed directly to the appellate courts was challenged by the Planning and Conservation League, which claimed the law improperly removed jurisdiction from trial courts and weakened CEQA. (See Conservation League v. State of California (Alameda Sup. Ct. Case No. RG1262904).)

Judge Frank Roesch of Alameda County Superior Court, ruling from the bench on March 29, 2013, struck down this provision as unconstitutional for being “inconsistent with the constitutional mandates of where writs of mandate can be brought.” Petitioners did not challenge AB 900’s other provisions, including the minimum investment thresholds, job creation requirements, and greenhouse gas emission limit. Judge Roesch’s ruling leaves in place some time limits and other fast-tracking mechanisms available under AB 900. Currently, two solar energy projects and an office and research campus infill project have applied for qualification under AB 900. The State has not yet announced whether it will appeal the lower court’s ruling. [John Wheat]

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