The Second District Court of Appeal has thrown out the results of an election in the City of Sierra Madre because the city violated the California Environmental Quality Act. In a December 1999 decision, the court invalidated an April 1998 election in which voters approved a city-sponsored measure that removed 29 properties from the city's Register of Historic Landmarks. City officials put the issue on the ballot as a way of avoiding a study of the impacts of delisting the properties. But the court said that the city's scheme was illegal. "The removal of the 29 properties from City's list of historical landmarks is a project which requires an EIR because it may lead to a substantial adverse change in the significance of a historical resource," Presiding Justice Mildred Lillie wrote for the unanimous three-judge panel. Because the city failed to comply with CEQA, the election was "fundamentally unfair," and the results must be set aside, the court ruled. The court distinguished between ballot measures voluntarily placed on the ballot by a City Council — which is a discretionary action by the council — and ballot measures that qualify via voter petitions. The council's discretionary action is subject to environmental review, while a voter-sponsored initiative can be exempted. The decision clarifies an area of law that had been confused, namely the applicability of CEQA to projects decided at the ballot box, said Susan Brandt-Hawley, the attorney for Friends of Sierra Madre, which filed the lawsuit. "It doesn't make any sense for a ballot issue that involves a discretionary action to be exempt from CEQA," she said. The Sierra Madre City Council, however, has filed a petition for hearing with the state Supreme Court. In 1987, Sierra Madre established a Cultural Heritage Commission and a regulatory process for protecting structures of cultural and historic significance. Ten years later, the city repealed its ordinance and made future listings on the city's Register of Historic Landmarks voluntary. Properties listed on the registry up to that point, however, remained on the list. Later in 1997, a group of property owners petitioned the city to remove their properties from the register. City planners said delisting would require an analysis under CEQA, at a cost of about $2,500 per property. The city did not want to pay for such studies, nor did property owners, so city staff members recommended placing the issue on the ballot. "The attractiveness of this idea is that the initiative and/or referendum is not subject to the provisions of CEQA," a staff report said. Over the objections of the Cultural Heritage Commission, the City Council placed Measure I-97-1 on the April 1998 ballot. In February of 1998, after the sample ballot and arguments had been prepared, the City Council adopted another ordinance intended to "clarify" Measure I-97-1. The city then sent a letter from the city administrator explaining the new ordinance, as well as an analysis from the city attorney. Voters in April of that year approved Measure I-97-1 by a two-to-one ratio. Friends of Sierra Madre then filed suit, alleging the city violated the Elections Code by not including in the sample ballot the February amendment to Measure I-97-1, the revised arguments for and against the measure, and a required legend. Friends also argued the city violated CEQA because it failed to certify an EIR on each of the 29 properties. Los Angeles County Superior Court Judge Robert O'Brien rejected the CEQA arguments but ruled for Friends regarding the Election Code violations. The city appealed over the Elections Code decision, while Friends appealed the CEQA ruling. The appellate court overturned O'Brien. The court found no violations of the Elections Code. The city's last-minute letters to voters and the extensive public debate ensured that voters knew what they were deciding, the court ruled. However, the appellate court said the city did violate CEQA. In its detailed opinion, the court first dealt with the status of historical resources. Justice Lillie quoted Public Resources Code §21084.1, " uildings ‘included in a local register of historic resources … ' are presumptively historical resources unless the preponderance of the evidence demonstrates otherwise." Because there was no hearing regarding the 29 delisted properties, they were presumptively historical resources, Lillie reasoned. Delisting the properties would be a change in legal status that "may then lead to a change in the significance of that resource." Lillie wrote. Activities that could change the significance of these historical resources, such as alteration or relocation, require a CEQA review, and city officials knew this, Lillie wrote. "Indeed, it is abundantly clear that City submitted Measure I-97-1 to the voters precisely because it believed that such a course of action would create an exception from the requirements of CEQA." The court then addressed CEQA Guidelines §15378 subdivision (b)(3), formerly subdivision (b)(4). This portion of the Guidelines appears to exempt ballot measures from CEQA. However, the court said that the Guidelines are quite narrow and deal specifically with issues decided in Stein v. City of Santa Monica, (1980) 110 Cal.App.3d 458. In that case, the court ruled that the city's act of placing a citizen-sponsored initiative on the ballot was not subject to CEQA because the city was undertaking a ministerial act, and no discretion was involved. That exemption did not apply for Sierra Madre, the court ruled. " he project here encompassed more than submitting a ballot measure to the voters; City here took essential steps culminating in the de-designation of historical resources. In addition to placing a measure on the ballot, City undertook several discretionary actions which committed it to the de-designation of 29 properties at issue in this case. City thus ‘approved' a project subject to CEQA," Lillie wrote. The City Council resolution placing Measure I-97-1 on the ballot qualified as a "project" subject to CEQA. The city should have conducted environmental review beforehand, the court ruled. In its argument before the court, the city relied heavily on Lee v. City of Lompoc, (1993) 14 Cal.App.4th, 1515. In that case, the court ruled that CEQA did not apply to a special election to amend Lompoc's zoning ordinance to permit shopping center development. The court said CEQA would apply to the ultimate project after zoning changes were made. But the Second District said Lee did not apply in the Sierra Madre case because in Lee, the city had already commissioned an EIR. The Lompoc City Council put the issue to voters only because it was deadlocked over the proposed shopping center. "In this regard, the most that Lee properly can stand for then, is the rather banal proposition that when a project has undergone CEQA review, but final approval of the project is sought by ballot measure, the decision to place the matter on the ballot does not itself trigger another CEQA review," Lillie wrote. The city also argued that CEQA does not authorize the court to invalidate an election. The city suggested that the court order environmental review of the 29 parcels prior to city approval of any alterations, or that the court suspend Measure I-97-1 until the city completes an environmental analysis. However, the court said studying the 29 parcels after the election would be an improper post-hoc review. No authority exists for suspending Measure I-97-1, the court added. "We point out that the invalidation of the election in this case is not a matter of discretion of the trial court or of this court; such invalidation results by operation of law (CEQA)," Lillie wrote. The Case: Friends of Sierra Madre v. City of Sierra Madre, No. B129139, 99 C.D.O.S. 9639, filed December 8, 1999. The Lawyers: For Friends: Susan Brandt-Hawley, Brandt-Hawley & Zoia, (707) 938-3908. For Sierra Madre: Michael Zischke, Landels, Ripley & Diamond, (415) 512-8700.

