Social and Psychological Impacts of Changes in Community Character are Outside the Scope of CEQA

Poway, California, touts itself as the “City in the Country.” For 20 years, Harry Rogers operated a horse boarding facility in Poway known as the Stock Farm.  Rogers decided to close down the Stock Farm and build twelve homes in its place, most of which would be on one-acre lots, with enough room for  horses, a permissible use under existing zoning. Over objections from some members of the community, the city council unanimously approved the proposed development based on a mitigated negative declaration. Preserve Poway v. City of Poway (D066635)  4th Dist., March 9, 2016.

Palo Alto Stock Farm horse barn, Fremont Rd., Palo Alto, CA

Opponents of the development filed suit to challenge the city council’s actions, claiming that an EIR was required because the loss of the Stock Farm would have a significant impact on Poway’s horse-friendly “community character:” Children would not be able to continue riding horses and will spend their free time “sitting in front of a computer or video game, or getting into trouble;” riding horses at the Stock Farm taught children valuable life lessons, and brought families together; and Poway would lose its “City in the Country” feel. The trial court agreed with these arguments, and ruled against the city.

The city appealed, and the court of appeal upheld the city’s actions, holding that the impact of closing the Stock Farm on the character of the community is outside of CEQA’s scope.

The court observed that to the extent community character has been discussed in CEQA cases, it has been limited to aesthetic impacts.  However, the court explained, “The community character issue here is not a matter of what is pleasing to the eye; it is a matter of what is pleasing to the psyche.”   The opponents’ claims went beyond aesthetic concerns to include “psychological and social factors giving residents a sense of place and identity, what makes them feel good and at home in Poway.”

The court explained that CEQA does not require an analysis of subjective psychological feelings or social impacts, and that the fact that there was a heated public debate about community character does not by itself put the project within CEQA’s reach. As the court stated, “CEQA’s overriding and primary goal is to protect the physical environment;” the “environment” for purposes of CEQA is the physical conditions  within the area that will be affected by a proposed project.

The CEQA Guidelines and case law make it clear that a project’s social and psychological effects are not to be treated as effects on the environment.  Cases decided under NEPA,  the court noted,  have also rejected claims that a project’s social and psychological effects should be treated as environmental impacts.  Thus, the opponents’ repeated assertions that the Stock Farm was integral to Poway’s community character as the “City in the Country” did not sway the court, because it saw the project’s claimed impacts on community character as psychological and social effects.

The court concluded that CEQA did not require the city to study psychological and social impacts upon its community character; if the Legislature had wanted to define the “environment”  to include psychological, social or economic impacts on community character, it could have done so, but it did not.


State Allocation Board Approves Level 3 Fees — CBIA Seeks Injunction

In a move that could result in doubling developer fees overnight in more than 200 school districts, the State Allocation Board last night voted to formally notify the California Senate and Assembly that state funds for new school facility construction are no longer available. The decision, by a 6 to 4 vote, will enable school districts that have adopted Level 2 fees to collect fees at twice the Level 2 rate.

ApprovedSenate Bill 50, which became law in 1998, authorizes school districts to charge developer fees at one of three levels. The base statutory rate, known as the “Level 1 fee,” is currently $3.48 for residential development and $0.56 for commercial development. School districts that satisfy certain criteria may charge “Level 2” fees in an amount intended to fund 50% of the cost of providing facilities for students from new residential development. SB 50 authorizes districts that have adopted Level 2 fees to charge fees at a “Level 3” rate if the State Allocation Board certifies that state funds for new school facility construction are no longer available. The Level 3 rate can be up to double the amount of the Level 2 fee adopted by the school district. Over 200 school districts have adopted Level 2 fees. The doubling of such fees could result in developers in some districts paying more than $30,000 in school mitigation for each new home.

The SAB’s action comes as a deep disappointment to the building industry, which has been actively working to pass a statewide $9 billion school bond currently on the November 2016 ballot. The school bond initiative was sponsored by Californians for Quality Schools – a coalition of the California Building Industry Association and the Coalition for Adequate School Housing, a school district organization. (See our report on the background of the $9 billion bond measure — $9 Billion School Bond Measure Headed for November 2016 Ballot). The full text of the bond measure can be found here.

