In a lengthy opinion tackling several of CEQA’s hot topics, a court of appeal has rejected the EIR for the Martis Valley West project, finding its Lake Tahoe water quality analysis, GHG and traffic mitigation measures, and energy analysis inadequate. League to Save Lake Tahoe Mountain Area Preservation Foundation v. County of Placer, 75 Cal.App.5th 63 (2022). The court upheld other EIR analyses – most notably the section analyzing wildfire evacuation – as well as the county’s compliance with the Timberland Productivity Act.

Background

Sierra Pacific Industries owned two large undeveloped parcels bordering the Lake Tahoe Basin and spanning State Route 267. It proposed a specific plan and other approvals for 760 residential units and commercial uses on 662 acres of its west parcel, along with permanent conservation of its 6,376-acre east parcel. Placer County approved the project after certifying an EIR and rezoned the development site from Timberland Production Zone to Specific Plan.

CEQA

  1.  Air Quality Significance Threshold Upheld

Plaintiffs alleged that although the development site was outside the jurisdiction of the Tahoe Regional Planning Agency (TRPA), the EIR should have used TRPA’s vehicle miles traveled (VMT) significance threshold, or the science behind it, to analyze the impact of project-induced VMT on Lake Tahoe Basin air quality. The county instead applied the thresholds recommended by the Placer County Air Pollution Control District. The court found that although TRPA was a trustee agency under CEQA and the county was required to consider TRPA’s views, the county was also entitled to select its own significance threshold if it was supported by substantial evidence. The court held that — unlike in the 2021 case of Sierra Watch v. Placer County — here the county identified and applied a significance threshold that was supported by substantial evidence.

  1. Lake Tahoe Water Quality Setting and Impact Analysis Rejected

The court agreed with plaintiffs that the EIR did not adequately describe Lake Tahoe’s existing water quality or analyze another impact of project-induced VMT: roadway abrasives and sediments sent airborne by vehicle tires and then settling into Lake Tahoe. The court held that data on this issue provided after issuance of the final EIR was too late and that “it should not be difficult” for the county to correct this error.

  1. Greenhouse Gas Mitigation Rejected

A GHG mitigation measure required future developers within the specific plan area to demonstrate that their projects would be consistent with then-current GHG emission targets adopted by the state, “where those targets, in compliance with the rule of Newhall Ranch, are based on ‘a substantiated linkage’ between the project and statewide emission reduction goals.” Because such targets did not exist and might never exist, and the final EIR did not discuss how the mitigation measure would apply if such targets were never developed, the court agreed with plaintiffs that the mitigation measure violated CEQA.

  1. Wildfire Evacuation Analysis Upheld

Plaintiffs alleged the EIR’s analysis of the project’s impact on emergency response and evacuation plans during a wildfire did not adequately address congestion on State Route 267 or possibilities such as an overturned boat trailer blocking that route. The court rejected this challenge, citing the project’s creation of multiple evacuation and emergency access routes, a shelter-in-place location, and a detailed project-specific emergency plan. The court noted the role of emergency responders in managing evacuation along Route 267 and CEQA’s principles that an EIR cannot be expected to address every possibility and is not required to use a worst-case analysis.

  1. Forest Resources Cumulative Impact Analysis Upheld

Plaintiffs alleged that, contrary to the EIR’s conclusion, tree loss from project development would represent a cumulatively considerable contribution to tree loss that was already occurring in the county due to climate change. The court rejected this argument because tree loss under the specific plan was consistent with the county’s 1994 projection of regional forest loss, which the county had found to be less-than-significant. The court declined to consider future tree loss from climate change a cumulative “project.”

  1. Traffic Congestion Mitigation Measure Rejected

The court rejected the EIR’s reliance on payment of a fee toward widening of Route 267 as mitigation for the project’s impacts to traffic congestion, agreeing with plaintiffs that the EIR should have considered vehicle trip reduction measures such as transit subsidies as an alternative to Route 267 widening. The court’s opinion does not mention Citizens for Positive Growth & Preservation v. City of Sacramento, the 2019 case holding that challenges to congestion-based traffic analysis became moot under CEQA as of December 2018.

