A coalition of San Francisco tenants' groups has won the needed four votes from county Supervisors to place an "anti-speculation tax" initiative on the city and county municipal ballot in November. The initiative, which would impose a 24-percent tax on investors who sell rental housing within five years of purchase, is the latest attempt of long-time city residents to beat back the waves of rising rents and housing values in what has become the nation's most expensive housing market. The anti-speculation tax may carry an extra emotional charge for some of its supporters: a similar proposal was one of the last projects of legendary gay rights activist and San Francisco Supervisor Harvey Milk before he was assassinated in 1978. The umbrella group campaigning for this November's ballot measure, known as the Anti-Displacement Coalition, includes the San Francisco Tenants' Union, Causa Justa/Just Cause, Eviction Defense Collaborative, Housing Rights Committee, and the Chinatown Community Development Center. However sympathetically we may view the frustrations of working-class and middle-class people facing rapidly rising housing prices, it seems unlikely that either the initiative process or other political efforts can control gentrification and runaway real estate speculation. Part of the reason is the law and another part concerns the nature of cities and investment cycles.  Although nobody can predict elections, it is plausible, if far from certain, that the anti-tax initiative could squeak through in November. The city population has a plurality of renters, most of whom are unable to move from their rent-controlled units into other rental properties; in San Francisco, a one-bedroom unit can command $3,500 in monthly rent. Even for a non-lawyer like the present writer, the anti-speculation tax seems unworkable. One does not have to be a glassy-eyed supporter of property rights to realize that a 24-percent tax on a private investment is onerous. Even if foes of gentrification can see a clear public purpose in punishing short-term investors, the law probably does not. Then there's the equity issue: Why would housing investors be subject to a punitive tax, while owners of other forms of investment real estate would not share a similar burden? How would the law handle cases of mixed-use developments that combine housing with retail, office, childcare and health clinics? For example, would the law require the owner to pay a full 24 percent of the sale proceeds of a mixed-use property? Or could the owner negotiate a partial payment, based on some arcane formula, such as the percentage of the total square footage devoted to housing, perhaps, or the percentage of income that the rental housing units contribute to the total cash flow? And then there would be loopholes for people who inherited property and wanted to liquidate their estates within five years. What would stop those heirs from forming limited partnerships with real estate investors? And so on. Even if the law survived a constitutional challenge, which is unlikely, it would be full of loopholes as a piece of French lace. The deeper problem is the nature of cities. Cities are dynamic places where change is axiomatic. The dirty secret is that cities live on money. Successful cities are those that are able to attract a steady flow of investment in private homes, rental housing, commercial space and public areas. In a sense, cities are fossil records of the periods of greatest investment, because those periods are when the greatest amounts of construction and re-construction occur. And current levels of investment, like it or not, make the difference between San Francisco and Detroit. In a perfect world, cities would experience just enough investment to maintain property values while discouraging neighborhoods from deteriorating into slums. But investment is not rational, and the current phenomenon of investment in Bay Area housing is a case in point. This is an overheated housing bubble. Bubbles do not last. Real estate is cyclical by its nature: Bust follows boom every four or five years; the prolonged recession in recent years was a rare exception. Long-time Bay Area residents will recall that the Dot-Com Boom, the boom that promised to change the rules of the economy forever (alas for days gone by!) was followed by the Tech Wreck. That collapse in values left many offices and storefronts suddenly empty South of Market, together with tens of millions of square feet of office space in throughout the Bay Area and Silicon Valley. People lost their jobs or could no longer afford to live in the Bay Area. At one point, San Francisco residential vacancies approached 10 percent. The same fate awaits the current tech-driven housing bubble. Something will inevitably spoil the run-up in prices. For starters, technology is mercurial. Apple, Google, Oracle and Adobe, inconceivable as it sounds, may all lose market share and pull back at some time in the future. Intel and Microsoft, formerly viewed as bulletproof, have already lost ground; Blackberry and Nokia, market leaders in their time, are much diminished. Does anyone remember that Cisco Systems was the highest cap stock at one point? Beyond the fortunes of technology, a national or global recession could dampen the market. So could, God forbid, the unexpected shifting of continental plates. The only certainty is that the market will cool and values will drop somewhat. It's true that San Francisco has been Manhattanized and that the social cost is high. So far, it's proven difficult or impossible to legislate a certain kind of urban quality, at least in America. The law seems largely indifferent to urban quality, which can mean different things to different people. (Personally, I'm attracted to messiness, crowding and near-insoluble infrastructure problems, but I realize this is a personal taste.) Alas, the trickle-down theory, justly maligned in macro-economics, may be applicable to cities: Where there's money, there are exciting shopping streets, exciting new buildings and preservation, and hot new districts. And bountiful tax proceeds bring in public money for museums and parks. In short, cycles of reinvestment and disinvestment are the cost of remaining a money-center city. As in nature, the presence of too many nutrients for one species may cause one part of an ecosystem to grow too quickly, to the detriment of a balanced system. That overgrowth, in turn, brings about a correction over time. The process, which may appear chaotic from short range, may look more orderly from a distance. It's true that the San Francisco of Alfred Hitchcock's Vertigo has become a theme park for the rich. I'm not particularly happy about it. On the other hand, I haven't booked a hotel room in Detroit for a long time.

"Walkable urban places" or "WalkUPs" became an instant buzz word with the release in June of a new report by LOCUS, the real estate development and investor advocacy organization of Smart Growth America. As discussed on the CityLab (formerly Atlantic Cities ) site at http://bit.ly/T7maRu, the report said 558 WalkUPs exist in the 30 largest U.S. metro areas. It focused on demand for more such areas, saying they tend to have higher GDPs per capita and house more young college graduates, and office space within them "commands a 74 percent rent-per-square-foot premium over rents in drivable suburban areas." The report is at http://www.smartgrowthamerica.org/locus/foot-traffic-ahead/. San Jose approves Diridon Plan for Caltrain/HSR hub The San Jose City Council has approved a plan for a 250-acre transit terminal complex in downtown San Jose, intended most immediately to anchor the Caltrain from San Francisco, and eventually to welcome both a BART extension and the statewide High-Speed Rail line. The plan calls for massive office, commercial, residential and hotel space. The plan is at https://www.sanjoseca.gov/index.aspx?NID=1743. Streetsblog SF reported at http://bit.ly/TetxX8 that the final version adopted requirements that press the nearby SAP Center sports arena to reduce spectators' reliance on cars, and included, as a goal, the much-debated restoration of nearby Los Gatos Creek as a public amenity. The Silicon Valley Business Journal has details at http://bit.ly/1vUIE6G. Statute of limitations bars college tree-cutting protest California's First District Court of Appeal ruled June 17 that community college administrators were within their rights to have more than 200 trees cut down on the College of San Mateo campus. In an opinion heavy on procedural history, the court found the challenge brought by Citizens for a Green San Mateo was time-barred because the group did not raise it until they saw the trees being cut, by which time 30-day and 180-day deadlines to object under Public Resources Code  § 21167 had passed. The case is Citizens for a Green San Mateo v. San Mateo Community College District . The online docket is at http://bit.ly/1pydQF3, opinion at http://www.courts.ca.gov/opinions/documents/A137612.PDF. San Mateo Daily Journal coverage is at http://bit.ly/1jdLiN8 and detailed legal discussion by Miller Starr Regalia's "CEQA Developments" blog is at http://bit.ly/1l7f8CW. SF utility boxes exempted from CEQA The First District issued a publication order May 30 for its April ruling upholding CEQA exemptions for 726 AT&T utility boxes to be installed on San Francisco sidewalks. The case is San Francisco Beautiful v. City and County of San Francisco , opinion at http://www.courts.ca.gov/opinions/documents/A136546.PDF. Water bond vote fails; reconsideration likely With the June 26 deadline for legislative ballot measures approaching, the SB 848 water bond proposal by Sen. Lois Wolk failed to obtain a two-thirds majority in the California Senate on June 23. The LA Times has details at http://lat.ms/Tsj5vF. The day before, Senate President Pro Tem Darrell Steinberg told interviewer Conan Nolan on the LA area's KNBC-TV (http://bit.ly/1sy3xq9) that polling showed a bond measure would fail with voters if it funded a north-south transfer of California water through the Delta tunnel project, so he was advocating for Wolk's measure, which funded other types of projects. The Association of California Water Agencies predicted reconsideration and further negotiations would follow. See http://bit.ly/1pcBYkE. Online, the Maven's Notebook weblog and its linked Twitter account are following the issue closely. Capitola may adopt General Plan update The city council in the coastal town of Capitola holds a hearing July 26 to consider adoption of its proposed General Plan Update. The Santa Cruz Sentinel reports at http://bit.ly/1v2yv5F that emphases include the 41st and Bay Avenue commercial corridors, tensions between new and old development, parking and sustainability. See http://www.plancapitola.com/ for details. Stockton starts General Plan update process Stockton's City Council has authorized the start of a two-year general plan update process as the city recovers from its 2012 bankruptcy. Officials said the focus would be on economic development downtown and in the south of the city. See http://bit.ly/1l7AyQk for details from the Stockton Record and http://bit.ly/1nCyJwb for the city's planning process documents. SB 1129 post-redevelopment cleanup bill still in play The Assembly Local Government Committee has passed Sen. Steinberg's SB 1129, a bill to help successor agencies make new commitments to projects and use bond proceeds once they have received findings of completion from the state. For the League of California Cities analysis and tracking page, see bit.ly/R32Jc8. The official bill tracking page is at http://bit.ly/1yKvf3y. San Francisco's Ellis Act bill fails in committee After squeaking through the State Senate, Sen. Mark Leno's SB 1439 bill to restrict San Francisco evictions under the Ellis Act was defeated June 18 in the Assembly. On June 24, Leno publicly said he would abandon the bill for the current session but would probably bring it back next year. (See http://bit.ly/1lnX507.) The bill had appeared to enjoy massive support from venture capital investor Ron Conway and members of his Sf.Citi tech industry civic coalition, as shown by the long lists of tech business endorsements appearing in legislative analyses at http://bit.ly/Pp54wc. The bill was generally opposed by rental landlords' organizations and the California Building Industry Association. For more details see the San Francisco Chronicle at http://bit.ly/1q5rfrV. Milpitas settling its redevelopment disputes The city of Milpitas is reportedly near settling its especially difficult post-redevelopment disputes with the State Department of Finance. The City Council approved a settlement June 17 calling for the city to pay over $41 million to the state and make sales and transfers of properties whose ownership had been uncertain in light of disputed relations among the state, city, and successor agency. The Mercury News has details at http://bit.ly/1lOzeHS. New challenges to Sacramento arena plan With some previous lawsuits recently disposed of, new opposition to the Sacramento arena proposal has surfaced. The Sacramento Bee reports at http://bit.ly/TfUHN6 that opponents brought a CEQA challenge to the project in early June, questioning the constitutionality of SB 743, which provides special environmental review concessions to the project. The Bee reported at http://bit.ly/1nCDLc8 that housing and environmental advocates were considering a separate lawsuit to seek larger mitigation contributions to housing, transit and small business.

