The federal government's review of potential impacts of a new public clubhouse at the Presidio Golf Course was adequate under both federal environmental and historic preservation laws, the Ninth U.S. Circuit Court of Appeals has ruled. The federal analysis had been challenged by the Presidio Golf Club, a century-old private golf club which owns an historic clubhouse adjacent to the Presidio. A predecessor to the Presidio Golf Club built the golf course on the grounds of the Presidio in 1895, as well as a private clubhouse on land adjacent to the Presidio. For many years, military officers were permitted to join the club at discounted rates and use its facilities, but in the 1950s the Army built its own clubhouse facilities on Presidio land near the private clubhouse. Military personnel and Presidio Golf Club members enjoyed exclusive use of the golf course until the Presidio was de-commissioned in 1994. After the Presidio was transferred to the National Park Service in 1995, the Park Service contracted with Arnold Palmer Golf Management Co. to manage the course and open it to the public. Among other things, Presidio Golf Club members lost their preferential tee times, which apparently reduced the value of club membership. In 1996, the Park Service issued an environmental assessment on a proposal to demolish the Army golf course facilities and replace them with a new 6,000-square-foot public clubhouse. The Presidio Golf Club sued, claiming that that the EA did not adequately consider the potential impact of the new public clubhouse on the old private clubhouse, and that the Park Service did not comply with the National Historic Preservation Act by failing to consider whether the construction of the new clubhouse would lead to neglect and destruction of the old private clubhouse. The club's lawyers asserted that the club had already lost half of its membership because of the new public use rules and that the club's ability to remain financially viable is questionable. While conceding that the old private clubhouse is eligible for inclusion on the National Register of Historic Places, the Ninth Circuit concluded that analysis of environmental impact and impact on historic resources was adequate. In a lengthy section of the opinion, the three-judge panel concluded that Presidio Golf Club does have standing to bring the lawsuit because "while it is a close question, the injury asserted by the Club is fairly traceable to the building of the public clubhouse," and because the club's interest is "arguably within the zone of interests to be protected under NEPA and NHPA". However, the court found the federal government's environmental assessment to be adequate. Among other things, the club argued that the EA was inadequate because it did not consider the possibility of cooperative use of the old clubhouse. The Ninth Circuit bought the Park Service's argument that the private clubhouse would likely be too small to accommodate additional demand and also noted that the because the club had long expressed a wish to remain private the Park Service could reasonably expect that the club would not be receptive to cooperative use. The Ninth Circuit also rejected a long series of complaints by the club claiming that the EA was inadequate, including the allegation that the Park Service failed to take into account "reasonably foreseeable effects" of the new clubhouse. The EA noted that the new clubhouse would not compete with the old clubhouse because "it would not duplicate the private PGC clubhouse in function. Indeed, its function would be the polar opposite" - meaning it would be public rather than private. Concluded the Ninth Circuit: "While we have found an adequate string of causation necessary to confer standing, it does not necessarily follow that such a highly attenuated chain of causation as the Club alleges would lead to injuries cognizable under NEPA." Regarding NHPA, the court concluded that the Park Service was required to take the views of interested parties into account but nothing more. Thus, the court accepted as adequate the Park Service's conclusion that because the two clubhouses would not compete the historic clubhouse would not be endangered. The Case: Presidio Golf Course v. National Park Service, No. 97-16703, 98 Daily Journal D.A.R. 10104 (filed September 21, 1998). The Lawyers: Nicholas C. Yost, Sonnenschein, Nash & Rosenthal, (415) 882-2440. Ronald M. Spritzer, U.S. Department of Justice, Washington, D.C.

In the latest skirmish in a longrunning battle, an appellate court has overturned a trial judge's decision to strike down the City of Watsonville's decision to "pre-zone" and annex 216 acres of land in a disputed agricultural and coastal area west of Highway 1. If it is eventually published, the court ruling could be an important step in establishing the credibility of "tiered" environmental impact reports. The unpublished ruling by the Sixth District Court of Appeal in San Jose gives Watsonville a leg up - at least for now - over environmentalists who are seeking to stop the city from expanding across Highway 1 toward the coast. The so-called Riverside property, which would be the site of a new industrial park, is one of two parcels west of Highway 1 that the city is seeking to promote for development. The city is also promoting residential development on the 600-acre Tai property nearby, while environmentalists are also disputing a decision by the Pajaro Unified School District to locate a new high school in the same area. (See CP&DR Local Watch, December 1997, and CP&DR School Watch, August 1997.) In the court case, the Sixth District overturned a trial judge's ruling that Watsonville could not "tier" its environmental review based on the city's previously existing general plan environmental impact report. "It would be unfortunate if agencies abandoned the use of program EIRs when adopting or amending general plans in anticipation of carrying out a later series of activities pursuant to the plan or plan amendments," the court wrote. "The program EIR is tailor-made for such situations ... Accordingly, we hold that a program EIR could be and was used as the General Plan EIR in this case." Watsonville "pre-zoned" the Riverside property and adjacent property west of Highway 1 for industrial development in August of 1996. The city issued a draft EIR for the Tai property, but concluded that it could rely on the general plan EIR for the Riverside property. Although the general plan had not taken account of potential development of the Tai property, it did contemplate industrial development of the Riverside property. The city then pursued annexation, but was caught up in a major dispute at the Santa Cruz County Local Agency Formation Commission. In late 1997, the LAFCO laid down strict rules by which Watsonville could annex property and added part of the Riverside property to the city's sphere of influence. Meanwhile, however, local environmentalists sued Watsonville over the pre-zoning, arguing that the city had not addressed the environmental impacts of the decision. Among other things, the environmentalists argued that an SEIR should have been done for the Riverside property and also claimed that the city's environmental review did not cover all the environmental impacts, especially the cumulative impact when combined with the Tai project. The trial judge ruled in favor of the environmentalists, ordering the city to withdraw certification of environmental review and approval of the prezoning until the city examined the environmental impact of annexing property in the area. The city rescinded the prezoning and annexation, certified the final supplemental EIR, and then approved the prezoning and annexation again. The environmentalists claimed these actions rendered the appeal moot but the appellate court disagreed and ordered that