The long-running feud over school impact fees was supposedly settled with passage of last year's SB 50 and subsequent approval by voters of Proposition 1A, a $9.2 billion school construction and rehabilitation bond. Some city and school officials, however, continue to argue that schools need more money from developers than allowed by SB 50, and a few cities appear openly defiant of the law. In Livermore, for example, homebuilders still pay more than double the SB 50 cap of $1.93 per square foot as part of an uneasy truce with the city. "If they didn't want to pay for the impacts of their development, then we weren't going to develop any more," Livermore Mayor Cathie Brown said recently. State lawmakers, builders and school supporters last year cut a deal in which builders agreed to back the bond measure in exchange for an impact fee limit of $1.93 per square foot on new homes. The legislation also attempted to clamp down on jurisdictions that ignored a previous impact fee limit. The law went so far as to state that payment of the $1.93-per-square-foot fee was "hereby deemed to be full and complete mitigation of the impacts … on the provision of adequate school facilities." Senate Bill 50 suspended for eight years the Mira, Hart, Murrieta court precedents that let cities reject developments on the basis of inadequate schools. The measure also prohibited the often-used tactic of forcing developers to join a Mello-Roos district to raise additional funds for school construction. Despite last year's deal, the issue is not settled. An analysis by the California Chapter of the American Planning Association states, "The bill was crafted mainly behind the scenes by the legislative leadership and contains vague language, technical problems and inconsistencies as a result. … any issues will have to be addressed in follow-up legislation or court cases, since the new law does not provide clear direction in some cases, or any direction at all in others." However, Richard Lyon, senior legislative advocate for the California Building Industry Association, said people should let the new program run its course before tinkering with it. "One of the problems we have with cleanup legislation is that the program hasn't even been operating. What we've been arguing is that we need to let it operate, give it some breathing room for a couple of years before we know if cleanup is needed," Lyon said. While the new law makes clear that cities and counties cannot deny a project or require fees greater than $1.93 per square foot, questions remain over how to apply the California Environmental Quality Act. In many instances, school officials say $1.93 per square foot does not provide enough money to meet Proposition 1A's local match requirement. Under one interpretation, CEQA requires an environmental impact report for every project with unmitigable school impacts. Under another interpretation, SB 50 removes schools from CEQA review because the legislature deemed payment of $1.93 per square foot as full mitigation. Scott C. Smith, general counsel to CCAPA, recommended local agencies document the shortfall in the environmental review and note that the state prevents further mitigation. Whether that environmental review must include an EIR is a live question. There is no case law on the subject; follow-up legislation this year is unclear. Senate Bill 50 still allows school districts to issue bonds to achieve the local match, and it allows schools and cities to request — but not require — that developers pay more than $1.93 per square foot. Bay Area Cities Chart Own Course Among the most aggressive cities in exacting school fees is Livermore. Leaders of the Alameda County town vowed not to abide by the $1.93-per-square-foot maximum and instead crafted an agreement with local developers that calls for builders to pay about $5 per square foot, Mayor Brown said. The Livermore Valley Joint Unified School District will repay developers up to half of the fee if, and when, the school district receives adequate state funding to build new facilities. City officials, school district representatives and some developers hashed out the agreement to end Livermore's moratorium on new subdivisions, Brown explained. "The school district and the developers convinced the other developers we could not build new schools with the fees they wanted to pay," Brown said. Plus, the city was not going to budge. "The developers who are here now are working with us," she added. Lyon, of the CBIA, said Livermore homebuilders accepted the deal because it got Livermore schools into the state construction program for the first time. Previously, the school district insisted builders shoulder all costs of school expansion, he said. Livermore's status as a hot real estate market where developers are eager to build undoubtedly gave city leaders confidence, as did success in defending an earlier lawsuit filed by the Homebuilders Association of Northern California. In an unpublished opinion filed in February, the First District Court of Appeals upheld the city's previous method of exacting up to $6 per square foot in school impact fees. The court has since granted a rehearing. Backlash to development is pushing growth-control initiatives onto upcoming ballots in the Tri-Valley area. That citizen outcry may embolden other Tri-Valley cities to insist — somehow — on higher school fees. In Pleasanton, a citizen group called Reduce Overcrowded Campuses is insisting the school district add one high school and one elementary school to a master plan. But city and school officials did not include those additional schools in previous financing equations, which puts them face to face with the impact fee limit, said Pleasanton Planning Director Brian Swift. Pleasanton since 1992 has charged two to three times the amount allowed by state impact fee limits. (As in all jurisdictions, contracts between Pleasanton and developers for higher fees signed prior to SB 50 remain in effect.) Like the new arrangement in Livermore, developers in Pleasanton get some fees refunded if the schools receive adequate state money. The Pleasanton agreements allow for annual review. The question is whether the city could increase those agreements' school impact fees in light of SB 50, said Swift, who is doubtful. Money in the Pipeline Elsewhere in California, however, the availability of Proposition 1A funds has silenced the debate over school impact fees. James Murdoch, lobbyist for the Coalition for Adequate School Housing, said impact fees are not a subject of discussion among the group's 500 member school districts. "As a result of Senate Bill 50 and all the local bond issues that have passed, there is a ton of money out on the street, which districts are accessing to build schools," Murdoch said. Kent Hunt, spokesman for the state's General Services Department, said spending the $6.7 billion Proposition 1A earmarked for new schools is going according to the four-year allocation plan. Many CASH members are urban school districts, which are not often affected a great deal by growth, Murdoch conceded. For that reason, the coalition backed the SB 50/Proposition 1A package because it contained costs for builders and provided state funds for schools, he said. The concern for CASH has become Proposition 1A's limited funding for modernization, which totals $2.1 billion. "I think that the (Proposition 1A) money for growth is adequate. It appears that the money for modernization is not. It is being used up rapidly," Murdoch said. Murdoch is not the only person who sees the school impact fee cap having different effects on different districts. According to the California School Boards Association, small school districts may not have enough growth to generate the 50% match required to get Proposition 1A funds, and they can no longer fall back on the Mira, Hart, Murrieta cases to exact additional fees. Districts can issue bonds for the local match, but they need a two-thirds majority vote, which can be more difficult to achieve in small districts. Livermore Mayor Brown, however, contended SB 50 hit hardest in suburban cities where growth is causing the need for more schools, not in slow-growing areas with small districts. Smith, the CCAPA attorney, said nothing in SB 50 prevents city officials from asking that developers talk with school officials about higher impact fees. At the same time they make that request, city officials might want to note the marketability of a subdivision with overburdened schools, he said. Contacts: Cathie Brown, Livermore mayor, (925) 373-5149. Brian Swift, Pleasanton Planning and Community Development director, (925) 484-8023. James Murdoch, Coalition for Adequate School Housing lobbyist, (916) 441-3300. Richard Lyon, California Building Industry Association senior legislative advocate, (916) 443-7933.