Citing to sweeping, venerable core case law on the civil rights of individuals in public places, the Ninth Circuit on June 19 overturned Los Angeles' Municipal Code Sec. 85.02 statute against use of vehicles for habitation. The ruling in Desertrain v. City of Los Angeles potentially reduces city governments' control over the uses and appearance of public spaces. On the other hand it enhances the ability of people who have lost conventional housing to use their vehicles for some of the purposes of a home, rather than face the riskier, more stereotypically "homeless" situations of lugging possessions by hand on city streets or relying fully on institutional shelters and services. The Ninth Circuit opinion, by Judge Harry Pregerson, found the Los Angeles ordinance unconstitutionally vague on the grounds that "Plaintiffs are left guessing as to what behavior would subject them to citation and arrest by an officer," and that the ordinance encouraged arbitrary and discriminatory enforcement against homeless people. The opinion reviewed the circumstances of four plaintiffs cited and arrested for allegedly living in their cars during a Venice-area enforcement campaign in fall 2010. (Seven plaintiffs are named in the caption, but a footnote explains that some received parking tickets while parked with disability placards, and the parties agreed those tickets were a mistake.) In all of the described cases, the cited parties kept possessions in their vehicles, but two slept in their vehicles at night only while parked on private property by permission. A third, warned against sleeping in his car, "then began sleeping on the sidewalk, which is legal," and at times slept in a shelter. The fourth, when arrested, insisted he was not sleeping, but was told "that sleeping is not the only criteria for violating Section 85.02." The opinion further recounted evidence of conflicting understandings among city officers about the meaning of the ordinance. It said that while legitimate health and safety issues were raised about the conditions in which vehicle campers were living, "some of the conduct plaintiffs were engaged in when arrested -- eating, talking on the phone, or escaping the rain in their vehicles -- mimics the everyday conduct of many Los Angeles residents." It concluded that the law "is so vague that it fails to give notice of the conduct it actually prohibits," and as interpreted by city police, was "incompatible with the concept of an evenhanded administration of the law to the poor and to the rich that is fundamental to a democratic society." The opinion quoted at length from Papachristou v. City of Jacksonville , the exceptionally literary 1970 Supreme Court opinion by Justice William O. Douglas that overturned, as void for vagueness, old-style vagrancy laws that formerly authorized arrest for statuses such as unemployment and for ill-defined offenses such as "loitering". Pregerson was joined in the opinion by Judges Marsha S. Berzon and Morgan Christen. Their decision overturned a 2011 district court ruling that had backed the city and arresting officers in cross-motions for summary judgment. As a threshold matter, the Ninth Circuit found it proper to consider the plaintiffs' vagueness challenge to the ordinance, raised in the Plaintiffs' motion, although they did not raise the vagueness aspect of their constitutional argument until after filing their first amended complaint. The local district court had refused to consider the merits of the vagueness challenge. Mark Ryavec, head of the Venice Stakeholders Association, and a campaigner against campers on Venice streets, complained to the Los Angeles Times , "It leaves people who are mentally ill, criminally inclined or lethal on your doorstep and removes any possibility the police can do anything about it." The decision does not necessarily grant blanket permission to sleep in vehicles in all circumstances. Vehicular residents are potentially affected by many laws, including parking restrictions, vehicle codes, and disorderly-conduct statutes that prohibit many kinds of living activities on public property. It remains to be seen how much Desertrain may hold back the use of such additional measures. However, the case has already been recognized as having important effects throughout California. William Abrams, a consulting professor at Stanford who has represented vehicular residents in Palo Alto, told a local paper he thought the holding "will apply completely if we were to have to go to court" over Palo Alto's ordinance against vehicle sleeping. Activist attorney Carol Sobel, who represented the plaintiffs, told the KPCC radio station that since her clients did not sleep in their vehicles on public property, the case for them was principally about the ability to use vehicles on a public street in the daytime without being singled out for having certain kinds of property in their vehicles. She said in the radio interview that all four of her clients had been arrested under the invalidated statute, which was defined as a misdemeanor, and two lost their vehicles to towing. Asked whether tolerating vehicle habitation created sanitation concerns, or whether it reduced pressure to provide real housing, she said the answer to needs for sanitation and for housing wasn't to put people in jail. Los Angeles City Attorney Mike Feuer told the press he would not appeal the decision but would seek to redraft the ordinance instead. He told the LA Times, "We need to make a break from the past ... and commit ourselves to grappling with the issues that create homelessness in the first place." Links: Ninth Circuit Desertrain opinion: http://cdn.ca9.uscourts.gov/datastore/opinions/2014/06/19/11-56957.pdf Papachristou v. City of Jacksonville : http://laws.findlaw.com/us/405/156.html LA Times : http://lat.ms/1nRqyz4, http://lat.ms/T3Akmm KPCC (SoCal Public Radio): http://bit.ly/1j4mW8G AP: http://bit.ly/1nwDyHr Guardian (UK) : http://bit.ly/1roYtQq Palo Alto Weekly : http://bit.ly/1lKKzsw Wall Street Journal : http://on.wsj.com/1rd9DYp

A companion measure to SB 69 is making its way through the State Legislature to help cities that, like Jurupa Valley , were hit by the 2011 budget cuts just when they had agreed to serve new areas, though with respect to annexations rather than incorporations. AB 1521, sponsored by Assemblyman Steve Fox (D-Palmdale), would benefit cities that, as of 2011, had recently completed annexations of inhabited county lands and had been expecting state support for their increased service levels. It would commit state General Fund money to reinstate fee allocations that previously came from vehicle license fee (VLF) funds. Lobbyist Jason Gonsalves, who represents several Riverside County cities, said the new legislation would provide $4 million a year to cities to pay for service costs in those recently annexed areas. AB 1521 differs from SB 69 in offering a future source of revenue for ongoing costs, as opposed to SB's 69 narrow focus on making up for past cuts to four Riverside County cities. "It's not to restore funding lost, but to give them a way to cover services in areas they annexed," Gonsalves said. VLF funds were taken from the cities in 2011 when the state sought new sources of revenue to pay for prison realignment. At the time, many of the affected cities responded by cutting public safety costs. A legislative analysis of the new bill said $4 million in cuts affected a number of cities, including Chico, San Ramon, Santa Clarita, Temecula, Fontana, San Jose, Porterville, Tulare and Visalia, that had annexed inhabited areas. The measure might also encourage other cities to do infill annexations, Gonsalves said. Although it would raise funding for cities throughout the state, AB 1521 hasn't won the support of the influential California State Association of Counties. According to legislative summaries it does have support from several city governments and county LAFCOs, and from the League of California Cities. AB 1521 passed the Assembly in May and goes to a State Senate Governance and Finance Committee hearing on June 25.