the appeal move forward. On appeal, the city asked the appellate court to overturn the trial judge's ruling by arguing that the city did appropriately rely on the general plan EIR in prezoning and seeking annexation for the Riverside property - even though the general plan EIR had not contemplated development of the Tai property. The environmentalists continued to argue that development of the Tai property altered the overall development pattern of the area in a way that was not contemplated by the general plan EIR, and this altered impact should have been taken into account in the environmental analysis for the Riverside Drive prezoning and annexation. The appellate court agreed with the city. The environmental analysis on the Riverside property, the court said, "concluded that the General Plan EIR had previously identified the loss of agricultural land as the only significant and unavoidable impact of implementing the General Plan. Since the study revealed no new information that would alter the EIR's conclusions, the EIR adequately evaluated the anticipated annexation of the Riverside Drive site." The appellate court also concluded that, if development of the Tai property had cumulative environmental impacts, they should have been addressed in the city's supplemental EIR for inclusion of the Tai property inside the city's sphere of influence. "It had no effect on the prezoning and annexation of the Riverside Drive site, an impact considered in the General Plan EIR," the court wrote. To continue to create new environmental documents with every altered situation, the court added, "would produce a never-ending cycle of redundant EIRs anytime a city wished to issue an SEIR." The appellate court also reversed the trial judge's decision because the environmentalists had not raised all issues during administrative hearings, and because the appellate court found "substantial evidence" that all potential impacts of development on the Riverside Drive site were raised in the general plan EIR. Perhaps most important, the appellate court concluded that the general plan EIR was, in fact a "program" EIR and therefore the city appropriately used "tiering" for environmental analysis on the Riverside Drive site. The environmentalists argued that the general plan EIR was a "first-tier EIR" - thus implicitly requiring a second-tier EIR at the project level - because a general plan EIR is mandatory under the CEQA Guidelines, whereas a program EIR is optional. The court disagreed. The Case: South County Coalition for Intelligent Planning v. City of Watsonville, No. H016569 (unpublished Sixth District, issued September 17, 1998). The Lawyers: For South County Coalition: For City of Watsonville: Steve Kostka, McCutchen Doyle, (510) 937-8000.

Santa Barbara County and its consultants had no duty to prepare an environmental impact report that was acceptable to a developer, an appellate court has ruled. A three-judge panel of the Second Appellate District, Division Six, unanimously turned down a challenge from the developer of Mission Oaks, a 3,877-acre residential project proposed near Buellton. The project called for 31 homes to be built on separate 100-acre parcels, with most of the land to remain in agricultural use for cattle grazing. A draft EIR had been prepared for the county by Envicom Corporation of Agoura Hills and other consultants. The draft EIR found, according to the opinion by Presiding Justice Steven Stone, "a multitude of significant, adverse, and unmitigable impacts." The developer of Mission Oaks, Stone wrote, "opines that the preparation of the DEIR was a sham, and that the conclusions in the DEIR are false." The developer hired its own consultant, who concluded there was no substantial evidence to support the DEIR's findings and conclusions. The Mission Oaks project was rejected by both the county's planning commission and its board of supervisors in 1995. A separate mandamus lawsuit was filed. The county won on the mandamus issue, although no ruling has been made yet on a cause of action in that case involving a taking issue. Mission Oaks, according to the appellate opinion, alleged that the county wanted to prevent development and generate excessive fees, so the county "falsely encouraged Mission Oaks to proceed with the EIR while knowingly having no intention of ever approving or recommending approval of the Project." Most of the Mission Oaks lawsuit that was the subject of the appeal was rejected at the Superior Court level, except for one Williamson Act claim that was later dropped. The appellate panel said that the suit was untimely, because it was not brought within the deadlines set for such actions. Statements at issue in the case are privileged under Civil Code Section 47, which prevents tort claims for preparation of an EIR, the court said. Additionally, the court said that the case was subject to Section 425.16 of the Code of Civil Procedure, the anti-SLAPP statute. The appellate court opinion said the only issue remaining was a breach of contract claim - that the EIR was not prepared under the requirements of CEQA and the fees charged to the developer were unreasonable. The county owed no duty to provide an EIR acceptable to Mission Oaks, according to Justice Stone's opinion, which was joined by Justices Arthur Gilbert and Kenneth Yegan. The fee agreement between the county and developer showed that the county had the sole discretion to determine the adequacy of the performance of the EIR consultant and the extent of payment. "The County owes no duty to assuage the desires of the potential developer," the court said. "The County did not abuse its discretion under the instant contracts or its duty under CEQA as to any of the consultant defendants or otherwise." Mission Oaks also argued that because the county was a third-party creditor beneficiary of the contract with EIR consultants, it owed Mission Oaks a duty to comply with CEQA. But the court said that the language of the county's contract with Envicom said Envicom's responsibility was to provide "a complete and accurate EIR" solely to the County, not to Mission Oaks " or to any other third-person or entity." "CEQA is designed to protect the public," the opinion said. "If courts permitted lawsuits against environmental consultants by project proponents regarding the findings stated in their reports, the independence of the professional experts and the objectivity of their specialized findings and conclusions would be undermined and jeopardized by fear of retaliatory action." The court also granted attorneys' fees to the county under the anti-SLAPP law. This is believed to be the first time a court has granted attorneys' fees to a local agency under the law. "Disgruntled developers should not be permitted to frivolously tie up the resources of government agencies and the judiciary by suing for damages over the denial of their map and permit applications," Justice Stone wrote. Mission Oaks attorney Kenneth S. Meyers said the appellate court opinion "grossly misstates Mission Oaks' position regarding what our claim was." One caption in the opinion, Meyers noted, read "County Owes No Duty to Provide EIR Acceptable to Mission Oaks." "We've never contended that the county had that duty," Meyers said. "Rather, our contention is that the county's duty was to cause the preparation of an EIR which complied with the objective standards of CEQA." Mission Oaks has filed a petition for review with the California Supreme Court. The Case: Mission Oaks Ranch, Ltd. v. County of Santa Barbara, No. B108463, 98 Daily Journal D.A.R. 7903 (issued June 18, 1998). The Lawyers: For Mission Oaks: Kenneth S. Meyers, Alschuler, Grossman & Pines, (310) 551-9142. For Santa Barbara County: Shane Stark, County Counsel, (805) 568-2950. For Envicom Corporation: Jan Chilton, Severson & Werson, (415) 398-3344.

