Reserve your seat for one of three seminars taking place in early 2020.

In January and February 2020 Abbott & Kindermann, Inc. will present its 19th annual educational program for clients and colleagues interested in current land use, environmental, and real estate issues affecting commercial and residential development, agriculture, real estate transactions, easements, mining and the construction materials production industry.

A summary of 2019 case law and legislative updates includes the following hot topics for 2020:

  • Air Quality and Climate Change: including CEQA Guidelines and Mandatory Reporting
  • Mining
  • Updating Land Use Entitlements
  • Endangered Species
  • Water Quality and Wetlands
  • Water Rights and Supply
  • Cultural Resources
  • Renewable Energy
  • Environmental Enforcement
  • Hazardous Substance Control and Cleanup
  • Timber Resources
  • CEQA:  Exemptions, Baseline, Greenhouse Gases and Climate Change
  • CEQA Litigation
  • Real Estate Acquisition and Development

Abbott & Kindermann, Inc. will present its annual program at three locations: Redding, Modesto and Sacramento.  Details for the seminars are below.  We hope you can join us and we look forward to seeing you there.

Redding Conference  (To Register for the Redding Location Click Here)

Date: Thursday, January 16, 2020

Location: Hilton Garden Inn Redding, 5050 Bechelli Lane, Redding, CA

Registration: 12:30 p.m. – 1:00 p.m.

Program: 1:00 p.m. – 4:00 p.m.

Modesto Conference  (To Register for the Modesto Location Click Here)

Date: Thursday, January 23, 2020

Location: Double Tree Hotel Modesto, 1150 Ninth Street, Modesto, CA

Registration: 12:30 p.m. – 1:00 p.m.

Program: 1:00 p.m. – 4:30 p.m.

Sacramento Conference  (To Register for the Sacramento Location Click Here)

Date: Thursday, January 30, 2020

Location: Sacramento Hilton Arden West, 2200 Harvard Street, Sacramento, CA

Registration: 8:30 a.m. – 9:00 a.m. with continental breakfast

Program: 9:00 a.m. – 12:00 noon

The registration fee for the program is $95.00. Please register early to reserve your seat. Select the links above to see registration details for each location, as they differ. MCLE and AICP CM credits are available (approval pending).

Please call (916) 456-9595 with any questions.

By William W. Abbott & Kristen Kortick

City of Hesperia v. Lake Arrowhead Community Services District (2019) 37 Cal.App.5th 734.

In City of Hesperia v. Lake Arrowhead Community Services District (2019) 37 Cal.App.5th 734, the 4th  Appellate District affirmed a writ of mandate issued to Lake Arrowhead Community Services District (“District”) directing the District to set aside the District’s approval of a solar energy project (“the Project”). The District proposed the Project in a location inconsistent with local zoning. The District, relying upon its status of an agency potentially exempt from local zoning, moved forward with preparation of a mitigated negative declaration (“MND”) and findings. The City provided comments that the Project required a general plan amendment and zoning change, and that it conflicted with Hesperia Municipal Code Section 16.16063.B. Thereafter, the District approved an energy services agreement with SunPower Corporation and generator interconnection agreement with Southern California Edison for the energy generation resulting from the Project. The District held a public hearing on the Project, found the Project exempt from local zoning and approved the Project with a 4/5ths vote over the City’s repeated objections. The District maintained that its Project was exempt from local zoning by virtue of Government Code §§ 53091 and 53096(a). In the ensuing litigation, the trial court and appellate court rejected the District’s exemption arguments.

The District provides water services to 8,000 water customers and 10,500 wastewater customers. The District discharges its wastewater at a 350-acre site, Hesperia Farms. The District proposed to utilize four to six acres of Hesperia Farms for a solar farm. The location of the proposed solar farm did not comply with the City’s zoning code for such facilities.

The City filed suit against the District seeking a writ of mandate to overturn approval of the Project based upon conflict with the City’s zoning code. The trial court granted the City’s writ of mandate, ruling that the Project was not exempt based upon Gov. Code § 53091(e) and that the administrative record did not support the District’s finding of a qualified exemption under §53096(a) that there was “no feasible alternative to installing the solar farm at any location other than the Project Site.”

The appellate court affirmed the ruling of the trial court holding that transmission of electrical energy does not qualify the Project for an exemption based upon § 53091(e) and the administrative record did not support the District’s finding of no feasible alternatives for the Project location under § 53096(a). The court explained that § 53091(a) states the general rule that each local agency must comply with zoning ordinances based on the city where the facility is located. Gov Code § 53091(e) then provides an exemption for facilities for the “production or generation of electrical agency.” Since the Project included transmission, not just production generation, the court concluded that the District could no longer rely upon the production or generation exemption as exemptions are narrowly construed.

Additionally, the appellate court agreed with the trial court’s determination that the District failed to properly find “no feasible alternatives.” The District argued that if it did not qualify for an exemption under §53091(e) then it qualified under §53096(a) because its findings demonstrated no feasible alternative location for the Project. The appellate court found the administrative record did not contain substantial evidence to support the District’s argument as the District had not considered any alternative project location. As such, the appellate court agreed with the City that the District failed to meet its burden to show that an alternative project location was not feasible. In the absence of substantial evidence in the record regarding alternatives, the District could not rely upon the qualified exemption of §53096(a) to exempt the District from local zoning.

