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California Land Use & Development Law Report

Legal Commentary on Planning and Development

California Adopts Emergency Water Curtailment Regulations

Posted in Environmental Regulation, Water Supply

It is now clear that the present drought requires that there be curtailment of the exercise of some existing water rights due to the lack of sufficient surface water.  On January 17, 2014—the same day as the Governor’s Proclamation of a drought state of emergency—the State Water Resources Control Board issued a “Notice of Surface Water Shortage and Potential of Curtailment of Water Right Diversions.”  The notice advised that if dry weather conditions persisted, the Board will notify water right holders of the requirement to limit or stop diversions of water under their water rights, based on water right priority.

On March 1, 2014, Governor Brown signed legislation to assist drought-affected communities and provide funding for better managed local water supplies.  As part of that drought relief package, the Legislature expanded the Board’s existing emergency regulation authority under Water Code section 1058.5 and made statutory changes streamlining the authority to enforce water rights and increasing penalties for illegally diverting water during drought conditions.  See SB 104 (adopted March 1, 2104).

Water Code section 1058.5, as amended, grants to the Board the authority to adopt emergency regulations in certain drought years in order to “prevent the waste, unreasonable use, unreasonable method of use, or unreasonable method of diversion, of water to promote water recycling or water conservation, to require curtailment of diversions when water is not available under the diverter’s priority of right, or in furtherance of any of the foregoing, to require reporting of diversion or use or the preparation of monitoring reports.”

Any emergency regulation adopted pursuant to this section may remain in effect for up to 270 days and is deemed repealed immediately upon a finding by the Board that due to changed conditions, it is no longer necessary.

On April 25, 2014, Governor Brown issued a Proclamation of Continued State of Emergency related to the drought.  The Proclamation affirms provisions of the January 17, 2014 Proclamation and added new provisions related to water conservation, water transfers, fishery protection, water recycling, groundwater overdraft protection, water supply shortage and fire response.  Additionally, the Proclamation suspended CEQA requirements for certain activities, including the adoption of emergency regulations under Water Code section 1058.5.

Under the state water right priority system, the Board must curtail water diversions when sufficient flows in a watershed are not available because the water is needed to satisfy senior rights or provide a correlative share of equally senior rights (i.e., riparian rights), or is needed to meet public trust and water quality requirements.

On May 20, 2014, the Board adopted emergency regulations.  See Cal. Code Regs., tit. 23, §§ 877-879.2 (found at article 24, title 23, division 3, chapter 2 of the California Code of Regulations, §§ 877-879.2).  Under these regulations, the Board—based upon an extensive factual record—curtailed diversions of water on a priority basis in three watersheds on the ground that public trust needs required minimum flows for federally-listed anadromous fish.  The authority to issue the curtailment order was given to the Deputy Director and provision was made for exclusion from the curtailment for diversions necessary for minimum health and safety needs.  All water users issued a curtailment order were required to respond and provide the requested information.    The regulations also provided for an alternative to curtailment, which permitted diverters to propose and enter into agreements that would accomplish the same purpose.

Under these regulations, violations can be subject to an administrative civil liability under the Water Code or referred to the Attorney General.  Administrative cease and desist orders and court injunctions are also available.  An administrative civil liability for an unauthorized diversion could be up to $1000 per day, plus $25,000 per acre-foot of water illegally diverted.

The process followed in issuing the curtailment orders with respect to the three watersheds involved in the May 2014 curtailment was time consuming, cumbersome and ineffective.  As a result, it was determined that additional emergency regulations were necessary to improve the Board’s ability to quickly and effectively implement and enforce curtailments during the current drought and to ensure that the State’s water right priority system is effectively implemented.  The Board found that while it has existing authority to issue curtailment notices to junior water users and to initiate enforcement actions, it is likely that there will be a high degree of non-compliance during the drought that will impact senior water rights holders.  Thus, it proposed new regulations that it concluded would solve curtailment and reporting compliance problems.  The Board concluded that  (1) the proposed regulations will provide greater assurance that curtailed water rights holders will cease diverting water; and (2) provide greater assurance that curtailed water rights holders will report information regarding continued exercise of their senior water rights.  As opposed to the process required under the Board’s existing authorities, as exemplified by the May 20, 2014 regulations—which required a case-by-case investigation, issuance of a draft cease and desist order or proposed administrative civil liability, and the opportunity for an evidentiary hearing—a violation of the new proposed emergency regulation would be immediately effective and enforceable by administrative penalty.

The emergency regulations, were adopted on July 2, 2014 and are found in Title 23 of the California Code of Regulations, Article 24, division 3, chapter 2, sections 875, 878.1, 878.3 and 879.  They are effective statewide and are subject to the same 270-day sunset provision as the May 20, 2014 regulations.

Section 875 authorizes the Deputy Director for the Division of Water Rights to issue curtailment orders to post-1914 appropriative right holders in order of water right priority, requiring the curtailment of water diversions and use (except as provided in sections 878 and 878.1).  Section 878.1 provides for certain minimal diversions for domestic and municipal uses.  Section 878.3 provides for regional alternatives to curtailment through agreement (with approval of the Deputy).

As originally proposed, the regulations adopted on July 2, 2014, applied to all diverters, including pre-1914 and riparians.  That version of the regulations also contained a provision excusing minimal health and safety needs from the curtailment.  However, the final version—following numerous comments—excluded pre-1914 appropriators and riparians from the curtailment provisions and also eliminated the health and safety need exclusion on the ground that it could be accomplished by other provisions.

The essence of the emergency regulations adopted July 2, 2014, is contained in section 875.  It provides that:

  • The Deputy Director may issue curtailment orders to post-1914 appropriative water rights holders in order of water right priority requiring curtailment of water diversions; no hearing is required;
  • The Deputy Director can rely upon the information listed in the regulations in making the determination of whether water is available under a diverter’s priority and to issue or suspend curtailment orders;
  • Any order is to be accompanied by the Deputy Director’s determination of the quantity of water and other facts concerning the availability of water and the assumptions employed in issuing the curtailment;
  • A notice of the curtailment specifying the method of curtailment must be given;
  • The provision that all curtailment orders are subject to reconsideration under Water Code sections 1122, et seq.;  however, other than through the reconsideration process, no hearing is provided for prior to curtailment.

