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.

BB Photos

U.S. Supreme Court Tells Cities to Explain a Cell Tower Denial in Timely Fashion, Even if in a Separate Document

The tension between demand for high-quality, ubiquitous cell phone service and opposition to cell towers in residential neighborhoods has resulted in significant disputes between wireless carriers and municipalities over siting of such towers. Typically, the fight begins and ends at a city council.  Recently, however, one such dispute resulted in a U.S. Supreme Court decision, T-Mobile South, LLC v. City of Roswell, Georgia,  No. 13-975, Jan. 14, 2015, which delved into procedural issues associated with denial of proposed cell towers and provided guidance to municipalities as to how and when such denials must be explained.Cell Phone Tower

T-Mobile proposed to construct a cell tower (disguised as a 108-foot tall pine tree, as required by local ordinance) on a vacant residential property.  As is often the case, there was substantial neighborhood opposition to the new tower based on concerns that it was not needed, that the technology was outdated,  and that it was aesthetically incompatible with the neighborhood.  The application was discussed at a public meeting and ultimately rejected by the City Council.  After the meeting, the City sent a notice of the denial to T-Mobile but without any written explanation.  Minutes of the Council meeting were published 26 days later, shortly before the deadline to file suit challenging the denial.

Approval or rejection of cell phone towers is addressed in the federal Telecommunications Act of 1996. In that Act, Congress delegated to the local governments the power to consider cell tower applications and required that a denial of an application “be in writing and supported by substantial evidence contained in a written record.” T-Mobile argued that the denial, while in writing, did not contain any explanation and, as such, could not be supported by substantial evidence. The City argued that T-Mobile representatives were present at the public meeting and thus knew the reasons. On top of that, they claimed, the release of the meeting minutes 26 days later (and four days before a petition for judicial review was due) satisfied the Act’s requirement of a written explanation. The Eleventh Circuit upheld Roswell’s denial, and the Supreme Court granted certiorari to resolve a conflict between the circuits. Continue Reading

California Supreme Court Poised To Decide Key CEQA Questions: The Court’s Lineup For 2015

California Supreme CourtThe California Supreme Court’s involvement in CEQA cases has been relatively limited since the statute’s enactment in 1970, with the court taking review of at most one or two appellate court decisions a year.  The last two years have, however, seen a dramatic shift in this trend, with the result that the court now has nine pending cases on its docket.  The pending cases span a broad range of issues, but they all involve fundamental questions:  the breadth of CEQA’s reach, the scope of agency discretion, the vitality of categorical exemptions, limits on mitigation obligations, and procedural limitations on CEQA litigation.

  • The court’s review in one case will include a key issue regarding CEQA’s scope — does required environmental review end with effects of the project on the environment, or must the environment’s impact on the project also be examined?  The court’s decision should squarely resolve this issue.
  • A pair of cases before the court involve categorical exemptions and the exception for significant impacts resulting from “unusual circumstances.”  Courts of appeal have issued conflicting decisions on this topic, and the high court’s decision on this question could have a major effect on the efficacy of these commonly used exemptions.
  • Limits on judicial review of an agency’s CEQA decisions is the subject of two cases before the court. In both cases, the courts of appeal took an expansive view of the powers of the court to reevaluate agency decisions. The high court may conclude that greater deference is owed lead agencies in light of their knowledge and expertise in the subject matter.
  • In two cases, the court will address potential limitations on the mitigation required for environmental impacts, including whether fiscal constraints can be used to limit mitigation measures and whether impacts on public services such as emergency and fire services must be mitigated.
  • The court will decide the important question of whether judicial review is limited to CEQA claims raised prior to the close of the period for public comment on a draft EIR, or whether issues raised for the first time during later hearings may also be considered.
  • Finally, the court will tackle another subject of conflicting appellate decisions — the effect of federal preemption on application of CEQA to publicly operated railroads. Resolution of the case will likely have significant implications for California’s High Speed Rail project.

Continue Reading

Federal Court Invalidates San Francisco Tenant Relocation Requirements

bosThe Northern District of California has struck down part of San Francisco’s rent control ordinance as an unconstitutional taking under the Fifth Amendment in Levin v. City and County of San Francisco, Dist. Court, ND California 2014, No. 3:14-cv-03352-CRB (N.D. Ca Oct 21, 2014). The case may have important implications for monetary exactions in local land use permitting.

