Tag: CEQA

FIRST DISTRICT UPHOLDS STATE WATER RESOURCES CONTROL BOARD’S RELIANCE ON CEQA’s MINISTERIAL EXEMPTION FOR REGISTRATION OF APPROPRIATION OF WATER FOR DOMESTIC USE UNDER THE WATER RIGHTS PERMITTING REFORM ACT

In Mission Peak v. State Water Resources Control Board (2021) 72 Cal.App.5th 873, the First District Court of Appeal held that the State Water Resources Control Board’s (Board’s) registration process is ministerial and therefore exempt from CEQA.

Background

The Water Rights Permitting Reform Act of 1988 permits eligible persons to acquire a right to appropriate up to 10 acre-feet per year of  water for domestic or other specified uses by completing a registration process with the Board. Pursuant to this Act, the State Water Resources Control Board granted a small domestic use registration to two Alameda County property owners without conducting environmental review on the premise that the action was ministerial and thereby did not trigger CEQA.

Mission Peak Conservancy and Kelly Abreau (collectively, Mission Peak) sued the Board, alleging that it violated CEQA by approving the registration without conducting CEQA review. Mission Peak contended that the Board’s approval was discretionary and that it should have denied the registration because the property owners did not qualify for small domestic use and also because their registration form contained false information. The Board filed a demurrer, which the trial court sustained without leave to amend. Mission Peak appealed.

Court of Appeal’s Decision

The Court of Appeal determined that the Board’s registration process was indeed a ministerial act, not discretionary, and was therefore exempt from CEQA pursuant to Public Resources Code section 21080, subdivision (b)(1). As the court explained, “[m]inisterial projects involve ‘little or no personal judgment by the public official as to the wisdom or manner of carrying out the project.’ (Guidelines, § 15369.) . . . The test is whether the law governing the agency’s decision to approve the project gives it authority to require changes that would lessen the project’s environmental effects.”

The court determined the Board did not have such authority here. Although the Board has statutory authority to impose general conditions applicable to all registrations, it did not have authority “to place conditions on the . . . registration to lessen its environmental effects.” The Board determines whether a registration is compliant by applying a checklist of fixed criteria, and the registration is automatically deemed complete if it meets these criteria. Accordingly, there is no discretion involved in the registration, and it is therefore not subject to CEQA.

Specifically, the Court rejected Mission Peak’s argument that “a different agency, the Department of Fish and Wildlife, has discretion to impose conditions that could ameliorate the project’s environmental impacts” and therefore the the process is discretionary. Not so. As the court explained, another agency’s discretionary authority for its review cannot be imputed to the Board. Mission Peak then argued that “the project did not satisfy the requirements for a small domestic use registration because the [applicant] misrepresented facts,” and thereby the Board did have discretion in that it could deny the project or request changes to meet program requirements. But, “the test is whether the Board had the legal authority to impose environmentally beneficial changes as conditions of the project,” not whether the agency could request changes on an application or deny it.  Lastly, Mission Peak argued that the Board violated CEQA because the project did not meet program requirements. The court pointed out that “this is simply an argument that the Board made an erroneous ministerial decisions.” And such an error is not the basis for a CEQA claim. Plainly stated, “CEQA does not regulate ministerial decisions—full stop.”

– Veronika S. Morrison

SIXTH DISTRICT HOLDS COASTAL COMMISSION VIOLATED CEQA BY FAILING TO COMPLETE ENVIRONMENTAL REVIEW OF COASTAL DEVELOPMENT PERMIT PRIOR TO PROJECT APPROVAL

In Friends, Artists, and Neighbors of Elkhorn Slough v. California Coastal Commission (2021) 72 Cal.App.5th 666, the Sixth District Court of Appeal held that the California Coastal Commission (CCC) violated CEQA by analyzing a coastal development permit’s environmental impacts and adopting findings in support thereof after it had approved the permit and underlying project. Although the CCC is authorized to issue “revised findings” when the Commission’s action differs from what was proposed in the staff report, the court held that the revised findings in this case went too far and were an improper pot-hoc rationalization.

Background

In 2000, Real Party in Interest Heritage/Western Communities, Ltd., applied to the County of Monterey for a combined development permit and coastal development permit (CDP) for the Rancho Los robles Subdivision. The project proposed more than 100 residential units on a commercial parcel. Monterey County prepared an EIR containing several alternatives, including one with a reduced number of units.

In 2008, the County Planning Commission recommended denying the project due to water supply and traffic congestion issues. Heritage/Western appealed the denial to the County Board of Supervisors. The Board disagreed with the Planning Commission and approved the project. The Board also certified the EIR and adopted a statement of overriding considerations regarding significant and avoidable impacts to traffic, groundwater, and seawater intrusion.

