Proposals to create two new state conservancies — one covering as much as a quarter of the state and one focused on a single Southern California river — are alive in the state Legislature. A proposed Sierra Nevada Conservancy appears to have gained some bipartisan momentum, while a proposed Santa Ana River Conservancy struggles to gain ground. Neither proposal is a sure thing during this budget-constrained legislative session. While each proposal has its own set of land use issues and politics, the proposals also raise questions about how the state establishes conservancies, and whether conservancies are a good idea at all. But defenders of the proposed Sierra Nevada Conservancy say that if Los Angeles’s Baldwin Hills and the San Diego River are worthy of a conservancy, surely the state’s defining mountain range is too. Three years ago, the Legislative Analyst’s Office (LAO) recommended the Legislature limit the creation of new conservancies and close out the existing conservancies. The LAO reported "the state lacks a comprehensive and cohesive statewide land conservation plan." Because there is no statewide plan, the conservancies do their own things and state officials are unable to prioritize the use of resources. The LAO’s sharp criticism followed a 2000 State Auditor’s report that reached similar conclusions. The Davis administration attempted to address some of these concerns, but that effort within the Resources Agency apparently petered out with the change in the governor’s office. The findings in the 2001 report still hold true, said Michelle Baass, an LAO analyst. Recent state bonds have provided the conservancies with hundreds of millions of dollars for capital projects. But annual funding for programs, staffing, planning and other basics remains a struggle, and some of the capital funding has been diverted to ongoing operations (see , April 2003). "One of the key considerations is ongoing funding," Baass said. "That’s true of any land acquisition activity … or stewardship of the land" that the state undertakes. The state currently has eight conservancies: Baldwin Hills, California Tahoe, Coachella Valley Mountains, San Diego River, San Gabriel and Lower Los Angeles Rivers and Mountains, San Joaquin River, Santa Monica Mountains, and State Coastal. Their jurisdictions and mandates vary widely, but ongoing funding has been a problem for all of them. One of the newer agencies, the San Joaquin River Conservancy, is a prime example. The conservancy is charged with creating a 22-mile-long parkway from Friant Dam to Highway 99 near Fresno. Since its creation eight years ago, the conservancy has acquired about half the land it needs and opened five miles of trails. A nonprofit trust has built a visitor’s facility. The conservancy, which received $50 million worth of line items in three state bonds, is working on other trails and boating improvements, but the when those facilities will be available is uncertain. "There are no resources right now for operating parks, patrolling parks and any of those things we need for opening facilities to the public. That’s definitely the most limiting thing we face right now," said Melinda Marks, executive director of the San Joaquin River Conservancy. There are funding ideas — local assessments, user fees, local and state agency budgets — but nothing is firm. Marks recommended that state officials figure out how to provide ongoing funding for any new conservancy. Proponents of the new conservancies are aware of the background and concede they do not have all the answers. But, said Clyde McDonald, an aide to Sierra Nevada Conservancy proponent Assemblyman John Laird (D-Santa Cruz), the comparison ought not be between the proposed conservancy and an ideal model, but between the proposed conservancy and the current arrangement, which offers no systemic approach to the mountain range. Bills to establish a Sierra Nevada Conservancy come from either side of the aisle. Laird is carrying AB 2600 while Tahoe City Republican Assemblyman Tim Leslie is behind AB 1788. In April, the Assembly Natural Resources Committee approved both bills. The authors requested the action so that they could continue negotiating toward legislation that both of them can support. The bills have fairly similar aims. The proposed conservancy would serve mostly as a funding conduit, delivering grants and loans to public agencies, nonprofit groups and Indian tribes. The money could be used for cultural, archaeological and historical resource protection, tourism and recreation, reducing wildfire and flood risks, water quality improvements and local economic assistance. "We see it as a potential pipeline of funds to an area that has been chronically underfunded," said Jedd Medefind, Leslie’s chief of staff. "Secondly, it would create a forum for residents, nonprofits and other entities who have a stake in the future of the Sierra to come together." The bills diverge in three areas: Boundaries, governance and the role of local governments. Laird’s AB 2600 covers a broader region that extends north to the southern Cascades (which start at about Lassen Volcanic National Park) and the Modoc Plateau, and east to the White and Inyo mountains east of the Owens Valley. Leslie’s AB 1788 would keep the conservancy south of Lassen and west of Highway 395 and, apparently, farther up the slope of the Central Valley foothills. Laird’s bill calls for a state-dominated, seven-member board: the Resources Agency secretary, the director of finance, an appointee of the governor, and two appointees each by the Assembly speaker and Senate Rules Committee. Leslie’s bill emphasizes a local approach with a 20 member board: 10 county supervisors, six governor’s appointees (including three people from the region) and two appointees each by the speaker and Senate Rules Committee. As for governance, the difference again is state versus local. Laird’s version asks the conservancy to cooperate and consult with local governments. Leslie’s bill would require the appropriate local government to approve of any land acquisition by the conservancy or acquisition funded by the conservancy. "Mr. Leslie comes at it from a local perspective," McDonald said. "My boss comes at from a statewide perspective. We normally don’t give local agencies authority over what the state does." Medefind said the region is so large and issues so diverse that communities should have the final say. Requiring only consultation with local government "could be nothing more than symbolic," he said. Nevertheless, representatives of the two lawmakers continue to negotiate and say a compromise can be reached. Probably no group has worked harder toward creation of Sierra Nevada Conservancy than the Truckee-based Sierra Business Council. According to the council’s 2002 "resource investment needs assessment," the Sierra Nevada provides 60% of the state’s water and up to half of the state’s annual timber harvest, and supports at least half of all plant, bird, mammal and reptile species in the state. At the same time, population is expected to triple between 1990 and 2040, the region gets about 50 million recreational visits per year, large-lot development is common and local economies are in transition. "This is a long-term issue, so a conservancy is the best approach," said Steve Frisch, the council’s director of natural resources. Integrated, long-term planning would bring together all levels of government. Additionally, a conservancy would be eligible for money from state bonds and programs, and could leverage local government, land trust, foundation and landowner contributions, Frisch said. Issues surrounding boundaries and governance have plagued Sierra Nevada Conservancy proposals for the last four years, Frisch conceded. Still, Frisch and other supporters continue to negotiate with lawmakers, and Frisch believes "this is the year." Not everyone is so sure, or so hopeful. Sierra Club lobbyist Jim Metropulos noted that his organization opposed a Sierra Nevada Conservancy bill two years ago because the proposed entity would have been locally controlled and would have let counties opt out. He said the Coastal Conservancy provides a good model, with its "small, independent board of representatives of groups of stakeholders." "We are certainly supportive of a conservancy for the Sierra Nevada," Metropulos said. "But what type of conservancy?" Opposition to the proposed conservancy is led by the California Farm Bureau Federation and local farm bureaus. "It would create another state agency. We feel