At issue in Levin were the relocation payments required by the 2014 amendments to the San Francisco rent control ordinance. Under the ordinance, owners of rent-controlled property were required to make certain payments for tenants evicted under the Ellis Act. Under the 2014 amendments to the rent ordinance, in order to withdraw the unit under the Ellis Act, property owners were required to pay the greater of the lump sum required under the original ordinance or an amount equal to twenty-four times the difference between the unit’s current monthly rate and the fair market value of a comparable unit in San Francisco.

Plaintiffs, owners of rent-controlled properties in San Francisco, filed suit, bringing a facial challenge against the 2014 ordinance as violating the Takings Clause of the Fifth Amendment.

The court ruled in favor of the plaintiffs, finding that the 2014 ordinance constituted an exaction that violated the Takings Clause. The court first held that the San Francisco ordinance, which demanded monetary payment from the property owners in exchange for a permit to remove a unit from the rental market, had to satisfy the Nollan/Dolan requirements of essential nexus and rough proportionality. Next, the court found that the ordinance could not meet either of those requirements. Both steps in the court’s analysis may prove important in future cases involving monetary exactions.

Extending the reach of Nollan/Dolan

The Nollan/Dolan standard constitutes a special application of the unconstitutional conditions doctrine to the government’s land use permitting power. The Nollan and Dolan cases specifically applied to adjudicative land use exactions involving a government demand for property owners to dedicate an easement as a condition of obtaining a development permit. The central concern in these two cases was that the government may use its substantial power in land use permitting to pursue governmental ends that lack an essential nexus and rough proportionality to the effects of the proposed new use of the property.

The Supreme Court’s 2013 decision in Koontz v. St. Johns River Water Management District expanded the reach of Nollan and Dolan to monetary exactions. Because of the direct link between the government’s demand and a specific piece of real property, the Court held that the central concern in Nollan and Dolan was implicated and application of the standard to monetary exactions was appropriate. Continue Reading

Conservation Easements Not Required As Mitigation For Permanent Loss Of Farmland

In Friends of the Kings River v. County of Fresno, the California Fifth District Court of Appeal upheld the County of Fresno’s adoption of an Environmental Impact Report for a mining operation that will result in a permanent loss of 600 acres of farmland.  Most notably, the Court held that a County is not required to adopt an agricultural conservation easement as a mitigation measure for a project causing direct loss of farmland, even where agricultural conservation easements are economically feasible.

Fresno County FarmlandThe subject of the appeal was the Carmelita Mine and Reclamation Project, a proposed aggregate mine and related processing plant in the Sierra Nevada Foothills, about 15 miles east of the City of Fresno.  The 1,500-acre site has significant mineral deposits, and is currently used for growing row crops and stone fruit trees.

The petitioners, Friends of the Kings River, challenged the project’s Environmental Impact Report under the California Environmental Quality Act, and the project’s reclamation plan under the Surface Mining and Reclamation Act of 1975

Friends first appealed approval of the project with the State Mining and Geology Board, who granted the appeal and remanded the reclamation plan to the County for reconsideration. The County approved a revised reclamation plan, and Friends appealed to State Mining and Geology Board again.  The Board denied the second appeal.

While the first appeal was pending, Friends petitioned for a writ of mandate, alleging abuse of discretion under CEQA.  The trial court denied the petition, and Friends appealed.  On appeal, Friends argued that the trial court erred by ruling on the petition before it was ripe for review, and that the EIR was inadequate under CEQA for a plethora of reasons.

The Fifth District dismissed Friends’ ripeness claim by finding that the State Mining and Geology Board’s grant of Friends’ first appeal did not affect the validity of the reclamation plan. Thus, the remand of the reclamation plan to the County did not affect the trial court’s ability to issue a ruling on the merits, or the County’s certification of the EIR and approval of the project.