William Abbott is an Attorney at Abbott & Kindermann, Inc.  Kristen Kortick is a Law Clerk 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.

Knick v. Township of Scott, Pennsylvania, ___ U.S. ___, 139 S.Ct. 2162, 204 L.Ed.2d 558 (2019)

On June 21, 2019, by a 5-4 vote, the United States Supreme Court in Knick v. Township of Scott, Pennsylvania overruled the 34-year-old ripeness rule articulated in Williamson County Regional Planning Commission v. Hamilton Bank of Johnson City, 473 U.S. 172 (1985).  Under the Williamson County rule, a property owner whose property had been taken by a local government had not suffered a violation of his Fifth Amendment rights—and thus could not bring a federal takings claim in federal court—until a state court had denied his claim for just compensation under state law.  The majority decision in Knick was written by Chief Justice Roberts and overruled Williamson County, thereby allowing Fifth Amendment takings claims to be filed in federal court without the claimant first having to pursue a state court action.  The Court held: “[A] government violates the Takings Clause when it takes property without compensation, and that a property owner may bring a Fifth Amendment claim under §1983 at that time.”

Williamson County is Overruled.

The underlying facts in the case are that Rose Mary Knick owned 90 acres of rural property that included her single-family home and a small graveyard where the ancestors of her neighbors are allegedly buried.  In 2012, the local Township passed an ordinance requiring that all cemeteries to be kept open and accessible to the general public during daylight hours.  The following year, the Township notified her that Ms. Knick was violating the ordinance by failing to open the cemetery to the public during the day.  She brought a declaratory and injunctive relief action in Pennsylvania state court on the ground that the ordinance effected a taking of her property; however, she did not bring an inverse condemnation action under state law for the alleged taking.  Before the state court action was completed, Ms. Knick filed an action in U.S. District Court under 42 U.S.C. §1983, alleging that the ordinance violated the Takings Clause of the Fifth Amendment.  However, the District Court dismissed Ms. Knick’s takings claim under the ripeness rule articulated in Williamson County.  The Third Circuit Court of Appeals affirmed the District Court’s dismissal in light of that rule.  The United States Supreme Court granted certiorari to reconsider the rule.

The Supreme Court then reversed by overruling the ripeness rule in Williamson County.  The Chief Justice noted that the rule was “unworkable in practice” because it often resulted in property owners being barred from ever bringing takings claims to federal court.  That is because of the Court’s decision 20 years later in San Remo Hotel, L. P. v. City and County of San Francisco, 545 U.S. 323 (2005), which held that a state court’s resolution of a claim for just compensation under state law generally has preclusive effect in any subsequent federal suit.  The upshot of that “preclusion trap sprung by San Remo,” according to the Chief Justice, was that  that “many takings plaintiffs never have the opportunity to litigate in a federal forum that §1983 by its terms seems to provide,” which is a significant consequence that was “not considered by the Court in Williamson County.”  The Chief Justice added that the guarantee of a federal forum under the Civil Rights Act of 1871 “rings hollow for takings plaintiffs, who are forced to litigate their claims in state court.”  Therefore, the state-litigation requirement in Williamson County “imposes an unjustifiable burden on takings plaintiffs, conflicts with the rest of our takings jurisprudence, and must be overruled.”

Jettisoning the state-litigation requirement in Williamson County, the majority then articulated the following procedural rule for takings claims in federal court:

A property owner has an actionable Fifth Amendment takings claim when the government takes his property without paying for it. That does not mean that the government must provide compensation in advance of a taking or risk having its action invalidated: So long as the property owner has some way to obtain compensation after the fact, governments need not fear that courts will enjoin their activities. But it does mean that the property owner has suffered a violation of his Fifth Amendment rights when the government takes his property without just compensation, and therefore may bring his claim in federal court under [42 U.S.C.] §1983 at that time.

So what are the unstated, but possible implications of the Court’s ruling?  At least three come to mind.

“A Mass Of Quintessentially Local Cases Involving Complex State-Law Issues.”

The first unstated, but possible consequence of the Knicks decision will be a dramatic increase in takings claims being filed in federal court, especially in those locales where the federal courts and federal juries are considered to be more favorable to property rights than the state courts.[1]  A significant number of those increased federal claims will likely depend upon the interpretation, determination and/or application of unresolved state property law issues.  In her dissent, Justice Kagan warned about this.  She argued that the majority’s overruling of Williamson County will have the damaging consequence of “subvert[ing] important principles of judicial federalism” because the decision channels “a mass of quintessentially local cases involving complex state-law issues into federal courts.”  She adds that the decision channels to federal courts “a (potentially massive) set of cases that more properly belongs, at least in the first instance, in state courts.”  Justice Kagan pointed out that, unlike other constitutional challenges, a claim that a land-use regulation violates the Takings Clause usually turns on state-law issues:

The question in takings cases is not merely whether a given state action meets federal constitutional standards. Before those standards can come into play, a court must typically decide whether, under state law, the plaintiff has a property interest in the thing regulated. [Citations.]  Often those questions—how does pre-existing state law define the property right?; what interests does that law grant?; and conversely what interests does it deny?—are nuanced and complicated. And not a one of them is familiar to federal courts.