In 2009, Friends, Artists, and Neighbors of Elkhorn Slough (FANS) appealed the Board’s decision to the CCC, alongside two Coastal Commissioners. CCC staff issued a staff report recommending denial of the CDP primarily due to lack of adequate water supply. The staff report concluded further analysis for certain issues was unwarranted in light of staff’s recommendation to deny the permit.

On November 8, 2017, the CCC held a de novo hearing and voted to approve the CDP, despite staff recommending denial.

In August 2018, CCC staff issued a subsequent report, containing revised findings in support of the CCC’s approval of the CDP. The 2018 report concluded that water supply was no longer an issue that necessitated denying the project. The 2018 staff report also considered other impacts previously identified in the 2017 report and determined they were no longer relevant or significant, and that staff’s prior conditions of approval would still apply to the project but be adjusted where necessary and implemented in a manner consistent with the project as approved by the Commission. Finally, the report concluded that the project was consistent with CEQA because it adequately addressed any potential adverse impacts to coastal resources, and there were no additional feasible alternatives or mitigation measures that would substantially lessen adverse impacts. The CCC approved the revised findings at a public hearing on September 13, 2018, approximately ten months after the CDP was approved.

FANS filed a petition for writ of mandate challenging the CCC’s approval of the CDP. The trial court denied the petition, rejecting FANS’ assertion that the CCC violated CEQA by approving the project without conducting environmental review before making findings. FANS appealed.

Court of Appeal’s Decision

On appeal, FANS asserted that the CCC failed to employ the proper procedures required by CEQA and the Coastal Act because its “revised findings” were a post-hoc rationalization for the CCC’s prior decision to approve the project and went beyond what was permitted by the CCC’s regulations. The Court of Appeal agreed and reversed the trial court.

The Court of Appeal outlined the steps for seeking CCC review of an approved CDP application and noted that the Commission’s de novo review of a permit application mimics CEQA’s environmental review process. The analysis and recommendation in a staff report must be accompanied by specific findings regarding—among other factors—the project’s conformity with the Coastal Act and CEQA. If the CCC’s action on the project substantially differs from staff’s recommendation, the prevailing Commissioners must separately state the basis to allow staff to prepare a revised staff report with proposed revised findings that reflect the action taken by the Commissioners. Under section 13096 of the CCC’s regulations, a public hearing must be held before the revised findings are adopted. (Cal. Code Regs., tit. 13, § 13096, subd. (c).) After the hearing, the CCC must vote on whether to adopt the revised findings.

Based on the facts of the case, the court held that the CCC’s environmental review for the CDP was incomplete at the time of approval, and the revised finding did not make up for the shortcoming. The court determined that the CCC’s decision to approve the project relied on a staff report that failed to contain elements required by CEQA (and the Commission’s certified regulatory program), including project alternatives, feasible mitigation measures to substantially lessen significant adverse effects, and conditions of approval.

In reaching its conclusion, the court explained the importance of these factors: “Requiring specific findings about alternatives and mitigation measures ‘ensures there is evidence of the public agency’s actual consideration of alternatives and mitigation measures, and reveals to citizens the analytical process by which the public agency arrived at its decision.’ [Citation.]” (Opinion, p. 32.) Through this lens, the court clarified that section 13096 “requires commissioners to set forth the analytic route between the evidence and the action at the hearing before approval.” The court further observed that no prior case law involved facts similar to this one, where the CCC’s environmental analysis was this incomplete at the time a CDP was approved. Accordingly, the court found that the CCC abused its discretion because it was required to conduct the analysis before it approved the project.

– Bridget McDonald

FOURTH DISTRICT UPHOLDS EIR FOR ROADWAY CONNECTION PROJECT AND HOLDS CITY’S QUASI-LEGISLATIVE APPROVALS WERE NOT SUBJECT TO PROCEDURAL DUE PROCESS REQUIREMENTS

In Save Civita Because Sudberry Won’t v. City of San Diego (2021) 72 Cal.App.5th 957, a partially published opinion, the Fourth District Court of Appeal held that the City of San Diego did not violate CEQA by failing to summarize revisions made in its recirculated draft EIR, and that the City’s certification of the Final EIR and approval of the project were quasi-legislative acts not subject to procedural due process requirements.

Background

In 2008, as part of an alternative to a proposed mixed-use development project, the City of San Diego proposed a four-lane major roadway in Mission Valley that would directly connect the development to local roadways. This connector roadway required an amendment to the Serra Mesa Community Plan (SMCP) and the City’s General Plan.