The gavel came down last year on the greatest job auction of all time: The State of Kentucky agreed to give Willamette Industries up to $8.8 million in tax credits for each new job the company would provide in the City of Hawesville. As it turned out Willamette created 105 jobs instead of the required 15, so the subsidy was only $1.26 million per job. In that light, the $35 million subsidy approved last month by the Los Angeles City Council to the developer of the Playa Vista development seems like small change. This deal promises to pay a between $81,000 and $172,110, in present-day dollars, for each job created at Playa Vista. Still, at that rate, the Playa Vista deal may be a candidate for the annual "Terrible Ten Corporate Candy Store Deals" compiled by Greg LeRoy, director of Good Jobs First, a project of the Institute on Taxation and Economic Policy in Washington, D.C., LeRoy's eye-opening compendium of the Terrible Ten for 1998 was published in the May issue of The Progressive magazine. Five of the 10 deals in this year's list offered subsidies of $100,000 or more per job. In Alabama, for example, LeRoy estimates that corporations will be entitled to $6.4 billion in tax credits during the next 20 years, or $280,000 per job for the 22,668 jobs created last year by corporations that took advantage of the state's incentives. At Playa Vista, the actual tax credits range from $2,700 to $5,737 annually for 30 years, depending on the salary level and the type of job. Playa Vista is a 1,087-acre entertainment and technology-oriented development on the Los Angeles oceanfront. The development partnership, known as Playa Group, proposes 5 million square feet of industrial buildings and more than 4,000 housing units on the degraded wetlands and old industrial sites formerly owned by Howard Hughes. The most notable tenant of Playa Vista, of course, is DreamworksSKG, the new film studio created by Steven Spielberg, David Geffen and Jeffrey Katzenberg, which will use the tax credits for its expected staff of 1,000 people. Not surprisingly, Dreamworks is viewed as a sort of "anchor tenant" that can attract many other technology- and entertainment-related companies to Playa Vista. The Dreamworks lease is a big deal to the city, psychologically as well as fiscally. The agreement is one of the peak achievements of Mayor Richard Riordan's business retention efforts. Previously, the mayor's office had been active in retaining at least two other media companies, Capitol Records and Chiat Day. While any city would be pleased to hang onto major employers, Los Angeles is particularly sensitive about business retention, because the city has watched numerous corporate headquarters leave town. Predictably, there are the pointy-head types who object to big public subsidies to the likes of Dreamworks and Morgan Stanley, a partner in Playa Vista. (God knows why.) But even a cold-eyed, business-minded look at this package questions whether it is worth its salt in economic-development terms. Arguably, subsidies for a steel mill in Alabama or a paper mill in Louisiana are more defensible than the Playa Vista incentives. In depressed urban areas and in underdeveloped rural areas alike, the presence of major employers can create new "clusters," to borrow a term from the economic development experts. Not only will the big plant employ hundreds of people, but the big plant will function as an economic "anchor" for many ancillary businesses that support it, directly or indirectly — parts suppliers, messenger services, real estate brokerages, fast food restaurants, and so on. The problem with the Playa Vista deal, on the other hand, is that the economic cluster already exists. Here, we assume that Dreamworks will be the anchor tenant that will attract many smaller businesses of similar ilk. Obviously, the film business has already spawned an immense human and physical infrastructure in Los Angeles. True, Dreamworks and other new tenants can reasonably be expected to add new wealth to this infrastructure. But "the synergistic effect may be muted, because the cluster already exists," says Jeff Finkle, president of the Council on Urban Economic Development in Washington, D.C. But what about job creation, the rationale for subsidies? Playa Vista promises to become a major business center. Still, the economic benefits for the City of Los Angeles remain somewhat intangible. True, Playa Vista, a condition of receiving the tax credits, will provide an impressive 6,300 jobs exclusively for Los Angeles residents. On a regional basis, however, that seems less impressive because those jobs were going to be in the Los Angeles area anyway. Unlike Mercedes, Dreamworks cannot locate in Alabama. A major film studio can only go to Los Angeles or New York. And not just anywhere in Los Angeles: Keep in mind that film studios are major land users, sometimes covering hundreds of acres. Dreamworks will cover at least 47 acres. The most important question remains: Did Los Angeles overpay for the jobs? It depends on how you look at it. By corporate standards, the rate appears to be in the high-but-defensible range. By the standards of genuine job creation and net economic development, however, probably. Dreamworks and other entertainment-related tenants need to be in greater Los Angeles, if not in Los Angeles proper. The most attractive part of the deal is that a third of the jobs are earmarked for city residents. On the other hand, many of those jobs would have gone to Los Angeles residents anyway, because Los Angeles is where the great majority of people in the entertainment industry live. (Here we are talking about the lower- and mid-level studio, post-production and technology-related employees, not just moguls and stars.) So what is the Los Angeles City Council really paying for? In a word, marketing. Landing Dreamworks and its hangers-on means that the city can be perceived as a viable location for major entertainment companies. A major new corporate headquarters is a marketing coup for an insecure city. But let's not mistake marketing for economic development. At this point, Los Angeles residents might be forgiven for having a sinking feeling that they have waived $35 million in tax revenue merely for the privilege of saying that Los Angeles is the home of Dreamworks. Even in Tinseltown, that's a lot to pay for symbolism. But in this uncontested auction, that's exactly what Los Angeles has bought.

Once the butt of many jokes, downtown San Jose has become an increasingly popular location. Among the latest to indicate interest in a downtown office tower is the city itself, which proposes building a $214 million Civic Center on the eastern edge of downtown. The city has completed an environmental impact report, and the City Council was expected on June 1 to approve the EIR, a new redevelopment area, a housing relocation plan, and a financing program. City officials hope the project will solve the municipal office space squeeze, improve customer convenience by locating most departments in one place, provide an anchor for that part of downtown, and serve as a symbol for the city. To accomplish that final goal, the city has hired architect Richard Meier, who most recently design the acclaimed Getty Center in Los Angeles. Meier is scheduled to unveil a conceptual design this month. "Meier is a bold choice for San Jose," the Mercury News said in a recent editorial. "His buildings are unlike anything that has been built downtown." The city's existing City Hall north of downtown is full, forcing the city to lease office space wherever it is available, city spokeswoman Leslee Hamilton said. "The real estate market is very expensive to lease space in because the market is so hot," she said. Moreover, spreading departments over numerous buildings can confuse citizens or require them to make trips to multiple locations. The proposed building would provide 550,000-square-feet of office space, including a new City Council chambers. About 2,000 people would work in the 230-foot tower. Plans also call for 1,650 parking spaces in on-site and off-site parking garages, public plazas and a parcel reserved for expansion. San Jose has focused on downtown since the 1980s, and even some technology companies that have thrived in outlying business parks are locating offices in downtown. The city and private builders have invested more than $1 billion in downtown redevelopment, Hamilton said. The planned Civic Center site lies within the proposed, seven-block Civic Plaza Redevelopment Project Area east of the thriving downtown district. Other projects planned for the area, which is next to San Jose State University, are a symphony hall, a rebuilt elementary school, and a church to replace one that burned down a while back, according to a memorandum from Public Works Director Ralph Qualls Jr. Although the new City Hall is the key component of the proposed seven-block redevelopment area, the city itself � not the redevelopment agency � intends to issue bonds to fund construction. The project must be consistent with Measure I, which city voters approved in 1996. The charter amendment allows the City Hall construction but prohibits imposition of new taxes or transferring funds from existing programs. The project is not without drawbacks. An EIR by David J. Powers and Associates listed 13 significant, unavoidable impacts on traffic, parking, historic resources and air quality. The site � on the south side of East Santa Clara Street between 4th and 6th streets � is farther from freeways than the current City Hall. "For someone coming from out of the area, it's probably going to be a little bit harder to get to," said Julie Capourgno, a city planner who oversaw EIR preparation. The Planning Commission approved the EIR in April, but a citizen, worried about traffic congestion and a lack of parking, filed an appeal that the City Council was scheduled to hear June 1. The analysis also predicts significant construction impacts to residences and a nearby school, and a land-use compatibility problem when a parking garage is built next to a residential structure. The redevelopment agency is considering moving six 100-year-old Victorians that are eligible for historic protection, Capourgno said. Last September, the City Council appointed a Project Area Committee of residents and business owners. Real estate acquisition and relocation of existing residents and merchants have been issues of concern for the committee, as has disturbance during three years of construction. The schedule calls for the city to sell the bonds and award a construction contract toward the end of 2000, according to Qualls. Seventeen city departments would begin moving into the new City Hall in fall of 2003. Contacts: Julie Capourgno, San Jose planning department, (408) 277-4576. Ralph Qualls Jr., San Jose public works department, (408) 277-4337.

