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Study Of Large Irvine Company Development Upheld

The Sierra Club's challenge of the environmental review for a large annexation by the City of Orange and a related development by the Irvine Company has been rejected by the Fourth District Court of Appeal.

The court turned away arguments that the environmental analysis for the Santiago Hills and East Orange projects improperly described the project, segmented environmental reviews, failed to adequately address water quality, incorrectly analyzed traffic and lacked a proper project alternatives analysis.

The area in question is 6,800 acres to the east of Orange but within the city's sphere of influence. During the 1980s, the city certified a program environmental impact report and adopted the East Orange general plan for the area. In 2000, the city certified a supplemental program EIR for the 500-acre Santiago Hills II planned community. Three years later, the Irvine Company submitted an application for a general plan amendment and development entitlements. It proposed 1,700 housing units at Santiago Hills II, 1,100 units in East Orange planned community 1 (EOPC 1), 1,200 units and 212 acres of commercial development in EOPC 2, and 50 units in EOPC 3. Nearly two-thirds of the 6,800 acres would remain open space under the Irvine plan.

The city prepared a combined supplemental environmental impact report for the Santiago Hills portion, and an environmental impact report for the East Orange segments. In November 2005, the City Council certified the combined SEIR/EIR, adopted a statement of overriding considerations because not all impacts could be mitigated, and approved the project. The council eliminated the 50 units in EOPC 3.

The Sierra Club sued, arguing that the city violated the California Environmental Quality Act (CEQA). Orange County Superior Court Judge Stephen Sundvold ruled for the city, and a three-judge panel of the Fourth District, Division Three, upheld the lower court.

First, the court had to determine whether the Sierra Club filed the lawsuit on time. Plaintiffs have 30 days to file a CEQA suit. The city approved the project on November 8, 2005, and filed a "notice of determination" the next day. To correct mistakes, the city filed a second notice of determination on November 14, and a third on November 22. The Sierra Club sued on December 14. Irvine argued the suit was too late because it was filed more than 30 days after the initial notice of determination. The court ruled the environmentalists could rely on the second notice; therefore, the lawsuit was filed on time.

On the merits, the Sierra Club argued the project description was inadequate because the SEIR/EIR acknowledged the exact boundaries of territory to be annexed were yet to be determined. The court, however, said this one statement was not conclusive. The SEIR/EIR contained a written description of the project area and maps depicting the city's sphere of influence and the project area, and described in detail all four planned community areas.

"Since the SEIR/EIR reviewed the entire project area, the mere fact defendant [Orange] may eventually annex only a portion of it does not render the approval an abuse of its discretion under CEQA," Justice William Rylaarsdam wrote for the court.

The Sierra Club argued that the SEIR/EIR broke up impacts into separate project components as a way of minimizing significance. Irvine countered that the Sierra Club did not raise this concern during the administrative proceedings, so it could not raise it in court. The Sierra Club cited numerous pages of the administrative record and two internal documents from the period before the draft SEIR/EIR was released. But none of the Sierra Club's citations were adequate for the court, which ruled the group had failed to exhaust its administrative remedies on the matter. Comments made prior to SEIR/EIR preparation were of little use here, and other comments cited by the Sierra Club were too general to alert Orange adequately to the question segmentation, the court determined.

On the issue of water quality impacts, the court again determined that the Sierra Club had forfeited part of its argument for failing to exhaust administrative remedies. The court determined the Sierra Club could raise only the issue of impacts to Irvine Lake, but concluded the group "failed to accurately summarize the relevant facts." The Sierra Club complained the SEIR/EIR contained only one vague sentence about baseline conditions at Irvine Lake. However, the court noted that an appendix to the SEIR/EIR "provides the information plaintiff contends is missing."

The Sierra Club's best shot might have been on traffic. Three years ago, a different panel of Fourth District judges threw out an EIR that Orange County approved for a development in the same general vicinity because the county did not use the general plan's prescribed methodology for measuring traffic service levels (Endangered Habitats League, Inc. v. County of Orange, (2005) 131 Cal.App.4th 777; see CP&DR Legal Digest, September 2005).

The Sierra Club argued the SEIR/EIR analysis of impacts to Santiago Canyon Road should have been based on county general plan standards because the area is unincorporated. Instead, the SEIR/EIR was based on the city's general plan standards. The court found the city's approach acceptable because the city would annex the portion of Santiago Canyon Road in question were the project to move forward.

The Sierra Club also contested the project alternatives analysis, arguing that more environmentally friendly alternatives were dismissed with little explanation. The court found the alternatives analysis was less than exhaustive and "may not be perfect, but it is sufficient."

The Sierra Club has asked the state Supreme Court to review the case.

The Case:
Sierra Club v. City of Orange, No. G037999, 08 C.D.O.S. 6661, 2008 DJDAR 7956. Filed April 30, 2008. Ordered published May 30, 2008.
The Lawyers:
For Sierra Club: Frank Angel, (310) 314-6433.
For the city: Robert Bower, Rutan & Tucker, (714) 641-5100.
For Irvine Company: Christopher Garrett, Latham & Watkins, (619) 236-1234.
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