McClellan Air Force Base near Sacramento appears likely to make a strong transition to private industrial use. Sacramento County has decided to purchase some 2,400 acres - about two-thirds of the base - for $90 million, or almost $40,000 per acre. At the same time, Lockheed Martin Corporation has submitted a bid for a giant Air Force contract that would employ thousands of people on the industrial part of the property that the county plans to buy. McClellan is scheduled to close in 2001. The county will purchase the airfield and the base's industrial area, which are considered its prime assets. Under the conveyance agreement, the county would make no payment for the first 10 years, and would subsequently pay $3 million for 30 years. The arrangement has been hailed as a bargain by local base reuse officials, who had negotiated for the $90 million amount for several years, according to base reuse spokeswoman Jill Estroff. (Last year, in fact, President Clinton promised that the federal government would sell McClellan to the county "at a significantly reduced price.") In December 1997, however, the Pentagon complicated negotiations by demanding an additional $25 million. The government later backed down on that demand, however. Sacramento lawyer Randall Yim led the negotiating team for the county, which is the designated local reuse agency. Yim was recently named Principal Deputy Assistant to the Secretary of the Army. McClellan is one of a handful of bases nationally that are undergoing a process known as "privatization." In this process, the Pentagon transfers the industrial functions or "workloads" at the base to private companies. Making a play for what is likely the largest single workload at the base, Lockheed Martin and AAI Engineering Support Incorporated submitted a bid for a variety of aircraft-maintenance tasks that are currently performed by 2,300 non-military workers at the base; the work is valued at $220 million a year. Hill Army Depot in Ogden, Utah, is competing for the same workload; Boeing is bidding on behalf of that base. A decision was originally expected in late September, but has been delayed, while the Pentagon evaluates a challenge from Precision Standard Inc. (Pemco), a Colorado-based aircraft-maintenance firm, which has questioned the legality of creating a giant workload that goes to a giant defense contractor in a winner-take-all contest. The Pentagon is currently in the midst of a 100-day adjudication process, scheduled to end September 25, on the Pemco matter. If Pemco prevails, it is conceivable that the giant workloads would be "unbundled" into smaller workloads, which would be the subject of competition for a larger number of companies. The decision is crucial to the future of McClellan: Lockheed and a second company, Euro United Corporation, a Canadian plastic company, would occupy much of the portion of McClellan that the county plans to buy. If Lockheed wins the bid, the two companies together are expected to employ between 5,000 and 6,000 people, according to county officials. Notwithstanding the uncertainties of the Lockheed bid, McClellan has a promising future as commercial real estate in a region that is running low on industrial land, according to Neil Smyth, managing director of CB Richard Ellis' Sacramento office. The base is "very well located on the I-80 corridor, and that whole corridor is a very good location" for warehousing and distribution. The local industrial market, which includes Sacramento County and portions of Placer, El Dorado and Yolo counties, currently has a very low vacancy rate of 4.8% out of a base of 130 million square feet, according to CB Richard Ellis.

A settlement has been reached in lawsuits between Sacramento County and the city of Citrus Heights over costs to be paid by the new city related to its incorporation. Citrus Heights incorporated in January 1997, and before incorporation had agreed to pay the county $5.6 million in installments for 25 years. That amount was the county's "profit" from taxes after paying for all services in the area during the period Citrus Heights was unincorporated. The new city was to pay a projected total of $140 million over 25 years (see CP&DR, April 1998). Under the terms of the settlement, Citrus Heights is to pay $2.2 million the first year, and a projected $80 million over the next 25 years. The money will come from property tax revenues. Since property tax revenue is first paid to the county, the money cannot be held up by the city. "Essentially, the city is giving up its property taxes," said Ruthann Ziegler, the city's attorney. The original $5.6 million figure was based on expected tax revenues from Sunrise Mall, which is no longer doing as well. New shopping areas outside the city limits are drawing shoppers away from the mall, and more competition from other shopping centers is expected. A Local Agency Formation Commission official who prepared the calculation later admitted it was wrong. A county analysis done in 1997 found that the correct figure should have been $5.1 million, said county supervisor Roger Dickinson. Citrus Heights officials refused to make the first payment after incorporation, and the county sued in November 1997. The city then countersued. Dickinson cast the lone vote on the Sacramento County Board of Supervisors against the settlement. He said it would set a bad precedent for negotiating with other areas of the county that want to incorporate. Almost two-thirds of the county's 1 million residents live in unincorporated areas. Dickinson also said that the settlement wasn't fair since Citrus Heights wasn't paying what it should. "People in Citrus Heights get an enhanced level of municipal services while other people in the county get a decline," he said. Dickinson also said that ballot language that voters agreed to when they voted to incorporate made it clear that it would cost the city $5.6 million a year. But Ziegler said the city seriously questioned the legality and constitutionality of the conditions imposed on its incorporation. The Citrus Heights lawsuits were significant because few cities have incorporated since 1992. That year, the Legislature enacted a revenue-neutrality law which requires cities to be fiscally viable to incorporate. Cities are prohibited from incorporating if the incorporation would have a negative fiscal effect on a county. The law has essentially stopped incorporations. The dispute, and the desire for other communities throughout the state to incorporate, led to the introduction of several bills in the legislature. One bill, AB 2147 by Assemblyman Bruce Thompson, R-Fallbrook, would repeal the revenue neutrality law. It passed the assembly, and was sent to the Senate Local Government Committee where no hearing datewas set. Several areas in Southern Orange County, near Thompson's district, are interested in incorporating. Under the Citrus Heights settlement agreement, the county was assured that the city would not use future redevelopment areas to siphon off property taxes that the county was expecting. Ziegler said that the agreement includes a "reopener clause" if there is a major shift in the way property taxes and city revenue are received by the city, such as if changes are made in the way revenue is distributed by the state government. Contacts: Supervisor Roger Dickinson, (916) 874-5485. Ruthann Ziegler, Kronick Moskovitz, (916)321-4500