In April 2016, the City issued examined this connector roadway as its own project and prepared a programmatic draft EIR (PDEIR) for the SMCP and General Plan amendments. In March 2017, when roadway construction became foreseeable and upon a large volume of public comment, the City issued a revised and recirculated draft EIR (RE-DEIR) that looked at both the programmatic portion of the project, the adoption of amendments, as well as the actual construction of the roadway. In August 2017, the City issued the Final EIR for the project. Also in August 2017, the Planning Commission voted unanimously, with one member recusing, to recommend approval of the project and certification of the FEIR, with the City Council’s Smart Growth & Land Use Committee voting the same a month later. The City Council certified the Final EIR and approved the project in October 2017.

Save Civita Because Sudberry Won’t (Save Civita) filed a petition for writ of mandate and complaint for declaratory and injunctive relief challenging the City’s certification of the Final EIR and approval of the project on several grounds, namely here that it violated the requirement in CEQA Guidelines section 15088.5, subdivision (g) that a recirculated EIR summarize the revisions made to the prior EIR, and also that it violated procedural due process rights. The trial court denied the petition and complaint. Save Civita appealed.

The Court of Appeal’s Decision

Save Civita argued that the City violated CEQA Guidelines section 15088.5, subdivision (g), because it failed to summarize the changes in the RE-DEIR from the PDEIR, thereby forcing readers to “‘leaf through thousands of pages,’” and cause them “‘to have the mistaken belief’” that the two EIRs address the same project. The Court of Appeal disagreed, holding that statements in the RE-DEIR adequately summarized the changes to the PDEIR, and that these summary provisions informed the public that the revisions to the PDEIR were extensive and the PDEIR had been effectively “replaced” by the RE-DEIR. To make its determination, the court also looked to section 15088.5, subdivision (f), which requires that an agency inform the public that, when an EIR is so substantially revised that the document is recirculated, then comments on the prior EIR will not receive a response. The City fulfilled this criteria.

Furthermore, the court concluded that even if the City had failed to comply with the summation requirements of section 15088.5, any such failure was not prejudicial because it did not deprive the public of a meaningful opportunity to discuss and critique the project. Specifically, the court noted that the administrative record contained “ample and vigorous” public discussion of the RE-DEIR, proof that there were not fatal obstacles to public discourse created by any absence of a revision summary.

Save Civita also argued that the City’s certification of the Final EIR and project approval violated the public’s procedural right to due process and a fair hearing because a member of the City Council, who voted to approve the project was, according to Save Civita, “‘a cheerleader for the Project’” who had predetermined his vote. The court foreclosed this claim by explaining that procedural due process requirements are applicable only to quasi-adjudicatory hearings. Here, the City’s actions were quasi-legislative because they involved the adoption of generally applicable rules on the basis of broad public policy. The project approved by the City and analyzed in its EIR—construction of the roadway and amendment of planning documents—were, as the court determined, matters of public policy that required it to assess a broad spectrum of community costs and benefits. Therefore, procedural due process did not apply.

– Veronika S. Morrison

Second District Holds That Labor Union’s Interest in CEQA Action Was Not Sufficiently Direct and Immediate for Permissive Intervention

In South Coast Air Quality Management District v. City of Los Angeles (2021) 71 Cal.App.5th 314, the Second District Court of Appeal upheld the trial court’s decision to deny a labor union’s motion for permissive intervention in a CEQA case.

Background

This case involved the City of Los Angeles’s issuance of a permit authorizing a shipping company owned by the Chinese government to construction of a terminal within the Port of Los Angeles. In 2008, the City completed an EIR that concluded that the project would have significant and unavoidable environmental impacts. The EIR incorporated over 50 mitigation and lease measures to reduce these impacts.

In 2020, the City prepared a revised EIR that eliminated some of the mitigation measures required in the 2008 EIR. The revised EIR also concluded that the project would have significant, unavoidable, and increased impacts on air quality, and that it would exceed a threshold for cancer risk. The 2020 EIR did not contain enforcement provisions for the mitigation measures, did not require a lease amendment, and did not require the project applicant to implement or pay for the mitigation measures.

The South Coast Air Quality Management District filed a petition for writ of mandate, claiming that the City violated CEQA by failing to enforce the measures required by the 2008 EIR, and certifying the 2020 EIR, allowing the project to operate under allegedly inferior measures.

The petition named the City of Los Angeles, the Los Angeles City Council, the Los Angeles Harbor Department, and the Los Angeles Board of Harbor Commissioners as respondents, and several shipping companies as real parties in interest.