For example, Justice Kagan explained that, in Knick “it is first necessary to address an issue about background state law” in order to answer the “ultimate constitutional question” in that case.  She admitted that neither she nor “my colleagues on the federal bench” know the answer to the underlying state law issue in Knick.  But, she added, “under today’s decision, it will be the Federal District Court for the Middle District of Pennsylvania that will have to resolve this question of local cemetery law.”  Justice Kagan argued that “[s]tate courts are—or at any rate, are supposed to be—the ‘ultimate expositors of state law,’” and “the corollary is that federal courts should refrain whenever possible from deciding novel or difficult state-law questions.”

Citing Railroad Commission of Texas v. Pullman Co., 312 U.S. (1941), Justice Kagan pointed out that, under the principle of judicial federalism, “this Court has promoted practices of certification and abstention to put difficult state-law issues in state judges’ hands.”  But, she added, “[w]e may as well not have bothered” because the majority decision “sends a flood of complex state-law issues to federal courts. It makes federal courts a principal player in local and state land-use disputes.”

While Justice Kagan’s concern about a flood of new federal takings cases is well-founded, her concern about federal involvement in local and state land use decisions will likely be alleviated by a robust application by the federal courts of Pullman abstention.  Justice Kagan accurately highlighted the prevalence of state law issues in several cases, including Lucas v. South Carolina Coastal Council, 505 U.S. 1003 (1992).  (Indeed, she could have also pointed to the recent case of Muir v. Wisconsin, ___ U.S. ___, 137 S. Ct. 1933 (2017), where the Supreme Court held that, for purposes of determining whether a regulatory taking has occurred under the multifactored standard in Penn Central Transp. Co. v. New York City, 438 U.S. 104 (1978), that petitioners’ property should be evaluated as a single parcel because, among other reasons, “the treatment of the property under state and local law indicates petitioners’ property should be treated as one when considering the effects of the restrictions.”  (Emphasis added.))  As a land use practitioner, this author has seen many takings challenges against local agency actions that are based on questionable allegations that property owners have certain state law property rights that the governmental action allegedly took away or unduly infringed upon.  So, Justice Kagan is correct in asserting that takings claims often depend upon the existence or extent of an alleged property right under state law.

So, in the likely result that many more (“potentially massive”) takings claims will now be filed in the U.S. District Courts, how will federal judges handle the disputed state law property questions that will likely be at the heart of many of those claims?  Justice Kagan cited certification and abstention doctrines, such as those applied in Lousiana Power & Light Co. v. City of Thibodaux, 360 U.S. 25 (1959), as a means of putting difficult state-law issues in state judges’ hands.

The certification process may be available in cases involving significant unresolved questions of state law.  For example, in Kremen v. Cohen, 325 F.3d 1035 (9th Cir. 2003), the Ninth Circuit certified the question to the California Supreme Court under Rule 29.5(a) of the California Rules of Court of whether an Internet domain name is within the scope of property subject to the tort of conversion?  While the Ninth Circuit stated that “we are quite capable of resolving the issue presented,” it nevertheless certified the question because “[t]he decisions of the California appellate courts provide no controlling precedent regarding the certified question, the answer to which may be determinative of this appeal.”  The court explained that the certification procedure “is reserved for state law questions that present significant issues, including those with important public policy ramifications, and that have not yet been resolved by the state courts.”  The court added: “We request certification not because a difficult legal issue is presented but because of deference to the state court on significant state law matters.”  (See also Doyle v. City of Medford, 565 F.3d 536, 543 (9th Cir. 2009) [“the question whether retired public employees have a vested property right to health insurance coverage after retirement under [Oregon state law] is one of exceptional importance to citizens of the State of Oregon and to local governments within the state.”]) That narrow ground for certification probably means that the procedure will be available in only a limited number of takings cases.  But if the property right issue is one of “state statutory construction and the position of the state court is uncertain” then the likelihood of certification might possible be greater.  (See e.g., Estate of Madsen v. Commissioner, 659 F.2d 897, 899 (9th Cir. 1981).)  Nevertheless, not many state law property questions in federal takings actions are likely to meet that standard, and so most unresolved state law issues are likely not to be resolved through the certification procedure.

As Justice Kagan also seems to suggest, federal courts could invoke the Pullman abstention doctrine as a means to stay federal actions and to require the litigants pursue resolution of unresolved issues of property law in the state courts.  In the Ninth Circuit, the Pullman abstention doctrine allows a federal court to postpone the exercise of federal jurisdiction when “a federal constitutional issue . . . might be mooted or presented in a different posture by a state court determination of pertinent state law.”  (C-Y Development Co. v. City of Redlands, 703 F.2d 375, 377 (9th Cir. 1983).)  Three criteria must be met before Pullman abstention is appropriate in the Ninth Circuit:

(1) The complaint touches a sensitive area of social policy upon which the federal courts ought not to enter unless no alternative to its adjudication is open.

(2) Such constitutional adjudication plainly can be avoided if a definitive ruling on the state issue would terminate the controversy.

(3) The possibly determinative issue of state law is doubtful.  [Sinclair Oil Corp. v. County of Santa Barbara, 96 F.3d 401, 409 (9th Cir. 1996).]