About 1,000 industrial and warehouse jobs would return to downtown Los Angeles if a project proposed next to Chinatown moves forward. However, environmentalists and some neighborhood advocates are fighting the project because they say the area already has enough warehouses. Developer Ed Roski Jr., who recently helped bring the Staples Center to downtown, proposes building a $60 million, 950,000-square-foot warehouse and industrial center called River Station. Roski's firm, Majestic Realty, wants to build the 32-acre warehouse and industrial center on a polluted former rail yard known locally as the Cornfield. Majestic is counting on a $1.2 million economic development incentive grant from the city, which would help pay for soil and groundwater cleanup. The grant is a pass-through of federal Housing and Urban Development funds earmarked for brownfields reuse. Majestic also has applied for a $10.5 million brownfields loan from HUD. However, Friends of the Los Angeles River (FOLAR), the Environmental Defense Fund and some Chinatown groups are lobbying against the brownfields funding. They argue that Chinatown has more pressing needs than new industry. "You basically have a community, the Chinatown community, that has no park and no school, and you have a proposal on that 32 acres of land that could provide those amenities," said Jan Chatten-Brown, attorney for FOLAR. "It doesn't seem like good planning and it seems like a disparate impact on a community of color." City leaders, however, want the property to become an economic asset. The Cornfield (so named because kernels used to blow in from the nearby Capitol Milling plant and sprout on the site) lies within empowerment and enterprise zones, meaning businesses that locate there would be eligible for tax breaks. The Cornfield is zoned for industry, and the adopted Central City North Community Plan also calls for industrial use, said Hadar Plafkin, a city planner. City officials and Majestic representatives note that the area near the Cornfield has remained economically depressed even as nearby areas flourished during the late 1990s. This is partly because distribution and supply companies have moved from downtown to East Los Angeles and the suburbs, said John Hunter, Majestic vice president. "The city of Los Angeles needs manufacturing jobs, particularly in this area," he said. The Majestic proposal would clean up a contaminated rail yard that has become a dumping site, create jobs and provide tax revenue to the city, Hunter argued. But attorneys for project opponents appear to be laying the groundwork for future lawsuits. They contend that the proposed mitigated negative declaration does not adequately address a number of issues and that an environmental impact report should be prepared. State Senator Richard Polanco (D-Los Angeles) also has requested an EIR that provides "a complete and thorough assessment of the presence of hazardous materials" and addresses potential aesthetic impacts on surrounding communities. Furthermore, the National Park Service has asked for an EIR because of the project could physically block the planned Juan Bautista de Anza National Historic Trail and harm 18th Century historic sites. But Plafkin, the city planner, said background material for the mitigated negative declaration is already the size of a small EIR and further study is unnecessary. Majestic's Hunter agreed. "An EIR would reveal no new information regarding the property, it would only slow us down," Hunter said. Opponents also are working to incorporate Title VI of the federal Civil Rights Act into the planning process for the first time in Los Angeles. Robert Garcia, senior attorney for the Environmental Defense Fund, said that Title VI of the Civil Rights Act mandates that the city's land-use planning processes and HUD's method of awarding money must consider a development's impact on people of color. Whether or not the city allows Majestic to build River Station, the trend of redeveloping old industrial sites in the Los Angeles area appears to be strong. "You are seeing a lot of old, single-use industrial sites being cleaned up and reused as new industrial sites," said Larry Kosmont, a Southern California real estate consultant. "They are well-located in urban areas where large pieces of property are difficult to put together." Elsewhere in Los Angeles, a closed General Motors factory is being redeveloped as a 100-acre industrial project, and a former Hughes missile plant is returning as a 70-acre technology and business park, Kosmont said. More projects are on the way because the demand for industrial space is strong and vacancy rates remain low, he said. Plus, companies are looking for more modern facilities than are commonly found in industrial centers in cities such as Los Angeles, Vernon and Commerce, he said. However, because the old industrial sites typically are contaminated and have serious traffic constraints posed by deteriorating, narrow streets, government subsidies are necessary to make reuse possible, Kosmont said. In many instances, environmental groups are happy to see federal brownfields funding clean up industrial pollution. But, with regard to the Cornfield, green organizations argue that the federal government should not subsidize Roski's industrial project. Instead, FOLAR has advanced a plan that calls for schools, parks and neighborhood commercial uses. The city's zoning administrator is likely to make a decision on the level of environmental review and the project's merits early in 2000. The only entitlement Majestic has requested is a variance to eliminate 15-foot setbacks, said Plafkin.

An appellate court has thrown out an environmental impact report for a 17,000-acre-foot water project in El Dorado County because the EIR was predicated on an unadopted, draft general plan. In the same far-reaching opinion, the Third District Court of Appeal ruled that the purchase of three reservoirs by an irrigation district was not categorically exempt from the California Environmental Quality Act because the district planned to provide the water for consumption, which would have been a new use. The court also ruled that the Federal Powers Act did not preempt state law requiring a study of the reservoir purchase. The court provided a broad reading to an exception, known as Section 27, which gives states authority over important rivers used for consumptive purposes. "It's the first such court ruling in the nation," said Stephan Volker, the environmental attorney who argued the case. The court also ruled that the EIR did not adequately discuss baseline conditions, that purchase of the reservoirs was not categorically exempt from CEQA review, and that an irrigation district improperly filed its notice of exemption. The El Dorado County Water Agency and the El Dorado Irrigation District have asked the State Supreme Court to review the case. "There is no law on the books anywhere that says you have to have a general plan in place before you can apply for water rights," Irrigation District attorney Noble Sprunger said after filing a petition with the Supreme Court in mid December. "What the general plan exactly says is of no moment for water agencies," which are independent of the county government, he said. The Third District decided the case in early November but did not publish the ruling. After both sides made strong arguments, the court published the opinion in early December. The decision to publish, which makes the case a statewide precedent, is one reason the Water Agency and Irrigation District have sought State Supreme Court review, Sprunger added. The case stemmed from a plan of the Water Agency and the Irrigation District. They proposed using water from three high Sierra reservoirs to serve a growing population in the western part of the county. They also pursued purchase of the reservoirs from Pacific Gas & Electric. In September 1992, the two water entities prepared a draft EIR that said the water program was intended to meet the needs of growth anticipated in the county general plan update, which was in draft form. The draft EIR concluded that the proposal to divert water for consumptive uses would not alter the way PG&E operated Caples Lake, Silver Lake and Lake Aloha, jointly known as Project 184. The Department of Fish & Game and the League to Save Sierra Lakes (which included environmental groups, homeowners associations and Alpine County) commented that the draft EIR did not address PG&E's historical operation of the lakes, thus limiting the ability to measure impacts. The League also commented that the general plan process was incomplete and that the EIR did not adequately discuss the relationship between growth and water. But the water entities did not change the draft EIR before adopting it in March of 1993. Later that same year, the State Water Resources Control Board rejected the water entities' water rights application for the 17,000 acre feet from the three reservoirs. The water entities submitted a new application, at the same time the Irrigation District began negotiations with PG&E to purchase Project 184. The League to Save Sierra Lakes, DFG and Amador County all filed lawsuits, which were consolidated into one writ petition. (Amador County later settled its claims.) Retired Appellate Justice Winslow Christian heard the case and ruled against the Water Agency and Irrigation District, which then appealed. The water entities argued that the CEQA claims were moot because El Dorado County had adopted a new general plan in 1996, and the Water Resources Control Board approved the water rights application with a number of reservoir operating conditions. However, the appellate court pointed out that a Sacramento County Superior Court later determined the general plan was inadequate in many respects and must be rewritten. (The Superior Court also struck down a revised general plan in 1999. See CP&DR Local Watch, March 1999.) Furthermore, the Water Resources Control Board had reconsidered the water rights application. But the appellate court made clear that environmentalists would still have had a legitimate claim even if the county had adopted a valid general plan in 1996. "In this case, approving a water program before enacting a general plan places the proverbial cart before the horse," Justice Harry Hull wrote for the unanimous three-judge panel. "By proceeding without the benefit of the general plan in place, and by developing projects predicated on needs described in an unadopted plan, the CEQA process is stood on its head," Hull continued. "Instead of proceeding from a more general project to more specific ones, as is commonplace in tiering (see Guidelines §15152), the exact opposite occurs: a specific water project drives the general plan process. The issues become circular: water supply projects are adopted to meet growth plans outlined in a draft general plan, and the general plan is then adopted because an adequate water supply exists for the outlined development plans." But Sprunger, the Irrigation District attorney, said the court's reasoning forces the Board of Supervisors to adopt a general plan that lacks an adequate water supply. Water agencies must take steps to procure water years in advance of its actual need because the water rights process is lengthy, he said. "What the court did was hamstring the planning process by hamstringing the water supply process," he said. The court also ruled that the EIR's description of baseline environmental conditions was inadequate. The water entities and those protesting the water program differed on what information the EIR contained, but the court said the EIR should be easier to understand in any case. "It may well be that by cobbling together information included in and appended to the EIR, a reader might be able to calculate historic flow releases and gain a better understanding of how PG&E had operated the lakes in the past and how defendants intended to operate them in the future," Hull wrote. "But such an effort should not be necessary. An adequate EIR requires more than raw data; it requires also an analysis that will provide decision makers with sufficient information to make intelligent decisions." As for the Project 184 purchase, the Irrigation District argued that the Federal Powers Act preempted CEQA. But the court said §821 of the Federal Powers Act (commonly called Section 27) lets states control appropriation or distribution of water used for irrigation or municipal uses. The Project 184 purchase falls within this exception because the ownership change also entailed a "shift from a single-purpose hydroelectric project to multipurpose use that also permits consumptive use of water," the court ruled. The court also said CEQA review would not interfere with federal energy licensing procedures. Environmental attorney Volker said this was a significant widening of Section 27, which courts "have given lip service to" in the past. The court further rejected the Irrigation District's argument that the lawsuit over the CEQA exemption was filed too late. Normally such challenges must be submitted within 35 days of the filing of the notice of exemption. However the court ruled that the deadline to challenge the exemption was 180 days because the notice of exemption was defective. The Irrigation District argued that it approved the project — the purchase of Project 184 — on December 12, 1994, when the Board of Directors authorized the district manager and counsel to begin negotiations with PG&E. The district filed the notice of exemption in April 1995. However, the court ruled that the December 1994 resolution did not "constitute project approval as nothing in this resolution commits the district to purchasing Project 184." Instead, the court determined, project approval occurred in September of 1995 when the district entered into an asset sale agreement. The plaintiffs filed their lawsuit the following month, and amended it in December of 1995 to name PG&E, well within the 180-day deadline. The irrigation district also argued that the reservoir acquisition could bypass CEQA based on the "existing facilities" exemption or the "ongoing project" exemption. But the court ruled, "A project that shifts from nonconsumptive to consumptive use is not a negligible expansion of current use. It is a major change in focus, and thus does not fall within the ‘existing facilities' categorical exemption." For the same reasons, the court rejected the "ongoing project" argument. The Case: County of Amador v. El Dorado County Water Agency, No. C027948, filed November 3, 1999, certified for publication December 3, 1999. The Lawyers: For El Dorado Irrigation District: Noble Sprunger, (530) 642-4155. For El Dorado County Water Agency, James Moose, Remy, Thomas & Moose, (916) 443-2745. For Department of Fish & Game, Charles Getz IV, assistant attorney general, (415) 356-6348. For League to Save Sierra Lakes, Stephan Volker, Brecher & Volker, (510) 496-0600.

