Categorical Exemptions

A California Court of Appeal held that CEQA’s issue exhaustion requirement did not preclude a challenge to Inyo County’s exemption determinations for condemnation proceedings and expanded operation of unlined landfills because the County failed to provide adequate notice that CEQA exemptions would be considered at its public meeting. As a matter of law, the Court

The Fourth District Court of Appeal held that the project baseline under CEQA for construction of a new home should not have been set prior to demolition of a potential historic structure when the demolition had occurred before submittal of a permit application to build the new home. Bottini v. City of San Diego, No. D071670 (4th Dist., Sep. 18, 2018).

The Bottinis applied to the City for a Coastal Development Permit (CDP) to construct a single-family home on a vacant lot. City staff determined that the project was categorically exempt from environmental review under CEQA’s Class 3 exemption for construction of a single-family home. On appeal, however, the City Council found that full environmental review was necessary because the Bottinis had demolished a 19th century cottage named Windemere on the lot shortly before applying for the CDP. The City had itself previously concluded that Windemere was not a historic resource, declared the structure to be a public nuisance, and authorized the Bottinis to demolish the cottage. Nevertheless, the City Council retroactively declared the cottage “historic,” concluded that the demolition should be considered part of the new home project, and found that there was a reasonable possibility that CEQA’s “historical resources” and “unusual circumstances” exceptions precluded use of the categorical exemption.

The Bottinis sued, contending that the City’s baseline determination violated CEQA and the City’s decisions regarding the historic status of Windemere and the extent of the required environmental review violated the Bottinis’ due process rights and resulted in a regulatory taking of their property.
Continue Reading CEQA Project Baseline Should Not Have Been Set Prior to Demolition of Historic Structure

A court of appeal has rejected CEQA and public trust challenges to a State Lands Commission lease extension allowing the Diablo Canyon nuclear power plant to continue operating through 2025.  World Business Academy v. California State Lands Commission, 24 Cal. App. 4th 476 (2018).

Pacific Gas & Electric Company plans to cease operating Diablo Canyon in 2025, when the plant’s federal licenses will expire.  The plant’s cooling water intake and discharge structures are on state-owned submerged and tidal lands, for which the Commission had issued leases to PG&E expiring in 2018 and 2019.  The Commission granted PG&E a consolidated lease extension through 2025, relying on CEQA’s categorical exemption for continued operation of existing facilities.

CEQA’s categorical exemptions are subject to several exceptions that can force a lead agency to prepare a negative declaration or an environmental impact report.  The “unusual circumstances” exception applies “where there is a reasonable possibility that the activity will have a significant effect on the environment due to unusual circumstances.”  Here, Diablo Canyon opponents argued that continued operation of the state’s last nuclear power plant was rife with unusual circumstances that could cause significant environmental effects.

To show that the unusual circumstances exception applies, normally a challenger must show both:  1) unusual circumstances; and 2) a reasonable possibility of a significant environmental effect due to those unusual circumstances.  Here, the Commission had made no finding regarding unusual circumstances.  With no finding before it, the court of appeal elected to assume unusual circumstances did exist, and then proceeded to the second half of the test:  whether there was a fair argument that the lease extension would cause significant environmental impacts.
Continue Reading Seven-Year Extension of Diablo Canyon Lease Held Exempt from CEQA

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

Background

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

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

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

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

The Court began by examining the text of section 15300.2, which provides: “A categorical exemption shall not be used for an activity where there is a reasonable possibility that the activity will have a significant effect on the environment due to unusual circumstances.” According to the Court, the plain language of this provision supported the view that there must be some showing of unusual circumstances for this exception to apply. The court of appeal’s interpretation would, the Court found, render the phrase “due to unusual circumstances” mere surplusage.

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

After obtaining the necessary permit, T-Mobile installed wireless equipment on an existing utility pole in a residential neighborhood in San Francisco.  The installation was part of a larger project to install similar equipment on existing utility poles scattered throughout the city.  Residents living nearby sought to have the city’s decision to issue the permit overturned,

The California Supreme Court has issued a landmark decision holding that the exhaustion doctrine – which requires parties to raise their claims at the administrative level before litigating them in court — applies to challenges to an agency decision that a project is exempt from CEQA.  Overturning a 15-year-old precedent, the court ruled that if the decision-making agency holds a hearing on the project, prospective litigants must apprise the agency of the relevant issues before they can bring them to court.  Tomlinson v. County of Alameda, Case No. S188161, 2012 WL 2145906 (Cal. June 14, 2012)

The issue exhaustion rule has been murky ever since a 1997 case, Azusa Land Reclamation Co. v. Main San Gabriel Basin Watermaster, 52 Cal. App. 4th 1165, stated that the exhaustion requirement did not apply to a challenge to a decision that a project was exempt from CEQA.  More recently, there have been conflicting opinions—the court of appeal’s decision this case, which sided with Azusa, and a two-year-old decision holding that exhaustion was required (Hines v. California Coastal Com., 186 Cal. App. 4th 830 (2010)).

The Supreme Court made the issue seem easy.  The court explained that CEQA expressly states that a proposed project can be challenged only on grounds that “were presented to the public agency orally or in writing by any person during the public comment period . . . or prior to the close of the public hearing on the project before the issuance of the notice of determination.”  (Pub. Res. Code 21177(a))  The court acknowledged that when an agency determines a project is exempt from CEQA, there is no public comment period, so that aspect of this test does not apply.  But if the public agency holds a hearing on the project before deciding it is exempt from CEQA, the court ruled the statutory requirement applies.  It does not matter whether the hearing was required by law.  Nor does it matter whether the agency ultimately filed a notice of determination.
Continue Reading Speak Now or Forever Hold Your Peace — Issue Exhaustion Applies to CEQA Exemptions.

In what is perhaps the most controversial CEQA decision this year, the court of appeal in Berkeley Hillside Preservation invalidated permits for construction of a single-family home, ruling that the project did not qualify under CEQA’s categorical exemption for construction of a single-family residence or its categorical exemption for infill development.  The California Supreme Court

 

The California Supreme Court has held that simple common sense — “an important consideration at all levels of CEQA review” — indicated that the City of Manhattan Beach and its retail sector were too small for the City’s ban on plastic bags to cause any significant environmental impact or make any significant cumulative contribution to