Questions involving land use decisions have often been found to satisfy the criteria for Pullman abstention.  (See e.g., C-Y Development, supra, 703 F.2d at 376-381; VH Prop. Corp. v. City of Rancho Palos Verdes, 622 F.Supp.2d 958 (C.D.Cal. 2009.))  That includes state law issues in cases involving federal takings claims.  (See e.g., San Remo Hotel v. City and County of San Francisco, 145 F.3d 1095, 1105 (9th Cir. 1998).)

However, it is not clear after Knick whether federal courts facing increased challenges to the validity of local actions that involve state property law and local government law questions will adopt a robust application of Pullman abstention.  On the one hand, the already over-burdened District Courts will be tempted to use the abstention to alleviate Justice Kagan’s concern about “a mass of quintessentially local cases involving complex state-law issues.” [2]  On the other hand, federal courts are willing to accept takings cases that involve state law property questions, as even Justice Kagan’s dissent highlighted based on the disputed claims discussed in the briefing in the Knick case.  What is likely after Knick is (1) District Courts may be more receptive to Pullman abstention arguments in cases with unresolved property rights issues under state law; and (2) federal courts will increasingly find it necessary to adjudicate state law issues of the property rights of takings claimants, especially where certification and abstention are not available.

Regulatory Invalidation vs. Compensatory Regime

The second unstated but possible consequence of Knick is an uncertainty regarding what kind of compensatory regime for land use regulations will be sufficient to avoid invalidation of a land use regulation.  The majority opinion emphasized that governmental action that constitutes a taking may continue so long as compensation will be available after the taking occurs.  The Chief Justice explained that the new rule set forth in Knicks

does not as a practical matter mean that government action or regulation may not proceed in the absence of contemporaneous compensation. Given the availability of post-taking compensation, barring the government from acting will ordinarily not be appropriate.

The Chief Justice repeated that governments “need not fear that our holding will lead federal courts to invalidate their regulations as unconstitutional” because “[a]s long as just compensation remedies are available … injunctive relief will be foreclosed.”  Or, as Justice Thomas argued in his concurring opinion, “Injunctive relief is not available when an adequate remedy exists at law.”[3]  However, two questions arise from those statements.

First, will sovereign immunity issues impact the availability of compensation in federal courts, which could impact the likelihood of injunctive relief?  In the context of takings claims against a state, one commentator opines:

A property owner is not going to get a federal court to enjoin a regulatory taking, or declare a statute or regulation unconstitutional. Unless for some reason no compensation is available. For example, what if the defendant is a state, and recovering compensation is barred in federal court by the Eleventh Amendment? If you are prohibited from your legal remedy of compensation, may you ask for an injunction under Ex parte Young?  [Robert H. Thomas, “Knick Analysis, Part V: What Next?” Inverse Condemnation Blog, June 24, 2019, https://www.inversecondemnation. com/inversecondemnation/2019/06/knick-analysis-part-v-whats-next-.html.]

Second, what is a sufficiently available “post-taking compensation” or “compensation remedy” that avoids invalidation of the land use regulation by federal courts?  Another way to ask that is: What is the “some way to obtain compensation after the fact” that will pass constitutional muster? The Court does not say.  That uncertainty now exists after Knick, which did not exist under the state court procedures and remedies and had to be pursued under the prior Williamson County rule.

Can “Normal” Regulatory Delays Constitute Compensable Takings?

The third unstated but possible consequence of Knick is a renewed challenge to the California Supreme Court’s decision in Landgate v. California Coastal Commission (1998) 17 Cal.4th 1006, in the federal courts.  In Landgate, the County of Los Angeles had approved a lot split involving property in the coastal zone. When the owner sought to build upon one of the newly split parcels, the California Coastal Commission refused to issue a permit for any construction, contending that the prior lot split was not legal. Construction was delayed for two years until the landowner obtained a court judgment that the Coastal Commission had no legal jurisdiction over the lot split. The landowner contended this delay denied it all viable use of the property for two years, which constituted a temporary taking requiring compensation. The California Supreme Court disagreed.  It held that “the mistaken assertion of jurisdiction over a development is part of the development approval process, and development delays that result therefrom may be imposed on the developer rather than the general taxpayer without violating the United States Constitution.” (Id. at pp. 1021.) The court explained:  “Here, there was a postponement of development pending resolution of a threshold issue of the development approval process–whether the lot was legal–and not a final decision denying development.” (Id. at pp. 1029-1030.) The court added: “[A] judicial determination of the validity of certain preconditions to development is a normal part of the development process, and the fact that a developer must resort to such a determination does not constitute a per se temporary taking.” (Id. at p. 1030.)  Subsequent California courts applying Landgate have held that regulatory delays were normal and therefore not compensable, while other regulatory delays were not.  (See e.g., Ali v. City of L.A. (1999) 77 Cal.App.4th 246, 250-255.)

Since takings cases in California can now bypass the state courts that are governed by Landgate and can go directly to federal court, will the “normal delay” substantive Landgate rule still be applied to such federal takings claims?  One argument in favor of maintaining the Landgate rule is that it appears to be supported by language in the U.S. Supreme Court’s decision in First Lutheran Church v. Los Angeles County (1987) 482 U.S. 304 (“First English”).  As the California Court of Appeal explained:

The court in First English indicated two circumstances in which such a temporary denial of all use of the property would not require compensation: … (2) the temporary deprivation was merely a normal delay in the permissible regulation of development. (482 U.S. at p. 321 [not deciding “the quite different questions that would arise in the case of normal delays in obtaining building permits, changes in zoning ordinances, variances, and the like”].)  [Ali, supra, at pp. 253-254.]