Section 879 provides for reporting by diverters subject to curtailment and certification that diversion has ceased.

The new regulation, as presently worded, does not prioritize for the Deputy Director any types of use that are to be given preference over others.  Presumably, the decision is within the discretion of the Deputy Director who, under existing law, must consider public trust uses.  Although pre-1914 and riparian users are not currently subject to the new curtailment procedure, there is nothing suggesting that they could not be subjected to such a procedure under regulations that could be adopted later.

The new regulations are, in large part, a response to the ineffectiveness of prior efforts at curtailment.  For example, with the onset of the drought, thousands of notices of curtailment were sent to various junior water rights diverters with a minimal response in terms of cessation of diversion, reporting and other requirements.  There was also a lack of enforcement ability short of going to court.  It is hoped that has been remedied by the new regulations.

On July 15, 2014, the Board took further action in light of the drought emergency.  It adopted additional emergency regulations prohibiting:

  • The application of water to outdoor landscapes in a manner that causes runoff such that water flows onto adjacent property, non-irrigated areas, private and public walkways, roadways, parking lots or structures;
  • The use of a hose to wash an automobile, except where the hose is fitted with a shutoff nozzle;
  • The application of water to any hard surface; and
  • The use of potable water in a fountain or other decorative water feature.

The taking of any such prohibited actions could subject the violator to a fine of up to $500/day.

An additional regulation was adopted applicable to water suppliers requiring them to implement requirements that impose mandatory restrictions on outdoor irrigation and implement other mandatory conservation measures.  Urban water suppliers are required to submit monitoring reports to the Board.

State Water Resources Control Board May Weigh the Use of Water for Public Purposes Against Commercial Use by Riparian Users and Early Appropriators in Determining Reasonableness of Commercial Use

Posted in Endangered Species, Environmental Regulation, Water Supply

A court of appeals, for the first time, has upheld the  State Water Resources Control Board’s authority to restrict valid pre-1914 and riparian water rights on the ground that their exercise has become an unreasonable use of water under current circumstances.

While it has long been accepted that California law requires that water be put to a use that is both beneficial and reasonable, what constitutes an “unreasonable use of water” has received little attention.  This opinion, in finding the use in question to be unreasonable, is significant both for the principles it relies on and its articulation of the sideboards of the “reasonable use” requirement. Light v. State Water Resources Control Board, 173 Cal.Rptr.3d 200 (2014)

In April 2008, a particularly cold month during a dry year, young salmon were found stranded along the banks of the Russian River.  Federal scientists concluded that the deaths were caused by the abrupt declines in water level due to diversions of water that was sprayed on vineyards and orchards to prevent frost damage.  The salmon are classified as threatened or endangered under the Federal Endangered Species Act.

Following a series of hearings and the preparation of an environmental impact report, the State Water Resources Control Board adopted a regulation — Regulation 862 — that will likely require the reduction in diversion of water for frost protection under certain circumstances.  Regulation 862 delegated the task of formulating regulations governing water use programs to local bodies comprised of diverting growers.  The regulation declares that any water use inconsistent with the programs promulgated (and later approved by the Board) is unreasonable and prohibited.

The plaintiff growers successfully challenged the regulation in the trial court, contending that because the Board lacks regulatory authority to limit diversions by riparian users and pre-1914 appropriators it has no authority to regulate their use of water.

The court of appeal reversed, holding that although the Board has no authority to require such users to obtain a permit to divert water, it has the power to prevent riparian users and pre-1914 appropriators (and anyone else) from using water in an unreasonable manner.  “We conclude that, in regulating the unreasonable use of water, the Board can weigh the use of water for certain public purposes, notably the protection of wildlife, against commercial use of water by riparian users and early appropriators.”

Under California’s dual system of water rights and rule of priority, ownership of the water is vested in the People, but the right to divert water from its natural course for public or private use can be acquired.  Riparian users have water rights through their ownership of riparian land.  Riparian users have never been required to obtain a permit, because their water right emanates from the riparian character of their land.   Appropriators are those who hold a right to divert for use on non-riparian lands.  Appropriators who established their rights prior to California’s adoption of a regulatory system for appropriation in 1914 are not required to obtain a permit or license.

California’s rules of priority require that riparian users must curtail their use proportionately amongst themselves in times of shortage and that appropriative rights are determined by first-in-time, first-in-right.  California Constitutional Amendment Article X, section 2 (adopted in 1928) provides that water use “shall be reasonably required for the beneficial use to be served.”  The provision applies to both riparian users and appropriators.

The appellate court in Light emphasized that “reasonableness” is now the overriding principle governing the use of water in California.  It acknowledged, however, that the California courts have never defined what constitutes an unreasonable use of water.  The court concluded that what is a reasonable and beneficial use at one time may not be at another and that a determination of reasonableness depends upon the circumstances.  In other words, what may be a reasonable use at one time may – because of changed conditions – be waste at a later time and be unreasonable:

“Although, as we have said, what is a reasonable use of water depends on the circumstances of each case, such inquiry cannot be resolved in vacuo isolated from statewide considerations of transcendent importance.  Paramount among these we see the ever increasing need for conservation of water in this state, and inescapable reality of life quite apart from its express recognition in Article X, section 2.”

The court also pointed out that the public trust is a second potential limit on private uses of water.  The public trust, which has been extended in geographic terms from navigable waters to include non-navigable tributaries, has amongst its purposes the preservation of water’s function as a natural habitat.  Consequently, the Board, in issuing licenses that will permit an appropriator to take water has an affirmative duty to take the public trust into account and to protect public trust uses where feasible.  The Board has been given statutory powers to make reasonable rules and regulations to control and condition water use and to prevent unreasonable or wasteful use of water.

