Mitigation Fee Programs Must Be Analyzed In An EIR Prior to Adoption

January 24th, 2012

By: Thomas Law Group



Center for Sierra Nevada Conservation et al. v. County of El Dorado (January 20, 2012) 202 Cal. App.4th 1156 (Superior Court Case No. PC20080336)

El Dorado County adopted an oak woodland management plan (Management Plan) and mitigation fee program (Fee Program) without first certifying an EIR.  Instead, the County issued a negative declaration that allegedly tiered from the County’s previously approved General Plan and Program EIR.  The General Plan and Program EIR allowed developers of more than 10 acres to conserve oak woodlands on site at a 1:1 ratio as a mitigation “Option A” and also considered mitigation under an “Option B”, which would allow developers to pay a mitigation fee under a yet-to-be-adopted oak woodland management plan instead of providing on-site mitigation.  Importantly, however, neither the General Plan nor the Program EIR specified the fee rate for Option B, or provided how the collected fees would actually be used to mitigate the impact to oak woodlands.

Petitioners challenged the County’s adoption of the Management Plan and Fee Program and related negative declaration.  The County argued that the Management Plan and Fee Program were within the scope of the General Pan and the impacts were adequately addressed in the General Plan Program EIR.  While the trial court agreed with the County, the Third District Court of Appeal did not.  Siding with petitioners, the court held that the County was required to prepare a tiered EIR before its adoption of the Management Plan and implementation of the Fee Program.  The court acknowledged that the Program EIR anticipated development of a Management Plan and Fee Program, however the prior EIR did not provide adequate environmental analysis to conclude the Management Plan and Fee Program would have no greater adverse environmental effects than analyzed and anticipated in the Program EIR.  Specifically, the Program EIR did not set the fee rate, define how the acreage subject to the fee should be measured (e.g., measuring tree canopy by tree canopy cover or by total area including the space between canopies), or explain how the off-site oak woodland losses would be mitigated by the fees.  Each of these factors is critical in determining whether the Management Plan and Fee Program provide effective litigation.

The County also argued that any EIR analysis for the Management Plan could be postponed until formulation of the Plan had been completed.  The court disagreed, noting that “approval” of a project under CEQA occurs when a public agency’s decision commits it to a definite course of action.  Here, the County’s approval of the Management Plan had the effect of allowing developers to pay a fee under the Option B Fee Program instead of preserving a substantial number of trees on-site under Option A.  Thus, consistent with longstanding case law, the County was required to conduct an EIR review before approving the Management Plan and Fee Program.

Lastly, the court agreed with Petitioners’ argument that the County violated CEQA by issuing a negative declaration because the administrative record supported a “fair argument” that the Management plan and Fee Program would have a potentially significant effect on the environment and thus an EIR was required to consider the effects on the environment.   While the County did not assert that the Management Plan and Fee Program would have no environmental impacts, as discussed above it argued that the Program EIR already took any significant adverse effects into account.  This argument was undermined by the project’s Initial Study and other evidence in the record acknowledging potentially significant effects on the environment.  The fact that the Program EIR contemplated adverse impacts from development under the General Plan does not remove the need for a tiered EIR for the Management Plan and Fee Program.  Indeed, the court noted that a Program EIR is distinct from a Project EIR which is prepared for a specific project and provides site-specific analysis.  In this case, the court held that the Management Plan and Fee Program constituted the specific project at issue and required a tiered EIR to examine its potential environmental impacts.

The court’s holding in this case is consistent with California Native Plant Society v. County of El Dorado (2009) 170 Cal.App.4th 1026, which held that an EIR was required to properly review a fee program.

Key Points:

An EIR must inform the formulation and approval of a mitigation fee program.  To avoid the need for a project level EIR for a mitigation fee program, a public agency proposing to adopt a land use plan could develop within that plan the specific terms of any contemplated fee programs and analyze potential environmental impacts of those fee programs.  This approach would allow the public agency to analyze the fee program within the EIR for the plan and avoid future environmental review.

This decision also adds to recent case law addressing the fair argument standard.  In light of recent decisions, we note that it is becoming nearly impossible for a negative declaration to withstand challenge if any evidence is produced regarding the potential for environmental impacts.

Written By: Tina Thomas and Ashle Crocker

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The information presented in this article should not be construed to be formal legal advice by Thomas Law Group, nor the formation of a lawyer/client relationship. Readers are encouraged to seek independent counsel for advice regarding their individual legal issues.