However, an argument can be leveled against the Landgate “normal delay” rule on the ground that Landgate was based on the language in Agins v. Tiburon, 447 U.S. 255, 260 (1980), that government regulation of private property effects a taking if such regulation does not substantially advance legitimate state interests (Landgate, supra, 17 Cal.4th at pp. 1010, 1018), but that language was later rejected by the U.S. Supreme Court in Lingle v. Chevron U.S.A. Inc., 544 U.S. 528, 548 (2005).  As the California Court of Appeal for the Fourth Appellate District recently explained:

In the wake of Lingle, state and federal courts alike have recognized that the “substantially advances” formula that the United States Supreme Court articulated in Agins and the California Supreme Court applied in Landgate no longer constitutes a valid test by which to determine whether there has been a regulatory taking under the Fifth Amendment; instead, the Penn Central [Transp. Co. v. New York City, 438 U.S. 104, 124 (1978)] factors govern. [Bottini v. City of San Diego (2018) 27 Cal.App.5th 281, 310.][4]

Thus, there is uncertainty as to the continued validity of “normal delay” takings cases in California under Landgate.  Until the California Supreme Court revisits that issue, it is possible that there may be a substantive difference between the federal and state venues in regards to takings claims based on a regulatory delay under the Fifth Amendment to the U.S. Constitution, simply because federal courts are not bound by the Landgate decision.

Thus, while the Court’s decision to reverse the Williamson County procedural rule was fairly simple, the possible consequences are not.  The Knick case could have significant implications in the way takings cases are adjudicated in California, as well as in how local agencies prepare for the potential flood of such cases in federal courts in this state.

Glen Hansen is an Attorney 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.

______________________

[1] After Knick, most practitioners envision an increase in federal takings litigation.  (See Paul Beard, II, “‘High Court’s Knick Ruling Is a Big Win for Property Rights,’ Law260, June 28, 2019, found at https://www.alston.com/en/insights/publications/2019/06/high-courts-knick-ruling-is-a-big-win (last accessed August 8, 2019) [as a result of the Knick decision, “one can expect a steady stream of new takings claims against state and local actions,” and “we expect to see an increase in federal takings claims brought in federal courts across the country”]; Jonathan G. Cedarbaum, Michael J.P. Hazel, “Supreme Court Removes Obstacle to Property Owners Bringing Takings Claims in Federal Court,” June 24, 2019, found at https://www.wilmerhale.com/en/insights/client-alerts/20190624-supreme-court-removes-obstacle-to-property-owners-bringing-takings-claims-in-federal-court (last accessed August 8, 2019) [“Property owners affected by local governments’ actions may now take their federal takings claims directly to federal court. That will likely lead to many more just compensation challenges to local government regulations being adjudicated in federal court and it may thereby enable such challenges to be resolved more quickly.”])  But see Ilya Somin, “Knick v. Township of Scott: Ending A Catch-22 The Barred Takings Cases From Federal Court, George Mason University Legal Studies, Research Paper Series, LS 19-16 (Sept. 9, 2019), found at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3450572&dgcid=ejournal_htmlemail_u.s.: constitutional:law:rights:liberties:ejournal_abstractlink (last accessed September 25, 2019) (“Somin”)[“Critics of Knick argue that it could generate a flood of new federal court litigation.  It is by no means clear that this will happen.”])

[2] A robust application of the certification process could also have the effect of diminishing the crush of federal takings cases that Knick opened the door to.  As one commentator opined:  “Enlisting the aid of the state courts in resolving state law issues raised in federal court takings cases will make the litigation process more protracted than it would be if plaintiffs simply filed in state court in the first instance.”  (“Knick: Williamson County Overruled,” June 25, 2019, https://takingslitigation.com/2019/06/25/knick-williamson-county-overruled/ (last accessed August 8, 2019.)

[3] It’s questionable whether takings claimants will adhere to the majority’s comments about invalidation.  As one real property practitioner suggested after Knick:  “One sensible route for a project proponent wanting to, say, challenge a law imposing such unconstitutional takings in the permit process is to sue for that law’s invalidation in federal court.”  (Beard, supra, at note 1.)

[4] The Court of Appeal went on to state:  “We … conclude that the Penn Central test endorsed in Lingle—and not the “substantially advances” formula—applies to ad hoc regulatory takings claims that arise under the California Constitution.”  (Bottini, supra, 27 Cal.App.5th at p. 310.)  For an application of the Penn Central factors, see Murr, supra, 137 S.Ct. at 1945-1950; Shaw v. County of Santa Cruz (2008) 170 Cal.App.4th 229, 271-275.

Hollywoodians Encouraging Rental Opportunities v. City of Los Angeles (2019) 37 Cal.App.5th 768

The Court of Appeal affirmed the trial court’s denial of a writ of mandate demanding the City of Los Angeles (“City”) prepare an EIR for the conversion of a former rental apartment building into a hotel. The Court held that as the building had not been a part of the rental housing market for years, there was no need for an EIR to assess the loss of affordable housing.