  1. Discussion of Impacts of Route 267 Widening Upheld

Plaintiffs also alleged that the mitigation measure requiring payments toward State Route 267 widening violated CEQA because that widening project itself had not yet undergone full CEQA review. The court rejected this claim on the ground that the county had already analyzed the widening at a program level and that the widening would undergo full CEQA review “once Caltrans proceeds with the project.”

  1. Energy Analysis Rejected

The court held that an EIR’s analysis of energy impacts is required to discuss whether the project could increase its reliance on renewable energy sources.

Timberland Productivity Act

Plaintiffs alleged that the county’s findings supporting rezoning of the development site from Timberland Production Zone (TPZ) to “Specific Plan” did not comply with the state Timberland Productivity Act. The Act, like the Williamson Act that applies to agricultural lands, allows a property owner to designate its land for timber production and obtain tax benefits in return. To waive the Act’s normal ten-year notice requirement for rezoning from TPZ and approve immediate rezoning, a jurisdiction must, among other requirements, make findings that immediate rezoning would not be inconsistent with the purposes of the Act.

The court rejected plaintiffs’ two challenges to the county’s findings. The first was that the county could approve immediate rezoning only if it explained why waiting ten years would be inconsistent with the purposes of the Act. The second argument was that in its consideration of rezoning 662 acres of the west parcel, the county could not consider the property owner’s proposal to rezone 670 acres of its east parcel back into TPZ. The court found no support in the Act for either of these proposed requirements.

 

The Court of Appeal held that an action to set aside an ordinance restricting short-term vacation rentals on the ground of failure to obtain a Coastal Development Permit (CDP) was barred by the 90-day statute of limitations for challenges to adoption or amendment of zoning ordinances. Coastal Act Protectors v. City of Los Angeles, No. B308306 (4th Dist., Feb. 24, 2022).

In December 2018, the City of Los Angeles adopted an ordinance placing restrictions on short-term vacation rentals. Over a year later, petitioner filed suit to enjoin enforcement of the ordinance until the City obtained a CDP, claiming the ordinance constituted a “development” under the Coastal Act. The trial court dismissed the action as untimely under the 90-day statute of limitations in Government Code section 65009(c)(1), which applies to actions to “attack, review, set aside void, or annul” a decision to adopt a zoning ordinance.

On appeal, petitioner argued that the trial court erred in concluding its action was barred under section 65009(c)(1) because the City’s failure to comply with the Coastal Act was “not an ‘action’ or decision contemplated by [section 65009].” Petitioner contended the action was instead subject to the three-year statute of limitations in Code of Civil Procedure section 338(a) for actions “upon a liability created by statute.”

The Court of Appeal disagreed. It pointed out that the Coastal Act, including the CDP requirement, predated adoption of the ordinance. Thus, assuming the City had a mandatory duty to obtain a CDP in order to impose the rental restrictions, that duty existed at the time the City enacted the ordinance. The action, therefore, was one to “attack, review, set aside, void, or annul” the City’s decision to adopt a zoning ordinance without first obtaining a CDP. Petitioner waited over a year, however, to file its suit. Thus, the action was time-barred under section 65009’s 90-day deadline.

The court added that its conclusion was consistent with the Legislature’s stated intent to “provide certainty for property owners and local governments regarding local zoning and planning decisions. (§ 65009(a)). The court noted that, after allowing for the 90-day period for challenges to the ordinance to expire, the City had expended significant resources to implement and enforce the ordinance, including $485,609 to build an online registration system and approximately $1.4 million for a one-year monitoring of the system.

The Court of Appeal found that a development project that was consistent with a previously approved specific plan was not required to prepare a new EIR because no changes significantly increased impacts on endangered species. Citizens’ Committee to Complete the Refuge v. City of Newark, No. A162045 (1st Dist., Dec. 29, 2021).

In 2010, the City of Newark certified an environmental impact report for a specific plan covering Areas 3 and 4, located next to San Francisco Bay. The EIR stated that the City would evaluate all new projects in accordance with CEQA Guidelines section 15168, which allows the City to use a checklist or initial study to evaluate specific development proposals, and that no further environmental documents would be required for subsequent activities found to be within the scope of the specific plan EIR.