The City of Burbank, which has vigorously fought a proposed Burbank Airport expansion, won a major victory when the Second District Court of Appeal ruled the Airport Authority must receive approval from the city before proceeding with a new terminal. In a ruling delivered May 5 and ordered published on May 20, a unanimous three-judge panel said the Burbank-Glendale-Pasadena Airport Authority must submit its land use plans for city approval, and must get the city's approval to condemn land for the project. "The Authority apparently perceives itself so unrestricted in the manner of exercising its claimed implied power of land-use review that it need undergo no review at all," Presiding Justice Mildred Lillie wrote. "However, a city may not delegate discretionary powers in such a way that results in total abdication of those powers." The appellate court decision overturns a February 1998 superior court ruling, which said the city delegated its land use power when it approved the 1977 agreement creating the Airport Authority. The Airport Authority wants to build a 19-gate terminal on 130 acres owned by Lockheed Martin Corp. adjacent to the airport. The proposed terminal, which could be expanded to 27 gates, would replace the existing 14-gate terminal. The Airport Authority had hoped to complete the $250 million project by spring 2002. The city rejected the expansion plan in 1996. The Airport Authority has not yet decided whether to ask the California Supreme Court to review the decision, said Victor Gill, director of public affairs and communications. Burbank Mayor Stacey Murphy said, "Although we have already rejected the Authority's expansion plan, we welcome them to come to the city and seek our reconsideration of a more modest project proposal that is sensitive to the needs of our community." Late-night noise is the city's chief concern. The appellate court said the city retains its right to impose noise restrictions. But one week after the appellate court ruling, the Federal Aviation Administration said the city cannot impose a nighttime curfew on the airport. The FAA said only the owner of an airport may adopt a curfew, and then only after a noise study. Contacts: Stacey Murphy, Burbank Mayor, (818) 954-1845. Victor Gill, Burbank-Glendale-Pasadena Airport Authority, (818) 840-8840.

Alameda County transportation officials cannot change the route of a new highway to be funded by a county sales tax without returning to the county's voters for approval, the First District Court of Appeal has ruled. The ruling overturned a decision by Alameda County Superior Court Judge Henry E. Needham Jr. which granted summary judgment to the Alameda County Transportation Authority in the case. The First District remanded the case to Superior Court for a new decision on a citizen group's request for an injunction against the Transportation Authority. The Transportation Authority had sought to use county "Measure B" funds for the Hayward Bypass even after moving the proposed route from Foothill and Mission Boulevard to the hillsides above the city. But the First District found this action to be a violation of Bay Area County Traffic and Transportation Funding Act, the 1986 law that authorized Bay Area counties to place sales-tax increases on the ballot for transportation purposes. "If the tax revenues generated by Measure B are now taken and applied to an entirely new highway alignment for which no tax was authorized, the many protections the Act provides — full disclosure of the expenditure plan, strict limitations on the use of voter-generated tax revenues, and voter involvement in the expenditure plan amendments — are thus amended, affording no protection whatsoever to taxpayers," Justice Ignazio Ruvolo wrote for a unanimous three-judge panel of Division Two of the First District. Indeed, in his ruling, Justice Ruvolo hinted that the Transportation Agency had deliberately placed the expressway option in front of the voters because officials were fearful that the foothill route would engender opposition. Alameda County voters approved Measure B in November of 1986, shortly after the enabling legislation was passed. The measure increased county sales taxes by a half-cent for 15 years and gave the resulting revenue to the Transportation Authority to fund 11 transportation projects laid out in an expenditure plan listed as part of Measure B. One of the proposed expenditures was a series of projects collectively known as "Route 238 and Route 84," which was expected to cost $134 million. One piece of the Route 238/Route 84 project was a six-lane freeway or expressway that would connect the interchange of State Route 238 and Interstate 580 with Industrial Boulevard in Hayward, a distance of approximately 5.4 miles. In 1997, the Hayward Area Planning Association, a citizen group, sued the Transportation Authority. The citizen group claimed that the agency had abandoned plans for the Foothill/Mission expressway and planned instead to build the Hayward Bypass through the Hayward foothills, a half-mile away from the previously selected corridor. The citizen group asked Judge Needham for an injunction blocking the transportation agency from spending Measure B funds on the Hayward Bypass. Needham granted summary judgment in favor of the transportation agency and the citizen group appealed. On appeal, the Transportation Authority argued that the suit was not ripe for legal challenge because no final decision regarding the alignment of the Route 238 corridor can be made until environmental review and planning documents are approved. The First District rejected this argument, concluding that the central question of whether the original route must be followed "is a purely legal question." Moving on to the merits of the case, the First District concluded that the basic question was whether voter approval of Measure B meant that the Transportation Authority had to build specific route alignments, or, rather, that the agency had discretion to build transportation projects along any alignment so long as the origin and destination described in Measure B (in this case, the freeway interchange and Industrial Boulevard) were connected. In arguing for their ability to change the route alignment, the Transportation Authority and Caltrans, which was a co-defendant in the case, claimed that the state Streets and Highways Code grants final authority over route alignments to Caltrans and the California Transportation Commission. The appellate court did not agree. Route alignments may require Caltrans or California Transportation Commission approval, but if routes are funded by Measure B, only the voters may alter them. "The proposal submitted to the voters of Alameda County was, by its very terms, limited to funding certain specific projects described in the Expenditure Plan," Justice Ruvolo wrote. "The voters did not authorize expenditure of the sales and use tax money to be used in a manner vested to the unbridled discretion of Caltrans. This is contrary to the express terms of the ballot information submitted to the voters and the express terms of the Act." The First District noted especially that "had only the termini been designated, or the now-preferred Hayward Bypass alignment been specified, the result of the election might have been entirely different," Indeed, in a footnote, the court pointed out that the citizen group had presented a declaration from a former county supervisor indicating that the expressway route was selected precisely because of potential opposition to the foothill route. The Case: Hayward Area Planning Association v. Alameda County Transportation Authority, 1999 Daily Journal D.A.R. 4597, 99 C.D.O.S. 3624 (filed May 17, 1999). The Lawyers: For Hayward Area Planning Association: Stuart Flashman, (510) 652-7353. For Alameda County Transportation Authority and other transportation agency defendants: Susan Dovi, Caltrans, (415) 982-3130.