The California Attorney General and the California Air Resources Board sought permissive intervention pursuant to Code of Civil Procedure section 387, subdivisions (d)(1) and (d)(2). The trial court granted both parties’ motions.

The International Longshore and Warehouse Union, Locals 13, 63, and 94 also sought permissive intervention, arguing that no existing party could advocate for its members’ interests adequately. Specifically, the Union claimed that it was the only party that could properly protect the 3,075 jobs at stake. The trial court denied the Union’s motion, determining that its interest was speculative and consequential, rather than direct and immediate, as required for permissive intervention. The Union appealed.

The Court of Appeal’s Decision

The Court of Appeal upheld the trial court’s denial of the Union’s motion for permissive intervention. The court explained that pursuant to Code of Civil Procedure section 387, the statute for permissive intervention, there must be a balancing of the interests of those affected by a judgment against the interests of the original parties in pursuing their case unburdened by others. It also emphasized that trial courts are afforded broad discretion to strike this balance, and that the reviewing court reviews for abuse of discretion—reversing only if the appellant establishes the decision results in a miscarriage of justice or exceeds the bounds of reason.

The court further explained that the Union failed to articulate any unique interest that was not already represented by the other parties. The court found that the Union’s position on the merits was duplicative, that it had no concerns with the actual environmental analysis in the 2020 EIR, and that it was not the only party advocating for a remedy that did not result in a shut down of the project or rescission of its permits. Therefore, the Court of Appeal concluded that it was reasonable for the trial court to determine that the Union’s participation in the case would be largely cumulative and would unduly complicate an already complex case involving numerous parties, and to accordingly deny the Union’s motion for permissive intervention.

Third District Holds Order Requiring a Limited EIR Is Not an Appropriate Remedy Where a Project May Have Significant Impacts

In the published portions of Farmland Protection Alliance v. County of Yolo (2021) 71 Cal.App.5th 300, the Third District Court of Appeal held that a limited environmental impact report (“EIR”) is not an appropriate remedy where a court finds that substantial evidence supports a fair argument that the project might have a significant environmental impact.

Background

The Yolo County Board of Supervisors adopted a mitigated negative declaration and issued a conditional use permit for a bed and breakfast and commercial event facility on agriculturally-zoned property. Project opponents filed a lawsuit alleging, among other claims, that the MND was inadequate under CEQA. The trial court rejected most of petitioners’ claims but found substantial evidence supported a fair argument that the project may have a significant impact on three special-status species, and as the remedy, (1) ordered the County to prepare a limited EIR addressing only the project’s impacts on the three species, and (2) allowed the project to continue operations pending further environmental review.

Petitioners appealed the trial court’s decision, arguing that the court violated CEQA by ordering preparation of a limited EIR after its finding of potentially significant impacts, and allowing the project to continue operating while further environmental review was pending.

The Court of Appeal’s Decision

The Court of Appeal held that Public Resources Code section 21168.9 does not authorize a court to split a project’s environmental review across two types of documents, such as a negative declaration or mitigated negative declaration and an EIR. The court noted that while section 21168.9 is designed to provide a trial court with flexibility in crafting remedies to ensure compliance with CEQA, it does not authorize a court to circumvent CEQA’s mandatory provisions. According to the court, CEQA requires an agency to prepare a full EIR when substantial evidence supports a fair argument that any aspect of the project may have a significant effect on the environment. The Court of Appeal therefore found that the trial court erred by ordering preparation of a limited EIR after finding the fair argument test had been met as to impacts to the three species.

The Court of Appeal declined to consider petitioners’ argument that the trial court erred in allowing the project to operate while the limited EIR was being prepared. While the appeal was pending, the County filed a return to the peremptory writ of mandate stating the limited EIR ordered by the trial court had been certified.  As a result, the Court of Appeal determined the portion of the judgment allowing the project to continue to operate no longer had any effect, and therefore, the issue was moot.

Fourth District Upholds City of Tustin’s Reliance on CEQA’s Infill Exemption for a Costco Gas Station and Parking Lot

In Protect Tustin Ranch v. City of Tustin (2021) 70 Cal.App.5th 951, Division Three of the Fourth District Court of Appeal upheld the City of Tustin’s reliance on CEQAs’ categorical exemption for infill projects, holding that the petitioner failed to show that the project did not meet the requirements for the exemption or that an exception to the exemption applied.

Background

This case involves a proposal by Costco Wholesale Corporation to build a gas station next to an existing Costco warehouse in the Tustin Ranch area of the City of Tustin. The project site is already developed with a shopping center and is surrounded by commercial uses, as well as some residential development.