In Light, the plaintiffs challenged Regulation 862 contending that:

  • The Board lacks authority to enact regulations on unreasonable use of water
  • The Board lacks authority to limit water use by riparian and pre-1914 appropriators
  • The regulation improperly violates the rules of priority

The trial court ruled favorably for the plaintiffs on all counts.  But the appellate court reversed.

The court of appeal found that Regulation 862 – which provides in part that “a diversion of water that is harmful to salmonids is an unreasonable use of water if the diversion can’t be managed to avoid harm” – was valid and within the Board’s authority.  It also held that the regulation applied to riparian users as well as pre-1914 appropriators.  The court concluded that while the Board cannot require pre-1914 appropriators and riparians to obtain a permit, that does not mean that the Board cannot prevent such users from diverting water for a use the Board determines to be unreasonable.  In that regard, the Board has authority to determine what has become an unreasonable use and prohibit such use.  The court held that the “vested rights” doctrine does not prevent the Board from redefining existing beneficial uses as unreasonable.

Consequently, the extent of a particular users’ vested right to use water may change.  “A riparian users’ vested water rights extend only to reasonable beneficial water use, which is determined at the time of use.”  The court held that the Board has ultimate authority to allocate water in a manner inconsistent with a rule of priority when to do so is necessary to prevent the unreasonable use of water.  According to the court, that power is buttressed by the State’s obligation under the public trust doctrine that applies to all water rights.

The court stressed that the legislature has declared that the use of water for recreation and the preservation and enhancement of fish and wildlife resources is a beneficial use of water.  It has thus recognized that the welfare of wildlife is a beneficial use on a par with the type of commercial uses that have traditionally been recognized as beneficial.  Consequently, balancing the use of water for frost protection against the use for salmon habitat is the application of a fundamental policy decision within the power of the Board.

The court ultimately concluded that in regulating the unreasonable use of water, the Board can weigh the use of water for certain public purposes (notably the protection of wildlife habitat) against commercial use of water by riparian users and early appropriators and prohibit the use of water for frost control under the circumstances that were before it..

The court does not suggest that at the time the riparian and pre-1914 users began diverting water for frost protection that use was neither beneficial nor reasonable.  In fact, it is clear that it was.  As a result, the court’s decision is, in effect, a determination of unreasonableness, based upon current circumstances.

The opinion does not include any discussion of whether the relative priority of existing uses should be considered when terminating diversions determined to  be unreasonable.  For example, should post-1914 diversions for frost protection be terminated prior to limiting riparian and pre-1914 diversions?  This is the process the State Board has followed in its recent adoption of emergency regulations limiting water diversions in certain watersheds due to lack of adequate water.  It is also reflected in the emergency regulations adopted on July 2, 2014, which establish a streamlined process for the Board to use in curtailing diversions by post-1914 water rights holders.  The July 2 regulations do not extend that curtailment process to riparian and pre-1914 diverters.

The opinion endorses the proposition that the Board has broad authority to determine reasonableness at any time and, based upon changed circumstances, may declare well established uses unreasonable and, therefore, waste and impermissible.  It also suggests that the Board’s determination of priority between two otherwise reasonable uses can result in the termination of one without the implication of a taking.

The Plaintiffs in Light filed a petition for rehearing.  The court, on July 11, 2014, denied the petition, but amended its opinion in response to the argument made by Light that Regulation 862 had the effect of immediately banning frost protection during the relevant period of time.  The court’s amended opinion adds a footnote that acknowledges that Light’s reading of Regulation 862 may be correct, if read literally.  However, it then opines that if the regulation is construed with its accompanying resolution, the regulation can be interpreted to mean that the curtailment of diversions for frost protection would only take place after the local body charged with developing regulations mandated by the Board had completed its task—which the court determined would take more than two years.

Renewal of Interim Contracts For Delivery of Central Valley Project Water to Districts an Ongoing Project Exempt from CEQA

Posted in Land Use, Water Supply

In February 2012, the Westlands Water District and related water distribution districts entered into two-year interim renewal contracts with the U.S. Bureau of Reclamation relating to the Bureau’s ongoing provision of Central Valley Project water to the Districts.  The purpose of the interim contracts was to continue the existing terms for water delivery in advance of the Districts’ anticipated execution of new, long-term renewal contracts, which were awaiting the Bureau of Reclamation’s completion of environmental documentation necessary for execution of the long-term agreements.

The Districts approved the interim renewal contracts finding the renewals exempt from CEQA.  The trial court agreed, ruling that the matters contemplated in the interim contracts were exempt under the statutory exemption for ongoing pre-CEQA projects and CEQA’s categorical exemption for the continued operation of existing facilities.  The court of appeals affirmed.  North Coast Rivers Alliance v. Westlands Water District, Fifth District, July 3, 2014 (F067383).

Westlands Water District serves over 600,000 acres of farmland with Central Valley Project water.  The CVP is a federal reclamation project built within the major watersheds of the Sacramento and San Joaquin river systems and the Delta.  It was originally financed, constructed and operated under the terms of the Reclamation Act of 1902 and, later, under the Rivers and Harbors Act of 1937 and the Central Valley Project Improvement Act of 1992.   Operated by the Bureau of Reclamation under water rights granted by the State Water Resources Control Board, the CVP is the nation’s largest water reclamation project and California’s largest water supplier.  The CVP allocates CVP water to water districts that contract with it subject to a comprehensive scheme of environmental statutes and regulations, including the Improvement Act of 1992, the federal Endangered Species Act, and various state and federal regulations governing Delta water flow and water quality.

