By William W. Abbott

Cinema West, LLC v. Christine Baker 2017 Cal.App. LEXIS 599

As former redevelopment agency properties come back into the marketplace, prospective developers must proceed cautiously to avoid tripping on the State’s prevailing wage law. What appears to be a fair market transaction may include a disguised agency contribution or publically funded construction, thus triggering prevailing wage for the entire development project. Frequently, this obligation does not surface until after the project is under construction.

The City of Hesperia became the successor agency to its redevelopment agency following dissolution by the state legislature. For a number of years, the City sought the development of the first theater complex inside the City limits. Eventually, as the successor agency, the City negotiated a fair market priced sale to Cinema West, LLC, (“Cinema”) to develop a 12-screen complex. As part of the negotiations, the City would construct the parking lot, provide reciprocal easements, develop a water retention system for the theater and parking lot, and construct offsite improvements. The theater operator would sign a 10-year operating covenant for the theater. The documents recited that the developer was providing all the financing for the theater and permits, and that the City was purchasing the operating covenant in the form of a forgivable loan in the amount of $1,546,363. The City also agreed, as part of the consideration for the operating covenant, to the payment of $102,259., to Cinema a sum equal to the purchase price paid by the theater developer for the land. As the project moved forward, construction costs proved to be greater than originally budgeted. The City provided an additional $250,000 in the form of a forgivable loan in exchange for a second operating covenant.

Nearing the end of theater construction, Union Local 477 sought a public works coverage determination by the Director of the Department of Industrial Relations. Following submittal of documents by the City and written arguments by Cinema, the Director concluded that the theater was a public work subject to prevailing wage requirements. This conclusion was reached based upon the City payment of $102,259, the two forgivable loans, and the construction of the parking lot and offsite improvements. Cinema filed a timely appeal. The Director considered the additional evidence and argument, but affirmed its initial decision. The Department then initiated a wage enforcement proceeding. Cinema then filed a writ in superior court and sought injunctive relief against the enforcement proceeding. The superior court ruled in favor of the Department.

On appeal, the Appellate Court also affirmed. Procedurally, Cinema argued that it was entitled to present extra record evidence before the Superior Court. Both the trial court and appellate court rejected this argument, citing the established cases that extra record evidence (that is evidence not presented to the administrative tribunal) can only come in at trial in limited circumstances.

Turning to the merits, Cinema made four arguments (1) private construction is not subject to prevailing wage merely because other related construction is publically funded; (2) mere coordination of two related construction projects does not create a complete integrated “object”; (3) Cinema did not receive public funds or their equivalent; and (4) the construction of the parking lot did not transform the private theater into a public work. Looking at the totality of circumstances, the appellate court concluded that the evidence supported the conclusion that the parking lot construction and theater were interlinked. This evidence included communications by the Cinema to the City describing the City’s contribution along with the approving resolutions referencing the City’s contributions. Other factors weighed in support of finding the requisite relationship between theater and parking lot, including timing of construction, the use of the same contractor and the fact that the theater did not meet the City’s parking requirements without use of the parking lot. The appellate court also considered that the evidence regarding the forgivable loans as reflecting a public subsidy, but eventually concluded that it need not reach that issue.

Given the expansive statutory definition of public works for prevailing wage purposes, developers need to look closely at any transaction which goes beyond a fair market sale.

William W. Abbott is a shareholder at Abbott & Kindermann, Inc. For questions relating to this article or any other California land use, real estate, environmental and/or planning issues contact Abbott & Kindermann, Inc. at (916) 456-9595.

The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, Inc., or the formation of a lawyer/client relationship. Because of the changing nature of this area of the law and the importance of individual facts, readers are encouraged to seek independent counsel for advice regarding their individual legal issues.

By William W. Abbott, Diane Kindermann, Glen Hansen, Brian Russell and Dan Cucchi

Welcome to Abbott & Kindermann’s 2017 2nd Quarter cumulative CEQA update. This summary provides links to more in depth case write-ups on the firm’s blog. The case names of the newest decisions start with Section 3 and are denoted by bold italic fonts.

  1. 2016 CEQA UPDATE

 To read the 2016 cumulative CEQA review, click here: 

  1. CASES PENDING AT THE CALIFORNIA SUPREME COURT

There are 4 CEQA cases pending at the California Supreme Court. The cases, listed newest to oldest, and the Court’s summaries are as follows:

Union of Medical Marijuana Patients, Inc. v. City of San Diego, S238563. (D068185; 4 Cal.App.5th 103; San Diego County Superior Court; 37-2014-00013481- CU-TT-CTL.) Petition for review after the Court of Appeal affirmed the judgment in an action for administrative mandate. This case presents the following issues: (1) Is the enactment of a zoning ordinance categorically a “project” within the meaning of the California Environmental Quality Act (Pub. Resources Code, § 21000 et seq.)? (2) Is the enactment of a zoning ordinance allowing the operation of medical marijuana cooperatives in certain areas the type of activity that may cause a reasonably foreseeable indirect physical change to the environment? 

Cleveland National Forest Foundation v. San Diego Assn. of Governments,

S223603. (D063288; 231 Cal.App.4th 1056, mod. 231 Cal.App.4th 1437a; San Diego County Superior Court; 37-2011-00101593-CU-TT-CTL, 37-2011-00101660-CU-TTCTL.) Petition for review after the court of appeal affirmed the judgment in a civil action. The court limited review to the following issue: Must the environmental impact report for a regional transportation plan include an analysis of the plan’s consistency with the greenhouse gas emission reduction goals reflected in Executive Order No. S-3-05, so as to comply with the California Environmental Quality Act (Pub. Resources Code, § 21000 et seq.)? 

Friends of the Eel River v. North Coast Railroad Authority, S222472. (A139222; 230 Cal.App.4th 85; Marin County Superior Court; CV1103591, CV1103605.) Petition for review after the court of appeal affirmed the judgments in actions for writ of administrative mandate. This case includes the following issues: (1) Does the Interstate Commerce Commission Termination Act [ICCTA] (49 U.S.C. § 10101 et seq.) preempt the application of the California Environmental Quality Act [CEQA] (Pub. Resources Code, § 21050 et seq.) to a state agency’s proprietary acts with respect to a state-owned and funded rail line or is CEQA not preempted in such circumstances under the market participant doctrine (see Town of Atherton v. California High Speed Rail Authority (2014) 228 Cal.App.4th 314)? (2) Does the ICCTA preempt a state agency’s voluntary commitments to comply with CEQA as a condition of receiving state funds for a state owned rail line and/or leasing state-owned property? 

Sierra Club v. County of Fresno, S219783. (F066798, 226 Cal.App.4th 704; Fresno County Superior Court; 11CECG00706, 11CECG00709, 11CECG00726.) Petition for review after the court of appeal reversed the judgment in an action for writ of administrative mandate. This case presents issues concerning the standard and scope of judicial review under the California Environmental Quality Act. (CEQA; Pub. Resources Code, § 21000 et seq.)

  1. UPDATE 
  • Ministerial v. Discretionary 

Sierra Club v. County of Sonoma (2017) 11 Cal.App.5th 11.

The County issued an erosion-control permit to allow the establishment of a vineyard on land currently used for grazing. Petitioners challenged the issuance of the permit arguing it was a discretionary decision which triggered compliance with the California Environmental Quality Act (“CEQA”). The County argued the permit was ministerial and was, thus, exempt from CEQA. The dispute centered on the interpretation of the County Code and how much discretion the County Agricultural Commissioner can exercise when approving the permits.

