Tag: CEQA

Third District Upholds the Department of Water Resources’ Long-Term Extensions of State Water Project Contracts under CEQA, the Delta Reform Act, and the Public Trust Doctrine

General Posted by   

In Planning and Conservation League v. Department of Water Resources (Cal. Ct. App., Jan. 5, 2024, No. C096304), the Third District Court of Appeal upheld an EIR prepared by the Department of Water Resources (DWR) for DWR’s approval of amendments to long-term water supply contracts with local water agencies receiving State Water Project (SWP) water. These contract amendments extended the terms of the SWP water supply contracts to 2085 and expanded DWR’s ability to use revenue bonds. In a victory for DWR and the SWP water contractors, the court upheld DWR’s EIR against an array of CEQA challenges. The court also rejected the petitioners’ claims that the amendments violated other legal requirements, including the Delta Reform Act, the Public Trust Doctrine, and the Burns-Porter Act.

By way of background, in the 1960s, DWR and 29 local government contractors entered into long-term (75-year) contracts granting the contractors rights to a portion of water from the SWP in exchange for the local agencies’ financial obligations. Each contract includes a table, “Table A,” that specifies the maximum annual water allocation, although full delivery is not guaranteed and often amounts to about half the Table A amount.

The contracts include an “evergreen clause” that allows the contractors to opt for continued service beyond the contract’s expiration by giving advanced notice. Several contractors exercised this option, leading to negotiations for long-term extensions of the contracts. The negotiations aimed to address the “debt compression problem,” where the impending contract termination limited bond maturity to 17 years, increasing the repayment costs. DWR and the contractors reached an agreement in principle to extend the contracts to 2085, which would allow for longer-term bond funding for essential capital upgrades and repairs. They also agreed to a revenue bond amendment that updates the definition of water system facilities to include post-1987 repairs and approved capital projects.

DWR prepared an EIR for the proposed amendments. The EIR concluded that the amendments would not cause environmental impacts because they would not alter the existing authority to build or modify SWP facilities, change water allocations, or create new water management measures.

After certifying the EIR, DWR filed a validation action to validate the amendments. Thereafter, several conservation groups and public agencies brought legal challenges the EIR and the validation action. The trial court ruled in favor of DWR and the petitioners appealed.

CEQA

DWR properly assumed the existence of the current contracts in the EIR’s environmental baseline.

The petitioners argued that the EIR’s impact analysis was based on an improper baseline because the baseline included the current water contracts. The court explained that to determine whether a project’s environmental impacts are significant, the agency must compare the project against existing environmental conditions—the baseline. When a project involves ongoing activities or the extension of past activities, the current levels of use and their physical impacts are part of the baseline.

The court explained that this rule is applicable to renewing permits or approvals for existing facilities, even if those facilities had not been previously assessed under CEQA. Accordingly, the court held that DWR appropriately included the existing contract conditions in the environmental baseline. DWR was not required to use a hypothetical baseline “that imagines a world” without the contracts.

DWR did not improperly piecemeal the Project in excluding a Delta conveyance facility from the project definition.

The petitioners argued that the EIR’s analysis was inadequate because it failed to consider related projects – including a future Delta conveyance facility, such as the previously proposed “California WaterFix” project – as part of the proposal, leading to an overly narrow project description and improper piecemealing.

The court explained that CEQA requires an environmental analysis to consider the whole of an action affecting the environment. An agency may not divide a larger project into smaller segments, which might individually have minimal environmental impacts but could collectively result in significant environmental damage. Further, as held in Laurel Heights Improvement Assn. v. Regents of University of California (1988) 47 Cal.3d 376 (Laurel Heights I), an EIR must analyze the environmental effects of any future expansions or actions that are a foreseeable consequence of the initial project and might alter its scope or environmental effects.

The petitioners argued that the trial court relied too heavily on the Laurel Heights I criteria, asserting that a broader “related to” test should apply and that actions that are close in time and location must be considered part of a larger project. The court rejected the petitioners’ argument, explaining that later opinions have confined such reasonings to situations in which a project legally necessitates or assumes the completion of another action, a situation that was not present here.

The court next explained that the courts have interpreted Laurel Heights I variously, with some concluding that a project is part of a larger project under CEQA if it is a “crucial element” of a larger project, such as when one project cannot proceed without the other. Other courts have held that there may be piecemealing when the project at issue is a first step or a catalyst toward another project. On the other hand, there is no piecemealing when the projects can be implemented independently.

Here, DWR properly treated the contract amendments as a stand-alone project, distinct from a future Delta conveyance facility. The record demonstrated that the amendments have separate, independent purposes from a Delta conveyance, such as addressing the bond compression issue. While the amendments may possibly aid in financing a conveyance facility, they serve broader purposes and address other challenges. Moreover, the record showed that there is considerable uncertainty as to whether a Delta conveyance facility would ever be approved or constructed. In light of these factors, DWR was not required to treat a potential, uncertain Delta conveyance as part of the same project as the contract amendments.

DWR did not need to assess the direct, indirect, and cumulative effects of projects that would benefit from the amendments’ bond funding.

The petitioners argued that the EIR should have evaluated the direct and indirect impacts of enabling a Delta conveyance project. The court found that this argument suffered from the same flaws as the petitioners’ piecemealing argument: the possibility of a Delta conveyance in the future is too speculative in terms of both its timing and scale. Lead agencies are not required to speculate about potential impacts.

The petitioners also argued that DWR should have evaluated the impacts of other capital projects financed by the amendments, such as the Oroville hydroelectric license project. Petitioners, however, failed to properly present this argument by failing to discuss these other projects or explain why their effects should be considered impacts of the amendments. Moreover, the argument was baseless. The EIR clarified that the amendments would support a variety of long-term capital projects. According to the petitioners’ logic, DWR would be obligated to predict the impacts of all of these projects in the EIR for the amendments, an expectation that is unreasonable. Further, the court noted, projects that are merely governmental funding mechanisms or fiscal activities that do not commit to any specific project that could have environmental effects are not subject to CEQA. Although these capital projects may be part of DWR’s overall plans for the SWP, their connections to the amendments is too tenuous: the amendments do not commit DWR to these projects and do not authorize revenue bonds for any of them (which would require a separate approval).

The EIR’s project description complied with CEQA and was not misleading or inconsistent.

The petitioners asserted – and the court rejected – three arguments regarding the EIR’s project description. First, the petitioners argued that depicting the Delta conveyance facility as a separate project in the EIR conflicted with statements made in earlier environmental review documents. The petitioners cited various documents to support this assertion, but failed to explain how these documents substantiated their position. Moreover, the court’s examination of the cited documents did not reveal any inconsistencies.

Second, the petitioners argued that identifying the 2085 extension date in the EIR was misleading and inaccurate because the EIR did not reveal DWR’s expectation of successive contract extensions under the existing contracts’ evergreen clauses. But petitioners failed to support this argument with any analysis or authority. Furthermore, the record demonstrated that there are clear differences between applying the evergreen clause to individual contracts and achieving a long-term extension for all contractors.

