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Second Appellate District Upholds PG&E Lease Extension as Categorically Exempt from CEQA, Finds Unusual Circumstance Exception Inapplicable to Extension of Nuclear Power Plant Lease

Tuesday, June 19th, 2018

Ocean intake water flow can be seen at the Diablo Canyon Power Plant. (PG&E)

The Second Appellate District, in World Business Academy v. California State Lands Commission (2018) 24 Cal. App. 5th 476, determined that extending a power plant’s lease constituted a categorically exempt project under CEQA and the record was not sufficient to support an “unusual circumstances” exception to the exemption.

Diablo Canyon Power Plant is a nuclear power plant set to close in 2024 and 2025 owned and operated by PG&E in San Luis Obispo County. The plant’s cooling system draws in seawater plus incidental aquatic plants and animals from state-owned tidal and submerged lands then expels heated water back into the sea. The leases for this system were to expire in 2018 and 2019, five years before the plant closes.

PG&E submitted a single lease renewal application to the California State Lands Commission (Commission) to replace the expiring leases. A staff report confirmed the project would not require additional environmental review under the existing facility exemption unless it was found to be an unusual circumstance, an exception to exemption. After weighing the potential seismic and environmental impacts, Commission found that the state-land lease renewal would not have a significant effect on the environment due to unusual circumstances, moved to support the staff report, and issued a notice of exemption for the lease renewal.

Plaintiffs, World Business Academy, filed suit in Los Angeles County Superior Court alleging Commission’s actions violated CEQA and the public trust doctrine where the lease approval would irreparably injure and deplete the marine ecosystem surrounding the plant. The trial court held the lease replacement was within the existing facilities exemption to CEQA and the unusual circumstances exception did not apply.

Reviewing de novo, the Second District Court of Appeal agreed with the trial court, affirming Commission’s lease approval under the existing facility exemption. Further, there was no merit to arguments for an unusual circumstance exception to the CEQA exemption nor was there a violation of the public trust doctrine.

The Court determined the power plant was exempt from CEQA review as an existing facility. Appellants argued unlike other existing utility structures, nuclear power plants cannot be categorically exempt from CEQA because of the significant environmental impacts they have by their de facto operation. Further, the legislative history of the exemption indicated the meaning of “provide electric power” implicated structures which disseminate power, not power generating facilities themselves. The Court disagreed, under the plain meaning of the statute “provide” reasonably included a power plant.

The Court rejected a related argument that Commission lacked the authority to include nuclear power plants under the exemption due to their operational environmental impacts. The Court found minor alterations to, continued operation of, and leasing pre-CEQA facilities resulting in negligible or no expansion of use are unlikely to cause a significant adverse change in environmental conditions. Further, the class of projects at issue in the existing facilities exemption are not only nuclear power plants—rather, the exemption is applied to existing facilities of all types. The Court concluded that the Commission’s evaluation of the lease extension, while brief, was sufficient to demonstrate that the lease extension would maintain the status quo at the existing facility, not expand its operations.

The Court then looked to the unusual circumstances exception. Although Commission applied a procedurally lacking standard in showing that the project did not meet the exception, this was not fatal to their determination. Commission relied on a fair argument standard to assess if there was a reasonable possibility of a significant environmental effect of extending the lease, without first concluding that the project presented an unusual circumstance. The Court relied on North Coast Rivers Alliance v. Westlands Water District (2014) 227 Cal. App. 4th 832, to find even if the lease approval presented an unusual circumstance, Commission properly applied the fair argument standard in considering the possible effect on the environment.

Turning to the substantive portion of the unusual circumstance analysis, the Court found the project did not have a potentially significant environmental effect based on its size and location. Commission acted properly by considering the baseline for the site its pre-CEQA operational levels. Appellants failed to point to specific evidence supporting the claim that aquatic life would be significantly decreased past the initial operational level of the plant or certain risks – seismic activity, terrorist threats, “embrittleing” and others—would occur. Appellants’ claim that the plant constituted a significant environmental effect because it was the last one of its kind in the state was irrelevant, and dismissed appellant’s ad hominem attack against PG&E which alleged criminal conduct outside of the included record.

Finally, the Court held Commission’s staff report explicitly analyzed the public trust doctrine and the plant’s shutdown in 2024 and 2025 would adequately regulate the impacts to marine life associated with the cooling system. The Court concluded the Commission’s factual inquiry was sufficient, and that appellant’s contentions that the doctrine required factual evaluation vis-a-vie a CEQA analysis lacked merit.

Accordingly, the Court affirmed the judgement of the trial court.

Key Point:

The existing facilities exemption allows pre-CEQA power plants (regardless of power source) undergoing non-significant changes to avoid additional environmental review. The proper baseline to determine if a change is significant is not established by present-day or forecasted analysis, rather, by the environmental impact the facility had when it began operations.