The original contract between the Bureau of Reclamation and Westlands was entered into in 1963 and was to remain in effect for 40 years.  The Improvement Act of 1992 provides that the Bureau “shall” upon request, renew existing long-term water service contracts for a period of up to 25 years—but only after the Bureau first prepares a programmatic EIS that examines the effects of implementing the Act on the environment.  Delays in the completion of the environmental documentation led the Bureau to enter into a series of interim two-year contracts with the Districts.  In December 2011, the Districts approved the two-year interim renewal contracts at issue in this appeal.

In approving the interim contracts, the Districts found that the renewals were exempt from the requirements of CEQA for several reasons.  The Districts found that the renewal contracts merely involved the ongoing receipt and delivery of water on same terms as the prior water service contracts—with no expansion of service and no construction of new facilities.  They also  found that, to the extent the contracts involved any changes, the changes related only to rates, dates and other minor administrative matters.  The Districts made specific findings that the renewals were exempt from CEQA under the statutory exemptions for ongoing pre-CEQA projects and for rate-setting and the categorical exemption for ongoing operation of existing facilities in CEQA Guidelines § 15301.

Following approval of the interim renewal contracts, Petitioners filed suit alleging that no exemptions to CEQA were applicable and that the Districts were required to undertake CEQA review.  Petitioners claimed that the water rights at issue would involve the diversion of a substantial volume of water from the Delta, thereby affecting water flows, water purity, and harming endangered fish species.  They also alleged that the delivery of irrigation water to the lands served by the Districts would contribute to a further buildup of contamination of the soils and groundwater with salt, selenium and other pollutants.

The trial court rejected Petitioners’ challenge, concluding the interim renewal contracts were exempt from CEQA.  As to the rate-setting exemption, the court found the interim renewal contracts had the effect of setting rates between the Bureau and the Districts and, in all other respects, merely continued the existing water deliveries without change.  The court also found the water deliveries were an ongoing project subject to the statutory exemption applicable to projects authorized before the adoption of CEQA.  Finally, the court ruled that the existing facilities exemption applied, since the interim renewal contracts merely authorized continued water deliveries under the existing system and use of the existing distribution network.

The trial court also rejected Petitioners’ claim that exceptions to the categorical exemption (relating to significant effects on environment caused by unusual circumstances or cumulative impacts) were applicable, concluding that the baseline for the interim renewal contracts was the environment that existed in December 2011—including all environmental damages that already existed at the time.  Because the contracts did not increase or change the existing water deliveries, construct new facilities, or make other changes to existing environment, the exceptions to the exemption were not established.

The appellate court affirmed, engaging in an extended discussion of the standard of review, the applicable statutory and categorical exemptions, as well as exceptions to the exemptions and the standard to be applied with respect to the application of both.  The court emphasized the difference between statutory and categorical exemptions, pointing out that statutory exemptions are absolute if the project fits within its terms.  A categorical exemption, by contrast, is subject to exceptions that can defeat its use, including the exception that applies where there is a reasonable possibility the activity will have a significant effect on the environment due to unusual circumstances and the exception that applies where the cumulative impact of successive projects of the same type is significant.

The appellate court found that the statutory rate-setting exemption in Public Resources Code section 21080(d) did not apply, agreeing with the petitioners’ argument that the interim renewal contracts did not identify any action that was being taken by the water districts that amounted to rate setting actions: they did not mention rates or say anything about adjusting, approving or establishing rates.

The court concluded, however, that the statutory exemption for ongoing projects approved prior to the date CEQA took effect applied.  The court held that the applicability of the ongoing project exemption depends upon whether the challenged action is a normal, intrinsic part of the ongoing operation of a project approved prior to CEQA or is instead an expansion or modification of a pre–CEQA project.  It concluded the exemption applied because the evidence in the record was sufficient to support a finding that the amount of water Westlands Water District is entitled to receive through its existing facilities each year can be traced back to the contractual commitments that were made prior to the CEQA’s effective date, November 23, 1970.

The court of appeal also held that the categorical exemption for continued use of existing facilities applied and that there was no basis for finding any exception to the exemption.  The court first found the exception based on a reasonable probability of significant effects due to unusual circumstances did not apply.  The petitioners argued significant effects would result because  the diversion of more than 1 million acre-feet of water from the Delta each year could adversely affect threatened fish populations and fragile habitat in the Delta and that use of the water for irrigation could add to the salt and selenium buildup in the soil and groundwater in the Westlands Water District area.  The court rejected this claim, determining that application of the correct environmental baseline to assess the project’s impacts made it clear that petitioners had failed to show a reasonable possibility of a significant effect on the environment: The large volume of water distributed to the water districts and used for irrigation was clearly part of the existing environmental baseline for the district’s ongoing operations and a potential for adverse change in the environment from these existing conditions was not shown; further, even if were assumed some change from the existing environmental baseline might occur, the  record evidence was  insufficient to show that the brief period involved in the interim renewal contracts – only two years – would potentially have a significant environmental effect.

The court also rejected the argument that the interim renewal contracts triggered the exception for “successive projects of the same type” which may result in significant cumulative impacts.  Petitioners claimed the successive contract renewals create significant cumulative environmental damage over time, including salt and selenium buildup in the soil and groundwater, as well as harm to salmon, smelt and other endangered fish populations and their habitat in the Delta.  The court concluded, however, that under the “unique statutory context” of the case, the short-term, interim renewal contracts did not amount to “successive projects of the same type” under the exception contained in the Guidelines.

Categorical Exemptions Under CEQA — California Supreme Court Grants Review of Another Case Involving the Unusual Circumstances Exception

Posted in CEQA

In a recent case decided by the Third District Court of Appeal the court upheld the use of a CEQA exemption for a proposed rodeo at a county fairground despite claims it would pollute  a nearby creek.   Citizens for Environmental Responsibility v. State of California ex rel. – 14th Dist. Agricultural Association (No. C070836).    

The California Supreme Court granted a petition to review the court of appeal decision in Citizens for Environmental Responsibility on July 9, 2014,  pending the supreme court’s consideration and disposition of  Berkeley Hillside Preservation v. City of Berkeley, a case pending before the court which involves questions relating to interpretation and application of the unusual circumstances exception to the categorical exemptions from CEQA.