Third, the petitioners argued that the EIR incorrectly stated that the amendments would not change the authority under the current contracts to construct new or modify existing facilities. They argued that the amendments would remove limitations on revenue bond eligibility for new facilities, potentially financing new or expanded facilities. The court rejected this argument as inconsistent with the EIR’s project description, which made these facts plain by explaining that the amendments would offer enhanced funding mechanism that could fund new or expanded facilities.

The petitioners failed to show that the EIR’s range of alternatives was unreasonable.

CEQA requires an EIR to identify and evaluate a reasonable range of alternatives that could achieve most of the project’s basic objectives while avoiding or significantly reducing its adverse environmental effects. DWR’s objectives for the amendments included financing the SWP past 2035, maintaining funding reserves, simplifying the billing process, and improving financial coordination between DWR and the contractors. In addition to a no-project alternative, the EIR analyzed seven alternatives, including different contract extension lengths with or without financial amendments, bond sales extending beyond the current contract expiration, and a scenario where not all contractors agreed to the amendments. Two additional alternatives were considered, but rejected from further consideration in the EIR: reducing the “Table A” amounts and implementing new water conservation provisions.

The petitioners argued that DWR’s selection of alternatives violated CEQA in three ways. First, in a single-sentence argument, the petitioners asserted that the alternatives were not sufficiently different to constitute a reasonable range. The court summarily rejected this argument because the petitioners failed to provide any authority or analysis to support it. It was incumbent on the petitioners to show that the range of alternatives were manifestly unreasonable or identify evidence of a least one potentially feasible alternative that would meet most of the basic objectives while reducing the project’s impacts. The petitioners’ one-sentence statement did not satisfy this burden.

Second, the petitioners argued that the revenue bond amendment creates financial risk and that the EIR should have analyzed an alternative that excludes that amendment. The court rejected this argument, explaining that CEQA is not a statute for economic protection, and economic impacts alone do not qualify as significant environmental impacts. Moreover, the no-project and the extension-only alternative evaluated in the EIR sufficiently covered the exclusion of the revenue bond amendment.

Third, the petitioners challenged DWR’s rejection of alternatives to reduce Table A amounts and to implement new water conservation measures, arguing that these alternatives would reduce environmental effects and would align with other state laws and policies. The court rejected this argument, explaining that agencies are not required to analyze alternatives that would solve broader problems or add complex issues that the agencies had chosen not to address. Here, DWR deliberately limited the EIR’s scope to financial issues related to the SWP contracts and made a reasoned decision to exclude Table A amounts from the project’s scope. DWR was not required to analyze alternatives that address bigger issues than the problems DRW is trying to address.

DWR properly defined the no-project alternative as the water contracts proceeding without the amendments, rather than termination of the contracts.

An EIR is required to evaluate a “no project” alternative; the purpose of this requirement is to compare the environmental impacts of not approving the project with those that would occur if the project is approved. Here, the EIR’s no-project alternative assumed that operations and financing of the SWP would continue under existing contracts until December 31, 2035, with contract terms potentially extended beyond this date through the evergreen clause. Under this scenario, water services would continue beyond 2035 in line current financial terms, no bonds would be sold with maturity dates past 2035, and the debt compression issue would worsen. The EIR concluded that this alternative, like the amendments, would not lead to direct physical environmental impacts because it would not introduce new water management measures, change DWR’s authority to build or modify facilities, or alter water allocation in the existing contracts.

The petitioners argued that DWR should have considered, as the no-project alternative, a scenario in which the contracts are allowed to expire. According to the petitioners, relying on the evergreen clause as part of the no-project alternative is inappropriate because: (i) application of the evergreen clause might itself be a project; (ii) the evergreen clause does not guarantee an extension of all contract provisions; and (iii) the evergreen clause does not account for other future changes to the SWP that DWR has acknowledged. The petitioners further asserted that DWR’s analysis blurred the distinction between the no-project scenario and the amendments, thereby failing to provide a clear and factual analysis of maintaining the status quo.

The court rejected these arguments. The court explained that the analysis of the no-project alternative must consider current conditions and what can reasonably be expected in the foreseeable future if the project is not approved. In reviewing a no-project alternative, the court’s focus narrowly on whether the EIR adequately describes existing condition and offers a plausible vision of the foreseeable future. Here, DWR’s no-project met these standards. Given the long history of the SWP and its critical role in supplying water to the state, as well as the long-term investments of the contractors in the SWP, DWR was not required to treat termination of the contracts as the no-project alternative.

Petitioners failed to demonstrate that recirculation of the EIR was required.

CEQA requires a lead agency to recirculate an EIR for further public review and comments when the agency introduces “significant new information” to the EIR before its certification. The court held that petitioners failed to meet that burden by failing to provide any facts or analysis of the information added to the EIR was “significant” within the meaning of CEQA.

The petitioners further claimed that recirculation was required because DWR added additional information regarding the rejected “Table A amount reduction” alternative in the final EIR. The court explained, however, that the added discussion was not “significant” because it did not reveal any new environmental impact or an increase in the severity of an impact, and did not deprive the public of a meaningful opportunity to comment on a substantial adverse effect or a feasible mitigation measure or alternative that the project’s proponents declined to implement. Rather, the additional information added to the final EIR served only to clarify and amplify the conclusions of the draft EIR, and therefore did not trigger recirculation.

Delta Reform Act

Under the Delta Reform Act, any state agency planning to undertake a “covered action” must first certify in writing that the action is consistent with the Delta Plan. This certification, including detailed findings, must be submitted to the Delta Stewardship Council before the covered action is implemented. (Water Code, § 85225.) A “covered action” is defined in Water Code section 85075.5 as a plan, program, or project that meets certain criteria and is not exempt.

Here, DWR determined that the amendments were not a covered action and therefore did not prepare a certification of consistency with the Delta Plan. The petitioners, in contrast, asserted that the amendments constituted a covered action. The court agreed with DWR that the amendments were not a covered action.

The court observed that, viewing the Delta Reform Act holistically, several points stand out. First, the Act primarily targets “future developments,” rather than existing ones. Second, a covered action is defined as an action occurring within the Delta or Suisun Marsh boundaries. Third, such actions must significantly impact California’s water supply reliability or the Delta ecosystem. Fourth, routine maintenance and operation of the SWP are not included as covered actions. While the court did not delve into the exact meaning of “routine maintenance and operation,” it found it fair to say that the existing SWP is generally exempt from being a covered action.

Applying these insights, the court held that the amendments do not qualify as a covered action. The amendments merely extend existing contracts with SWP contractors and enhance DWR’s ability to finance improvements and new facilities for the SWP using revenue bonds, subject to certain approvals. They do not physically take place in the Delta, nor do they modify the developed uses of the SWP. Therefore, the DWR’s decision not to prepare a certification of consistency with the Delta Plan was not erroneous.

Public Trust Doctrine

The petitioners argued that, under the California Supreme Court’s decision in National Audubon Society v. Superior Court (1983) 33 Cal.3d 419 (National Audubon), DWR had an affirmative duty to take the public trust into account in approving the amendments. The court disagreed, reasoning that a closer reading of National Audubon indicates that the high court was specifically concerned about the approval of water diversions. This distinction is significant because DWR does not approve water diversions—that task is performed by the State Water Resources Control Board.