Second Appellate District Calls Settlement Agreement Part of “Project” for CEQA Consideration In Line with Historically Broad “Project” Definition

Thursday, June 14th, 2018

Land erosion is visible under steps to Malibu’s Broad Beach. (Melanie Wynne)

In County of Ventura v. City of Moorpark (2018) 24 Cal. App. 5th 377, the Second Appellate District upheld a CEQA exemption applied to a project undertaken by the state-created Broad Beach Geologic Hazard Abatement District (BBGHAD). Notably, the Court held that the “project” for CEQA consideration, as approved by the California Coastal Commission and State Lands Commission, included both plans to restore the beach and a settlement agreement detailing project truck’s traffic restrictions. The Court held that the settlement agreement restrictions were not preempted by state law, and do not constitute an attempted extraterritorial regulation. However, the abdication of BBGHAD’s police power in portions of the agreement was improper therefore voiding that part of the agreement.

The state created BBGHAD to address beach and sand dune erosion at Malibu’s Broad Beach. Here, BBGHAD was to restore and restock sand at the beach. The project would involve shipments of 300,000 cubic yards of sand, four subsequent deposits of equal size at five year intervals, and additional shipments of 75,000 cubic yards on an as-needed basis. The sand was to be collected from quarries 30-40 miles away from Broad Beach and transported by trucks to the beach. The initial deposit alone was estimated to require 44,000 one-way truck trips. Possible truck routes from the quarries to the beach either required traveling through the City of Moorpark or on roads adjacent to the community. In the project’s planning stages, Moorpark officials expressed concern that hauling sand on these routes would negatively impact residents, and eventually created a settlement agreement with BBGHAD. BBGHAD agreed to specific haul routes, truck staging requirements, changes in route in response to settlement-defined road emergencies, and made concessions to only change the tenants of the agreement upon mutual assent. Thereafter, the Coastal Commission approved a coastal development permit for the beach restoration project, including the incorporated settlement agreement. The County of Ventura challenged the project in a petition for writ of mandate, alleging that the settlement’s incorporation is preempted by state law, constitutes an illegal attempt by Moorpark to regulate traffic outside of their city’s limits, and represents an abdication of BBGHAD’s state-granted police power.

The trial court found that the project was statutorily exempt from CEQA, held that the settlement agreement was not preempted by the state’s Vehicle Code, and found that the settlement was not an improper attempt by Moorpark to regulate traffic outside city limits. The trial court found that BBGHAD improperly contracted away its ability to break the settlement, struck the settlement’s mutual assent provision, and held that BBGHAD must be able to modify the agreement in response to changed circumstances.

The Second Appellate District affirmed the trial court’s ruling. On appeal, in addition to its original claims, Ventura contended that the settlement agreement is an action distinct from the Broad Beach restoration project, thus beyond the protection of the exemption and subject to CEQA review. The Court disagreed, and found that the settlement agreement between Moorpark and BBGHAD was part of the whole beach restoration effort. The Court stated that when two activities are a coordinated endeavor to obtain an objective or are otherwise related to each other, they constitute a single project for purposes of CEQA. Only when the second activity is independent of and not a contemplated future part of the first activity may the two activities may be reviewed separately.

Turning to the preemption argument, the Court found Vehicle Code section 21 was not implicated in Moorpark’s settlement agreement. Vehicle Code section 21 prohibits local authorities from enacting resolutions or ordinances which affect state traffic restrictions. The Court found that because the agreement did not involve an ordinance or resolution (rather, it was the City acting under its contracting power), it was not preempted by Vehicle Code section 21. The Court further found that the agreement merely dictated the routes BBGHAD’s contractors and subcontractors must use when delivering on behalf of the project because it did not amount to a physical barrier which would redirect traffic, did not close roads, and did not restrict non-project related hauling.

The Court then addressed the extraterritorial regulation contentions. Moorpark was within its contracting rights to further its implied necessity function of preventing public nuisances on their roads vis-a-vie the thousands of sand shipments. Additionally, the Court found the traffic restrictions on BBGHAD shipments were valid, as they only affected activity within the city limits.

Turning to the issue of infringements on BBGHAD’s police power, the Court found that as an entity of the state, BBGHAD was entitled to exercise a portion of the state’s police power. However, BBGHAD erred in part of the settlement agreement by contracting away its right to exercise its police power in the future. The agreement, in part, bound BBGHAD to surrender its discretion to haul routes in the future unless mutual assent was achieved between BBGHAD and the City. The Court found that this grant of veto power infringed upon the state’s police power therefore was invalid. In examining if this error was sufficient to render the entire agreement void, the Court weighed the agreement’s impact on the public and the expressed intentions of the parties, and determined that the aspects of the agreement which infringed on BBGHAD’s state-granted police power were severable from the rest of the agreement. Accordingly, the Court upheld the agreement in part and struck the agreement in part.

