By William Abbott and Jessica Melms
In 2010, residents of Redondo Beach passed an initiative allowing the City to establish a public-private partnership for development of the Redondo Beach King Harbor Pier waterfront area. The initiative (“Measure G”) sought to amend the City’s local coastal program (“LCP”) to improve the waterfront area and authorized the renovation of 150,000 square feet of existing building area and added 400,000 square feet of new development on the waterfront (the “Project”).
After the Coastal Commission certified the LCP amendment, the new ordinances went into effect. In response, Respondent, Redondo Beach Waterfront, LLC (the “Developer”), worked with the City and spent over $14 million in Project related costs. On June 23, 2016, the City notified the Developer that its application for the vesting tentative tract map was “deemed complete.”
On June 28, 2016, five days after the City deemed the vesting map application as complete, residents submitted a notice of intent to circulate an initiative (“Measure C”) which would substantially curtail the Project. Proponents of the initiative represented that Measure C would prevent increased traffic and blocked ocean views that would result from the Project. Substantively, Measure C proposed amendments to two City ordinances that had last been changed by Measure G in 2010. It would modify the cumulative development cap to include space devoted to parking facilities and required any expansion on requirements to preserve harbor views.
In early August 2016, the Harbor Commission certified the EIR and approved the coastal development permit, conditional use permit, design review, and the map for the project, but these decisions were appealed to the City Council. The City Council granted final approval of the waterfront entitlements on October 19, 2016. The Council approvals noted that the City’s approval of the tentative map conferred a vested right to proceed with development under Gov. Code section 66474.2.
City voters passed Measure C on March 7, 2017. The City certified the vote and submitted the measure to the Coastal Commission which approved the amendments to the City’s local coastal program. The City then notified the Developer that the measure triggered the agreement’s force majeure clause thereby delaying the Project. The Developer responded by filing a writ of mandate, a complaint for declaratory relief, as well as injunctive relief against the City, on the grounds that Measure C was invalid. The trial court held that the Developer obtained vested rights for the Project before the residents passed Measure C. The residents appealed.
In the published section of the opinion, the Court addressed whether the Developer had obtained statutory vested rights regarding the Project as against the City, and if so, whether those rights vested before or after the passage of Measure C. Since the vested tentative tract map was approved before Measure C, the Developer contended that it obtained vested rights under Government Code section 66498.1 (providing that approval of a vesting tentative map gives the developer the right to proceed with development in substantial compliance with the standards in place when map application was deemed complete.) The Developer also relied on the text of Measure C which expressly exempted any project as to which development rights had vested.
The residents argued that the Developer’s rights had not vested because all necessary permits and approvals had not yet been obtained to complete the Project. Residents further contended that Gov. Code section 66498.1 does not apply to any development situated in whole or in part within a designated coastal zone because that code section is superseded by the Coastal Act.
The Court, however, rejected the residents’ arguments. The City had deemed the vesting tentative tract map for the Project complete well before Measure C was passed in the following year. In addition, the Developer had expended $14 million in Project-related costs during this period. Because the Developer’s rights vested in mid-2016 and the Developer committed significant resources to the Project, it was reasonable for them to rely upon their approved vesting tentative tract map.
Next, the Court addressed the remainder of the resident’s arguments, including, that the Coastal Act renders Gov. Code section 66498.1(b), inapplicable when a development includes an area of designated coastal zone. The court concluded that while the Coastal Commission’s authority is not limited by the vesting provisions of section 66498.1 (a point not disputed by the developer), the City’s actions were constrained by the vesting law.
Commentary: The court got it right. The purpose of the VTM law is very clear: It entitles the developer with a vested right to complete the project (not just to record a final map) in accordance with the standards in effect when its map application was deemed complete. The vesting map law does not rely upon the “all permits” requirement of common law. This underscores the importance to a subdivider to achieving deemed complete status at the earliest time. The vested right created by a VTM is not absolute in every situation (see Government Code section 66498.1(c),) but it is very broad in application.
William Abbott is Of Counsel at Abbott & Kindermann, Inc. Jessica Melms is a law clerk at Abbott and 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.