Furthermore, the court found that the record supported DWR’s conclusion that the amendments do not impact a public trust resource. The water rights at issue were granted by the State Water Board in 1967 and have been amended by that board several times. The contracts giving the contractors interest in those water rights “were executed in the 1960s and allow the contractors to extend their interests indefinitely.” Under this framework, it was reasonable for DWR to conclude that extending the terms of the contracts to 2085 would not have impacts on resources held in the public trust.

The court also rejected the petitioners’ argument that, under National Audubon, DWR has a “‘continuing duty to supervise’” the taking and use of the appropriated water. The court explained that petitioners took the statements in National Audubon out of context in that, in National Audubon, no agency had ever considered the public trust in relation to the challenged water diversions and their harm to Mono Lake. The court in the present case declined to translate the “continuing duty of supervision” described in National Audubon as imposing a continued duty on DWR to supervise the water rights with which it operates the SWP. In this context, DWR’s duty under the public trust doctrine is only triggered when DWR is taking an action with an impact on public trust uses. Since there is no such impact here, the duties to weigh the public trust interests or consider additional protections do not apply.

Remaining Arguments Against Validation of the Amendments

Finally, the court rejected several other arguments raised by the petitioners challenging the amendments’ validation.

The Validation Action Was Not Premature

The petitioners argued that DWR’s validation action was premature. The Court of Appeal rejected this contention, explaining that the 60-day limitation period for bringing a validation action and the public policy of a speedy determination of a public agency’s action undermined the petitioners’ claim of prematurity. Furthermore, the petitioners failed to cite any authority to support the position that prematurity is a valid defense against a validation action.

The Amendments Are Consistent with the Burns-Porter Act

Under the Burns-Porter Act, any income from the sale, delivery, or use of SWP water or power must be placed into a special fund. This fund is then used for various purposes, following a strict order of priority established by the Act. The highest priority is for funding the annual maintenance and operation costs of the SWP, including replacing any parts of the SWP as needed. The petitioners argued that the amendments – specifically the extension amendment and the revenue bond amendment – were inconsistent with this first priority requirement. The court disagreed, finding that nothing in the amendments disrupts or contravenes the established priority order for the use of funds as set forth in the Burns-Porter Act.

DWR Complied with Water Code Section 147.5

Water Code section 147.5 outlines the procedures DWR must follow when renewing or extending long-term water supply contracts. Specifically, that statute requires DWR to present details of the contract terms at an informational hearing before the Legislature at least 60 days before final approval of the contract.

The petitioners claimed that DWR failed to meet these requirements because it submitted only draft amendments, not the final version, to the Legislature. The court rejected this argument, finding that Water Code 147.5 only mandates a presentation to the Legislature 60 days before contract approval and does not specify that the contract must be in its final form at this stage. The informational hearing could lead to further amendments, and the statute not require another hearing for such changes. Moreover, the purpose of Water Code Section 147.5 is to ensure high-level oversight of the renewal or extension of SWP long-term contracts, not to involve the Legislature in overseeing the details of finalizing these contracts.

The Petitioners failed to support their argument that the amendments are unconscionable.

The petitioners argued that it was unconscionable for DWR to reauthorize the terms of the existing contracts regarding water delivery amounts because those terms are impossible or impractical to fulfill. The Court of Appeal, like the trial court before it,  declined to consider this argument because the petitioners failed to offer any legal authority to support it.

DWR acted within its authority in approving the amendments.

Lastly, the petitioners argued that validating the amendments is improper because, according to the petitioners, the amendments provide DWR “absolute power” to enter into “unbounded” contracts. The petitioners, however, failed to demonstrate how validating the amendments would give DWR absolute and unrestricted contracting authority, particularly given that the validation action is limited to contracts tied to or directly related to DWR bonds. Validating the amendments does not give DWR a “free pass” to base its decisionmaking on “paper water.”

Conclusions and Implications

At bottom, the petitioners’ CEQA arguments in this case rested on two mistaken assumptions: first, that the amendment would transform the SWP, possibly leading to expanded SWP operations and a Delta conveyance project; and second, that without the amendments, the existing SWP contracts would terminate. The court rejected these assumptions. Although future capital improvement projects within the SWP may benefit from bond funding under the amendments, such future projects are speculative and not a reasonably foreseeable consequence of the amendments. Furthermore, the court found that it is reasonable for DWR to assume that the terms of the existing contracts will continue, regardless of these particular amendments. The contracts’ evergreen provision authorizes the contractors to request the same amount of continued water service indefinitely and several contractors had already exercised that option. Furthermore, California’s residents and farms depend on continued delivery of SWP water, and the contractors have invested enormous sums in the SWP. The court agreed with DWR’s pragmatic view that it is more plausible to anticipate contract extensions than their termination.

Having rejected the underlying premises of the petitioners’ claims, the court applied straightforward analyses to the petitioners’ CEQA claims. Case law firmly establishes that when a project proposes the continuation of existing activities, the baseline includes those activities. Therefore, DWR properly included the current contracts, including current operation of the SWP, as part of the baseline. Impacts caused by the current operation of the SWP are not impacts of the proposed amendments.

The law is also clear that projects with independent utility need not be treated as part of a larger project under CEQA. Here, the amendments have utility independent of future improvements to the SWP, including a potential Delta conveyance project. Moreover, such future projects are not a consequence of the amendments, since such projects could proceed with or without the amendments. In addition, CEQA does not requires agencies to speculate about the consequences of future, uncertain activities.

– Laura M. Harris

FOURTH DISTRICT HOLDS FAIR ARGUMENT STANDARD IS INAPPLICABLE TO CLAIM THAT HISTORICAL RESOURCE EXCEPTION PRECLUDES HISTORICAL RESOURCE CATEGORICAL CEQA EXEMPTION

General Posted by   

In Historic Architecture Alliance v. City of Laguna Beach (2023) 96 Cal.App.5th 186, the City of Laguna Beach approved a project to renovate and expand a historic single-family home. In doing so, the City determined that the project was categorically exempt from CEQA under the Class 31 historical resource exemption. Petitioners, the Historic Architecture Alliance and the Laguna Beach Historic Preservation Coalition (collectively, “Alliance”), alleged that the City improperly relied on the Class 31 exemption and that the historical resource exception to the categorical CEQA exemptions applied. Affirming the trial court’s denial of the petition, the Fourth District Court of Appeal held that the application of both the Class 31 exemption and the historical resources exception presented the City with the same factual issue, and that the City’s finding on this issue was supported by substantial evidence.

Background

In 2017, the owners of a historic single-family residence submitted their initial application and plans to the City to renovate and add on to the house. The City’s historical resources consultant reviewed the initial plans for compliance with the Secretary of the Interior’s Standards for the Treatment of Historic Properties (“Standards”), which provide guidance for achieving long-term preservation of historical features and materials.

When the consultant concluded that the initial plans did not fully comply with the Standards, the homeowners and their architect revised the plans and worked with the City to incorporate recommendations made by both the consultant and the City’s Heritage Committee and to ensure the project’s conformance to the Standards.

In 2020, the City approved the project. The City determined that the project satisfied the Standards and thus qualified for the Class 31 categorical CEQA exemption, which applies to historical resource renovation projects that are consistent with the Standards.

In 2021, Alliance filed a writ petition. The trial court denied the petition, finding that the City’s decision was supported by substantial evidence and that Alliance had not met its burden of demonstrating that an exception precluded reliance on the Class 31 exemption. Alliance appealed.