Key Point:

While incorporated settlement agreements with local authorities in project planning is allowable as part of one CEQA-defined “project”, when contracting with state entities, it is important to not infringe upon state police powers through the creation of modification clauses requiring assent from all parties.

First Appellate District Denies Initial Study Noise Level Challenge to Transitional Housing Project Based on Non-Expert Analysis

Monday, June 4th, 2018

Construction crews begin the building transformation from hospital to youth center. (Bruce Robinson, KRCB)

In Jensen v. City of Santa Rosa (2018) 23 Cal. App. 5th 877, the First Appellate District struck down a writ challenging repurposing of a hospital into a youth center and transitional housing. The Court ruled against claims the project traffic noise and recreational activities would constitute a source of noise significant enough to warrant the creation of an EIR where the two unrelated noise studies appellant relied on lacked merit. These reports constituted non-expert analysis and any conjectures from them were improperly supported. For these reasons, there was no substantial evidence supporting a fair argument there would be a significant noise impact meriting preparation of an EIR.

The project at issue, the Dream Center, was intended to repurpose a defunct hospital and create housing for 18-24 year old runaways, homeless youth, and former foster youth as well as those who have been abused, are unable to afford housing, or are unable to find employment.

Project leaders filed applications for a CUP, rezoning, and design review to implement plans for the Center. The City of Santa Rosa prepared a draft Initial Study/Negative Declaration. When creating the Dream Center’s Initial Study/Negative Declaration, project planners contracted with Fred Svinth of Illingworth & Rodkin to conduct a noise analysis of the site. Svinth’s study concluded, after taking independent measurements, that the project would not constitute a significant noise impact. The Santa Rosa Planning Commission reviewed the application and Svinth study and found the project would have no significant effect on the environment. The Council unanimously passed resolutions adopting and approving the project.

Thereafter, neighbors of the project (Petitioners) appealed the Commission’s approval to the Santa Rosa City Council, alleging that the project required an EIR because there would be potentially significant operational noise from the south staff parking lot and recreational activity space with a half basketball court, community garden, and pottery throwing space. However, per project plans and conditions for approval, Dream Center residents and delivery-persons were limited to use the main northern parking lot and recreation hours, specifically use of the basketball court, were limited. Petitioner’s challenge relied on a separate noise study performed by Svinth at a nearby convenience store to bolster their claim the project would constitute a significant noise impact.

City Council unanimously denied the appeal then approved the project. In response, Petitioners filed a writ of administrative mandate in the Sonoma County Superior Court, which was heard and denied. Petitioners appealed and the First District Court of Appeal upheld the denial of the writ and struck down the comparison of the Initial Study’s analysis to the separate Svinth study.

Petitioners urged the First Appellate District to adopt and apply the unrelated Svinth study’s methodology and specific noise values to the Dream Center site. Petitioners claimed that if the methodology and specific noise values from the unrelated Svinth study were applied to the Dream Center site, the project would have noise impacts significant enough to warrant the creation of an EIR. Petitioners conducted a non-expert qualitative analysis of the convenience store and Dream Center Svinth studies and concluded the “alternative” levels recorded at the convenience store were an acceptable means of analyzing noise impacts.

The Court struck down this comparison, stating Petitioner’s calculations were essentially opinions rendered by non-experts, and therefore could not be used. In addressing the parking lot claim, the Court stated Petitioner’s arguments rested on supposition and hypothesis, rather than fact, expert opinion, or reasonable inference. The Court clarified the noise impacts could not be reasonably shown to be significant because parking in the northern lot was more than adequate to accommodate use of the site and residents would not be allowed to park in the southern lot. In addressing the recreational use noise claim, the Court reiterated Petitioner’s calculations lacked scientific credibility, and upheld the independent noise study Svinth provided for the site.

Key Point:

When attempting to rebut the validity of an independent noise analysis for a project’s Initial Study, is it imperative to use expert analysis. Additionally, comparison of two unrelated Initial Study results (even if the sites are nearby) will likely fall short of Court-accepted scientific evidence.