The project includes two components: (1) a 16-pump gas station with a canopy and landscaping, and (2) the demolition of an existing Goodyear Tire Center and parking lot, which would be replaced with a new 56-stall parking lot.

The planning commission voted to approve the project and adopted a resolution finding that the project is categorically exempt from CEQA under CEQA Guidelines section 15332 (Class 32, Infill Development Projects).

Members of the public appealed the planning commission’s decision to the city council. The staff report for the city council hearing explained why staff believed the project fell within the infill exemption. It also explained that, although Costco’s initial application indicated that the project site is 11.97 acres, the project site (i.e., the portion of the site to be developed) is actually only 2.38 acres.

The city council agreed with the planning commission and staff that the project is exempt under the infill exemption. The city council adopted a resolution finding the project categorically exempt and approved the project. In doing so, the city council expressly found that the project did not present any unusual circumstances as compared to other projects that would qualify for the exemption.

The trial court upheld the city’s determination that the project is categorically exempt from CEQA review. Petitioner appealed.

The Court of Appeal’s Decision

To qualify for the Class 32 infill exemption, a project must meet five criteria: (1) the project must be consistent with the general plan and with the zoning code, including all applicable general plan policies and zoning regulations; (2) the project must be located within city limits on a site that is no larger than five acres and is surrounded by urban uses; (3) the site must have no value as habitat for special-status species; (4) approval of the project must not cause any significant impacts related to air quality, noise, traffic, or water quality, and (5) the site must be adequately served by utilities and public services. (CEQA Guidelines, § 15332.)

Petitioner challenged the city’s reliance on the infill exemption only with respect to the size of the project, arguing that the project does not qualify for the exemption because the project site is larger than five acres. The court explained that the city’s conclusion that the project site is five acres or less is a factual determination to which the court applies the deferential “substantial evidence” standard of review. Under this standard, the court does not weigh conflicting evidence. Rather, the court must uphold the agency’s determination if it is supported by any substantial evidence in the record as a whole. In the case before it, explained the court, multiple documents in the administrative record confirmed that the size of the project site is 2.38 acres. For instance, Costco’s revised development application states that the “area of work” would be 2.38 acres, inclusive of the new gas station and parking at the demolished Goodyear site. A water quality management plan and maps of the project also showed that the site is 2.38 acres.  Additionally, at the city council’s hearing on the project, city staff clarified that the total project site was calculated by adding together the acreages of both components of the project—1.74 acres for the gas station and 0.64 acres of new surface parking where the Goodyear center would be demolished. Thus, held the court, substantial evidence supports the city’s determination that the project fits within the requirements of the infill exemption.

The court next considered whether the “unusual circumstances” exception to the categorical exemption applies. CEQA Guidelines section 15300.2, subdivision (c), provides that “[a] categorical exemption shall not be used for an activity where there is a reasonable possibility that the activity will have a significant effect on the environment due to unusual circumstances.” If a project meets the requirements of a categorical exemption, the burden is on the party challenging the exemption to produce evidence supporting an exception. The Supreme Court, in Berkeley Hillside Preservation v. City of Berkeley (2015) 60 Cal.4th 1086, explained that this showing may be made in two ways. First, the challenger may identify evidence that the project will have a significant environmental impact. Alternatively, the challenger may show that the project is unusual because its features distinguish it from others in the exempt class, and that there is a “reasonable possibility” that the project will result in a significant environmental impact due to that unusual circumstance. The substantial evidence standard applies to an agency’s determination that there are no unusual circumstances. But the less deferential “fair argument” standard applies to the question of whether there is a reasonable possibility that the unusual circumstances may cause a significant effect.

Petitioner argued that the unusual circumstances exception applied for three reasons. First, the project is located on a former Goodyear Tire Center where tires were installed and oil and other fluids were changed. Second, the proposed gasoline fueling station with 16 pumps is unusually large. And third, Costco proposed to re-route traffic during peak hours. The court summarily rejected these arguments, however, because petitioner had failed to explain why these features made the project unusual compared to other projects qualifying for the infill and exemption. In fact, evidence in the record showed that the project is similar to other Costco gas stations in California and is not unusually large—as evidenced by the fact that the project is less than five acres in size. The court went so far as to question whether the size of a project can be a characteristic that makes an otherwise exempt infill project unusual, since the infill exemption is expressly limited to projects less than five acres in size.

Petitioner further argued that the city’s reliance on the exemption was improper because the city should undertake studies to determine whether the project would contaminate soils. The court rejected this argument, however, explaining that unsupported assumptions and speculation are not enough to require the city to conduct CEQA review. By law, a categorically exempt project is deemed not to have potentially significant impacts unless the project’s administrative record shows that an exception to the exemption applies. Here, petitioner failed to show an exception applies. The fact that the project may have a significant environmental impact is not a sufficient basis to require CEQA review for a categorically exempt project.