In 2019, the City approved a subdivision map for development of residential lots on a portion of Area 4. The City prepared a checklist comparing the analysis in the EIR with the impacts of the proposed project. The checklist included supporting materials such as plans, letters, expert memos, and technical reports, including an updated analysis of the effects of sea level rise. The City approved the project after finding that it would have no significant impacts. The plaintiffs challenged the map approval and the use of the checklist.

The court of appeal held that the subdivision map was exempted from further CEQA review under Government Code section 65457 because it was consistent with the specific plan, which had a certified EIR. Under that circumstance, no further environmental review is required in the absence of substantial changes to the project or the circumstances under which the project will be developed or if new information becomes available.

The plaintiffs claimed that there were three aspects of the subdivision map that were significantly different from the specific plan analyzed in the EIR and would have significant new impacts on the salt marsh harvest mouse. However, substantial evidence supported the City’s conclusion that none of the changes would significantly increase the impacts on the harvest mouse beyond those addressed in the EIR. The court recognized that there was proposed use of riprap to reduce erosion, which was not mentioned in the EIR, but held that this did not rise to the level of a “[s]ubstantial change[] . . . in the project which will require major revisions of the environmental impact report.” While plaintiffs argued that use of riprap deserved further study because it would substantially increase the severity of rat predation of the harvest mouse, they failed to offer any substantial evidence to support this claim.

Plaintiffs also contended that the project risked exacerbating the effects of sea level rise on the environment because of the interaction of the project with wetlands in the area. The court found that, even if plaintiffs’ theory was correct, these dynamics were not new in relation to this project, so the City did not need to address them in reviewing the project—the time to address them, if at all, was in relation to the original EIR.

The court likewise rejected plaintiffs’ argument that a hydrology report’s reliance on adaptive management to address flooding of the project from sea-level rise (such as by creating levees or floodwalls) amounted to improper deferral of mitigation measures. The court reasoned that because sea level rise was not an impact on the environment caused by the project, neither the EIR nor the checklist needed to discuss this impact. For the same reason, the adaptive responses to sea level rise discussed in the hydrology report were not mitigation measures were not governed by the rules concerning deferred mitigation.

On January 19, 2022, attorneys from Perkins Coie presented the 32nd Annual Land Use and Development Law Briefing.

Topics included:

    • Developments in Land Use Law
    • Housing Legislation Update
    • Real Estate Due Diligence
    • CEQA — Cases, Legislation and Trends
    • Regulatory Compliance, Investigations and Enforcement
    • Wetlands, Species and Federal Environmental Review

A full set of the written materials, in pdf form, is available: 32nd Annual Land Use and Development Law Briefing Materials.

If you would like a bound, hard copy of the materials, please click here.

Selected materials from the presentation have also been posted on the California Land Use and Development Law Report: CEQA Year in Review 2021;  2021 Land Use and Development Law Case Summaries

Below are summaries of the key California and Ninth Circuit land use and development law cases decided in 2021.

1.  Planning and Zoning

CHEVRON v. COUNTY OF MONTEREY
70 Cal. App. 5th 153 (2021)

A county ordinance enacted by initiative effectively banned new oil and gas wells and use of wastewater injection (“fracking”) as part of extraction operations. The court held that these measures were preempted by Public Resources Code § 3106, which vests the State of California’s Oil and Gas Supervisor with exclusive authority to decide whether to permit an oil and gas drilling operation or the use of wastewater injection in such operations, leaving no room for local regulation. The court noted that its holding did not affect local regulation of the location of oil drilling operations, a matter not addressed by Section 3106 or the ordinance.

PEOPLE v. VENICE SUITES
71 Cal. App. 5th 715 (2021)

The State of California brought action alleging that the owner of an apartment building was illegally operating a hotel or transient occupancy structure in a building permitted to operate only as an apartment house for long-term tenants. The court held that the Los Angeles Municipal Code did not implicitly prevent an apartment house from being used for short-term occupancies of 30 days or less. The court reasoned that (1) a long-term occupancy requirement for apartment houses could not be inferred from definitions in a later-enacted section of the Code limiting transient occupancy structures to occupancies of 30 days or less and (2) the Code governing apartment houses could not be read in conjunction with either the rent stabilization ordinance or the transient occupancy tax ordinance to require long-term occupancy.