Second District Court of Appeal Upholds Conservation Alternatives, Even in Absence of Additional Conceptual Designs; Defers to Lead Agency in Presence of Substantial Evidence

Thursday, February 8th, 2018

The building at the center of the litigation, 9080 Santa Monica Boulevard (Hunter Kerhart Photography/LA Weekly)

Rendering of the proposed Melrose Triangle Gateway building, which was proposed to replace the historic building (Architect Studio One Eleven/WEHOville)

In L.A. Conservancy v. City of W. Hollywood (2017) 18 Cal. App. 5th 1031, the Second District Court of Appeal affirmed the trial court’s decision upholding the adequacy of the environmental impact report (EIR) and supporting CEQA findings made by the City of West Hollywood (City) concerning approval of a mixed-use project on a three-acre “gateway” site in the City.

The Project, as proposed, required demolition of a building built in 1928 and remodeled in 1938, which was considered eligible for listing on the California Register of Historical Resources. The EIR acknowledged that demolition of the building constituted a significant and unavoidable impact.  As a result, the EIR included a project alternative that proposed redesigning the Project in order to preserve the historic building.  In approving the Project, the City rejected the preservation alternative, but required that portions of the historic building façade be incorporated into the Project design.

Plaintiff Los Angeles Conservancy (plaintiff) alleged that the City violated CEQA because the analysis of the preservation alternative was inadequate, the Final EIR failed to sufficiently respond to comments concerning preservation of the historic building, and evidence did not support the City’s findings that the preservation alternative was infeasible. The trial court denied the plaintiff’s petition. On appeal, the court affirmed.

First, the court held that the EIR’s analysis of the conservation alternative was detailed enough to permit informed decision making and public participation. The court rejected plaintiff’s argument that the City was required to prepare a “conceptual design” for the alternative.  The court noted that no legal authority required a conceptual design to be prepared for an alternative included in an EIR.

Second, the court found that comments on the draft EIR cited by the plaintiff did not raise new issues or disclose any analytical gap in the EIR’s analysis. The court noted that to respond to comments that merely expressed general Project objections and support for the preservation alternative, the City could properly refer the commenters back to discussion included in the draft EIR concerning the historic building on the project site.

Finally, the court stated that a court must uphold the lead agency’s findings concluding an alternative is infeasible if supported by substantial evidence. In undertaking this inquiry, “[a]n agency’s finding of infeasibility… is ‘entitled to great deference’ and ‘presumed correct.’” While the court noted that the plaintiff may have demonstrated that the City could have concluded the preservation alternative was not infeasible, other evidence in the record supported the City’s determination that the alternative was impractical or undesirable from a policy standpoint.  Thus, substantial evidence supported the City’s infeasibility findings.

Key Point:

Environmental project review documents providing detailed conservation alternatives to demolishing existing sites eligible for California Register of Historical Resources designation need not include additional conceptual designs to support these alternatives. Additionally, courts must uphold a lead agency’s finding concluding that an alternative is infeasible if supported by substantial evidence.

Second District Court of Appeal Upholds Decertification of Portion of Contested EIR on Remand

Thursday, February 8th, 2018

Construction of the Newhall Ranch Project, a 21,500-home development currently under construction along the Highway 126 freeway in north Los Angeles County.(Courtesy of Austin Dave, The Signal)

In Center for Biological Diversity v. California Dept. of Fish & Wildlife (2017) 17 Cal. App. 5th 1245, the Second District Court of Appeal addressed a challenge to the postremand judgment involving the Newhall Ranch Project issued by the trial court in response to Center for Biological Diversity v. Department of Fish & Wildlife (2015) 62 Cal.4th 204 and Center for Biological Diversity v. Department of Fish and Wildlife (2016) 1 Cal.App.5th 452.  Following the terms of the remand, the trial court entered judgment in favor of the plaintiffs on two issues: the analysis of greenhouse gas emission and stickleback impacts. Judgment was rendered in favor of the California Department of Fish & Wildlife (department) and the developer as to all other issues.

The judgment further ordered that a peremptory writ of mandate be issued directing the department to decertify the portions of the EIR that address the significance of the project’s greenhouse gas emissions, and the validity of the stickleback mitigation measures. The judgment stated: “Consistent with the Supreme Court’s opinion, all remaining portions of the EIR comply with CEQA.” Accordingly, the writ directed the department to void certification of portions of the EIR that address the department’s determination regarding the significance of the project’s greenhouse gas emissions and the stickleback mitigation measures.

The judgment and writ also enjoined all project activity including construction until the EIR was compliant with law. Further, the department also was ordered to “suspend” two project approvals that related directly to the EIR’s determinations regarding the significance of the project’s greenhouse gas emissions and stickleback mitigation measures, but four other approvals were left in place because no action was needed as to them “unless compliance with the Writ changes or affects” them.

Plaintiffs appealed from the trial court’s judgment on remand, arguing that the trial court’s decision to decertify only a portion of the EIR and leave some of the project approvals in place violated CEQA. The court rejected plaintiffs’ challenges to the postremand judgment.

