Failure to Challenge Affordable Housing Condition Barred Subsequent Claim of Invalidity of Enabling Ordinance under Costa-Hawkins Act

While acknowledging that the City’s affordable housing ordinance was no longer enforceable under the Costa-Hawkins Act, an appellate court dismissed a challenge to a permit condition requiring compliance with the ordinance because the owner failed to seek timely review of the permit condition through administrative mandamus. City of Berkeley v. 1080 Delaware, LLC, 234 Cal.App.4th 1144 (2015).

1080 Delaware

In 2004, the City issued a conditional use permit for construction of 51 residential rental units. One of the permit conditions required that 20% of the units be rented at rates affordable to below-median-income households pursuant to the City’s affordable housing ordinance. Market conditions delayed construction of the building for several years, after which the owner declared bankruptcy and the property was acquired by 1080 Delaware through foreclosure. In the interim, the court in Palmer/Sixth Street Properties, L.P. v. City of Los Angeles, 175 Cal. App. 4th 1396 (2009), invalidated an affordable housing ordinance similar to the City’s under the Costa-Hawkins Act, which generally precludes cities from restricting the initial rents that may be charged by landlords.

After 1080 Delaware notified the City that it viewed the affordable housing requirements as unenforceable in light of Palmer/Sixth Street, the City filed suit seeking a declaratory judgment that the permit condition remained valid and enforceable. In response, 1080 Delaware argued that the invalidity of the ordinance on which the permit condition was based necessarily rendered the condition itself invalid. Continue Reading

California Department of Fish and Wildlife’s EIR for Fish-Stocking and Hatchery Program Upheld

A court of appeal has held that the first-ever environmental impact report for the state’s fish hatchery and stocking programs complies with CEQA, but also found that three of the EIR’s mitigation measures constituted “underground regulations” in violation of the Administrative Procedure Act. Center for Biological Diversity v. California Department of Fish and Wildlife, Third Appellate District Case No. C072486.lossy-page1-800px-STOCKING_FISH_AND_FISHING_IN_MERCED_RIVER_-_NARA_-_542561.tif

The Fish-Stocking Programs. Since the late 19th century, the Department of Fish and Wildlife has been required by statute to conduct a massive fish hatchery and stocking program. But hatchery trout introduced into mountain lakes contribute to declining amphibian populations, and hatchery salmon and steelhead are causing hybridization, which reduces the genetic diversity and strength of the fish species. As the result of a CEQA lawsuit, the Department was required to prepare its first EIR on the state-mandated program; the Department also decided to include in the EIR several other programs, including one that authorizes fish stocking in lakes and ponds by private aquaculture facilities.

The Program EIR. The Department prepared a program EIR that analyzed the program’s species impacts on a statewide, rather than a site-by-site, basis. The EIR included protocols and plans for discovering and mitigating site-specific impacts at the nearly 1,000 water bodies the Department stocks and the 24 hatcheries it oversees. The EIR’s baseline for environmental review, and its no-project alternative, was ongoing operation of the program as it had functioned from 2004-2008.

As for the private fish stocking programs, the EIR identified, and the Department adopted, new prerequisites and monitoring and reporting obligations for private vendors. Continue Reading

Second District Court of Appeal Invalidates Approval of Elder Care Facility, Citing Lack of Evidence to Support Zoning Determination

A developer relying on financial hardship to obtain approval of an elder care facility exceeding the square footage permitted in a residential zone must present evidence of such financial hardship to sustain the required finding. Simply averring that a smaller project would not achieve economies of scale needed to provide adequate support services is inadequate. Walnut Acres v. City of Los Angeles, No. B254636 (2nd Dist., April 15, 2015).

In 2006, the City of Los Angeles adopted Municipal Code section 14.3.1 in order to consolidate the land use approvals required for eldercare facilities, including housing for Alzheimer’s/dementia care, assisted living, and skilled nursing. Section 14.3.1 applies as a permitting overlay to a site’s underlying zoning. One required finding is that “strict application of the land use regulations on the subject property would result in practical difficulties or unnecessary hardships…,” the same finding required in many jurisdictions (including Los Angeles) to obtain a zoning variance.900px-Seal_of_Los_Angeles,_California.svg

The developer in Walnut Acres sought to construct a 50,289 square-foot, 60-guest room elder care facility in a residential district, with 25 percent of the beds allocated to persons with Alzheimer’s or dementia. Application of the relevant zoning provisions to the site would have limited the facility to 12,600 square feet and 16 guest rooms.