The owner of an 18-unit apartment building in Hollywood filed an application in 2009 to convert the apartment complex into a 39-unit condo project. Between 2009-2014 all previous residents of the 18-unit complex vacated and the owner abandoned his plans to convert the property. Further, the owner withdrew the building in 2013 from the rental market as allowed by the Ellis Act rental use in 2013 and thereafter proposed a boutique hotel (“Project”). By July 2015, the owner filed applications for a CUP, variance, and rear yard adjustment with the City to convert the property. After conducting an initial study, the City determined “the Project would cause either a less-than-significant impact or no impact.” As a result, the City adopted a mitigated negative declaration (“MND”) in December 2015. An unincorporated association, Hollywoodians Encouraging Rental Opportunities (“HERO”), filed suit against the City to set aside the project approvals.

HERO alleged: 1) the record supported a fair argument of substantial environmental impacts resulting from the project, 2) the initial study failed to examine cumulative impacts and therefore the Project approvals were not proper, 3) the City improperly bifurcated the MND from the Project approvals, and 4) the City improperly handled HERO member Shain’s appeal to the Los Angeles Area Planning Commission. The trial court denied the petition concluding that the City used the proper baseline because during 2015 when the MND was approved by the City, there were no adverse impacts on population or housing due to the lack of tenants. The trial court affirmed the City’s determination that the Project was not subject to the Ellis Act because of the owner’s withdrawal of the units from residential use, as articulated by the Ellis Act. On appeal, the appellate court agreed. The appellate court found the building was uninhabited when the Project commenced in 2015. The appellate court rejected HERO’s contention that the units may be later restored as rental units as purely speculative and that the Ellis Act allows property owners to exit the residential real estate market. The record supported the City’s determination that the property was removed from the residential housing market in 2013 when residents vacated. As such, the appellate court held that the City used an appropriate baseline and HERO lacked a fair argument to prove the project may have a significant environmental impact.

HERO further alleged the City failed to analyze cumulative impacts. The court disagreed, concluding that because there was no substantial evidence to show an adverse project impact the City was not required to evaluate cumulative impacts. The appellate court acknowledged that it was aware of the shortage of affordable housing in Los Angeles. However, the appellate court determined that the building vacancy as a result of the Ellis Act effectively precluded evaluation of the loss of housing as part of a CEQA evaluation.

William Abbott is an Attorney at Abbott & Kindermann, Inc.  Kristen Kortick is a Law Clerk 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.

 

Please join me on September 24, 2019 for an all-day seminar titled, “Winery and Vineyard Law”. The seminar is hosted by National Business Institute and will take place from 8:30am-4:30pm at the Crown Plaza Sacramento, 5321 Date Avenue, Sacramento. Register at the link here: https://www.nbi-sems.com/83117 . I look forward to meeting you there!

Diane Kindermann Henderson 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.

Shirli Fabbri Weiss v. City of Del Mar (2019) Cal.App. LEXIS 834

Litigation challenging a land use decision is subject to short statute of limitations. While Government Code section 65009 sets forth several different time frames depending upon the legal theory, subdivision (c) requires a plaintiff to file and serve the complaint and summons within 90 days of most decisions concern planning, zoning, and other types of land use permits. (Most claims pursuant to the Subdivision Map Act are subject to a similar 90-day statute found at Government Code section 66499.37.) Subdivision (c) provides as follows:

(c) (1) Except as provided in subdivision (d), no action or proceeding shall be maintained in any of the following cases by any person unless the action or proceeding is commenced, and service is made on the legislative body within 90 days after the legislative body’s decision:

(A) To attack, review, set aside, void, or annul the decision of a legislative body to adopt or amend a general or specific plan. This paragraph does not apply where an action is brought based upon the complete absence of a general plan or a mandatory element thereof but does apply to an action attacking a general plan or mandatory element thereof on the basis that it is inadequate.

(B) To attack, review, set aside, void, or annul the decision of a legislative body to adopt or amend a zoning ordinance.

(C) To determine the reasonableness, legality, or validity of any decision to adopt or amend any regulation attached to a specific plan.

(D) To attack, review, set aside, void, or annul the decision of a legislative body to adopt, amend, or modify a development agreement. An action or proceeding to attack, review, set aside, void, or annul the decisions of a legislative body to adopt, amend, or modify a development agreement shall only extend to the specific portion of the development agreement that is the subject of the adoption, amendment, or modification. This paragraph applies to development agreements, amendments, and modifications adopted on or after January 1, 1996.

(E) To attack, review, set aside, void, or annul any decision on the matters listed in Sections 65901 and 65903, or to determine the reasonableness, legality, or validity of any condition attached to a variance, conditional use permit, or any other permit.

(F) Concerning any of the proceedings, acts, or determinations taken, done, or made prior to any of the decisions listed in subparagraphs (A), (B), (C), (D), and (E).

The scope of this statute was brought into question in a legal challenge to the application of a view protection ordinance adopted by the City of Del Mar. The ordinance protects neighbors whose views are unreasonably obstructed by vegetation on nearby property. Weiss, a property owner in Del Mar, filed an application with the City for a determination that her view had been blocked by vegetation on a neighbor’s property. By the time the planning commission heard the matter, the neighbor had pruned back the vegetation, but Weiss still sought a determination of an ongoing obligation of the neighbor to comply in the future. The planning commission denied the request, and the City Council denied the appeal on July 17, 2019. In September, Weiss file a petition for writ of mandate, but did not serve the City with the petition until December 19, 2017. The City and neighbor successfully moved to dismiss the case on the grounds that it had not been timely served. Weiss appealed and the Court of Appeal affirmed.