The petitioners argued that the relevant provisions of the County Code were broad and vague, thereby allowing the Commissioner to exercise significant discretion. The court found petitioner’s claims unpersuasive, because most of the provisions that provide the Commissioner with considerable latitude were inapplicable to the issuance of the challenged permit. The court reasoned that even if the contested provisions could overcome the County’s position, the discretion arguably conferred to the Commissioner is only relevant when those discretionary provisions are applied to the approval of a specific permit.

The Court then turned to petitioner’s argument that three provisions that did apply conferred additional discretion, namely provisions requiring: (1) a 50-foot setback from wetlands, “unless a wetlands biologist recommends a different setback”; (2) stormwater to be diverted “to the nearest practicable disposal location”; and (3) incorporation “of natural drainage features…whenever possible.” The Court rejected these claims, reasoning that in contrast to prior seminal cases involving discretionary approvals, such as Friends of Westwood, Inc. v. City of Los Angeles, 191 Cal.App.3d 259 (1987), these provisions did not confer the ability to mitigate environmental impacts in a meaningful way. It further reasoned that in each instance petitioners failed to cite to any evidence in the record that demonstrated that the County had discretion or that any discretion found would mitigate potential environmental impacts to any meaningful degree.

Lastly, the Court turned to petitioner’s claims that the Commissioner’s ability to request additional voluntary actions rendered the permit discretionary. The Court held the requests did not establish the exercise of discretion. It reasoned that despite the inclusion of several mitigation measures in the permit’s conditions of approval, because the ordinance does not require the requested measures, the Commissioner had no authority to require them and the applicant’s acceptance of the voluntary request is insufficient to transform an otherwise ministerial permit into a discretionary one.

  • Piecemealing 

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

The County of Santa Cruz, as part of its plan to overhaul its zoning ordinance, adopted three separate ordinance amendments to: (1) expand the minor exceptions to the zoning site standards; (2) alter the height, density, and parking requirements for hotels in its commercial districts; and (3) adopted an administrative approval process for some minor exceptions to the sign ordinance. The County relied on a negative declaration for each of the first two amendments and found the third amendment was exempt. In each case, the County considered them separate and distinct projects under CEQA. The Aptos Council challenged the approvals, arguing the County had improperly “piecemealed” the CEQA evaluation for the projects by failing to consider them as a single project. In addition, the Council challenged the negative declaration for the hotel amendment, arguing the CEQA analysis failed to consider the impacts of future development that would be permitted by the ordinance.

Affirming the trial court, the appellate court denied the Council’s petition. It rejected the Council’s claim that the County improperly piecemealed the CEQA analyses for each amendment, because, as stated in Banning Ranch Conservancy v. City of Newport Beach, 211 Cal.App.4th 1209 (2012), each amendment could be “implemented independently.” As to the hotel amendment, the Court found that the County’s analysis properly considered some potential impacts of future development, but concluded that additional impacts described by the Council were speculative and, thus, were not a reasonably foreseeable consequence of the amendment. 

  • Subsequent Environmental Review 

Friends of College of San Mateo Gardens v. San Mateo County Community College Dist. (2017) 11 Cal.App.5th 596.

In the follow up decision to the Supreme Court’s decision in Friends of the College of San Mateo Gardens v. San Mateo County Community College District (2016) 1 Cal.5th 937, the Appellate Court invalidated the District’s reliance upon the addendum to the previously adopted mitigated negative declaration. In the facts of San Mateo Gardens, the District proposed to modify a previously approved 2006 master plan calling for the demolition of up to 16 buildings and the renovation of several others at the campus. It later adopted an addendum to address the modifications to the master plan which included the removal of a portion of the gardens surrounding a building newly designated for demolition and the renovation of two other buildings that were previously slated for demolition.

First, the Appellate Court applied the substantial evidence test to review the agency’s decision to rely upon the prior mitigated negative declaration and use CEQA’s subsequent review provisions. The Court found there was sufficient evidence to support the lead agency’s decision, because the project’s changes did not affect the 2006 decision and MND to demolish the other 14 buildings nor the previously established mitigation measures. Thus, the agency’s determination that there was continuing utility to the 2006 decision and related environmental analysis was proper.

Moving to the second question, however, the appellate court found the use of an addendum was inadequate under CEQA. Given the agency’s reliance upon a mitigated negative declaration in the first instance, the court held that the use of an addendum was improper when “the proposed modification may produce a significant environmental effect that had not previously been studied.” Based upon the testimony of students and faculty about the aesthetic impacts on the campus gardens, the appellate court concluded there was sufficient evidence to support a fair argument of a new aesthetic impact not previously analyzed and set aside the use of an addendum. The Court, thus, affirmed the lower court judgment in favor of the petitioner. But, rather than directing the agency to prepare an EIR, the court concluded that the agency could “choose to prepare a subsequent MND if it determines that the possibly significant environmental effects will ‘be reduced to insignificance’ through the implementation of mitigation measures.” 

  • Environmental Impact Reports 

Poet, LLC v. State Air Resources Board (2017) 12 Cal.App.5th 52.

In 2013, the Fifth District Court of Appeal issued a writ of mandate compelling CARB to revise its environmental document in support of its 2009 adoption of the Low Carbon Fuel Standards (“LCFS”) to ensure compliance with CEQA. (See POET, LLC v. State Air Resources Board (2013) 218 Cal.App.4th 681.) After Carb adopted the revised environmental document, Poet, LLC (“Poet”), challenged whether the analysis adequately evaluated the project’s impacts on biodiesel consumption and the related increases in NOx emissions that would result. Specifically, Poet challenged CARB’s use of a 2014 NOx emissions baseline to evaluate the impacts of the regulations. CARB argued the 2014 baseline was appropriate under these circumstances, because the changes in biodiesel use and technology in the years after the 2009 LCFS adoption, and the modified LCFS regulations and new Alternative Diesel Fuel (“ADF”) regulations adopted in 2015, made it “impossible to determine what portion of the increase in use is attributable to the original LCFS,” and, thus, would not yield any environmentally meaningful information.

The Appellate Court was unpersuaded and held that CARB was required to set the baseline at 2009 levels. It reasoned that CEQA’s requirement that environmental review must consider “the whole of the action,” as well as the explicit requirements under the writ of mandate, necessitated that the analysis consider not only the original LCFS regulations, but also the 2015 LCFS and ADF regulations, in order to fully inform the decision makers and the public of any significant environmental impacts of their adoption. The Court then issued a revised writ directing CARB to freeze into place the 2017 standards for diesel fuel and its substitutes adopted under the 2015 LCFS until a CEQA-compliant environmental document using the proper baseline is completed. 

Banning Ranch Conservancy v. City of Newport Beach (2017) 2 Cal.5th 918.

Petitioners sued the City of Newport Beach over the approval of a residential and commercial project on one quarter of a 400-acre, largely undeveloped coastal property. The petitioners objected to the City’s EIR, arguing it failed to identify potential impacts to “environmentally sensitive habitat areas” (“ESHA”), defined by the California Coastal Act, as a result of the project. The Coastal Commission had not yet determined whether ESHAs were present at the site and the site was explicitly excluded from the City’s coastal land use plan. Petitioners also challenged the project on general plan consistency grounds, asserting that the County had failed to adequately “work with” the Coastal Commission to identify wetlands and habitats. The Appellate Court held that the City was not required to speculate as to the presence of ESHAs at the site in its EIR, because it is a legal conclusion to be made by the Coastal Commission. Instead, the City’s EIR analysis was sufficient because it included all of the necessary data and analysis regarding biological resources and habitat. The Court also found the project was consistent with the City’s general plan because the City could work with the Commission post-approval when it obtains the necessary coastal development permit. Petitioners appealed and the California Supreme Court granted the petition for review.