The CBIA is seeking immediate injunctive relief in Sacramento Superior Court to prevent the SAB’s action from going into effect. CBIA contends that the SAB’s determination that state funds are no longer available is erroneous because over $150 million in funding for new construction approved by the voters in 2006 remains to be apportioned.  A court decision on CBIA’s request for a temporary restraining order is expected later today.

Ordinance Prohibiting Mobile Medical Marijuana Dispensaries Was Not a “Project” Under CEQA

A California Court of Appeal has held that a city ordinance prohibiting mobile medical marijuana dispensaries within city boundaries did not constitute a “project” under the California Environmental Quality Act.  Union of Medical Marijuana Patients, Inc. v. City of Upland, 245 Cal.App.4th 1265 (2016).

In 2007, the City of Upland adopted a zoning ordinance prohibiting any medical marijuana dispensary — whether fixed or mobile – in any zone within the city. The City prepared and adopted a negative declaration under CEQA, which concluded that the ordinance would have no significant effect on the environment. No one challenged the City’s negative declaration.Flowers

In 2013, the City adopted an ordinance that specifically prohibited mobile marijuana dispensaries within the City. Based on its findings that mobile dispensaries are associated with increased criminal activity and that 34 mobile dispensaries just outside the City advertised direct delivery of marijuana, the City concluded that there was “a high likelihood that mobile dispensaries will immediately flourish in the City without the adoption of this Ordinance.”

The Union of Medical Marijuana Patients, Inc. (UMMP) submitted comments arguing that the 2013 ordinance constituted a “project” under CEQA that would have “foreseeable environmental effects,” including “(1) increased travel by residents who would now be forced to travel outside the City to obtain medical marijuana; and (2) increased indoor cultivation activity within the city” which would result in increased utility use and hazardous waste. The City did not respond to these comments, and UMMP filed a petition for writ of mandate challenging the validity of the 2013 ordinance for failure to comply with CEQA.

The Court of Appeal affirmed the trial court’s denial of the petition, holding that the 2013 ordinance was not a project subject to CEQA because the ordinance “merely restates the prohibition on mobile dispensaries that was imposed by the 2007 ordinance.” The Court noted that the ordinance met the first prong for determining whether the ordinance was a project subject to CEQA because “it was an activity directly undertaken by [a] public agency.” Nonetheless, the ordinance, as a mere restatement of the previous ordinance, failed the second prong because it was not an activity that “may cause either a direct  physical change in the environment, or a reasonably foreseeable indirect physical change in the environment.” (Guidelines § 15378.)

The Court rejected UMMP’s contention that the 2013 ordinance was not a restatement of the 2007 ordinance because the 2007 ordinance was essentially a zoning ordinance adopted to regulate land use, not to regulate activities undertaken with motor vehicles. According to the Court, the 2007 ordinance did not regulate land use only, and its codification in the municipal code’s zoning title did not so limit the scope of the provision. While the main focus of the 2007 ordinance was on fixed dispensaries, which is a proper zoning function, the Court found no impediment to City prohibiting any dispensaries, whether fixed or mobile.

Finally, the Court concluded that even if the 2013 ordinance was not a mere restatement, it did not constitute a project for CEQA purposes because ‘[t]he ostensible environmental impacts UMMP cites” were based on layers of assumptions about what might occur as a result of the ordinance. UMMP offered no evidence to support its argument that residents currently obtaining marijuana from mobile dispensaries “would be forced to travel greater distances” to obtain the medication or that the ordinance would result in indoor cultivation, leading to increased electrical and water consumption, waste plant material and odor, and hazardous waste materials associated with fertilizing and harvesting marijuana plants. These alleged impacts, the court ruled, were too “speculative and unlikely” to be deemed “reasonably foreseeable.” (Guidelines § 15064, subd. (d)(3).)