Court of Appeal’s Decision

Class 31 exemption

The court upheld the City’s reliance on the Class 31 exemption. The court explained that the determination that a categorical CEQA exemption applies is a factual one that is subject to review under the deferential substantial evidence standard. Pointing to the numerous rounds of review and revisions to bring the plans into compliance with the Standards and the City’s recommendations, the court concluded that the administrative record contained substantial evidence supporting the City’s determination that the project complied with the Standards, and therefore fell within the Class 31 exemption.

The court rejected Alliance’s argument that, by requiring various revisions to the project, the City was imposing mitigation measures to “shoehorn” the project into the Class 31 exemption. While the court acknowledged the general legal principle that mitigation measures may not be used to support categorical exemption, the court concluded that the plan revisions to bring the project into compliance with the Standards were not mitigation measures.

Historical resources exception

The court also rejected Alliance’s argument that the historical resources exception—which precludes reliance on a categorical CEQA exemption for projects “which may cause a substantial adverse change in the significance of a historical resource”—applied to the project. The court held that when applying the historical resource exception to the Class 31 exemption, the fair argument standard does not apply. Citing CEQA Guidelines section 15064.5(b)(3), which provides that projects that comply with the Standards “shall be considered as mitigated to a level of less than significant impact on the historical resources,” the court explained that “the decisive factor for the historical resource exception is the same as that for the [Class 31] exemption—whether the project complies with the [Standards].” Because an agency’s determination that the Class 31 exemption applies is reviewed for substantial evidence, the court reasoned that the exemption would be rendered “meaningless” if its underlying factual determination was then subject to the fair argument standard when applying the historical resources exception.

Thus, because the City’s determination that the Project satisfied the Standards was supported by substantial evidence, so too were the City’s reliance on the Class 31 exemption and the City’s finding that the historical resources exception did not apply.

SECOND DISTRICT HOLDS HOUSING PROJECT DOES NOT QUALIFY FOR CLASS 32 IN-FILL EXEMPTION BECAUSE OF INCONSISTENCIES WITH GENERAL PLAN POLICIES

General Posted by   

In United Neighborhoods for Los Angeles v. City of Los Angeles (2023) 93 Cal.App.5th 1074, the court held that the City of Los Angeles failed to consider the project’s consistency with the general plan’s applicable housing element polices, and that the challenging petitioner group sufficiently exhausted its administrative remedies regarding the inconsistencies by contesting the project’s consistency with the housing element’s general goals, without referencing the specific policies.

 Background

The City approved a project that would replace 40 apartment units subject to the City’s rent stabilization ordinance with a 156-room hotel, and determined the project was exempt from CEQA pursuant to the Class 32 in-fill exemption. United Neighborhoods for Los Angeles sought a writ of mandate arguing that the in-fill exemption does not apply because the project is not consistent with a general plan policy regarding the preservation of affordable housing. The trial court granted the writ, halting the project pending CEQA review or the City making a finding that the project is consistent with the policy at issue. The City appealed.

Court of Appeal’s Opinion

Exhaustion

The court concluded that United Neighborhoods exhausted its administrative remedies because its comments that the project’s demolition of the rent stabilized apartment units would conflict with the first goal of the housing element were sufficient to apprise the City of the issues raised in litigation. The court explained that United Neighborhoods’s references to the housing element’s general goals, rather than its specific policies, was immaterial because a general plan is structured in such a way that a project that is inconsistent with housing element goals will also conflict with the housing element policies. Moreover, the court found United Neighborhoods’s objection concerned multiple housing element policies relating to the preservation of, as opposed to the production of, affordable housing, and was therefore sufficient to apprise the City of the policies that United Neighborhoods’s objection implicated. Finally, the court emphasized that the City expressly acknowledged that United Neighborhoods’s objection was that the project’s removal of the apartment units would conflict with the housing element.

Consistency with General Plan Policies

The court held that substantial evidence does not support the City’s determination that the housing element policies are inapplicable, and that the City did not consider the project’s consistency with the applicable policies.

First, the court explained that the housing element policies are applicable to the project because the project will have an impact on the preservation of housing reflected in several of the housing element’s goals, objectives, and policies. The court found that the City focused only on the portions of the housing element that related to the production of new housing.

The court also rejected the City’s argument that “affordable housing” is a term of art that does not include rent stabilized housing units. The court explained that nothing in the housing element suggests that “affordable housing” is a term that deviates from its ordinary meaning, and therefore must refer to the dictionary definition: “housing that can be afforded by those on low or median incomes; spec. housing made available to those on lower incomes at a price below normal market value, as the result of legislation or subsidy by a local authority or the state.” Accordingly, the court determined that rent stabilized units are a form of “affordable housing” because they prohibit landlords from raising rents to reflect normal market value under certain circumstances. While the court acknowledged that deference is typically given to an agency’s finding of consistency with its own general plan, such deference is not given with respect to the City’s determination of which policies apply to the project.

Second, the court rejected the City’s argument that its consideration of the project’s consistency with the housing element can be inferred from its express discussion of other related policies. The court explained that the other policies that the City expressly discussed did not mention affordable housing and were less specific than the housing element policies.

The court was also not persuaded that the City’s conditional approval of the project on compliance with the Ellis Act—a requirement in the housing element—implied that it considered applicable housing element policies. It explained that the conditions of approval indicated that the Ellis Act condition is derived from the City’s Municipal Code, and therefore does not demonstrate the City’s consideration of the housing element policies.

While the court emphasized that the City was not required to make formal findings that housing element policies are outweighed by competing polices favoring the project, or that such a decision would necessarily conflict with the general plan, it concluded that a court cannot defer to the City’s weighing and balancing of general plan policies without supporting evidence that the City did weigh and balance all applicable policies.

Therefore, because the Class 32 in-fill exemption requires consistency with all applicable general plan policies, the court upheld the trial court’s determination that the City’s application of the exemption was unlawful.

FOURTH DISTRICT UPHOLDS CITY’S APPROVAL OF AN ADDENDUM TO A PROGRAM EIR FOR A RESIDENITAL HOUSING PROJECT

General Posted by   

In Olen Properties Corporation v. City of Newport Beach (2023) 93 Cal.App.5th 270, the Fourth District Court of Appeal held that no new conditions existed that would trigger the need for a subsequent EIR for a residential housing project in the designated Airport Area near John Wayne Airport.

Background

The City of Newport prepared an addendum to the City’s 2006 general plan program EIR for a residential housing project. The Project is a 312-unit residential housing development on an existing surface parking lot in a mixed-use development area, located within the designated Airport Area near the John Wayne Airport. The addendum concluded that the Project’s impacts would either be the same or not substantially greater than those described by the program EIR.

Olen Properties Corporation, an owner of commercial property near the Project site, challenged the City’s approval of the Project and the addendum. The trial court rejected the petitioner’s claims and the petitioner appealed, arguing that new conditions not addressed in the program EIR required the City to prepare a subsequent EIR, rather than an addendum.