WASHINGTON — The U.S. Supreme Court gave property owners the right to jury trials in federal court in regulatory takings cases brought against state or local governments under the federal civil rights law. The 5-4 ruling handed down in late May upheld a $1.45 million jury award won by a developer against the city of Monterey for blocking a planned oceanfront residential development during the 1980s. The division in the case was mostly along normal conservative-liberal ideological lines, with conservative justices backing the developer's right to a jury trial while liberal-leaning justices voted against it. However, Justice John Paul Stevens — a former Chicago city attorney and usually a reliable vote for the government in property rights cases — left the liberal bloc to vote in favor of permitting jury trials. Justice Sandra Day O'Connor, who has generally supported broader property rights, voted against it. Michael Berger, the longtime property rights litigator who represented the developer, predicted the decision would encourage more such suits and discourage local planning agencies from giving "the runaround" to developers and property owners. "It's going to make people take notice that when they act this way, there is a penalty," the Santa Monica-based lawyer said. But George Yuhas, the San Francisco lawyer who represented Monterey, called the ruling "a narrow decision" with an uncertain long-term impact. "It depends on how courts apply the decision," Yuhas said. "I'm cautiously optimistic that courts will give the decision a narrow scope" The decision for Del Monte Dunes at Monterey, Ltd., reflected the justices' evident disapproval of the city's treatment of two separate developers who unsuccessfully sought permission to build on a 37.6-acre parcel over a five-year period. The city rejected five applications and 19 different site plans for the residentially zoned property along Highway 1 in north Monterey, even though developers continually scaled down the project. The city said it wanted to protect habitat for a rare butterfly. All of the justices joined the first sections of Justice Anthony Kennedy's opinion, which depicted the parcel as a neglected, spoiled site and the developer's plans as sensitive to land use and environmental issues. But the justices divided on the legal issue of whether the developer was entitled to a trial before a jury rather than a judge in a suit brought under the Reconstruction-era federal civil rights law, 42 U.S.C. section 1983. The law permits money damages and injunctions against state or local governments for actions that interfere with federal constitutional rights. Traditional civil rights plaintiffs have made frequent use of the statute in recent decades, but only recently have developers and property owners turned to it as a vehicle for taking complaints about unfavorable land use decisions into federal court. In this case, Del Monte Dunes claimed the city's final rejection in 1986 of its pared-down plans for a 190-unit development on the site violated its property rights under the Fifth and Fourteenth Amendments by denying any "economically viable use" of the land. After preliminary legal battles, the judge in the case ruled that Del Monte Dunes was entitled to a jury trial on the major parts of its suit. The jury found that the city's actions amounted to a "temporary taking" and a violation of the developer's equal protection rights and voted a $1.45 million-damage award. The city, supported by an array of local government and planning organizations, urged the high court to bar jury trials in such cases. Berger attracted support from property rights groups, the National Association of Home Builders and the American Farm Bureau Federation in arguing in favor of jury trials. For the high court, the issue turned on an interpretation of the Seventh Amendment, which provides that the right to jury trial "shall be preserved" as it existed at common law. The amendment, which applies only to federal courts, has spawned an assortment of rulings that turn on efforts to draw analogies between newly created legal remedies and suits recognized in America and England in the 1700s or before. The court divided three ways on the question. In the main opinion, Kennedy reasoned that the takings claim amounted to "an action at law" — the phrasing from the Seventh Amendment — because it sought "a compensatory remedy" for "a constitutional violation." He went on to carefully distinguish between a takings claim and a normal inverse condemnation suit, which he said would not need to be tried by a jury. Only three other justices joined that passage of Kennedy's opinion. Justice Antonin Scalia provided the fifth vote for the decision in a separate, broader opinion. Scalia said that any suit brought under section 1983 gave rise to a right to a jury trial and that the distinctions in Kennedy's opinion were "irrelevant." In an odd twist, Kennedy added a sentence to his opinion agreeing with much of Scalia's reasoning. In the dissenting opinion, Justice David Souter argued that the Seventh Amendment did not apply because there was no analogous legal action at the time the Constitution was written. "The notion of regulatory taking or inverse condemnation was yet to be derived," he wrote. The justices also divided on the likely impact of the ruling. Kennedy, in a passage that Scalia did join, minimized the potential effects on local land use decisions. He noted that federal courts cannot entertain takings claims "unless or until the complaining landowner has been denied an adequate postdeprivation remedy." Kennedy also emphasized that Del Monte Dunes was complaining only about the city's action in its case and was not broadly challenging the constitutionality of the city's planning and land use policies. But Souter said Kennedy's qualifications would provide "cold comfort" to local governments. "The narrowness of the Court's intentions cannot be accepted as an effective limit on the consequences of its reasoning," Souter wrote. Property rights groups praised the court's decision. James Burling, a lawyer with the Pacific Legal Foundation in Sacramento who filed a friend of the court brief, called the decision "a major victory for landowners, who are now assured of having their grievances against government heard by members of their own community who also may be impacted by regulatory actions." On the opposite side, John Echeverria, a professor at Georgetown University Law Center in Washington, D.C., who filed a brief on behalf of environmental organizations, said the decision was "a disappointing loss for local government in California and across the country." Having the right to a jury trial, Echeverria said, "gives developers more leverage in negotiating with local government and gives them a valuable tool if they go to litigation." The Case: City of Monterey v. Del Monte Dunes at Monterey, Ltd., No. 97-1235, 99 C.D.O.S. 3846, filed May 24, 1999. The Lawyers: For Monterey: George Yuhas, Orrick, Herrington & Sutcliffe, (415) 773-5492. For Del Monte Dunes: Michael M. Berger, Berger & Norton, (310) 449-1000. Kenneth Jost, formerly editor of the Los Angeles Daily Journal, is staff writer for Congressional Quarterly and author of The Supreme Court Yearbook.

