In Banning Ranch Conservancy v. City of Newport Beach, the Court of Appeal upheld the city’s EIR for the Newport Banning Ranch Project and held that the city complied with its own general plan. In reaching the latter conclusion, the Fourth Appellate District both distinguished and disagreed with the Third Appellate District’s holding in California Native Plant Society v. City of Rancho Cordova (2009) 172 Cal.App.4th 603.

In 2012, the City of Newport Beach approved the Newport Banning Ranch Project. The project is located on 400 acres of coastal property in Orange County. The project site is home to both oil wells and endangered species. Because the property is in the city’s sphere of influence, the city was asked to approve the project. The city studied the environmental impacts of the project in a 9,000 page EIR before conditionally approving the project. The approvals recognized that the project could not go forward without a number of subsequent actions by other agencies. For the purposes of the litigation, the most important approvals would come from the California Coastal Commission.

The litigation focused on two issues related to the Commission and the Coastal Act. The petitioner argued that the city violated CEQA when it did not identify “environmentally sensitive habitat area” or ESHA in the EIR. The city, for its part, pointed out that EIR evaluated the biological impacts in detail, identifying potential impacts to species and habitat, and adopting mitigation for those impacts. The city insisted, however, that the designation of ESHA was not a biological determination to be made in the EIR, but rather was a legal and policy determination that would ultimately be made by the Commission under the Coastal Act. The city argued that by providing all of the data and scientific analysis that the Commission would need to make such a conclusion, it satisfied CEQA; it argued that the EIR did not speculate as to the Commission’s ultimate conclusions citing Banning Ranch Conservancy v. City of Newport Beach (2012) 211 Cal.App.4th 1209. The court agreed. It held that the city did not have to “prognosticate as to the likelihood of ESHA determinations” in the EIR.

The more significant issue tackled by the court was a claim under the Planning and Zoning Law. The city has a policy in its general plan which requires it to “work with” various resource agencies to identify wetlands and other habitat to be preserved, restored, and developed on the Banning Ranch property. The city did reach some consensus with some agencies on these points, but did not reach an amical point with the Coastal Commission. Indeed, the city consulted and met in person with the commission on a couple of occasions, but a meeting of the minds appeared remote at the time of project approval.

The petitioner cited to the Third District Court of Appeal’s opinion California Native Plant Society v. City of Rancho Cordova, arguing that the City of Newport Beach had to do more to try to reach agreement with the Coastal Commission before approving the project. California Native Plant Society v. City of Rancho Cordova involved a similar policy in Rancho Cordova’s general plan. Rancho Cordova’s policy required the city to “coordinate” with resources agencies to develop mitigation prior to project approval. The Third District in that case held that this policy required something more than merely consulting with the agency, soliciting comments, and responding to them. The court held that “coordination” meant something more than consultation, although whatever that “something more” was it did not have to amount to “abdication.”

The Fourth District considered whether the City of Newport Beach’s policy was similar to Rancho Cordova’s. The court concluded that it was not altogether similar, but it was similar enough that the two could not be readily distinguished. The court nevertheless upheld the City of Newport Beach’s actions. In doing so, the Fourth District rejected the reasoning of the Third District in California Native Plant Society. It held that the Third District’s holding was “incompatible with our deferential review of the City’s legislative acts.” While requiring agencies to work together to reach a consensus “might be good or bad ideas,” the obligations were not set out in either general plan. Without some standard by which to guide the city’s behavior, the court could not readily enforce the obligation to “coordinate with” but not necessarily “capitulate to” the will of another agency, without treading on the legislative authority of the city. The court held that such an obligation should not be invented out of thin air, and in any event was unworkable.

RMM attorneys Whit Manley and Jennifer Holman represented the City of Newport Beach.