First, the court explained that Public Resources Code section 21168.9, subdivision (a) clearly allows a court to order partial decertification of an EIR following a trial, hearing, or remand. The section applies when a court finds that “any determination, finding, or decision of a public agency” is noncompliant. (Pub. Resources Code § 21168.9, subd. (a).) After making such a finding, “the court must enter an order, in the form of a peremptory writ of mandate, containing one or more of three specified mandates. (Pub. Resources Code § 21168.9, subds. (a) & (b).) One of those three mandates is voiding the agency determination “in whole or in part.” (Pub. Resources Code § 21168.9, subd. (a)(1).) When a court voids an agency determination “in part,” it must make severance findings pursuant to Public Resources Code section 21168.9, subdivision (b), to determine whether the voided portions are severable, and whether the remainder will be in full compliance with CEQA. In reaching its holding, the court distinguished LandValue 77, LLC v. Board of Trustees of California State University (2011) 193 Cal.App.4th 675 and Bakersfield Citizens for Local Control v. City of Bakersfield (2004) 124 Cal.App.4th 1184 on the basis that in those cases the courts did not make the severance findings required under Public Resources Code section 21168.9, subdivision (b).

Second, the court rejected plaintiffs’ argument that it was improper for the trial court to leave some project approvals in place. The court explained that under Public Resources Code section 21168.9, subdivision (b), the court is required to order “only those mandates which are necessary to achieve compliance with this division and only those specific project activities in noncompliance with this division.” Thus, if the court finds that it will not prejudice full compliance with CEQA to leave some project approvals in place, it must leave them unaffected.

Finally, the court reviewed the severability findings made by the trial court to confirm whether the court properly exercised its authority. Applying the abuse of discretion standard, the court concluded the trail court’s severability findings satisfied Public Resources Code section 21168.9, subdivision (b).


Key Point:

When examining inadequate portions of an EIR, Public Resources Code section 21168.9, subdivision (b) allows courts to determine whether the inadequate and voidable portions are severable, and whether the remainder will be in full compliance with CEQA.

Fourth District Court of Appeal Rejects Finding of Mootness in Remand Proceedings for SANDAG’s 2050 RTP/SCS, Reverses in Part and Remands to the Superior Court

Thursday, February 8th, 2018

Cleveland National Forest, east of San Diego (Photo By Alexander S. Kunz, courtesy of the USDA)

Following Cleveland National Forest Foundation v. San Diego Association of Governments (2017) 3 Cal.5th 497 (“Cleveland II”), in which the Supreme Court reversed the Fourth District Court of Appeal’s decision (“Cleveland I”) (for an in-depth discussion of that decision, see our previous coverage of the case) and held that the EIR prepared for the San Diego Association of Governments’ (“SANDAG”) 2050 Regional Transportation Plan/Sustainable Communities Strategy (“Plan”) did not need to include an analysis of the Plan’s consistency with greenhouse gas (“GHG”) emission reduction goals of 80 percent below 1990 levels by 2050 (established by Executive Order (“EO”) No. S-3-05) to comply with CEQA, with respect to the other alleged deficiencies in the EIR, the Supreme Court “express[ed] no view on how, if at all, [its] opinion affect[ed] their disposition.”

The matter returned on remand to the Fourth Appellate District in Cleveland National Forest Foundation v. San Diego Association of Governments (2017) 17 Cal.App 5th 413 (“Cleveland III”). There, the Court rejected SANDAG’s argument that this case was moot because the Plan and the EIR had been superseded by SANDAG’s 2015 Plan and a 2015 EIR prepared for the 2015 Plan, respectively. The court explained that because the EIR might still be relied upon by project applicants the EIR was not superseded by the subsequent 2015 Plan EIR. Accordingly, the Court of Appeal reissued its opinion addressing the issues not reviewed by the Supreme Court. The court also republished its opinion, noting that automatic depublication upon grant of review is no longer required by the California Rules of Court (as it was when the Supreme Court originally took this case).

Because the matter was not moot, the court held that the EIR failed to address mitigation for the Plan’s GHG impacts. Finding that the EIR considered three measures that would result in little to no concrete steps toward emissions reduction and three onerous or unrealistic measures, the court concluded that it lacked the information required under CEQA – a discussion of mitigation measures that could both substantially lessen the Plan’s significant GHG impacts and be implemented in a feasible manner.

Lastly, the court exercised its discretion to consider other challenges to the EIR raised through the plaintiff’s cross-appeals. SANDAG argued that the plaintiffs forfeited these challenges by failing to obtain rulings on them from the trial court. The court explained that the forfeiture rule is not automatic and the court may exercise its discretion to excuse any forfeiture when it finds the issues sufficiently important.