there is enough bureaucracy already," said Jaimee Wood, executive director of the Butte County Farm Bureau. Approximately 70% of the Sierra Nevada is already in public ownership, so there is no need for the government to acquire more, Wood said. Plus, there are fears that a new entity would take land from unwilling sellers. El Dorado County Supervisor David Solaro, who backs the Leslie bill, said there is misinformation about the role of conservancies. Some people mistakenly believe conservancies are regulatory agencies like the controversial Tahoe Regional Planning Agency, he said. In fact, the California Tahoe Conservancy, which operates in Solaro’s district, spends 80% of its funding on water quality projects, the supervisor said. Precisely where the Schwarzenegger administration stands on the Sierra Nevada proposals is unclear. The administration reportedly has not been part of legislative negotiations and it has not taken a public position on the bills. In fact, legislative analyses have resorted to quoting the joinarnold.com website, in which Schwarzenegger says he favors a conservancy. Also conspicuously absent is the federal government, which owns more than half the land in the Sierra Nevada. Meanwhile, the proposed Santa Ana River Conservancy has a more modest intent but faces the same locals-versus-state issue. "It’s a fine line to walk," said Pablo Garza, an aide to Assemblyman Lou Correa (D-Santa Ana). Correa is author of AB 496, which would create a Santa Ana River Conservancy. The agency would acquire and manage lands within the river’s watershed for recreation and wildlife habitat, and to improve water quality. Central Orange County is one of the mostly densely developed parts of the state, and it is starved for parks, Garza pointed out. The river "is a potentially great resource that is underused right now. In Orange County, it looks like a sewage ditch," he said. Local chapters of the Building Industry Association oppose AB 496, as do Riverside and San Bernardino counties and several cities. Riverside County opposes the proposal because it could impact potential freeway improvements and a variety of other projects near the river, county spokesman Ray Smith said. Last year, AB 496 stalled in the Senate Appropriations Committee. The bill — as well as the Sierra Nevada Conservancy bills — still must run that gauntlet. No one expects legislation that creates new agencies or programs to have an easy time this session. Contacts: Jedd Medefind, office of Assemblyman Tim Leslie, (916) 319-2004. Clyde McDonald, office of Assemblyman John Laird, (916) 319-2027. Pablo Garza, office of Assemblyman Lou Correa, (916) 319-2069. Steve Frisch, Sierra Business Council, (530) 582-4800. Jaimee Wood, Butte County Farm Bureau, (530) 533-1473. Melinda Marks, San Joaquin River Conservancy, (559) 253-7325. Michelle Baass, Legislative Analyst’s Office, (916) 319-8321.

Architects often talk about the need to design with an awareness of context, but few architects have taken the issue as literally as Richard Matteson. The Los Angeles-based architect has designed a building that, from certain angles, not only fits in with the surrounding landscape—in this case, a lush forest in a Los Angeles canyon—but from certain angles is well-nigh invisible. The result is a design that is well-regarded by both its owner, the Los Angeles Department of Water & Power, and its neighbors. And this modest building, still under development, may indicate an important shift in the relationship between architecture and landscape in a time of rising environmental awareness. Like many public buildings in Southern California, the Stone Canyon water filtration plant is the product of a long negotiation—in this case, 12 years—between neighborhood groups and public officials. The story starts with federal clean water regulations from the 1980s that required water utilities either to enclose reservoirs or to build water filtration plants to ensure water purity. The idea of covering a reservoir did not please the neighbors of Stone Canyon Dam, the scenic centerpiece of a 600-acre watershed just south of Mulholland Drive in Los Angeles. After forming a group known as Coalition to Preserve Open Reservoirs, they formally requested that the Los Angeles City Council block construction. The council recognized the homeowners’ group, and instructed the Department of Water & Power to negotiate with it. In time, the public water company decided to take the reservoir "off line," and thus end the requirement. But the city was still in need of a smaller filtration plant, to purify the overflow from the dam after rainstorms and re-channel the surplus water into the city water system. The final outcome was a decision to build a smaller, 20,000-square-foot plant. In 1987, the utility issued a request for proposals, eventually choosing a team made up of engineering firm Black & Veatch and Richard Matteson, a self-employed architect and veteran of several high-design firms. The biggest practical problem was fitting the building into the hillside. At 20,000 square feet, the proposed building envelope would be "the size of a basketball court with room for bleachers on both sides," according to the architect. A conventionally boxy building would require the destruction of several trees, which neighborhood residents opposed. After long study, Matteson decided to rearrange the two large water pumps inside the building, allowing the architect to reshape the building from a cubic volume into an irregular wedge that would fit more easily into the hillside, while reducing the overall size of the building by 25%. The plan calls for essentially submerging nearly the entire building into the hillside, and covering much of the roof with 12 inches of sod. The footprint of the building is highly irregular, with big scoop-like shapes on its edges, resembling bites taken out of a giant cookie. These "bites" in fact, are places where the building makes room for existing trees on the site. The front elevation, visible only from a frontage road, is made up largely of planters. By law, the building must have two exits. The architect combines these with the air vent towers, which are covered with curving roofs that dampen the sound and redirect it away from hillside houses. Matteson’s design gained ready acceptance from hard-line homeowners. In negotiations, two of the homeowners’ demands were that the building neither attract attention to itself not destroy more trees than necessary, according to Brian Studwell, a director of the Bel Air Association, one of the reservoir coalition’s constituent groups. After three proposed versions, the DWP and the activists agreed on a final design in 1999. Construction is due to start next year. "Everybody who I’ve spoken says `I love it,’" said Studwell. The resulting process and design, he added, is "so unique in the annals of municipal government that DWP has written papers and sends speakers around the country" describing the project. Given the political and esthetic success of the Stone Canyon water filtration plant, historians might someday cite this building as an example of the shifting relationship of the attitude of architects toward nature. Since the Renaissance, Western architects have often combined buildings and landscape into a single, harmonious composition, but the buildings have invariably been the central focus. Later, 20th Century architects, notably Frank Lloyd Wright, took this notion a step further by designing buildings that took advantage of dramatic landscapes as the backdrop for even more dramatic buildings; the most famous example is Falling Water in Pennsylvania—a magnificent building that arguably overpowers its equally magnificent site. This humble Stone Canyon water filtration building (humble in a philosophical sense, not artistically) may not alter our collective slide into ecological crisis, but it does demonstrate an evolving set of values among designers. Matteson’s water plant in Bel Air is that hitherto rare building that gives primacy to the landscape. This gesture may be a sign of our rising awareness of the importance of landscape in the larger scheme of things, where ecology actually is more important than buildings. However, maybe invisibility can be taken too far. "We are getting a magnificent building," said Martin Adams, DWP manager of planning and project management. He cited a comment from a neighboring homeowner. "We are getting a glorious building," she said, adding, "It may be unfortunate that it’s so difficult to see."