The California Supreme Court reversed. It held that CEQA’s requirement to concurrently integrate CEQA compliance with other related review procedures “required by law or by local practice” (CEQA Guidelines §15080), obligated the City to include at least some analysis of the impacts to known and potential ESHAs present on the site. It found the City’s reasoning for deferring the analysis was not persuasive, given the “ample evidence that ESHA are present on Banning Ranch.” As for the general plan consistency claim, the Court decided it need not address the issue, holding it was unnecessary as sufficient relief was already granted under CEQA.

Residents Against Specific Plan 380 v. County of Riverside (2017) 9 Cal.App.5th 941.

Riverside County approved a specific plan and related regulations for a mixed-use project located on 200 acres. The specific plan, as modified by the Board of Supervisors prior to its approval, included seven planning areas with different allocations of allowed land uses. The EIR analyzed a project consisting of eight planning areas with different land use allocations across the project site than the adopted specific plan. Among other commenters, the air district and a nearby city both suggested mitigation measures to reduce air quality impacts in comments on the Draft EIR. Additional noise mitigation measures were also proposed during the final hearing before the Board. The Final EIR included responses to comments, including those of the air district and nearby city, but as to those comments concluded that the proposed mitigation measures were infeasible. The petitioners filed suit and the trial court denied the claims. The petitioners appealed.

The Appellate Court denied the appeal, rejecting the arguments of multiple CEQA claims, finding: (1) there were no procedural errors concerning the County’s practice of passing a motion of intent to approve and the later final approval; (2) EIR recirculation was not required because the decision not to recirculate due to the changes in the project was supported by substantial evidence; (3) errors in the notice of determination were not prejudicial; (4) there was sufficient evidence in the record to support rejection of suggested mitigation measures; and (5) the County had no duty to formally respond to late comments.

  • Litigation

The Urban Wildlands Group, Inc. v. City of Los Angeles (2017) 10 Cal.App.5th 993.

Urban Wildlands Group, Inc. (“UWG”) filed a petition for writ of mandate challenging the City’s use of a California Environmental Quality Act (“CEQA”) exemption for the replacement of street lamp bulbs with new light emitting diodes (“LEDs”). The City certified the Administrative Record, and UWG was ordered to lodge the administrative record pursuant to an agreement. UWG filed its opening and reply briefs, and the City filed its opposition brief, but UWG’s attorney did not lodge the administrative record. The Court found in favor of the City, finding that UWG could not support its arguments because the administrative record was not lodged with the court. UWG subsequently filed a motion to vacate the judgment arguing they were entitled to relief under both the discretionary and mandatory relief provisions in Code of Civil Procedure section 473. The Court granted relief under the mandatory provisions due to UWG’s attorney’s affidavit attesting to a “mistake, inadvertence, surprise, or neglect resulting in a default or dismissal.” The City appealed, and the Court of appeal reversed. Disapproving of prior case law which took a more expansive meaning of “default judgment” (In re Marriage of Hock & Gordon-Hock (2000) 80 Cal.App.4th 1438; Avila v. Chula (1997) 57 Cal.App.4th 860), it held that the trial court ruling was not “a default, default judgment, or dismissal,” because the failure to lodge the administrative record was akin to the failure to provide sufficient supporting evidence to meets its burden of proof in a trial on the merits.

Friends of Outlet Creek v. Mendocino County Air Quality Management District (2017) 11 Cal.App.5th 1235.

The operator of a proposed asphalt plant, after receiving approval from the Mendocino County Board of Supervisors, applied for an Authority to Construct permit (“ATC”) from the District. The District air pollution control officer relied on the County’s prior environmental review to conclude that issuance of the ATC did not require any additional environmental review to comply with CEQA. The petitioner filed an administrative appeal to the District Board challenging the officer’s decision. The District Board denied the appeal, citing the prior land use decisions and environmental review, and the petitioner filed suit on the ground that the District did not comply with CEQA. The District demurred, arguing the petitioner was only entitled to a claim under Health & Safety Code section 40864, which they maintained did not support a CEQA challenge. The trial court sustained the demurrer and the petitioner appealed.

The Court of Appeal overruled the trial court. It found no case law supporting the District’s position that only Health & Safety Code section 40864 can be invoked to challenge the issuance of an air quality permit. Instead, it reasoned that not only do several cases support a petitioner’s right to challenge ATCs on CEQA grounds, but as an administrative proceeding, a suit challenging the ATC issuance proceeds under Code of Civil Procedure section 1094.5. Thus, the Appellate Court held that the petitioner could advance claims against the District under Health & Safety Code section 40864, CEQA, or both. The District also raised an additional defense—that the ATC issuance was ministerial—but the Appellate Court held that the record was too lacking to evaluate the District’s determination and held that it could not dismiss the appeal on that basis.

Association of Irritated Residents v. Department of Conservation (2017) 11 Cal.App.5th 1202.

Petitioners challenged the Department’s issuance of permits for 214 new oil wells in Kern County, arguing that the Division of Oil, Gas, and Geothermal Resources (“DOGGR”) failed to comply with CEQA because no CEQA exemption applied to the permit and DOGGR did not conduct any other environmental review. DOGGR demurred, arguing the claims were res judicata, or barred, as a result of a similar prior action filed in Alameda County. The Department argued that the Alameda County action was a final judgment on the merits which rejected similar claims against DOGGR’s issuance of oil well permits. Petitioners argued the prior decision was found to be moot due to the passage of Senate Bill 4 in 2013, and was not on the merits. The trial court agreed with the Department and sustained the demurrer, and petitioners appealed. The Court of Appeal ruled in favor of petitioners. The Department argued that the Alameda Court had reached the merits of the case when it analyzed relevant provisions with Senate Bill 4 which required DOGGR to issue permits within a certain time period when the permit applications met the statutory conditions for issuance. The Department argued that this analysis was on the merits, because it showed how the new process rendered the claims moot. The Court rejected the argument, however, reasoning that the review was limited to supporting the Court’s position that the prior process was changing and, thus, petitioner’s arguments about past practices were no longer relevant to rule on future activities. Therefore, the Appellate Court remanded the case back to the trial court for further proceedings. 

If you have any questions about these court decisions, contact William Abbott, Diane Kindermann or Daniel Cucchi. The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, Inc. nor the formation of a lawyer/client relationship. Because of the changing nature of this area of the law and the importance of individual facts, readers are encouraged to seek independent counsel for advice regarding their individual legal issues.

http://blog.aklandlaw.com/2017/01/articles/ceqa/2016-ceqa-annual-review/

On September 19, 2016, California Governor Jerry Brown signed Senate Bill 1383 (Lara, 2016 Stats., ch. 395), which is designed to address short-lived climate pollutants (“SLCPs”), including methane gas. In SB 1383, the Legislature found that (1) SLCPs are “powerful climate forcers that have a dramatic and detrimental effect on air quality, public health, and climate change”; (2) that SLCPs create “a warming influence on the climate that is many times more potent than that of carbon dioxide”; and (3) that reducing emissions of SLCPs “can have an immediate beneficial impact on climate change and on public health.” SB 1383 requires the State Air Resources Board (“ARB”) to approve and begin implementing a comprehensive strategy to reduce emissions of SLCPs. That includes a reduction in methane by 40% below 2013 levels by 2030. The reduction target for methane under SB 1383 can be summarized in the following chart:

Methane Inventory

(2013)

Methane Forecast

(2030)

Methane Target

(2030)

Percent Reduction From 2013 Levels
118 117 71

40%

Note: Emission levels are listed in MMTCO2e.

The Short-Lived Climate Pollutant Reduction Strategy Targets Dairy Operations.