In its own way, Grand Avenue in downtown Los Angeles is as strange and fantastical as the imaginary towns in Italo Calvino's Invisible Cities. One of the Italian novelist's inventions is Armilla, a city that consists of nothing but a forest of water pipes, where beautiful women shower. Another is Morlana, which has a gorgeous fa�ade of alabaster gates and coral columns, which hides a pile of trash. Yet another city is a sphere made up of twisted roads designed to prevent a woman from escaping. Unlike Calvino's cities, Grand Avenue is real, not imaginary. Even so, the description of this strange street could easily fit into the Calvino catalogue of fantasy cities without being noticed. Consider the following: Bunker Hill had been the affluent part of downtown in the late 19th Century, and later became a ramshackle collection of charming, if dilapidated, houses. The city bulldozed all the houses on the hill, which then stood bare for more than 10 years while city fathers argued about what to do build next. Eventually, they decided to build office towers, and the hill became choked in a superstructure of steel. In the course of building this city-in-the-sky, it became necessary to haul away all the dirt. Nothing was left of the hill, except the street, which by now had become an absurd bridge in the air. Beneath the bridge was another street, with the same name, where unglamorous necessities like loading docks and parking entrances were hidden. Absurd or not, Grand Avenue is one of the most important streets downtown, and is quickly growing more important. The street is the home of the most important Los Angeles County buildings, the Los Angeles Music Center (the city's Yorty-era answer to Lincoln Center), the Museum of Contemporary Art and the new Colburn School of Music. Those buildings are soon to be joined by the new Cathedral of Los Angeles and the long-deferred Disney Concert Hall, the future home of the Los Angeles Philharmonic and a likely successor to City Hall as the postcard image of Los Angeles. What is odd is that Grand Avenue � where some of the city's largest and most expensive buildings currently are rising �functions poorly as a street. Like Fifth Avenue in New York, Grand Avenue is a street of very large buildings that do not seem to form a continuity among each other. Further adding to the sense of discontinuity, a portion of the street is a bridge, which creates an unwelcome gap in the procession of buildings. Yet another issue is this street-in-the-air's poor connection to the rest of downtown. These problems are not minor ones on a street that both Mayor Richard Riordan and the city's Community Redevelopment Agency want to make into the city's official "arts corridor." One part of the solution is a design by local architect and urban planner Doug Suisman, who was commissioned by the Community Redevelopment Agency. Borrowing an idea from Barcelona, Suisman proposes a wide, green median that runs down much of Grand Avenue. This median acts as more than mere landscaping: Instead, this "ramblas" is a social space, inhabited by series of small cafes, cart vendors and news stands. Although the design concept is foreign to Los Angeles, it is a simple, affordable and convincing solution to several vexing problems on Grand Avenue. The ramblas would provide badly needed social space that can serve as a kind of receptacle for people who are milling around before a concert, or who have just heard Mass at the cathedral and who want to get a cup of coffee before taking a gander at the latest head-scratching exhibit at the Los Angeles Museum of Contemporary Art. Almost as important, the ramblas could also provide Grand Avenue with the continuity currently lacking on the street by providing the unifying, horizontal condition that would otherwise be impossible to provide. Adequate space exists in the city's right of way to create the ramblas without impacting traffic lanes, although wide sidewalks would be precluded. In short, the ramblas promises to make Grand Avenue into a wonderful, socially active street, rather than a parade of mutually unacknowledging large buildings that line the boulevard like a sullen set of giant chess pieces. With such an inspired design choice, what could go wrong? Politics, of course. Grand Avenue may be officially under the purview of the redevelopment agency, but the CRA does not have as much clout as it formerly did. (A former councilman successfully sued the agency to prevent the lifting of the agency's debt cap; the suit effectively hobbled the agency's ability to underwrite large projects, and, in turn, to offer incentives to developers who would otherwise be deaf to the agency's urban-design agendas. See CP&DR Economic Development, March 1999.) Both the mayor and the cardinal are reportedly enthusiastic about the ramblas, but the Music Center and Disney Hall have been silent. If they actively oppose the landscape project, the redevelopment agency may or may not be able to push the project through over their objections. Worse, both the Music Center and Disney Hall are projects that are under the jurisdiction of Los Angeles County, which often quarrels with the City of Los Angeles about the county's projects in the downtown area. Frank Gehry, the architect of Disney Hall, has said that he wants wider sidewalks in front of the concert venue, which could narrow the street, taking away some of the width needed to accommodate the ramblas. In the absence of a master plan for the arts corridor, individual institutions seem to be vying for primacy and control of the street. Can it be true that Grand Avenue's institutions are unaware that a vibrant street would benefit them? Los Angeles has shown that it is willing to campaign and raise tens of millions of dollars for the Disney Hall, whose price tag has reached $274 million. But is the city willing to campaign with comparable ardor for a project has far fewer capital needs � about $5 million to $6 million � yet would contribute nearly as much to downtown? Of all the absurdities that make up Grand Avenue, the greatest would be that the street's powerful cultural institutions would decide against making the street into a sensible place. Arts institutions that ostensibly seek to enhance our lives should walk their talk on Grand Avenue.