Implications

This case highlights the standard of review that the courts will apply to an agency’s determination that a project is categorically exempt from CEQA. The burden of showing that the “unusual circumstances” exception applies is on the petitioner. In this case, the petitioner did not offer any concrete reasons or evidence showing that the project is distinct from other projects qualifying for the in-fill exemption. Therefore, the court upheld the city’s reliance on the exemption.

THIRD DISTRICT FINDS EIR FOR OLYMPIC VALLEY RESORT PROJECT FAILED TO ADEQUATELY CONSIDER IMPACTS TO LAKE TAHOE’S UNIQUE ENVIRONMENTAL RESOURCES

In Sierra Watch v. County of Placer (2021) 69 Cal.App.5th 86, the Third District Court of Appeal found that the EIR for a resort development project in Olympic Valley violated CEQA because it contained an inadequate description of the environmental setting and failed to adequately consider the project’s potential air quality, water quality, and noise impacts on Lake Tahoe and the surrounding Basin.

FACTUAL & PROCEDURAL BACKGROUND

In 1983, Placer County adopted the Squaw Valley General Plan and Land Use Ordinance to guide development and growth within the Olympic Valley (formerly Squaw Valley) area. The 4,700-acre area lies a few miles northwest of Lake Tahoe in the Sierra Nevada mountains.

In 2011, Real Party in Interest Squaw Valley Real Estate LLC proposed the first project under the general plan and ordinance—the Village at Squaw Valley Specific Plan—which included two components to be built over a 25-year timeframe: (1) an 85-acre parcel that included 850 lodging units, approximately 300,000 square feet of commercial space, and 3,000 parking spaces (“the Village”); and (2) an 8.8-acre parcel that included housing for up to 300 employees (“the East Parcel”).

The County approved the project and certified its associated EIR in 2016. Following the County’s approval, Sierra Watch filed a petition for writ of mandate, alleging the County violated CEQA in numerous ways. The trial court rejected Sierra Watch’s claims. Sierra Watch appealed.

COURT OF APPEAL’S DECISION

In the published portion of the opinion, the Third District considered whether the EIR sufficiently described the project’s environmental setting and adequately considered water quality, air quality, and noise impacts.

EIR’s Description of the Environmental Setting

The court first considered whether the EIR’s discussion of the environmental setting adequately addressed Lake Tahoe and the Lake Tahoe Basin, particularly with respect to the settings for water and air quality.

Water Quality Setting

As to water quality, the Court of Appeal agreed with Sierra Watch’s assertion that the EIR’s hydrology and water quality analysis failed to adequately describe the regional setting specific to Lake Tahoe. Though the Draft EIR explained that the project would be “located within the low elevation portion of the approximately eight square mile Squaw Creek watershed, a tributary to the middle reach of the Truckee River (downstream of Lake Tahoe),” it concluded that VMT generated by the project would not exceed TRPA’s cumulative VMT threshold, and thus, would not affect the Lake’s water quality. The court rejected this rationale by noting that the EIR’s description failed to discuss the importance of the Lake’s current condition or the relationship between VMT and the Lake’s water clarity and quality, thereby depriving the public of an ability to evaluate and assess impacts on the Lake.

Air Quality Setting

As to air quality, the court found that the EIR’s description of the air quality setting and baseline was more substantial, and thus, adequate. The EIR properly explained the applicable air quality standards and presented data on the current concentrations and sources of criteria air pollutants in the area.

EIR’s Analysis of Impacts

Air Quality Impacts

The court agreed with Sierra Watch’s assertion that the EIR failed to meaningfully assess the project’s traffic impacts on Lake Tahoe’s air quality. The EIR concluded the project would not exceed TRPA’s cumulative VMT threshold but acknowledged it would likely exceed TRPA’s project-level VMT threshold for basin traffic. Nevertheless, the EIR ultimately concluded that TRPA’s VMT significance thresholds did not apply because the project was not located in the Tahoe Basin. The court found this rationale “provided mixed messages.” Rather than summarizing and declaring TRPA’s VMT thresholds as inapplicable, the court held that the EIR should have determined whether the Project’s impacts on Lake Tahoe and the Basin were potentially significant.

The court also agreed that the EIR underestimated the Project’s expected cumulative VMT in the Basin by failing to consider expected VMT from other anticipated projects. Even though the County addressed this issue in post-FEIR responses to comments, the court held that the public was denied an opportunity to “test, assess, and evaluate the newly revealed information and make an informed judgment as to the validity of the conclusions to be drawn therefrom.”