The zoning administrator approved the project over objections from neighbors. To substantiate Section 14.3.1’s “undue hardship” requirement, the zoning administrator found that strict application of the code’s requirements would, among other things “result in significant underutilization of the site and would not permit the operator to achieve the economy of scale required to provide the level of on-site support services and amenities required for the elder care facility’s unique population.” The zoning administrator’s decision was affirmed by the City Council’s Planning and Land Use Management Committee. Continue Reading

Court of Appeal Sinks Challenge to TMDL for Lake Bed Sediment

A Court of Appeal has upheld the Regional Board’s adoption of the total maximum daily load (TMDL) for concentration of pollutants in the sediment in McGrath Lake, rejecting the claim that TMDLs may not be stated in terms of concentrations of pollutants in lake bed sediments. Conway v. State Water Resources Control Board, No. B252688 (2nd Dist., March 30, 2015).

The Clean Water Act requires states to identify polluted water bodies within their jurisdictions, and to set TMDLs for those water bodies. The TMDL is the maximum amount of pollutants that can be discharged into an impaired water body from point and nonpoint sources. California implements the TMDLs in California through the Porter-Cologne Water Quality Control Act.

McGrath Lake PhotoMcGrath Lake is a small, black dune lake located at the southern end of McGrath State Beach Park in Ventura County. It is located within the McGrath Lake subwatershed, which consists primarily of agricultural fields, petroleum facilities, park lands, public roads, and a closed landfill. McGrath Lake was placed on the Clean Water Act Section 303(d) list on of impaired waters in 1998, 2002, and 2006 due to levels of organochlorine pesticides and PCBs.

In 2009, the Los Angeles Regional Water Quality Control Board set TMDLs for the lake through an amendment to the Los Angeles Basin Plan. The Board concluded that exposure of the McGrath Lake ecosystem to the organochlorine pesticides and PCBs in amounts exceeding the objectives and criteria had impaired beneficial uses, including aquatic life and recreational uses. The Basin Plan Amendment set TMDLs for contaminants from two primary sources: (1) agricultural runoff from surrounding fields that entered the lake largely through a Central Ditch; and (2) from lake bed sediment which could enter the lake by, among other ways, through desorption.

The TMDL for sediment was stated in terms of concentrations of pollutants in the sediment, not the concentration of pollutants in the lake’s water column. While setting a goal of 14 years to achieve the TMDL for the lake bed sediment, the Basin Plan Amendment acknowledged that such a goal would not be achieved by natural attenuation, and that capping or dredging would be the possible methods of remediation. Continue Reading

Appellate Court Reaffirms Broad Discretion of Trial Courts to Determine Appropriate Attorneys’ Fees

The Fourth Appellate District upheld the trial court’s award of less than 10% of the fees requested by the prevailing petitioner in a CEQA case, finding no abuse of the broad discretion accorded trial courts in awarding fees. Save Our Uniquely Rural Community v. County of San Bernardino, No. E059524 (4th Dist., March 18, 2015)

Dark backgndAl-Nur Islamic Center proposed to build an Islamic community center and mosque in a residential neighborhood in an unincorporated area of San Bernardino County. The County of San Bernardino adopted a mitigated negative declaration and issued a conditional use permit for the project. Save Our Uniquely Rural Community Environment (SOURCE) filed a petition for writ of mandate challenging the approvals. The trial court granted the petition on just one of many grounds asserted, finding a CEQA violation for failure to study environmental impacts in the area of wastewater disposal. SOURCE moved for $231,098 in attorney fees.

The trial court granted the motion, but reduced the award to $19,176, noting that SOURCE had succeeded on only one of its six CEQA arguments and on none of its four conditional use permit arguments.

The court of appeal affirmed, holding that SOURCE failed to demonstrate any abuse of discretion. The extent of a party’s success, the court stated, was a key factor in determining the amount of attorneys’ fees to be awarded. Here, SOURCE had advanced multiple land-use and CEQA claims and sought an order setting aside the approvals pending preparation of an EIR. However, it succeeded solely on one of its CEQA claims and obtained only an order setting aside the approvals pending further review on the single issue of wastewater treatment. The trial court thus acted well within its discretion in reducing the requested fee award based on degree of success.

The trial court likewise did not abuse its discretion in finding several elements of the fees excessive, including 40 hours preparing a 14-page reply brief that consisted primarily of reiterating the arguments made in the opening brief; charging nearly $10,000 for a “run-of-the-mill” attorney fees motion; and billing 8.3 hours at partner rates for basic research on matters such as standards of review, “CEQA law and guidelines” and “requirements for opening brief.”