Many years ago, overwhelmed by the sheer size of the numbers involved in modern society, humor columnist Russell Baker suggested that we should replace all numbers greater than 10,000 with the word "lotsa." As in, McDonald’s has sold lotsa hamburgers. Social Security entitlements involve lotsa money. A war requires lotsa missiles. We are approaching this point with California home prices. Every month – every week – brings another round of home-price headlines so ridiculous that they seem like something out of , the satirical newspaper. These days, a house in California costs lotsa money. Inevitably, the planning system gets blamed for the mess, and if the economy goes south, you can bet that the building industry will lobby for land-use reform in Sacramento based on the argument that planners have left us with unaffordable houses. But are high home prices really due to planners and their crazy processes? The answer is yes and no – or, perhaps more accurately, no and yes. The recent run-up in prices has occurred not only in the context of California’s typically kooky and complicated planning system, but also in the context of a very peculiar housing market. Let’s take a look. We’ll start with supply and demand. Conventional wisdom suggests that prices are going up because demand is outstripping supply. There is clearly some truth to that argument. But if you look at the supply and demand patterns of the last 15 years – since the last big price run-up – it is clear that more is going on. All through the 1990s, housing experts told us that we were under-producing – building only about half as many houses as the market needed. At the same time, home prices in most of the state were flat all through the ’90s. Now we’re in the opposite situation. Housing production is higher than it has been at any time since the late ’80s. Production is approaching 200,000 units a year, the level housing experts say is needed to meet demand. And there is more variety in new housing, including attached and multi-family units. Yet home prices in California have doubled during the last four years – from a median of around $200,000 to a median of around $400,000 – and show no sign of slowing down. So, what gives on supply and demand? Several things. First, we fell so far behind during the ’90s that supply is still scarce even though production has increased. Second, the current market escalation comes after a decade of flat prices. Sure, prices are double the $200,000 median of four years ago. But median was also $200,000 in 1990, before the recession and real estate bust. If you average the doubling of prices over 14 years instead of 4, that is a 5% annual increase – high but not exorbitant. Finally, the current run-up is due in part to boom time desperation. We must buy now at any price so that we don’t have to pay more later! Then there is home mortgage financing. The way our home finance system is set up, the actual selling price is only one factor. What matters most is the down payment and the monthly payment, the PITI (principle, interest, taxes, and insurance). The days of a 20% down payment are practically over, thanks to mortgage insurance, government programs and various financing strategies that allow people to buy with as little as 3% to 5% down. A small down payment boosts the monthly payment, but the combination of low interest rates, thanks to the Fed, and low property taxes, thanks to Proposition 13, means that the IT portions of the monthly PITI are constrained. Because most buyers qualify for a mortgage based on their ability to cover the whole PITI, it stands to reason that the lower the interest and tax payments are, the higher the principle payment can be. Taking out a 5% loan as opposed to an 8% loan saves several hundred dollars a month. Paying 1% of sale price for property taxes rather than 2% or 3% saves another several hundred. Put the two together and you might have $600 to $800 a month more to throw at the actual purchase price – which, at these interest rates, is enough to leverage another $120,000 to $150,000. If interest rates were higher and Proposition 13 did not exist, California’s $400,000 house would cost $275,000. It would have to because the combined monthly payment would be the same. On top of everything else, steel prices have been going through the roof – not a problem on single-family houses, but increasingly a problem for the multi-story, multi-family projects being constructed under the "smart growth" rubric in urban areas. Steel prices have increased 30% since December and doubled on the spot market. The psychology of demand, the cost of financing and taxes, and the cost of materials are all factors in the quick run-up in home prices. So what about those pesky planning processes that builders always blame? There is no question that planning policies play a role in framing the underlying price structure for California houses. Some communities restrict the number of houses that can be built; planning processes can be long and unpredictable, especially when the California Environmental Quality Act comes into play; and communities have increasingly sought to place the cost of infrastructure on developers through the use of impact and development fees. But have the costs associated with "the system" increased by 100% over the last four years? Of course not. The planning system is not that volatile. It’s more like a constant underlying the housing market. With this in mind, there are a couple of points worth making about the role planning plays – and the role it could play – in housing markets. The first point is that planning policies probably shave some production off the top in a hot market. In the absence of planning and permitting processes, developers would simply let ’er rip in a market like this one, building housing units as fast as possible. Planning processes inevitably slow the pace – which is part of the point of planning, designed to ensure that growth does not overwhelm communities and their infrastructure. The second point is equally important: Planning and permit processes cannot easily stimulate construction in a down market such as we had for most of the 1990s. Builders often argue that if planners would "get out of the way" in a recession, production would go up. But the truth of the matter is that construction in a down market is dampened not by planning, but by financiers unwilling to loan money and builders unwilling to take a risk on reluctant buyers. Sometimes even huge public subsidies cannot force the market to build something the market does not want to build. So, planning processes tend to shave production a little in boom markets and cannot stimulate construction in bust markets. Over time, this probably means slightly reduced housing production. If that’s true, then how can planning and planners better deal with the imbalances and price run-ups that we see today? The answer is simple: Plan well to begin with, and then stick to the plans you make. Planning well usually means resisting short-term economic forces in the service of long-term benefit to the community – focusing on workforce and low-income housing, for example, instead of permitting developers to build only high-end houses. Equally important to planning well is keeping the plans you make. That means allowing developers to build the housing you want when – as now – the market motivates them to do so. One clear cost that planning imposes on developers is the cost of processing time, a cost that can be fatal if it means that developers miss the hot real estate market and must wait years until the opportunity to build arises again. One thing planners can do to help is expedite processing of good projects. Put another way, the best thing local governments and their planners can do to help the housing crisis is not to "get out of the way." The best thing they can do is send clear signals about what they want, and then let developers do the job of implementing the plan when the opportunity arises.