The Court of Appeal’s Decision

Land Use

The Court of Appeal rejected the petitioner’s claims that the City violated several land use policies in the City’s general plan. First, it rejected the argument that the Project was not large enough to be consistent with the 10-acre requirement for a “mixed-use residential village” because the court determined that the City properly adopted the its Planning Commission’s definition of the Project to include the surrounding business area—thus satisfying this size requirement. Second, the court rejected the argument that the Project’s “public park” did not qualify as a required “neighborhood park.” The court found this terminology distinction meaningless. Third, the court found that the Project’s irregularly shaped park satisfied the minimum dimension requirements—which the court interpreted as exceeding 150 feet in two dimensions, measured from any point within the park’s space, rather than the lesser of the park’s length or width.

Standard of Review

The court explained that the reverse substantial evidence test described in Sierra Club v. County of Sonoma (1992) 6 Cal.App.4th 1307 applies only in limited circumstances where the initial EIR is a program EIR, and a subsequent project is proposed which is not the same or within the scope of the Project, program, or plan described in the program EIR. Otherwise, the appropriate standard is the deferential substantial evidence standard, under which the court considers whether substantial evidence supports the City’s determination that none of the conditions for requiring a subsequent or supplemental EIR under Public Resources Code section 21166 exist.

The court applied the deferential substantial evidence standard because the Project is within the scope of the projects described in the program EIR, which expressly contemplates the construction of higher density housing within the Airport Area.

Traffic

The court held that the City’s use of Level of Service instead of Vehicle Miles Traveled to analyze traffic impacts in the addendum for the Project was appropriate because the program EIR used LOS, and there is no feasible way to compare LOS with VMT. Moreover, the court explained that CEQA Guidelines section 15064.3 (the section requiring VMT to analyze traffic impacts) operates “prospectively” and subsequent changes to the guidelines are not “new information” triggering a subsequent EIR. Otherwise, the court reasoned, any changes to the CEQA Guidelines would trigger the preparation of an EIR for every project.

Hazardous Materials

The court rejected the petitioners’ argument that the proximity to a preexisting semiconductor plan would result in environmental impacts. The petitioner and the City provided conflicting expert opinions on this issue. The court concluded that because the substantial evidence standard of review applies, the City’s conclusion was supported and the petitioner’s conflicting evidence is inconsequential.

CC&Rs

The court rejected the petitioner’s claim that the Project does not comply with CC&Rs for the area because they are covenants between private parties, and there is no legal requirement for an agency to consider CC&Rs in an EIR. Moreover, the court explained that the CC&Rs predate the program EIR, and they therefore cannot constitute changes in the Project or its circumstances requiring a subsequent EIR.

Geology and Soils

The court rejected the petitioner’s claim that the Project’s geotechnical report recommendations indicated that impacts on geology and soil could be significant. The court explained that the recommendations were aimed at protecting the Project from corrosion from soil—such as by encasing metal materials in corrosion-resistant materials—and were not designed to protect the environment from the Project.

Lastly, the court concluded that the Project was not required to have a paleontologist physically present at the Project site constantly, and that the Project’s on-call paleontologist was consistent with the City’s general plan requirements.

FIRST DISTRICT UPHOLDS EIR FOR UC BERKELEY’S WILDFIRE FUEL MANAGEMENT PLAN

General Posted by   

In a partially published opinion Claremont Canyon Conservancy v. Regents of the University of California (2023) 92.Cal.App.5th 474, the First District Court of Appeal held that an EIR for wildfire-driven vegetation removal projects did not need to include a tree inventory or identify the number of or specific trees to be removed to comply with CEQA because the EIR contained sufficient information to analyze environmental impacts and preparing a tree inventory was not reasonably feasible.

Background

The Regents of the University of California, Berkeley worked with a wildland fire manager and fire ecologist to prepare a Wildland Vegetative Fuel Management Plan for an 800-acre fire-prone parcel of land on UC Berkeley’s campus, known as Hill Campus. Hill Campus is heavily forested and located in a “Very High Fire Hazard Severity Zone,” and “has been plagued by wildfires;” beginning in 1905 and most recently in 2017 when the Grizzly Fire burned approximately 24 acres. The Plan proposed several vegetation removal projects, including one fire fuel break project and three fire hazard reduction projects, with the goal of reducing the wildfire risk on Hill Campus. In developing the Plan and selecting the project locations, the Regents relied on fuel models to predict fire behavior, which considered the different vegetation types across Hill Campus. The Plan proposed removing dead, unhealthy or structurally unsound trees; trees that would torch or burn with high fire intensity; and certain understory shrubs.

The Regents prepared an EIR for the Plan, containing both programmatic and project-level review, and certified the Final EIR in early 2021. The EIR identifies objective criteria for tree removal and proposes the principle of “variable density thinning,” which considers site-specific conditions to create gaps in canopy cover to reduce canopy fire spread. The number of and specific trees to be removed would be determined by a certified arborist and registered professional forester by applying these criteria and this principle.

Two organizations, the Claremont Canyon Conservancy and the Hills Conservation Network, filed petitions for writ of mandate challenging the adequacy of the EIR’s description of the vegetation removal projects. After consolidating the cases, the trial court ruled in favor of the petitioners, concluding that the EIR’s project descriptions were “not accurate, stable and finite” and only provided “conceptual criteria,” rendering the project descriptions “vague and ambiguous.” The Regents appealed.

The Court of Appeal’s Decision

On appeal, Hills and Claremont argued that CEQA required the EIR to identify the specific trees that would remain in the fuel break area and that the EIR’s failure to specify the number of trees that would be removed made it was impossible to evaluate the projects’ environmental impacts; thereby rendering the EIR project description “unclear and unstable” and preventing meaningful comparisons between the plan and the project alternatives. The court disagreed.

The court pointed out that CEQA Guidelines section 15124 requires a project description to include specific information—“the precise location and boundaries of the proposed project on a detailed map; a general description of the proposed project’s objectives, including the project’s underlying purpose; a general description of the project’s technical, economic, and environmental characteristics; and a brief description of the EIR’s intended uses.” The court found that the EIR contained all of the required information. The CEQA Guidelines, the court noted, do not require a project description to “supply extensive detail beyond that needed for evaluation and review of the environmental impact[.]”

The court then noted that, here, where “a project is subject to variable future conditions,” such as “unusual rainy weather, tree growth, impact of pests and diseases, [and] changing natural resources,” a project description must “be sufficiently flexible” to account for those conditions. Hills argued that conditions within the project area would not substantively change in any “unforeseen way.” But, the court found this argument unavailing given the substantial evidence in the record demonstrating otherwise. The court then concluded that as long as an EIR contains sufficient information to enable decision-makers and the public to understand the projects’ environmental consequences it satisfies CEQA’s requirements. Accordingly, the court determined that the EIR “need not specify, on a highly detailed level, the number of trees [to be] removed.” The absence of this information did not violate CEQA because the project’s’ basic characteristics were “accurate, stable and finite,” contrary to the trial court’s determination.

The Regents further contended that it was not reasonably feasible to prepare a tree inventory and so the EIR could not violate CEQA for omitting one. The court agreed, finding sufficient evidence in the record to support this conclusion (steep and rugged terrain of Hill Campus created impediments, high cost associated with an inventory). Because the project area was subject to variable environmental conditions, on-the-ground realities could significantly change between the EIR’s preparation and project implementation, making it impractical to identify specific trees to remove.