SCHREIBER v. CITY OF LOS ANGELES
69 Cal. App. 5th 549 (2021)

The density bonus law (Gov’t Code § 65915) requires cities to grant incentives to projects that provide a specified number of affordable housing units. Plaintiffs challenged the City’s grant of certain incentives to a project on the ground that the City had failed to require the applicant to provide financial documentation proving that the incentives were required to make the project “economically feasible” as required by a local ordinance. The court held that the referenced ordinance conflicted with Section 65915, which required the City, not the applicant, to bear the burden of proof justifying denial of a requested incentive. The local ordinance was accordingly preempted by Section 65915.

2. Coastal Act

KRACKE v. CITY OF SANTA BARBARA
63 Cal. App. 5th 1089 (2021)

In 2015, the City of Santa Barbara directed its staff to regulate short-term rentals as hotels, effectively banning short-term rentals in most residential areas. The court held that the City’s change in policy required Coastal Commission approval because it constituted a “development,” altering the intensity of use and access to land and water in the coastal zone. To proceed, the City would need to obtain a coastal development permit, an amendment to its certified local coastal program, or an amendment waiver. This decision reinforced that restrictions on short-term vacation rentals in the coastal zone—whether by a private entity or a local government—are subject to the Coastal Act and must be approved by the Coastal Commission.

LENT v. CALIFORNIA COASTAL COMMISSION
62 Cal. App. 5th 812 (2021)

The court upheld a Coastal Commission penalty of $4,185,000 on Malibu homeowners who refused to remove structures that blocked a public access easement granted to the Commission by a prior owner of the home. The homeowners claimed the penalty violated their due-process rights because it was over four times the amount recommended by Commission staff. The court ruled that due process did not mandate advance notice of the exact penalty the agency intended to impose so long as the agency provided adequate notice of the maximum amount of the possible penalty, which it did in this case. The court also found that the penalty did not amount to an excessive fine under the state or federal constitutions because the homeowners had a high degree of culpability—evidenced by their willful refusal to remove the structures—and their conduct effectively barred access to a beach that was part of a three-mile stretch of the coast with no other public access. Continue Reading 2021 Land Use and Development Law Case Summaries

The Second District Court of Appeal held that a Board of Supervisors decision on the appeal of a conditional use permit from the Planning Commission was untimely under the County Code and hence that the Planning Commission’s decision was deemed affirmed. Tran v. County of Los Angeles, No. B309226 (2nd Dist., Jan. 21, 2022).

The owner of a liquor store applied for renewal of the store’s conditional use permit for the sale of beer, wine, and spirits. The County Regional Planning Commission approved the conditional use permit. A member of the Board of Supervisors requested review of the Planning Commission’s decision, which the Board approved and the matter was set for public hearing on August 1, 2017. At the conclusion of that hearing, the Board approved a motion to “indicate its intent to approve” the CUP with restrictions more stringent than those approved by the Planning Commission and instructed county counsel to prepare the necessary findings and conditions for approval of the CUP.

On March 20, 2018, on its consent calendar, the Board adopted the findings and conditions prepared by county counsel and approved the CUP. The owner filed suit to reinstate the Planning Commission decision, contending that the Board decision was void because it had not been rendered within 30 days after the public hearing as required under the Los Angeles County Code.

The County Code provided that decisions by the Board “on appeals or reviews shall be rendered within 30 days of the close of the hearing.” The County argued that the 30-day requirement was directory, not mandatory; i.e., that the failure to take action within the 30-day period did not render the decision invalid. The appellate court disagreed, noting that the determination whether a procedural requirement is mandatory or directory is determined largely by its effect: If the failure to comply does not invalidate the action, the requirement is deemed directory; if, on the other hand, noncompliance does invalidate the action, the requirement is deemed mandatory.

Here, the 30-day decision requirement in the Code was mandatory, not directory, because another provision of the Code stated that if the “Appeal Body fails to act upon an appeal within the time limits prescribed . . . the decision from which the appeal was taken shall be deemed affirmed.”