Restraint is rarely touted as a virtue in urban design. Often, instructors in the History of Urban Design tend to treat the subject as a series of Greatest Hits - of grand interventions by such magnificently meddlesome people as Andre LeNotre or Baron Haussman or Robert Moses. Teachers in graduate seminars rarely show slides of, say, a Midwestern town and exclaim, "Look at how well the urban designers held themselves back!" The blockbuster mentality makes the current master plan of Mission Bay, the 300-acre redevelopment area in San Francisco, all the more remarkable. Here, after all, is a giant canvas of largely undeveloped waterfront acreage in a major U.S. city. The first impulse (at least for eternal first-year design students, like myself) is to create a miniature city with a hierarchy of major and minor roads, a radial plan with diagonal streets, major and minor axes, formal green spaces with equestrian statues and topiary plantings - in other words, the whole nine yards of Beaux Arts planning, or its poor relation, the New Urbanism. The current master plan, which is the fifth to be done in 20 years, resists the temptation to make a grand statement, however. Instead, the plan by Johnson Fain Partners opts to impose a more-or-less regular grid over the area that corresponds, in the dimensions of the blocks, to the original 10 blocks of downtown San Francisco. And while the restraint of this plan may or may not seem intuitively like the most exciting or most elegant solution, a close examination of the program suggests that this is the most urbane and best integrates this former railyard into the cultural and business life of the larger city. Indeed, the history of planning efforts at Mission Bay shows the tensions between the need to integrate the area into the city, while creating a memorable place in itself. The site itself is also especially tempting for planners, because it sits at the crossroads of two grids: the commercial-industrial grid, on northeast-southwest coordinates, and a residential neighborhood, on north-south coordinates, immediately south of the commercial area. The first four of the five plans done in the past 20 years, in fact, succumb to the temptation to bring the grids together in dramatic juxtaposition. The first plan, done 20 years ago by John Carl Warnecke envisioned a set of high-rise buildings (office and hotel) on either side of the Mission Bay Channel, which conforms to the commercial-industrial grid. The same plan pulled the north-south grid north of 16th street, to bring housing into Mission Bay. The density and height of the scheme aroused public opposition. In the I.M. Pei/WRT scheme of 1985, the designers attempted to maximize the waterfront by carving out an oval-shaped channel south of Mission Bay Channel; ingeniously, this channel, and the resulting island at its center, are the formal devices to divide the commercial grid from the residential grid. This plan was also opposed for its density. And like the Warnecke plan before it, the Pei scheme was largely lacking in open space along the precious bay waterfront. The third scheme by the Mission Bay Planning Team, led by EDAW and Dan Solomon, is an elegant, Beaux-Arts design that provides a clear hierarchy of streets arranged around a linear park or "common." This scheme also sets aside some bayfront land for a linear park. Pleasing as a graphic design, the plan arguably may have created some confusion on the ground, however, because streets are frequently changing in direction. Those same diagonal streets also disturb the views of the bay that could otherwise be available with streets that run straight east and west. The subsequent Skidmore Owings Merrill plan of 1989 is an inelegant truncation of the Solomon-EDAW that reflects the consensus of public hearings. This plan offers a further elongation of the bay front linear park, while providing more space for commercial construction. New uses at Mission Bay, including a new baseball stadium immediately north of the site and a new campus for UC San Francisco, occasioned the fifth and current plan, this time by Johnson Fain Partners. The campus plan, which conforms to the larger scheme, is by the East Coast firm of Machado + Silvetti. As part of a Willie Brown-endorsed ambition to create a "synergy" between a research university and bio-tech businesses in San Francisco, landowner Catellus donated 43 acres of Mission Bay to UC San Francisco. That acreage is located smack-dab in the center of the master plan. The great achievement of the scheme is to knit Mission Bay into the existing fabric of the city, rather than setting it apart as a separate "campus" or miniature city of its own. Faced with the difficulty of planning around a centrally located campus, the Johnson Fain team, led by principal William Fain, chose to organize most of the site with the north-south (residential) grid; the diagonal streets are limited to either side of the channel. Medium-to-high-density residential blocks (with densities averaging 110 units per acre) can be found both north and south of the channel. Happily, the plan preserves the common of the Solomon/EDAW scheme. A small traffic circle at the far west is the anti-climactic device that connects the two grids. What is most remarkable about this scheme is how thoroughly the university campus has been integrated into the grid. This contrasts with the typical University of California campuses, which are master planned as separate cities and communicate poorly with the cities that surround them. In a competition winning scheme, Machado + Silvetti, has responded with a very urbane, non-hierarchical scheme that uses open spaces as the landmarks, rather than big buildings. Jose Begazo, Johnson Fain's project architect, has likened the campus design to residential blocks in Paris. Importantly, the Johnson Fain designers chose to base the new grid on the historic "vara" block, the same dimension of the first 10 blocks of the city laid out by Vioget in 1839. A vara is a Spanish linear measure equal to 2.75 feet. The vara block is 100 by 150 varas, or 275 feet by 413 feet. Johnson Fain principal William Fain argues that the vara block, beyond its historic associations, has near-ideal dimensions for an urban block. The use of the urban Vara block, in fact, helps clarify, if clarity were needed, what precisely makes San Francisco the most walkable city in America: the dimensions of the grid. No longer an abstract issue, the dimensions of grid here become elements in the sensuous enjoyment of cities - providing the energizing sense of movement through a regular tempo of streets and blocks. This new plan, by relying heavily on the grid rather than special effects, promises to extend the pedestrian experience of San Francisco to the newest part of the city. In a sense, the Johnson Fain/Machado Silvetti scheme could be described as the scheme that resists the temptation to be grand, and in favor of being appropriate. Whether or not college lecturers add Mission Bay to their teaching syllabi remains to be seen. Even so, the scheme is a quiet but convincing argument about the power of the grid.