California's youngest city, which has fought for survival since its formation, is still in critical condition, but lately there are signs it has moved off life support.     Jurupa Valley, a Riverside County city of 95,000, was expecting death by disincorporation earlier this year because it could not replace a lost source of funding for new towns. But the city has been able to postpone plans to disincorporate for another year due to increased tax revenue and budgetary changes. And hopes have emerged for its longer-term future via state-level efforts.     The City Council voted to disincorporate in January 2014, with the expectation that within two years they would complete the first official unmaking of a California city since the 1970s. (See prior CP&DR coverage in the December monthly issue and online at http://www.cp-dr.com/articles/node-3427.) But now, city officials are saying they have enough money to last until the third quarter of 2016, when the city's payments for services are due to Riverside County.     The city is still looking to Sacramento for its longer-term salvation, hoping state legislators will approve a key bill and that Governor Jerry Brown will sign it into law. Local efforts to win Brown over have begun, including organizing schoolchildren to write to the Governor's dog.     What does all this mean for other California communities that want to incorporate? It means that the state hasn't completely righted itself following financial troubles that hit hard in 2011, and while something may be done for existing new towns, there is still not enough funding to help new cities get started.     "There's no mechanism to incorporate unless residents want to vote to immediately tax themselves," said Jurupa Valley City Councilwoman Laura Roughton.     In the halcyon days of old, cities could count on state Vehicle License Fees (VLF) to help pay some of their initial costs as they were created, before they developed their own tax bases to fund services. Those funds were wiped out for new towns in 2011 when Brown had the money diverted to prison realignment via that session's SB 89.     Jurupa Valley was hit hardest in 2011. The effective date of its referendum vote for incorporation fell two days after SB 89 went into effect, taking away expected revenue. "The rules were changed midgame, and it's amazing that it all happened," said Roughton. "The other three cities all got at least one payment. We didn't get any."     If the current appeal to Sacramento feels like deja vu, there are good reasons. It's similar to an earlier legislative dance involving the Governor. Jurupa Valley and other new towns also sought state rescue money in 2012 under AB 1098, which Brown vetoed. A further attempt via SB 56 died in the Legislature in 2013. Nothing is certain this year either but the current proposal comes out of a different financial picture and is limited to aiding a few existing new towns -- factors that may give it a better chance of becoming law.     Roughton said cityhood has been good for Jurupa Valley, despite all the financial hurdles. The city controls local land use, and its streets are cleaner, she noted.     Formation of cities helps the state meet other goals, such as providing affordable housing and creating density, said Dan Carrigg, legislative director of the League of California Cities. Incorporated cities also provide public safety improvements and planned communities, said Chuck Dalldorf, spokesman for Sen. Richard Roth, D-Riverside. Roth sponsored SB 56 and is the sponsor of the current bill to aid new towns, SB 69.     "If there's not a solution (to funding new cities), it's unlikely there will be incorporation again in California," Carrigg said.      Four cities in Riverside County, including Jurupa Valley, incorporated around the time when VLF funding was cut off in 2011. They were left with huge debts, and had to cut services deeply. The other three cities, Eastvale, Menifee, and Wildomar, have also been active in the last few years' efforts to recover money from the state that they planned on using for incorporation.     This year the state's fiscal health has improved, and passage of Proposition 30 in 2012 injected $6 billion into the state's budget annually. Government leaders in Riverside County pointed to those events as reasons they might get state money to help them out of their financial mess.     A related reason has to do with reduced competition for funds.     In 2011, SB 89 created new claims on the VLF money by taking it away from new cities and giving it to counties to handle prison realignment, where state prisoners were returned to county jails as a way to decrease overcrowding. So when the AB 1098 proposal in 2012 sought to transfer VLF revenue back to new cities, it created competition for the same money that counties needed for realignment. Groups such as the California State Association of Counties opposed the bill. "We were concerned about undermining realignment revenues," said Jean Hurst, a lobbyist for CSAC.     But as of the November 2012 election, Proposition 30 wrote into law that the VLF money would go to counties, Hurst said. The ballot measure allocated VLF funds to "public safety services" including realignment, so any fresh effort to help new cities had to be made separately from the use of VLF funds. SB 69 proposes to help the new cities out of the state's General Fund, and CSAC is among its supporters.     Another key change between SB 69 and AB 1098 is that it provides money only to cities that incorporated before 2012. The bill would divide about $15 million in start-up costs among Jurupa Valley and the other three newly incorporated Riverside County cities.     As initially conceived, Roth's bill, SB 69, was written to provide funds for all newly incorporated cities that would formerly have been entitled to draw on vehicle license fees for their initial costs. That would have given all future new cities in California the same claims on VLF-substitute funding as the newest Riverside County cities. But recent negotiations narrowed the bill to apply only to cities that incorporated before 2012.     "It was strictly a cost issue," said Roth spokesman Dalldorf. "We'll have to do that after the four-cities bill."     Roughton said Jurupa Valley expects to have more revenue because sales tax projections are higher, and new residences are selling again in the city. Among other things, a new Walmart opened in the city in June.     The city is also taking tentative steps that show it might be around for a while. A new budget adopted in June adds $2 million in new spending for what Roughton describes as "things... cities are required to do."     New spending has been approved for studies the city is required to perform on developer fees, an interim general plan, and examining whether the city should hire its own staff (until now, all city employees have been contractors). The city also plans to increase spending on traffic officers, following several recent local traffic fatalities.     Jurupa Valley received a two-year extension from the state Office of Planning and Research on its general plan, which was due on at the end of 2013. The city is now funding what is being called an interim general plan. It should direct growth for three or four years, according to Roughton. The interim general plan needs to be completed at the end of 2015.     Despite the Jurupa Valley City Council vote to start disincorporation in January,  there has been little followup on the process, other than a few meetings with Riverside County officials, Roughton said.     Hurst of CSAC said Riverside County officials have been helpful to the new cities. "They're essentially floating them while this gets resolved in the legislature," she said.     Roughton said the city has not been able to secure a meeting with Governor Brown, but Brown did acknowledge the four newly incorporated cities' dilemma when he visited the county earlier in the year. He asked his staff to look into the concerns.     In the meantime, Roughton is trying to raise the Governor's awareness of Jurupa Valley issues by getting local school children to write to his dog. "It's all very positive," she said. "We've tried a 'Letters to Sutter Brown' campaign to Governor Brown's dog." The letters "invited Sutter to come and visit. We have a dog park."      Roughton said unlike other cities in the state, Jurupa Valley can't declare bankruptcy. "We don't have any unfunded pensions. We don't have any debts that can be unstructured."     SB 69 will next be heard in the Assembly's Local Government Committee on June 25. Links: CP&DR on Jurupa Valley's 2011 incorporation: http://www.cp-dr.com/articles/node-2901 SB 89, passed 2011: http://bit.ly/1nuB1i6 AB 1098, vetoed September 2012: http://bit.ly/1lJNoKl League of CA Cities response with link to Gov. Brown's veto message: http://bit.ly/1ps1r5m Prop 30, passed November 2012: http://voterguide.sos.ca.gov/past/2012/general/propositions/30/analysis.htm SB 56, died in Legislature, 2013: http://bit.ly/1p6N6Q3 SB 69, currently pending: http://bit.ly/1lhtBAX SB 1521, currently pending: http://bit.ly/1qCEuQQ

Last Friday in San Diego, Gov. Jerry Brown signed the first cap-and-trade appropriation bill as part of the state budget. This means that the Strategic Growth Council will now have $130 million to dole out next year for smart growth planning and related activities – many times more than ever before – and that number is expected to grow rapidly in the years ahead. Coming on top of the SGC's recent award of $16 million in local planning grants, the cap-and-trade appropriation news means it's a good time to take a look at how the SGC has doled out its money over the last few years and what the impact has really been. Up to now, SGC's grants program has been funded primarily by the $90 million for planning contained in Proposition 84, the 2005 initiative that was advertised as the "Safe Drinking Water Act." (The $16 million allocated by the SGC at its meeting on June was the last of the $90 million, so the cap-and-trade money came along just in time.) The SGC was created after Proposition 84 passed. The Legislature subsequently assigned it to distribute the funds in a way that encourages creation of "sustainable communities" under AB 32 -- that is, communities expected to reduce greenhouse gas (GHG) emissions under California's 2006 climate change law, which calls for significant GHG reductions by 2020. The planning funds were doled out in three rounds – 2010, 2012, and 2014 – and in each case the SGC sliced the pie a different way. In 2010, for example, there was a set-aside for metropolitan planning organizations to do modeling. In 2012, there was a category for regional cooperation. In 2014, there was an environmental justice set-aside. (Disclosure: The City of San Diego, where I work, won one of the biggest grants in Round 1 and got one out of the two it applied for in Round 3.) A separate program funded planning and construction of "urban greening" projects. Two external events over the past few years made the SGC grant program more important than it otherwise would have been. The first was the economic crash of 2008, which caused local governments' general funds to shrink and thus made it more difficult for cities and counties to fund their planning efforts. The second was the end of redevelopment in 2012, which robbed local governments – mostly cities – of a funding source they had often used to do plans in specific neighborhoods. Looking at the patterns, there's no question that SGC grants have been used to fund local plans that the cities and counties might otherwise have funded on their own. This was especially true in the first and second grantmaking rounds, before general funds began to recover from the 2008 downturn. (Many of these planning efforts were also funded by similar grant programs from the state's biggest metropolitan planning organizations, which have used either federal or local transportation funds for these programs.) But in the most recent round, something interesting happened: Cities and counties weren't seeking to use SGC grants to replace lost redevelopment planning funds, as one might expect. Instead, local governments and their nonprofit partners are focusing on implementation of previous plans – especially climate action plans – as well as transportation projects. Transportation plans received many grant awards in 2014 after getting virtually none in the first two rounds. The big question, of course, is whether the SGC funds have encouraged cities and counties to undertake planning efforts focused on infill and transit-oriented development efforts that they might otherwise not have undertaken with their own money. That's the whole point of a grant program, after all – to give somebody  money to do something they might not otherwise have done in order to achieve your objective. It's hard to know what cities and counties might otherwise have done if they had more money of their own. Even in the wake of the big economic downturn in 2008, an awful lot of local governments in California continued to start up general plan updates with money that they had squirreled away – but, of course, they had to focus on GHG reductions because of AB 32 and other state laws requiring them to do so. All three rounds of grants have focused on a few basic themes, including: 1. District and corridor plans tied to transit-oriented or infill development. 