In a remarkable political turnabout, two land use organizations that vigorously fought one another during the 2000 election in Sonoma County have issued a joint report calling for more intensive city-centered growth to protect agriculture and natural resources. San Francisco-based Greenbelt Alliance and the Sonoma County Farm Bureau released "Preventing Sprawl: Farmers and Environmentalists Working Together" at the end of March. As recently as 3 1/2 years ago, the two groups were mortal enemies. At that time, they were engaged in dueling campaigns over the Rural Heritage Initiative, a Greenbelt-backed initiative that would have required landowners to receive voter approval for most rezonings (see , December 2000, October 2000). Greenbelt contended the measure — modeled on Ventura County’s Save Open Space and Agricultural Resources (SOAR) initiative — was necessary to prevent urban development from swallowing farmland and open spaces. The Farm Bureau countered that the measure was unnecessarily restrictive and burdensome to landowners. After a bloody and relatively expensive campaign, 57% percent of Sonoma County voters rejected the Rural Heritage Initiative. After the 2000 election, both sides said, "This is ridiculous," explained Lex McCorvey, Farm Bureau executive director. So representatives of the two organizations began a dialogue. "We just started talking and communicating. We found we could set aside our past differences," McCorvey said. The two sides also found that they held a great deal in common. With a $200,000 grant from the James Irvine Foundation, they spent nearly two years examining local history, studying land use, economic and demographic trends, reaching some conclusions, and making four recommendations. Those are: • Maintain a strong general plan that focuses growth into already developed areas and protects agricultural and natural resources lands. • Support local policies and programs that encourage more efficient use of land within existing urban boundaries. • Encourage Cloverdale to adopt an urban growth boundary. • Extend funding for the Sonoma County Agricultural Preservation and Open Space District. All of the recommendations build on existing policies. Since 1978, the county’s general plan has guided growth into the cities. And during the 1990s, voters approved urban growth boundaries for every city except Cloverdale, a small town along Highway 101 near Mendocino County. Voters also approved the countywide open space district and a half-cent sales tax to fund its activities; the district and tax are set to expire in 2011. But the report says that without bolstering those policies, growth pressure will spill onto the farmland and community separators that provide for a $600 million-a-year agricultural industry and draw 4 million tourists annually. "We have to do better on density," said Kelly Brown, Greenbelt’s Sonoma-Marin field representative. "We have to use land more efficiently within the urban growth boundaries." Based on Department of Finance growth projections, Sonoma County’s population will increase from 456,000 in 2000 to about 750,000 in 2040, necessitating the construction of 115,000 new housing units. "Under the city-centered growth model," the report concludes, "Sonoma County’s cities could accommodate 90% of the predicted population growth (265,000 persons) if they increase the average people per acre for new developments from 7 to 17." Initial reaction from elected officials and other community leaders has been positive, said Brown and McCorvey. But both recognize that not-in-my-backyard battles lie ahead without further public outreach and education. Still, there appears to be momentum growing for a more intense use of land within the cities, and the organizations appear eager to play a role in future land use decisions. Plus both Greenbelt and the Farm Bureau, after some initial hesitation, are happy to have new a new ally. "Adversarial roles don’t work," McCorvey said. "It’s all a matter of the evolution of a community." Contacts: Lex McCorvey, Sonoma County Farm Bureau, (707) 544-5575. Kelly Brown, Greenbelt Alliance Sonoma-Marin Field Office, (707) 575-3661. Greenbelt website (which contains report): www.greenbelt.org

An environmental impact report for a water pipeline project near Jackson has been rejected because the water agency in charge did not explain the reason why it concluded that a potential impact was not significant. The potential impact was to six streams that are fed during the dry season by leaks in an earthen canal, which the Amador Water Agency proposed to replace with a pipeline. Without water from the leaks, some of the streams would dry up altogether during the summer and early fall, according to the EIR. " ontrary to CEQA requirements, the EIR fails to explain the reasons why the agency found the reduction in stream flow would not be significant," Justice Ronald Robie wrote for the Third District Court of Appeal. The Amador Canal is a mostly unlined ditch that carries water 23 miles from Lake Tabeaud to Tanner Reservoir in the Amador County foothills near Jackson. The canal was originally built in 1870. Amador Water Agency proposed replacing the ditch with an 8-mile-long pipeline to improve water quality, reduce water loss and boost reliability. In May 2001, the agency adopted an EIR and approved the pipeline project. The EIR said that surface flows in parts of six streams would decrease to varying degrees from June through October, making some of the streams intermittent during drier years. In particular, Jackson Creek would become intermittent "during August and September, and possibly October, in all but the wettest water years." Nevertheless, the EIR concluded the hydrological impacts were less than significant. The EIR reached the same conclusion regarding impacts to riparian vegetation. A group called Protect the Historic Amador Waterways sued the agency, contending that the agency failed to analyze and mitigate significant effects to stream hydrology and riparian vegetation. Amador County Superior Court Judge Susan Harlan ruled for the agency. Project opponents appealed, and a unanimous three-judge panel of the Third District overturned the lower court. The water agency had relied heavily on thresholds of significance, which the California Environmental Quality Act and the CEQA Guidelines permit lead agencies to use to determine whether an EIR is required and, if so, whether a possible impact is potentially significant. The agency further relied on a portion of the Guidelines, §15064, subdivision (h), that the Third District invalidated in , (2002) 103 Cal.App. 4th 98 (see , January 2003; , December 2002). Interestingly, Justice Robie — then a Sacramento County Superior Court judge — had originally stricken § 15604, subdivision (h) at about the same time the agency adopted the EIR. The court rejected the guideline because it allowed an agency that had adopted thresholds of significance to rely on them solely, and not have to consider a "fair argument" that an impact was potentially significant. The court said the fair argument standard remained in place. The water agency had adopted thresholds of significance based largely on the "Environmental Checklist Form" and "Environmental Information Form" in appendices G and H of the guidelines. Based on those thresholds, the agency determined the project would not have a significant impact. Project opponents contended that the sample questions in those forms were too narrow and were irrelevant to the pipeline project. The Third District said it could not determine which side was correct because the agency provided no basis for its conclusion. " fter explaining how construction of the pipeline would ‘affect existing local hydrology’ by reducing surface flow in several streams, turning some of them into seasonally intermittent streams, the EIR simply states that ‘the change in local hydrology associated with dewatering the Amador Canal and eliminating all leakage is not considered to be a significant hydrological impact per se.’ This assertion is not a statement of reasons, but a bare conclusion. As such, it does not satisfy CEQA requirements," Robie wrote. "A statement of reasons is necessary to assure meaningful judicial review in the event, as here, the EIR is challenged in court." As for impacts to riparian vegetation, the court was satisfied with the EIR’s single sentence of reasoning: "Similarly, the montane riparian vegetation would continue to thrive along local streamcourses, even if canal leakage is eliminated." Project opponents might have challenged the reasoning as lacking substantial evidence, but they did not, said the court, which then sided with the agency regarding habitat. In directing the water agency to satisfy CEQA, the court made clear that "the agency need only correct the deficiency in the EIR that we have identified" and did not have to start over. The Case: , No. C042915, 04 C.D.O.S. 2273, 2004 DJDAR 3291. Filed March 12, 2004. Modified April 9, 2004 at 2004 DJDAR 4414. The Lawyers: For Protect The Historic Amador Waterways: J. William Yeates, (916) 860-2000. For the agency: Alan Lilly, Bartkiewicz, Kronick & Shanahan, (916) 446-4254.