A joint powers authority created to finance the San Diego Convention Center expansion can issue revenue bonds without voter approval, the California Supreme Court has ruled. The $205 million bond issue was challenged in court by Richard Rider, a taxpayer activist who has frequently filed lawsuits against public agencies in San Diego claiming that two-thirds voter approval is required for financing public projects. Most famously, Rider won a state Supreme Court ruling that a sales-tax increase to finance new jails in the county required two-thirds voter approval. (Rider v. County of San Diego, 1 Cal.4th 1 (1991)). In the case of the convention center expansion, however, Rider lost at the appellate court level. To finance the convention center expansion, the San Diego Unified Port District and the City of San Diego created a joint-powers authority called the Convention Center Expansion Financing Authority. Then the Port District agreed to lease the existing convention center and the site of the proposed expansion to the Financing Authority for $2 per year. The Financing Authority then agreed to issue $205 million in revenue bonds to pay for the expansion of the convention center. The next step was for the Financing Authority to sublease the expanded convention center to the city, which then paid rent equal to the bond payments. In addition, the Port District agreed to pay the city $4.5 million a year to help make those "rent" payments. In return, the Financing Authority agreed to return ownership of the expanded convention center to the Port District when the bonds were paid off. In his lawsuit, Rider argued that the Financing Authority was not an independent entity but merely a "shell" established to avoid the two-thirds vote requirement. (Rider made a similar argument in the sales-tax case, which challenged a jail financing entity.) But the appellate court concluded that creating such a shell, even for the explicit purpose of avoiding the two-thirds vote requirement, was not illegal. "The short answer to plaintiffs' argument," wrote Justice Ming Chin for a unanimous court, "is that the Constitution and the City's charter permit the City to avoid the two-thirds vote requirement by creating a joint-powers agency to finance public works projects. Therefore, however we might characterize the financing plan at issue here, we cannot characterize it as unlawful." In support of this conclusion, the appellate court noted that the taxpayers of the city are not ultimately responsible for the bond payments; rather, only the Financing Authority can be called upon to repay the debt. Rider also argued that the state joint-powers law (Government Code §6500 et. seq.) requires a two-thirds vote because the Financing Authority must comply with the same debt limitation provisions that apply to the city. But the appellate court rejected this argument. While acknowledging that a joint-powers agency can only have the same authority that all of its member agencies have, the court also noted that, according to the law, a JPA has debt-issuance power "in addition to the powers common to the several parties" that make up its membership. "When the Financing Authority issues bonds, it does so independently of any common powers," the court concluded. Finally, the court concluded that the Financing Authority's issuance of debt without a vote was not a violation of the California constitution's home rule doctrine. But the court concluded that this argument rested on the assumption that there was no legal difference between the city and the Financing Authority. "We agree that the City and the Port District are the motivating forces behind the transaction here, but we do not agree that in substance the city is issuing the bonds." In conclusion, Chin said: "We are not naive about the character of this transaction.... he City and the Port District have created a financing mechanism that matches as closely as possible ... a city-financed project, but avoids the two-thirds vote requirement. Nevertheless, the law permits what the City and the Port District have done." The Case: Rider v. City of San Diego, No. S058956, 98 Daily Journal D.A.R. 8535 (filed August 6, 1998). The Lawyers: For Rider: Carl Fabian, (619) 692-0440. For City of San Diego: Leslie J. Girard, Deputy City Attorney, (619) 236-7726.

The Los Angeles County Board of Supervisors has begun scaling back Newhall Ranch, a huge project that has been heavily criticized by neighboring Ventura County. Supervisor Mike Antonovich, whose district contains the proposed project, introduced a motion in July to create more open space and possibly reduce the proposed 24,000 home development by 3,500 homes. The board approved the supervisor's motion that the county's staff should implement the proposed changes at its July 28 meeting. As approved by the Los Angeles County Regional Planning Commission in December 1997, the project would have been the largest subdivision ever processed by Los Angeles County. It would have been built on 12,000 acres, and be home to 70,000 people living in five "villages." (See CP&DR, February 1998). Those numbers are expected to change however, with Antonovich's motion. The massive project was originally expected to be located right on the county line with Ventura County. The project's developer, Newhall Land & Farming Company, owns thousands of acres of adjoining land in Ventura County, and officials there feared that pressure to develop that land could develop if the original project is successful. Under Antonovich's motion, a half-mile buffer would be created between the project and the Ventura County line. The small Ventura County communities of Piru, Fillmore, and Santa Paula had expressed concerns that the project would increase a demand for low-cost housing in their communities, as service workers for the new development would need a place to live. But under the Antonovich motion, additional affordable housing units may be added to the Newhall Ranch project. Marlee Lauffer, spokeswoman for the developer, said that entry-level apartments is among the mix of housing to be offered. Antonovich has also asked for consideration of a 100-foot buffer along the Santa Clara River to protect native plants and animals. That river is the last wild river in Southern California. Antonovich is also seeking open space access from the high country portions of the property to the Santa Clara River. Ventura County Supervisor Kathy Long sent a letter to Antonovich on July 31 after the motion had passed. Long said that Ventura County supports measures to preserve natural resources and provide a buffer between the development and Ventura County. She indicated the county still is concerned that specific steps haven't been taken to guarantee that Ventura County won't face a reduction in its water supply. Long asked that the county employees be invited to a working group that develops the specific details of the motion. Lauffer said that three water sources have been identified for Newhall Ranch--new additional state water, historic rights to overflow from Castaic Creek and reclaimed water. A local chapter of the Sierra Club recently filed a complaint with the Public Utilities Commission against the Valencia Water Co., owned by the Newhall Land & Farming Company, alleging that the water company is near or over its water supply limit. A final decision on Newhall Ranch is supposed to be made by the LA County Board of Supervisors in late October. Contacts: Dennis Slivinski, assistant county counsel, Ventura County (805) 654-2196. Marlee Lauffer, Newhall Land & Farming (805) 255-4247.