2. Climate action plans or other efforts to reduce greenhouse gas emissions. 3. General Plan updates focusing on such topics as GHG reduction and healthy communities. General plan updates and district or corridor plans are, of course, the bread-and-butter of local planning in California. And at the time of the first round, most cities and counties in California had realized they had to do some kind of climate action plan in order to comply with new state laws and emerging practices under the California Environmental Quality Act. But here's what's interesting: While the district and corridor plans continued apace among grantees in SGC's third round, the general plan updates and climate action plans slowed down. That's probably because, by 2014, most cities and counties had updated their general plans to reflect the new emphasis on greenhouse gas emissions. In place of General Plan updates and Climate Action Plans, cities and counties – and, in many cases, nonprofit partners working with them – focused on different things in Round 3, including: 1. Implementation of climate action plans and GHG reduction strategies. 2. Transportation plans and projects 3. Energy projects. For example, a number of cities – including Goleta near UC Santa Barbara and the ever-hip City of West Hollywood – got grants to focus on bicycle and pedestrian projects. Several others got grants to focus on various aspects of energy. These were often partnerships at the county level, including in Santa Clara, Sonoma, Butte, Monterey, and Madera Counties. The energy projects ranged from examining community choice aggregation (the ability to use small-scale, community-based energy production to break the hold of big utilities on the energy system) to experimenting with fuel cell technology. The focus on transportation and energy makes sense. Now that most local governments have big-picture plans in place for GHG emissions reduction, they actually have to produce – by switching to alternative energy sources, or by encouraging their residents to switch from driving to walking or bicycling. The shift to walking and biking – what has become known as "active transportation" – is an especially important component in meeting 2020 GHG targets because people can switch modes tomorrow, rather than waiting for big transit projects or major transit-oriented development. But in the long run, GHG reductions after 2020 are likely to depend in large part on those longer-range plans – more transit stops and more development around those stops. That's why cities and counties are still getting a lot of money from the SGC – and from the MPOs in their own grant programs – for district and corridor plans. The built environment takes a long time to change. So as SGC embarks on its huge new program with cap-and-trade money, it will be interesting to see whether this trend continues. Will SGC fund primarily implementation-type plans, such as zoning ordinances and bike/ped plans? Will there be yet more general fund updates to fund? Will corridor and district plans still be popular? Or will SGC push the locals deeper into implementation? Assuming it has hundreds of millions of dollars available in the years ahead, SGC may place a greater focus on actual construction of hard infrastructure, such as bikeways and the public realm components of transit-oriented development projects. After all, with the end of redevelopment these projects are very hard to pay for. Even though the cap-and-trade money is a drop in the bucket compared to redevelopment, the SGC may very well get pushed in the direction of using cap-and-trade money to build public realm amenities and infrastructure, not just funding plans.

Amid a dramatic show of organized public anger, Oakland Planning Commission approved the West Oakland Specific Plan on June 11. City staff, principally planner Ed Manasse, set out the plan's provisions for transit-oriented development, denser use of underused and blighted lots, separation of housing from heavy industry, concessions to second units and home businesses, and more specifically categorized rezoning -- amid shouted objections and boos from a crowd who had marched to the meeting in a protest demonstration. As chair Chris Pattillo reassured, "We can hear you," Manasse attempted to tell activists they had been heard over the course of a six-year negotiation process, even presenting a slide with critics' "Wreck the WOSP!" slogan and broken-insect cartoon. He said, "We've expanded the social equity and affordable housing recommendations, we have additional career pathway strategies for local residents, increased small business opportunities for local residents, youth development education and training, neighborhood retail, and we have additional protections for residents from displacement." "So we heard you," he said. "We know your concerns, we know that there's a lot of people that think that the neighborhood would be better off without a plan at all. That this project is somehow a secret conspiracy, a massive development project and that we are in fact encouraging gentrification and displacement. The plan is exactly the opposite to every – all of that and what we we are trying to do is to explain how that is not the case." The crowd wasn't buying it. The crowd granted applause to speakers, whether activist or business-oriented, who said the plan was not ready for approval, unclear about funding sources for some goals, arbitrarily specific about some requirements and rezonings, and too accepting of upscale condominium development. Robbie Clarke of Causa Justa/Just Cause was among those cheered for saying the plan's stated goals did not translate clearly enough into up-front guarantees of affordable housing and jobs that would be genuinely available to existing residents. Dominique Tan of the East Bay Housing Organizations said activists understood that goals such as inclusionary zoning requirements for developers to fund affordable housing needed to be imposed citywide, not one plan at a time, but she said they needed to happen soon because developers were continuing to build without such concessions. Elaine Brown, a former leader of West Oakland's own Black Panther Party, made an appearance to urge a one-year delay in the plan. She singled out "high in density, expensive housing units that would suck all the air out of" disadvantaged local residents' futures, and called for a plan that would be less friendly to developers and less willing to cause displacement. Strong though less voluble concern appeared for existing small businesses, especially where zoning changes were proposed. Discussion later in the meeting, as some of the public fury subsided, included calls for a proposed tube to enclose the elevated BART train to reduce noise, and even for moving the BART line underground.   The San Francisco Chronicle reported on the scene at http://bit.ly/1pylP54 and noted two arrests at the meeting. Late that night, according to the East Bay Express , a security camera showed masked people in black breaking the windows of the new Kilovolt Coffee shop in West Oakland. http://bit.ly/1lv1k9K. The plan goes to City Council hearings and votes in July. The plan materials are at http://www2.oaklandnet.com/Government/o/PBN/OurServices/Plans/index.htm. The agenda and archived video of the dramatic June 11 meeting are at http://www2.oaklandnet.com/Government/o/PBN/OurOrganization/PlanningZoning/o/Commissions/.

Based on archaeological findings, Native American heritage claims, a "Deny the Ridge" campaign and broad public objections, the Coastal Commission on June 12 discouraged property owner Signal Landmark into withdrawing its "Ridge Project" proposal to build 22 houses on Bolsa Chica Mesa in Huntington Beach. With the Commission leaning toward a "no" vote on the Land Use Plan revision needed for the project, Signal Landmark withdrew its project application, meaning any future construction plan for the site must start again with the local city council. The action preserves natural habitats and protects ancient artifacts -- and by many accounts, gravesites too -- at a prehistoric village complex occupied as much as 9,000 years ago. Heard in the Huntington Beach City Council chambers, the agenda item was well attended and drew fervent speakers in opposition to the project. Signal Landmark, working with developer Hearthside Homes, had offered to mitigate construction on the five-acre "Ridge" site through an agreement to preserve open space on the adjacent six-acre "Goodell Property," which it had an option to buy, plus disputed cultural mitigation proposals. Objectors' letters described the Ridge and Goodell properties as the last two privately owned open-space parcels remaining out of a 30-acre area that, as a whole, showed archaeological signs of supporting dense settlements and receiving hundreds of burials in the distant past. Signal Landmark has already obtained permits for two nearby housing complexes, known as Sandover (16 units, completed) and Brightwater (347 units approved, some as yet unbuilt). The Ridge property, if built up, would extend housing development into an unbuilt area north of the Bolsa Chica Ecological Reserve. A Commission staff letter in the June agenda materials (at http://documents.coastal.ca.gov/reports/2014/6/Th9a-6-2014.pdf) said that when a staff report last December suggested the Ridge site had diminished cultural and habitat value, and recommended accepting the Goodell/Ridge land swap arrangement, arguments to the contrary poured in from scholars, public agencies, environmental activists, Native American organizations and cultural preservation offices. Among these were expert opinions on the site's archaeological importance and its value as habitat for raptors and other species, potentially including burrowing owls. Additional issues raised and disputed included the width of buffers necessary around environmentally sensitive habitat areas (ESHA) and potential drainage effects on an ESHA area of eucalyptus. In this changing light, the staff began to place stricter conditions on their recommendation and the Commission postponed consideration of the matter at the city's request. (See http://lat.ms/1iDEb0b and http://bit.ly/1qnZU46.) Commission staff later shifted their recommendation to oppose the project outright. The richest discoveries of ancient settlement remains and burials have been outside the subject property at sites known as ORA-83 and ORA-85. ORA-83 is also called the "Cogged Stone Site" for its unique gearlike stone carvings, and is on the National Register of Historic Places. Project opponents' letters said all of ORA-85 and most of ORA-83 had already been destroyed by development although a cemetery area of ORA-83 was preserved. Disputed was whether a village site on the subject property, known as ORA-86, had value comparable to the other two sites, or whether the whole area including all three sites should be viewed as a single unit. Many critics of the project said yes, including members and supporters of several bands of Mission Indians, especially the Gabrielino/Tongva and Juaneño/Acjachemen, for whom the site has special cultural and spiritual significance. The local "Orange Juice Blog" headed its report of the proposal's withdrawal, "Most of HB Rejoices!" (http://bit.ly/1lNcZkv) The Bolsa Chica Land Trust site announced simply, "Withdrawn!" (http://www.bolsachicalandtrust.org). Garcia, as Mayor of Long Beach, must leave Coastal Commission Robert Garcia, mayor-elect of Long Beach, must resign his Coastal Commission seat by September 13, according to the state Attorney General's office and the Coastal Commission. The Long Beach Press-Telegram (at http://bit.ly/1q7RPhE) and the Long Beach Reporter have the story in detail, and the typographically eccentric Long Beach