Lastly, the court emphasized that “technical perfection, scientific certainty, and exhaustive analysis” are not required of an EIR; rather, it looks at whether the EIR is adequate, complete, and represents a good-faith effort at full disclosure. The court concluded that the EIR “provides sufficient information to understand the projects’ environmental impacts” and “sufficient detail to enable the public to understand the environmental impacts associated with the Regents’ plan to remove vegetation in specific locations on the Hill Campus to reduce wildfire risk.”

The remainder of the opinion disposing of other CEQA claims challenging the EIR’s methodology for wind speed modeling and its analysis of and visual impacts is unpublished.

– Alina Werth

SECOND DISTRICT UPHOLDS CITY OF POMONA’S RELIANCE ON CEQA GUIDELINES SECTION 15183 EXEMPTION FOR APPROVAL OF A ZONING OVERLAY DISTRICT ALLOWING COMMERCIAL CANNABIS ACTIVITIES

General Posted by   

In Lucas v. City of Pomona (2023) 92 Cal.App.5th 508, the Second District Court of Appeal held that the City of Pomona properly relied on the exemption provided in CEQA Guidelines section 15183 when approving a zoning overlay district allowing commercial cannabis activities on specific parcels located in certain areas within the City.

Background

In the years following the 2016 voter passage of the state’s Control, Regulate and Tax Adult Use of Marijuana Act, which legalized the cultivation, manufacturing, distribution, and sale of nonmedical cannabis and cannabis products, the City of Pomona passed several ordinances in anticipation of allowing cannabis operations within City limits—(i) an ordinance implementing a cannabis business tax; (ii) an ordinance establishing a formal application process to obtain a cannabis business license; and (iii) specifically relevant to the case, an ordinance to develop a commercial cannabis permit program overlay district within existing zoning designations in the City.

To establish this overlay district, constituting a “project” under CEQA, the City underwent a multifaceted process that included the establishment of buffers from sensitive uses such as schools, conducting research and site visits to other cities with legally operating cannabis businesses, meeting with applicable state agencies and the local police department, holding a series of community meetings, and conducting a City-wide parcel-level analysis.

Based on this process, the City determined that a total of six types of commercial cannabis activity could occur with the City—(1) store front retail, (2) manufacturing, (3) cultivation (indoor), (4) testing, (5) distribution, and (6) micro-business. The City prepared a “Determination of Significance” demonstrating that the proposed land uses “are consistent with and similar to already existing land uses” in “the Pomona Zoning Ordinance and the General Plan Update.”  The City also prepared an initial draft overlay map showing 414 parcels where cannabis businesses could be established. The initial map included a parcel owned by petitioner Lucas (which he claimed to have spent two million dollars preparing for operation of a cannabis business), however, the final draft excluded this parcel.

The City then had a third-party consultant prepare a “Findings of Consistency” document, which demonstrated that the project would not “have new or increased significant environmental effects beyond those identified in the 2014 [General Plan Update] EIR” by addressing “each of the environmental issues studied in the 2014 EIR [and] comparing the effects of the proposed project to the effects of the adopted General Plan Update.”

As a result, the City determined that the project qualified for the CEQA streamlining and exemption allowable under CEQA Guidelines section 15183.

At an October 2019 Planning Commission hearing considering the project, Lucas requested that the City reconsider including his property in the overlay district. Other parties opposed the project for different reasons—the nearby cities of La Verne and Walnut requested increased buffers from their City boundaries, as they both prohibited commercial cannabis activity and, in the case of Walnut, questioned CEQA Guidelines section 15183 applicability to the project. The Planning Commission did not recommend project approval to City Council and requested changes to the project.

After the hearing, petitioner and adjacent cities (amongst other commenters) sent correspondence to the City again expressing opposition to the project and making specific requests for changes. The project was thusly amended to create a 600-foot buffer from City boundaries and further remove more than a hundred parcels, leaving 292 parcels eligible for commercial cannabis activities.

In November 2019, the Pomona City Council approved the modified project and adopted the Determination of Significance and Findings of Consistency, and concluded that the project met the requirements in CEQA Guidelines section 15183. The City then filed a Notice of Exemption with the county recorder. The Determination of Significance states that the public has ten days to appeal. No one appealed.

Lucas filed a petition for writ of mandate alleging a CEQA violation for the City’s use of the Guidelines section 15183 exemption for the project. Three weeks before the hearing on the merits, at which the trial court found against petitioner, City voters passed Measure PO, “which adopted a cannabis permit overlay identical to the Project.” A few weeks later, the City Council adopted and ratified Measure PO. Lucas appealed the trial court’s decision, but did not file an appeal or request a court-ordered stay of Measure PO.

Court of Appeal’s Decision

The court bypassed the City’s standing and exhaustion of administrative remedies claims by assuming for sake of argument Lucas prevailed on these procedural issues, and therefore only reviewed the merits of the challenge to the City’s reliance on the CEQA Guidelines section 15183 exemption. The court reviewed this claim under the substantial evidence standard, which, per prevailing caselaw, is proper where an agency determines a project’s consistency with a prior program EIR.

To use the Guideline section 15183 exemption, as noted by the court, a project must be “consistent with the development density established by existing zoning, community plan, or general plan policies for which an EIR was certified,” whereas “consistent” means “the density of the proposed project is the same or less than the standard expressed for the involved parcel in the general plan, community plan or zoning action for which an EIR has been certified, and that the project complies with the density-related standards contained in that plan or zoning.”

As to density, Lucas argued that, because the existing zoning contains no density-related standards, there was no way for the project to be deemed consistent. The court disagreed with this “literal approach” and instead concluded that the omission of the “the exact word ‘density’ or exact phrase “density-related standards’” in a zoning ordinance “does not necessarily mean that those topics were not discussed with different verbiage.” Although the court did not illuminate what verbiage in the applicable zoning ordinance might demonstrate density, it did note that the 2014 General Plan Update EIR, the project’s Determination of Similarity, and the project’s Findings of Consistency all addressed land use and/or density. And, importantly, Lucas did not file an appeal of the Determination of Similarity conclusions. Therefore, he was “foreclosed from challenging any of [its] commercial cannabis activities/land findings.”

On the need for additional environmental review, the court again rebuked Lucas’ “literal approach.” The City’s Determination of Similarity deemed the six types of proposed cannabis land uses “similar to already existing land uses, and as such…covered by the uses contemplated by the 2014 EIR and 2013 General Plan Update.” Thus, just because the 2014 General Plan Update EIR did not contain the explicit words “marijuana” or “cannabis” did not mean it did not address that land use. The court likewise denounced Lucas’ argument that the project presents “unique and peculiar impacts associated with cannabis-related business” because, as it noted, the project itself “does not guarantee anyone the automatic right to establish a cannabis-related business,” it merely “imposes an overlay use on existing zoning” that only provides an opportunity to apply for a business permit. The court again relied on the findings in the Determination of Similarity “that cannabis uses were sufficiently similar to existing uses allowed by the underlying zonig” as substantial evidence supporting the City’s determination.