The comprehensive strategy described in SB 1383 is the “Short-Lived Climate Pollutant Reduction Strategy” (“SLCP Strategy”) that was released by ARB on March 23, 2017. Senate Bill 605 (Lara, 2014 Stats., ch. 395) directed ARB to begin drafting that strategy, and SB 1383 ordered the ARB to complete that strategy and begin implementing it by January 1, 2018. The SLCP Strategy will inform and will be integrated into the 2017 Climate Change Scoping Plan Update. The SLCP Strategy explains that “an increase in the global average temperature of 2°C (3.6°F) above pre-industrial levels, which is only 1.1°C (2.0°F) above present levels, poses severe risks to natural systems and human health and well-being,” and that “[d]eploying existing technologies and resource management strategies globally to reduce SLCP emissions can cut the expected rate of global warming in half and keep average warming below the dangerous 2°C threshold at least through 2050.”

Scientists have estimated that methane is responsible for about 20 percent of current net climate forcing globally. Manure is responsible for 25 percent of California’s methane emissions. Therefore, the SLCP Strategy is designed to outline the goals, regulations, incentives and other efforts that would, among other things, “[s]ignificantly cut methane emissions from dairy and livestock operations while providing farmers with new, potentially lucrative revenue streams ….”

The State Envisions Collaborative Efforts With Dairies Before Regulations Are Implemented.

SB 1383 requires ARB to adopt regulations to reduce methane emissions from livestock manure management operations and dairy manure management operations. Such regulations would take effect on or after January 1, 2024, if ARB, in consultation with the Department of Food and Agriculture, makes certain determinations.

The SLCP Strategy provides that, before ARB regulates dairy manure emissions pursuant to SB 1383, state agencies will “encourage and support near-term actions by dairies to reduce manure emissions through financial incentives, collaboration to overcome barriers, development of policies to encourage renewable natural gas production, and other market support.” ARB expects a collaborative effort to reduce methane emissions, in which the dairies are active participants. The SLCP Strategy states:

Strong market support and broad collaboration among State agencies, industry, and other stakeholders will be necessary to reduce landfill and manure methane emissions by putting organic waste streams to beneficial use. The State will support early action to build infrastructure capacity and reduce emissions through existing incentives and accelerated efforts to overcome barriers and foster markets. Government agencies and stakeholders will work to foster market conditions to support private sector investment in expanded or new infrastructure, including building markets for compost, soil amendments, and low carbon transportation fuels; overcoming barriers to pipeline injection of biomethane, grid connection for electricity or another best-use alternative; and identifying effective financing mechanisms and levels to reach the goals in this SLCP Strategy.

Ultimately, a combination of incentives, State and private sector collaboration and investment, and regulations will be necessary to capture the value in organic waste streams and ensure lasting emission reductions in order to achieve an economy-wide 40 percent reduction in methane.

However, the state will still create a regulatory environment to force methane reductions at dairies, despite such collaborative efforts. The SLCP Strategy explains:

In coordination with CDFA and local air quality and water quality agencies, ARB will initiate a rulemaking process to reduce manure methane emissions from the dairy sector consistent with the objectives in this SLCP Strategy. As noted earlier, the rulemaking process will involve extensive stakeholder engagement and consideration of multiple factors. The regulations are to be implemented on or after January 1, 2024.

Pursuant to SB 1383, ARB, in consultation with CDFA, will analyze the progress dairies are making in achieving the goals in the Strategy by July 1, 2020, and may make adjustments to those goals if sufficient progress has not been made.

The rulemaking process will first focus on developing measures to require regulated parties to both report and maintain records covering the parameters that affect GHG emissions at California dairies and other livestock operations. Reported information will be used to refine inventory quantification, evaluate policy effectiveness, assess methane reduction progress, and aid in future policy planning and regulatory development. ARB will work with other State agencies and industry groups to improve outreach on new reporting requirements, as well as merge reporting activities with current forms and requirements to avoid duplicative reporting wherever feasible.

Emission control regulations will be designed to support and complement existing programs. In particular, regulatory requirements to achieve large emission reductions from the sector will affect incentives for methane reduction projects, such as the availability and amount of credits under the Cap-and-Trade Program and LCFS.

The Suggested Efforts To Reduce Methane Emissions From Manure Are Not Yet Cost-Effective Or Viable At This Time.

ARB believes that such efforts can even create “economic value in farming communities.” The SLCP Strategy suggests:

If markets are fully enabled, efforts to reduce methane from manure management at California dairies could lead to billions of dollars of investment and thousands of new jobs, concentrated in the Central Valley. Depending on the strategies pursued to reduce emissions, individual dairies may be able to reduce emissions while generating new revenue streams, and the industry as a whole may be able to meet the targets established in this SLCP Strategy at little or no net cost.

However, ARB recognizes such economic benefits are not a certainty. The SLCP Strategy points out that “revenues in some cases are highly dependent on environmental credit and energy markets, as well as on improving access to the common carrier natural gas pipeline system.” But the state’s regulation of methane emissions will not wait for, or be dependent upon, the achievement of such hypothetical economic benefits. The SLCP Strategy explains that “strategies at dairies that may not include energy production and associated revenues can still reduce emissions at low cost, and may deliver other environmental benefits, as well.” Thus, even if there are no offsetting economic benefits to dairies, the State will pursue the methane reduction plans anyway.

The SLCP Strategy suggests the following manure management changes to reduce methane emissions:

  • “[S]witching from flush water open lagoon systems to anaerobic digesters or other systems such as solid manure management practices.” However, “[s]witching to systems such as solid manure management may lead to air or water quality challenges, however, which need to be fully considered.
  • “[P]asture-based systems may be a viable option, but tradeoffs can limit their feasibility. … For larger dairies and those in the Central Valley, pasturage would require using significantly more irrigated land, may require supplemental feed, and (in the case of Central Valley dairies) may require construction of shade structures and other infrastructure to alleviate heat exposure-related impacts on animal welfare. Pasture dairies may face potential nutrient management and water quality issues, and are required to maintain the capacity to store liquids from milking parlor operations (chilling milk, cleaning facilities, etc.) for a 100-year stormwater event. Additionally, milk production and feed efficiencies are lower in pasture systems, requiring more cows to produce the same amount of milk. Pasture systems also limit the ability to manage manure as a valuable organic waste resource.”
  • “[C]apturing and utilizing manure methane by installing an anaerobic digestion system is more advantageous than avoiding methane emissions through conversion to practices such as a pasture-based dairy model, providing the current barriers can be sufficiently addressed. Captured biogas from dairy manure can be used to power farm trucks and equipment, upgraded for injection into natural gas pipelines, used as a transportation fuel, or used to generate on-site renewable electricity and heat. However, tapping into this resource in California has been complicated in part due to air quality constraints, especially in the Central Valley and Southern California. … [M]anure-management conversions that produce electricity and vehicle fuel are potentially profitable; however, most require significant up-front capital investment.”

Such technologies do not yet exist. The SLCP Strategy recognizes that “some potentially effective strategies are still in the development stage.” Also, ARB recognizes many of these manure management strategies are not cost-effective at this time. The SCLP Strategy explains:

In many cases, converting to solid manure management systems or installing anaerobic digesters at dairies may not yet be cost-effective if the only marketable products are renewable electricity and/or renewable natural gas. If these revenue streams can be augmented with revenues from compost or other soil amendment products, and from environmental credits, these conversions may offer attractive rates of return for farmers and investors. However, markets for these other products need further support before they can offer returns that are reliable enough to help secure project financing.

Strategies to Reduce Emissions From Dairy Cow Burping Are Not Yet Available.