The court also rejected the County’s argument that the Board rendered its “decision” when it adopted its “intent-to-approve” resolution at the close of the public hearing in August 2017, not when it took the subsequent actions on its consent calendar in March 2018. The court reasoned that approval of a CUP is an adjudicatory determination for which the agency is required to make findings sufficient to enable the parties to determine whether and on what basis they should seek review. A resolution simply indicating “intent to approve” a CUP, with no accompanying findings, did not accord with the requirements for an adjudicatory decision. The court also observed that issuing an “intent-to-approve” determination was a common procedural device for local agencies, serving to provide notice to parties and the public of the agency’s intended decision in advance of finalizing the necessary findings or conditions, but not, in itself, an operative decision as commonly understood.

Here, the Board’s “decision” in the context of the relevant Code provisions occurred when it adopted the findings and approved the CUP in March 2018, not when it adopted its earlier “intent-to-approve” resolution. Because the Board failed to render its decision within 30 days of the close of the public hearing, the decision of the Planning Commission was deemed affirmed.

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

Introduction

The courts issued relatively few published CEQA decisions in 2021, with no California Supreme Court activity and no blockbuster court of appeal opinions. But two cases addressed topics of great current interest: wildfire and climate change impacts. One court also settled an important question under CEQA’s frequently invoked categorical exemption for infill development projects. And in a big year for exhaustion of administrative remedies as a prerequisite to litigation, three decisions reemphasized the key role played by local administrative procedures in the CEQA process.

Exemptions.  Three decisions on exemptions from CEQA came out during the year.  In one, the court had no trouble upholding application of the categorical exemption for small infill projects to a new gas station in a large shopping center, rejecting an argument that because the entire shopping center comprised more than 5 acres, the project, which would be built on only 2.5 acres, failed to meet the exemption’s limitation to 5-acre “project sites.”  In a second case, a court rejected an attempt to apply the existing facilities exemption to operations of an unlined landfill, ruling that unlined landfills did not constitute “facilities.” Finally, in a case involving the State Water Resources Control Board’s program for registering small water diversions when it receives a completed registration form, the court concluded: “CEQA does not regulate ministerial decisions—full stop.”

Negative Declarations. The two negative declaration cases decided during the year addressed key topical issues.  In a case in which neighbors raised concerns about evacuation during wildfires, the court concluded the objections were grounded in speculation rather than fact-based opinion, and upheld the negative declaration.  In the other case, the court found the agency had plainly erred by relying on a faulty climate action plan consistency checklist to find the project would not have a significant greenhouse gas impact.

Environmental Impact Reports. Several of the decisions involving EIRs are noteworthy.  The court of appeal reviewing the EIR for a new resort at Squaw Valley found it fatally flawed on multiple counts: Its description of the environmental setting failed to highlight the features of Lake Tahoe that make it a unique regional resource, and its analysis of water quality, air quality and construction noise impacts was insufficient.  By contrast, a court held that an EIR on a plan to restore natural resources and improve visitor facilities in a wilderness recreation area passed muster, even though it only considered one alternative — the no project alternative.  Another opinion in an EIR case provides useful guidance on the often perplexing requirement that EIRs identify “inconsistencies with the applicable general plan.” The deference due to a local jurisdiction in the interpretation and application of its own general plan under the Planning and Zoning Law cannot be evaded through a CEQA claim an EIR is defective by failing to “inform the public” of an inconsistency the agency has not itself found.

Subsequent CEQA Review. The only decision involving subsequent CEQA review addressed a set of somewhat puzzling claims.  The plaintiff challenged a decision by the State Lands Commission, acting as a responsible agency, to prepare a supplemental EIR, rather than a subsequent EIR, on limited changes to a previously approved desalination plant.  The court found no merit to appellant’s novel arguments that the commission was required to “step in as lead agency” and prepare a subsequent EIR on “the project as a whole” and that a supplemental EIR focusing on the project changes constituted improper “piecemeal” environmental review.

CEQA Litigation. Several thought-provoking opinions issued during the year involved CEQA litigation. In one, a court of appeal rejected a trial court order that allowed the agency to cure a defective mitigated negative declaration by preparing an EIR limited to three potentially significant impacts.  The court held that environmental review for a project cannot be split between two documents—a negative declaration and an EIR—and ruled that a “full EIR” was required.

In a decision that may cheer those who argue CEQA lawsuits are too often filed for improper purposes, the court found an aggrieved developer had identified evidence sufficient to allege a claim for malicious prosecution against a neighbor who had attacked the mitigated negative declaration for the developer’s project. Public agencies and project proponents should note, however, that behavior as egregious as that alleged against the neighbor in this case is, thankfully, rare.

