The controversy in this case arose after the City of San Diego declined to approve conditional use permits (CUPs) for three cell tower facilities operated by American Tower Corporation. The city had previously granted 10-year CUPs for the facilities, and American Tower applied for new CUPs after the originals expired. The city considered the applications and informed American Tower of concerns with the design of the facilities, particularly with regard to aesthetic impacts, but otherwise determined that the applications were exempt from CEQA. The city ultimately denied the CUP applications. American Tower then filed suit in federal district court, raising claims under California’s Permit Streamlining Act. American Tower Corp. v. City of San Diego (Aug. 14, 2014) Case No. 11-56766.
California’s Permit Streamlining Act
Under California’s Permit Streamlining Act, the city was required to act on the CUP applications within 60 days of the city’s exemption determination. The city did not meet this deadline, and American Tower argued that the CUP applications became approved as a matter of law based on the city’s failure to act within 60 days. The district court found this argument compelling, but the Ninth Circuit reached a contrary conclusion.
The Ninth Circuit noted that the Permit Streamlining Act causes a CUP application to become approved by default only if two conditions are met: the lead agency must fail to take action within 60 days and public notice, as required by law, must have occurred. In this case, the appellate court concluded that the required public notice had not occurred, so the CUP applications could not be deemed approved.
To determine whether public notice had occurred prior to the CUP approvals, the appellate court looked to statutory provisions of the San Diego Municipal Code and the constitutional, due process protections articulated by the California Supreme Court in Horn v. County of Ventura. The court determined that the city complied with the notice requirement, so the issue became whether automatic approval of the CUP applications without an opportunity for affected landowners to be heard would “constitute a substantial or significant deprivation of other landowners’ property interests” under the framework established in Horn.
The Ninth Circuit determined that adjacent property owners might be concerned about the visual impacts of the sizable cell towers and hundreds of square feet of adjacent equipment shelters allowed by the CUPs. Therefore, the court had “little trouble” finding that automatic approval of the CUP applications would significantly infringe upon other landowners’ property interests. The City’s notices were silent on the Permit Streamlining Act default approval provision, and American Tower failed to make use of the act’s self-help provisions. Under the act, an applicant may either file an action in court to compel the lead agency to provide public notice and hearing, or the applicant may file its own public notice of the proposed action. So in this case, for example, American Tower could have filed a public notice that the CUP applications would be deemed approved if the city failed to act within 60 days after finding the CUPs exempt from CEQA. But no notice was provided to affected landowners here, so the CUP applications could not be deemed automatically approved under the act.
The Federal Telecommunications Act
American Tower advanced multiple claims under the Federal Telecommunications Act, all of which both the district court and the Ninth Circuit rejected.
Under the Telecommunications Act, a state or local agency must support decisions to deny placement of telecommunications equipment with substantial evidence, measured in the context of applicable state and local law. In this case, the San Diego Municipal code requires that CUP applications comply with, “to the maximum extent feasible,” regulations of the local land development code. American Tower failed to prove that its proposed facilities were designed “to be minimally invasive,” despite being given numerous opportunities by the city’s planning department to submit such evidence. As a result, the court found that the city supported its decision to reject the CUP applications with substantial evidence.
The Ninth Circuit also agreed with the district court that American Tower and the city were not “similarly situated” for the purposes of analyzing whether the city unreasonably discriminated against American Tower. The court noted that while the city maintained telecommunications equipment, this equipment was predominately for public services. Further, the city did not advertise available wireless space, though it did maintain some private leases, so any evidence of competition between the city and American Tower was minimal. In any event, the court found that the alleged discrimination in this case would be reasonable. The Telecommunications Act only prohibits unreasonable discrimination. Since aesthetic concerns are legitimate concerns for a locality, it was not unreasonable for the city to reject the CUP applications based on those concerns.
Finally, the Ninth Circuit held that American Tower did not support a claim under the Telecommunications Act, which mandates that regulation of telecommunications equipment not prohibit the provision of wireless services. An applicant must demonstrate that the manner in which it proposes to fill a significant wireless services gap “is the least intrusive on the values that the denial sought to serve.” Here, the city denied the CUP applications based on aesthetic concerns, and American Tower failed to meet its burden by submitting evidence that the proposed towers and structures were the least intrusive proposals.
Analysis and Conclusion
This opinion applies state law to a common, and sometimes contentious, local land-use planning issue: permitting the placement of telecommunication equipment. The case notes the limits on the power of the Permit Streamlining Act to provide default approval of a permit application, and the court implicitly encourages applicants to make use of the act’s self-help provisions in instances where lead agencies are uncooperative. This case also demonstrates the importance local regulations in the permitting and placement of telecommunications equipment.