Lastly, Lucas argued that the project’s impacts on “traffic, air quality, greenhouse gas emissions, land use/planning, noise, and public services” did not fall within the scope of the less-than-significant conclusions made in the 2014 General Plan Update EIR. The court addressed each impact area, ultimately concluding that substantial evidence demonstrated that the project would not generate impacts beyond those identified in the 2014 EIR, and that existing mitigation measures and uniform standards applied to the project would reduce or manage any impacts.

Notably, the court found that Lucas’ concern with cannabis cultivation odor was addressed by the City’s municipal code regulating odor control devices. It also found that cultivation-related energy use, which petitioner claimed would result in “‘extraordinary [greenhouse gas emissions] impacts,’” could be dealt with through development standards, similarly to “other uses that could be developed in the Overlay District subareas.” On noise emitted by backup generators used in cannabis operations, the court opined that “[s]urely back-up generators are also utilized by other retail stores or manufacturers in times of a power outage.” And, in response to Lucas’ claim that the project would result in a greater impact on police services than analyzed in the 2014 General Plan Update EIR, the court noted in particular that “[t]he project would not result in the need for additional police protection facilities.”

– Casey Shorrock

SECOND DISTRICT UPHOLDS CITY OF VENTURA’S DETERMINATION THAT A 1989 BRONZE STATUE OF FATHER JUNÍPERO SERRA IS NOT A HISTORIC LANDMARK AND THEREFORE ITS RELOCATION WAS NOT SUBJECT TO CEQA

General Posted by   

In Coalition for Historical Integrity v. City of San Buenaventura (2023) 92.Cal.App.5th 430, the Second District Court of Appeal affirmed the trial court’s determination that the City of San Buenaventura, colloquially known as Ventura, acted appropriately and did not violate CEQA when it relocated a statue of Father Junípero Serra.

Background

In the summer of 2020, a bronze statue of Father Junípero Serra, located in downtown Ventura, was the subject of protests and vandalism. In response, the City Council voted to relocate the statue to the San Buenaventura Mission. The bronze statue, which was dedicated in 1989, had replaced a 1936-era concrete statue of Father Junípero Serra that had cracked and was in danger of falling apart.

A citizen’s group, the Coalition for Historical Integrity, challenged the City’s decision to relocate the statue and sought an injunction and restraining order to prevent the removal of the statue. The Coalition argued that the bronze statue was a historic landmark and therefore environmental review under CEQA was necessary. The trial court denied the Coalition’s request for relief and the City subsequently relocated the bronze statue to the mission. The Coalition appealed.

The Court of Appeal’s Decision

On appeal, the court held that removal of the bronze statue did not require CEQA review under Public Resources Code section 21084.1 because the “preponderance of the evidence” demonstrated that the statue was not “historically…significant” and likely did not match any definition of historical resources set forth in section 5020.1.

The Coalition first argued that the statue qualified as a historic resource because it was designated as such by the City in 1974. However, as the City countered and the court agreed, it was the original circa 1936 concrete statue that received a historic designation, and not the circa 1989 bronze statue. The Coalition then argued that the City’s historical resources report prepared by a third-party consultant, which found the statue to not be historically significant, did not constitute substantial evidence because it does not provide “participant testimony” and contained no evidence that its author was a qualified expert. The court again disagreed, because “municipal agencies can properly consider and base decisions on evidence that would not be admissible in a court of law” and because the report appeared sufficient. The court further rejected the Coalition’s argument “that section 21084.1 requires the City to find that the statue is ‘no longer’ culturally or historically significant,” noting that “there is no reason why the presumption cannot be rebutted by a finding that the statue was never culturally or historically significant.” Accordingly, the City appropriately determined that the bronze statue was not a historic landmark and thus not subject to CEQA review.

In affirming the City’s decision, the court noted that there is a “40-year-old threshold required for local designation as a historic landmark,” which the bronze statue did not meet. The court also disagreed with the Coalition’s argument that removal of the statue was quasi-judicial and that City Council unlawfully acted with bias and prejudice when deciding to relocate the statue. The court found that City Council was instead acting in a quasi-legislative manner, making a policy decision based on the statue being offensive to some members of the community, rather than a decision based on the criteria of a statute or ordinance. Because the statue was not considered a historic landmark, the court held that code provisions for removing a historic landmark status did not apply.

–  Alina Werth

SECOND DISTRICT HOLDS REGIONAL WATER BOARDS ARE NOT REQUIRED TO EVALUATE UNREASONABLE USE OF WATER OR MAKE FINDINGS OF SIGNIFICANCE WHEN ISSUING WASTEWATER DISCHARGE PERMITS

General Posted by   

UPDATE:

On June 2, 2023, the Second District Court of Appeal vacated their prior opinion and issued a revised opinion in Los Angeles Waterkeeper v. State Water Resources Control Board (2023) 92 Cal.App.5th 230, following a request for modification from the State Water Resources Control Board and the Los Angeles Regional Water Quality Control Board (collectively, the Boards). The Boards sought clarification about the Regional Board’s authority to regulate the unreasonable use of water under article X section 2 of the California Constitution and Water Code sections 100 and 275, and the scope of the CEQA exemption in Water Code section 13389. The court’s revised opinion maintains the original holdings but clarifies their scope.

The revised opinion makes clear that nothing in the holding was meant to limit a regional water quality control board’s authority to regulate the unreasonable use of water. According to the court, its decision expresses “no opinion as to whether the State Board may direct or authorize the regional water quality control boards to take actions related to preventing the waste or unreasonable use of water in coordination with the State Board’s efforts in this regard.” As noted by the court, this clarification is important to ensure that coordination between the regional water quality control boards and the State Board regarding issues of waste and unreasonable use of water can continue and is not undermined by language in the opinion.

The revised opinion also clarifies that, because the instant case only deals with NPDES-equivalent permits that are subject to the Water Code section 13389 CEQA exemption, the court did not decide whether the exemption applies to other types of waste discharge permits not at issue in this case.

– Alina Werth

 

In Los Angeles Waterkeeper v. State Water Resources Control Board (2023) 88 Cal.App.5th 874, rehearing granted March 27, 2023, the Second District Court of Appeal held that the Regional Water Quality Control Board does not have a duty to evaluate whether discharges of treated wastewater are an unreasonable use of water under article X, section 2 of the California Constitution and Water Code sections 100 and 275. The court also held that under CEQA, Regional Water Quality Control Boards are not required make findings of significance under Public Resources Code section 21002 when issuing wastewater discharge permits, which are exempt from CEQA pursuant to Water Code section 13389.

Background

The Regional Board renewed permits allowing four publicly owned treatment works (POTWs) to discharge millions of gallons of treated wastewater daily into the Los Angeles River and Pacific Ocean.

Petitioner requested review of the permits to the State Water Resources Control Board, which declined review. Petitioner then filed petitions for writs of mandate against the State Board and the Regional Board (collectively, the Boards), claiming violations of the Water Code and CEQA.

The Boards demurred to the petitions. The trial court sustained the demurrer as to the Regional Board, but overruled the demurrer as to the State Board, finding that the State Board had a constitutional and statutory duty to prevent the waste of water. The trial court also ruled that the Regional Board did not have to comply with CEQA when issuing wastewater discharge permits, pursuant to an exemption under the Water Code.