Nearly 20% of the State’s methane emissions come from enteric fermentation (mostly belching) of dairy cows. Such methane is created by microorganisms involved in the digestive processes in the stomachs of dairy cows. While the SLCP Strategy suggests that it is “important to explore strategies to reduce emissions from these sources to meet the State’s 40% economy-wide methane emission reduction target,” the ARB also recognizes that “development of effective control measures face a unique set of challenges.” In fact, “cost-effective and scientifically validated methods for reducing enteric emissions” are not even available at this time. Therefore, the state will “support and monitor research and explore voluntary, incentive-based approaches to reduce enteric fermentation emissions from dairy and non-dairy livestock sectors until cost-effective and scientifically-proven methods to reducing these emissions are available and regulatory actions can be evaluated.”

The Dairy Industry Views The Methane Emission Reduction Strategy As An Existential Threat.

It is not known how the methane reduction that is mandated by SB 1383 will be met. As one agribusiness professor at Cal Poly San Luis Obispo commented: “I really don’t know how they will go about reducing methane emissions by 40 percent.” The general manager of an agricultural trade group concluded that the ARB’s methane plan “threatens the future of the California dairy industry,” and the 40% reduction means “[w]e’re just going to see less dairy in this state”. As one farmer in Sacramento County noted: “In the dairy business, the margins are so slim that something like this will force us out of state.” Dairy farmers complain that the new law, and the money and equipment needed to comply with it, could have a severe economic impact in conjunction with low milk prices, rising labor costs and drought. Methane digesters cost several hundred thousand dollars or more; and although the state has set aside $50 million to help dairies set up digesters, farming groups note that this sum is not nearly enough to equip the state’s roughly 1,500 dairies. Also, digesters require considerable upkeep, and they emit other pollutants like nitrogen oxide and particulate matters, which environmental groups are also targeting for reduction. Thus, as the Wall Street Journal points out: “[T]he regulators acknowledge that most ideas involve environmental trade-offs and are not cost-effective without substantial government subsidies and regulatory credits that can be sold to fossil-fuel producers.” An official with Western United Dairymen concluded that the methane reduction requirements “just makes it more challenging. We’re continuing to lose dairies. Dairies are moving out of state to places where the costs don’t exist.”

Glen Hansen is Senior Counsel at Abbott & Kindermann, Inc. For questions relating to this article or any other California land use, real estate, environmental and/or planning issues contact Abbott & Kindermann, Inc. at (916) 456-9595.

The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, Inc., or the formation of a lawyer/client relationship. Because of the changing nature of this area of the law and the importance of individual facts, readers are encouraged to seek independent counsel for advice regarding their individual legal issues.

In 2016, U.S. Supreme Court Justice Clarence Thomas issued this warning about legislative exactions: “Until we decide this issue, property owners and local governments are left uncertain about what legal standard governs legislative ordinances and whether cities can legislatively impose exactions that would not pass muster if done administratively.” He stated there are “compelling reasons for resolving this conflict at the earliest practicable opportunity.” Abbott & Kindermann Inc.’s Senior Counsel, Glen Hansen, proposes a resolution to that conflict in his recently-published article, Let’s Be Reasonable: Why Neither Nollan/Dolan nor Penn Central Should Govern Generally-Applied Legislative Exactions After Koontz, 34 Pace Envtl. L. Rev. 237 (2017).

In that article, Mr. Hansen explains why the level of constitutional scrutiny that was developed by the U.S. Supreme Court in Nollan v. California Coastal Commission, and Dolan v. City of Tigard, should not apply to legislatively imposed exactions, provided that such exactions satisfy two key criteria: (1) The exaction is generally-applied; and (2) the exaction is applied based on a set legislative formula without any meaningful administrative discretion in that application. He argues that legislative exactions that fail to meet those two criteria should be governed by the Nollan/Dolan standard of review in the same manner as the ad hoc adjudicative exaction in Koontz v. St. Johns River Water Management District. Mr. Hansen then argues that legislative exactions that satisfy those two criteria also should not be governed by the ad hoc factored analysis in Penn Central Transportation Co. v. New York City. Instead, Mr. Hansen argues, a “reasonable relationship” test should be applied to legislative exactions that satisfy those two criteria.

The issue addressed in the article is timely and in need of resolution by the courts. In early 2016, Supreme Court Justice Clarence Thomas explained: “For at least two decades, however, lower courts have divided over whether the Nollan/Dolan test applies in cases where the alleged taking arises from a legislatively imposed condition rather than an administrative one. That division shows no signs of abating.” Justice Elena Kagan similarly opined that, following the Koontz decision, there is now a “cloud on every decision by every local government” that requires a person seeking a permit to pay or spend money. Mr. Hansen’s article offers a practical resolution of that constitutional conflict based on the majority and dissenting opinions in Koontz, as well as the various rationales presented in lower court decisions that have squarely addressed the issue.

Mr. Hansen’s article can be found online at http://digitalcommons.pace.edu/cgi/viewcontent.cgi?article=1803&context=pelr .

Glen Hansen is Senior Counsel at Abbott & Kindermann, Inc. For questions relating to this article or any other California land use, real estate, environmental and/or planning issues contact Abbott & Kindermann, Inc. at (916) 456-9595.

The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, Inc., or the formation of a lawyer/client relationship. Because of the changing nature of this area of the law and the importance of individual facts, readers are encouraged to seek independent counsel for advice regarding their individual legal issues.

By William W. Abbott

Friends of the College of San Mateo Gardens v. San Mateo County Community College District  (2017) 11 Cal.App.5th 596

In the follow up decision to the Supreme Court’s decision in Friends of the College of San Mateo Gardens v. San Mateo County Community College District (2016) 1 Cal.5th 937 (San Mateo Gardens), the appellate court invalidated the District’s reliance upon the addendum to the previously adopted negative declaration. There was sufficient evidence to support the lead agency’s decision to rely upon CEQA’s subsequent review provisions, but there was also sufficient evidence brought by the petitioner to support a fair argument to set aside the use of an addendum, requiring that the addendum be set aside.

As readers may remember from our review of the Supreme Court’s decision in San Mateo Gardens, the Court articulated a deferential approach to a local government’s determination that an earlier CEQA document retained ongoing relevance for later use. In the facts of San Mateo Gardens, the District proposed to modify a previously approved master plan, relying upon an addendum to an earlier negative declaration. Finding that it was a “new” project, the appellate court had reversed the District’s reliance upon an addendum. The Supreme Court declined to follow the new project/old project line of inquiry, concluding that the appropriate judicial inquiry was whether or not there was substantial evidence to support the lead agency’s reliance upon the earlier CEQA document, the consequence of which would be to then apply CEQA’s subsequent review requirements (Public Resources Code section 21166) as compared to starting all over.

Following the Supreme Court decision, the court of appeal found that in fact, substantial evidence supported the District’s reliance to not start the CEQA process afresh, but to rely upon CEQA’s subsequent review provisions. As the project’s latest changes did not affect the 2006 decision and MND to demolish 14 buildings and the previously established mitigation measures, there was continuing utility to the 2006 decision and related environmental analysis. In these circumstances, the lead agency’s decision to employ the subsequent review procedures in CEQA was justified. This, however, was only the first issue to be addressed by the reviewing court.

A lead agency and a reviewing court must then address what type of CEQA document is then appropriate. The appellate court recognized the Supreme Court’s distinction between the circumstances in which an EIR as compared to a negative declaration is the relied upon document. Following an initial EIR, a lead agency (and court) can employ the deferential substantial evidence test. When the initial CEQA document is a negative declaration, the less deferential fair argument test applies to the subsequent CEQA documentation and the agency’s conclusions that major revisions are not required to the first CEQA document.

The scope of inquiry surrounding the subsequent CEQA document is not an invitation, however, to go back to the project starting line, as the relevant scope of analysis is appropriately focused on the changes in the project.