Red flags went up in the environmental community during May 2002 when the Bush administration announced it was forming a task force to "modernize and improve" the National Environmental Policy Act (NEPA). Two years later, release of the task force’s final report suggests that many of the fears voiced by defenders of this landmark federal statute have yet to materialize. Passed by Congress in 1969, NEPA requires the U.S. government to assess the environmental effect of any significant project undertaken by a federal agency, funded with federal money, or requiring a permit from a federal agency. It requires public disclosure of the results of that assessment and a public determination as to whether the benefits outweigh the consequences. In broadest terms, it is the bedrock federal environmental law. It has served as the blueprint for similar laws adopted by half the states, including the California Environmental Quality Act (CEQA). So when James Connaughton, chairman of the White House Council on Environmental Quality (CEQ), authorized creation of the NEPA task force, the response of many environmental groups echoed that of William Snape III, vice president and chief counsel of Defenders of Wildlife. "In sum," he wrote in a letter to the task force, "we believe that NEPA is perhaps the most critical of all federal environmental laws, and assert its procedures are effective and efficient when utilized in good faith. The adage ‘don’t fix what ain’t broken’ possesses poignant relevance here." The CEQ, which operates in the Executive Office of the President, was established by NEPA and charged with promulgating NEPA regulations applicable to other federal agencies, and with resolving disputes among federal agencies regarding NEPA compliance. The council comprises three members appointed by the president and subject to Senate confirmation. Critics of the Bush administration’s environmental policies grew alarmed when Connaughton — a former lobbyist for mining companies and the Chemical Manufacturers Association — directed the task force to look into expanding the use of "categorical exclusions" by which federal agencies can declare certain types of projects exempt from environmental analysis, and to review the "balancing of public involvement and information security" in the wake of the September 11, 2001 terrorist attacks (see , November 2002). Environmental organizations viewed the comment regarding the "balancing" of public involvement and security needs as an attempt to undermine NEPA and quash public involvement. In their view, the Bush administration had made its aims clear in this regard by seeking to exempt logging plans from analysis and public review under the guise of fire prevention, to expedite review of some transportation projects, and to exempt federal activities from NEPA if they occur in offshore waters. Critics of the administration also were alarmed by the hurried nature of the task force’s work: It initially imposed a 45-day deadline to collect public testimony and was to issue its final report by the end of 2002. The public comment period, however, was quickly extended another month. Ultimately, the task force received written comments from more than 650 individuals, organizations, agencies and tribes. And the final report was not released until September 24, 2003, after which the CEQ commenced a series of four, two-day regional public hearings at which it invited comment on the report’s recommendations. Those regional meetings were conducted on Squaxin Island in the state of Washington, and in Pennsylvania, Tennessee and Colorado between October 2003 and January of this year. Rather than a blow to the heart of NEPA, the final report is largely a compilation of procedural minutiae. The recommendations include: • Sponsoring meetings, conferences, and workshops to coordinate information sharing. • Clarifying the appropriate role of technology in communicating during the NEPA process to enhance public involvement. • Establishing a committee to advise CEQ on how it might improve training for government employees involved in NEPA activities. • Developing a "Citizen’s Guide to NEPA." • Emphasizing the importance of collaboration as agencies expand the use and scope of programmatic NEPA analyses. • Developing criteria for agencies to use when evaluating whether a programmatic document has become outdated. • Convening a work group to consider how adaptive management techniques might be incorporated into the NEPA process. • Clarifying how to determine whether a new categorical exclusion is appropriate. • Issuing new guidance to specify the requirements for environmental assessments (EAs) and findings of no significant impact (FONSIs). Although they are not mandatory or legally binding, the task force recommendations may very well improve coordination of NEPA activities among various federal agencies, and improve public communication and involvement by taking advantage of technologies such as the Internet, which were unavailable (and perhaps unimaginable) when President Nixon signed NEPA into law in 1970. Judging by the response that has greeted the report, however, it appears unlikely that the task force recommendations, even if incorporated into NEPA policy directives by CEQ, will have much effect on the day-to-day application of the law. Environmental groups have largely been silent regarding the final report, and the testimony collected during the public reviews indicates a wary endorsement of the task force’s general recommendations with respect to greater public involvement and clearer, more consistent application of NEPA requirements from one federal agency to another. In public comments filed with CEQ separately from the regional meetings, the only mainstream environmental organization to respond to the final task force report, the National Parks Conservation Association, concluded that the recommendations, in general, are sound. The parks association specifically endorsed several of those findings, such as the development of a citizen NEPA handbook; clearer coordination of NEPA with other federal environmental statutes; more explicit guidelines for EAs, categorical exclusions and FONSIs; and greater public involvement in the NEPA process. "If there is any clear, overarching message from Squaxin Island," the facilitator of the October meeting concluded in a final report on the proceedings, "it is that NEPA is an eloquent law that was perhaps ahead of its time. Although we were not trying to reach consensus on any of the issues, there was a clear consensus that the National Environmental Policy Act had served the nation well and needs no amendment. As one panelist noted, ‘NEPA is old, but so is the U.S. Constitution.’ " Contacts: NEPA task force final report: Council on Environmental Quality National Parks Conservation Association, (202) 223-6722.

Long a land of big dreams and failed schemes, California City has lured a major automobile company to town with a redevelopment deal and environmental planning assistance. In March, Hyundai Motor America started building a test track and related facilities in California City that will employ about 100 people, which would make Hyundai the second largest employer in town. The project does have detractors, though. Some landowners contend the city has abused its redevelopment and eminent domain powers, while some environmentalists argue that the project does not adequately mitigate impacts to two rare animal species. The city aggressively defends itself against such accusations. City Manager Jack Stewart pointed out that a federal district court ruled for the city in a lawsuit brought by property owners, and a habitat conservation plan for the desert tortoise has been accepted by state and federal agencies. Still, litigation on a number of fronts is continuing. In the meantime, contractors are grading, paving, building and installing utilities for the 4,340-acre test track facility, which includes a 6-mile-long oval track, a hazard course and 20,000-square-feet of engineering and test buildings. Construction is scheduled for completion this fall, according to Stewart. California City is located in southeastern Kern County, a little north of Edwards Air Force Base. With 203 square miles of the western Mojave Desert within its boundaries, California City is the state’s third largest city behind Los Angeles and San Diego. But California City has only about 11,500 residents. There have been a number of plans for large-scale development along the lines of Palm Springs since the city incorporated in 1965, but little has come to fruition despite the construction of 600 miles of roads and the city’s open-for-business attitude. By far the largest institution of any kind in California City is a 2,600-inmate, minimum security federal prison. About 530 people work at the prison. A few years ago, California City began work on annexation of 29 square miles on its southern flank. City officials could see that growth in the area would more likely be along Highway 58, east of the City of Mojave — and not north up Highway 395, as envisioned earlier, Stewart said. The annexation brought the city limits to Highway 58. At the same time, the city detached 29 square miles on its north side. Neither of the large tracts was developed, but the land the city detached was higher quality habitat, Stewart said. The city also added the new territory to its redevelopment project area, which already covered most developed parts of town. Along the way, Hyundai officials contacted the city about the proposed test track. Hyundai reportedly liked California City because it offered a large, contiguous site and is within a few hours drive of the company’s design center in Irvine. Under the deal eventually worked out, California City’s redevelopment agency and Hyundai will split tax increment 50/50 over 10 years to reimburse the Korean company for the cost of building roads and water lines, according