The City of Montclair's ordinance controlling rents in mobile home parks is constitutional, the Fourth District Court of Appeal has ruled. The court rejected mobile home park owners' argument that the ordinance was a regulatory taking without compensation. Citing the California Supreme Court's decision in Santa Monica Beach, Ltd. v. Superior Court, (1999) 19 Cal.4th 952, the appellate court ruled that "a rent control ordinance is a regulatory taking if it is an arbitrary regulation of property rights." (See CP&DR Legal Digest, February 1999.) In Montclair, the City Council adopted its ordinance to protect mobile home owners' equity in their homes, and to protect prospective park tenants from excessive rent increases. These are "legitimate government interests," the court concluded. In continuing California courts' generous attitude toward rent control ordinances, the unanimous three-judge appellate panel dealt extensively with the proper way to test the constitutionality of an ordinance. The court ruled that important takings cases upholding a landowner's development rights are not applicable to rent control controversies. The Montclair City Council adopted the ordinance in question on June 20, 1998. The ordinance amended a previous rent control measure that allowed park owners to raise rents as much as they wished when a mobile home owner sold the unit. Plus, a study commissioned by the city found that park owners were skirting the prior ordinance by requiring prospective tenants to sign long-term leases that were exempt from the rental control ordinance. The prospect of having to pay higher rents discouraged some potential mobile home buyers. The study said that these limitations on the ability to sell mobile homes resulted in more homes being abandoned, which placed them in the hands of park owners. Thus, the city adopted new regulations that precluded park owners from requiring tenants to sign long-term leases, and limiting rent increases upon sale of a unit from 3% to 8% annually, depending upon the Consumer Price Index. The ordinance also allowed park owners to apply for higher rents based on operating costs, taxes and capital improvements. Park owners also could file an application for higher rents with the city's Park Mediation Committee, whose decisions were appealable to the City Council. On August 18, 1998, park owners filed a lawsuit complaining that the ordinance was unconstitutional on its face. Park owners argued that enactment of the ordinance amounted to inverse condemnation. Park owners did not raise issues of federal constitutionality, instead leaving those for a federal court to decide. Riverside County Superior Court Judge Peter Norell sustained the city's demurrer, and the park owners appealed. Park owners argued that the court should follow the decision of the Ninth U.S. Circuit Court of Appeals in Richardson v. City and County of Honolulu, (9th Cir. 1997) 124 F.3d 1150. In that case, the Ninth Circuit ruled that Honolulu's rent control ordinance was a regulatory taking because, as written, the ordinance did not advance its legitimate stated goal of creating more affordable housing. But the unanimous Fourth District, Division Two, panel said Richardson was not applicable because the Ninth Circuit used the Agins-Nollan test in striking down the Honolulu law. Under the Agins-Nollan test, an ordinance is unconstitutional if it fails to substantially advance a legitimate government interest and it deprives a property owner of all economically viable uses of his property. Agins v. Tiburon, (1980) 447 U.S. 255; Nollan v. California Coastal Commision, (1987) 483 U.S. 825. However, the precedent from these landmark cases does not extend to rent control plans, the court said. In City of Monterey v. Del Monte Dunes at Monterey, (1999) 119 S.Ct. 1624, the U.S. Supreme Court "acknowledged that it had never extended the Agins-Nollan test beyond cases involving regulations requiring dedication of private property for public use as a condition of the issuance of a land development permit," Presiding Justice Art McKinster wrote for the three-judge appellate panel. (See CP&DR Legal Digest, June 1999.) Furthermore, the state Supreme Court in Santa Monica Beach ruled that the Agins-Nollan test does not apply to general rent control laws. "Instead, the court adopted a more deferential standard of review, reasoning that general rent control laws are ‘essentially legislative determinations that do not require any physical conveyance of property,'" McKinster wrote. The same reasoning that applies to general rent control laws — the Santa Monica law that the court upheld was aimed at apartments — should apply to mobile home rent control, the appellate court ruled. "The proper inquiry in determining whether a rent control scheme applicable to mobile home parks is a regulatory taking under the California Constitution is whether such a scheme is an arbitrary regulation of landowner's property rights," McKinster wrote. With little discussion, the court held that protecting current mobile home owners' equity and protecting prospective park tenants from excessive rents are legitimate government interests. Thus, the Montclair ordinance is not an arbitrary regulation, the court concluded. The Case: Montclair Parkowners Association v. City of Montclair, No. E024137, 99 C.D.O.S. 9453, 1999 Daily Journal D.A.R. 12197, filed December 2, 1999. The Lawyers: For Parkowners: Robert Coldren, Hart, King & Coldren, (714) 432-8700. For Montclair: Diane E. Robbins, Robbins & Holdaway, (909) 627-1503.

Five California waterways are in the running for federal funding in a new program to help restore and protect their environmental features while building protection against floods. A federal water bill signed by President Clinton last August listed the waterways. The program is another sign of a dramatic shift in how the U.S. Army Corps of Engineers approaches flood control. Instead of trying to control water flows and protect every structure from harm's way, under the new Challenge 21 (also called Section 212) program, the Corps will remove people and structures from places where there has been repeated flooding. Rather than adding more concrete, dams and levees, flood control efforts will incorporate natural features, provide more open space along waterways, and encourage habitat and wetlands restoration. The bill for the five-year demonstration project provided that "studies and projects shall emphasize, to the maximum extent practicable and appropriate, nonstructural approaches to preventing or reducing flood damages." "It represents a new way of thinking about the flood plain," said Michael Davis, Deputy Assistant Secretary of the Army for public works. "While structural approaches have worked well in the past, and will continue in some cases to work well in the future, we want to make sure that nonstructural options are considered fully." The Challenge 21 program should, Davis said, "demonstrate that nonstructural approaches and ecosystem restoration ... is a good thing and will reduce flooding and improve our environment." The bill authorized $200 million over five years, with the first allocations expected after October 2000. Local and state governments must pay up to 35 percent of the cost of any environmental restoration or nonstructural flood control project, and the federal government picks up the rest of the tab. The five California waterways named as priority areas are: o The Coachella Valley in Riverside County. o Murrieta Creek in Riverside County. o Napa River watershed, in Yountville, St. Helena, Calistoga, and American Canyon. o Santa Clara basin, including the Upper Guadelupe River and its tributaries, San Francisquito Creek, which runs through Palo Alto, Menlo Park and East Palo Alto, and Upper Penitencia Creek. o Los Angeles and San Gabriel Rivers. California has the largest number of priority areas in the legislation, followed by Pennsylvania with three waterways. Davis said he expects that ultimately 10 to 15 projects will be funded under Challenge 21, even though the bill listed 23 priority watersheds. And with a cap of $30 million per project, it is unlikely that the concrete-lined Los Angeles River will be torn up. More likely, the money might fund a small wetlands restoration along the river, he said. Guidelines for projects should be released in several months, and Davis expects communities outside the priority areas might also to apply for funds. "Listing projects simply means that when money is appropriated for Challenge 21, these are probably the projects that will be considered first," said Peter Moreno, water resources project assistant with the National Wildlife Federation in Washington, D.C. "Authorization of Challenge 21 does not guarantee that these projects will be funded. That is up to the appropriations process." The Clinton administration had requested $325 million for the program. "Overall," Moreno said, "Challenge 21 was a major accomplishment, even though the funding levels were below the administration's request. The Corps' ability to carry out voluntary property buyouts and other nonstructural alternatives will help to direct floodplain management in this country toward more sustainable, environmentally friendly ends." "I think it's great," said Ron Stork, senior policy advocate for Friends of the River in Sacramento. While applauding the new program, Stork added, "the demand far exceeds the resources." The program adopted by Congress incorporates many of the features of a $200 million project already underway in Napa Valley to restore the Napa River. Most of that money is designated for the city of Napa, which has experienced regular flooding from winter storms during the last 10 years. (See CP&DR Environment Watch, May 1998.) Up to 675 acres of marshes and wetlands are being restored or preserved, trees and bushes are being planted and a recreational trail is planned. A total of $6 million in local funding is being provided through a voter-approved sales tax. The Napa program was developed through negotiations between local officials and the Army Corps of Engineers and marked a shift from the Corps' traditional role of dam-builder. With funding from the Challenge 21 program, more money could be spent on river restoration and flood control outside Napa in other parts of the county, according to County Supervisor Mike Rippey. While efforts to restore the Los Angeles and San Gabriel Rivers are moving slowly, proponents see the possible money as a way to restore parts of the rivers to a more natural state. A meeting to discuss the new program with the head of the Army Corps of Engineers and local environmentalists was planned for mid-December, said Melanie Winter, executive director of Friends of the Los Angeles River. Additional money may be provided to river restoration projects in Los Angeles County if separate parks and water bonds pass during March's state primary, she said. Money could be used, among other ways, to remove industrial warehouses lining river banks to create more open space, or to add retention basins to save water and reduce the amount of stormwater in the river beds. The new approach by the Army Corps of Engineers is not the only change in flood control efforts at the federal level. The Federal Emergency Management Agency has taken a harder line in recent years toward rebuilding in areas recovering from floods. The House of Representatives is considering a bill, co-sponsored by Representative Doug Bereuter, (R-Nebraska) and Rep. Earl Blumenauer (D-Oregon), that would restrict property owners from retaining subsidized federal flood insurance if their properties have been damaged more than once. The bill, H.R. 2728, has the official title of "Two floods and you are out of the taxpayer's pocket act of 1999." Another similar bill, H.R. 1297, the Repetitive Flood Loss Reduction Act, sponsored by Rep. Ken Bentsen, (D-Texas) has also been introduced. Davis said the Corps intends to work with other federal agencies such as FEMA, EPA and the U.S. Department of Agriculture as it plans the projects. Contacts: Michael Davis, Deputy Assistant Secretary of the Army for Civil Works, (703) 697-3366. Ron Stork, Friends of the River (916) 442-3155. Peter Moreno, National Wildlife Federation (202) 797-6697. Mike Rippey, Supervisor, Napa County (707) 253-4386. Melanie Winter, Executive Director, Friends of the LA River, (323) 223-0585.

