by William W. Abbott and Janell M. Bogue
Properly administered impact fee programs can operate to streamline CEQA review of later development projects. At the same time, impact fee programs which are not implemented in accordance with the original expectations or which are founded upon unrealistic assumptions may offer the lead agency and affected applicant little or no real relief. Significant cases decided over the last five years illustrate how this can play out.
In Napa Citizens for Honest Government v. Board of Supervisors (2001) 91 Cal.App.4th 342, the court of appeal found that a pre-existing fee program failed to provide the “mitigation cover” to avoid a determination that a project impact may be cumulatively significant. The County previously adopted a Napa Airport traffic fee, and collected over $2 million pursuant to this fee. However, the improvements necessary to maintain an adequate circulation totaled over $70 million and although the current project was obligated to pay its fair share of fees, the evidence showed that the necessary improvements would never be funded. As a result, there could be no assumption that cumulative impacts would be mitigated simply by paying the adopted fee.
A different result was reached in Save Our Peninsula Committee v. Monterey County Board of Supervisors (2001) 87 Cal.App.4th 99. In this case, the petitioners challenged a development project approval located in scenic Carmel Valley. One of the legal challenges was to the payment of traffic impact fees as a form of mitigation. The project approval followed the 1995 enactment of a Carmel Valley road impact fee, which called for funding of improvements consistent with the Carmel Valley Master Plan. The fee was set at $16,000 per unit, with annual increases tied to the construction cost index. The mitigation program called for regular monitoring of traffic conditions to determine if specified thresholds were met, which in turn would call for construction of specified improvements. The appellate court characterized the fee program as a “pay-as-you-go” program. The project also contributed to Highway 1 congestion improvements, based upon a mitigation measure called for developer pro-rata contribution to these improvements. The appellate court found sufficient evidence upon which it could conclude that a reasonable commitment to mitigation was demonstrated. In these circumstances, the use of previously adopted fees, as well as ad-hoc fees imposed as part of the project approval constituted effective mitigation.
Two more recent cases have delineated the outer limits of the ability to use fee programs as mitigation for traffic impacts. In Anderson First Coalition v. City of Anderson (2005) 130 Cal.App.4th 1173, the appellate court held that paying a “fair-share fee” is permissible as effective mitigation if the fees are “part of a reasonable plan of actual mitigation that the relevant agency commits itself to implementing.” Project opponents challenged the use of an impact fee to mitigate cumulative traffic effects in the EIR for a proposed Wal-Mart Supercenter. The court held that a fee program would be permissible as long the mitigation measure specified the amount of the fee and the percentage of future improvements for which this developer would be responsible. The court also emphasized that the fees must be a reasonable, enforceable part of an improvement plan that will actually mitigate the cumulative effects. But Endangered Habitats League, Inc. v. County of Orange (2005) 131 Cal.App.4th 777 demonstrates how an incomplete mitigation measure will not allow the fee program to operate as CEQA mitigation. Opponents challenged a fee program to fund road improvements needed due to a proposed residential development. The appellate court held that there was no evidence of a firm and certain plan for improvements because the record showed only the existence of a fee program as well as a planned study to identify needed improvements. The court said, “Since there is no evidence here of what improvements will be funded by the fee programs…we cannot find the mitigated project is consistent with the general plan,” and held that the fee program was not adequate mitigation under CEQA.
What’s the key? In order to count on a previously adopted fee program, or project imposed “fair share” fees, the lead agency must have reasonable evidence in the record to find that the program is sufficiently certain and can be implemented in its entirety over time. “We do not believe, however, that CEQA requires that the EIR set forth a time-specific schedule for the County to complete specified road improvements. All that is required by CEQA is that there be a reasonable plan for mitigation.” (Save Our Peninsula at p. 139.) Where improvements call for significant state or federal funding and that funding is in doubt, then assumed mitigation of cumulative impacts is doubtful and reversal is likely.
(This article was originally published in April 2002)
William W. Abbott is a partner and Janell M. Bogue is a law clerk with Abbott & Kindermann, LLP. For questions relating to this article or any other California land use, environmental and planning issues contact Abbott & Kindermann at (916) 456-9595.
The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, LLP, 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.