While the appeal involved several nuanced arguments involving statutory interpretation, the most interesting issue was: did this statute of limitations provision apply to an ordinance (the view protection ordinance, adopted as Title 23) which was adopted by the City in a separate title outside of the designated zoning ordinance (Title 30)? The appellate court interpreted 65009 broadly, concluding that the implementation of the view ordinance was assigned to the planning commission, and that the subject matter was similar to land use matters typically found as a land use regulation covered by zoning and vested with the planning commission. Accordingly, while the view ordinance was not embedded in the City zoning ordinance, the 90-day statute of limitations, including service of the summons, did apply. The appellate court affirmed.

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.

Please join me on September 24, 2019 for an all-day seminar titled, “Winery and Vineyard Law”. The seminar is hosted by National Business Institute and will take place from 8:30am-4:30pm at the Crown Plaza Sacramento, 5321 Date Avenue, Sacramento. Register at the link here: https://www.nbi-sems.com/83117 . I look forward to meeting you there!

Diane Kindermann Henderson 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.

In Union of Medical Marijuana Patients, Inc. v. City of San Diego (2019) Cal. LEXIS 6005, the California Supreme Court tackled the illusive question of when is a discretionary action which does not qualify for exemption, “not a project”. Like many other CEQA judicial decisions, the answer does not involve a bright line test.

The decision originated with the City of San Diego amending its zoning code. The effect of this action was to permit cannabis enterprises as a use within a number of zoning districts in the City. The ordinance also had the effect of capping the number of facilities. As part of the code amendment, the City concluded that the action was not a “project” for CEQA purposes, and accordingly did not prepare any formal CEQA documentation. Petitioner Union of Medical Marijuana Patients, Inc., challenged the ordinance on CEQA grounds. The trial court denied relief and at the court of appeal, Petitioner argued that Public Resources Code § 21080 provided as a matter of law that a zoning ordinance was a project. The court of appeal rejected that argument, reaching a contrary conclusion to a similar holding in Rominger v. County of Colusa (2014) 229 Cal.App.4th 690.  The Supreme Court granted review to resolve the conflicting appellate decisions.

The Supreme Court first addressed the potential conflict between Public Resources code §§ 21065 and 21080. The Court ultimately concluded that zoning ordinances were not “projects” per se, notwithstanding the suggestion in § 21080 to the contrary.

The Supreme Court then addressed whether the City reached the correct conclusion when concluding that the ordinance was not a project. On this issue, the Supreme Court reversed. 

The decision draws heavily from the Muzzy Ranch decision involving the airport land use commission’s adoption of a policy precluding additional rezoning with the effect of increasing residential density in areas subject to high levels of overflight noise. Muzzy Ranch Co. v. Solano County Airport Land Use Commission (2007) 41 Cal.4th 372. The commission relied on the “common sense” exemption and did not conduct CEQA review. A property owner challenged the decision, arguing the potential for displaced development to occur elsewhere. In Muzzy Ranch, the Supreme Court concluded that the Commission had incorrectly concluded that the policy adoption was not a project. Nevertheless, the Court concluded that the Commission’s action was otherwise correct on the basis that any displaced development would be consistent with existing general plans and zoning and therefore exempt under Public Resources Code § 21083 and Guidelines § 15183.

The obligation of the lead agency in applying the commonsense exemption is to consider “the potential environmental effects of undertaking the type of activity proposed, ‘without regard to whether the activity will actually have environmental impact,’… a project is a CEQA project if, by its general nature, is capable of causing a direct or reasonably foreseeable indirect physical change in the environment.” Union of Medical Marijuana Patients, citing Muzzy Ranch, supra 41 Cal.4th at p.382. With respect to indirect effects, the lead agency should evaluate two scenarios. An indirect effect is not reasonably foreseeable if “there is no casual connection between the proposed activity and the suggested environmental change or if the postulated causal mechanism connecting the activity and the effect is so attenuated as to be ‘speculative.’” Union of Medical Marijuana Patients citing City of Livermore v. Local Agency Formation Com. (1986) 184 Cal.App.3d 531, 541-543. The Court then cited to examples: adoption of LAFCo policies permitting development outside of cities was a project (Id.) whereas the formation of a Mello-Roos district for the purposes of new school facilities was not a project as the causal connection was missing (Kaufman & Broad-South Bay, Inc. v. Morgan Hill Unified School District (1992) 9 Cal.App.4th 464). 

The Court also noted that the required inquiry was somewhat theoretical, as factual records are rarely developed in circumstances involving the application of commonsense exemptions. Applying the aforementioned criteria, the Court concluded the City’s ordinance had the potential for new uses to established. This in turn created the potential for changed traffic patterns, a reasonably foreseeably indirect impact. Reinforcing the theoretical nature of the inquiry, the court added “the likely actual impact of an activity is not at issue in determining its status as a project.”

When relying upon the commonsense exemption, lead agencies will need to engage in a more abstract evaluation of direct and indirect impacts.    

William 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.