Reporter site has posted copies of the relevant letters, by Assistant AG John Saurenman and the Commission's executive director, Dr. Charles Lester, at http://www.lbreport.com/news/jun14/coastcom1.htm. From the letters, the Attorney General's conclusion appears to be that, because Garcia is one of the six members appointed under Public Resources Code Sec. 30301(e), he must be a currently serving county supervisor or a city council member in the Coastal Commission district he represents. As Mayor, he would be neither. Previews June, relatively speaking, was a lull in Coastal Commission business, making it possible to look back and ahead. The meeting looked forward to several expected challenges: The Commission voted to postpone consideration of implementing ordinances to finalize the Marin County Local Coastal Plan (LCP), delaying action for up to a year without setting a definite next hearing date. This spring's other big unfinished LCP, for the Santa Monica Mountains, is expected to be finalized in July through consideration and approval of its implementing ordinances. The Commission also postponed action until August on San Diego's proposed LCP revision, which includes an amendment to the La Jolla Land Use Plan and a limit on access to Children's Pool Beach during seal pupping season. The Commission's Dr. Lester warned that an extra day of hearings might have to be scheduled then to accommodate the interested speakers on the subject. Public interest is high because it pits public use of the pool at the site against concern for seals using the beach as a haulout. A four-day schedule would likely run Tuesday through Friday if one had to be arranged instead of the usual three-day agenda. One speaker on the postponement, Cheri Jacobs Aspenleiter of the RAMP disability rights group, offered a hint of the debate to expect in August. She said she swam in salt water as therapy for a spinal injury -- either by swimming in the public saltwater pool onshore, which she said is immensely valued by people who swim for therapy, or by snorkeling along the coast, where, she said, she had noticed an overpopulation of seals and underpopulation of food species such as garibaldis and mussels. (See http://bit.ly/1q8moU8 on RAMP's campaign to improve disability access to the pool.) A further look toward the future was implicit in the Commission's field trip to the Banning Ranch in Newport Beach, a site of continuing active oil drilling, of mitigation work to fix damage to coastal scrub and, significantly, of a proposal for a 1,375-unit housing development. Since the development is locally opposed, it is expected to come before the Commission at some point. See http://lat.ms/1oAAtfO. Legislation The Commission heard warm public testimony in favor of AB 1102, a measure to protect beach fire rings against removal without a coastal development permit. Even the mayor of Huntington Beach, Matthew Harper, put in a good word for beach bonfires in welcoming the Commission. He said wood fires were necessary on the beach -- not charcoal, which is less warm, or bottled gas, which leaves canisters to break and rust. He called it a beach access issue: "It's too cold to go to the beach after dark unless you have a good beach bonfire to keep it nice and warm for you." The proposal, which is now before the State Senate, responds to a procedural wrangle of litigation and local legislation, described in the most recent bill analysis posted at http://bit.ly/1lxoEiu. On a less cozy note, the Commission briefly discussed AB 976, to give the Commission power to impose fines. That bill last formally moved in 2013, but similar legislation did pass as of June 15 in the Legislature's Natural Resources budget trailer bill, SB 861. (See http://bit.ly/1na4EDS.) Staff at the meeting said fines imposed under the measure would be used to remediate the types of problems caused by the respective violations -- if not always the exact violations occasioning the fines -- and about half of such problems involved public access. As the Sacramento Bee 's Jeremy White noted online, the Natural Resources budget bill also creates a California Climate Resilience Account to address climate change and transfers regulation of drinking water from the State Department of Public Health to the State Water Resources Control Board. "Issue of 'Substantial Issue'" is an Issue Two procedural arguments from the May session spilled into June: one about the power of neighbors to appeal to the Commission, and the other about the power of Commissioners to shut down consideration of appeals. Early in the June session, the result was a tense, technical "discussion item" debate led by Commissioner Jana Zimmer. A big piece of the discussion had to do with what Zimmer termed "the issue of 'substantial issue'." That controversy arose from a debate during the May 15 Commission session (Item 14a) on whether Pullman Ditch, an intermittent stream in a suburbanized patch of Half Moon Bay waterfront, harbored rare Red-Legged Frogs or San Francisco Garter Snakes. Conclusions about the species' presence or absence in turn affected whether property owner Mark Stoloski could build four more houses near the ditch. In response to neighbors' appeal of the Stoloski project, Commission staff recommended that the Commission grant a finding of "substantial issue", which would mean finding that the appeal had sufficient merit to go forward to de novo review. (If staff had recommended against a finding of "substantial issue" they would have made a presentation rebutting the presumption that a substantial issue existed.) Skeptical about the imputed presence in the ditch of rare frogs that had not been directly seen at the site, Commissioner Zimmer raised a procedural question about a long-term standard practice for deciding if enough doubt exists among Commissioners to bother discussing the merits of a recommended "substantial issue" finding. Traditionally, the Commission chair asks for a show of at hands to determine if at least three Commissioners object to a finding of substantial issue in accordance with the staff recommendation. If three hands go up, the chair invites discussion and a vote on the question. Zimmer asked if questions could be posed on an appeal before the call for the show of hands -- significant because that would make it possible for one or two Commissioners who disagreed with a "substantial issue" staff recommendation to highlight flaws in an appeal for other commissioners before any of them took definite positions supporting or opposing de novo review. Zimmer noted Commission rules did not formally provide for the three-hand approach. She was supported on the right to ask preliminary questions by Commissioner Dayna Bochco, who expressed visible exasperation over the variably reported conditions of Half Moon Bay's frogs and ditches. Others chimed in as well. After some fuss it emerged that questions could indeed be asked before the show of hands, and Zimmer asked a few, but Commissioner Kinsey and the staff counsel urged the Stoloski hearing forward to the call for the show of hands -- three of them went up easily -- and thence to a hearing and vote on the presence or absence of "substantial issue." The appeal in the Stoloski matter was rejected by a 9-2 vote of the Commission, hence done with on the spot without a de novo review. In June the Commissioners returned to appeals procedure in a "discussion only" agenda item near the start of the June meeting (June 11 item 6d). Staff had meantime prepared a legal memo outlining Commission appeal procedure (which Zimmer suggested be distributed to all new commissioners) at http://documents.coastal.ca.gov/reports/2014/6/W6d-6-2014.pdf. Several Commissioners reported Stanley Lamport of Cox, Castle & Nicholson, who had represented Stoloski in the Half Moon Bay matter, had weighed in with them ex parte to argue that, although the "no substantial issue" finding is an exception to a presumption in favor of a "substantial issue" finding, that didn't mean the "substantial issue" finding was actually presumed. ("Don't you just love lawyers?" asked Bochco.) Zimmer suggested making it standard procedure to seek questions from Commissioners before calling for the show of three hands. The staff memo set out appeal procedure in another area that saw controversy at the May meeting: the definition of areas where a local resident can appeal a project directly to the Commission as of right. The question came up in May because the Marin LCP converted several types of development on West Marin farmland into principally permitted uses, which are ordinarily not appealable directly to the Commission. Appeals as of right are available within specified distances of riparian or sensitive habitats and between the ocean and the nearest coastal road, whether the permits involved are "principally permitted uses" or not. The clarifying discussion in June, however, wasn't nearly as complex as the original extension of "principally permitted use" definitions had been in Marin in May. The most difficult June procedural discussion concerned the logistical difficulty of providing two Commissioners' signatures to support appeals that are recommended by Commission staff (or by any one Commissioner), as opposed to appeals brought by project proponents or members of the public. The problem -- or one of them -- is that the Commission has only a ten-working-day deadline to appeal any land-use decision by local authorities exercising LCP-delegated coastal permit authority. Commissioners complained that they were sometimes called to provide signatures at the last minute for appeals that they did not have time to read in detail before signing. Zimmer noted she had been constrained as a lawyer from placing a document before a court without feeling a personal sense that its allegations had a basis, and she felt the same about placing appeals before the Commission on staff's assurances. Commissioner Effie Turnbull-Sanders asked if staff could simply initiate their own appeals rather than make last-minute calls on Commissioners: "It may be a little bit of makework if we're called the day that an appeal is due and we're actually briefed by staff" who are better-informed, she said. Commissioner Wendy Mitchell took up the suggestion even though following it through would require a legislative Coastal Act amendment. Commissioner Gregory Cox leaned harder on the problem of logistical pressures on Commissioners to rubber-stamp appeals they had not fully reviewed: "To me it just doesn't sound right." He asked, could staff possibly discuss de minimis project changes with proponents to bring them into compliance without formal procedure? Procedurally a vote couldn't be taken on any of the questions raised, but they remained in the air, presumably deferred to the next legislative session if any. Which left an additional question in the air: whether, if invited to adjust Commission procedure, the Legislature might develop intentions of its own. Otherwise -- Santa Cruz appellant Mark Saito complained of his neighbor's construction permit, "Basically my view is being handed to my neighbor." He suggested that a cypress tree in his own back yard would be more protected if it happened to stand between the houses, so "I know this doesn't concern the Coastal Commission but it seems like the tree has more rights than I do as a neighbor." The Commission made a finding of "no substantial issue," meaning his appeal failed, and neighbors Hassan and Tooran Khayam-Bashi would be getting their permit. During a string of permit appeals on houses in Venice,  among the very last agenda items of June 13, a young father stood up to speak at public comment, surrounded by his wife and young children. He said he came from a family that had lived many generations in Venice but his own family was having to move to Inglewood. He worked in food service, he said, and for people working at food-service wages, "we can't even afford to eat a meal in our own community." He said, "We're getting pushed out and I don't think it's fair." It was not clear if he advocated any particular action on the item at hand. The item was No. 10c: to demolish a single-family house that would be tied to the adjacent lot and refitted with a two-car garage, a "second floor recreation room," a pool and landscaping. The house on the adjacent lot would get a remodel as well. The proposal was approved. The June meeting's agenda, most of it now annotated with vote results, is at http://coastal.ca.gov/mtgcurr.html. It will move to a June 2014 archive link at http://coastal.ca.gov/meetings/mtgpast.html later this month.