Business Improvement Districts created by cities under the Parking and Business Improvement Area Law of 1989 are not subject to the voting requirements of Proposition 218, the Fourth District Court of Appeal has ruled. The unanimous three-judge panel said that Proposition 218 has no effect on cities' ability to levy assessments under the 1989 law (Streets & Highways Code §§ 36500-36551). The court concluded that San Diego's Pacific Beach Business Improvement District did not impose an "assessment" within the meaning of Proposition 218. In a decision closely watched by cities around the state, the court noted the difference between the 1989 measure, which allows assessments on business owners, and the Property and Business Improvement District Law of 1994, which provides for levies on property. For all 16 of its Business Improvement Districts, San Diego assesses business owners — not property owners — under the 1989 law, Deputy City Attorney James Chapin said. "That's the critical distinction for the purposes of Proposition 218," he said. If San Diego relied on the 1994 law to create the BID, "we wouldn't have been successful" because a BID based on the 1994 law would be subject to the proposition, he said. California voters approved Proposition 218 — the Right to Vote on Taxes Act — in November 1996. The measure requires two-thirds voter approval for adoption, extension or increase of taxes or assessments on real property. The initiative threw into question the validity of many lighting and landscaping district assessments and other levies issued by cities and special districts for specific services. The City of San Diego created the Pacific Beach BID to acquire, construct and maintain parking facilities in the area, to promote public events in the area, to furnish music, and to decorate the district. Business Improvement Districts are increasingly popular tools to raise revenue to fund street fairs, dress up neighborhoods and even add private security (see CP&DR Trends, December 1998). In fact, 85 cities joined in an Amicus Curiae brief to aid San Diego's case. In the Pacific Beach BID, the city assesses businesses based on the business size, type and location within the district. San Diego based the BID on the 1989 Parking and Business Improvement Area Law, rather than the Business Improvement District Law of 1994 (§ 36600). Four businesses registered their opposition to the Pacific Beach BID during a public hearing in June 1997, but the city went ahead with the BID anyway. The four business are assessed $60 apiece every year, according to Chapin. Arguing that the BID assessment violated Proposition 218, the protesting businesses and the Howard Jarvis Taxpayers Association then filed suit for declaratory and injunctive relief. San Diego County Superior Court Judge S. Charles Wickersham awarded the city summary judgement on the bases that Proposition 218 did not apply to the BID. On appeal, the BID opponents argued that Proposition 218 provides a "constitutional definition of assessment" that includes, but is not limited to, special assessments, benefit assessments, maintenance assessments, and special assessment taxes. The court, however, noted that Proposition 218 specifies "any levy or charge upon real property." "Proposition 218 clearly does not state a constitutional definition of assessment for all constitutional and statutory provisions," Presiding Justice Daniel J. Kremer wrote for the Fourth Appellate District, Division One. "To read such an all encompassing ‘constitutional definition' of assessment into Proposition 218 would require us to ignore the clear language of the proposition and rewrite the proposition. This we may not do." Extending Proposition 218 to other assessments not based on real property would result in the repeal of numerous levies, ranging from assessments on health care providers for state oversight, to assessments on avocado growers to fund the California Avocado Commission, the court said. The court also rejected the BID opponents' argument that the Pacific Beach BID levied a "special tax" within the meaning of Proposition 218. State law recognizes a distinction between a special tax and a special assessment. The California Supreme Court in Knox v. City of Orland, (1992) 4 Cal4th 132, explained that a special assessment is a "compulsory charge to recoup the cost of a public improvement made for the special benefit of a particular property." A special tax, meanwhile, is levied "without reference to peculiar benefits to particular individuals or property." The court in Evans v. City of San Jose, (1992) 3 Cal.App.4th 728, ruled that a levy imposed on business owners under the 1989 Parking and Business Improvement Area Law was not a special tax and was not subject to Proposition 13 because it benefited a discreet group. The reasoning in Evans applies to the San Diego case, the court said. Proposition 218 did not overrule the Evans decision, not did it change the meaning of "special taxes," the court said. The Case: Howard Jarvis Taxpayers Association v. City of San Diego, No. D031348, 99 C.D.O.S. 3693, 1999 Daily Journal D.A.R. 4719, filed May 19, 1999. The Lawyers: For Jarvis: Trevor A. Grimm, (213) 380-0303. For San Diego: James M. Chapin, deputy city attorney, (619) 533-5800.

Although new guidelines for implementing the California Environmental Quality Act went into effect in February — the first major overhaul in 13 years — no one is suggesting they have wrought a revolution. Nevertheless, the Davis Administration has vowed at least to review the changes made during the final months of Pete Wilson's second term. Several years of haggling among planners, attorneys, environmentalists, developers and state officials resulted in revisions to the CEQA guidelines issued by the Office of Administrative Law in October. The attorney who guided the Wilson administration through the revisions, Maureen Gorsen, recently expressed disappointment that the guidelines were diluted to the point of not making major improvements to the CEQA process. "We were so consensus driven, I don't think there was anything in the guidelines that really changed anything," said Gorsen, who is now with McClintock, Weston, Benshoof, Rochefort, Rubalcava & MacCuish in Los Angeles. "We put so much hedging language in it to satisfy all of the interests." The revisions mostly codified court decisions and standard CEQA practices, she contended. Still, some environmentalists and planners worried that the revisions tilted the process too far toward development interests. Hoping to find an ally in Gov. Davis, they have lobbied the new administration to rescind or modify the revisions, according to Patrick Wright, Davis's new deputy secretary for resources. The Resources Agency will give a serious look at the guideline changes, Wright promised, but he did not provide a timetable for the review. "We have no preconceived agenda, and we don't know if there is anything that needs to be fixed or not," Wright said. "It's definitely something on our agenda as something we want to look at." The revisions to about 60 sections of guidelines constituted the first overhaul since 1986, and agencies were supposed to comply with the new guidelines by late February. The guidelines do not carry the weight of law, but judges often refer to them when deciding CEQA cases. "The primary mandate that these revisions fulfill," Gorsen wrote at the time "is to provide objectives, criteria and guidelines for the orderly evaluation of projects and the preparation of EIRs and negative declarations consistent with CEQA. In short, these revisions seek to improve the roadmap for lead agencies to follow." In late December, the Wilson administration made one final change when it exempted five-acre infill projects from CEQA review — with some exceptions. The New Checklist Among the most notable changes for planners who do daily CEQA work is a new checklist, which is generally receiving a favorable response from practitioners. "Those who have used it report that it is vastly superior to the old checklist," said Al Herson, president of Jones & Stokes Associates. With more detailed questions that reflect updated environmental laws, the checklist helps planners better determine a project's potential significant impacts, he said. The checklist, which is Appendix G, also is better organized and integrates the former Appendix G, which listed "impacts considered significant," he said. Curtis Alling, vice president of EDAW, Inc. in Sacramento, agreed the new checklist is an improvement. However, he noted, the more detailed questions take time to answer. "For the very simple projects — the ones that are clearly a negative declaration, and not even a mitigated negative declaration — it's taking longer to process," said Alling, who is also chairman of the Association of Environmental Professionals legislative review committee. Setting Thresholds While many counties have established thresholds for determining the significance of a project's impacts, many cities have not. Developers complain that the lack of clearly identified standards creates uncertainties. The new guidelines (§ 15064.7) encourage cities and counties to establish thresholds of significance. Many thresholds can be adapted from state standards, but in some instances a local jurisdiction may want to set its own standards for impacts in areas such as noise and circulation. "There are probably more jurisdictions establishing local thresholds than there were before the revisions to the CEQA guidelines," Herson said. The guidelines further