Somewhat improbably, three of last year’s decisions involving CEQA litigation addressed a rarely asked question: What happens if the plaintiff doesn’t join the real party in interest in the lawsuit before the time to do so runs out?  The answer differs depending on the circumstances, but in sum: If a real party in interest is not sued timely and the real party is found to be “indispensable” as defined in the Code of Civil Procedure, then the suit will be dismissed.

Three other procedural decisions also provide an important reminder for both potential litigants and public agencies: To the extent a project opponent does not perfect its CEQA claims by following the local agency’s procedures for internal appeal of a CEQA determination, the opponent cannot pursue those claims in court.

Finally, one case decided during the year, although not surprising in its legal analysis, will likely be best remembered for its history:   After 27 years, the litigation over the EIRs on the Monterey Agreement—the agreement that changed the Department of Water Resource’s policies for allocating water supplied by the State Water Project—finally slogged its way to the finish line with an appellate court decision that resolved the remaining appeals in DWR’s favor, and a determination by the California Supreme Court that it would not review that decision.

The following summaries identify the key issues in the cases decided in 2021.  Each of these case summaries links to a post on this site that provides a more detailed description of the court’s opinion. Continue Reading CEQA YEAR IN REVIEW 2021

The court of appeal found that the California Coastal Commission erred by approving a coastal development permit for a residential development before environmental review for the project had been completed. Friends, Artists and Neighbors of Elkhorn Slough v. California Coastal Commission, 2021 WL 5905714 (No. H048088, 6th Dist., December 14, 2021).

The Commission’s staff report recommended that the permit be denied.  The report acknowledged the project would have significant adverse effects on the environment, that certain project modifications and design alternatives were necessary to address environmental issues, and that the project was inconsistent with several Local Coastal Program policies.  Nevertheless, at the conclusion of its hearing, the Commission approved the permit.  Staff then prepared a second report that analyzed, for the first time, various components of the project, mitigation measures, and conditions of approval. The report also contained a new, more favorable, analysis of oak woodland, water, visual, and traffic impacts, found the project would avoid significant environmental impacts, and took a new position on LCP consistency. The Commission’s findings for the permit approval were based on this report.

The court explained that the Commission must demonstrate full compliance with the provisions of its certified regulatory program in order to claim an exemption from CEQA’s EIR requirement.  This includes the requirement that a permit approval be preceded by the preparation of a written report which serves as the substitute for an EIR.  That report must contain detailed information on the project’s environmental impacts, alternatives, mitigation measures, necessary conditions of approval, and other information required to inform the Commission’s decision.

The court concluded the staff report for the Commission hearing was insufficient to serve this purpose.  It did not contain the complete discussion and analysis of the issues that must be provided before the Commission makes its decision. Because that information was not provided until the second report was prepared, after the Commission had acted, the court found its decision invalid.

 

Over a quarter century of CEQA litigation over the validity of an agreement between the Department of Water Resources and State Water Project contractors finally came to an end with the court of appeal’s decision in Central Delta Water Agency v. Department of Water Resources, 69 Cal. App. 5th 170 (2021), and the California Supreme Court’s denial of a petition for review of that decision.

In 1994, the Department of Water Resources entered into an agreement with State Water Project contractors called the “Monterey Agreement” in an effort to settle disputes over water allocations under long-term water supply contracts. Broadly, the Monterey Agreement modified formulas incorporated in the contracts for allocating water among SWP contractors, changed certain operations of SWP facilities and provided for the transfer of 20,000 acres of farmland for development of a water bank in Kern County.

Opponents challenged the legal adequacy of the program EIR on the Agreement. The court of appeal in Planning & Conservation League v. Department of Water Resources, 83 Cal.App.4th 892 (2000), found that the EIR violated CEQA because it had been prepared by two DWR contractors rather than DWR as lead agency, and continuation of a former contract provision relating to reduction in contractor entitlements in the event of a permanent water shortage should have been evaluated as a “no project” alternative. The court ordered DWR to prepare a new EIR but did not order that the Monterey Agreement, the contract amendments, or the land transfer be set aside, leaving it to the trial court to decide what further relief should be ordered. The case returned to the trial court, and after protracted negotiations, the parties entered into a settlement agreement which identified necessary contents of the EIR, allowed the SWP to continue operating as it had since the Monterey Agreement was adopted, and left the land transfer for the water bank in place.  The terms of the settlement were incorporated in the trial court’s writ of mandate.

