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Solimar Research

Updated CEQA Guidelines Finally Go Into Effect

Apr 15, 2019

When the California Legislature passed Senate Bill 743, Los Angeles’s power plants still burned coal, Newhall Ranch was still defending its EIR, the Clean Water Act still covered vernal pools, and electric cars were less common than Hummers.

Times have changed since 2013.

In December, the Governor’s Office of Planning & Research, in conjunction with the Natural Resources Agency, released the latest set of guidelines for implementing the California Environmental Quality Act, capping off six years of work. The state updates the guidelines, most recently in 2014, largely in response to the many legal decisions handed down each year that influence how CEQA is interpreted.

The most dramatic changes in the new guidelines, though, center on legislation. They include the long-awaited recommendations for how lead agencies should analyze, per SB 743, projects’ transportation impacts according to metrics of vehicle miles traveled as opposed to level of service. While SB 743 belongs to California’s suite of regulations intended to reduce greenhouse gas emissions, many planners hope that the adoption of VMT metrics will produce denser, less auto-dependent, more pleasant communities.

“VMT is really an umbrella metric for a whole array of impacts to environment and health,” said OPR Senior Planner Chris Ganson.

It’s a major legislative change to CEQA and, according to supporters, a welcome move that could supercharge infill development throughout the state.

“We see it as a good opportunity for cities to look at impacts of development and transportation holistically now,” said Krute Singa, a principal regional planner with the San Francisco Metropolitan Transportation Commission.

The less dramatic changes that appear in the new guidelines include the following:

Appendix G: CEQA’s “environmental checklist” has been reconfigured to provide lead agencies with a clearer checklist of conditions that warrant environmental analysis. “The checklist has grown significantly over time,” said Jeannie Lee, senior counsel at OPR. "With this latest round of revisions, some of those questions have been consolidated; some have been removed because they’re redundant.”

Energy Impacts: Stemming in part from the 2016 case Ukiah Citizens for Safety First v. City of Ukiah, Appendix F more explicitly advises lead agencies to quantify a project’s energy impacts. “What we found is that there has been inconsistent application of Appendix F and that some agencies were just not doing the impacts analysis,” said Lee. “Now the issue of energy impacts analysis and the need to mitigate has been elevated to a new subdivision in the guidelines.”

Wildfires: Appendix G now includes an entire section on wildfires, giving lead agencies clearer criteria for determining whether a project might pose a risk. “It’s such a huge issue now, I think it deserves to be its own section,” said William Halligan, managing principal with planning firm PlaceWorks.

“We have a lot of regulatory measures in place already,” said Arthi Varma, deputy director at the Los Angeles Department of City Planning. “But I think it provides us an opportunity at a more global level, as we look at wildfire and energy, to look at how we’re making more sustainable development decisions.”

Environment’s Impacts on Projects: The guidelines also respond to the 2015 case California Building Industry Association v. Bay Area Air Quality Management District, the so-called “CEQA In Reverse” case, in which the court ruled that CEQA requires lead agencies to analyze a project’s impact on the environment but not vice-versa. The guidelines make clear that agencies need not consider, say, the impact sea-level rise might have on a coastal project or a wildfire might have on a project on the urban fringe.

Existing Conditions: The guidelines reiterate that “existing conditions” means existing conditions, except under specific circumstances. “A lead agency can use projected future conditions beyond the date of project preparation as the sole baseline for analysis but it has to be supported by substantial evidence that using existing conditions would either be misleading or have no informative value to decision-makers and the public,” said Lee.

“These changes were intended to make the guidelines more usable and more crisp,” said Lee. “We hope the changes have added clarity as opposed to making them more cloudy.”

But the main event concerns vehicle miles traveled.

The guidelines are predicated on the notion that lead agencies can refer to well established analytical methods to evaluate potential VMT impacts. These methods will, proponents say, be simpler and less costly than current LOS analyses. Many infill projects, especially those in transit-rich and/or walkable areas that might have had enormous LOS impacts may end up with negligible VMT impacts. Conversely, greenfield projects on the urban fringe are nearly certain to generate long car trips for commuters and therefore will fare poorly under the new guidelines.

The big decision that the guidelines leave up to local jurisdictions is that of setting the thresholds that would trigger full environmental impact reports. The guidelines recommend setting thresholds 15 percent below average per capita VMT per existing conditions. But jurisdictions can choose their own thresholds according to local needs and conditions.

The City of Los Angeles, for instance, is setting different thresholds for its seven different planning areas, since conditions in those areas vary significantly. In fact, Los Angeles deviates from the guidelines’ recommendations by adopting thresholds at all. The guidelines suggest that areas with high-quality transit be exempt from VMT analysis entirely. By the guidelines’ definition of high-quality transit, though, the entire city would have been exempt in a way that planners consider nonsensical.

“There’s a large discrepancy between what’s happening at the regional level compared to what’s happening in the City of Los Angeles,” said Varma. She said that, at 9.2 daily miles per capita, the City of Los Angeles is already over 7 VMT per capita below the rest of the SCAG region.

Smaller cities will likely look to regional VMT averages and adopt thresholds accordingly. Local jurisdictions have until July 1, 2020 to adopt thresholds. Several cities, including Los Angeles, San Francisco, San Jose, and Pasadena have already adopted VMT regulations. OPR staff observed and consulted with these cities as they drafted the guidelines.

