An environmental impact report for a 560-housing unit specific plan in the Riverside County city of Beaumont has been upheld by the Fourth District Court of Appeal. The court approved the city's use of a baseline for examining water usage that was favorable to the developer, accepted the city's determination that loss of farmland could not be mitigated, and upheld the city's statement of overriding consideration for approving a project with significant environmental impacts.

The City of Beaumont approved the 560-unit Sunny-Cal specific plan for 200 acres in unincorporated Cherry Valley in August 2007. The city also certified an environmental impact report and approved an annexation plan. The core of the specific plan site had been egg farm from the 1960's to 2005. Sunny-Cal Egg & Poultry Company closed the operation because of declining economics of the egg industry. In addition, the San Gorgonio Pass area along Interstate 10, in which the farm is located, is rapidly urbanizing and has been for a number of years (see CP&DR Local Watch, April 2008).  As a result, historic agricultural activities are subject to constant pressure.

Cherry Valley residents challenged the EIR and lost in Riverside County Superior Court. On appeal, the Fourth District, in a very fact-rich decision, addressed three common areas of California Environmental Quality Act (CEQA) litigation: water supply analysis/assessment, agricultural lands mitigation and statements of overriding considerations.

Beaumont and the surrounding area sits atop a groundwater basin known as the Beaumont Basin. In 2004, as a result of litigation to adjudicate groundwater rights, the safe yield of groundwater for the basin was set at 8,650 acre feet per annum (afa), with 1,784 afa allocated to the Sunny-Cal property. This number was based upon the egg farm's historic groundwater pumping.

The water supply assessment in the EIR used 1,484 afa – Sunny-Cal's rights minus 300 afa that Sunny-Cal assigned to a neighboring property – as the baseline for measuring water impacts. The EIR did not use the amount of water used on the site during post-egg agricultural activities, which was estimated at only 50 afa.

Although the court's decision discusses a variety of water supply planning efforts by affected water agencies, the key legal question was whether the most recent use (50 afa), or the adjudicated amount minus the assignment (1,484 afa), was the appropriate baseline. The California Environmental Quality Act generally directs lead agencies to use existing physical conditions when preparing environmental review documents. However, as court recognized, CEQA Guidelines § 15125 leaves room for the lead agency to utilize an alternative baseline. Here, the appellate court determined the 1,484 afa was appropriate in light of the earlier groundwater adjudication.

"Sunny-Cal's right to use 1,484 afa on the project site was unaffected by its cessation of the egg farm operations in late 2005, and the 1,484 afa figure closely approximated Sunny-Cal's historic water usage on the project site while the egg farm was operating," Justice Jeffrey King wrote for the unanimous three-judge panel.

Notably, in upholding the city's baseline, the court ruled that the appropriate judicial review was the more deferential substantial evidence test, rather than the "fair argument" test that favor plaintiffs, because the agency had the discretion to choose, and because the issue was not purely a question of law. Thus, although there may have been other evidence regarding groundwater issues in the basin, there was an adequate basis to support the recognition of Sunny-Cal's rights, the court ruled.

The issue of agricultural land mitigation is of continuing debate in courts throughout California. Beaumont had concluded that long-term trends made it infeasible to offset the conversion of 200 acres of prime agricultural soils to urban use. Project opponents argued the EIR was defective because it did not consider off-site mitigation measures, such as acquisition of land for long-term farming or the acquisition of agricultural conservation easements.   

In ruling for the city, the court recited the evidence in the administrative record supporting the conclusion that the historic and expected land use and economic trends would eventually result in decreased agricultural operations in the area, if for no other reason than farmers are selling their land for urban development. The appellate court cited Defend the Bay v. City of Irvine, (2004) 119 Cal.App.4th 1261 (see CP&DR Legal Digest, Vol. 19, No. 8 Aug. 2004) , in which the court also upheld a city's decision not to mitigate the loss of agricultural land because of negative farm economics. The lesson to be learned here is obvious: Whether the issue involves agricultural land or other natural resources, the lead agency, landowner or developer needs to develop an appropriate level of evidentiary support to defend a determination that a mitigation measure is infeasible.

With respect the statement of overriding considerations, the city had identified eight separate benefits to justify approval of the project notwithstanding the significant unmitigated impacts. Tactically, the city's findings took the approach that each of the eight reasons independently supported project approval, thus forcing the opponents to overturn all eight benefits, a significant undertaking. These benefits in many cases were broadly stated, and, although the opponents argued that some of benefits were nothing more than stated characteristics of the project, the appellate court said that it could not substitute its judgment for that of the City Council.

The Case:

Cherry Valley Pass Acres and Neighbors v. City of Beaumont, No. E049651, 2010 DJDAR 17640. Filed November 22, 2010.

The Lawyers:
For Cherry Valley Pass Acres and Neighbors: Robert C. Goodman, Ann M. Blessing, Rogers, Joseph, O'Donnell, (415) 956-2828.

For the city: Joseph S. Aklufi, Aklufi & Wysocki, (951) 682-5480. 

For Sunny-Cal Egg & Poultry Company: Michelle Ouellette and Fernando Avila, Best, Best & Krieger, (951) 686-1450.


--William W. Abbott