Turning to these challenges to the EIR, the court held that: (1) the EIR failed to adequately discuss project alternatives because none of the project alternatives focused on significantly reducing vehicle miles traveled (“VMT”), finding that SANDAG’s own Climate Action Strategy stated that achieving the state’s GHG reduction goals would require significant reductions in VMT; (2) the EIR failed to provide adequate baseline information about exposures to toxic air contaminants and the location of sensitive receptors; (3) the EIR failed to correlate the Plan-related emissions to resulting adverse health impacts; (4) the EIR impermissibly deferred the analysis of air quality mitigation measures; (5) the EIR impermissibly understated the Plan’s growth-induced impacts on agricultural lands by failing to account for impacts to farmland of less than 10 acres put into production within the last 20 years; and (6) the plaintiffs failed to exhaust their administrative remedies as to their concerns about the Plan’s impacts to small firms and lands redesignated rural residential.

In dissent, Justice Benke argued that the majority erred in reissuing Cleveland I as modified (i.e., Cleveland III) because the case should have been remanded to the trial court for it to determine whether the case was moot as a result of SANDAG’s certification of the 2015 EIR for the 2015 Plan.

Key Point:

Liability may be imposed upon agencies for environmentally deficient programmatic EIRs, regardless of subsequent EIRs covering the same geographic area. When an EIR might still be relied upon by project applicants, it cannot be superseded by subsequent Plan EIRs, and challenges brought against the relied-upon EIR are not moot.

Bridges v. Mt. San Jacinto Community College District (2017) 14 Cal.App.5th 104

Thursday, February 8th, 2018

The Fourth District Court of Appeal affirmed the trial court and upheld Mt. San Jacinto Community College District’s (“College”) purchase agreement for approximately 80 acres of unimproved land in the City of Wildomar (“Property”), located about a mile southwest of Interstate 15.

Over the past 17 years, the College had considered building a new campus in southwest Riverside County to serve the growing communities along the Interstate 15 corridor. In the spring of 2003, the District entered into an option agreement to purchase the Property from the property owner, Riverside County Regional Park & Open-Space District (“District”). Subsequently, the College initiated CEQA review for the construction of a 488,000-square-foot campus intended to serve approximately 15,000 part-time and 10,000 full-time students on the Property. In May 2006, the College terminated CEQA review due to a lawsuit related to the option agreement.

On May 8, 2014, the College’s board of trustees held a public meeting to consider a motion to enter into an agreement to purchase the Property from the District for $2.455 million. In June 2014, the College and the District executed a purchase agreement for the Property, which conditioned both the opening and closing of escrow on CEQA compliance. Later, the voters approved a $295 million bond measure to upgrade and expand the College’s facilities, including the construction of facilities on the Property. The plaintiffs sued the College. The trial court held for the College.

On appeal, the court held plaintiffs were barred from raising their objection in a CEQA suit because they did not offer any comments during the meeting where the College’s board of trustees considered the purchase agreement for the Property, and therefore failed to exhaust their administrative remedies. The plaintiffs argued they were excused from the exhaustion requirement because the College did not give appropriate notice of the meeting. Finding that the May 8, 2014 meeting was a regularly scheduled meeting of the board of trustees, not a public hearing under CEQA, the court held that the College provided appropriate notice at least 72 hours in advance, as required by the Brown Act. With no evidence in the record showing that the College improperly noticed the meeting, the court held that under Evidence Code section 664, it must presume the College regularly performed its official duty, including providing proper meeting notice.

The court nonetheless addressed the merits of the plaintiff’s CEQA claims. First, the court rejected the plaintiff’s argument that the College must issue an EIR before it signed the purchase agreement. The court explained that CEQA Guidelines section 15004, subdivision (b)(2)(A) allowed the College to enter into the purchase agreement if it conditioned its future use of the site on CEQA compliance. The court also found that the purchase agreement did not commit the College to a definite use of the Property, unlike the circumstances in Save Tara v. City of West Hollywood (2008) 45 Cal.4th 116.

Second, the court found that the purchase agreement was not a project under CEQA, given that no development plans existed at the time the College executed the purchase agreement. Third, stating that it “bordered on the frivolous,” the court rejected plaintiff’s argument that the College was required to prepare an EIR under Public Resources Code section 21080.09, which requires a college to prepare an EIR when it selects a location for a campus and approves a long range development plan. The court reasoned that campus site selection involves more than the execution of the purchase agreement.

Aptos Council v. County of Santa Cruz (2017) 10 Cal.App.5th 266

Thursday, February 8th, 2018

The Sixth District Court of Appeal affirmed the trial court’s decision and upheld three ordinances amending the County’s zoning regulations in an effort to modernize its zoning regulations.