The case follows a long line of California decisions rejecting challenges to municipal regulation of medical marijuana facilities on various grounds. (See, e.g., our recent post, California Cities and Counties Can “Just Say No” to Medical Marijuana Dispensaries)

Wetland Jurisdictional Determinations: Reviewable or Not?

Last week, the Supreme Court heard oral arguments in the case of United States Army Corps of Engineers v. Hawkes Co. (Supreme Court Case No. 15-290), which poses the question of whether a determination by the Army Corps that a property contains “waters of the United States” under the Clean Water Act is a final agency action that may be challenged in court. This is an important question, since a Jurisdictional Determination can significantly affect a landowner’s right to develop and there has been a notable lack of clarity under the law over the last decade regarding what waters are covered by the Clean Water Act and what waters are not.

Supreme_Court_Front_DuskA Jurisdictional Determination is an official decision by the Corps that a property contains waters, such as wetlands, that are subject to the Clean Water Act’s permitting requirements. If a property is subject to such a determination, the landowner must obtain a permit from the Corps before developing the property and could be subject to heavy fines if he or she violates this requirement. There is a split among the circuit courts on whether an aggrieved landowner can challenge such a determination in court.

In 2014, the Fifth Circuit ruled that a Jurisdictional Determination is not a final agency action subject to judicial review, on the ground that it merely alerts the landowner that a permit will be required in the future if the landowner pursues plans to develop the subject property. Under this line of reasoning, an aggrieved landowner must wait to challenge the determination in court until there is either a final decision by the Corps on a permit application or some form of enforcement action by the federal government (such as the issuance of a compliance order or a proceeding to impose fines). See Belle Company v. U.S. Army Corps of Engineers, 761 F.3d 383 (5th Cir. 2014). The court reached a similar conclusion in National Association of Home Builders v. U.S. Environmental Protection Agency, 956 F. Supp. 2d 198 (D.D.C. 2013), affirmed on other grounds, 786 F.3d 34 (D.C. Cir. 2015).

But the Eighth Circuit reached the opposite result in the Hawkes case in April 2015, concluding that a Jurisdictional Determination has “a powerful coercive effect” and should be subject to “immediate judicial review.” Hawkes Co., Inc. v. United States Army Corps of Engineers, 782 F.3d 994 (8th Cir. 2015). In December 2015, the Supreme Court agreed to review the Eighth Circuit’s decision.

At the oral argument last week, the government faced a number of tough questions and serious concerns were expressed by the Justices about its position that Jurisdictional Determinations are merely a type of informal advice or information, rather than a binding determination with legal consequences that should be subject to judicial review. Based on the oral argument, it appears the Justices may be looking for a narrow way to make Jurisdictional Determinations immediately reviewable, without broadly affecting other forms of compliance advice that is routinely provided by federal agencies. Stay tuned for the final decision.

Ninth Circuit Rules Navy Satisfied NEPA in Considering Potential Terrorist Threat to San Diego Facility

The Ninth Circuit has rejected a claim, under the National Environmental Policy Act, that the Navy did not adequately consider the environmental consequences of a potential terrorist threat to the redevelopment of a military complex near downtown San Diego.  The opinion upheld the Navy’s Environmental Assessment for the complex, which concluded that the project would not create the potential for a significant impact from a terrorist attack. San Diego Navy Broadway Complex Coalition v. United States Department of Defense, No. 12-57234 (9th Cir. March 30, 2016).