In the latest legal skirmishes associated with two ongoing natural resource controversies, the Ninth U.S. Circuit Court of Appeals has ruled against environmental groups and in favor of the federal Bureau of Land Management. In both cases, the environmental groups sought to use the National Environmental Protection Act as a vehicle to gain legal leverage over BLM actions on the east side of the Cascades, and both included proposed land swaps between BLM and a private land exchange. In one case, the Kettle Range Conservation Group sought to delay a swap of land between BLM and a private land broker until more environmental analysis had taken place. In the second case, the Oregon Natural Resources Council sought to halt logging and road construction in eastern Oregon and Washington until an environmental impact statement was completed for a revised regional management plan. In each case, a different three-judge panel of the Ninth Circuit ruled against the environmental group, saying that the group had not met the procedural requirements imposed by NEPA. The first case involved Kettle Range's challenge to the so-called "Clearwater" land exchange in eastern Washington. In 1996, the Clearwater Land Exchange Co. approached BLM to propose an exchange of 44 publicly owned parcels totaling 4,500 acres for eight privately owned parcels containing a total of 25,000 acres. (BLM often swaps land of lesser resource value, located closer to urban areas, for more remote land of greater resource value if such a swap would round out the agency's landholdings.) Although the Washington Department of Fish & Wildlife expressed some concern about the wildlife value of the lands BLM would be trading away, the agency conducted an environmental assessment under NEPA and issued a "finding of no significant impact," or FONSI. Kettle Range sued but was denied a stay of the exchange by U.S. District Court Judge Robert H. Whaley. Within hours of Whaley's decision, BLM conveyed half of the 4,500 acres involved. In May - while the merits of the case were pending before Judge Whaley - BLM conveyed another 1,800 acres. On May 19, Whaley ruled in favor of Kettle Range, concluding that the environmental assessment had serious defects. Whaley ordered an injunction on transfer of the remaining 365 acres of property but denied Kettle Range's request to rescind the earlier transactions. Among other things, Whaley faulted Kettle Range for not seeking to "join" Clearwater Land Exchange - that is, make them a party to the lawsuit - and he questioned the value of a rescission since some of the formerly public land had probably been clear-cut anyway. Kettle Range appealed to the Ninth Circuit, which denied the environmental group's request for emergency injunctive relief. On appeal, Kettle Range argued that it wasn't necessary to join Clearwater as part of the lawsuit because, among other things, NEPA provides no right of legal action against them; and also because public rights were at stake. While acknowledging the NEPA issue, a three-judge panel writing per curiam declined to grant the motion. "Here, title to the land already transferred has vested in the private parties," the court wrote. "We have no doubt that an order declaring the executed portion of the land exchange void ab initio would 'destroy the legal entitlement of absent parties'. As a result, this appeal is not amenable to the public rights exception. ... We are also concerned that at this point it might be impractical to attempt to unscramble the eggs. Any such effort might produce results that are in fact not equitable." In a concurring opinion, Judge Stephen Reinhardt noted that Judge Whaley's hearing on the permanent injunction occurred just AFTER the bulk of the land was transferred, meaning much of his analysis had no practical value. "It is important that both private litigants seeking to enforce environmental statutes and judges presiding over environmental cases remain aware at all times of the practical aspects of the litigation," he wrote. The other case involved whether BLM actions on logging and road construction on the east side of the Cascade Mountains should be halted while BLM and the Forest Service developed an ecosystem management strategy for the entire area, as ordered by the Clinton Administration in 1994. In this case, Clearwater Land Exchange and another property owner were allowed to intervene as defendants with BLM. The environmentalists argued that BLM should have imposed a moratorium on logging, road construction, and land exchanges while the ecosystem management strategy was being prepared and an environmental impact statement under NEPA was being done, in order to preserve possible alternatives that might be identified in the EIS. Based on the recommendations of a magistrate judge, Chief Judge Michael R. Hogan of the U.S. District Court in Oregon dismissed the environmentalists' case. The environmentalists appealed but the Ninth Circuit affirmed Hogan's dismissal. The crux of the environmentalists' argument was that BLM's decision not to institute a moratorium constituted a final agency action under the Administrative Procedures Act, thus creating a "challengeable" action under NEPA. Writing for a three-judge panel, Judge Arthur Alarcon concluded that this argument did not hold water. The environmentalists, Alarcon wrote, "cannot point to a deliberate decision by BLM to act or not to take action. Therefore, the district court did not err in finding that BLM's failure to implement a moratorium was not a final agency action." The environmentalists also argued that it could file a lawsuit because BLM had failed to take required action under both NEPA and the Federal Land Policy Management Act. But the court again rejected this argument. "The Eastside EIS will likely result in new data requiring at least an evaluation of the current RMPs (Resource Management Plans)," Alarcon wrote. "NEPA provides no guidance, however, as to the status of the existing plans. In this case, because the Eastside EIS will likely lead to some revisions of current RMPs, it is reasonable to conclude that the RMPs are existing program statements for the purposes of NEPA. The fact that revisions of other RMPs are not necessarily current does not change this result." Therefore, he concluded, the environmentalists have "failed to point to any clear statutory action for purposes of the Administrative Procedures Act." And, he added, the environmentalists had "not identified a clear duty under NEPA or FLPMA with which BLM must comply." Therefore, he said, no "challengeable action" had been taken. The Case: Kettle Range Conservation Group v. Bureau of Land Management, No. 98-35516, 98 Daily Journal D.A.R. 7855 (issued July 20, 1998). The Lawyers: For Kettle Range: Marianne Dugan, Western Environmental Law Center, Portland. For BLM: James R. Shively, Assistant U.S. Attorney, Spokane. For Clearwater Land Exchange: Paul A. Turcke, Moore & McFadden, Boise. The Case: ONRC Action v. BLM, No. 97-35467, 98 Daily Journal D.A.R. 8125 (issued July 30, 1998). The Lawyers: For ONRC Action: Marianne Dugan, Western Environmental Law Center, Eugene. For BLM: Ellen J. Durkee, U.S. Department of Justice, Washgton, D.C. For Clearwater Land Exchange: Paul A. Turcke, Moore & McFadden, Boise.

