The state Department of Fish and Game's (DFG) review of development projects under the California Environmental Quality Act is lacking, according to a report by the Legislative Analyst's Office (LAO). And, if the department's budget is cut as proposed by the Davis administration, DFG's project reviews could suffer even more, the LAO concluded. "We found that the effectiveness of the department's CEQA review is limited by several factors, most significantly the department's lack of a formal process for prioritizing projects for review and determining their level of review," the LAO report states. The department could only estimate that it annually receives 8,000 to 13,000 CEQA documents, of which the department reviews about 40%. The LAO reported that the comments DFG did provide to local agencies were not based on a standard protocol and were not followed up. The Legislative Analyst was also sharply critical of the department's data gathering and management. "At the time this report was prepared, DFG could not provide basic information about its CEQA review activities (such as the number and type of documents it receives), thereby making both internal management and legislative oversight difficult. Specifically, without adequate tracking of its CEQA review activities, we question how the department can adequately budget for these activities and target its resources effectively," states the report. A 1990 law requires DFG to collect fees for its environmental reviews, and the department took in $1.8 million in fees during the 2000-01 fiscal year. But the LAO found that local agencies apply the fees inconsistently, and the money did not necessarily fund CEQA reviews. The LAO had four primary recommendations for the department: o Establish clear workload priorities. o Standardize the type of information provided in comments. o Improve data management. o Assess the effectiveness of a sample of widely used mitigation measures. The report is available on the Legislative Analyst's website at * A housing element bill that drew intense opposition from local governments last year has returned to the Legislature with extensive amendments. However, cities and counties still oppose SB 910 (Dunn), which would order the state Controller's Office to fine jurisdictions that lack a certified housing element. The amendments introduced in May reflected months of work by a housing element working group. The bill would be the biggest overhaul of the housing element statute since the original law passed in 1980. Among other things, the bill would modify how fair-share housing allocations are made and require local governments to implement programs by a specific date. The Assembly Local Government Committee passed the amended bill in early June. However, the Assembly Committee on Housing and Community Department postponed two hearings scheduled for later in the month. Lawmakers are scheduled to resume consideration of SB 910 in August. * California will need $56 billion worth of infrastructure improvements during the next five years, according to a report from the Department of Finance. The Legislature mandated preparation of a five-year infrastructure plan in 1999. This is the first version, and it was released nearly six months late and with little publicity. The plan says the state needs $27.7 billion worth of transportation projects, $14.9 billion worth K-12 schools, $5.4 billion for higher education facilities, $2.4 billion of water projects, $1.5 billion worth of natural resources and environmental protection, and $1.1 billion of public safety facilities. Money for the projects would come from several sources: $21.1 billion in state bonds, $14.4 billion from dedicated revenues such as gasoline taxes, $13.6 billion in federal funding, $3.2 billion in lease-revenue bonds, $1.6 billion from the general fund, and $2 billion from smaller sources. While long-time infrastructure proponents, including the California Business Roundtable, called the report a good first step, skeptics questioned who would implement the plan. The plan is available on the Department of Finance website at * Gov. Gray Davis could complete four years in office without making substantive changes to the California Environmental Quality Act Guidelines. The Governor's Office of Planning and Research (OPR), and the Resources Agency have conducted stakeholder meetings and received about 300 suggestions for changes since beginning a review process in March 2000. To date, however, proposed revisions have not been released for public review and officials indicate the matter is not a priority for Davis administration leaders. The most substantive of the proposed revisions deal with mandatory findings of significance and the determination of significance, according to OPR. Other changes would be technical or would reflect recent statutory changes, which have been minimal. State officials plan to conduct several public workshops prior to adopting changes. The last major revisions to the CEQA Guidelines were adopted by the Wilson administration in 1998 (see CP&DR Environment Watch, October 1998). A Sacramento County Superior Court threw out some of those revisions last year (see CP&DR Legal Digest, June 2001), but an appeal is pending. The Resources Agency adopted minor technical revisions in February 2001. * The Legislative Analysts Office (LAO) has recommended lawmakers take an active role in the implementation of Proposition 40, the $2.6 billion parks and natural resources bond that California voters approve in March. The LAO urged the Legislature to: o Review grant criteria. o Monitor administrative costs and cap them at 5%. o Designate a lead agency, probably the Resources Agency, to oversee all Proposition 40 activities and reporting. o Require the governor's budget to display bond fund balances. o Consider in the budget process the future costs of maintaining and developing land acquired with bond funds. The report is available on the LAO website at * A bill by U.S. Sen. Barbara Boxer that would designate 2.5 million acres in California as "wilderness" is receiving a great deal of attention. Many rural communities whose economies rely on timber, cattle grazing and mining, as well as motorized vehicle recreation, are opposed to S 2535, which Boxer introduced in May. Boxer says the measure is necessary to protect plant and animal species, and the watershed. Republicans in Congress have vowed to kill the proposal, but Boxer has indicated she will press the proposal for as long as it takes. A detailed map of the proposed wilderness areas is available on Boxer's website, * Save-the-Redwoods League signed an agreement in June with Stimson Lumber to purchase 25,000 acres of redwood forest in Del Norte County for $60 million. As part of the agreement, the League and Stimson will jointly pay the county $5 million to offset to loss of future revenues from timber harvesting. The state provided $42.5 million from various sources, including parks and water bonds, for the purchase. The U.S. Fish & Wildlife Service provided $2.5 million, and the private League contributed $15 million. After completing the deal, the League turned over the title to the state Department of Parks and Recreation, which already owns two adjacent parks. The acquisition is three times the size of the Headwaters Forest in Humboldt County, which the state purchased for $480 million in 1998. * About 