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Solimar Research

Courts and OPR may revise CEQA sooner than the Legislature

Martha Bridegam on
Jul 31, 2014

CEQA's future has been in holding patterns across all California's branches of government this summer. But while big things are expected any day in the administrative or judicial branch, CEQA is a sore and sour subject in the Legislature.

In a way, this isn't surprising. It's always been difficult to change CEQA in the legislature. Most of the action has always been in the courts perhaps inevitable for such a litigation-driven law and through the ever-expanding CEQA Guidelines. But it's an anticlimax given the high hopes that Senate leader Darrell Steinberg, D-Sacramento, and others have placed on possible CEQA reform in the last couple of years. The air went out of CEQA reform efforts last year (see http://www.cp-dr.com/articles/node-3437) and this year has been a year of diminished legislative prospects.

In the administrative branch, as Bill Fulton discusses in today's Insight commentary, the Office of Planning and Research (OPR) is nearing completion of an updated alternative to the congestion-based Level of Service (LOS) standard for traffic impact assessments. The new rules, expected to focus on Vehicle Miles Traveled (VMT), may ease the criteria for approving new freestanding and infill construction projects and will certainly shift the tensions that shape project approvals. OPR is also incubating broader revisions to the CEQA Guidelines. See http://www.opr.ca.gov/m_ceqa.php.

In the judicial branch, the California Supreme Court has a towering CEQA backlog of seven cases, several of them major:

  • Most recently, on July 9, 2014, the high court agreed to hear an appeal of the March 2014 ruling on the proposed Newhall Ranch development, Center for Biological Diversity v. Department of Fish & Wildlife, S217763. The partially published March decision by the Second District Court of Appeal (No. B245141) included a densely technical unpublished discussion of greenhouse gas (GHG) reduction goals. As discussed previously at http://www.cp-dr.com/articles/node-3505, Thomas Henry and Bao Vu of the Stoel Rives firm wrote a technically careful blog post at http://bit.ly/1hxBDWz comparing standards for GHG reduction that were set in the case to those apparently set by the recent AB 32 scoping plan update, suggesting that the scoping plan might be more lenient. The Miller Starr Regalia blog has more details on the grant of review at http://bit.ly/U9hhYj. Although the issues addressed are major, David Pettit, a senior attorney with the National Resources Defense Council (NRDC) said the case was also "pretty fact-bound," and so "I don't really see the case as being a blockbuster."
  • The court heard oral argument May 28, 2014, in Tuolumne Jobs & Small Business Alliance v. Superior Court, S207173, on whether CEQA review is still required when a local city council or board of supervisors receives signatures on a ballot measure supporting a project and elects to adopt the project as is rather than submit it to a (potentially costly) special election. See http://www.cp-dr.com/articles/node-3506. This is a longstanding unresolved issue, as local government actions are subject to CEQA and initiatives aren't. So the question is, which type of action is the local government taking when adopting initiative language?
  • The court agreed last November to review California Building Industry Association v. Bay Area Air Quality Management District, S213478, otherwise known as the "CEQA in reverse" case, considering whether developers must respond to the potential future effects of environmental hazards on their projects. See http://www.cp-dr.com/articles/node-3460.
  • The extremely significant case of Berkeley Hillside Preservation v. City of Berkeley, S201116, on "unusual circumstances" exceptions to the infill exemption, was accepted for review in May 2012 and still has not gone to oral argument. See http://www.cp-dr.com/articles/node-3314.
  • On July 9, 2014 the same day it accepted the Newhall Ranch case, the court granted review of the Santa Cruz County rodeo case, Citizens for Environmental Responsibility v. 14th District Agricultural Association (Stars of Justice), S218240. It immediately deferred briefing on the case pending decision of the categorical exemption issue in Berkeley Hillside. See http://www.cp-dr.com/articles/node-3465 on the underlying appellate decision and http://www.courts.ca.gov/documents/ws070714.pdf for the court's account of its action.
  • City of San Diego v. Board of Trustees of CSU, S199557, accepted in April 2012, is also awaiting both argument and decision. The case is discussed briefly at http://www.cp-dr.com/articles/node-3314.
  • Review was granted in January 2014 for Friends of the College of San Mateo Gardens v. San Mateo County Community College District, S214061. For a discussion from the Remy Moose Manley environmental law firm see http://bit.ly/UDTdwW.

(Online dockets for all California Supreme Court cases, with links to the underlying appellate decisions, can be found via search by case number at http://appellatecases.courtinfo.ca.gov/search.cfm?dist=0. The Court's pending issues summary, which it replaces weekly, currently includes the court's statement of issues presented in all the above matters except for the rodeo case. See http://www.courts.ca.gov/13648.htm.)

Anthony Samson, a former CEQA litigator and now a lobbyist with the California Chamber of Commerce, expressed interest (though not exactly agreement) regarding a news analysis, posted by Erin Coe of Law360, that in March 2013 was already suggesting the California Supreme Court may be frustrated with legislative inaction on CEQA and, in Samson's paraphrase, "appears to be taking it into its own hands based solely on the sheer number of CEQA cases pending before the Supreme Court today." (See http://bit.ly/1qGqKWw and http://bit.ly/1psYWOO.)