Additionally, the court remarked that while SOURCE claimed its counsel’s rate were reasonable for the Los Angeles area, it failed to show why those rates were reasonable in San Bernardino County. Absent a specific showing of why adequate lawyers in the local market could not be obtained, the trial court was justified in calculating attorneys’ fees based on reasonable local market rates.

The court also found no justification for petitioner’s request for a multiplier of two based on the purported risk assumed by the law firm, the complexity of the questions involved, or the superior skills allegedly displayed by its attorneys in presenting them.

California Supreme Court Grants Review of Decision Invalidating SANDAG Regional Transportation Plan

The California Supreme Court has agreed to review the appellate court decision Cleveland National Forest Foundation v. San Diego Association of Governments. As we previously reported, the court of appeal in that case invalidated the EIR for the San Diego Association of Government’s 2050 Regional Transportation Plan and Sustainable Communities Strategy.

In its petition for review to the California Supreme Court, SANDAG raised a number of issues. However, the high court’s order granting review limits the scope of review to the most important and controversial issue in the case: whether the EIR for a regional transportation plan must include an analysis of the plan’s consistency with the greenhouse gas emission reduction goals reflected in Executive Order No. S-3-05. The vote to review the case was unanimous.

Council Member Barred From Considering Own Appeal

In Woody’s Group, Inc. v. City of Newport Beach, the Fourth District Court of Appeal held that the City Council of Newport Beach “violated two basic principles of fairness: you can’t be a judge in your own case, and you can’t change the rules in the middle of the game.” Thus, a council member who appealed a planning commission decision to the city council could not participate in the appeal; nor could the city council consider the appeal at all when the council member had failed to pay the filing fee or otherwise follow the procedures in the municipal code. Woody’s Group v. City of Newport Beach, No. G050155 (4th Dist., Jan. 29, 2015).

Woody's WharfWoody’s Wharf is a long-established restaurant and bar overlooking Newport Harbor. In September 2013, the Newport Beach Planning Commission approved a conditional use permit and variance to allow Woody’s to install a patio cover, continue to operate until 2 a.m. on weekends, and allow dancing inside the restaurant. Four days after the approval, Newport Beach City Council member Mike Henn sent the city clerk an email with an “official request to appeal” because he “strongly believed” the approval was inconsistent with policies in the City’s General Plan. The city council subsequently voted 4 to 1 to reverse the planning commission decision, with Henn in the majority.

Under the City’s municipal code, an appellant from a planning commission determination must be an “interested party,” post a fee, and use the proper form. The code contained no provision for appeals by city council members.

The court of appeal found that the appeal did not comport with due process because the council member who brought the appeal also took part in the decision. The court held that an interested party for the purposes of bringing the appeal cannot simultaneously be a disinterested person for the purposes of affording due process in hearing the appeal, where the council is acting in an adjudicatory capacity. The court invoked the “cardinal rule” that “a person cannot be a judge in his or her own case,” and stated, “we will not assume the drafters of Newport Beach’s Municipal Code intended to contravene a cardinal rule of justice in the absence of a clear statement of such remarkable intent.”

The court also found that the city council violated its own municipal code by entertaining Henn’s appeal because he did not comply with the procedures laid out in the code. The City argued that there was a longstanding practice of allowing council members to appeal without paying a filing fee because their appeals are taken for the benefit of the City’s residents. The court rejected this argument, finding “no room for unwritten rules, policies or customs outside the municipal code or for the city council to give its members special privileges to appeal.” The court also rejected the trial court’s rationale that the improper appeal was harmless because interested parties (such as local residents) would surely have filed appeals anyway.

The court concluded that a city council’s consideration of an appeal not authorized under the municipal code required nullification of the council’s decision rather than remand for reconsideration. The court ordered reinstatement of the planning commission’s decision, thereby returning dancing and late nights to Woody’s Wharf.

California Supreme Court Upholds Most Commonly Used CEQA Categorical Exemptions

The California Supreme Court has issued its long-awaited decision in Berkeley Hillside Preservation v. City of Berkeley, No. S201116 (March 2, 2015). The Court’s decision clears up some of the ambiguity that has surrounded the standard of review for challenges to CEQA exemptions under the unusual circumstances exception. In doing so, the Court rejected the controversial approach taken by the court of appeal and instead opted for a middle ground, balancing the interest in giving effect to the legislatively-mandated exemptions against CEQA’s overarching goal of ensuring review of significant environmental effects.Proposed House

Background

The project at issue was a large house to be built in the City of Berkeley. The city granted a use permit and found the project exempt from CEQA under the Class 3 (construction and location of limited numbers of new, small facilities or structures) and Class 32 (in-fill development) exemptions. The city also determined that none of the exceptions to categorical exemptions listed in CEQA Guidelines section 15300.2 were triggered, including the exception for a “significant effect on the environment due to unusual circumstances.” An organization sued, alleging, among other things, that the exemptions were barred by the unusual circumstances exception.