These ordinances were intended to: (1) extend minor exceptions to zoning site standards (the “minor exceptions ordinance”); (2) alter certain height, density, and parking requirements for hotels in commercial districts (the “hotel ordinance”), and (3) establish an administrative process for approving minor exceptions to the County’s sign ordinance (the “sign ordinance”). The County adopted an addendum to a previously adopted negative declaration for the minor exceptions ordinance, a negative declaration for the hotel ordinance, and statutory, categorical, and common sense exemptions for the sign ordinance.

Plaintiff Aptos Council filed a lawsuit alleging that Santa Cruz County’s approval of the ordinances violated CEQA because the zoning code approvals collectively constituted a single project requiring preparation of an environmental impact report.

On appeal, the court held that the County did not engage in improper piecemeal environmental review. The court found that the adoption of the three ordinances did not constitute a single project that must be evaluated in an EIR applying the two-prong test provided by the California Supreme Court in Laurel Heights Improvement Association v. Regents of University of California (1988) 47 Cal.3d 376. The test provides that an EIR must include an analysis of the environmental effects of future expansion or other action if: (1) it is a reasonably foreseeable consequence of the initial project; and (2) it will be significant in that it will likely change the scope or nature of the initial project or its environmental effects. The court explained that the County’s proposed changes in its zoning regulations, such as altering the density requirements for hotels and reducing the required number of parking spaces per hotel room, did not rely on the implementation of the other regulatory changes proposed by the County, such as eliminating the need to obtain a variance for certain signs. Thus, the court concluded that the first set of changes was not a reasonably foreseeable consequence of the other regulatory changes.

Finally, the court rejected Aptos Council’s argument that the negative declaration prepared for the hotel ordinance was inadequate because it failed to consider the impacts from future developments that would be encouraged by the hotel ordinance. Aptos Council argued that the County’s own stated reason for adopting this ordinance – to facilitate growth – meant that increased hotel developments were a reasonably foreseeable consequence of the ordinance. Rejecting this argument, the court found that future hotel developments were not required to be analyzed because Aptos Council was merely speculating about future development and thus failed to adequately identify substantial evidence in the record to support its fair argument claim.

Court Rejects CEQA Lawsuit Challenging Approval of Planned Parenthood Clinic Premised on Potential Secondary Environmental Impacts Associated with Clinic Protests

Wednesday, September 27th, 2017

In Respect Life S. San Francisco v. City of South San Francisco, 2017 Cal. App. LEXIS 801, the First Appellate District held that the City of South San Francisco’s approval of a conditional-use permit allowing an office building to be converted to a medical clinic did not violate requirements imposed by the California Environmental Quality Act (CEQA). The City determined that the project fell within several categorical exemptions to CEQA, and thus, the permit did not require further CEQA review.

The case arose after the owner of an office building in downtown South San Francisco applied for a conditional-use permit to allow the building to be used as a medical clinic for a new tenant, Planned Parenthood. The physical changes to conversion of the building for use as a medical clinic were minor, and the City’s Planning Commission approved the permit after holding a public hearing.

Petitioner Respect Life South San Francisco (Respect Life) disagreed with the Planning Commission’s determination that the project fell into categorical exemptions and appealed to the City Council. Specifically, Respect Life alleged that the City ignored the “inherently noxious and controversial nature” of Planned Parenthood’s services which would cause protests leading to “environmental impacts… including traffic, parking, [and] public health and safety concerns,” thus necessitating an Environmental Impact Report (EIR) under CEQA.

The City Council affirmed the Planning Commission’s determination that the permit was exempt from CEQA under three categorical exemptions applying to (1) the operation of existing facilities (CEQA Guidelines section 15301); (2) the conversion of small structures (CEQA Guidelines section 15303); and (3) the development of urban in-fill projects (CEQA Guidelines section 15332). Thereafter, Respect Life filed a petition for a writ of mandate. The trial court upheld the City’s finding that the Project was exempt from CEQA and denied the petition. Respect Life subsequently appealed to the First District.

On appeal, Respect Life acknowledged that the project fell within at least one of CEQA’s categorical exemptions, but contended a full environmental review was still necessary due to the unusual-circumstances exception to those categorical exemptions. The “unusual-circumstances exception” provides that “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 the unusual circumstances.”

The Court of Appeal first noted the different standards of review: first the party seeking to establish the unusual-circumstances exception must show “that the project has some feature that distinguishes it from others in the exempt class, such as its size or location,” and second, that there is “a reasonable possibility of a significant effect [on the environment] due to that unusual circumstance.” (Berkeley Hillside Preservation v. City of Berkeley (2015) 60 Cal.4th 1086.) The Court elaborated that a deferential standard applies in reviewing the first element, and a non-deferential standard applies in reviewing the second.