Construction Noise Impacts

The court rejected Sierra Watch’s initial assertion that the EIR failed to adequately disclose the duration of construction noise at any specific location, particularly at the Village parcel. The EIR properly explained that that portion of the Project would be constructed over 25 years based on market conditions, and thus, it would be too speculative to identify specific noise levels for every single receptor.

The court agreed, however, with Sierra Watch’s assertion that the EIR failed to analyze the project’s full geographic range of noises by ignoring activities occurring farther than 50 feet from sensitive receptors. The court reasoned that a “lead agency cannot ignore a project’s expected impacts merely because they occur…’outside an arbitrary radius.’” The EIR only considered impacts to sensitive receptors within 50 feet of construction—yet, according to the court, “ignore[d] potential impacts to a receptor sitting an inch more distant[,] even though the noise levels at these two distances would presumably be the same.” Though the County explained this analysis was standard practice, the court contended that an agency “cannot employ a methodological approach in a manner that entirely forecloses consideration of evidence showing impacts to the neighboring region [and] beyond a project’s boundaries.”

Finally, the court agreed that mitigation requiring “operations and techniques … be replaced with quieter procedures where feasible and consistent with building codes and other applicable laws and regulations” was too vague because “in effect, [it] only tells construction contractors to be quieter than normal when they can.” The court concluded that the measure improperly deferred which construction procedures can later be modified to be quiet but did not explain how these determinations are to be made.

– Bridget McDonald

*RMM Attorneys Whit Manley, Andee Leisy, Chip Wilkins, and Nathan George represented Real Party in Interest Squaw Valley Real Estate LLC in this litigation. 

Fourth District Court of Appeal Upholds Denial of Anti-SLAPP Motion to Strike Malicious Prosecution Claim in CEQA Lawsuit with Respect to Defendants, but Not Their Attorneys

In Dunning v. Johnson (2021) 64 Cal.App.5th 156, a project developer (“Cal Coast”) sued defendant Clews Horse Ranch (“the Ranch”) and its attorneys (“attorney defendants”) for malicious prosecution in response to the Ranch’s earlier lawsuit alleging that the City of San Diego violated CEQA by approving and adopting a mitigated negative declaration for Cal Coast’s project. In response, the defendants filed an anti-SLAPP motion, which the trial court denied. The Fourth District Court of Appeal affirmed the motion’s denial with respect to the Ranch, but reversed the denial with respect to the attorney defendants.

Background

In the underlying action, Clews Land and Livestock, LLC v. City of San Diego (2017) 19 Cal.App.5th 161 (“Clews”), Cal Coast sought approval from the city to build and operate a school on its property, adjacent to Ranch property. Concluding that significant environmental impacts either were not present or would be mitigated, the city did not prepare an EIR. Instead, it adopted a MND and approved the project. The Ranch argued that the project would adversely affect the surrounding environment, that it would interfere with the Ranch’s operations, and that the city’s use of a MND was improper. The attorney defendants, on behalf of Ranch, appealed the approval of the project, but failed to timely appeal the city’s adoption of the MND. The city rejected the appeal.

The Ranch then sought a writ of mandate to compel the city to abandon the project and set aside the MND, arguing that the city’s procedure for preparing and adopting the MND violated CEQA. Additionally, it challenged the city’s appeal process for environmental findings. The trial court denied recovery on both procedural and substantive grounds, and the court of appeal affirmed.

Upon the conclusion of Clews, Cal Coast brought a malicious prosecution action against the Ranch and the Ranch’s attorneys, alleging that the CEQA action had been brought for an improper purpose. Cal Coast alleged that the Ranch simply sought to prevent or delay the project and preserve the Ranch owner’s privacy to enable criminal activity on the premises. (The Ranch owner pled guilty and was sentenced to prison in 2018 for child pornography charges.) Cal Coast also argued that the attorney defendants had maintained the case in an effort to force the Project’s abandonment, hoping to avoid a legal malpractice claim or a complaint to the State Bar for their failure to timely appeal the adoption of the MND. The defendants filed an anti-SLAPP motion to strike the malicious prosecution claim. The trial court denied the anti-SLAPP motion and the defendants appealed.

The Court of Appeal’s Opinion

To defeat the anti-SLAPP motion, Cal Coast simply needed to show minimal merit in its malicious prosecution claims that the CEQA action in Clews was brought without probable cause and with malice. This court held that Cal Coast met its burden with respect to the probable cause question. However, it concluded that Cal Coast could only point to evidence of malicious action by the Ranch, and not by the attorney defendants.