recommend an agency conduct a public process for adopting thresholds of significance. Some planners and environmentalists contend that established thresholds intrude on the "fair argument" test. Under this standard, an EIR must be prepared if someone can make a fair argument that a project may create significant environmental impacts. Some people worry it could be more difficult to make a fair argument if a project falls below established thresholds, especially if thresholds allow for considerable change in the environment. "I think it's going to require a court case to decide it," said Alling, who shares this concern and would like to see the guidelines better reflect case law. "There is a presumption that if an impact doesn't meet the standard, it's not significant." But planners should be careful when making that presumption, he warned. "My advice to clients is that fair argument is law, and these are only guidelines." The Baseline Is Now … Sometimes The revisions say the baseline physical conditions for environmental study are those that exist "at the time the notice of preparation is published, or, if no notice of preparation is published, at the time environmental analysis is commenced" (§ 15125). But confusion begins with the next sentence, which says, in part, "this environmental setting will normally constitute the baseline …" Alling said the AEP insisted on the word "normally" because sometimes the point of the notice of preparation is not useful. For instance, in reviewing projects that may impact rivers, the best baseline data about the river may come from a series of previous years, he said. The revision was intended to get local planners thinking about — and explaining — the baseline, said Herson, who testified on the guidelines for the California Chapter of the American Planning Association. Planners may legitimately use a different baseline than the time of the notice of preparation, but they must carefully document why, Herson said. For example, if planners know infrastructure that is acceptable now will be at capacity when project construction begins, they should use the future condition as a baseline, he said. Possibly a larger point of confusion concerns cumulative impacts, Herson said. Revisions were supposed to streamline the process for determining cumulative impacts. Instead, the guidelines created too many options for analyzing cumulative impacts, he said. Solving this confusion will require more experience, case studies and professional education, he suggested. Smart Growth Meets NIMBY? The watered-down language decried by Gorsen, the former Resources Agency attorney, affects a change backed by some "smart-growth" advocates. In late December, the Wilson Administration added a guideline (§ 15332) that exempts infill projects of five acres or less from CEQA review. However, the exemption applies only to projects that "would not result in any significant effects relating to traffic, noise, air quality or water quality." In other words, planners must complete a miniature environmental study to determine if a project qualifies for an exemption. The first iteration of the exemption was quite broad but received strong criticism from planning and environmental organizations, Gorsen recalled. "By the end, what we adopted was symbolic — we think infill is a good idea," she said. "To us, it was very disappointing." She added, "To do a real infill exemption, you would need to do a legislative change because you can't exempt something with significant environmental impacts." While the planning community waits for someone to test the new infill exemption, there are rumblings from environmental justice advocates. They say the measure does not afford urban residents who live next to infill sites the same level of protection as people who reside next to greenfields. No Revolution It remains too early to see all of the fallout from the guideline. While interest in learning about the changes is high among planners, most jurisdictions appear to be following the same pattern as before the state published the revisions. In Santa Barbara County, for example, environmental review is quite rigorous and will continue to be, said Dan Gira, a planner in the long-term planning division. "I don't think it has had a significant impact on how the county does business," he said. Contacts: Al Herson, president, Jones & Stokes Associates, (916) 737-3000. Curtis Alling, vice president EDAW, Inc., (916) 362-3606. Maureen Gorsen, McClintock, Weston, Benshoof, Rochefort, Rubalcava & MacCuish, (213) 623-2322. Patrick Wright, deputy secretary, Resources Agency, (916) 653-5672. Guidelines online: http://ceres.ca.gov/ceqa

They come with Spandex and attitude. And they come with an agenda no less ambitious than to change urban transportation. They are adherents to the merry prankster of grassroots planning movements — Critical Mass. Massers have a simple modus operandi: (1) organize mass bicycle rides once a month, (2) ride through the city, sharing travel lanes with cars, (3) demonstrate that bicyclists have road rights, too. Like other anarchist-oriented movements, Critical Mass boasts no central organizational structure. Instead, Massers publicize, organize, and communicate through Web sites and coffeehouse fliers. As planning street theatre, it's great stuff. The bigger question is, will Massers change transportation policy? As a movement, Critical Mass is growing. What began with 45 riders in San Francisco's Financial District in 1992 has mushroomed into a global grassroots pressure group challenging the car's domination of public rights-of-way. According to the "unofficial" web-site, 155 monthly rides occur in cities around the world — 61 of them in North America. California has its fair share, including documented groups in Arcata, Santa Rosa, Sacramento, Walnut Creek, Berkeley, Marin County, San Francisco, Silicon Valley, Santa Cruz, Fresno, San Luis Obispo, Ventura, and Los Angeles. The San Francisco monthly ride boasts 5,000 participants, though other rides are markedly smaller. So far, results are inconclusive on the policy-change question. Whereas Critical Mass rides may demonstrate how the wheels of progress ought to spin smoothly, their effectiveness with policymakers has yet to be demonstrated. With unofficial Internet-published goals including "creating a car-free space in the center of our cities," and "enjoying the great outdoors," Massers provide municipalists no clear entity with which to tango. Because Critical Mass is frustratingly difficult for policy makers to deal with, police departments and the news media take up the task. This leads to the public relations black-eye suffered during San Francisco's July 1997 ride. During that event, more than 5,000 cyclists fanned out well beyond the bounds of the route brokered by the San Francisco Bicycle Coalition and the city. Police arrested 250 cyclists, mainly for traffic violations and illegal assembly. Authorities eventually dropped all charges, but such run-ins with local police may be inevitable for an urban movement that materializes with little notice and confronts the transportation status quo. At least one of Critical Mass's founders, Chris Carlsson, eschews any further negotiated settlements with municipalists. Says Carlsson, "Critical Mass is one of the most political events of this depressing decade … it has no further purpose than its continued existence, which in itself is an affirmation of communities that are otherwise invisible and easily ignored." More policy-oriented Critical Mass sympathizers have recognized the need to be more visible, and have taken a more conventional tack. Leah Shahum, of the San Francisco Bicycle Coalition, calls her group "the yin to the Critical Mass yang." In 1998, the SFBC swallowed a disappointing setback when it failed to convince the Parking and Traffic Commission to adopt a full package of street enhancements needed to complete a proposed bicycle network in the City. But Shahum asserts progress is being made. "Two years ago, politicians did not even have bicyclists on their radar. Now they do," she says. Physical progress is also becoming evident. The SFBC recently prodded the City to implement a green arrow program for San Francisco streets. Painted symbols, illustrating a bicycle inside a bright green arrow, remind drivers to share the city's narrow roadways with cyclists. The program will eventually cover nearly 60 miles of the street system. Statewide cyclists efforts have begun to make some policy progress as well. In October 1997, the California Bike Coalition succeeded in its efforts to get AB 1020 passed. The bill increased 13-fold the amount of money Caltrans allocates to bicycle facilities statewide, from $360,000 to $5 million annually through 2004. Despite the paucity of demonstrable policy accomplishments, Massers have struck a nerve. In forcing the revamping the urban transportation discussion, they have even stolen the fire from transportation agencies' numerous alternative mobility efforts. Indeed, some of these government-sponsored efforts seem to be watered-down copies of the original. Is it any coincidence that California's Bike-to-Work Week, which recently completed its fifth edition, is two years younger than Critical Mass? The annual event is endorsed by Caltrans and sponsored by a host of the state's regional COGs. It seems only fair to ask, is the annual bike commute event merely Critical Mass in public agency clothing? Stephen Svete, AICP, is a principal in the Ventura-based consulting firm of Rincon Consultants Inc.