Because the City Council did not directly address whether the Project would result in any unusual-circumstances, the Court concluded that to affirm such an implied municipal determination, the court must assume that the entity found the project involved unusual circumstances, but then consider whether a fair argument exists that the project will have significant effect on the environment. The Court then held that Respect Life failed to identify substantial evidence of any potentially significant environmental impact.

In reaching this holding, the Court explained that a “significant effect on the environment means a substantial or potentially substantial, adverse change in the environment.” (§ 21068.) The Court was unpersuaded by Respect Life’s argument that “the notoriety of [Planned Parenthood] and its activities,” would cause significant environmental impacts such as sidewalk obstruction, public safety concerns, parking congestion, business disruption and increases in noise levels. They found that there was no substantial evidence presented to support a fair argument that there was a reasonable possibility that these impacts will have a significant environmental impact, and conversely found evidence in the record showing the opposite. As a result, the Court of Appeal upheld the trial court’s decision denying Respect Life’s petition.

Key Point:

While the City ultimately prevailed in this litigation, the decision serves as an important reminder regarding the value of a lead agency making express findings addressing the exceptions to the categorical exemptions.  If the City had expressly concluded that the Project did not involve any unusual circumstances, then the Court could have upheld the City’s determination based on the much more deferential “substantial evidence” standard of review and not been required to consider whether a “fair argument” of a potentially significant environmental impact existed.

Certified Regulatory Program’s Environmental Documents Must Comply with CEQA’s Policy Goals and Substantive Requirements

Monday, September 25th, 2017

In Pesticide Action Network North America v. California Department of Pesticide Regulation, 2017 Cal. App. LEXIS 803, the First Appellate District reversed the trial court and set aside the Department of Pesticide Regulation’s (“DPR”) approval of amended labels for two pesticides, Dinotefuran 20SG and Venom Insecticide.  The purpose of the amended labels was to allow both pesticides to be used on additional crops, such as fruiting vegetables, onions, peaches, and nectarines.

In 2006, a phenomenon called “colony collapse disorder” began, where many honey bees disappeared from managed hives in the United States. According to the 2012 Report on the National Stakeholders Conference on Honey Bee Health (“NSC Report”), approximately 28 to 33 percent of honeybee colonies had failed each year since 2006, while a normal loss rate was ten percent.  The NSC Report noted that colony collapse disorder was being caused by several factors, including pesticides.  In February 2009, the Department initiated a reevaluation of the two pesticides at issue in this case along with 280 other pesticide products.  In September 2014, the Department was granted by the California Legislature until July 1, 2018 to complete a thorough reevaluation of the pesticides on pollinator health.

In January 2014, before the Department completed the reevaluation, it released public reports concerning its proposed decisions to approve amended labels for Dinotefuran 20SG and Venom Insecticide. Subsequently, the Department approved the label amendments.  The plaintiff sued to set aside the Department’s approval, contending that the Department violated CEQA in approving the label amendments.  The trial court ruled in favor of the Department.

On appeal, the court rejected the Department’s argument that the environmental review was exempt from CEQA because it was conducted pursuant to the Department’s pesticide registration program certified under Public Resources Code (“PRC”) section 21080.5, which allowed the Department’s environmental documents to serve as the “functional equivalent” of CEQA documents. Based on the plain language of PRC section 21080.5 and case law, the court concluded that the Department’s registration program was subject to the broad policy goals and substantive requirements of CEQA while exempt from the CEQA procedural requirements set forth in CEQA Chapters 3 and 4 and PRC section 21167.

Next, the court identified the broad policy goals and substantive requirements of CEQA applicable to certified regulatory programs and found that the Department did not comply with these requirements. First, citing PRC section 21001(g), the court held that the Department must consider alternatives to registering the proposed new uses for the two pesticides.  Accordingly, the court found that the reports “glaringly” failed to address any feasible alternative.  Second, finding that the Department’s environmental documents must provide an adequate baseline, given the CEQA’s goal of informing the public of the potential impacts of a proposal, the court concluded that the Department failed to provide adequate baseline information.  Third, relying on case law, the court also found that the Department must consider the project’s cumulative impacts, but failed to so.  Finally, finding that the Department was required to recirculate any new significant information about the project, the court held that because the Department’s initial public reports were “so inadequate and conclusory … public comment on the draft was effectively meaningless” its effort to explain its decision in response to comments required recirculation.

Key Point:

While exempt from the CEQA procedural requirements set forth in CEQA Chapters 3 and 4 and PRC section 21167, environmental documents prepared under a certified regulatory program pursuant to PRC section 21080.5 must comply with the policy goals and substantive requirements of CEQA.