In Citizens for Environmental Responsibility the 14th Agricultural District found a proposed two-day rodeo at the Santa Cruz County fairground exempt from CEQA under the Class 23 Categorical Exemption—an exemption that applies to “normal operations of existing facilities for public gatherings for which the facilities were designed, where there is a past history of the facility being used for the same or similar kind of purpose.”

Fairground’s history of similar activities.  In granting the exemption, the District noted the long history of similar activities at the fairground.  The facility included equestrian/livestock arenas and barns, most of which were constructed in 1941. The existing equestrian facilities had been in existence for at least 50 years, and on average, the fairground sponsored two to four equestrian livestock shows per month for the past 25 to 30 years. In the late 1970s, the fairground hosted at least eight annual rodeos. The District also noted that the rodeo would utilize existing facilities and no construction or physical alternations of the grounds were proposed. Manure would be dealt with as described in the previously adopted manure management plan.

The unusual circumstances exception.   The categorical exemptions from CEQA are subject to an exception that makes the exemption inapplicable when significant impacts will occur due to unusual circumstances.  The court concluded the plaintiff failed to establish unusual circumstances which would trigger the exception.   The court reasoned that the unusual circumstances inquiry is exemption-and facility-specific: When determining whether the circumstances of the project differ from the circumstances covered by the Class 23 categorical exemption for the normal operations of a public gathering facility, it is appropriate to look at other activities at the facility that make up its normal operations and compare those circumstances against those presented by the proposed project.

Criteria for identifying unusual circumstances.  The court also identified criteria that would show an activity presents unusual circumstances under the Class 23 exemption:

  • the project proposes a significant change in operation to distinguish the project from normal operations
  • unusual environmental risks are presented by the proposed project
  • the project is inconsistent with the surrounding zoning and land uses
  • the scope and size of the project are dissimilar from other projects at the facility.

The court found that under these criteria, there was nothing to suggest anything unusual compared to past activities at the fairground.

California Supreme Court grants review.  On July 9, 2014 the California Supreme Court granted a petition for review of the Court of Appeal’s decision.   The supreme court ordered that further action on the matter is deferred pending its decision in  Berkeley Hillside Preservation v. City of Berkeley, a case pending before the court which raises several issues relating to interpretation and application of the unusual circumstances exception to the categorical exemptions.  See our June, 2012 post for a discussion of the issues before the court in Berkeley Hillside.

Lack of Prejudice Barred Relief Despite Defective Hearing Notice

Posted in CEQA, Land Use, Planning and Zoning

An opponent of a Wal-Mart project was thwarted in his attempts to use an admittedly defective hearing notice as a basis for overturning project approvals.  The court ruled that his claims were defeated by his failure to present evidence of prejudice and by a prior appellate decision.  Roberson v. City of Rialto, No. E058187 (4th Dist. 5/21/14 [ordered published 6/17/14]). Continue Reading

Santa Cruz Becomes First County to Ban Fracking

Posted in Environmental Regulation, Land Use, Planning and Zoning

Santa Cruz County has become the first California county to permanently ban the controversial oil and gas drilling technique known as fracking. By a 5-0 vote, the Board of Supervisors this week amended its General Plan to prohibit all facilities for oil and gas exploration and development within the unincorporated County.

The ban replaces a temporary moratorium on fracking instituted last year that was set to expire this September. The new prohibition may have no practical effect, as the County has no active oil and gas production.

Santa Cruz County joins Beverly Hills, which earlier this month became the first California city to ban fracking.

Conditions of Approval: “No Do-Overs” On A Condition The Landowner Failed To Challenge When First Imposed.

Posted in Exactions and Assessments, Land Use

A landowner’s attack on a condition of approval of a development permit was barred by the landowner’s failure to contest the same condition when it was imposed on an earlier permit, according to a recent court of appeal decision.  Bowman v California Coastal Commission, B243015 (2d Dist 2014). 

San Luis Obispo County issued a coastal development permit to rehabilitate a house on a 400-acre beachfront property.  The county conditioned the permit upon dedication of an easement for public access along the property’s shorefront. The landowner did not appeal to the Coastal Commission or otherwise contest the condition.

Nine months later, the landowner applied for a second coastal development permit, again to rehabilitate the house and also to replace a barn on the property.  This second application requested removal of the easement condition.  The county approved this second permit, and removed the condition, but environmental groups appealed to the Coastal Commission.  The Coastal Commission determined that the easement condition was permanent and binding, and that removal of the condition would violate the Coastal Act policy favoring public access to coastal resources.  It conditioned the second permit on implementation of the easement condition of the first permit.  The landowner sued, seeking to overturn the condition.

The court sided with the Coastal Commission.  It concluded the county made a quasi-judicial determination that the easement condition was valid when it issued the first permit, which became final when the landowner failed to appeal the condition imposed on that permit.  That administrative decision is protected by the doctrine of collateral estoppel, the court ruled, which precludes litigation of claims that were contested in a prior proceeding or that could have been contested.  Accordingly, the landowner could not launch what amounted to a collateral attack on the first permit condition simply by challenging the second permit.

The court clarified that the status and nature of the coastal development permit were not relevant, since collateral estoppel applied to the final decision to impose the condition rather than to the permit itself.  As a result, it was irrelevant that the landowner might have been entitled to “walk away” from the first permit and that the first permit might have expired. Likewise, it did not matter that the Coastal Commission might have modified the permit condition.  The landowner pointed to “nothing that would compel the Commission to modify that access easement condition, a condition the validity of which is not subject to attack.”  The court also found that whether the landowner accepted the first permit was also beside the point.

The court also found that the record contained sufficient evidence to support the Coastal Commission’s implied finding that the landowner accepted the permit by completing work on the house restoration; the contention the landowner could accept this benefit while rejecting the burdens of the permit was, according to the court,  “untenable.”  In addition, it found the fact that the landowner completed the work on the  house before the first permit was issued  even more unavailing.  concluding the landowner should not be allowed to obtain an advantage by proceeding with work without a permit.