The trial court held that the State Board failed to fulfill its duty with regard to the four POTWs and accordingly issued four judgments and four writs of mandate against the State Board. The State Board appealed the four judgments. Real Party in Interest appealed the judgment against the State Board pertaining to its POTW. Petitioner appealed the trial court’s decision to sustain the demurrer in favor of the Regional Board. The appellate court consolidated the appeals.

The Court of Appeal’s Decision

California Constitution & Water Code

The Court of Appeal held that the Regional Board does not have a duty to evaluate whether discharges of treated wastewater are an unreasonable use of water under article X, section 2 of the California Constitution and Water Code sections 100 and 275. The court determined that the Legislature did not design or empower the Regional Board to enforce the mandates of article X, section 2 when issuing wastewater discharge permits. Moreover, it explained that the Regional Board’s role in state water law is to regulate water quality by ensuring the state’s waters are sufficiently free of pollutants to be safe for their intended uses—a role which does not include regulation of wasteful or unreasonable use of water. The court stated that nothing in the Water Code delegates the Regional Board powers to adjudicate and regulate functions of the state in the field of water resources or to take all appropriate proceedings or actions to prevent waste and unreasonable use of water, as it delegates to the State Board.

The court rejected petitioner’s argument that article X, section 2 applies to all government actors, including the Regional Board. It explained that while an action could be brought against anybody for wasting water, petitioner’s claims did not allege that the Regional Board was wasting water, but rather, failed to prevent the POTWs from wasting water, and nothing in article X, section 2 or the Water Code empowers the Regional Board to prevent unreasonable use of water.

The Court of Appeal did not need to reach the issue of whether the State Board has a duty to prevent unreasonable use of water because it concluded that petitioner failed to adequately plead a cause of action against the State Board. It nonetheless explained that the provisions in the California Constitution and the Water Code requiring the State Board to prevent the waste of water are highly discretionary and do not require the State Board to prevent all waste, nor do they dictate how to prevent waste. Therefore, these provisions cannot be read to restrict the State Board’s discretion as to whether to direct its resources towards one method of conservation in its portfolio over another.

CEQA

The Court of Appeal held that Public Resources Code section 21002 does not apply to wastewater discharge permits and, accordingly, the Regional Board is not required to make findings as to whether a project has significant and unavoidable impacts, and whether there are feasible alternatives or mitigation measures that would substantially lessen those impacts.

The appellate court rejected petitioner’s argument that section 21002 imposes environmental review requirements independent of CEQA’s environmental impact report (EIR) procedures from which the wastewater discharge permits are exempt under Water Code section 13389. The court explained that section 21002 does not impose requirements separate from the EIR process; it only has force to the extent an entity is otherwise obligated to prepare an EIR. The court based its reasoning in the language of sections 21002, 21002.1, and 21082, all of which confirm that the EIR is the means by which the agency satisfies the policies articulated in 21002.

The appellate court also rejected petitioner’s argument that an agency can comply with section 21002 by means other than an EIR, and that the Regional Board can comply with this section by using the information and analysis it collects and performs in the normal course of permit approvals. The court explained that it will not read section 21002 to impose such requirements when the Legislature has not specified any means to carry out those requirements apart from an EIR, as there would be no way for a court to evaluate whether the Regional Board’s efforts were sufficient. The court concluded that the Legislature has opted to govern environmental review in this context through the wastewater discharging process by exempting the Regional Board from an EIR requirement.

The court accordingly did not need to reach the broader question of whether Water Code section 13389 provides a complete exemption from CEQA.

– Veronika S. Morrison

SECOND DISTRICT UPHOLDS CLASS 1 EXEMPTION FOR PROJECT TO EXPAND SINGLE-FAMILY HOME

General Posted by   

In Arcadians for Environmental Preservation v. City of Arcadia (2023) 88 Cal.App.5th 418, the Second District Court of Appeal upheld a finding by the City of Arcadia that a project to expand and add a second story to a single-family home was categorically exempt from CEQA. In doing so, the court concluded that petitioner failed to exhaust its administrative remedies regarding the scope of the exemption and failed to demonstrate that the city improperly relied on the exemption.

Background

Over a nearly two-year period beginning in June 2018, project applicant submitted, revised, and re-submitted an application to her homeowners’ association (HOA), seeking to expand the first floor of her single-family home and add a second floor. In April 2020, after the HOA’s architectural review board twice rejected her project, the applicant appealed the rejection to the city’s planning commission.

In May 2020, after a noticed hearing, the planning commission voted to conditionally approve the project, so long as various proposed changes were incorporated. The planning commission found that the project qualified for a Class 1 categorical exemption for modifications to existing structures.

The applicant’s neighbor appealed the planning commission’s approval to the city council. The city council upheld the planning commission’s decision.

The neighbor then formed the petitioner organization and filed a petition for writ of mandate challenging the city’s compliance with CEQA. Shortly thereafter, the city filed a Notice of Exemption for the project. The trial court denied the petition. Petitioner appealed.

Court of Appeal’s Decision

The court held that (1) petitioner failed to exhaust its administrative remedies on the issue of whether the project was within the scope of the Class 1 exemption, (2) the city did not abuse its discretion by impliedly determining that no exceptions to the categorical exemption applied, and (3) petitioner failed to demonstrate that the cumulative impacts exception precluded the city’s reliance on the Class 1 exemption.

Failure to Adequately Exhaust

Petitioner argued that the city erred in determining the Class 1 exemption applied and cited the neighbor’s comments during his administrative appeal as support that petitioner had adequately exhausted on this issue. The court disagreed, reasoning that the neighbor (or anyone else) failed to articulate why the Class 1 exemption was inapplicable. Instead, the court noted that the neighbor made only “general references to potential environmental impacts” that did not fairly apprise the city of petitioner’s specific objection that the exemption did not apply.

The court rejected petitioner’s argument that its member had impliedly objected to the city’s exemption finding by requesting an EIR. The court conceded that a request for an EIR suggests a belief that no exemption applies but explained that such a request nevertheless does not adequately notify the agency about the substance of the challenge.

The court acknowledged that CEQA’s exhaustion requirement may be excused if the agency provides no opportunity for public comment or fails to give notice; however, it concluded that petitioner’s failure to exhaust was not excused in this case. Although the city did not consistently identify the specific subdivision of the Class 1 exemption that it relied on, the court concluded that this discrepancy was immaterial.

Exceptions to the Exemption

The court next rejected petitioner’s argument that the city failed to proceed in a manner required by law by failing to expressly consider whether an exception precluded the application of the Class 1 exemption. The court explained that the city’s determination that the Class 1 exemption applied necessarily included an implied finding that no exception precluded its application. The court reasoned that, while the city could not ignore contrary record evidence when making its finding, the finding did not need to be express.

After noting that there was “some question” whether petitioner’s comments during the administrative appeal preserved an argument that the cumulative impacts exception precluded the application of the Class 1 exemption, the court concluded that, regardless, that the argument failed on its merits.

The court concluded that petitioner’s general reference to “cumulative environmental effects caused by multiple large-scale projects,” along with identification of various nearby projects, did not amount to evidence of actual impacts that would result from the project and other nearby projects. The court rejected petitioner’s evidence that the cumulative impacts exception applied as “pure speculation” that could not, without more, preclude application of the Class 1 exemption.

Louisa Rogers

12345