In Protect Niles v. City of Fremont (2018) 25 Cal.App.5th 1129, the First District Court of Appeal held that the record contained a “fair argument” that a mixed-use project in an historic district might have significant aesthetic impacts on the historic character of the community due to the project’s size and scale. The court also cited residents’ concerns regarding traffic hazards and congestion, and concluded that the city was required to prepare an EIR.

The City of Fremont adopted a zoning overlay district to protect the historic character of the community of Niles, a small commercial strip dating to the 19th century. A developer proposed a mixed-use project with 98 residential units on a vacant six-acre property at the gateway to this district. Neighbors complained that the buildings were too tall, and the project was too dense, so that it was incompatible with the area and would increase traffic congestion. The city’s architectural review board recommended denying the project. The planning commission recommended approval, and the city council adopted a mitigated negative declaration and approved the project. Neighbors sued. The trial court found that the record contained a “fair argument” of potentially significant impacts relating to aesthetics and traffic, and granted the writ. The developer appealed.

In May 2018, the city published a draft EIR for the project. The neighbors moved to dismiss the appeal as moot because the city had decided to comply with the trial court’s writ. The appellate court declined to dismiss the appeal. The city was not a party to the appeal. The developer’s submittal of a revised application did not mean the original project was abandoned. Moreover, the appeal was not moot because, were the developer to prevail, the city’s original approvals would be reinstated regardless of the new application.

Turning to the merits, the court concluded that the project’s visual impact on its setting – in this case, an historic commercial “main street” recognized as sensitive by the city – was a proper subject of review, over and above the analysis of the project’s impact on historic resources. According to the court, the record “clearly” contained a fair argument that the project would have a significant aesthetic impact on the historic district. The city’s initial study found that the project was aesthetically compatible with the district because it reflected the architectural style of the industrial buildings that previously occupied the site, and the city’s design guidelines recognized that architecture within the district was varied. Members of the architecture review board and of the public, however, stated that the project was too tall and dense, and inconsistent with Niles’ village-like character. These complaints continued even after the developer modified the project. The court recognized the “inherently subjective” nature of aesthetic judgments, but found that the comments “were not solely based on vague notions of beauty or personal preference, but were grounded in inconsistencies with the prevailing building heights and architectural styles of the Niles [district] neighborhood and commercial core.” Commenters included members of the city’s historic architectural review board, who recommended denial.

The court rejected the developer’s various arguments that the project’s aesthetic impact was not significant. First, although the site was largely vacant and unkempt, that did not automatically mean that development of the site would be an upgrade. Second, the site, though on the edge of the historic district, was nevertheless located at a recognized gateway to Niles, and was within the district’s boundaries. Third, the architectural review board’s recommendation to deny the project was not a bare conclusion, but was supported by record evidence of the board members’ (whom the court presumed to have historic aesthetic expertise) underlying aesthetic judgments about the effect of the project. Thus, the board’s “collective opinions” on project compatibility with the historic overlay district were substantial evidence supporting a fair argument that the project may have significant aesthetic impacts. Though the court noted that, were the city to prepare an EIR, the city could conclude that the project would not have a significant impact on aesthetics “because aesthetics is an inherently subjective assessment.”

The court also found that the record contained a fair argument concerning traffic safety. The project’s traffic study concluded a left-turn pocket lane was warranted at the project entrance. Staff did not recommend the pocket, however, because left-turn pocket lanes generally were not located elsewhere along the street, and because omitting a pocket would make vehicles slow down. Testimony from residents, however, stated that drivers did not adhere to the posted speed limit, and sight lines might not be adequate if multiple drivers queued up to turn left into the project site. These “fact-based comments” were substantial evidence supporting a fair argument that a new intersection at the project entrance could have significant traffic impacts.

The record also contained a fair argument that the project could contribute to existing traffic congestion. Residents testified that traffic at a nearby intersection was already terrible, and that during the morning commute traffic already backed up from this intersection to the project site. The city’s own traffic study found that traffic at this intersection was Level of Service (“LOS”) E – an unacceptable level of congestion under the city’s standards – and that project-related traffic would cause congestion there to worsen to LOS F. The developer argued that, under the city’s thresholds of significance, a shift from LOS E to LOS F was not a significant impact. The court held, however, that the city’s significance threshold could not be applied to foreclose consideration of substantial evidence that the impact might be significant. The court again found that the “fact-based comments of residents and city staff and officials supported a fair argument that unusual circumstances in Niles might render the thresholds inadequate to capture the impacts of congestion on Niles Boulevard.”