The on-time budget bill sent to Governor Brown on Sunday, June 15 contains a deal for use of cap-and-trade proceeds with the high-speed rail funding the Governor wanted and more housing and sustainability money than there might have been. If Brown signs the budget as is, the "Affordable Housing and Sustainable Communities" program will get about $130 million in the 2014-15 fiscal year, out of a total pot of $872 million in cap and trade revenue. Then in future fiscal years starting with 2015-16, the same category will receive 20% a year of the cap and trade proceeds as one of several continuous appropriations. Half of the 20% must go to affordable housing projects designed to reduce greenhouse gases -- or at least, that's stated for the years from 2015-2016 onward. That result exceeds the $100 million for "transit oriented development grants" proposed by the Governor last winter (see http://bit.ly/1pbs4vt) but is a compromise from earlier legislative proposals that had called for as much as $400 million or 40% of cap-and-trade to fund a combination of transit, affordable housing and sustainability projects. Bill Higgins of the California Association of Councils of Government (CALCOG) linked the results to the work of outgoing Senate President Pro Tem Darrell Steinberg, D-Sacramento. Higgins wrote on June 13: "Sustainable Communities and SB 375 related funding is the only thing to come out of the investment plan with the same commitment to ongoing funding as High Speed Rail. That is pretty significant. That is a direct result of Senator Steinberg's effort and leadership." The cap-and-trade budget deal figures appeared first in a Budget Conference Committee handout late June 12, then were repeated in the Assembly floor report at http://ow.ly/y2kOL. The floor report said, "In addition, when the $400 million General Fund Loan from the Cap and Trade fund is repaid, these funds are dedicated to High Speed Rail." Despite Republican opposition to the high-speed rail portion, the same numbers held almost completely steady through the budget negotiations on the completion deadline day, Sunday, June 15. Reportedly, though, Sen. Kevin DeLeon (who has since been elected Senate President pro Tem to succeed Steinberg) publicly mentioned a plan to add "cleanup" language on high-speed rail during the coming week. The figures for 2014-15 were lightly tweaked in the actual main 2014-15 appropriations bill, SB 852 (http://bit.ly/1q6vfpw), as shown by a glance at expenditures from the "Greenhouse Gas Reduction Fund". An expenditure for weatherization that was given in the floor report as $75 million was shaved to just over $70 million. The "$130 million" fund for "affordable housing and sustainable communities" shows an appropriation of $129,201,000. The continuous appropriations of cap-and-trade funds for future fiscal years passed as SB 862, (http://bit.ly/1py6fJT). That same bill adds two new members to the Strategic Growth Council, which is to administer the Affordable Housing and Sustainable Communities funds. The provisions call for one new member to be appointed by the Speaker of the Assembly and the other by the Senate Committee on Rules. These two legislative appointees are to be added to an existing roster heavy on gubernatorial appointees: six state agency heads, the Director of State Planning and Research, and one member of the public appointed by the Governor, who is currently Robert Fisher of The Gap. If, as is likely, the new appointees are local elected officials, their membership on the board could create new complexities regarding conflicts of interest in allocation decisions. The "Affordable Housing and Sustainable Communities" funding is to be allocated to the Strategic Growth Council, with the SGC to decide how to administer the "sustainable communities" funds apart from housing. SB 862 adds a new division, Sec. 75200 et seq., to the Public Resources Code to outline distribution criteria. Projects to be funded would need to be consistent with state environmental priorities and "support implementation of an adopted or draft sustainable communities strategy or, if a sustainable communities strategy is not required for a region by law, a regional plan that includes policies and programs to reduce greenhouse gas emissions". Additionally they would need to fit on a list of project categories beginning with "Intermodal, affordable housing projects that support infill and compact development" and "Transit capital projects and programs supporting transit ridership." The rest of the list is similar to categories proposed earlier in the session as part of the unsuccessful AB 574 (see http://bit.ly/1kwfAu1), but adds emphasis on infill, compact development, "improving connectivity and accessibility to jobs, housing, and services," and serving disadvantaged communities. Under a separate heading, the Transit and Intercity Rail Capital Program and Low Carbon Transit Operations get $25 million apiece in the first fiscal year. From the second year onward they get more: 15% of the cap and trade money, of which 10% goes to transit and intercity rail, administered through CalTrans and the California Transportation Commission, and 5% goes to low-carbon transit operations, to be distributed via the State Transit Assistance formula and administered by CalTrans. All projects must report their progress in reducing greenhouse gases to the SGC and the Air Resources Board. Since 25% of cap and trade funds must benefit disadvantaged communities. The bill calls for CalEPA to work with the Air Resources Board and hold at least one public workshop before identifying which are disadvantaged communities for purposes of the allocation. This involves a revision to the existing Health and Safety Code Sec. 39711 but it hangs on to the existing broad definition of the term in that statute. A broader budget analysis by the Western Center on Law and Poverty noted that appropriations for housing included $100 million for the Department of Housing's Multifamily Housing Program and $10 million for rental and utility assistance for drought-affected households. Further it noted the passage of the Prop 41 ballot measure authorizes $600 million to house veterans and their families. Among minor benefit increases and liberalizations in the CalWORKs program (the new benefit will be $703 per month for a family of three), a $20 million appropriation is to provide "rapid re-housing" assistance. The League of California Cities has a much more detailed analysis of the main budget bill and all the trailer bills for items relevant to local governments, available at http://bit.ly/1q6I7Mo. As the new cap-and-trade budget and allocation program develops in detail, it may be helpful to watch CALCOG's resource page at http://www.calcog.org/index.aspx?nid=96 for postings of further key documents.