With complaints rising in Sonoma County regarding the expansion of vineyards, county officials have adopted regulations for grape planting. However, at least some environmentalists and homeowners believe the restrictions are inadequate, and the protests show no sign of abating. Within the last year or so, the amount of Sonoma County property planted as vineyards has surpassed the acreage in the county's nine incorporated cities. Environmentalists and homeowners complain that these new vineyards erode topsoil, deplete groundwater supplies, contaminate the environment with pesticides and ruin wildlife habitat. Grape growers say these concerns are exaggerated and contend that there is no reason to worry about what some have termed "runaway vineyard development." The Sonoma County Board of Supervisors responded to the controversy by approving an ordinance, scheduled to take effect this year, that prohibits vineyard planting on slopes of at least 50%, calls for erosion control measures on slopes of at least 15% and mandates a 50-foot setback from riparian corridors. The new rules have made grape growers happier than environmentalists, and a study by the University of California Cooperative Extension in Hopland demonstrated why. "A very, very small amount of previously developed vineyards and lands most suitable for future planting would fall under this ordinance," said Adina Merenlender, a UC Cooperative Extension specialist. "The bottom line is that farmers did a very good job of protecting themselves." The Board of Supervisors makes no apologies for supporting growers. Although the wine industry employs only about 8,900 people countywide, or about 4% of the work force, wine has become the county's signature. Even Supervisor Mike Reilly, the supervisor most sympathetic to environmental causes, was quoted in the Santa Rosa Press Democrat as saying, "Ag in whatever form is vastly preferable to subdivision development." Fifteen years ago, subdivisions were the big worry in Sonoma County, where the traditional apple, prune and dairy industries were declining. However, grape growing was taking off. From 1985 to 1999, the amount of land planted with vineyards increased from about 30,000 acres to 52,000 acres. This growth occurred because of higher sales of more expensive wines (Sonoma County grapes are used for premium varietals) and because the neighboring Napa Valley has almost no land remaining for additional vineyards. Most new Sonoma County vineyards replaced other agricultural uses, namely orchards and pasture. However, vineyards have supplanted about 2,000 acres of dense oak woodland since 1990, according to Merenlender. This is worrisome because planting even small vineyards in an area that supported oaks is fragmenting habitat and forcing species to survive in smaller areas, she said. A four-month-old, Occidental-based group called Town Hall Coalition is leading the vineyard opposition. The organization attracted crowds of at least 200 people to each of three forums it has conducted. "This summer, everything changed," said Lynn Hamilton, a Town Hall Coalition leader and former Sebastapol city councilwoman. Vineyards had been seen as valuable assets, she said, but homeowners and real estate agents have begun complaining about wells running dry, pesticide spraying, and the loss of a diverse ecosystem. "You just can't believe the panic in all of these little communities after we nurtured this (agriculture) for so many years," Hamilton said. "This is Gallo, this is Kendall-Jackson. This is corporate, industrial vineyards. … It's slash and burn agriculture." Town Hall Coalition calls for regulating groundwater, preventing new vineyards on slopes of greater than 30%, limiting lot coverage to 75%, mandating erosion control systems that can handle 100-year storms, building wildlife corridors and animal-friendly fences, and implementing stronger state pesticide regulation. Grape growers say opponents paint an unfair picture and Town Hall Coalition proposals are unnecessary. Only 5% of Sonoma County is planted in grapes, and 80% of vineyards are smaller than 100 acres apiece, according to Nick Frey, executive director of the Sonoma County Grape Growers Association. Also, grapes require less water than apples, vegetable crops or houses. Growers also argue that the pesticide threat is overstated and assert that 75% of pesticides used are sulfur, which can be applied even to certified organic produce. State inspectors have found no instances of groundwater contamination linked to legal pesticide use in the last 10 years, growers say. Still, grape growers must contend with negative perceptions in Sonoma County and elsewhere for the first time. A recent poll of 700 Sonoma County voters by Richard Herzog Consulting of Bodega Bay found the industry enjoys a very strong reputation. Still, about half of respondents supported new regulation of vineyard expansion. The public has rallied for a variety of reasons. Kendall-Jackson's cutting of 800 oak trees when the Santa Rosa company converted a 1,400-acre cattle ranch to a vineyard in Santa Barbara County two years ago created a storm of protest. The Kendall-Jackson activity led to a county initiative — which voters defeated in 1998 — that would have required a permit to cut an oak tree. At about the same time, Gallo began clearing forested hillsides in Sonoma County's Russian River Valley, stirring public discontent. Last year, some San Luis Obispo County environmentalists and ranchers made strange bedfellows in calling for a halt to the conversion of ranches to vineyards. The county does not regulate vineyard planting. Instead, the construction of large wineries on agricultural land is the bigger issue, said Mark Hutchinson, environmental specialist at the San Luis Obispo County Planning Department. Since 1996, the county has approved 34 new wineries and nine expansions, ranging from farmhouse conversions to a 700,000-square-foot facility. The industry is under a microscope now, more so in Sonoma County than anywhere, conceded Barry Bedwell, president of the Fresno-based Allied Grape Growers. "The wine-grape industry is aware and is attempting to be sensitive to these issues that are being raised," Bedwell said. Grape growers need to bridge the gap with environmentalists and the "urban sector," he said. Sonoma and Napa counties are farthest along in regulating vineyard activity, although Santa Barbara County now uses a grading ordinance to regulate some planting. Still, the rules are limited. Any efforts to regulate the industry are a concern, Bedwell said. Whether grape growing will continue to expand in Sonoma County is debatable. California has about 507,000 acres of vineyards, nearly one-quarter of which were planted during the last five years, Bedwell reported. Growers suggest much of the Sonoma County land best-suited for vineyards has already been planted. Using a geographic information system, the UC extension determined that about 158,000 additional acres are at least somewhat suitable for new vineyards. However, UC's Merenlender said some of that acreage is marginal land where planting is unlikely, and she emphasized the figure is not a prediction. Contacts: Lynn Hamilton, Town Hall Coalition, (707) 874-9110. Barry Bedwell, Allied Grape Growers, (559) 276-7021 Adina Merenlender, UC Cooperative Extension, (707) 744-1270.