The Court then addressed Friends’ contention that the County failed to require mitigation for the conversion of farmland in violation of CEQA.  The Court rejected Friends’ argument, noting that the EIR recommended three mitigation measures, which the Count upheld.  The Court also rejected the contention that the County was required to establish agricultural conservation easements to mitigate the permanent loss of 600 acres of farmland.  The Court held that while a County must consider using agricultural conservation easements as a mitigation measure for direct loss of farmland, it is not required to adopt an agricultural conservation easement as a mitigation measure, even where such an easement is financially feasible.

Friends asserted a number of additional CEQA challenges, but those too failed, as the Court found that there was substantial evidence to support the County’s findings.

Fortunately for project proponents, this decision maintains the variety of mitigation alternatives available when a project causes loss of farmland.  Project proponents whose project directly leads to farmland loss will not necessarily be required to mitigate with an agricultural conservation easement, but will still need to analyze adoption of such an easement, in order to comply with CEQA.

Friends of Kings River v County of Fresno,  F068818 (5th District 12/8/2014)

Court Blocks Opponents’ Shot at Halting New Kings Arena

The court of appeal recently upheld legislation modifying several deadlines for CEQA review of a project that includes a proposed new arena for the Sacramento Kings, rejecting a claim the statute violates separation of powers.  Saltonstall v. City of Sacramento, No. C077031 (3d Dist., Nov. 20, 2014).

In 2013, the National Basketball Association approved the sale of the Kings to a local group planning to build a new downtown Sacramento entertainment and sports center, including an arena for the team.  Yet the NBA also reserved the right to acquire and relocate the franchise to another city if a new arena does not open in Sacramento by 2017.

In response, the Legislature amended CEQA, exclusively for the downtown arena project, to expedite the environmental review process.  The City of Sacramento complied with the accelerated deadlines, certified an environmental impact report, approved the arena project, and promptly was sued by project opponents.

images[8]The court of appeal rejected the opponents’ constitutional challenge to the CEQA legislation, holding that the amendment does not materially impair the core function of the courts, the legal standard for finding a separation of powers violation.

First, the statute does not infringe on the courts’ power to issue injunctive relief.  The court of appeal acknowledged that the legislation changes the standards for injunctive relief in connection with the arena project, but ruled that the Legislature has the prerogative to specify which interests should be weighed against the benefits of a new arena.  Indeed, the court reasoned, the Legislature has the constitutional right to exempt the arena project entirely from CEQA review, so it follows that the Legislature may determine which interests must be considered in deciding whether to halt its construction.

Second, the legislation does not unconstitutionally impose impossibly short deadlines on the courts.  One statutory provision requires the Judicial Council to adopt a rule to facilitate completion of judicial review of the project’s CEQA compliance within 270 days.  The court upheld the challenged provision, noting that it imposes no penalty for judicial review that exceeds the specified period and thus is “suggestive” only.

On more than one occasion in recent years, the Legislature has treated large-scale sports venues differently for CEQA purposes.  This decision reaffirms the Legislature’s authority to do so.

EIR For SANDAG’s Regional Transportation Plan Rejected By Court Of Appeal

In a long-awaited 2-1 decision, a court of appeal overturned the environmental impact report for the San Diego Association of Governments’ 2050 Regional Transportation Plan and Sustainable Communities Strategy. Cleveland National Forest Foundation v. San Diego Association of Governments (4th Dist., Div. 1, No. D063288, Nov. 24. 2014).   The most remarkable ruling, in what is likely to be viewed as a highly controversial decision, is the majority’s finding that the EIR was deficient because it did not assess the plan’s consistency with the 2050 greenhouse gas emissions reduction goal contained in an executive order issued by the Governor in 2005.

Background of the Plan and SB 375

The decision concerns SANDAG’s Regional Transportation Plan which contains the Sustainable Communities Strategy required by SB 375. When it enacted SB 375, the Legislature recognized that cars and light duty trucks emit 30% of the state’s greenhouse gases. Accordingly, SB 375 required the Air Resources Board to establish greenhouse gas emissions reduction targets applicable to cars and light duty trucks for each of the state’s metropolitan planning regions. The initial targets set goals for the years 2020 and 2035. SB 375 requires the Air Resources Board to consider new targets every eight years. The targets set for the San Diego area required a 7 percent CO2 reduction by 2020 and a 13 percent reduction by 2035.