If anything, the court's CEQA ambition, and the potential significance of its rulings, have only grown since then.

Stalemate in the Legislature


In the Legislature, on the other hand, meaningful CEQA legislation has slowed since the 2013 resignation of Sen. Michael Rubio, D-Bakersfield, who led major attempts at a CEQA procedural overhaul as chair of the Senate Environmental Quality Committee. (See http://www.cp-dr.com/articles/node-3356.)

This year's primary attempt to change CEQA procedure was SB 1451 (http://bit.ly/1p8udwb), to narrow the procedural rights of objectors to projects, principally on what bill proponents called "late hits" last-minute presentations of comments and evidence. That bill was shelved in early May. Remaining CEQA proposals in this session have more specific focuses, on Native American cultural resources (AB 52) and the Tesla battery factory (SB 1309, though the bill itself has lagged procedurally).

Queries to members of the Legislature's CEQA community about next steps or lessons learned after the defeat of SB 1451 got desultory responses over the last several weeks. One senior lobbyist who had dealt with the bill answered, "I don't know what else there is to say about it," and recommended asking someone else.

SB 1451 itself has been convincingly dead since it was pulled from a State Senate Judiciary Committee agenda in early May. With Sens. Jerry Hill, D-San Mateo, and Richard Roth, D-Riverside as principal authors, the measure would have tightened procedural rules to bar critics of a project from presenting new grounds for an allegation of noncompliance with CEQA after the close of the public comment period. Exceptions would have applied if there was no public comment period, or if the late-presented grounds previously "were not known and could not have been known with the exercise of reasonable diligence", a phrase borrowed from CEQA Guidelines 15162. (The Senate Environmental Quality and Judiciary committee analyses at http://bit.ly/1ro6ipC and http://bit.ly/1q5CtsB contextualize the bill as the latest in a string of false starts and incremental changes on similar issues.)

At a State Senate Environmental Quality Committee hearing April 30, Sen. Hannah-Ruth Jackson of Santa Barbara, an EQ committee member and lawyer who also chairs the Judiciary Committee, questioned thoroughly whether the measure would serve its stated purpose. (See minutes 4:31 to 5:21 on the hearing video at http://senate.ca.gov/vod/20140430_0914_STV2Vid.)

Proponents of the measure at the hearing called it a necessary safeguard against "late hit" gamesmanship used to delay projects or gain tactical advantages. Opponents, including environmental and labor lobbyists, suggested the bill might do more to deny a hearing to amateur and underfunded opponents who learn about their rights late in the process than it would do to make experienced players play fair. The sides disagreed on whether SB 1451 duplicated effects from the 2011 case of CREED v. San Diego (discussed by the Abbott & Kindermann firm at http://bit.ly/1lKmi5U). Opponents said CREED already blocked abusive late document dumps; proponents said it only required them to be more clearly presented for review.

Sen. Hill said at the hearing that, among opposition groups, only the Center for Biological Diversity (CBD) had been willing to discuss amendments with him. But later in the same discussion, CBD's California climate policy director, Brian Nowicki, said the group opposed the bill fully, having chosen to withdraw a previously proposed technical amendment.

At the hearing, speakers and legislators gave the impression of being in sympathy with calls to block manipulation of the system, but some, including Jackson, called the bill too crude an instrument to do it. The bill passed out of EQ to Judiciary that day, but by a 4-2 vote: Jackson and Loni Hancock of Berkeley opposed it while Mark Leno of San Francisco gave a reluctant tiebreaking "yes".

Before the bill reached its May 6 Judiciary Committee hearing, the hearing was shown as canceled by author's request.

What's left for CEQA in the current session

The two remaining prominent CEQA bills, AB 52 and SB 1309, are each designed to have major effects in narrow areas. Sierra Club lobbyist Kathryn Phillips noted last month there is always a chance of a a last-minute gut-and-amend attempt to make last-minute CEQA changes but for now the proposals that are conventionally in the works look pretty specific:

AB 52 would redefine environmental effects to include "a substantial adverse change in the significance of a tribal cultural resource" and would require consultation with a locally affiliated tribe. The bill would allow a resource to include a "cultural landscape" as well as a narrowly defined place such as a grave site. A provision limiting its application to federally recognized tribes has raised questions what effect that may have on unrecognized tribes. See http://bit.ly/1pknpsg. The bill is at http://bit.ly/1khDEro.

Legislation could still pass along the lines of SB 1309, by outgoing Sen. Darrell Steinberg, D-Sacramento. In that bill which itself appears to have missed some procedural deadlines Steinberg set out generic "spot bill" language describing an intent to smooth a way to environmental approval for the Tesla company's proposed battery production "Gigafactory". (See http://bit.ly/1u0hGI1 for the SB 1309 bill. Governor Jerry Brown has already signed a different bill, SB 2389, that together with a rich meal of Lockheed incentives allows local governments to offer Tesla tax breaks as incentives to build its factory in their areas. See http://lat.ms/1ydtmLj. On prior efforts to court Tesla see http://www.cp-dr.com/articles/node-3508.)