Reversing a district court judge's ruling, the Ninth U.S. Circuit Court of Appeals has concluded that a Native American tribe is not an "indispensable party" in an environmental group's endangered species lawsuit against the federal government. The case involved the Southwest Center for Biological Diversity's lawsuit challenging the federal government's plan to use more water storage capacity behind Roosevelt Dam in Arizona. The group claimed that the government had not done adequate analysis of the impact on the Southwestern Willow Flycatcher, an endangered species. The Southwest sued the federal government and the Salt River Project and Power District, a federal water project, to force more analysis of the environmental impact of the newly completed Additional Active Conservation Capacity behind the dam. Several Arizona cities, including Phoenix, Chandler, Scottsdale, and Mesa, successfully intervened in the lawsuit because they have helped pay for the additional storage capacity. The Southwest Center did not, however, also sue the Salt River Pima-Maricopa Indian Community. Under a 1988 settlement agreement that permitted construction of the additional water storage capacity, Pima-Maricopa is considered a "non-party with rights". Seeking to intervene, the tribe made a motion to dismiss the suit under Federal Rule of Civil Procedure 19. U.S. District Court Judge Paul G. Rosenblatt in Arizona ruled that the tribe was a "necessary and indispensable party" to the lawsuit and the Southwest Center appealed. In making the ruling, Rosenblatt acknowledged that the federal government has the same interest in the case as the tribe - that is, the interest of seeking that the additional water storage capacity is activated as quickly as possible. Rosenblatt also acknowledged that the federal government could adequately represent the tribe's interest but was unlikely to do so because the federal government opposed the tribe's own motion to dismiss the suit. In a per curiam decision, the Ninth Circuit overruled Rosenblatt. "The district court's approach is circular," the appellate court wrote. "A non-party is 'necessary' even though its interests are adequately represented on the underlying merits by an existing party, simply because that existing party has correctly concluded that it is an adequate representative of the non-party, and therefore opposes the non-party's motion to dismiss. The district court's approach would preclude the United States from opposing frivolous motions to dismiss out of fear that its opposition would render it an inadequate representative." The court also took issue with Judge Rosenblatt's assertion that the federal government may have potentially inconsistent responsibilities under its trust obligations to the tribe and applicable environmental laws. "Neither the district court nor any of the parties has explained how such a conflict might actually arise in the context of Southwest's suit," the Ninth Circuit wrote. In addition, the Ninth Circuit concluded that the cities would help to adequately ensure the tribe's interests are represented. "Although they assert they do not adequately represent the Community, they offer nothing to show that their interests in the AACC or the arguments they would make differ at all from those of the Community," the court said. Judge Rosenblatt also concluded that the tribe is a necessary party because, if it were not included as a party, litigation would ensue under the 1988 settlement agreement to determine what the tribe's rights in this situation actually were. But the court concluded that "ambiguity in the settlement agreement could result in litigation even if Southwest's suit were dsmissed." The Case: Southwest Center for Biological Diversity v. Babbitt, No. 98-15038, 98 Daily Journal D.A.R. 8542 (filed June 9, 1998). The Lawyers: For Southwest Center: Geoff Hickcox, Kenna & Hickcox, Durango, Colorado. For U.S. Government: M. Alice Thurston, U.S. Department of Justice, Washington, D.C.

The Campbell city clerk acted properly in rejecting portions of a referendum petition it sought to place a major development project on the ballot, the Sixth District Court of Appeal has ruled. The case emerged from the city's decision last December to change the land-use designation on a parcel of land commonly known as the "Winchester Drive-In Site" to permit development of a research park proposed by WTA Technology Park, a developer. The city council voted to change 20 of the 24 acres to business park designation, while changing the remaining four acres from commercial to public open space. In January, a group of local citizens opposed to the new project submitted petitions containing some 3,000 signatures seeking to place the Winchester Drive-In decision on the ballot as a referendum. The signatures were contained on 203 separate "sections" of the petition. However, the sections were not consistently worded. In 179 of the 203 sections, the words "of four acres" (referring to the public open space portion of the project) were left off of the petition's recitation of the official title of the ordinance. These words were included in the remaining 24 sections of the petition. City Clerk Ann Bybee concluded that the 179 sections were defective and rejected the petitions even though they apparently contained enough valid signatures to qualify for the ballot. The local citizens sued, seeking a writ of mandate ordering the city clerk to accept and certify all the sections. Santa Clara County Superior Court Judge John Herlihy directed the city clerk to accept the 24 valid sections and reject the 179 defective ones. This left the citizens with only 334 valid signatures - far short of the 1,901 required to qualify for the ballot. The citizens then appealed, making three arguments associated with Elections Code §9238, which governs the question of defective signature petitions. The citizens argued that the petitions were valid because they contained the ordinance number as well as the defective ordinance title; because the petitions met the "substantial compliance" test even with the defective title; and because the trial court assumed "voter confusion" existed when there was no evidence of it. The court rejected the citizens' argument on all three fronts. Regarding the notion that the petitions technically complied with the statutes because they contained the ordinance number, the appellate court agreed that the Elections Code requires that petitions include either number of title. But, the court said, "this does not mean that they were free to include an inaccurate title. ... By choosing to include both the number and title of the Ordinance, appellants had a duty to provide both of them correctly to the voters who would rely on the accuracy of the materials presented." Regarding the substantial compliance argument, the citizens argued that the incomplete title "did not frustrate the purpose" of the Elections Code. But the court disagreed with this argument as well, suggesting that in the absence of the four-acre information, voters could read the title of the ordinance some five different ways. (The title of the ordinance also included the 19.58-acre designation of the remainder of the site.) Finally, the citizens who appealed the city clerk's decision argued: "There could be no confusion in the minds of persons asked to sign the petition as to its purpose, namely, to rescind the industrial designation of the Drive-In property." But the court did not accept this argument either. "Here," the court concluded, "evidence of actual voter confusion was not necessary to the court's determination that the misstated title failed to satisfy the reasonable objectives of the statute." The Case: Hebard v. Bybee, No. H018240, 98 Daily Journal D.A.R. 8458 (filed August 3, 1998). The Lawyers: For Hebard and other citizens: Harry A. Oberhelman III, (408) 425-2041. For Bybee and City of Campbell: William R. Seligmann, Dempster, Siligmann & Raineri, (408) 399-7766. For WTA Technology Park LLC (Real Party In Interest): Myron L. Brody, Rosenblum Parish & Isaacs, (408) 977-0120