In addition, the Legislature recognized that to achieve these targets, changes would need to be made to land use patterns and policies. For this reason, SB 375 also required Regional Transportation Plans to include land use-related strategies for achieving the targets, called Sustainable Communities Strategies. The SANDAG Regional Transportation Plan was the first in the state to be adopted with a Sustainable Communities Strategy.

The plan, however, drew fire. While it showed greenhouse gas emissions reductions through 2020, it also showed increases in greenhouse gas emissions after that date. Project opponents argued this was inconsistent with SB 375’s goals, the policy in AB 32 requiring that emissions reductions achieved by 2020 be maintained past that date, and an executive order targeting larger scale emissions reductions by 2050.

EIR’s Analysis of Greenhouse Gas Emissions

In 2005, Governor Schwarzenegger issued an executive order establishing statewide targets for greenhouse gas emissions reductions that included reducing emissions to 1990 levels by 2020 and to 80 percent below 1990 levels by 2050.  The EIR found that SANDAG’s plan would reduce greenhouse gas emissions until 2020, but would increase them in later years.  While it discussed the 2050 emissions reduction target in the executive order, it did not treat the order’s 2050 emissions reduction target as a standard for assessing the significance of the plan’s greenhouse gas impacts.

The court’s majority agreed with the plan opponents held that the EIR’s greenhouse gas impacts analysis was inadequate for failing to analyze the plan’s consistency with the executive order. While the executive order was not a legislative enactment, and established only statewide rather than regional emissions reduction targets, the majority reasoned that the executive order led to later legislation that  “validated and ratified the executive order’s overarching goal of ongoing emissions reductions,” and therefore the executive order continues to “underpin the state’s efforts to reduce greenhouse gas emissions throughout the life of the transportation plan.”  According to the majority, the absence of an analysis comparing the plan with the executive order’s 2050 emissions reduction target amounted to “a failure to analyze the Plan’s consistency with state climate policy.” Continue Reading

Coastal Commission Erred In Finding Property Owner Is Stuck With Unconstitutional Dedication Condition

In an opinion on rehearing, the Second District Court of Appeal overturned a California Coastal Commission decision that a condition of a county-issued coastal development permit could not be eliminated by a second coastal development permit the county issued for the same project. Bowman v California Coastal Commission, No. B243015, Oct. 23, 2014.  Focusing on the equities of the case, and the unfairness of the condition, the court refused to find that the county was barred from deleting the condition.

Background

The owner of a 400 acre parcel that included a lengthy stretch of shoreline in San Luis Obispo County applied to the county for a coastal development permit to rehabilitate an existing home on the property. Two years later, the county, acting as the local coastal permitting authority, issued the permit to the applicant’s successor, a family trust.   The permit was conditioned on the trust dedicating an easement for public access along the shorefront part of the property, even though the house was a mile from the shore. The trust didn’t appeal the dedication requirement to the coastal commission.

Nine months later, the trust applied for a second coastal development permit to replace a collapsed barn and to make the same improvements covered by the earlier permit.  The application also asked the county to remove the condition to the earlier permit requiring dedication of a coastal access easement. The county approved the application, including removal of the access easement condition, expressly acknowledging that the condition required an unconstitutional taking of property.  .

Concerned that the county had eliminated a valid existing coastal access easement, the Sierra Club, Surfrider Foundation, and two coastal commissioners appealed the county’s approval of the second coastal development permit to the coastal commission. The commission granted the appeal, determining that the easement was permanent and the applicant was bound by it because it didn’t contest the condition after it was imposed.

Decision

The court of appeal overturned the coastal commission’s determination.  The court rejected the opponents’ argument that the trust was stuck with the easement condition because it had not filed a legal challenge to it after the first permit was issued.  The opponents relied on the general rule that when an administrative tribunal renders a quasi-judicial decision and an administrative mandamus petition is not filed to contest it, collateral estoppel bars the agency from reconsidering the same issues. The court disagreed, concluding that it would be inequitable to apply collateral estoppel given the facts of the case.