Applying the college master plan and the anticipated project changes, the evidence of potential impacts largely involved alleged aesthetic impacts, recognized by the court as subjective in character and requiring no specific expertise. Thus testimony by students and professors, none of which reflected any training in aesthetics rose to the level of a fair argument. Although the amount of landscaping to be removed when evaluated in the context of the entire campus was very limited, the appellate court subscribed to the appellant’s argument of micro-defining the relevant environment to small areas within the master plan. [Apparently, while CEQA requires the lead agency to look at the whole of the project an opponent is not so similarly burdened.]    All was not lost for the lead agency, as the appellate court held that upon remand, the District could utilize a negative declaration in circumstances in which potential impacts were mitigated to a less than significant level.

The bottom line? I think that the ongoing benefit of an EIR as the initial CEQA document for a project is readily demonstrated by this decision. The court’s decision is helpful that the scope of inquiry is limited to changes in the project when compared to the original approval. Thus the CEQA clock is not reset at zero. The circumstances in which an addendum is appropriate is limited to “minor technical changes or corrections.” In reaching this conclusion, the court left open the door that the District may be able to employ a mitigated negative declaration in circumstances (following the initial negative declaration) in which the potential impacts can be mitigated to a level of less than significant. Thus, the CEQA burden for the follow up negative declaration is lessened when compared to a negative declaration in the first instance. Perhaps it is better the second time around; it’s just not as great as it could have been.

William W. Abbott is shareholder at Abbott & Kindermann, Inc. For questions relating to this article or any other California land use, real estate, environmental and/or planning issues contact Abbott & Kindermann, Inc. at (916) 456-9595.

The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, Inc., or the formation of a lawyer/client relationship. Because of the changing nature of this area of the law and the importance of individual facts, readers are encouraged to seek independent counsel for advice regarding their individual legal issues.

By William W. Abbott, Diane Kindermann, Glen Hansen, Brian Russell and Dan Cucchi

Welcome to Abbott & Kindermann’s 2017 1st Quarter CEQA update. This summary provides links to more in depth case write-ups on the firm’s blog. The case names of the newest decisions start with Section 3 and are denoted by bold italic fonts.

1.         2016 CEQA UPDATE

To read the 2016 cumulative CEQA review, click here:

2.         CASES PENDING AT THE CALIFORNIA SUPREME COURT

There are 4 CEQA cases pending at the California Supreme Court. The cases, listed newest to oldest, and the Court’s summaries are as follows:

Union of Medical Marijuana Patients, Inc. v. City of San Diego, S238563. (D068185; 4  Cal.App.5th 103; San Diego County Superior Court; 37-2014-00013481- CU-TT-CTL.) Petition for review after the Court of Appeal affirmed the judgment in an action for administrative mandate. This case presents the following issues: (1) Is the enactment of a zoning ordinance categorically a “project” within the meaning of the California Environmental Quality Act (Pub. Resources Code, § 21000 et seq.)? (2) Is the enactment of a zoning ordinance allowing the operation of medical marijuana cooperatives in certain areas the type of activity that may cause a reasonably foreseeable indirect physical change to the environment?

Cleveland National Forest Foundation v. San Diego Assn. of Governments, S223603. (D063288; 231 Cal.App.4th 1056, mod. 231 Cal.App.4th 1437a; San Diego County Superior Court; 37-2011-00101593-CU-TT-CTL, 37-2011-00101660-CU-TTCTL.) Petition for review after the court of appeal affirmed the judgment in a civil action. The court limited review to the following issue: Must the environmental impact report for a regional transportation plan include an analysis of the plan’s consistency with the greenhouse gas emission reduction goals reflected in Executive Order No. S-3-05, so as to comply with the California Environmental Quality Act (Pub. Resources Code, § 21000 et seq.)?

Friends of the Eel River v. North Coast Railroad Authority, S222472. (A139222; 230 Cal.App.4th 85; Marin County Superior Court; CV1103591, CV1103605.) Petition for review after the court of appeal affirmed the judgments in actions for writ of administrative mandate. This case includes the following issues: (1) Does the Interstate Commerce Commission Termination Act [ICCTA] (49 U.S.C. § 10101 et seq.) preempt the application of the California Environmental Quality Act [CEQA] (Pub. Resources Code, § 21050 et seq.) to a state agency’s proprietary acts with respect to a state-owned and funded rail line or is CEQA not preempted in such circumstances under the market participant doctrine (see Town of Atherton v. California High Speed Rail Authority (2014) 228 Cal.App.4th 314)? (2) Does the ICCTA preempt a state agency’s voluntary commitments to comply with CEQA as a condition of receiving state funds for a state owned rail line and/or leasing state-owned property?

Sierra Club v. County of Fresno, S219783. (F066798, 226 Cal.App.4th 704; Fresno County Superior Court; 11CECG00706, 11CECG00709, 11CECG00726.) Petition for review after the court of appeal reversed the judgment in an action for writ of administrative mandate. This case presents issues concerning the standard and scope of judicial review under the California Environmental Quality Act. (CEQA; Pub. Resources Code, § 21000 et seq.)

3.         UPDATE

Banning Ranch Conservancy v. City of Newport Beach (March 30, 2017, S227473) ___Cal.5th ___.

Petitioners sued the City of Newport Beach over the approval of a residential and commercial project on one quarter of a 400-acre, largely undeveloped coastal property.  The petitioners objected to the City’s EIR, arguing it failed to identify potential impacts to “environmentally sensitive habitat areas” (“ESHA”), defined by the California Coastal Act, as a result of the project.  The Coastal Commission had not yet determined whether ESHAs were present at the site and the site was explicitly excluded from the City’s coastal land use plan.  Petitioners also challenged the project on general plan consistency grounds, asserting that the County had failed to adequately “work with” the Coastal Commission to identify wetlands and habitats. The appellate court held that the City was not required to speculate as to the presence of ESHAs at the site in its EIR, because it is a legal conclusion to be made by the Coastal Commission.  Instead, the City’s EIR analysis was sufficient because it included all of the necessary data and analysis regarding biological resources and habitat. The court also found the project was consistent with the City’s general plan because the City could work with the Commission post-approval when it obtains the necessary coastal development permit.  Petitioners appealed and the California Supreme court granted the petition for review.

The California Supreme Court reversed.  It held that CEQA’s requirement to concurrently integrate CEQA compliance with other related review procedures “required by law or by local practice” (CEQA Guidelines §15080), obligated the City to include at least some analysis of the impacts to known and potential ESHAs present on the site.  It found the City’s reasoning for deferring the analysis was not persuasive, given the “ample evidence that ESHA are present on Banning Ranch.” As for the general plan consistency claim, the Court decided it need not address the issue, holding it was unnecessary as sufficient relief was already granted under CEQA.

Aptos Council v. County of Santa Cruz (March 30, 2017, H042976) ___Cal.App.5th ___.

The County of Santa Cruz, as part of its plan to overhaul its zoning ordinance, adopted three separate ordinance amendments to: (1) expand the minor exceptions to the zoning site standards; (2) alter the height, density, and parking requirements for hotels in its commercial districts; and (3) adopted an administrative approval process for some minor exceptions to the sign ordinance.  The County relied on a negative declaration for each of the first two amendments and found the third amendment was exempt. In each case, the County considered them separate and distinct projects under CEQA. The Aptos Council challenged the approvals, arguing the County had improperly “piecemealed” the CEQA evaluation for the projects by failing to consider them as a single project.  In addition, the Council challenged the negative declaration for the hotel amendment, arguing the CEQA analysis failed to consider the impacts of future development that would be permitted by the ordinance. Affirming the trial court, the appellate court denied the Council’s petition. It rejected the Council’s claim that the County improperly piecemealed the CEQA analyses for each amendment, because, as stated in Banning Ranch Conservancy v. City of Newport Beach, 211 Cal.App.4th 1209 (2012), each amendment could be “implemented independently.” As to the hotel amendment, the court found that the County’s analysis properly considered some potential impacts of future development, but concluded that additional impacts described by the Council were speculative and, thus, were not a reasonably foreseeable consequence of the amendment.