Ending a two-year political stalemate, the Legislature has placed a $9.2 billion education bond on the November ballot with conditions that would fundamentally change the way school construction is financed in California. Under the proposed reforms, local school districts would have to cover half the cost of new schools, and the state would suspend the ability of cities and counties to levy school fees in excess of state-mandated limits - a power granted by a series of appellate court decisions collectively known as the Mira doctrine. With the Mira powers gone, a statewide cap on school fees of $1.93 per square-foot for housing and 31 cents per square-foot for commercial and industrial construction would be back in force. Local school boards could impose higher fees in order to meet their 50% match requirement if certain conditions are met. Finally, if the state bond money runs dry, districts that meet those conditions could assess developers 100% of the cost of new schools required by the families who will buy their homes. The developer-fee reforms will essentially shift the authority to deal with developers over school-financing from cities to school boards. They will take effect only if voters approve the bond act, which will appear on the November ballot as Proposition 1A. "It won't be as easy as it was before," said Richard Simpson, education consultant to Assembly Speaker Antonio Villaraigosa, D-Los Angeles, the lawmaker who brokered the bond deal. "If you were a superintendent, you didn't have to justify anything to anybody. If the city council was sufficiently cooperative, you just gave them a number and under their Mira power they imposed it as a condition." An estimated 200 to 250 districts statewide use the Mira powers of their local agencies to levy fees averaging $4 per square-foot on new housing, according to a survey by the Association of California School Administrators. The reforms contained in SB 50 are a victory for the California Building Industry Association, which successfully fought to block any new statewide education bond unless elimination of Mira was part of the deal. "We made the case for complete repeal of Mira," said BIA lobbyist Richard Lyon. "We wanted to annihilate it, blow it up in a nuclear explosion....But the politics of the issue wouldn't let that happen, so we settled for an eight-year suspension." The suspension allows for a return to conditions similar to current law in 2006 if a subsequent statewide bond issue fails. If that were to happen, local agencies could again deny zone changes or general plan amendments on the basis of inadequate school facilities, but could not require higher fees than those allowed under the bill. Proposition 1A is the largest bond act in state history, and would provide $6.7 billion for K-12 school construction and modernization and $2.5 billion for higher education. The bonds would be issued over four years. The developer-fee provisions allow districts to levy fees to cover 50% of land and construction costs if they have conducted a needs analysis and are certified by the State Allocation Board as eligible for state funding. In addition, they must meet at least one of four conditions: (1) Attempted a local school bond in the last four years that received at least 50% of the vote but short of the required two-thirds majority; (2) Have passed bonds equal to 15% of bonding capacity; (3) Have 30% of students on a multi-track year-round calendar, or (4) Have 20% of students housed in portable classrooms. After Jan. 1, 2000, districts must meet at least two of those conditions in order to levy fees above the statewide cap. The adoption of the school bond assured voters the chance to deal with the $40 billion challenge of building sufficient classrooms to house the 5 million additional students who will enter California schools over the next 10 years. But the developer-fee provisions did not satisfy the long-held concerns of cities and the education establishment. The state School Boards Association and the League of California Cities remain opposed to the fee provisions. "The notion of losing your land-use authority shouldn't be too comforting," said League of Cities lobbyist Dan Carrigg. "The state is saying to city councils that they cannot deny a project even if in their opinion school facilities are inadequate." The core problem, he said, is that the program fixes the cost of new schools at statewide averages. If that is not enough in a given area, cities could be forced into having to approve new development without sufficient schools. "Local discretion," he said, "is tossed out the window." Carrigg also notes that the bill grandfathers only those existing school-fee arrangements contained in development agreements. Developers with projects in the planning pipeline that have been conditioned with higher school-impact fees can avoid the higher fees if they delay construction beyond Jan. 1, 2000. Carrigg and other foes, conceding that political realities and the critical need for state bond money make opposition to Proposition 1A impossible, have turned their attention to how to react to the changes once they take effect. Now that the developer-fee statutes are no longer part of a bond package that required a two-thirds vote of the Legislature, they can be amended by simple-majority vote. "If quickly after implementation a number of horror stories crop up," Carrigg said, "we could come back and try to clean up those problems.... That's something I find comfort in." There is also the chance the issue could be thrown back to the courts. As a condition of getting state assistance, a district has to certify that it has sufficient funds, combined with state money, to build a school. But if actual costs are higher, the district may not in fact be able to build. "Then what?" asks Carrigg. "The local government still can't deny a project. Let's see the court that says it's OK to build another 500 homes with no schools." Another alternative, suggested Stephen Hartsell of the Kern County Superintendent of Schools Office, would be for a district to seek voter approval for a districtwide Mello-Roos bond that features a one-time special tax on new construction permits. "I believe it's constitutional," said Hartsell, who is legal adviser to the Coalition for Adequate School Housing. "It passes the sniff test. It's not been done before because under Mira authority you could compel landowners to do that." Lyon of the BIA dismisses the concerns of critics, both about the adequacy of school funding under the plan and the alleged loss of local control over land-use decisions. "Cities can deny a project on any ground that's legitimately out there," he said. "We all know that if you're looking to deny a project there are plenty of opportunities out there... But for at least eight years, local government won't be able to second-guess pre-emptive state law on school fees." The system is structured, he said, to guarantee 100% financing for new schools - facilities that may not have all the amenities some administrators desire, but which meet state standards. The allowable amounts - $10,400 per-pupil for elementary schools, $11,000 for middle schools and $14,400 for high schools - are based on averages from projects built over the last several years. The standardized construction figures do not include the price of land, because real estate costs vary radically among regions in the state. The program provides for land costs based on market value. "We've guaranteed that in all cases the system will finance construction of a school," Lyon said. "With 100% financing, what's the concern? ... We're left with the conclusion that the opposition is for no-growth." Contacts: Dan Carrigg, League of California Cities (916) 658-8222. Richard Lyon, California Building Industry Assn. (916) 443-7933. Steve Hartsell, Coalition for Adequate School Housing (805) 636-4599. Dennis Meyers, Assn. of California School Administrators (916) 444-3216. Timm Herdt is the Sacramento correspondent for the Ventura County Star.