Crucially, the trust did not start any of the improvements covered by the first coastal development permit and had limited its work to repairs authorized by “over-the-counter” permits exempt from coastal development permit requirements. Because the trust had not benefited from the first coastal development permit by performing work under it, it was not bound by its conditions.

The court also found the dedication condition clearly unconstitutional.  Stating its conclusion simply but directly, the court noted the Nolan/Dolan “rough proportionality” test for imposing conditions on a permit was not met because “there is no rational nexus, no less rough proportionality, between the work on a private residence a mile from the coast and a lateral public access easement.”

Conclusion

The court’s opinion is a narrow one, yet it demonstrates that courts will look to the equities of a case when considering application of the collateral estoppel doctrine in the context of a challenge to a permit condition, particularly when the condition is plainly improper.

Court Reaffirms City’s Discretion to Identify Local Historic Resources

In Citizens for Restoration of L Street v. City of Fresno, an appellate court affirmed that the substantial evidence test, not the fair argument test, governs an agency’s determination whether buildings or districts should be treated as historical resources under CEQA.

Background

This case concerned a proposed residential infill development project in the City of Fresno that would demolish the Crichton Home, which was designated as a heritage property by the city’s preservation commission in 2007. Under the city’s code, heritage properties are not designated as historical resources in the local register, but are nonetheless worthy of preservation. The Crichton Home, however, had fallen into disrepair and most of its historic integrity had been lost.

The city’s initial study found the project would not result in any significant environmental impacts and that the Crichton Home was not a historical resource. The preservation commission then  considered and approved a mitigated negative declaration and issuance of a demolition permit.

Plaintiffs appealed the preservation commission’s approvals, asserting that the commission did not have authority under the city code to make CEQA determinations. The city council denied the appeal, finding that the commission had the requisite authority to make a determination on the mitigated negative declaration and upheld the commission’s decision to approved it. Plaintiffs filed suit, alleging that the city had failed to comply with CEQA.

The trial court found that the commission was not authorized to approve the mitigated negative declaration. The court also found, however, that the city had correctly applied the substantial evidence standard in determining the project did not threaten “historical resources” protected by CEQA. The court subsequently issued a writ of mandate directing the city council to conduct a hearing on whether to approve the mitigated negative declaration. Both sides appealed.

The substantial evidence standard, not the fair argument standard, applies to a public agency’s determination of historicity.

Plaintiffs argued that the fair argument standard applies to the threshold question whether a building or site is a historical resource under CEQA. In plaintiffs’ view, whether a project site contains a building that is a historical resource should be reviewed under the same fair argument standard applied to whether a project site contains habitat of an endangered plant or animal.

The court rejected this argument, finding that the substantial evidence standard applied to the commission’s determination of historicity. Historical resources are treated differently than endangered plants and species because they are governed by different statutes. Relying on legislative history, the court concluded that CEQA’s provisions concerning historical resources were intended to allow a lead agency to make a discretionary decision about the historic significance of certain resources. The position that only a fair argument is needed to demonstrate historic significance is inconsistent with that discretion. The court found that the preservation commission’s determinations were supported by substantial evidence and consequently upheld the determinations.

CEQA permits delegating a lead agency’s authority to a commission, but such delegation must be clear.

CEQA allows public agencies to delegate the authority to make a final CEQA determination and approve a project to a subordinate body, provided that they also provide for an appeal to the agency’s elected decision-making body if it has one. Therefore, the court concluded, the city had the authority the delegate the authority to approve the mitigated negative declaration and the project to the preservation commission.

The court, however, also decided that the city had not delegated the authority to approve the mitigated negative declaration for the project to the commission. While the preservation commission had the authority to approve demolition permits of heritage properties, the court found it did not have decision-making authority over the project, nor was there any explicit delegation of authority to approve the mitigated negative declaration. The court was not persuaded that the preservation commission’s authority to provide review and comments on permit actions gave it authority to approve or disapprove the mitigated negative declaration.

The court also rejected the city’s alternative argument that the city council’s subsequent denial of the appeal constituted a de novo review of the mitigated negative declaration and that this cured any defect in the proceedings before the preservation commission. The court found that the city council had failed to act as the decision-making body in approving the demolition permits and failed to abide by the notice procedures and make the findings required by CEQA.

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