The Fourth District Court of Appeal has overturned a trial judge's ruling that environmental review of the proposed Eagle Mountain landfill in Riverside County was inadequate. The additional review was conducted under a court order that found fault with the previous environmental work on the project. The Eagle Mountain project would convert a former Kaiser Steel iron-ore mine into a landfill of 2,200 acres with the capacity of accepting up to 20,000 tons of waste per day for more than a century. However, it would be located within 1.5 miles of Joshua Tree National Park — a fact that has galvanized project opponents, including the National Parks and Conservation Association. The current case emerged from challenges to a new environmental impact report prepared by Riverside County in response to a previous court challenge on the project. The National Parks and Conservation Association and landfill opponents sued the county. In 1994, San Diego Superior Court Judge Judith McConnell, who handles many challenges under the California Environmental Quality Act from surrounding counties, ordered a new environmental impact report. Among other things, she said, the EIR should have spent more time describing the cumulative impact of the project and wrongly dismissed a possible hydroelectric project associated with the landfill as remote and speculative. She also ruled that the evidence was insufficient to support the EIR's conclusions regarding the desert tortoise habitat and the proximity to Joshua Tree National Park. Proponents appealed McConnell's ruling, but the Fourth District upheld her decision in 1996. (National Parks & Conservation Assn. v. County of Riverside, 42 Cal.App.4th 1505 (1996); CP&DR Legal Digest, April 1996.) Between 1994 and 1997, the county re-examined many environmental issues and eventually produced an entirely new EIR. The Board of Supervisors then issued a decision that the project, as mitigated, would have only one significant impact — an adverse impact on the "wilderness experience" — and issued a statement of overriding considerations in approving the project. However, opponents challenged the adequacy of the new EIR and eventually won another favorable ruling from Judge McConnell. This time, McConnell ruled that the county had not complied with her earlier order to adequately examine the impact on both the wilderness experience and the desert tortoise population at the park. On appeal, the county and the project proponents, Kaiser Steel Resource and Mine Reclamation Corp., argued that substantial evidence supports the county's decision to approve the project. The Fourth District, Division One, agreed with the county and overturned Judge McConnell's ruling. One of the complicating factors in the EIR was the fact that the 1994 California Desert Protection Act upgraded Joshua Tree from a National Monument to a National Park. Interpretation of this change had a major impact on both Judge McConnell and the appellate court, especially with regard to the "wilderness experience" portion of the environmental analysis. For example, the appellate court noted that when the Desert Protection Act was passed, Senator Dianne Feinstein, D-California, the legislation's main sponsor, wrote a letter to Interior Secretary Bruce Babbitt stating that she never intended this action to dictate the creation of a private "buffer zone" around the park. It was in this context that the appellate court examined the wilderness experience analysis. This issue came into play in the appellate court's discussion of the noise analysis. According to the county, the project's opponents were demanding, in effect, a "zero impact" standard inside the park for noise and other impacts. In the absence of National Park or federal noise standards that could be applied, the EIR used the county's residential noise standards, which sets 65 decibels as the level of significance. "There is no authority to create a private de facto buffer zone around the Park for the purposes of land use," the court wrote. "Absent more closely applicable standards, it appears that the county had a substantial basis for accepting the EIR's use of county residential noise standards for assessing noise impacts. There is no requirement that all noise from the project be mitigated to a level of inaudibility, particularly as to nonwilderness parklands." Similarly, on the issue of the wilderness experience to park visitors, the court disagreed with Judge McConnell and found the EIR's discussion adequate. Noting that it is difficult to measure these impacts well, the court said: "The EIR acknowledges the potential subjective impacts of the project, even though it does not go much farther in defining them; however, its analysis goes the extra mile in examining every possible sensory impact on a Park visitor." Regarding the impact on the desert tortoise, the court took Judge McConnell to task. She found a lack of substantial evidence to prove that the impact on the tortoise — an endangered species — had been mitigated to a level of insignificance, and in particular questioned why the county did not require the project to fence the 52-mile railroad line through the project. According to the appellate court, the U.S. Fish & Wildlife Service examined this option and determined more study was needed. "On balance," the court said, "it appears that the trial court effectively substituted its judgment on the fencing issue for those of the expert agencies and biologists in the field. It had no adequate basis for doing so." The court also rejected Judge McConnell's judgment that landfills are not permitted in the tortoise areas under the federal Desert Tortoise Recovery Plan. The Case: National Parks and Conservation Association v. County of Riverside, No. D031056, 1999 Daily Journal D.A.R. 4309, 99 C.D.O.S. 3395 (issued May 7, 1999). The Lawyers: For National Parks and Conservation Association and other plaintiffs: Floy E. Andrews, Gibson, Dunn & Crutcher, (213) 229-7206. For Riverside County and other defendants: Michael H. Fish, Nugent & Newnham, (619) 236-1323.

When taking real estate by eminent domain, a public agency must pay the landowner for the value of unmined aggregate on the property, the Second District Court of Appeals has ruled. The unanimous three-judge panel ordered the Ventura County Flood Control District to pay owners of 67 acres $2.6 million to compensate for the owners' loss of the aggregate resource. The value of mineral deposits, including sand, clay and gravel, is an element in determining fair market value, which the public agency is required to pay when condemning land, the court said. "Knowledgeable buyers and sellers would not ignore the valuable aggregate any more than they would a gold, diamond or basalt mine," wrote Justice E. Jeffrey Burke, a San Luis Obispo County Superior Court judge temporarily assigned to the Second Appellate District, Division Six. "The value of the aggregate is neither driven by the project nor is it the project, as suggested by District. … As the trial court found, District hoped to pay for the project with royalties it would obtain from the aggregate." The district in 1995 hired Southern Pacific Milling to excavate a basin that would intercept floodwater on the Grubb Ranch, which was owned jointly by Daniel Campbell and James Alger. Under the contract, SP Milling would pay the district $1.3 million for the aggregate from the ranch, located along the Santa Clara River near Oxnard. However, when that SP Milling contract lapsed, Campbell, who owns Truestone Concrete Products, sought to mine the aggregate. County planners said he would need an environmental impact report before getting a permit to mine. The district in November 1995 offered to buy portions of the ranch for $35,000 an acre. Campbell rejected the offer, and the district soon adopted a revised initial study and negative declaration reflecting its plans to obtain the entire ranch. Campbell sought a writ of mandate challenging the project's lack of an EIR, but he lost in Ventura County Superior Court. The district proceeded with its eminent domain action and, after the district deposited $2.4 million, the court on April 8, 1996, ordered possession to the district. Campbell then sued Alger and the district, asserting his right of first refusal to purchase the property. Campbell lost that suit in Superior Court and, in an opinion handed down the same day as the valuation suit, Campbell lost the appeal in the Second District. In October 1996, Alger accepted a stipulated settlement from the district for $1.2 million. Just before Alger accepted the purchase offer, Campbell filed suit seeking declaratory and injunctive relief, and asserting violations of civil rights and unjust enrichment. The trial court rejected all of Campbell's arguments except those regarding unjust enrichment. A jury set the fair market value of the ranch at $5.2 million, awarding $2.6 million to Campbell, plus $150,000 in legal fees. The district appealed the jury's verdict, and Campbell appealed the amount of legal fees. The Flood Control District said the trial court erred by permitting evidence regarding the hypothetical market for aggregate. The land's value should have been based on its agricultural use, the district argued. Furthermore, the district contended the enhanced property value was attributable to the project. In upholding the ruling by Ventura County Superior Court Judge William L. Peck, the appellate court said allowing evidence of an active aggregate market in a rapidly developing area was correct. In fact, the district had solicited proposals to excavate Grubb Ranch and accepted a bid from CalMat Co. for $3 per cubic yard, enough to generate $5 million for the district. "The open bids by SP Milling and CalMat, private building materials companies, establish an existing market for scarce aggregate in the community. The fact that the aggregate was extracted to provide a basin for the flood control project does not change its intrinsic value to the private sector for building material," the court said. The court added, "We admonish district not to suggest to juries, as it did here, that is should consider the liability of taxpayers in valuing the condemned property." The appellate court rejected Campbell's request to recover more legal costs and his civil rights claims. The district may legitimately pursue a project that intercepts floods, protects high groundwater and conserves farmland, the court said. As for Campbell's separate suit regarding his right of first refusal, the appellate court said,"The Legislature has provided that if a public entity is forced into eminent domain litigation, it should settle with as many owners as swiftly as possible to minimize the costs, uncertainties and time to obtain such needed land. Private holders of rights of first refusal may not thwart such public purposes by forcing the owner or the subsequent public entity to sell it to them. (Gov. Code §7267.2; Melamed v. City of Long Beach (1993 15 Cal.App.4th 70, 81-83.)" The Cases: Ventura County Flood Control District v. Campbell, No. B117274, 99 C.D.O.S. 2610, Daily Journal D.A.R. 3347, and Campbell v. Alger, No. B115217, 99 C.D.O.S. 2599, Daily Journal D.A.R. 3333, filed April 7, 1999. The Lawyers: For the Flood Control District and Alger: James L. McBride, Ventura County Counsel, (805) 654-2580. For Campbell: M. Reed Hunter, Crosby, Heafey, Roach & May, (213) 896-6000.