The court emphasized evidence in the administrative record showing that the Ranch’s concerns about the project were rooted in its potential impacts on the Ranch specifically, rather than on the environment. The Ranch’s concerns were therefore not within the scope of CEQA. The court additionally noted that the Ranch generally did not point to substantial evidence supporting a fair argument that the project could have a significant environmental impact. Under Preserve Poway v. City of Poway (2016) 245 Cal.App.4th 560, this showing is required to establish a MND’s insufficiency. The speculation, arguments, and opinions posited by the Ranch did not constitute substantial evidence. The court therefore concluded that Cal Coast established a probability for prevailing on the question of probable cause.

The court also noted the Ranch’s aggressive and consistent efforts to oppose any use of the proposed project site, including by prior owners of the property. It thus concluded that Cal Coast introduced sufficient evidence of the Ranch’s malice to survive the anti-SLAPP motion with respect to the Ranch. However, the court determined that there was not sufficient evidence to conclude that the attorney defendants acted maliciously, as there was no indication that the attorneys were actually aware of either the Ranch’s improper motives or the untenability of the Ranch’s claim. Cal Coast’s speculation that the attorney defendants were merely acting to avoid a malpractice claim or a State Bar complaint was insufficient to support a finding that the attorney defendants acted maliciously in maintaining the CEQA claims in Clews.

– Louisa I. Rogers

SB 7 – Jobs and Economic Improvement Through Environmental Leadership Act of 2021

On May 20, 2021, Governor Gavin Newsom signed Senate Bill (SB) 7, known as the Housing + Jobs Expansion & Extension Act. SB 7 extends the provisions of legislation enacted in 2011 (Assembly Bill 900) that created an expedited judicial review process under CEQA for large development projects that met certain criteria. AB 900 was repealed by its own terms on January 1, 2021.

SB 7 reenacts and updates AB 900 in order to “expedite the development and construction of urgently needed housing, clean energy, low carbon, and environmentally-beneficial projects, and the jobs they create.” The bill notes that numerous large projects under consideration in California have the potential to create thousands of high-skill, high-wage jobs. Many of these projects will replace old and outdated facilities with newer, cleaner, and innovative facilities that will lead the nation in environmental impact mitigation and reduction.

Thus the bill streamlines and facilitates development projects in a number of ways. First, the Governor may certify a project before the lead agency certifies a final EIR. Second, the environmental review, administrative process, and record of proceedings may be prepared concurrently. Third, the project applicant must agree to pay trial court costs if the lead agency’s certification is challenged. Fourth, to the extent feasible, judicial review of lead agency action must conclude within 270 days once commenced. Finally, the Bill extends the benefits of AB 900 to those projects that were certified by the Governor before AB 900’s expiration and by the lead agency within one year of AB 900’s expiration.

In order to be eligible for streamlined certification, a project must fall into at least one of the following categories. It must be on an infill site, certified as LEED Gold (or better), and able to achieve a 15% improvement in transportation efficiency. Or it must be a clean energy project that either generates power exclusively through wind or solar energy or manufactures equipment used in renewable energy production. Or it must be a housing project on an infill site that will dedicate at least 15% of the development to affordable and low-income housing. Although it may include mixed-use development—assuming at least two-thirds is residential—or transitional housing, no part of a certified housing project may be used for transient lodging, manufacturing, or industrial uses.

Regardless of the category it falls into, the project must meet certain criteria. First, it must result in at least $100 million in investment in California (except for housing projects, which must result in an investment of between $15 million and $100 million). It must also create high-wage and high-skill jobs that help reduce unemployment and encourage apprenticeship training. And, at a minimum, it must not lead to a net increase in greenhouse gas emissions, including from employee transportation. Finally, the project applicant must agree to monitoring and enforcement of its mitigation efforts by the lead agency.

SB 7 aims to boost California’s economic recovery by creating more and better housing and jobs, and doing so in an environmentally sustainable way. As Governor Newsom noted when he signed the legislation, “California’s recovery from the pandemic must tackle the housing shortage that threatens our economic growth and long-term prosperity. Cutting red tape to save time and remove barriers to production helps us meet the urgent need for more housing while creating good jobs and preserving important environmental review.” Indeed, AB 900 had already led to roughly twenty major clean energy and housing projects, 10,000 housing units, and thousands of high paying jobs. Proponents of SB 7 hope its passage will continue this trend.

The Governor’s press release is available here: https://www.gov.ca.gov/2021/05/20/in-san-jose-governor-newsom-signs-legislation-to-fast-track-key-housing-economic-development-projects-in-california/

– Blake C. Hyde