The court of appeal overturned the City’s exemption determination, holding that the possibility that a proposed activity might have a significant effect on the environment “is itself an unusual circumstance,” barring reliance on a categorical exemption.

A Potentially Significant Environmental Effect Alone Is Not Sufficient to Trigger the Unusual Circumstances Exception.

The California Supreme Court reversed and remanded, holding that a party bringing a challenge under the unusual circumstances exception must establish both 1) that there are unusual circumstances that justify removing the project from the exempt class; and 2) that there is a reasonable possibility of significant environmental impacts due to those unusual circumstances.

The Court began by examining the text of section 15300.2, which provides: “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.” According to the Court, the plain language of this provision supported the view that there must be some showing of unusual circumstances for this exception to apply. The court of appeal’s interpretation would, the Court found, render the phrase “due to unusual circumstances” mere surplusage.

The Court further found that under the court of appeal’s interpretation, the categorical exemptions would have little, if any, effect. The Court noted that under CEQA section 21080(c) and (d) and Guidelines section 15061(b)(3), when there is no substantial evidence that an activity will have a significant effect on the environment, “further CEQA review is unnecessary; no CEQA exemption is necessary to establish that proposition.” Thus, under the court of appeal’s interpretation, the categorical exemptions would serve no purpose, applying only when the proposed project is already outside the scope of CEQA review. Continue Reading

CEQA Year in Review 2014

Insurance-Recovery-Resources-imageA Summary of Published Appellate Opinions Under CEQA

 By Stephen Kostka, Julie Jones, Barbara Schussman, Alan Murphy,  Ned Washburn, Laura Zagar, Kathryn Bilder, Christopher Chou and Marie Cooper

In 2014, courts, regulators and public agencies continued to struggle with the relationship between CEQA and California’s efforts to reduce greenhouse gas emissions.  Courts of appeal held that San Diego County’s regional transportation plan, sustainable communities strategy and climate action plan all violated CEQA, concluding that public decisionmakers had not done enough to analyze and mitigate GHG impacts from vehicles.  Another court held that EIRs must provide detailed discussion of a proposed project’s energy use.  And under the mandate of Senate Bill 743, the Office of Planning and Research proposed sweeping CEQA Guidelines changes that would shift the focus of CEQA transportation analysis from traffic congestion to reduction of vehicle GHG emissions.

The year also saw a surprising conflict in decisions regarding the analysis of impacts to agricultural resources, with one court reaffirming a lead agency’s ability to identify its own significance thresholds and another court taking a much more hands-on approach.  Turning to mitigation for impacts to agricultural land, a third court confirmed earlier cases holding that CEQA does not require agricultural conservation easements as mitigation.

Court decisions tackling the nuts-and-bolts operation of CEQA were equally interesting.

During the year four appellate courts discussed the functions and uses of program EIRs versus project EIRs; these cases may help lay to rest persistent misconceptions about program EIRs.  One court addressed the circumstances under which a city commission can approve a CEQA document.  Another delved, with uncertain results, into the distinction between a proposed project element and a mitigation measure.

The California Supreme Court issued only one CEQA decision in 2014.  The court held that CEQA compliance is not required where a city council is presented with an initiative measure and a short Elections Code deadline to either adopt or reject it.

Finally, the Legislature’s key contribution in 2014 was Assembly Bill 52, which adds tribal cultural resources to the categories of cultural resources in CEQA, provides for tribal consultation, and requires lead agencies to consider mitigation measures for impacts to tribal cultural resources.

CEQA Year in Review can be accessed here, or is available in pdf form here.

 

25th Annual Briefing on Land Use and Development Law — Materials Available

Perkins Coie attorneys — most of whom contribute regularly to this report — recently presented the 25th Annual Land Use & Development Law Breakfast Briefing in Palo Alto, San Francisco and Walnut Creek.   The presentation focused on 2014 developments and trends in land use, affordable housing, school facilities financing, CEQA, real estate and environmental and resources Law.  This year, for the first time, the breakfast briefing will also be presented in San Diego, on February 12, 2015.BreakfastBrief

For an electronic version of the 25th Annual Land Use & Development Law Breakfast Briefing materials, click here.  If you would like a hard copy, please contact MichelleRodriguez@perkinscoie.com.

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