California's Central Valley, the most important part of the state's giant agriculture industry, will have three times as many residents in 2040 as it does now, according to demographers. The conflict between population growth and farming is driving many planning efforts, some of which are including urban growth boundaries as a means of protecting agriculture. The growth-boundary concept is not new in the Central Valley. Tulare County and its largest cities have had urban growth boundaries for 20 years, and Yolo, Sutter and Butte counties have perimeter control lines intended to protect farmland. Sacramento, Fresno, Merced and Kings counties have expansion lines of sorts, although they seek to direct urban growth, not contain it. Now, the idea is spreading: • In Stanislaus County, ballot measures creating urban growth lines in the county and in nine cities appear headed for the November election. • In Fresno, a coalition of farm, building and business interests is urging city leaders to adopt the Tulare model as part of the Fresno general plan. • In Bakersfield, an urban limit is likely to be considered during the city's general plan update. • In Redding, a new general plan is likely to include limit lines to encourage infill. "I think you will hear more about that in the Central Valley," said Erik Vink, California policy director for the American Farmland Trust. "We're always picking up on these trends from elsewhere. The Bay Area has kind of been the laboratory for this type of land-use idea." Contra Costa County has had a voter-approved urban limit line since 1990, although slow-growth advocates would like to tighten it. More than two years ago, Stanislaus County growth-control advocates began working on urban limit line initiatives for the county and its nine cities. The proposed Future Options on Development (FOOD) initiatives would have urban limit lines coincide with existing general plan boundaries for the cities and with community plan boundaries for about two dozen unincorporated areas, explained Denny Jackman, president of the group called Growth Orderly, Affordable, Livable (GOAL). The intent is to stabilize the farmland base and protect the environment and open space. The boundaries would establish "a budget on land" that could be developed, Jackman said. "Instead of looking inside out, they would have to stand at the boundary and look within." Initiative backers are strongly considering language that would allow changes in the urban limit lines only by a vote of the electorate, he added. Organizers of GOAL have presented the Stanislaus County Board of Supervisors and most city councils with the proposed initiative language in hopes that the elected officials will place the measures on local ballots. Thus far, no elected body has agreed to put the FOOD initiatives to a vote. But Jackman is confident GOAL can acquire enough signatures to qualify the initiatives for the November 2000 election. Many people equate problems such as long commutes and crime with "the runaway kind of growth we have going on," he said. In Fresno, urban growth boundaries received a boost from the Growth Alternatives Alliance, a diverse group that includes the American Farmland Trust, the California Farm Bureau, the Building Industry Association of San Joaquin Valley, and the Fresno Business Council. The Alliance, which last year produced the Landscape of Choice report that called for moderate growth reforms, has recommended establishing an urban growth boundary for Fresno. The boundary would be expandable as the city hits certain population and buildout thresholds. The first boundary, at about the existing sphere of influence, could accommodate up to 650,000 people, said Greg Kirkpatrick, of the AFT's Fresno office. The ascending boundaries would accommodate another 150,000 people each, up to 1.1 million. "It's a testament to how unified our consensus is as to where growth should be directed in Fresno, and that is to the northeast and the foothills," Kirkpatrick said. "Our recommendations include firm growth boundaries that preclude growth into prime agricultural areas in southeast and southwest Fresno." The idea is young in Fresno, but it could receive a favorable reception at what has been a pro-growth City Council. In December, Mayor Jim Patterson advocated keeping the next 20 years of growth within the current sphere of influence because, he said, Fresno (population 415,000) could grow to 700,000 within that sphere. While farming advocates were pleased with Patterson's suggestion, even the AFT's Kirkpatrick questioned Patterson's assumptions because so little market demand exists for infill projects, especially in the depressed downtown. The Growth Alternatives Alliance proposal is based on existing policy in Tulare County, where the county and its cities have had growth boundaries for two decades. When certain thresholds are met, the elected bodies may expand the boundaries to the next pre-established limit, said Steve Brandt, Visalia senior planner. Visalia, the county's largest city, has three boundaries that roughly correspond to projections for 2000, 2010 and 2020, he said. That city has reached the first population threshold of 98,700, but not the buildout minimum of 70% for residential land and 80% for commercial property, he said. Visalia leaders advocate concentric growth around the core of the city, Brandt said. The urban growth boundary protects agricultural land for as long as possible. The boundary, which is incorporated in the general plan land-use element, also serves as a basis for other documents, such as the sewer master plan, Brandt said. The growth boundaries work well in part because of inter-governmental cooperation, Brandt added. The county has designated land with 20-acre minimum lot sizes around Visalia. "Luckily for us, Tulare County is very big about preserving agricultural land," he said. Growth Alternatives Alliance members recognize that cooperation is important because a neighboring jurisdiction with open arms for developers would ruin the whole point of a growth boundary. The Alliance recently helped organize the first meeting of the Fresno County Board of Supervisors, the Fresno City Council and the Clovis City Council. However, the meeting rapidly fell apart as officials got bogged down in a revenue-sharing debate. The lack of regional cooperation has also been an issue in Kern County, where the county and the City of Bakersfield at times have competed to entice developers. Still, the advantages and disadvantages of growth boundaries are likely to be discussed during Bakersfield's general plan update, which is getting started, said Bakersfield Development Services Director Jack Hardesty. Such boundaries fell out of favor during the 1980s when the county had a growth line that was too easily amended. "They didn't hold the line, literally," he said. But, he added, "it will come back as a proposal from the Smart Growth Coalition, I'm sure. They are coming out as a fairly strong voice." The Coalition, which successfully lobbied for reestablishment of a planning commission in Kern County, "supports any policies that will get us to our goals," Executive Director Pauline Larwood said. The seven-year-old organization advocates infill, redevelopment, compact design, and protection of the farming, oil and defense industries. Larwood said the Coalition has urged the Planning Commission to consider Tulare County's system because "it appears to have resulted in more contiguous development." Interestingly, it might be agriculture that forces creation of some type of boundary in Kern County. Recent proposals for giant dairies southwest of Bakersfield met with strong resistance from homeowners, causing Supervisor Ken Peterson to propose designating a greenbelt around Bakersfield to separate residential and agricultural uses. At the north end of the Central Valley, in Redding, the revised general plan will probably contain "primary and secondary growth areas," according to Senior Planner Kent Manual. The primary growth area will roughly correspond to the city limits of Redding (population 79,000), which already cover 59 square miles. Large tracts of land for residential and commercial development remain available. Plus, there is some consensus for slowing the spread of ranchettes on the city's east and northwest sides because those three- to ten-acre spreads use land inefficiently and preclude future planning options, he said. Whether growth boundaries will be the tool of choice or not, it is clear that experts and, to a lesser extent, the general public are talking about land-use choices in the Central Valley. That is the good news, said Carol Whiteside, president of the Modesto-based Great Valley Center, because accommodating the projected trebling of population during the next 40 years and preserving agriculture will take strong planning. "There's a growing awareness of the valley. People are starting to pick up on the issues," she said. "From my point of view, we're still early enough to make some of these decisions." Contacts: Denny Jackman, Growth Orderly, Affordable Livable, (209) 526-5821. Greg Kirkpatrick, American Farmland Trust, (559) 627-3708. Pauline Larwood, Smart Growth Coalition, (661) 363-0218. Jack Hardesty, Bakersfield Development Services Department, (661) 326-3733. Carol Whiteside, Great Valley Center, (209) 522-5103. Kent Manual, Redding Planning Department, (530) 225-4029.