The guidelines include a menu of recommended (but not required) mitigation measures that projects can implement in order to bring their projected impacts below levels of significance. Whereas LOS analysis essentially required lead agencies or developers to increase road capacity, the VMT-oriented guidelines invite projects to implement such ephemeral, but environmentally friendly, measures such as provision of transit passes, parking areas for bicycles, or pedestrian improvements. Mitigation for LOS impacts generally revolves around increasing road capacity.

Overall, planners have given the guidelines high marks.

“I think the guidelines do the best they can considering the intent of the legislation,” said Halligan.

Those reviews are heartening for OPR staff members, who spent over four years and conducted countless hours of research and outreach efforts to ensure that the guidelines were clear, sensible, and in keeping with the spirit of SB 743.

“It was, I think, the greatest public outreach process that’s been undertaken for a CEQA change,” said Ganson. “For the SB 743 piece alone, I think we have been up to 200 outreach meetings, convenings, participations on panels, etc.”

SB 743’s supporters say that the guidelines herald a new day for planning and development.

“We know the demand for walkabilty is much greater, so low-VMT development helps get people walkable neighborhoods,” said Ganson. “VMT mitigation provides the building blocks of a walkable neighborhood.”

Others are not so sanguine.

Critics, especially those from the California Building Industry Association, contend that VMT analysis will backfire—not only by failing to reduce Californians’ commuting miles but also by failing to ease the state’s housing crisis.

 , senior vice president and general counsel with the Building Industry Association, said that the guidelines’ mitigation measures could end up costing developers dearly and, therefore, drive up prices for infill projects. And even if VMT analysis increases the number of housing units in infill areas, it will not necessarily reduce housing costs, nor will it sway cities that already resist new housing.

Cammarota predicted that demand for low-cost housing in exurbs and outer suburbs will persist and that VMT analysis will simply produce denser infill developments in places that still require lengthy commutes.

“Those projects also have increased costs to mitigate their VMT,” said Cammarota. “That just means that people will continue to drive further and further in order to find a home that is affordable.”

“From a market standpoint, it’s hard to do because of land values,” said Halligan. “If someone works in downtown Los Angeles but they can’t afford to live in LA, they’re going to commute in from the Inland Empire, no matter how much analysis we provide related to VMT.” Halligan suggested that nearly every residential project in a suburban area like the Inland Empire could trigger an EIR.

That is, more or less the point.

“That doesn't mean that we can’t do edge development,” said Ganson. “We just need to look back to how we built communities several decades ago, with localized shopping, pedestrian and bicycle connections.”

Those concerns, though, are far from universal among developers.

“We’ve generally had a fairly positive response from the real estate community,” said Varma. “BIA has put in that comment, but from other developers we have not heard that."

Ganson went further to say that the use of VMT might instigate a wholesale shift in the way residents and developers consider housing costs – and find that VMT-friendly projects come out ahead.

“You might be able to build more cheaply there, but when you look at the housing plus transportation costs, you’re really building something that’s more expensive for someone to live in,” said Ganson.

Cammarota suggested that OPR’s biggest mistake was to require VMT analysis statewide rather than limit it to infill-friendly areas.

“The legislation didn’t require them to apply it anywhere outside of transit-priority areas,” said Cammarota. “It at least offered the hope of coming up with something that would be helpful to infill projects, but I think as it’s turned out, it’s been a far cry from that.”

Even with the best of intentions, non-urban areas could defy the formulas and algorithms designed to estimate projects’ VMT.

“The body of research around mitigation measures, mainly TDM strategies, is 10-20 years old,” said Singa. “Most of those studies are more suited to urban areas or higher densities around transit.”

Even jurisdictions that welcome VMT analysis may still face challenges implementing it. The July 2020 deadline puts planning departments on a tight schedule. Many do not have sufficient personnel to conduct the sort of thoughtful preparatory work that they might want to do.

“I think the primary concern is that a lot of cities don't have the capacity to do this,” said Singa. “Going from LOS to VMT, they have to update their general plans anywhere that refers to LOS.”

Halligan said that firms like PlaceWorks stand to benefit from contracts with cities.

Ultimately, the effectiveness of VMT may depend on how it withstands lawsuits. On that count, VMT eliminates at least one ground for opponents of projects to sue.

“Most CEQA lawsuits pivoted off of LOS,” said Ganson. “The one thing we can be sure of is that those won’t continue to exist.”

For all of the bureaucratic and legalistic nuances of CEQA and the new guidelines, Ganson emphasized that this update – and especially the implementation of VMT analysis – is designed to proactively improve development patterns and create more functional, efficient places.

“Being part of delivering this policy will be gratifying in proportion to how much it improves our communities, how much it averts climate change,” said Ganson. “That, in turn, depends on how local jurisdictions take on the implementation on the ground.”

Contacts & Resources

OPR: CEQA Guidelines Update

Nick Cammarota, Sr. Vice President & General Counsel, California Building Industry Association, ncammarota@ciba.org

Chris Ganson, Senior Planner, Governor’s Office of Planning & Research, Chris.Ganson@opr.ca.gov

William Halligan, Managing Principal, Environmental Services, Placeworks, whalligan@placeworks.com

Jeannie Lee, Senior Counsel, Office of Planning & Research, Jeannie.Lee@opr.ca.gov

Krute Singa, Principal Regional Planner, Bay Area Metro (MTC and ABAG), ksinga@bayareametro.gov

Arthi Varma, Deputy Director, Los Angeles Department of City Planning, arthi.varma@lacity.org