Note:  The court has ordered rehearing on an important question relating to  how the evidence in the record of the agency’s proceedings should be treated by a reviewing court.  The court has asked the parties to address specific questions in supplemental briefing  including how the  rule which provides that a court  ”must consider all relevant evidence,  including evidence detracting from the decision” when determining whether an agency’s decision is supported by substantial evidence should be applied and whether it is appropriate for a reviewing court to engage in a “limited weighing of the evidence”  under the substantial evidence standard of review.   The court’s decision on these and related questions when it rehears the case could affect its rulings on whether the evidence in the record supported the Coastal Commissions determinations.

While rehearing is pending,  the opinion is not citable as precedent.  Nevertheless, the court’s rulings on the legal effect of the original conditions of approval  illustrates how important it can be to act quickly in contesting unacceptable conditions to a development approval.

National Climate Assessment Report Released

Posted in Climate Change

On May 6, 2014, the Government released its U.S. National Climate Assessment Report, “Climate Change Impacts in the United States.”  The evaluation of climate change impacts in the United States is 841 pages long, but is accompanied by a 148-page “Highlights” and an 11-page “Overview” that summarizes the findings.  The assessment is the product of some 300 experts and a 60-member National Climate Assessment and Development Advisory Committee.  It draws upon numerous workshops, extensive peer-reviewed research, and technical reports.  In addition to the general conclusions, specific assessments relating to impacts upon different regions of the country and different elements of the economic and structural fiber of the country are contained.  The full report, highlights and overview can be downloaded from the National Climate Assessment website http://nca2014.globalchange.gov/downloads.

The overview lists twelve primary findings.  Each finding is backed up by substantial scientific justification and an explanation of the anticipated future impacts.  The findings are set forth in greater detail in the full report and highlights.

  1. Global climate is changing and this is apparent across the United States in a wide range of observations.  The global warming of the past 50 years is primarily due to human activities, predominantly the burning of fossil fuels.  The most recent decade is the warmest on record.  However, because human-induced warming is superimposed on natural, varying climate, rising temperatures are not evenly distributed.  The amount of warming projected beyond the next few decades is directly linked to the cumulative global emissions of heat-trapping gases and particles.  By the end of this century, a roughly 3° to 5° Fahrenheit rise is projected under the lower emissions scenario, which would require substantial reductions in emissions.  A rise of 5° to 10° Fahrenehit is anticipated for a higher emissions scenario, assuming continued increases in emissions (predominantly from fossil fuel combustion).
  2. Some extreme weather and climate events have increased in recent decades, and new and stronger evidence confirms that some of these increases are related to human activities.  Over the past 50 years, much of the United States has seen an increase in prolonged periods of excessively high temperatures, more heavy downpours, and, in some regions, severe drought.
  3. Human-induced climate change is projected to continue, and it will accelerate significantly if global emissions of heat-trapping gases continue to increase.  Heat-trapping gases already in the atmosphere have committed us to a hotter future with more climate-related impacts over the next few decades.  The magnitude of climate change beyond the next few decades depends primarily on the amount of heat-trapping gases that human activities emit globally, both now and in the future.
  4. Impacts related to climate change are already evident in many sectors and are expected to become increasingly disruptive across the nation throughout this century and beyond.  There is mounting evidence that harm to the nation will increase substantially in the future unless global emissions of heat-trapping gases are greatly reduced.
  5. Climate change threatens human health and well-being in many ways, including through more extreme weather events and wildfire, decreased air quality, and diseases transmitted by insects, food, and water.  Large-scale changes in the environment due to climate change and extreme weather events are increasing the risk of the reemergence of health threats that are currently uncommon in the United States.
  6. Infrastructure is being damaged by sea level rise, heavy downpours, and extreme heat; damages are projected to increase with continued climate change.  In combination with the pattern of continued development in coastal areas, increasing damage to U.S. infrastructure, including roads, buildings, and industrial facilities – along with increasing risks to ports and coastal military installations will occur.  Flooding along rivers, lakes and cities following heavy downpours and a rapidly melting snowpack will exceed the limits of flood protection designed for historic conditions.
  7. Water quality and water supply reliability are jeopardized by climate change in a variety of ways that affect ecosystems and livelihoods.  Surface and groundwater supplies are stressed by an increasing demand for water, as well as declining runoff and groundwater recharge.  Climate change is increasing the likelihood of water shortages, particularly in the southern part of the United States.
  8. Climate disruptions to agriculture have been increasing and are projected to become more severe over this century.  While some U.S. regions and some types of agricultural production will be relatively resilient to climate change over the next 25 years, others will increasingly suffer from stresses due to extreme heat, drought, disease, and heavy downpours.  From mid-century on, climate change is projected to have more negative impacts on crops and livestock.
  9. Climate change poses particular threats to Indigenous Peoples’ health, wellbeing, and ways of life.
  10. Ecosystems and the benefits they provide to society are being affected by climate change.  The capacity of ecosystems to buffer the impacts of extreme events like fires, floods, and severe storms is being overwhelmed.  Climate change impacts on biodiversity are already being observed in alteration of the timing of critical biological events, such as the spring floodburst and substantial range shifts of many species.  In the longer term, there is an increased risk of species extinction.
  11. Ocean waters are becoming warmer and more acidic, broadly affecting ocean circulation, chemistry, ecosystems, and marine life.  More acidic waters inhibit the formation of shells, skeletons, and coral reefs.  Warmer waters alter distribution, abundance, and productivity of many marine species.
  12. Planning for adaptation (to address and prepare for impacts) and mitigation (to reduce future climate change, for example by cutting emissions) is becoming more widespread, but current implementation efforts are insufficient to avoid increasingly negative social, environmental, and economic consequences.