Construction of a 130-foot-tall cellular telephone transmission tower does not constitute inverse condemnation of a neighboring property from which residents can see the tower, the Third District Court of Appeal has ruled. In a case from Butte County, the court also ruled that the tower did not constitute a nuisance because it did not harm neighbors' use of their property. " hile we have sympathy for plaintiffs' plight, not all plights give rise to legal rights," Justice Daniel Kolkey wrote for the unanimous three-judge panel. "Since a landowner has no natural right to an unobstructed view, the size and shape of an otherwise lawful structure on one side of a boundary cannot be deemed either to damage (for purposes of inverse condemnation) or to interfere with the enjoyment (for purposes of nuisance) of that which is on the other side of the boundary." In about 1990, John and Joyce Permann leased a portion of their 2.5-acre property near Oroville to allow construction of a 110-foot transmission tower. The tower and a cargo container for a service module were placed on the site and surrounded with a chain link fence. In 1994, Cellular One sought a permit from Butte County to upgrade the facilities. County planners approved the project, which involved a new tower 20 feet taller than the existing one, a small concrete outbuilding and a new fence. The tower is 41 feet from the property line shared by the Permanns and their neighbors, Melvin and Brigitte Oliver. The corner of the outbuilding is 13 feet from the property line, and the fence is within seven feet. The Olivers filed a lawsuit against Butte County, the Permanns and three cellular telephone companies seeking damages and an order rescinding the use permit for the new tower. The Olivers alleged nine causes of action, including inverse condemnation, nuisance, fraud/intentional misrepresentation, and fraud/negligent misrepresentation. Butte County Superior Court Judge Roger Gilbert issued a summary judgement for the defendants. On appeal, the Olivers argued that the design, maintenance and operation of the tower decreased their property value, so they were entitled to damages based on inverse condemnation. But the appellate court rejected this argument for several reasons. First, the court said loss of property value in and of itself does not establish inverse condemnation. The California Constitution, article I, §19, speaks to compensation when private property is taken or damaged for public use. In this case, no public entity took or damaged the Olivers' property, the court concluded. Second, because the Permanns are private individuals without the power of eminent domain, "no cause of action for inverse condemnation could be maintained against them," the court ruled. Thirdly, the Olivers' did not prove that their property had been taken or damaged. In fact, the Olivers' testified that although they could see the tower and hear a hum when outside, their daily activities were not impacted. " he burden imposed on plaintiffs' property by the new tower and its attendant equipment does not resemble the type of perceptible intrusion, such as strong odors, overpowering noise, dust, vibration, or the loss of light, which directly and substantially burden the property so as to give rise to an inverse condemnation claim," Justice Kolkey wrote. He continued, "There is no authority for the proposition (and the parties cite none) that plaintiffs are entitled to compensation merely because a large, unattractive structure went up next door." The court also noted that the Olivers' never complained about the previous tower, which was only 20 feet shorter. As for the nuisance claim, the court ruled that "the essence of a private nuisance is its interference with the use and enjoyment of land." A neighboring property must be more than visually unpleasant to qualify as a nuisance, the court said. The Case: Melvin E. Oliver v. AT&T Wireless Services, No. C029233, 99 C.D.O.S. 9332, 1999 Daily Journal, D.A.R. 12003, filed November 29, 1999. The Lawyers: For Oliver: James McKenna, Peters, Rush, Habib & McKenna, (530) 342-3593. For AT&T: Kevin Iams, Weintraub, Genshlea & Sproul, (916) 558-6025.

Less than 10 miles north of the Cornfield, Walt Disney Co. has proposed a large "creative campus" on the grounds of the former Grand Central Air Terminal, a Glendale airport that closed in 1959. Disney's plans are sketchy, but the entertainment giant has revealed plans for four district projects on the site: a 52-acre campus to house the theme park research and development operations; a 24-acre soundstage and production facility; a 27-acre media and technology campus that would have space available for lease; and another 18 acres of development to meet company or market needs. Disney was one of the earliest tenants of the Grand Central Industrial Park, which replaced the airport shortly after it closed. About 3,000 Disney research and development employees work on the site. Disney purchased the property in 1997. The site is within Glendale's 750-acre San Fernando Corridor Redevelopment Project Area, which has not seen a great deal of activity since the city created it in 1992, said Philip Lanzafame, assistant director of development services. The project is in the environmental review process, and documents are scheduled to be released this spring. City officials also are negotiating financing packages with Disney, although Lanzafame said he could not disclose the details of those talks. Contacts: John Hunter, Majestic Realty, (562) 692-9581. Hadar Plafkin, Los Angeles Planning Department, (213) 580-5554. Jan Chatten-Brown, Chatten Brown & Associates, (310) 474-7793. Larry Kosmont, Kosmont & Associates, (213) 623-8484. Philip Lanzafame, Glendale Development Services Department, (818) 548-2005.

As a booming economy continues to drive up housing prices, California's top officials are placing a higher priority on housing issues in the year 2000. But with Democrats firmly in charge in Sacramento, the state's efforts appear likely to focus on providing more public assistance for housing, rather than pushing for a dramatic reform on policy issues such as the housing element law. Gov. Gray Davis appears ready to give higher priority to housing issues in his second year in office than he did in his first. Business, Housing, and Transportation Secretary Maria Contreras-Sweet stated last fall that, with water and parks bonds already placed on the March ballot, the administration would focus this year on putting housing and transportation bonds on the November ballot. And in December, Davis received praise from housing advocates across the political spectrum by appointing former Assemblywoman Julie Borenstein as director of the Department of Housing and Community Development. Meanwhile, legislative leaders also are likely to move on housing issues. Senate Housing Committee Chair Richard Alarcon, a Democrat who represents the San Fernando Valley, held a special "housing summit" at UCLA earlier this fall and declared that if the issue of affordable housing for working and middle-class Californians is not solved, "it will undermine our future." New Census Bureau statistics suggest that California's housing construction is not keeping up with either job growth or population growth. The Census reported in December that California had added 854,000 new housing units between 1990 and 1998 — a 7.6% increase and, in actual units, the second-highest total in the nation behind Florida. But the number of new homes was behind the state's increase in new households, which totaled more than 1 million during this period. Furthermore, California's percentage increase in housing construction lagged far behind all neighboring states, including Nevada, which led the nation with a 47.8% rise. Several reports have concluded that the state is now adding approximately three jobs for every housing unit constructed, The ratio is as high as 9:1 in economically booming Santa Clara County, where home prices have doubled in the last three years. And the California Building Industry Association recently reported that 15 of the 25 most "unaffordable" metro areas in the nation are located in California, including several in the Central Valley. Furthermore, even as the economy continues to boom, housing starts actually declined last summer. While there is little question that housing is a problem, it remains to be seen what steps — besides a housing bond — Davis and the Legislature are willing to take to improve the situation. The Legislature approved $22 million in appropriations for housing programs last year — up from virtually nothing under Gov. Pete Wilson — and housing advocates say they will aim for $100 million in the 2000-01 budget. "It wasn't a bad start after 15 years of drought," said Marc Brown, a housing lobbyist for California Rural Legal Assistance. Virtually all parties also hope to increase California's low-income housing tax credit program from $35 million to $50 million per year. As for the housing bond, both advocates and legislative leaders seem to be angling for a bond on the November ballot that would provide somewhere between $750 million and $900 million. Housing bond negotiations bogged down late last year, in part because Davis's office wanted to focus more on providing funding for single-family home ownership opportunities while legislative leaders, such as Alarcon, wanted to concentrate on rental housing instead. But with housing a higher priority, it appears likely that all sides will work harder to put aside their differences and get a bond on the ballot. "Our position is, we support what's going to pass with the voters," said Timothy Coyle, senior vice president for governmental affairs for the California Building Industry Association. "In today's market, you're going to have to provide some public assistance. In either case , you're not going to come close to meeting the need with the bond." And without committing the administration to a particular position, Borenstein indicated that even single-family assistance can aid renters. "If you help people who are renters to buy houses, then you can free up rental units," she said. The question of housing policy reform is much more up in the air. Both the administration and legislative leaders seem relatively uninterested in pursuing a wholesale reform of housing element policy – especially if it might harm the chances of getting a housing bond on the ballot. "That's fairly consistent with the governor's point of view," Borenstein said in an interview. "The housing bond is one of the most direct ways to get citizens involved in the discussion and also to get housing built." Reforms in housing policy, she suggested, are more "indirect" and take longer to