A budget deal was reportedly nearing as of Monday night, with the Senate's Darrell Steinberg and the Assembly's Toni Atkins talking optimistically but not too specificially. See http://www.capradio.org/articles/2014/06/09/budget-deal-nears-at-the-capitol/. No clear sign where cap-and-trade proceeds fit into that mix, but the data points include an extended lobbying press conference given June 6 by LA Mayor Eric Garcetti and senior legislators, including Steinberg and his expected successor to the State Senate presidency, Kevin De León. The videotape is available on De León's site at http://bit.ly/1jh2Ac5 -- including Steinberg's quietly gleeful aside as he introduced De León: " I'm terming out of office!" StreetsblogLA put together a graphic explaining the three current public cap-and-trade spending proposals at http://bit.ly/1u075wA. CALCOG's helpful cap-and-trade tracking page at http://www.calcog.org/index.aspx?nid=96 has been updated to include the June 3 State Senate budget hearing's modification of the Steinberg plan, and, most recently, a link to a proposal for a compromise advanced by the Legislative Analyst's Office: http://www.lao.ca.gov/handouts/Conf_Comm/2014/Cap-and-Trade-Expenditures-060414.pdf. All the proposals include hefty funding for transportation and "sustainable communities" funding, but amounts and emphases vary, with the Governor's proposal leaning toward his beloved high-speed rail program, Steinberg's toward affordable housing at transit hubs, and the Assembly's toward broad state and local categories of "Sustainable Communities" funding. New EPA rule could push more states toward cap-and-trade California's cap-and-trade program gained standing as a national model this week because of the federal EPA decision to issue a nationwide proposed rule setting state-by-state carbon caps to be met by 2030. While the rules have been criticized as weakly allowing too much state-by-state discretion, they do create incentives for more states to enter the cap-and-trade business. Ethan Elkind's underwhelmed take on the rules is at http://bit.ly/1u0i6hr, Bloomberg's report is among those seeing a possible boost to regional cap-and-trade markets, but says it's complicated, at http://buswk.co/1kVDftA. The Nation , however, quotes some warnings that an unintended result could be more pressure to use natural gas instead of coal, hence more pressure in favor of fracking: http://bit.ly/1kLE7zZ. The EPA proposed rule itself is at http://www2.epa.gov/carbon-pollution-standards/clean-power-plan-proposed-rule. LA Metro offers new Union Station plan ideas Added ideas for the "master plan" to renovate LA's historic Union Station and surround it with new structures and amenities went public in a presentation June 5, in preparation for a board of directors meeting June 18 of the LA County Metropolitan Transportation Authority (Metro). The plan follows Metro's 2011 repurchase of the station and surrounding property from Catellus, which had owned it since 1990: http://www.greatamericanstations.com/Stations/LAX. The current proposal provides for closer bike and pedestrian connections to surrounding neighborhoods and expanded local transit, and also looks forward to "anticipated future arrival of high speed rail" with plans for a separate terminal to welcome that fabled beast if it ever arrives. Curbed LA has a summary at http://bit.ly/1o84YJP and Metro's own announcement page is at http://www.metro.net/projects/la-union-station/. The text actually released on June 5 appears to be a collection of slides rather than a dense narrative. Metro's own summary appears at http://bit.ly/1wYbYKQ including a grand rendering of the proposed complex "in the future after the Master Plan is implemented." Proposals in the main presentation slide set at http://media.metro.net/projects_studies/lausmp/lausmp_presentation_2014_0605_revised.pdf include a call to expand territory covered by the 1996 Alameda Specific Plan, including east to the LA River and south as far as First Street. San Pablo Avenue Specific Plan would reknit East Bay suburban corridor The San Pablo Avenue Specific Plan, a joint project by the towns of El Cerrito and Richmond, went public for comment June 3 with comments due July 21. The Mercury News has a summary at http://bit.ly/1xBuetW. The detailed plan text and EIR material is at www.el-cerrito.org/spaSP. Goals of the plan include a form-based code, complete streets plan and infrastructure review with a goal of increased attention to public use of outdoor space. Strategic Growth Council grants awarded The Strategic Growth Council awarded $40 million in grants under Proposition 84, including $16 million in the Sustainable Communities Planning Grant category. The announcement is at http://sgc.ca.gov/uploads/2013/05/SGC-Awards-40m-in-Planning-and-Urban-Greening-Grants.pdf. Grant purposes include an assessment of infrastructure needs in disadvantaged areas of Tulare County and the Pioneer Bluff Redevelopment Master Plan in West Sacramento. More special legislation for Tesla As noted last week at http://www.cp-dr.com/articles/node-3505, lots of California officials have been crowding forward to beg the privilege of hosting Elon Musk's "gigafactory" for Tesla car batteries -- amid regrets that the loss of Redevelopment tax-increment financing held back localities from promising tax expenditures to large employers. The Sacramento Business Journal now reports at http://bit.ly/1kLBCxD and http://bit.ly/1qkcIp5 on a new piece of courtship legislation for Tesla, handled as a gut-and-amend of SB 1309, now sponsored by State Sens. Steinberg and Gaines -- a Democrat and a Republican. The current placeholder draft of the bill, at http://bit.ly/1u0hGI1, promises but doesn't spell out "legislation, including, but not limited to, financial incentives and changes to regulatory and environmental processes, to expedite groundbreaking and construction in California of a large-scale battery factory to manufacture batteries for both electric-vehicle and stationary uses." As the Sacramento Business Journal notes, Musk's SpaceX company has already received special exemptions from California property tax under AB 777, which gives up local tax revenue estimated at $1 million. (See http://bit.ly/1o7I8SJ and http://bit.ly/1kVzsfQ). The Board of Equalization backed the exemption by a vote in late May defining certain rockets as "business inventory", hence as excluded from property tax for an additional reason. See http://www.boe.ca.gov/regs/reg_133_2014.htm and http://www.boe.ca.gov/meetings/pdf/2014/052214_F3_Reg133.pdf. Coastal Commission: two big votes postponed, SoCal adjustments on deck A vote to at last approve the Santa Monica Mountains Local Coastal Program is expected to be before the Coastal Commission in July, per an email form the Commission's director, Dr. Charles Lester. The remaining step to complete this long-running project is to approve Los Angeles County implementing legislation -- zoning ordinances and other potentially devilish details -- to implement the Land Use Plan approved by the Commission in April. Back in April, players in the hard-fought controversy over vineyard and farming uses were looking toward the June monthly meeting in Huntington Beach as the likely approval session, but it's not on the June agenda. So it goes to the agenda for Ventura in July. See http://www.cp-dr.com/articles/node-3474 for CP&DR's prior coverage on this issue. Last month's hardest-fought issue, the Marin County Local Coastal Program update, got a land use plan out of the May meeting but it was so loaded with complex last-minute amendments that Commission and county staff have set no date to finish resulting revisions to the implementing legislation. The implementation plan is on the Commission's June agenda only to push back the deadline for completing it to July 27, 2015. Matters on the June agenda include a Huntington Beach redesignation of five acres from open space and agriculture to residential use, a raft of adjustments to the Carlsbad and San Diego Local Coastal Programs and home renovations in Los Angeles County. The discussion-only item for appeals on Wednesday morning's CCC agenda could see some tension over the appeal of a Laguna Canyon live/work project following a site visit by a CCC staff biologist. See http://bit.ly/1n30izT for local reporting on that dispute. The Commission's June 11-13 agenda is currently at http://coastal.ca.gov/mtgcurr.html. And in the sports venue business: San Jose's Diridon Station Area Plan -- available in draft form at https://www.sanjoseca.gov/index.aspx?NID=1743 -- will go to a City Council vote today, June 10, amid complaints from bike and transit activists over what StreetsblogSF called a "parking crater" sought by the SAP Center for its "Shark Tank" hockey arena. For details see http://bit.ly/1qlRyqT. The LA City Council approved a "relatively meager $300 million renovation" of its convention center  that would leave out a sports stadium supported by the NFL: http://bit.ly/1oPjS3B The city's soccer team, Sacramento Republic FC, teamed with a group of nonprofits to back a county sales tax hike for projects including a soccer stadium: http://bit.ly/1hD1Gv7 On May 23, Judge Timothy Frawley, who has ruled in so many heavy-hitting Sacramento county court cases, threw out the current lawsuit against the Kings arena proposal, saying the suit's challenge to the arena term sheet was inappropriate because the term sheet was not binding. See http://bit.ly/1kggsCO. Sacramento Taxpayers Opposed to Pork (STOP) announced it was giving up its campaign for a referendum on the proposed Kings basketball arena, following a rebuff (also by Judge Frawley) some months before: http://bit.ly/1ljKfzc Oakland A's owner Lew Wolff announced he was close to signing a lease extension for the A's to stay in the Oakland Coliseum -- a deal that would further weight Oakland's stadium site choice decision toward the proposed "Coliseum City" model. See http://bit.ly/1oPlpqq for current coverage and http://www.cp-dr.com/articles/node-3476 for Morris Newman's overview of the Oakland stadium venue choices. The Oakland Tribune reported on a blossom of real estate activity nourished by expectations for Levi's Stadium, soon to be home to the ex-San-Francisco 49ers: http://bit.ly/1l2SpYi In Other News: A plan to expand San Francisco's Moscone Center, mostly upward along Howard Street, was before the city's Planning Commission on June 5. For details and links to the massive EIR see Curbed SF at http://bit.ly/1oH715k. Minutes of the meeting aren't posted yet but the agenda is at http://www.sf-planning.org/index.aspx?page=3835 with a note that comments will be accepted until June 16. The SF Business Times describes commercial hopes for the plan at http://bit.ly/1n350NX. The official expansion site is at http://mosconeexpansion.com/. Local real estate blog Socketsite has renderings and comments on an alternative at http://bit.ly/1pePumX. The Yerba Buena Neighborhood Consortium, which has roots in the 40-year-old conflict over demolitions at the site, posted criticisms at http://bit.ly/1s2753s, including an argument that the plan did too little for existing pedestrian safety and sidewalk crowding. Developer Larry Kelley announced a deal to buy and clean up the 240-acre Union Pacific rail yard in downtown Sacramento. The Sacramento Bee reported State Sen. Darrell Steinberg and U.S. Rep. Doris Matsui helped negotiate a deal on toxic cleanup responsibilities among Kelley's Downtown Railyard Venture LLC, Union Pacific as the last active industrial owner, and Inland American Real Estate Trust, which became the owner through a loan default by the immediately prior owner, developer Thomas Enterprises. See http://bit.ly/1oPuvnd for details. The California Supreme Court upheld the use of red-light cameras in traffic prosecutions, saying photos taken by automatic cameras weren't hearsay. Ars Technica has a thorough review of California and nationwide law and controversy on the question at http://bit.ly/TDbGtD. - In May the LA City Council approved a pedestrian bridge between elements of the "Da Vinci" downtown housing development, after criticisms of statements from its proponent, G.H. Palmer Associates, that suggested the bridge's purpose was to separate project residents from homeless people in the neighborhood. http://lat.ms/1jDC1N9 The LA Times reported on renewed neighborhood concerns about "mansionization" in homebuilding as the upper strata of the economy improve: http://lat.ms/1qlF7ey Further to LA planning woes, the City Council agreed to pay $1.75 million in legal fees to the challengers who beat the new Hollywood zoning plan: http://lat.ms/1nv3hmh Courthouse News reports that Kings and Kern Counties, the city of Bakersfield, and three other parties have filed challenges to the EIR on the Fresno to Bakersfield leg of the California high-speed rail plan: http://www.courthousenews.com/2014/06/09/68553.htm