Residents Against Specific Plan 380 v. County of Riverside (February 14, 2017, E063292) ___ Cal.App.5th ___.

Riverside County approved a specific plan and related regulations for a mixed-use project located on 200 acres. The specific plan, as modified by the Board of Supervisors prior to its approval, included seven planning areas with different allocations of allowed land uses. The EIR analyzed a project consisting of eight planning areas with different land use allocations across the project site than the adopted specific plan. Among other commenters, the air district and a nearby city both suggested mitigation measures to reduce air quality impacts in comments on the Draft EIR. Additional noise mitigation measures were also proposed during the final hearing before the Board. The Final EIR included responses to comments, including those of the air district and nearby city, but as to those comments concluded that the proposed mitigation measures were infeasible. The petitioners filed suit and the trial court denied the claims. The petitioners appealed.

The appellate court denied the appeal, rejecting the arguments of multiple CEQA claims, finding: (1) there were no procedural errors concerning the County’s practice of passing a motion of intent to approve and the later final approval; (2) EIR recirculation was not required because the decision not to recirculate due to the changes in the project was supported by substantial evidence; (3) errors in the notice of determination were not prejudicial; (4) there was sufficient evidence in the record to support rejection of suggested mitigation measures; and (5) the County had no duty to formally respond to late comments.

If you have any questions about these court decisions, contact William Abbott, Diane Kindermann or Daniel Cucchi. The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, Inc. nor the formation of a lawyer/client relationship. Because of the changing nature of this area of the law and the importance of individual facts, readers are encouraged to seek independent counsel for advice regarding their individual legal issues.

By William W. Abbott

The White House puts punitive zoning regulations under the magnifying glass.

In his latest Saturday morning tweet, POTUS signaled that his love affair with local government was over. “Local government is worst enemy to making America great again. So sad. #Ihatezoning” it read. The White House released the follow-up statement. “The President is responding to news stories that local zoning regulations are impeding economic growth by imposing needless regulations. The President is working on an executive order which would cut off federal funding to cities and counties which implement restrictive zoning. The White House and Justice Department will assemble a team to closely review local zoning regulations. This is another example of overregulation standing in the way of economic progress and the President intends upon exercising every legal authority available to him to shake things up as he promised the voters when he ran for president.”

At the White House press briefing later that morning, a reporter pointed out that the only news story in the last six months involving local zoning and economic growth was a page 7 story in the National Inquirer. Sean Spicer testily responded “Look blockhead. We don’t make the news. We only respond to what you clowns write. What a pathetic life you all have spending all of your waking hours dreaming up ways to criticize the President. #gogetarealjob #gocrymeariver. Next?” Mr. Spicer went on to point out that the President had spent a lifetime battling with local governments and was an expert in the field, a first for any US President.

William W. Abbott is a shareholder at Abbott & Kindermann, Inc. For questions relating to this article or any other California land use, real estate, environmental and/or planning issues contact Abbott & Kindermann, Inc. at (916) 456-9595.

The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, Inc., or the formation of a lawyer/client relationship. Because of the changing nature of this area of the law and the importance of individual facts, readers are encouraged to seek independent counsel for advice regarding their individual legal issues.

 

Appellate court rejects arguments of multiple CEQA claims of procedural error concerning EIR recirculation, error in the notice of determination, insufficient rejection of suggested mitigation measures, and failure to consider late comments.

Residents Against Specific Plan 380 v. County of Riverside (February 14, 2017, E063292) ___ Cal.App.5th ___.

By William W. Abbott

A trial court and the court of appeal declined to overturn the certification of an EIR and approval of a specific plan and related land use entitlements. The legal claims touch upon a number of common procedural objections leveled at local approvals and describes how one local government successfully overcame them.

In Riverside County, an applicant brought forward a specific plan and related regulations for a mixed-use project located on 200 acres. The specific plan, as approved, included seven planning areas with different allocations of allowed land uses. The County circulated a Draft Environmental Impact Report (“DEIR”) from August 8 to September 26, 2011. The DEIR analyzed a project consisting of eight planning areas, one more than was ultimately approved, with different land use allocations across the project site than the adopted specific plan. The DEIR identified two significant and unavoidable impacts: air quality and noise. Among other commenters, the air district and nearby city both suggested mitigation measures to reduce air quality impacts. The air district’s comments focused on vehicle fleet mix and related equipment and the city recommended that the DEIR’s mitigation measure (which required compliance with the 2008 Title 24 Energy Codes) be updated to reflect the 2010 codes and the 2010 California Green Building Standards, and include requirements for attic fans, whole house fans, PV panels and solar hot water systems.

The County released the Final EIR (“FEIR”) in January 2012, and the FEIR was based upon the proposed project with the eight planning areas. The FEIR included responses to comments, including those of the air district and nearby city, but as to those comments concluded that the proposed mitigation measures were infeasible.

As is common, the Planning Commission modified the specific plan during its deliberations. County staff and its consultants confirmed for the Commission that the changes were not significant for CEQA purposes and that recirculation was not required. On December 11, 2012, the Board of Supervisors began its deliberations. The day before the meeting, counsel for the petitioner submitted comments, reiterating the suggested mitigation measures proposed by the air district and nearby city. At its hearing, the Board also modified the specific plan. The changes left the plan boundaries intact and did not change the total number of residential units or maximum non-residential uses. Staff and the consultants again confirmed that the changes to the plan did not create new or substantially increase the severity of impacts, thus concluding that recirculation of the EIR was not required. The Board then passed a motion of intent to certify the EIR and approve the entitlements. Staff worked with the applicant and the revised final documents returned to the Board for final action in November 2013. Following approval by the Board, the petitioner filed suit. The trial court ruled for the County and Real Party in Interest, and petitioner appealed.

The Court of Appeal faced six procedural objections which occur with some frequency in CEQA proceedings:

First, the appellate court held that the Board had not modified the project after approval. The appellant argued that the project was approved by the December motion. Not so according to the court. The court recognized the common practice of passing a motion of intent to approve and the later final approval. This meant that the final changes to the land use documents occurred before final action, not afterwards as argued by the petitioner.

Second, consistent with the court’s analysis of the effect of the motion of intent, the CEQA findings and statement of overriding considerations were adopted in conjunction with the final motion for adoption, and were not adopted after-the-fact as argued by the project opponents.

Third, the appellant claimed that the Notice of Determination (“NOD”) was invalid as it included an erroneous description based upon the earlier version of the project. The court found no prejudicial error, as the remedy for failure to provide a legally sufficient NOD is the expansion of the applicable statute of limitations to 180 days and the petitioner had timely filed the lawsuit.

Fourth, the appellate court also rejected the argument that recirculation was required. It found the record of proceedings included the required supporting analysis that recirculation was not required. Factually, although land uses were adjusted within the overall specific plan, the maximum intensities had not changed. That fact, coupled with the consultant and staff analysis and a limitation that any substituted future use could not create any additional impacts than those already documented in the EIR, was sufficient to support the County’s decision to not recirculate.