have an impact. But administration officials, legislators, and lobbyists are all talking about the possibility of housing policy reforms that promote more housing construction near job centers, thus promoting "jobs-housing balance" or "Smart Growth" principles. Assemblyman Tom Torlakson, D-Martinez, and chairman the Assembly Select Committee on Jobs-Housing Balance, is expected to promote some kind of jobs-housing balance legislation. The issues might get worked into the transportation bond, which is being heavily promoted by Senate President Pro Tem John Burton. Meanwhile, CBIA is aggressively promoting infill housing close to job centers, at least rhetorically. In listing his organization's priorities for 2000, Coyle mentioned construction defect liability reform first, but then added a series of infill — or, as he called them "urban-centric" — policy reforms. These include reform of redevelopment housing law, more work on brownfields cleanup, and limitations on litigation against infill sites under the California Environmental Quality Act. He also said CBIA would strongly support the transportation bond and other infrastructure funding proposals. "What we're trying to do is get to the connection between job growth and housing supply," Coyle said. Meanwhile, Smart Growth advocates such as State Treasurer Phil Angelides continue to promote the idea of requiring state housing and infrastructure funding programs to incorporate "Smart Growth" principles in their criteria. Angelides has already introduced such criteria into the low-income housing tax credit allocation process. He is attempting to do the same for the state's infrastructure bank, though he is running into resistance. Angelides has promised to push for Smart Growth criteria in allocating the housing bond money — and he may have considerable leverage because he is actively raising funds for the housing bond campaign. Angelides and other Smart Growth advocates are also expected to place such criteria on the allocation of money from the transportation bond, though this is likely to meet with considerable resistance. It is difficult to say how much impact all this activity will have if the Davis Administration chooses not to pursue housing element reform. Wholesale changes in housing element policy are always on the legislative agenda, but the interest groups are deeply divided over how to proceed. Housing advocates want the state to play a stronger role in dictating local housing policies, while local governments usually want to weaken the state's leverage over their local planning processes. A great deal is likely to depend on Borenstein, Davis's new housing director. A former law professor, Borenstein represented the Coachella Valley in the Assembly for one term. She was defeated by Republican Jim Battin, who still holds the seat. More recently she worked for State Controller Kathleen Connell as deputy controller for external affairs. Housing advocates were united in their praise of Borenstein "She's got great political skills," said CRLA's Brown. In dealing with local governments, Borenstein may choose to focus on implementing existing housing element law and redevelopment housing law, rather than seeking to reform them in the Legislature. As a legislator, she was involved in the ongoing controversy between Indian Wells and neighboring communities over Indian Wells's desire to turn housing obligations — and redevelopment housing money — over to other, poorer cities. Most recently, the city of Coachella rejected $1 million in low-income housing money that Indian Wells offered. Contacts: Timothy Coyle, California Building Industry Association, (916) 443-7933. Julie Borenstein, Department of Housing and Community Development, (916) 445-4775. Marc Brown, California Rural Legal Assistance, (916) 446-9241. Office of Assemblyman Tom Torlakson, (925) 372-7990. Office of Senator Richard Alarcon, (916) 445-7980.

When California's first "space-saver" school opens next fall in Santa Ana, it will be an immediate orphan. The program that gave birth to the school no longer exists. Instead, the state and school officials are pursuing different strategies to provide classroom space in growing urban districts, as evidenced by innovative new schools in Pomona and Long Beach. The state space-saver program, launched with great fanfare during the early 1990s, sought to solve the problems of growing urban districts by offering to finance half of new school construction on high density parcels. But only two schools are ever expected to be built in the state under the program: the Mendez Fundamental Intermediate School in Santa Ana and one expected to open near Los Angeles's California Science Center in 2003. Still, urban school districts find themselves in a difficult predicament: growing enrollments dictate the need for more classrooms, but the large parcels needed to construct new schools have disappeared. The ongoing debacle over Belmont Learning Center in Los Angeles — a large downtown school on which the school district spent $170 million before halting construction because of soil contamination and seismic safety concerns — underscores how difficult it is for urban districts to find suitable land for such development. (See CP&DR Deals, April 1998, CP&DR Schools Watch, December 1996.) But a variety of creative efforts are springing up around the state to deal with the classroom shortage. And with bond money from last year's Proposition 1A still available for school construction, districts likely will continue to come up with new ideas for building. The typical suburban school campus is on 10 to 12 acres, most of which is used for playgrounds. Some districts, such as Anaheim Elementary in Orange County, are now considering building completely new schools on those playgrounds, said Duwayne Brooks, director of the school facilities planning division for the California Department of Education. The Los Angeles Unified School District is considering several joint use projects with existing schools. One plan is to build a 1,500-student high school campus on land that is part of East Los Angeles Community College. The high school students would share the college's existing athletic and cultural facilities. Los Angeles Unified is also building smaller schools for kindergarten through third graders because those schools can be built for fewer students and need less real estate. Other districts, such as Lodi Unified in the Central Valley, have built schools next to parks so that parkland becomes the school's play area. Schools reciprocate by opening gymnasiums at night for community use, Brooks said. The hottest concept right now is increasing the use of two-story portables, according to Jim Murdoch, director of the Coalition for Adequate School Housing in Sacramento. Los Angeles Unified and Capistrano Unified in South Orange County are two districts using the newest portables. One of the more unusual projects to find new space for schools is under way in Pomona, where a failing 40-acre shopping center is being converted into a mixed-use educational and commercial center. While definitely not a space saver, the Pomona Educational Center is reusing existing buildings. When it opens next fall, 1,800 kindergarten through sixth-grade students will attend classes in the Pomona Educational Center — next to a drug store, cinema and restaurant — in the Village at Indian Hills shopping center. The school will also contain a conference center, teacher training facilities and adult education facilities, according to Tom Blurock, the project architect. The school could be converted to a high school in the future. With sites limited in urban areas, "you have to be more opportunistic," he said. And distressed commercial areas offer possibilities for elementary schools. "That's kind of the flip side of the space-saver," he said. The school district is converting parking lots behind the buildings into playgrounds and athletic fields. Total development cost is about 80% of normal, according to Blurock. The Mendez space-spacer school, while built on a small parcel of land, is also located in a shopping center in Santa Ana called Bristol Market Place. Blurock said other clients, including the Hawthorne School District, are considering commercial sites for future schools, although in that city, the old mall that is being eyed may have to be torn down before construction can begin. Blurocks' Orange County firm also recently designed a school in downtown Long Beach, that did not get state space-saver money, but exemplifies how to fit a school into a tight space. The 950-student Long Beach International Elementary School sits on 2.5 acres. A concrete deck over classrooms serves as a playing field, and a small site across the street is being renovated into a quarter-acre park. The site was formerly the school district's headquarters and parking lot. The district moved its offices to a more suburban neighborhood in Long Beach to free up the land. The school did receive about half its $14 million funding from Roos funds, another state program (now ended) aimed at helping urban districts develop constrained school sites. When state Senator Leroy Greene of Sacramento first introduced the idea of space-savers in 1991, his idea was to help urban districts such as San Francisco find ways to build new schools without resorting to eminent domain. Greene, who had been a civil engineer, envisioned schools built on top of parking garages at Candlestick Park in San Francisco and Dodger Stadium in Los Angeles, or building a school on a bridge over the Los Angeles River. The cost of the facility could be no more than building a standard school. But districts foresaw a lot of paperwork, and stadium officials did not jump at the notion of converting their empty parking lots into schools. The Los Angeles space-saver project is expected to receive funding next year, according to Lyle Smoot, the state building program coordinator for the LAUSD, and a former employee at the state allocation board when the space-saver program was established. The school will be located at Exposition Park in a renovated building that is currently used by the California Science Center. The three-story building will continue to house some of the Science Center on the top floor when it is completed. The second space-saver school will probably be the last. The authority to make allocations for space-saver projects was deleted by SB 50, passed in 1998 as part of the legislation that led to Proposition 1A. Contacts: Duwayne Brooks, California Department of Education, (916) 445-2144 Tom Blurock, architect, (949) 646-9373 Lyle Smoot, Los Angeles Unified School District (916) 442-2591 Jim Murdoch, Coalition for Adequate School Housing, (916) 441-3300