The California First District has issued a publication order for its April opinion allowing a 167-acre Potrero Hills Landfill expansion to go forward on the grounds that a reduced alternative was not "economically feasible." In SPRAWLDEF v. San Francisco Bay Conservation & Development Commission , the appeals court overruled a Solano County judge to find local agencies properly approved the full-scale project. The plan, by Waste Connections, Inc., called for moving Spring Branch, an intermittent watercourse in the "secondary management" grassland area of Suisun Marsh. At issue was whether the expansion had to reduce effects on the existing watercourse, or whether it could move Spring Branch to create greater economies of scale from a larger project. Appeal was from a decision by the San Francisco Bay Conservation & Development Commission (BCDC) because that agency administers the Suisun Marsh Preservation Act, and from a decision by Solano County with respect to local protective planning rules. The Army Corps of Engineers had also reviewed and approved the project. The opinion, by Justice Kathleen Banke, joined by Justice Sandra Marguiles and Justice Pro Tem Diana Becton, interpreted the Suisun Marsh Preservation Act as allowing application of CEQA case law on the concept of a "feasible alternative," hence decided the matter essentially as a CEQA case. In walking through CEQA cases on "feasibility," the court identified the landfill case as comparable to Sierra Club v. County of Napa (2004) 121 Cal.App.4th 1490 in that clear evidence was provided to compare projects' preferred and alternate versions. It highlighted evidence that the smaller landfill alternative, compared to the full-scale project, "would result in a 30 percent reduction in capacity and a 45 percent reduction in revenue." A widely shared analysis by Deborah Rosenthal of Sheppard Mullin has noted that the court accepted the developer's own cost comparisons and gave close attention to their details as the basis for the decision: http://bit.ly/1n2Jqcs Pending since 2003, the landfill proposal has been through multiple environmental reviews, including one in 2009 that considered 20 different alternative plans. Initial legal challenges were brought under the heading "Protect the Marsh" but more recently by another group, SPRAWLDEF. David Tam, cofounder of SPRAWLDEF, is mentioned as a petitioner in the matter from the start. Links: The case is at http://www.courts.ca.gov/opinions/nonpub/A137619.PDF The docket reflects the publication order, a currently pending request for correction/modification, and a petition for review: http://bit.ly/1qkcs9D Sierra Club on environmental concerns and some procedural history of challenges to the landfill, 2007: http://sfbay.sierraclub.org/yodeler/html/2007/03/conservation8.htm BCDC Scientific Panel Review of landfill expansion, 2007: http://www.bcdc.ca.gov/planning/potrero/proposed_potrero_hills_11.shtml Northern California Recycling Association collecting 2012 accounts of a prior stage in the challenge, including one account by petitioner David Tam: http://ncrarecycles.org/NNHotOffThePress2012_12 SPRAWLDEF: http://sprawldef.org/about_us/history__mission_statement Potrero Hills Landfill: http://potrerohills.com/ Waste Connections, Inc.: http://www.wasteconnections.com/ BAAQMD Potrero Hills Landfill file: http://www.baaqmd.gov/Divisions/Engineering/Title-V-Permit-Programs/Title-V-Permits/Solano/A2039/Potrero-Hills-Landfill-Inc.aspx A blog-post with links by two editors of a recent UC Press collection on negotiated environmental management in this natural-looking but heavily reshaped ecosystem: http://californiawaterblog.com/2014/05/01/planning-for-the-inevitable-at-suisun-marsh/

California's Supreme Court heard oral arguments May 28 in Tuolumne Jobs & Small Business Alliance v. Superior Court , preparing to resolve a split between state appellate courts on when a developer's use of the ballot initiative petition process has demonstrated sufficient voter suport to substitute for CEQA review. The case most directly concerns a proposed Wal-Mart expansion in the Tuolumne County town of Sonora. The outcome could have statewide effects on a tactic allegedly used by Wal-Mart in several towns: qualifying a ballot measure for a costly special election as a way to pressure local officials into approving projects. Under Cal. Elections Code Sec. 9214, if 15% of a city's voters sign an initiative petition, the governing legislative body must either "adopt the ordinance, without alteration" or place it on the ballot. In 2010, proponents of the Sonora Wal-Mart expansion qualified an initiative for the ballot supporting a specific plan to authorize the project. The Council chose to adopt the text of the initiative as law rather than send it to a vote. In dispute was whether that decision required CEQA review. The San Francisco Daily Journal reported the high court "appeared skeptical of arguments" supporting the prior ruling, by the Fifth District Court of Appeal, that CEQA review was still required after the Sonora council adopted the petition. The petitioners, Tuolumne Jobs & Small Business Alliance (TJSBA), wrote in their final brief to the high court that the "ploy" in Sonora of Walmart and its proponent James Grinnell "appears to be part of a larger statewide strategy to force financially downtrodden communities into approving their development projects without CEQA compliance, without discretionary review, and without an election by presenting approving the Initiatives as the lesser of two evils." Accordingly TJSBA argued public policy should not allow CEQA review to be replaced by a presentation of 15% of a town's registered voters' signatures plus the sympathy of a local legislative body. The "statewide strategy" claim in TJSBA's brief cited to a broken SFGate link, but apparently referred to a report by Will Evans of the investigative news project California Watch, published in the San Francisco Chronicle in 2011. Evans' report suggested Walmart had been whipsawing local governments by gathering signatures to pressure them into either approving a project verbatim as proposed, without CEQA review, or spending public funds on a special election. See http://www.sfgate.com/bayarea/article/Walmart-wins-big-with-California-initiatives-2291127.php. The last pre-hearing brief by Wal-Mart's attorneys in the matter, of K&L Gates in San Francisco, accused TJSBA of "completely" ignoring legislative histories of the initiative process and of CEQA, and of using public policy arguments to distract from harm threatened by the Fifth District's position to the core functions of the initiative process and the core First Amendment rights of the voters who signed initiative petitions. Grinnell's counsel complained further of "the use of an irrelevant newspaper article to somehow impune (sic) the motives of the Initiative proponent and the voters who signed the Initiative petition." Wal-Mart's and Grinnell's briefs argued that authority descending from Associated Homebuilders, Inc. v. City of Livermore (1976) 18 Cal. 3d 582 established that once a proponent obtained a 15% signature tally for an intiative proposal, CEQA review requirements no longer applied to it. They argued this shut-out was constitutionally necessary to avoid second-guessing the wishes of the petition signers. The Fifth District court, in its 2012 opinion, had called for more substantial review than a 15% voter approval: either a CEQA process or an election. That opinion, by Justice Rebecca Wiseman with concurrences by Presiding Justice Brad R. Hill and by Justice Stephen J. Kane, warned: "Developers' strategy of obtaining project approvals without environmental review and without elections threatens both to defeat CEQA's important statutory objectives and to subvert the constitutional goals of the initiative process." According to the Fifth District, the Sonora council was already considering an EIR for the Wal-Mart expansion, but put the approval vote on hold to consider the ballot measure, and having adopted the ballot measure it did not approve the EIR. The Fifth District would have sent the matter back to the city for further environmental review. (Evans' article viewing the Fifth District's Sonora decision as a setback for Wal-Mart's statewide strategy is at http://californiawatch.org/dailyreport/win-environmental-law-loss-wal-mart-18670.) The Fourth District's 2004 opinion, by Justices Rylaarsdam, O'Leary and Fybel, had taken a directly contrary position in Native American Sacred Site & Environmental Protection Assn. v. City of San Juan Capistrano (2004) 120 Cal.App.4th 961. (See CP&DR's summary at http://www.cp-dr.com/articles/node-547.) That decision treated the role of a city council, once presented with a qualified voters' petition, as merely ministerial -- a mandatory, automatic function, hence CEQA-exempt. The Fifth District opinion asked how that could be so if the council still held the power to choose between adopting the measure or placing it on the ballot. But the Fourth District opinion had asked how the council's function could be other than ministerial if the wishes of the petition signers were to be respected. (The Burke, Williams & Sorensen firm in 2013 posted an analysis on the conflict of authority as it stood after the Fifth District decision at http://bit.ly/UlWsKa. William Abbott of Abbott & Kindermann analyzed the case for CP&DR at http://www.cp-dr.com/articles/node-3298.) The Fifth District opinion interpreted a prior State Supreme Court case, Friends of Sierra Madre v. City of Sierra Madre , (2001) 25 Cal.4th 165, together with CEQA Guidelines Sec. 15378(b), as saying a referendum initiated by a petition -- as opposed to one initiated by a public agency -- could be a way past the trouble and expense of an EIR process under CEQA. Thence it took the backhanded implication that a petition without an election was not sufficient to substitute for the administrative review process. Grinnell's final reply brief argued on the contrary that the Sierra Madre case addressed only the need for CEQA review of a city council's decision to place its own measure on a ballot. It argued the authority of a city council was not comparable to the reserved power of "the people" to "tear through the exasperating tangle of the traditional legislative procedure and strike directly towards the desired end" by bringing an initiative. And in such a case, it argued, the council acted only as "the ministerial agent of the electorate." TSJBA argued, "The results of an election represent the will of the people. A petition signed by 15 percent of the voters does not." Grinnell answered that the reserved initiative power "is not only manifest when an election is held," but also is manifested in "the right to have a duly-qualified, voter-sponsored initiative immediately passed by the local agency". The parties' papers concluded with project proponents exalting the rights of petition signers to be heard and project opponents presenting CEQA as a shield for city councils against corporate bullying. The California Supreme Court docket for the case is at http://bit.ly/Um828m. The prior Fifth District decision is at http://www.courts.ca.gov/opinions/revpub/F063849.PDF. Links to full texts of briefs to the California Supreme Court are at http://www.courts.ca.gov/25993.htm.