In Banning Ranch Conservancy v. City of Newport Beach, (2017) 2 Cal.5th 918, the California Supreme Court unanimously held that the City’s EIR prepared for the Newport Banning Ranch (NBR) project was inadequate, finding that it failed to identify potential “environmentally sensitive habit areas” (ESHAs) under the California Coastal Act (“Act”) and analyze the project’s impacts to those areas.
The Banning Ranch site is an undeveloped, 400-acre plot of land containing oil field facilities and wildlife habitat. The project site, located in the City’s “sphere of influence,” falls in the “coastal zone” under the Act. NBR proposed to develop the site with up to 1,375 residential units, 75,000 square feet of retail, and 75 hotel rooms.
After the City announced in its notice of preparation that the project site included areas that might be defined as ESHAs, numerous public comments were submitted urging the City to discuss potential ESHAs in the EIR. The City refused to do so, contending that it had no legal authority to determine if the areas were ESHA, despite the fact that it knew that the California Coastal Commission (“Commission”) staff had preliminarily determined that the project site contained ESHAs.
In July 2012, the City certified the FEIR and approved the NBR project master plan. Subsequently, Banning Ranch Conservancy (BRC) challenged the project approval, raising two issues. First, BRC claimed that the EIR failed to identify areas that might qualify as ESHAs and account for those areas in its analysis of project alternatives and mitigation measures. Second, BRC contended that the City violated its obligation under the general plan to work with the Commission to identify wetlands and habitats to be protected from development.
The trial court rejected BRC’s CEQA claim, but found that the City had not complied with their general plan obligations. The Fourth Appellate District affirmed on the CEQA issue, but reversed on the trial court’s general plan findings because the general plan did not require the City to work with the Commission before project approval.
Reversing the Fourth Appellate District’s holding related to BRC’s CEQA claim, the Supreme Court held that CEQA requires an EIR to identify areas that might qualify as ESHAs. Further, rejecting the City’s argument that CEQA imposes no duty to consider the Act’s ESHA requirements, the Court noted that the lead agency should integrate CEQA review with its project approval process. In addition, the Court held that an EIR must lay out any competing views put forward by the lead agency and other interested agencies. Finally, the Court held that it did not need to address the general plan issue because BRC was found to be entitled to relief on its CEQA claims.
The lead agency must identify a potential ESHA through consultation and discuss their ramifications for mitigation measures and project alternatives in the EIR when there is credible evidence that an ESHA might be present on the project site. The Court provided that whether an EIR has omitted “essential information” is a procedural question subject to de novo review, without clarifying exactly what is deemed “essential information” required to be analyzed under CEQA. Thus, the Court’s holding in this case raises a question of whether an EIR must address other similar statutory schemes relevant to the project, such as the California Fish and Game Code, the California and federal Endangered Species Acts, the federal Clean Water Act, and other statutory requirements administered by the responsible, trustee, or interested agency.