to Stewart. The redevelopment agency assembled about 200 parcels covering 1,000 acres. Most landowners willingly sold to the agency, which then sold the land to Hyundai. However, the city has pending eminent domain suits against about a dozen holdout landowners. The city also agreed to include the Hyundai test track in the EIR for the annexation and redevelopment project area extension. The city worked with the U.S. Fish and Wildlife Service to arrange an Endangered Species Act "take" permit for the threatened desert tortoise, and a state "take" permit from the Department of Fish and Game for the Mohave ground squirrel, which is on the state’s threatened species list. In exchange for the city’s assistance, Hyundai will employ about 100 people in jobs ranging from security guard to engineer, Stewart said. Honda has a similar test facility in unincorporated Kern County that has proven to be a stable employer, he said. The Hyundai project will also generate tax increment although Stewart declined to estimate how much. Hyundai is reportedly spending $50 million to build the test facility. The federal take permit is part of a habitat conservation plan (HCP) that addresses only the desert tortoise and the Hyundai site. The Fish and Wildlife Service adopted the HCP in January. It calls for offsetting the loss of tortoise habitat acre for acre by protecting land elsewhere. Hyundai has purchased 3,387 acres adjacent to an existing tortoise preserve and has established a $1.5 million endowment. Tortoises found on the site (at least two dozen have been located) are supposed to be moved to protected land. Additionally, the state Department of Fish and Game has required Hyundai to offset every acre of lost ground squirrel habitat with 2.3 acres of protected land elsewhere. In February, the Center for Biological Diversity and Defenders of Wildlife sued the Fish and Wildlife Service over the HCP. The groups characterized the site as "pristine desert wildlands" and said the HCP does not do enough to protect the tortoise. Center for Biological Diversity ecologist Daniel Patterson said a better site selection process would have placed the test track elsewhere. "In the same region there is a bunch of old, trashed ag land with little habitat value," Patterson said. While the environmental litigation is only getting started — and settlement talks have already commenced — litigation over redevelopment and eminent domain activities is deep in the legal system. Project opponents filed a validation action regarding California City’s expansion of redevelopment project area borders. A Kern County Superior Court judge threw out the suit on procedural grounds, but in March the Fifth District Court of Appeal overturned that decision and the case is headed back to Superior Court for trial. The lawsuit questions whether land in the 15,000-acre addition to the city’s redevelopment project area is blighted and primarily urbanized, as required by state redevelopment law. The city based its findings on the fact that there are numerous odd-shaped lots with multiple owners, and the parcels are not adjacent to roads or utilities. The city also found that the lots are of inadequate size for development and were created by an old land fraud scheme. But June Ailin, of Kane, Balmer & Berkman, who represents landowners challenging redevelopment and one holdout property owner, said many parcels in the area are 10 to 20 acres apiece, "not postage stamp lots that nobody can do something with." She added, "What they are saying is that absence of infrastructure equals blight. But absence of infrastructure does not equal blight. It’s vacant nothing surrounded by vacant nothing." California Redevelopment Association (CRA) Executive Director John Shirey said he did not know a great deal about the California City project. But he said, "I get concerned whenever I hear about wide-open desert land being called blighted and designated for a redevelopment area. … It needs to be urbanized and it needs to be part of an area that has seen better days." In fact, the use of redevelopment to build shopping centers and golf courses in the Coachella Valley desert led to the 1993 reform of state redevelopment law — reforms that CRA backed and that appellate courts have interpreted tightly. Stewart, though, makes no apologies. The city’s actions met the definition of redevelopment law, he said. "My desire would be to extend it a lot further," Stewart said. Contacts: Jack Stewart, California City, (760) 373-8661. June Ailin, Kane, Balmer & Berkman, (213) 617-0480. Daniel Patterson, Center for Biological Diversity, (520) 623-5252. Project environmental assessment and habitat conservation plan: Hyundai HCP

Mitigation measures taken after the issuance of a mitigated negative declaration do not satisfy the California Environmental Quality Act, the Second District Court of Appeal has ruled. In a case involving a water district’s proposal to cover a small reservoir in the unincorporated Santa Barbara County community of Summerland, the court also ruled that the district should have considered the project’s potentially substantial impact to aesthetics. At the behest of the state Department of Health Services, the Montecito Water District in 1998 decided to cover the 4-acre Ortega Reservoir with an aluminum roof to preserve water quality. The district conducted an initial study, which identified flooding as a potentially significant impact because of runoff from the impervious roof. Rather than prepare an environmental impact report, the district adopted a mitigated negative declaration (MND) that said the project "shall incorporate design measures" to detain runoff and meter its release "so that no modification to the downstream 100-year floodplain will result." The 11-home Ocean View Estates Homeowners Association was not satisfied and filed a CEQA suit against the district. Santa Barbara County Superior Court Judge James Brown ruled for the district. The association appealed, and a unanimous three-judge panel of the Second District, Division Six, reversed the lower court. The association argued that the mitigation measures themselves may have significant impacts, including contaminating drinking water and even causing the dam to fail. Ocean View pointed to reports by two engineering consultants to the district that raised the possibility of drinking water contamination and dam failure, and that recommended design changes which the district apparently accepted. But the mitigated negative declaration did not mention either potential impact. In a very straightforward opinion, Presiding Justice Arthur Gilbert said that the water district erred. "The district argues that changes in the project design have mitigated to insignificance the potential for contamination and dam failure. That may be true, but the argument misses the point of environmental review," Gilbert wrote. "Environmental review derives its vitality from public participation. That is what is missing here. The public was never informed of the significant impacts discussed by the district’s consultants. Those impacts were omitted entirely from the review process. "The district argues that design changes should not require environmental review. That argument also misses the point," Gilbert continued. "Mitigation measures stated in a MND need not specify precise details of design. Having recognized a significant environmental impact and having determined that mitigation measures may reduce the impact to insignificance, the MND may leave the details to engineers. In such a context, the design may change many times without requiring further environmental review. Here, however, the MND fails even to recognize the problem. Nothing in the MND requires any measures to mitigate contamination or dam failure." The court then turned to the issue of aesthetic impacts and what constitutes substantial evidence of an aesthetic impact. The court described the reservoir as a "very large swimming pool trying to pass as a lake" and as a striking visual feature. The view of the lake from private property would be lost, but, because of additional landscaping, the roof would be obscured from all homes except two. People on public trails would also be able to see the roof. Ocean View property owners expressed concern about the aesthetics, and Santa Barbara County requested "appropriate mitigation measures" if the roof could be seen from surrounding homes or recreational trails. The district argued that the loss of private views is not significant under CEQA — an argument the court flatly rejected. The number of private views affected might figure into significance of the impact, according to the court, but in this case the view from public trails also is impacted. The district then argued that homeowners’ and the county’s "expressions of concern, questions and objections" do not constitute substantial evidence for CEQA purposes. But the court said those were enough. "Consideration of the overall aesthetic impact of the cover by its very nature is subjective," Gilbert wrote. "Opinions that the cover will not be aesthetically pleasing is not the special purview of experts. Personal observations on these nontechnical issues can constitute substantial evidence. … If it were merely the matter of expressions of concern by one or two people, we might agree that there is no substantial evidence of a negative impact. But here the county urged the district to adopt mitigation measures if the cover can be seen from public or private view areas." Thus, the court concluded, there was substantial evidence to support a fair argument that the project could have a negative aesthetic impact, and the mitigated negative declaration was not adequate. The Case: , No. B162920, 04 C.D.O.S. 1842, 2004 DJDAR 2738. Filed March 2, 2004. The Lawyers: For the association: Herb Fox, (805) 899-4777. For the district: David K. Hughes, Price, Postel & Parma, (805) 962-0011.