Topics to revisit next session

That leaves the Legislature waiting for new CEQA ideas, if not eagerly then receptively. In late May the State Senate Environmental Quality and Judiciary Committees even circulated a letter to "CEQA Stakeholders," inviting past participants in CEQA lobbying to submit responses by September 1 i.e., for the next legislative session. The letter asked open-ended questions about what could be improved in CEQA law. (A copy is at http://www.cp-dr.com/sites/default/files/CEQALetterPrinted.pdf.)

Proposals with a strong chance of movement will most likely come from the political right. Environmental and labor advocates don't appear to see any politically realistic amendment that could be to their advantage. Everyone agrees that procedural gaming happens under CEQA but CEQA's defender say the effects of "document dumping" and other surprise tactics are less than business groups claim.

David Pettit of the Natural Resources Defense Council (NRDC) said, "I don't think CEQA is broken. So I don't understand why we need to fix it."

Told that an environmental advocate had made the comment, Samson at the Chamber of Commerce retorted, "I think that saying CEQA isn't broken is turning a blind eye to reality." Samson said the bill was being used "more and more as a mechanism to stop or otherwise delay projects on grounds completely unrelated to the environment. Anybody who says to the contrary, I think, is wholly misinformed."

In last month's conversation, Phillips said the Legislature and staff face an annual weary task of sorting through a welter of CEQA proposals: some politically outrageous, hence not viable, and some densely technical, giving readers the sense that "someone's trying to pull the wool over their eyes." She said past apparent moments of consensus had failed, so that "there's probably no way now to have an intelligent and constructive conversation about CEQA" and from her point of view there were better areas for legislative energy.

There have been a few efforts to punch through the CEQA deadlock with piecemeal single-project legislation but those kinds of bills may have a limited future. Bipartisan irritation is evident over bills like SB 1309 for Tesla and the Sacramento arena provisions of SB 743 that provide procedural or other relief from CEQA requirements for special projects, rather than address the broad nature of the environmental review system. This spring SB 1309 drew critics across an ideological expanse from the Sierra Club to the Sacramento Bee editorial board. With Sacramento a candidate for Tesla's battery factory, the Bee carefully expressed approval of Elon Musk and his lucrative businesses and yet still criticized SB 1309, saying "we don't think that only VIPs Very Important Projects should be given relief from the state's important but often misused California Environmental Quality Act." (See http://bit.ly/1nwqu4R.)

Samson said "many are reluctantly supporting those types of bills" because if they don't support them then they lose their chances of bringing in an important project, "but at the same time, if this is good enough for some projects why can't it be good enough statewide?"

Among other potential areas for legislation is the CEQA front in the eternal conflict between construction companies and labor unions. That was evident on SB 1451, which important labor groups opposed. Business lobbyists have long accused unions of using environmental objections as leverage for contractual advantages such as project labor agreements. A statement issued by the State Building & Construction Trades Council of California said the SB 1451 bill was held back "after the Building Trades' legislative advocates told committee members that the measure would have allowed agencies to ignore risks to public health, communities and construction workers." The statement called the bill "yet another attempt by the Chamber of Commerce, developers and industry to remove our members' voice from the development process."

In the SB 1451 public hearing discussion, agreement had almost seemed to emerge on concern for unlawyered citizens who learned of projects at the last minute, in some cases because of perfunctory compliance with public notice procedures. So would better public notice procedures be a route toward some agreement? Samson said "we made it very clear to the opposition that we were open to" discussing alternatives to make sure that CEQA is providing adequate and effective notice to the public. But he felt more thorough public notice wouldn't resolve the basic disagreements with environmental and labor groups.

Pettit and Samson each independently brought up a possible business-lobby effort on another form of disclosure: to learn more about the identities of organizations challenging projects.

Pettit predicted "the same old stuff" on CEQA in the next session would include disputes over exemptions, efforts to make preparation of the administrative record more difficult for challengers, and more efforts to limit project challengers' standing to sue, in an effort to deter unions and ad-hoc community groups. In that last category he pointed to "very serious First Amendment issues" surrounding goals such as inquiring into organizations' membership and funding sources. He said it's common to point to the narrower standing rules of the federal National Environmental Policy Act as an example though his own response was that an environmental issue, once raised, needs to be resolved, regardless of who raises it.

But Samson argued for more disclosure on "the new wave of neighborhood groups." He said when a proponent is sued by a neighborhood group "citizens against blah" or "neighbors against blah" "You don't know who is actually suing you or who is financing that suit." He said the identity of parties suing thus became an issue, and a problematic one under a statute dedicated to disclosure and transparency.

For a potentially related case from this spring barring depositions of homeowners' association members in a construction defect case, see Seahaus La Jolla Owners Association v. Superior Court, discussed at http://www.cp-dr.com/articles/node-3453, text at http://www.courts.ca.gov/opinions/documents/D064567.PDF.

But considering the many changes that OPR and the State Supreme Court could unload any day now, it remains to be seen how much of the current legislative posture will turn out to matter.