Stopthemillenniumhollywood.com et al., v. City of Los Angeles et al. 2019 Cal.App. LEXIS 780

In Stopthemillenniumhollywood.com et al., v. City of Los Angeles et al. 2019 Cal.App. LEXIS 780, the Court of Appeal delivered a setback to mixed use proposals by invalidating an EIR lacking a specific development proposal, but which evaluated different land use mixes. The Court found that the EIR lacked a definite and stable project description. For all practical purposes, the Court elevated CEQA in importance over how a local government chooses to design its regulatory code and application process. 

The facts involved no insignificant project. The Millennium Project was the redevelopment of a four and one-half acre area surrounding the iconic Capitol Records building in Los Angeles. In 2008, the developer filed a development application describing a detailed proposed project consisting of 492 residential units, a 200-unit luxury hotel, 100,000 square feet of office space, a 35,000 square-foot sports club, more than 11,000 square feet of commercial uses, and 34,000 square feet of food and beverage. As with many other development applications in 2008, it was not advanced by the developer.

In contrast to the 2008 application, the next application in 2011 adopted a more fluid approach. Specific buildings were not proposed, but rather a flexible mixed-use project of up to 1,052,667 square feet of space, allowing for a broad range of residential and commercial uses as allowed for under the equivalency provisions of the city development code. The EIR evaluated different scenarios (more residential/less commercial vs. more commercial/less residential square footage). Neighbors challenged the EIR on several grounds, and the trial court agreed that the EIR lacked a stable project description. While the ensuing appeal and cross-appeal involved additional CEQA claims, the only issue addressed by Appellate Court was that concerning the project description. The Court of Appeal affirmed the trial court’s judgment, concluding that the lack of meaningful detail in describing a specific project precluded effective public participation. Given that a detailed application was filed in 2008 the Court surmised that a detailed submittal was not an undue burden on an applicant.

Comment: Rather than recognizing the inherent right of cities and counties to design land use regulations to be responsive to local needs, the Appellate Court effectively concluded that CEQA was more important. Personally, I think that the Court got it wrong. The CEQA tail should not wag the land use dog. Nothing in state law compels local governments to adopt development codes requiring detailed application submittals. While local agencies have the legal authority to adopt rigorous submittal requirements, there is no statutory mandate to do so. Thus, this decision is in conflict with the long-standing authority of cities and counties to adopt development codes which provide for flexibility in the application and development process.

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.

Sacramentans for Fair Planning v. City of Sacramento (2019) 2019 Cal.App. LEXIS  646

The City of Sacramento, a charter city, approved a fifteen-story mixed use project in its Midtown area, significantly in excess of its adopted height and FAR standards. This approval was based upon a general plan policy which stated, “The City may allow new development to exceed the maximum allowed FAR or density if it is determined that the project provides a significant community benefit.” When evaluating the project, staff identified many benefits associated with the project which “outweighs strict adherence to the General Plan’s FAR.” These benefits included a high level of design, implementation of the City’s targets for increasing households in its core, location in an infill location reducing reliance on personal vehicles, and lowered carbon emissions. The City conducted CEQA review based upon the sustainable communities environmental assessment (“SCEA”). The ensuing litigation challenged both the avoidance of the development limits of the general plan as well as the SCEA. Both the trial court and Court of Appeal upheld the City’s approval.

Appellant first argued that the City’s practice violated the requirement for zoning uniformity (Gov. code section 65852.) However, this code section did not apply to the City of Sacramento as it was a charter city. Appellant next argued that the City approval violated an obligation to maintain a uniformity by virtue of the Equal Protection and Due Process clauses of the 14th Amendment and California Constitution, along with a contract implied at law between property owners and the zoning authority. Acknowledging the very deferential standard of review when evaluating local land use approvals and the general plan policy, the Court found ample justification in support of the City’s actions. The detailed staff report served as the supporting rationale relied upon by the Appellate Court.

Appellant also argued that the approval constituted spot zoning. The Appellate Court rejected this claim, concluding that the zoning did not operate to create a limited zone surrounded by higher densities, nor did it preclude adjacent owners from achieving a similar benefit. Similarly, the Court of Appeal rejected the argument that there was an improper delegation of legislative authority to the Planning Commission. Pursuant to the City code, it was the city council which made the final determination. The community benefit standard was no less vague than the common public health, safety, and welfare standard which had upheld repeatedly against vagueness claims.

With respect to CEQA, Appellant challenged the City’s use of the SCEA, arguing that the MTP/SCS adopted by SACOG lacked sufficient detailed information such as building densities, but the Appellate Court concluded that MTP/SCS was not required. As a regional planning document, the SCS contained sufficient information upon which the City could determine its conformity. Petitioner also challenged the impact analysis. However, the City had addressed impacts and required mitigation measures through the initial study. While the City may not have looked at the cumulative effects of new high-rise projects in Midtown in its general plan EIR, the EIR for the SCS plan had addressed cumulative effects. That was sufficient and the City could rely upon the SCS EIR for that evaluation.

Commentary: A cornerstone of California land use law since the 1970s has been the standards for density and intensity required by Government Code Section 65302(a). This case concludes that these standards may not be cast in stone but have to be read and applied in conjunction with other relevant general plan policies. This interpretation introduces potentially significant flexibility into general plans facilitating consistency determinations and reducing the need for general plan amendments. 

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.