Department of Water Resources Must File Condemnation Case Before Undertaking Geological and Environmental Testing on Private Property

Posted in Public Agencies

In Property Reserve, Inc. v. Super. Ct. of San Joaquin County, the Third District Court of Appeal ruled that if the State intends to acquire an interest in private property directly, “no matter how small an interest, the California Constitution requires it to initiate a condemnation suit that provides the affected landowner with all of his constitutional protections against eminent domain in that action.”  In this case of first impression, the court ruled that the “entry statutes” — the  California Eminent Domain Law’s precondemnation entry provisions — failed to pass constitutional muster where a state agency proposed to undertake extensive geological and environmental studies on private property without first filing an eminent domain complaint.

The State Department of Water Resources sought to study the geological and environmental suitability of hundreds of properties upon which it proposed to build a freshwater transport canal or tunnels to divert water from Northern California to Southern California to implement its Bay Delta Conservation Plan.  The court of appeal held the State’s request to enter onto private property to perform geological and environmental testing — prior to filing a complaint under the Eminent Domain Law — would effect a taking.

In compliance with the statutory procedure for precondemnation entry for testing purposes, the State filed a “master petition” seeking a court order granting it rights of entry from more than 150 owners of more than 240 land parcels totaling tens of thousands of acres.  For all of the properties, the State proposed conducting environmental studies including mapping the properties and surveying botany, hydrology, plant and animal species, cultural resources, utilities, and recreational uses.  The geological studies proposed for a portion of the parcels involved tests penetrating soil with rods one and one-half-inches in diameter in depths up to 200 feet, along with soil borings to depths of 205 feet which would leave bore holes six inches in diameter.   At the conclusion of testing, the holes would be filled with “permanent columns of cement.”

The superior court ruled the geological activities would constitute a taking only authorized in a direct condemnation action, not a precondemnation action.  However, the superior court granted, subject to certain limitations, the State’s request to enter private property to conduct environmental studies for up to 66 days during a yearlong term, with up to eight personnel during each entry.  The State deposited $1,000 to $6,000 as “probable compensation” for “actual damages or substantial interference” with each property owners’ use of their properties.  But on appeal, the court of appeal found both types of precondemnation testing activities would effect takings of compensable property interests.

First, the court of appeal found the proposed geological testing would result in a “permanent physical occupation” constituting a taking per se, regardless of the “public interests” served.

Second, while acknowledging there is “no bright-line rule” for determining whether a temporary physical invasion constitutes a taking, the court found the proposed environmental study activities would work a taking because they “intentionally acquire a temporary property interest of sufficient character and duration to require being compensated.”  After weighing factors including whether the invasions were intended, the character of the invasions, the duration of the invasions, and the invasions’ economic impact, the court determined the State had sought a “blanket temporary easement” that had to be acquired in a condemnation suit rather than through the precondemnation entry statutes.

Resolving a question of first impression, the court held the State’s precondemnation entry statutes do not provide an “eminent domain proceeding” sufficient to comply with the constitutional limits on the State’s exercise of the power to condemn property.  If a public agency “intentionally seeks to take property or perform activities that will result in a taking,” the California Constitution requires that it “directly condemn” the affected property interest in an authorized condemnation suit in which the landowner receives “all of his constitutional protections against eminent domain.”  The State’s “acquisition of a property interest, permanent or temporary, large or small” requires direct condemnation of the property interest and payment of the property owner in a condemnation suit that gives the landowner “all of his constitutional protections against the state’s authority.”

The court concluded that the State’s precondemnation entry statutes violate the California constitution because they do not provide the fully panoply of protections provided to a landowner in a condemnation suit.

The majority opinion was followed by a lengthy dissent in which one justice argued that the entry rights sought for geological testing did not effect takings and the entry statutes were constitutional, both facially and as applied.  Invalidating the  statutes would “force a public entity that initiates a large-scale public project. . . either to put up the money for the entire property before determining its suitability” or “engage in two complete condemnation proceedings with their attendant costs.”

Not surprisingly, given the importance of the issues involved, on April 22 the  State Department of Water Resources filed a petition seeking review by the California Supreme Court.

Property Reserve, Inc. v. Superior Court of San Joaquin County,  No. C067758  (3rd Dist. March 13, 2013)

Greenhouse Gas and Climate Change Impacts: CEQA Practice Tips

Posted in CEQA, Climate Change

The analysis of climate change impacts under CEQA has rapidly evolved over the last several years. For this reason and others, nearly every challenge to an environmental impact report today features an attack on the EIR’s analysis of greenhouse gas emissions.

Fortunately, amendments to the CEQA Guidelines and recent court decisions have provided environmental professionals and practitioners some useful guidance. This post discusses the relevant Guidelines sections and offers three practice tips based on case law addressing climate change impacts.

CEQA Guidelines on Greenhouse Gas Emissions

Amendments to the CEQA Guidelines adopted in 2010 outline how to analyze a project’s contribution to greenhouse gas emission levels, though the amendments do not establish any specific significance thresholds for greenhouse gas impacts. That is, they don’t answer the key question: How much emission of greenhouse gases should be considered significant?

The Guidelines do, however, provide some help:

  • A lead agency should make a good-faith effort, based to the extent possible on scientific and factual data, to describe, calculate, or estimate the amount of greenhouse gas emissions resulting from a project.
  • A lead agency has the discretion to decide for each project whether to use a model or methodology to quantify greenhouse gas emissions resulting from a project, and/or rely on a qualitative analysis or performance based standards.
  • In assessing the significance of impacts from greenhouse gas emissions on the environment, the lead agency should consider (1) the extent to which the project may affect emissions levels, (2) whether project emissions exceed the applicable threshold of significance, and (3) the extent to which the project complies with regulations or requirements adopted to implement statewide, regional, or local plans to reduce greenhouse gas emissions.
  • Lead agencies must consider “feasible means” of mitigating the significant effects of greenhouse gas emissions. The Guidelines list a number of types of measures a lead agency “may include” in a mitigation program.