40% of California's cities and counties have not updated their general plans comprehensively in at least 10 years, according to the Office of Planning and Research. In a letter to the state attorney general, OPR identified 197 cities and 27 counties that have not overhauled their general plans in a decade or more. That is about 20 more jurisdictions than were on the 10-year list in 2001, according to State Clearinghouse Director Terry Roberts. However, about 50 of the jurisdictions are working on comprehensive updates, she said. * The San Diego Unified Port District's development and leasing activities came under sharp criticism in a report by the State Auditor. The report says the Port District chose a hotel developer without seeking competitive proposals, setting up a deal that ultimately cost the district millions of dollars and more than two years of delay. The report also says that the port's lease rate for an existing hotel was below market rate, that the port's board failed to meet the state open meeting law on several occasions, and that a port commissioner failed to disclose an interest in a property. In June 1999, the port chose resort developer Douglas Manchester to build a large hotel adjacent to the convention center. The port district signed a contract with Manchester without issuing a request for proposals. The original contract was canceled in October 1999. The sides signed new agreement, although the port board did not publicly approve the amended contract, according to the state auditor. Manchester never broke ground and in June 2001, the port district agreed to pay him more than $5 million to end the contract and prevent him from suing the agency. The port district has since issued a request for qualifications. The port also did not solicit competitive proposals for two other hotel projects, according to the state auditor. The auditor found that the port district has charged below-market lease rates to the San Diego Marriott Hotel since October 1996 and, under contract, cannot change the rate until 2006. The below-market lease could cost the port district $7.4 million over 10 years. There was no public discussion of the below-market rate, according to the state auditor. In a brief response letter, Port District Executive Director Bruce Hollingsworth downplayed the state auditor's findings, calling the issues raised "relatively minor." The report is available on the state auditor's website, * The California Coastal Commission unanimously rejected a proposed 12-story hotel in downtown Oceanside. During their June meeting, commissioners rejected the city's proposed Local Coastal Plan amendment, which would have closed several streets to vehicle traffic to allow Manchester Resorts to build a 400-room resort (see CP&DR Local Watch, November 2000). "This is too dense, too big and doesn't consider public access," Commission Chairwoman Sara Wan said. * The Irvine City Council in June approved a general plan amendment and rezoning that allows for development of 12,350 housing units and 7.3 million square feet of office, retail, and industrial space on about 3,100 acres. The plan for the Orange County city's northern sphere of influence also designates 4,600 acres as permanent open space, including parkland. The Irvine Co. owns the land, which is next to the closed El Toro Marine Corps base. Annexation proceedings for a small portion of the Northern Sphere are already underway. * The Redondo Beach City Council has rescinded its approval of a specific plan for 150 acres of the waterfront. The council voted 3-2 in June to kill the "Heart of the City" plan after project opponents gathered enough signatures in only two weeks to force a referendum (see CP&DR Local Watch, January 2001). Opponents said the plan for infill and redevelopment — which would have allowed about 3,000 new residences and 600,000 square feet of commercial space — was simply too intense for the Southern California beach town. "A lot of people will be receptive to a scaled-down version," leading project opponent Chris Cagle told the Daily Breeze. "I don't know how scaled down." * A proposal to build a football stadium in downtown Los Angeles vanished nearly as quickly as it surfaced. Anschutz Entertainment Group announced in mid-June that it was dropping the project, which had stirred protest from Los Angeles County, taxpayer advocates, the Los Angeles Memorial Coliseum Commission, and even some sports writers. "We just didn't want to go through an ugly political process on this issue," AEG President Tim Leiweke told the Los Angeles Times. The announcement came less than a month after Mayor James Hahn and city councilmembers backed creation of an 879-acre downtown redevelopment project area and suggested they might support public financing for the football stadium (see CP&DR In Brief, June 2002). * A 2.2 million-square-foot office and retail development in El Segundo won voters' approval during a referendum in June. By a two-to-one ratio, voters upheld the City Council's approval of a Thomas Properties Group project on the former Rockwell International factory site near Los Angeles International Airport. About 31% of El Segundo voters turned out for the one-issue special election. Kilroy Realty, a developer whose headquarters is across the street from the site, has tried to block the Thomas project by suing the city and funding the referendum effort (see CP&DR Local Watch, May 2002). * The Gilroy City Council has approved a general plan update that, in part, designates 664 acres of farmland for development of high-tech campuses (see CP&DR Economic Development, January 2002). The council voted 5-2 in June to approve the "660 plan." The city can now proceed with an annexation proposal, although the Santa Clara County Local Agency Formation Commission has already raised questions about the loss of farmland, the potential for flooding and an abundance of land already zoned for industrial development. Three homeowners groups have sued the City of Folsom over the city's recent decision to rezone 128 acres for development of about 2,900 affordable housing units. In April, Folsom officials signed an agreement with Legal Services of Northern California, which earlier won a lawsuit because none of the 7,000 housing units the city approved during the last decade were for low-income people (see CP&DR In Brief, May 2002, January 2002). After signing the agreement, the city identified 64 properties that could be rezoned for affordable housing development. That list caused an immediate not-in-my-backyard backlash from homeowners in the eastern Sacramento County town. Their lawsuit contends the city's agreement was made without public input, would harm public health and safety, and would degrade the environment. * A proposed Elk Grove shopping mall opposed by the state Department of Conservation has been blocked by a Sacramento County superior court judge. The developer of the proposed 295-acre Lent Ranch shopping mall, Martin Feletto, said he would appeal. Judge Lloyd Connelly ruled that the city should have considered the feasibility of creating a permanent agricultural buffer south of the development site as a way of mitigating the loss of prime farmland — the issue that caused the state to sue the two-year-old city. Connolly also ruled the city did not adequately address the risks associated with building near two large propane storage tanks. *