Owners of the San Remo Hotel in San Francisco have lost the latest round in their 11-year litigation over the city’s ordinance restricting the conversion of residential hotels to tourist use. In the latest decision, the Ninth U.S. Circuit Court of Appeals declined to rule on the hotel owners’ takings claims because the state Supreme Court had already decided the claims. Because the state court had ruled, the Ninth Circuit panel said it was precluded from revisiting the same questions. "The facial and as-applied takings challenges raised in state court are identical to the federal claims asserted by the plaintiffs, and are based on the same factual allegations," Judge Michael Daly Hawkins wrote for the Ninth Circuit. "The California Supreme Court decision was a final judgment on the merits." Attorneys for the San Remo said they would ask the U.S. Supreme Court to accept the case. They believe the high court could take the case because there is a split amongst the circuit courts on "issue preclusion." Last year, the Second U.S. Circuit Court of Appeals decided to "part ways with most of our sister circuits" and, in a case similar to the San Remo litigation, ruled that the federal court should consider the property owner’s claims even though the state court had ruled on them. That case is , 342 F3d 118. The Ninth Circuit declined to follow the decision and instead relied on U.S. Supreme Court and Ninth Circuit precedents. The controversy over San Francisco’s regulation of residential hotels started during the late 1970s, when a shortage of affordable housing became acute. In 1981, the city adopted a hotel conversion ordinance (HCO) — which the city amended in 1990 — that prohibited the conversion of residential units to tourist use unless hotel owners replaced the converted units with new affordable housing or paid a mitigation fee. When the ordinance first took effect, the San Remo was classified as a 62-unit residential hotel based on a survey of the hotel operator. The hotel owners, Thomas and Robert Field, later disputed that classification, saying they always provided a majority of rooms to tourists. City officials stuck with the residential classification and said the Field brothers would have to pay $567,000 — equal to $9,000 per room, or 40% of replacement costs — to convert the hotel to tourist use. The owners eventually paid the fee in protest but they also filed a lawsuit in federal court alleging that the law itself and the city’s application of the law amounted to a taking of private property. The Ninth Circuit eventually kicked the case to state court. That decision became known as . , (9th Cir. 1998) 145 F3d 1095; see , July 1998. On the state court side, the trial court ruled for the city before a state appellate court said the lower court used the wrong criteria. In what became , the state Supreme Court then ruled 4-3 for the city. , 27 Cal.4th 643 (2002); see , April 2002, October 2000. The big issue in was whether to extend the "heightened scrutiny" requirement of the and line of cases to San Francisco’s hotel conversion ordinance. The state Supreme Court ruled that heightened scrutiny — which requires a close relationship between the exaction and the project’s impact — did not apply to laws of general applicability, such as the HCO. After the state Supreme Court ruling, the San Remo owners returned to federal court. District Court judge D. Lowell Jensen ruled against the hotel owners for a variety of reasons. The property owners appealed and a unanimous three-judge panel of the Ninth Circuit upheld the lower court. The hotel owners argued that the doctrine of issue preclusion did not apply because they were forced into state court. Under , 473 U.S. 172 (1985), property owners must seek compensation for takings in state court before proceeding in federal court (see , February 2004). Additionally, in San Remo I, the Ninth Circuit granted the hotel owners’ request for a " abstention," based on the 1941 case that requires a plaintiff to obtain a definitive ruling in state court before returning to federal court. , 312 U.S. 496. And the hotel owners said they had reserved their federal claims. But the Ninth Circuit ruled that the reason the hotel owners were in state court did not matter. Judge Hawkins cited , 136 F.3d 1219 (9th Cir. 1998): "There is, in short, no reason to believe that Congress intended to provide a person claiming a federal right an unrestricted opportunity to relitigate an issue already decided in state court simply because the issue arose in a state proceeding in which he would rather not have been engaged at all." Instead, what mattered to the Ninth Circuit was whether the state Supreme Court answered the same questions that the hotel owners were raising in federal court. Hawkins noted the state Supreme Court said it was construing the state and federal constitutional takings provisions congruently. Moreover, the state Supreme Court’s analysis and decision not to apply heightened scrutiny was "equivalent to the approach taken in this circuit," Hawkins wrote. Instead, the state Supreme Court used the "reasonable relationship" test, which is the same one the Ninth Circuit would use. Thus, the court concluded, " ederal takings claims are barred from litigation under the doctrine of issue preclusion." The Case: , No. 0315853, 04 C.D.O.S. 3231, 2004 DJDAR 4585. Filed April 14, 2004. The Lawyers: For San Remo: Paul Utrecht, (415) 956-8100. For San Francisco: Andrew William Schwartz, City Attorney’s office, (415) 554-4620.

A state appellate court has refused to block the City of San Francisco’s plan to lease former state highway property to a nonprofit agency for development of an affordable housing project. A First District Court of Appeals, Division Four, panel voted 2-1 to uphold a lower court’s ruling against project opponents, who contended the city plan violated state law that limited the use of the property. In 1989, the Loma Prieta earthquake damaged the Embarcadero Freeway (Route 480), forcing the highway’s closure. Two years later, the state Legislature approved a bill that became Streets and Highways Code §72. It obligated Caltrans to demolish the damaged freeway, transfer the right-of-way to the city and jointly agree with the city on a new system of ramps and streets that would provide motorists with comparable access (see , May 1997; , February 1991). In exchange, the city was obligated to use the right-of-way — or the proceeds from sales of the right-of-way — for an alternate street system. In the years that followed, Caltrans gave the right-of-way to the city, and the city, state and federal governments developed a plan for a replacement street system known as the Mid-Embarcadero roadway project. In January 1999, the Board of Supervisors adopted a resolution "approving in principle" the disposition of three parcels of the former right-of-way. The city designated one of those parcels for affordable housing development, with proceeds from the lease or sale contributing to the required streets. The city then began negotiating with Chinatown CDC, a nonprofit housing and community development corporation. In late 2002, the city approved a $10.1 million loan for development of the project, and Chinatown CDC soon signed an agreement to lease the property for 99 years for $10,000 per month, an amount that the city acknowledged was below market rate. A group called Citizens for Better Streets filed a lawsuit attempting the block the project. The group contended that the fair market value of the property was more than $9 million and that the fair lease rate for a 50-year lease (the length originally proposed) was more than $700,000 annually. The group contended the city’s plan was a waste of property and money, and was not allowed by §72. The city responded that the road project was essentially completed, in part with funds from the below-market lease. In March 2003, San Francisco Superior Court Judge Paul Alvarado declined to issue the preliminary injunction sought by Citizens for Better Streets. Judge Alvarado found that the group was unlikely to prevail in the suit because the city had complied with §72. Citizens for Better Streets appealed, and the First District upheld the lower court’s decision. The key to the case was the interpretation of §72, subdivision (b)(1), which states that the city shall "utilize the Route 480 right-of-way or the proceeds from the sales of that right-of-way for the sole purpose of constructing an alternate system of local streets …" Citizens contended that subdivision required the city either to build replacement streets on the property or sell the property at market value and use the proceeds for road construction. But the First District ruled that the city did comply with the terms of §72. "Nothing in the statute requires a sale at market value, or on any other particular terms," Justice Patricia Sepulveda wrote for the court majority. "The city did not use the parcels as an actual site for the project, but it has adopted a resolution stating that the proceeds from their disposition will be applied to pay for the project. The city’s proposed actions therefore appear to comply with the letter of § 72." Citizens also pointed to Article 19 of the state constitution, which limits the use of properties purchased with gasoline tax revenues. But the court said Citizens provided no evidence that the properties here had been acquired with fuel taxes. In a dissenting opinion, Presiding Justice Laurence Kay, said that the city had complied with neither the spirit nor the letter of the law. "In effect," Kay wrote, "the majority reads into the section <§72> the right of the city to make a gift of the land to a developer for a purpose which, praiseworthy or not, is stunningly different from that purpose for which the land was conveyed to the city." Kay also cited a 1993 report jointly prepared by seven city agencies that determined using the right-of-way for low-cost housing would "clearly conflict with the basic purpose of the land transfer." That conclusion was correct, Kay wrote. Even though project opponents lost the case, their attorney Andrew Zacks asked that the opinion be published. Having the opinion published slightly increases the chances that the state Supreme Court will accept the case, said Zacks, who has filed an appeal based largely on the dissenting opinion. The Case: , No. A102773, 04 C.D.O.S. 2596, 2004 DJDAR 3755. Filed February 26, 2004. Ordered published March 25, 2004. The Lawyers: For Citizens: Andrew Mayer Zacks, (415) 956-8100. For the city: Andrew William Schwartz, city attorney’s office, (415) 554-4620.