Fifth, the Court said substantial evidence supported the County’s decision to not add the recommended mitigation measures. As to the vehicle fleet mix requirements, staff concluded that it was not feasible based upon the developer’s expressed concerns over the availability of the new less polluting equipment. As to the energy efficiency standard, the County’s response had been that the developer in any event would have to comply with the energy standards then required by the State of California. As to the Green Energy Standards, staff found it was infeasible as it would conflict with the performance standards set by the County. As the County’s preference was for flexibility for the developer rather than a list of prescriptive measures, the specific mitigation measure was not feasible.

Finally, as to the suggested noise mitigation measure submitted the day before the Board undertook its deliberations, the Court noted that the comment was submitted fourteen months after the close of the comment period. Thus, it held the Board was not required to adopt any findings of infeasibility or to even consider the comment.

William W. Abbott is shareholder at Abbott & Kindermann, Inc. For questions relating to this article or any other California land use, real estate, environmental and/or planning issues contact Abbott & Kindermann, Inc. at (916) 456-9595.

The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, Inc., or the formation of a lawyer/client relationship. Because of the changing nature of this area of the law and the importance of individual facts, readers are encouraged to seek independent counsel for advice regarding their individual legal issues.

By Daniel S. Cucchi

City of San Jose v. Superior Court (March 2, 2017, S218066) ___ Cal.5th ___.

Citing the need to broaden the definition of “public records” to address the “evolving methods of electronic communication,” a unanimous California Supreme Court reversed the Sixth District Court of Appeal, holding that communications related to the “conduct of the public’s business” by agency officials and employees on their personal accounts are subject to disclosure under the California Public Records Act (“CPRA”).

In June 2009, the petitioner filed a CPRA request with the City of San Jose (the “City”), which included the City’s redevelopment agency, certain elected officials and staff, for all documents related to redevelopment efforts in the City’s downtown.  The request for documents included “emails and text messages ‘sent or received on private electronic devices used by’ the mayor, two city council members, and their staff.”  The City refused to provide the information on private electronic devices, stating that they were not public records, because the emails and texts were not within the City’s custody or control.  Petitioner filed suit and the trial court ordered disclosure.  The City appealed and the appellate court reversed.  The California Supreme Court granted the petition for review.

Seeking to balance the public’s right to know enshrined within the CPRA and the California Constitution against an individual’s right to privacy, the Court outlined a standard intended to avoid an interpretation that “would allow evasion of the CPRA simply by the use of a personal account,” while limiting disclosure of private communications to only those that involve substantive discussions of public matters.  While recognizing the standard cited in San Gabriel Tribune v. Superior Court (1983) 143 Cal.App.3d 762, 774, which normally excludes only communications “totally void of reference to governmental activities” under the CPRA, the Court distinguished the context of communications sent through personal accounts, reasoning that this broad standard would likely sweep up more than necessary to comply with the CPRA.  Instead, the Court laid out a less exacting standard that these communications “must relate in some substantive way to the conduct of the public’s business” before they become a public record.  Thus, incidental mentions of a public matter would normally be insufficient to trigger disclosure.

The City also claimed that the private communications were not a public record because they were not “prepared, owned, used, or retained” by the City, nor were they accessible to, or retained by, the City.  The Court rejected this interpretation of the statute, reasoning that (1) agencies, much like corporations, can only act through its officials, and (2) the City still had constructive control over the records because its own officials and employees had access to those records.  It further noted that to conclude otherwise would allow an agency to avoid disclosure by transferring custody to a third party, or even its own employees.  The Court concluded by reviewing the various exemptions available to protect the privacy of officials and employees, including preliminary and draft notes and memoranda (Gov. Code §6254(a)), personal financial data (Id. §6254(n)), as well as the “catchall” exemption when the public interest in withholding “clearly outweighs” the public interest in disclosure (Id. §6255(a)).

In the age of technology and instant communications, it can be easy for agency officials to grab their phone to send that text or email, particularly when they do not have a device issued by the agency. Whether or not such communications were ever intended to avoid disclosure, the Court’s decision puts to rest any question that substantive communications about public matters will be considered a public record. Agencies can best avoid these complex and costly issues by establishing clear technology policies strongly discouraging use of private communication systems for public matters and, at a minimum, issuing phones and/or other similar devices to those agency officials that are most likely to generate electronic communications for agency business outside of the office.  And of course, there are always the very old school options of simply picking up the telephone or a face-to-face conversation.

Daniel S. Cucchi is an associate at Abbott & Kindermann, Inc.  For questions relating to this article or any other California land use, real estate, environmental and/or planning issues contact Abbott & Kindermann, Inc. at (916) 456-9595.

The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, Inc., or the formation of a lawyer/client relationship. Because of the changing nature of this area of the law and the importance of individual facts, readers are encouraged to seek independent counsel for advice regarding their individual legal issues.

 

By Daniel S. Cucchi

Hernandez v. Town of Apple Valley (2017) 7 Cal.App.5th 194

In 2011, the Town of Apple Valley (the “Town”) circulated a local initiative called the “Wal-Mart Initiative Measure,” or in some cases the “Wal-Mart Supercenter Ballot Initiative,” which was subsequently declared null and void. Two years later, the Town noticed a city council agenda item for a “Wal-Mart Initiative Measure” with a recommended action to “provide direction to staff.”  Petitioner did not attend the council meeting believing the matter was follow-up activities related to the 2011 measure.  He later learned that the Town council had adopted two resolutions for a new voter initiative for a proposed 30-acre commercial development that included a new Wal-Mart Supercenter, as well as a Memorandum of Understanding (“MOU”) to accept a gift from Wal-Mart to pay for the special election. After filing a request with the Town to cure the alleged agenda defect, which the Town rejected, Petitioner filed suit arguing the Town violated the Ralph M. Brown Act and that the initiative measure itself violated California Constitution, article II, section 12’s prohibition against specifically naming any individual or corporation to “perform any function or to have any power or duty….”  The trial court granted petitioner’s Motion for Summary Judgment on both claims, finding the MOU and the initiative were void and invalid.  The Town and Wal-Mart appealed.

The appellate court first considered the Brown Act claim, finding that while the resolutions calling for the special election were properly noticed, the Town’s adoption of the MOU was not, creating a fatal flaw in the approval of all of the resolutions. The Town argued that the agenda packet included all of the relevant information regarding the proposed initiative, but the court was not persuaded. While choosing not to rule on the question of whether information in an agenda packet can be used to bring an agency into compliance with the Brown Act, it noted that the record showed that the MOU resolution was added to the agenda item after release of the agenda.  This was fatal, the court reasoned, because it was reasonable to conclude the MOU was “a major factor in the decision to send the matter to the electorate.”  Thus, since the MOU resolution was improperly noticed, the resolutions to place the initiative measure on the ballot were null and void as a result.

Anticipating the likelihood that the initiative measure would likely return to the ballot, the court next turned to the question of whether the measure violated the California Constitution. Petitioner argued that although Wal-Mart was not specifically named in the initiative text, the ballot measure materials clearly established that approval would grant powers to the owner and developer, Wal-Mart.  The court disagreed.  It held that the initiative was properly drafted, even though it ultimately benefitted Wal-Mart, because the text of the initiative did not specifically name Wal-Mart.  It reasoned that the use of the words “developer” and “owner” in the initiative meant that if Wal-Mart were to sell the property, it would retain no superior rights in the property over the subsequent owner.  Thus, Wal-Mart’s current beneficial position was granted by ownership of the subject property and not by the initiative itself.

Daniel S. Cucchi is an associate at Abbott & Kindermann, Inc.  For questions relating to this article or any other California land use, real estate, environmental and/or planning issues contact Abbott & Kindermann, Inc. at (916) 456-9595.

The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, Inc., or the formation of a lawyer/client relationship. Because of the changing nature of this area of the law and the importance of individual facts, readers are encouraged to seek independent counsel for advice regarding their individual legal issues.