The U.S. Environmental Protection Agency's Brownfields redevelopment program is geared toward inner cities, but state officials would like to bring Brownfields aid to rural areas where timber mills have closed. For more than 100 years, timber companies erected sawmills all over northern and central California. However, as nature and government regulators restricted the timber supply, many of those sawmills closed, leaving a huge hole in the economy of the rural towns that grew up around the mills. The state Trade and Commerce Agency's Mill Reuse Pilot Program is intended to turn about six of those idled mill sites into new industrial centers. A $200,000 Brownfields grant from U.S. Environmental Protection Agency is funding is the pilot program. Trade and Commerce Agency analysts identified more than 100 closed mill sites in the central and north state. They received 10 applications for pilot program grants, project manager Karen Homolac said. The grants will pay for phase one and, if necessary, phase two environmental assessments of five or six mill sites, depending on study expense. The agency also will help the communities involved undertake a visioning program for the mill sites, which are often the only industrially zoned parcels in the area, Homolac said. Business boosters, local officials and landowners in rural areas often know little about the EPA's program, Homolac said. "People just have to get educated about what Brownfields are. People don't understand the legislation. Many of these properties just stay fenced up," she said. "This recognizes that Brownfields can be rural, not just urban." A sawmill closure can devastate a small town. Not only are good-paying sawmill jobs lost, but work for tree fallers, truck drivers and those who serve the sawmill also decreases. Transforming an old mill site into a center of new industry takes years. When South Fork Timber Industries in 1994 closed its sawmill in the unincorporated Madera County community of North Fork, it surprised no one. The mill employed up to 120 people at its peak but the work force dwindled to 45 by the time of closure. Area residents two years earlier began forming what would become the North Fork Community Development Council, said Barry Vesser, the agency's director. Since its formation, the council convinced South Fork Timber to donate the 135-acre site to the Madera County Redevelopment Agency in exchange for tax credits. The council enticed the EPA to perform environmental assessments and the council lined up grants to pay for a master plan and accompanying environmental impact report. The EIR is nearly complete, Vesser said. Once it is finished, the redevelopment agency will give the land to the council, which will be in charge of redevelopment. The master plan calls for 60 percent of the site to be used for light industrial businesses, 30 percent for a recreational vehicle park and 10 percent for a community park. Significant local interest exists for investment in the RV park, but enticing companies to build in the light industrial area could be a difficult marketing effort, Vesser said. Also, pollution from the former mill's log dip tank is a factor and no one knows how much cleanup will cost, he added. The council is considering a land swap with a developer who would remediate the contamination. "These sites are an asset, but like a lot of assets, they have liabilities attached to them," he said. Pollution usually impacts only a portion of a former mill site, said Sandy Karinen of the Department of Toxic Substances Control. Problems often stem from dip tanks in which logs were treated with a chemical solution to prevent mildew, she said. "For the most part, it's not nearly as expensive a problem with a saw mill as with a pressure-treating facility or a pulp mill, where a lot of chemicals are involved," she said. However, pollution is but one of many obstacles on the road to sawmill reuse. Patience may be the most vital asset for anyone wanting to redevelop an old mill site, said Hanan Bowman, project manager for Oregon's Mill Site Conversion Project, on which California's pilot program is based. After four years of work by the project, six of the twelve targeted sites are moving toward redevelopment, Bowman said. "The timeline for each site is a lot longer than anyone anticipated," said Bowman, who works for the private, nonprofit Rural Development Initiatives. Finding cooperative landowners, assessing environmental damage, planning, and attracting development funding all take time, he said. Because the federal Brownfields program is geared toward urban areas, efforts to get money for rural projects take longer, he said. Redeveloping one old mill site costs $2 million to $4 million, Bowman added. Contamination cleanup alone can cost anywhere from $250,000 to $1.5 million, he estimated. Soft costs, such as money spent for accountants and attorneys, also can eat up hundreds of thousands of dollars, he said. "The question is where is the money going to be coming from. And it's a question we have not solved," Bowman said. Homolac acknowledged these downsides and recognized the long-term commitment that mill site reuse requires. The state wants to draw the public into the process because many locals oppose, or are at least skeptical of, mill redevelopment, she said. North Fork's Vesser agreed that eliciting community support for planning mill site reuse is important because the sites often are large, visible, near the center of town and zoned for industry. Maintaining community interest while discarding pie in the sky notions is critical, he said. Getting the public involved "costs you some time and costs you some money, but it's time and money well-spent. Considering these are not quick processes, you can plug that in pretty economically," Vesser said. Bowman, of the Oregon program, recommended program managers set short-term goals so citizens and landowners remain motivated. Program backers believe revitalizing old mill sites is essential to keep alive the small towns that grew up around the mills. Big Fork is a perfect example of a foothill town that needs a new industrial base. The largest employers now are the local school district and the U.S. Forest Service, Vesser said. Many Big Fork residents must commute to jobs in Fresno (an hour away) or Oakhurst (30 minutes away). Trade and Commerce Agency officials intend to pick five or six mill sites for the pilot program by early June. Contacts: Karen Homolac, California Trade and Commerce Agency, (916) 324-8656. Hanan Bowman, Oregon Mill Site Conversion Project, (541) 684-9077. Barry Vesser, North Fork Community Development Council, (559) 877-2244. Mill Reuse Pilot Program, www.commerece.ca.gov/millreuse.