A San Diego County resident has lost a lawsuit that sought to force a developer to improve a private road that serves a new subdivision. The resident argued that under the Subdivision Map Act, San Diego County had to enforce its own laws that carry out the Map Act, including a code section addressing off-site road standards. But the Fourth District Court of Appeal ruled that the county had the authority to approve an exemption from those standards and had expressly exempted the subdivision. In 1995, a developer sought approval of a tentative map for a 28-lot subdivision on 127 acres in the unincorporated northern San Diego County community of Bonsall. A private road, Via Maria Elena, provides access to the site. A neighboring property owner, Garner Anthony, contended that the developer should widen the private road and improve a bridge. But in November 1995, the county’s Planning and Environmental Review Board approved the tentative map without Anthony’s requested road improvements because the public works director had determined the road was satisfactory and because the proposed improvements were prohibitive due to excessive amounts of cut and fill that would be needed. Anthony appealed the decision to the Planning Commission, arguing that Via Maria Elena was substandard, narrow and meandering, and that under San Diego County Code § 81.402, which concerns standards for private roads serving major subdivisions, the county must require the road to be improved to county standards for private streets. The Planning Commission denied the appeal, and no further appeal to the Board of Supervisors was filed. Barratt American, Inc., acquired the project and sought approval of a final map. In January 2001, the Board of Supervisors approved the final map and a subdivision approval agreement, which was required to ensure Barratt completed all tentative map requirements. The subdivision approval agreement did not include improvements to Via Maria Elena. Thirteen months later, Anthony sued the county and Barratt. San Diego County Superior Court Judge Lisa Guy-Schall ruled for Anthony and ordered Via Maria Elena to be improved to county standards for private streets. The county and Barratt appealed, and a unanimous three-judge panel of the Fourth District, Division One, overturned the lower court. The appellate court first addressed the county and Barratt’s contention that Anthony could not pursue the lawsuit because he had filed it after the Subdivision Map Act’s 90-day statute of limitations and because he had failed to exhaust his administrative remedies with the Board of Supervisors. The Fourth District agreed but went on to consider the merits of the case anyway. The court did so because Anthony argued that his suit was not an attack on the project maps but was instead based on contract interpretation. Anthony contended that the Subdivision Map Act incorporated local code, such as § 81.402, into the requirements imposed at the tentative map stage. The county could not waive the requirement at the tentative map stage, and the Board of Supervisors should have rejected the final map for failing to comply with the county code, he argued. The county and Barratt countered that the county could waive the conditions of § 81.402 when it was impossible or impracticable for a subdivider to comply — and that the county had expressly waived the requirement when it approved the tentative map. The court agreed with the county and Barratt. "Read in context of the entire regulatory scheme (including Government Code § 66474.1), San Diego County Code § 81.402 does not create or support a mandatory duty to require the Via Maria Elena offsite road improvements, when a decision was made otherwise, through the proper channels. Accordingly, we must reject Anthony’s theory that the tentative map approval must be deemed to have included an implied condition of fulfillment of all existing separately imposed requirements of the San Diego County Code," Justice Richard Huffman wrote for the court. " e cannot disregard the discretion conferred upon the county director of public works to make exceptions to the application of county standards." Anthony argued that under Subdivision Map Act, the subdivision improvement agreement required compliance with local ordinances, including § 81.402. The county had an ongoing duty to comply with its own rules and regulations, including at the time of final map approval, he contended. But the court concluded that Anthony’s inference did not apply. "We conclude the language of the subdivision improvement agreement does not support an interpretation that the parties intended to contravene the prior findings of the director of public works, as approved by the Planning Commission, that the Via Maria Elena offsite road improvements were not required to be accomplished by Barratt," Huffman wrote. Moreover, the court held, the Board of Supervisors under the Subdivision Map Act could not add conditions to the final map that did not exist at the tentative map stage. " pproval of the final map by the board is a ministerial duty, if all the tentative map conditions have been met," Huffman noted. "Anthony has failed to show that the requested offsite road improvements to Via Maria Elena were imposed expressly or impliedly as tentative or final map conditions of approval. The contrary is true." The contractual and statutory rights to road improvements that Anthony sought did not exist, the court held. The Case: , No. D041676, 04 C.D.O.S. 1950, 2004 DJDAR 2865. Filed March 4, 2004. The Lawyers: For Anthony: Arthur Wilcox, Feldhake, August and Roquemore, (619) 696-8788. For the county: C. Ellen Pilsecker, county counsel’s office, (619) 531-6229. For Barratt American: Jeffrey Chine, Luce, Forward, Hamilton & Scripps, (619) 236-1414.

The bankruptcy of Pacific Gas & Electric Company has resulted in a stunning windfall for the state. As part of a bankruptcy settlement approved in April, PG&E agreed to offer conservation easements or title to 140,000 acres of land, most of which lies around the utility company’s hydroelectric system. The settlement creates a new Pacific Forest and Watershed Land Stewardship Council to oversee the lands, which cover about 980 parcels in 21 counties from Shasta County in the north to Kern County in the south. Additionally, PG&E must provide $100 million — $50 million for river restoration, reforestation and recreational improvements, $30 million for urban youth programs, and $20 million for planning. The board of the stewardship council is to be composed of state agency representatives, and appointees from interest groups as varied as the Association of California Water Agencies and the Trust for Public Land. The board is supposed to "make each decision by consensus." The Public Utilities Commission will maintain some level of oversight. The first meeting of the stewardship council was scheduled for April 29 in San Francisco. The settlement charges the council with writing a "land conservation plan" that preserves or enhances "beneficial public values." Among other things, the plan is supposed to figure out how to provide revenue to counties so that land transactions are "tax neutral" for each county. Under the settlement, PG&E and other holders of water rights will maintain those rights. Also, PG&E gets to keep its hydroelectric facilities. PG&E assembled its land holdings and system of dams beginning in the 19th century. Most of the lands are in the Sierra Nevada, with concentrations along the Pit, Feather, Yuba, American, Mokelumne and Stanislaus rivers. Over the decades, the reservoirs and adjacent forest lands became popular with boaters, anglers, campers, and hikers. Some PG&E lands also have provided grazing and timber harvesting opportunities. Many of the PG&E properties abut public lands, and the boundaries are often obscure. Prior to filing bankruptcy in April 2001 — a move that followed the energy mess wrought by deregulation — PG&E sought permission from the PUC to auction its lands (see , January 2001). That proposal drew protests from numerous federal and state agencies, environmentalists and outdoors groups. They feared the properties could get chopped up and developed, harming habitat and water quality, and bringing urban development to remote areas. A 4,100-page environmental impact report prepared by the PUC identified many potential negative consequences of the auction. The proposed auction apparently found no favor in the bankruptcy court. Instead, disposition of the lands became part of the overall settlement, which became final in April. Although not exactly a "gift" of land, PG&E’s land conservation commitment appears to be one of the largest transactions of its type in U.S. history. Backers have compared it to the creation of a new national park or monument.