060823-N-6843I-124 Sacramento, Calif. (Aug. 23, 2006) - Commander, Navy Region Southwest Rear Adm. Len R. Hering Sr. speaks to reporters during a press conference for assembly bill (AB) 1965 at the California State Capitol building. AB 1965 is a proposal to help stop predatory lending practices such as charging service members high interest rates on short-term loans. A survey by the Defense Manpower Data Center showed that 13 percent of Sailors have used predatory loans in the last 12 months, where interest rates can exceed 1,000 percent and cost military members and their families more than $80 million in yearly fees. U. S. Navy photo by Mass Communication Specialist 3rd Class S. C. Irwin (RELEASED)


The Navy first approved the redevelopment of the complex in 1991.  The project included both military functions and private commercial uses to generate revenue.  However, adverse real estate conditions in San Diego delayed the project until the mid-2000s.  In 2006, the Navy prepared an EA for the project to supplement its prior NEPA analysis from the early 1990s, and it executed a lease with a private development partner.  But a citizens group filed a NEPA lawsuit, and the district court ruled that the Navy had failed to provide adequate public notice for the EA.

In response, the Navy prepared a new EA and reapproved the project in 2009.  The new EA included a discussion of a potential terrorist attack, due to the Ninth Circuit’s ruling in San Luis Obispo Mothers for Peace v. Nuclear Regulatory Commission, 449 F.3d 1016 (9th Cir. 2006), which had held that a categorical dismissal of the potential impacts from a terrorist attack at an installation built to store spent nuclear fuel rods was unreasonable under NEPA.  The Navy’s new EA concluded that a terrorist attack at the complex in San Diego was too speculative and remote to require NEPA analysis, since there was no known specific threat targeting the complex or its location.  The EA also explained that anti-terrorism building specifications would be followed to reduce the risks posed by a potential terrorist attack.  The EA thus concluded that the project would not place military or civilian personnel in jeopardy and would not result in a significant impact under NEPA. Continue Reading

Inadvertent Disclosure of Documents Under the Public Records Act Does Not Waive the Attorney-Client Privilege

The California Supreme Court has resolved a significant split among California appellate courts regarding whether inadvertent disclosure of documents in response to a Public Records Act request results in waiver of the attorney-client privilege pursuant to section 6254.5 of the Act. The court held that this waiver provision applies only to intentional release of a public record, and hence that a public agency’s inadvertent disclosure of a document does not waive applicable privileges.  Ardon v. City of Los Angeles, No: S223876 (March 17, 2016)

An attorney representing the plaintiff in a pending class action against the City of Los Angeles served the City with a request for documents under the Public Records Act. In response, an assistant city administrative officer provided the attorney with approximately 53 documents, among which were three memos containing attorney-client communications. After discovering this, the City notified plaintiff’s counsel that the privileged documents had been produced inadvertently, and requested their return. After plaintiff’s counsel refused, the City filed a motion to compel return of the documents, which was denied by the trial court.LosAngeles06

In a published decision, the Second District Court of Appeal affirmed the trial court’s ruling, concluding that production of the documents had waived any privilege pursuant to Section 6254.5 of the Act. The California Supreme Court granted the City’s petition for review of this decision. While review was pending, the First District Court of Appeal decided Newark Unified School District v. Superior Court, No. A142963 (1st Dist. Ct. App., August 1, 2015). As discussed in our report on that case (Court Rejects “Gotcha” Theory of Waiver Under Public Records Act), the First District held that inadvertent disclosure of documents containing attorney-client communications in response to a Public Records Act request does not result in a waiver of the privilege under section 6254.5. Continue Reading

Assessing traffic impacts under CEQA

In enacting CEQA, the Legislature established a policy to “provide the people of this state with clean air and water, enjoyment of aesthetic, natural, scenic and historical environmental qualities, and freedom from excessive noise.” The Legislature did not mention freedom from intersection congestion. Yet detailed analyses of roadway levels of service and intersection delay have emerged as one of the most contentious and costly steps in the CEQA process. The addition of a handful of vehicles to a congested intersection can trigger preparation of a full EIR. And housing advocates have long contended that CEQA presents an obstacle to affordable housing near jobs. Read the full article.

Governor’s Office Moves One Step Closer to Eliminating Automobile Delay as a Significant CEQA Impact

On January 20, 2016, the Governor’s Office of Planning and Research released a revised draft of proposed new CEQA Guidelines to replace automobile congestion-based thresholds for evaluating transportation impacts with thresholds that emphasize proximity to transit and a reduction in vehicle miles traveled (VMT) on a per capita or per employee basis.