Guidelines §§ 15064.4, 15126.4(c).

Significance Thresholds

Various types of significance thresholds for measuring climate change impacts are acceptable under CEQA. Local climate action plans can form the basis for significance thresholds, or public agencies instead can rely on thresholds of significance developed by a regional air quality management district. Another option is for an EIR to assess whether a project will significantly hinder or delay California’s ability to meet greenhouse gas reduction targets established by AB 32, the Global Warming Solutions Act of 2006. Under AB 32, the state committed to reducing its greenhouse gas emissions to their 1990 level by 2020. This leads to the first “practice tip.”

Practice Tip #1:

If Using AB 32 Reduction Targets as a Significance Threshold, Calculate Baseline Emissions and Compare Project Emissions.

To make sense of this advice, consider a decision issued last year, Friends of Oroville v. City of Oroville, 219 Cal. App. 4th 832 (2013). The project was replacement of an existing Wal-Mart store with a Wal-Mart “supercenter” of nearly twice the size. The EIR correctly analyzed the project’s greenhouse gas emissions consistent with the instructions in the Guidelines.

There were no local plans or regional air district significance thresholds available, so the city assessed greenhouse gas emissions based on whether the project would significantly hinder or delay California’s ability to meet reduction targets established by AB 32. Applying this significance threshold, the EIR calculated that emissions from the new store would amount to about .003 percent of California’s 2004 greenhouse gas emissions. The EIR concluded, in light of how small that figure was, that the project’s contribution to the state’s greenhouse gas emissions was less than significant.

The court had no problem with the significance threshold (reduction targets under AB 32), but concluded the EIR had misapplied it.

The court contrasted the EIR’s approach with that taken in Citizens for Responsible Equitable Environmental Development v. City of Chula Vista, 197 Cal. App. 4th 327 (2011), which featured the replacement of a Target store with a larger Target store. That EIR calculated and compared (1) existing store emissions, (2) proposed store emissions under “business as usual” projections, and (3) proposed store emissions with energy saving measures incorporated.

In contrast, the Friends of Oroville EIR suffered from two serious flaws. First, the court found the comparison of the project’s greenhouse gas emissions to the entire state’s emissions “meaningless.” The relevant comparison instead was whether emissions were significant relative to the AB 32 standard of reducing emissions (by about 30 percent) from 2020 business as usual levels. Second, the EIR needed to calculate greenhouse gas emissions from the existing store and then estimate the quantitative or qualitative effect of the project’s mitigation measures on the emissions added by the new store.

In sum, where there was no local climate action plan and the regional air quality management district had not adopted any greenhouse gas thresholds of significance, the court looked approvingly to a threshold of significance based on a comparison with “business as usual” projections. In similar circumstances, public agencies would be well advised to follow a comparable methodology.

Practice Tip #2:

Mitigation for Greenhouse Gas Emissions Cannot Simply Require that a Future Plan Include Undefined and Untested Mitigation Measures.

In Communities for a Better Environment v. City of Richmond, 184 Cal. App. 4th 70 (2010), an EIR for replacements and upgrades to a major refinery determined the project’s greenhouse gas emissions likely would have a significant effect on the environment and would require mitigation. The EIR required submission of a future mitigation plan designed to achieve no net increase in greenhouse gas emissions. In preparing its mitigation plan, the project applicant would be required to inventory emissions and look for ways to implement reductions. It then would need to “consider implementation of measures that achieve [greenhouse gas] reductions including, but not limited to,” several candidate mitigation measures identified in the EIR.

The court rejected this approach, saying the mitigation program merely proposed a “generalized goal” of no net increase in greenhouse gas emissions. The EIR set out possible mitigation measures that were “nonexclusive, undefined, untested and of unknown efficacy.” That was not enough for the court: Under these conditions, a public agency cannot wait until after the CEQA process is complete to prepare a plan for future mitigation.

Importantly, there was no evidence before the city indicating the proposed mitigation measures would achieve no net increase in greenhouse gas emissions, or even that a mitigation program could be devised that would meet such a standard. Keeping this in mind, EIRs that rely on a future plan for greenhouse gas mitigation should be accompanied by concrete evidence showing the mitigation program can accomplish the stated goal.

Practice Tip #3:

Adoption of New Significance Thresholds for Greenhouse Gas Emissions Generally Does Not Require Preparation of a Supplemental EIR.

For the first time in a published opinion, a court last year considered whether, subsequent to certification of an EIR, a regional air quality management district’s adoption of new significance thresholds for greenhouse gas emissions constituted “new information” that triggered the need for a supplemental EIR. Concerned Dublin Citizens v. City of Dublin, 214 Cal. App. 4th 1301 (2013). The court ruled it did not.

In Concerned Dublin Citizens, the City of Dublin certified a program EIR for a transit center specific plan in 2002. The EIR did not address climate change, though it did consider air quality impacts from other pollutants. Almost a decade later, the City relied on the program EIR to approve development of a specific site within the transit center.

Petitioners claimed supplemental environmental review was required because the Bay Area Air Quality Management District had adopted thresholds of significance for greenhouse gas emissions in 2010. CEQA requires preparation of a supplemental EIR if “new information, which was not known and could not have been known at the time the EIR was certified as complete, becomes available.” Pub. Res. Code § 21166. The court ruled that information about climate change has been broadly known for some time and therefore that information could have been addressed in the 2002 EIR.

The court’s decision makes clear that the adoption of new significance thresholds for greenhouse gas emissions generally does not constitute “new information” requiring preparation of a supplemental EIR.

Conclusion

Although analyzing climate change impacts under CEQA will remain challenging, the recent decisions discussed here provide greater clarity to public agencies, environmental professionals, and practitioners interested in ensuring an EIR’s analysis is done right.

This post is adapted from a presentation the author made on March 25, 2014, at the annual meeting of the California Association of Environmental Professionals.