In response to the writ of mandate, DWR continued ongoing operations under the Monterey Agreement while it prepared a new EIR. The new EIR was certified in 2010 and was quickly followed by three new lawsuits challenging its adequacy. Ultimately, the trial court upheld the new EIR, except for its assessment of the impacts of Kern Water Bank operations.  It ordered that the EIR be revised to reevaluate the water bank’s impacts on groundwater and water quality but allowed the Kern Water Bank to continue its ongoing operations in the meantime. Following certification of the revised EIR, yet another lawsuit was filed, but the trial court found the revised EIR was legally adequate and fully complied with court’s order. The court of appeal consolidated the appeals in the cases challenging the second and third EIRs.

Central Delta Water Agency, an appellant in the challenge to the second EIR, claimed that because that EIR treated continuation of SWP operations under the Monterey Agreement as the proposed project, the second EIR was an improper retrospective assessment of an ongoing project’s environmental impacts.  The court disagreed, concluding the approach taken was consistent with the writ of mandate, which allowed the project to continue while the new EIR was prepared.  The court also rejected an argument that the EIR should have included a “no project” alternative which would retain a prior contract provision that allowed DWR to refuse to deliver surplus water to contractors as necessary to avoid dependence on deliveries of surplus water.  The court found that the EIR had done enough by analyzing four no project alternatives, including two that addressed this prior contract provision, and also separately analyzed its practical effect.

In the case challenging the third EIR, appellant Center for Food Safety claimed, among other things, that the EIR failed to adequately address the water bank’s contribution to an increase in the planting of permanent crops that would result from improved water supply reliability.  The court disagreed, holding that the revised EIR’s finding that the water bank’s operations were not a primary cause of crop conversion it its service area was supported by substantial evidence, as was the EIR’s analysis of the impact of crop conversion on regional and statewide water supplies.  The court also rejected an argument that the trial court erred by issuing a limited remedy which allowed the water bank to continue operating while DWR revised the EIR.  Noting the trial court’s finding that invalidating the project approvals “would throw the entire SWP into complete disarray, smack in the middle of one of the most severe droughts on record,” the court of appeal concluded the trial court had not abused its discretion under the remedial provisions of CEQA, by allowing project operations to continue while the EIR was being revised.

The Monterey Agreement saga was finally concluded on January 5, 2022, when the California Supreme Court denied petitions seeking review of the court of appeal’s decision.

A trial court could not order a remedy that required preparation of an environmental impact report limited to the potentially significant impacts that led to invalidation of the project’s negative declaration — once the trial court found substantial evidence supported a fair argument that the project may have one significant environmental impact, it had no option but to require preparation of a “full EIR.” Farmland Protection Alliance v. County of Yolo, 71 Cal. App. 5th 300 (2021).

Yolo County had adopted a mitigated negative declaration for a use permit to construct and operate a bed and breakfast, commercial event facility and supporting on-site crop production.  The mitigated negative declaration acknowledged potentially significant impacts to agricultural resources and wildlife species and included measures to mitigate those impacts.

The trial court found substantial evidence supported a fair argument that the project may have a significant effect on three wildlife species despite the county’s adopted mitigation measures.  The trial court ordered the county to remedy this deficiency by preparing an EIR that would address the project’s impacts on the three relevant species.

The court of appeal characterized the question before it as whether an agency can comply with CEQA by preparing a negative declaration for some of a project’s impacts, and an EIR to address other impacts found to be potentially significant.  The court found no basis for allowing an agency to comply with CEQA by preparing a negative declaration to analyze some of the project’s impacts and an EIR to analyze others. CEQA requires that an EIR be prepared if any aspect of the project may have a significant effect on the environment. Thus, the court concluded that once a negative declaration is invalidated, the agency must prepare what it referred to as a “full EIR” for the proposed project—not an EIR confined to discrete impacts that would result from the project.