SB 743, passed by the Legislature in 2013, requires OPR to establish thresholds for measuring transportation impacts that are designed to promote the reduction of greenhouse gas emissions, the development of multimodal transportation networks, and a diversity of land uses., Further, SB 743 dictates that once the CEQA Guidelines are amended to include those new thresholds, auto delay will no longer be considered a significant impact under CEQA.  SB 743 gives OPR the option of applying the new thresholds only to certain locations near transit, or more broadly throughout the State.

OPR released its preliminary discussion draft of the Guidelines amendments in August 2014. The initial draft applied the new thresholds broadly, and focused generally on an assessment whether a project would result in VMT that would exceed regional averages. Vertikalni_semafor_animThe initial draft also suggested thresholds for measuring significance based on proximity to certain types of transit stops and lines.

In the updated recommendations released on January 20, the proposed Guidelines continue to apply a new VMT-based approach to all areas of the State.  Agencies would have a two-year period to transition to the new VMT-based approach.  Further, as under the initial draft, once this transition period ends, automobile delay could no longer be considered a significant adverse effect under CEQA.

The updated recommendations also continue to include a presumption that development projects located within one-half mile of either an existing major transit stop or a stop along an existing high quality transit corridor may be presumed to cause a less than significant.

A key difference between the newly proposed Guidelines and the initial draft is that the Guidelines themselves do not set forth specific standards to assess whether a project’s effect on VMT is a significant adverse impact. Much of the detail is now found in a Technical Advisory. The Advisory recommends thresholds for specific types of land uses, including the following:

  • Residential: A project exceeding both existing city household VMT per capita minus 15 percent, and existing regional household VMT per capita minus 15 percent, may indicate a significant transportation impact.
  • Office: A project exceeding a level of 15 percent below existing regional VMT per employee may indicate a significant transportation impact.
  • Retail: A net increase in total VMT may indicate a significant transportation impact. Further, “Lead agencies should usually analyze the effects of a retail project by assessing the change in total VMT, because a retail projects typically re-route travel from other retail destinations.”
  • Mixed Use: Lead agencies can evaluate each component of a mixed-use project independently, and apply the significance threshold for each project type included (e.g. residential and retail). In the analysis of each use, a project may take credit for internal capture.

Continue Reading

Agency’s CEQA Analysis Must Consider the Project’s Long-Term Impacts

The Third Appellate District’s opinion in North Coast Rivers Alliance v. A.G. Kawamura (January 4, 2016) has left some practitioners scratching their heads trying to decipher the court’s holdings regarding CEQA requirements for projects that might continue operating past their initial termination date, project objectives, alternatives and cumulative impacts.

The California Department of Food and Agriculture prepared a program EIR for a seven-year program to eradicate the light brown apple moth, an invasive pest. The EIR determined that because an alternative of controlling the moth would not achieve the project objective of eradicating the moth, a control program would not be studied.

Epiphyas_postvittanaAfter the EIR was completed the USDA advised that the moth infestation had spread to such an extent that eradication was no longer feasible. The Department then approved a seven-year control program, based on the program EIR, finding the control program would use the same methods as were proposed for the eradication program, but to a lesser degree, resulting in lesser impacts.

The cities of Albany, Berkeley, Richmond and San Francisco, together with environmental organizations and anti-spray groups sued, challenging the Department’s approval on CEQA grounds. The appellate court agreed with several of their claims.

Fundamentally, the court found that the Department failed to evaluate the ongoing long-term impacts of the control program, in light of the EIR’s concession that a control program “would have to go on forever.” Because of these EIR statements, the court rejected the Department’s argument that it would be speculative to assume the control program would continue after the initial seven-year period.

As might be expected, the petitioners had argued that the Department’s approach amounted to unlawful piecemeal review of the first stage of an activity that would continue to operate over an indefinite period of time, but the court did not rule on that ground. Somewhat surprisingly, it instead identified a CEQA violation due to the Department’s reluctance to promise to prepare another EIR in the future. The court acknowledged that CEQA sometimes allows use of an earlier EIR for later activities, making it unnecessary to prepare a further EIR. The court, however, did not consider whether that rule could be applied to the control program, concluding that despite the possibility a new EIR might be prepared for the continuation of control activities after seven years, the EIR violated CEQA because it did not examine the impacts of those later activities.

The court also held that the EIR failed to address a reasonable range of alternatives. It did not discuss whether the alternatives that were considered – amounting essentially to a menu of potential methods of eradicating the moth and a no project alternative – comprised too narrow a range. In a novel ruling, it concluded that CEQA required study of a specific alternative that might have greater impacts than the proposed project — a never-ending control program.

The court then discussed whether the failure to study this alternative amounted to prejudicial error. To assess prejudice, it impliedly raised a question whether recirculation was required to address the impacts of a control program alternative. It cited case law to the effect that recirculation is only required when new significant information is added after circulation of a Draft EIR. The court, however, concluded that the new information “was clearly significant,” because it caused the Department “to change the program.”

The court labelled as “supposition” the Department’s reasoning that a control program would have lower impacts than an eradication program because it would employ the same measures but to a lesser degree. Noting that the record “supports an opposing inference” because a control program would need to go on forever, the court concluded that the EIR’s failure to study a control program left the record devoid of evidence to resolve the dispute. The court concluded that, as a result, there was no substantial evidence in the Department’s record sufficient to support its determination the new information was not significant.


A Summary of Published Appellate Opinions Under the California Environmental Quality Act

In 2015, the California appellate courts continued to chart new ground as they grappled with some of CEQA’s most difficult and controversial questions. The  Supreme Court of California led the way, issuing four opinions on hotly contested issues. For the first time, the court addressed the problematic question of what thresholds of significance should be used to measure the significance of greenhouse gas emissions. In a decision that likely pleased few, the court blessed consistency with AB 32’s emissions reduction goal as an appropriate standard, but provided little guidance on how agencies might show consistency for specific projects.

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On the other hand, the court issued two decisions that place reasonable, common-sense limits on CEQA’s reach. In one decision, the court set constraints on the ability of project opponents to contest categorical exemption determinations by asserting that significant impacts will occur due to unusual circumstances. In the other, the court put an end to the counter-intuitive but persistent argument that CEQA extends beyond a project’s effects on the environment to require review of the environment’s effects on the project. In its final decision, the court held that a state university cannot use the legislature’s failure to appropriate earmarked funds as an excuse to avoid adopting mitigation measures for off-site impacts, but did not decide when a public agency can reject a proposed mitigation measure as infeasible due to budgetary constraints.

The year was also notable for the number of opinions dealing with CEQA exemptions. Two cases upheld categorical exemptions, applying the standards set by the supreme court in its decision on the unusual circumstances exception. In three others, the courts overturned the agency’s exemption determination, ruling in one case that the agency had interpreted the exemption too broadly, and in the others that the agency had failed to point to evidence in the record of its proceedings sufficient to show the exemption applied.

Seven court of appeal decisions addressed EIR adequacy, and upheld the EIR in every case. The proper baseline for analyzing impacts was an important theme, with the courts making it clear that a lead agency has broad discretion to set a baseline that reflects historical conditions occurring well before CEQA review starts. In another precedent-setting decision, a court held that an increased demand for emergency services due to a project is not an environmental impact that triggers CEQA’s mitigation requirements. The use and benefits of program EIRs also received significant attention in opinions recognizing that agencies may use program EIRs to defer evaluation of project-specific impacts and mitigation strategies to a later stage of approval when the information necessary for a detailed analysis becomes available. Finally, in what may prove to be one of the year’s most influential decisions, a court disapproved the practice of besieging the lead agency with burdensome comments on a draft EIR in order to stymie the EIR process, emphasizing that the purpose of comments should be to improve the EIR, and that the opportunity to comment should not be used as a means to wear out the lead agency.


CEQA Year in Review 3