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Two referendums of large housing projects in the City of Loma Linda have been reinstated by the Fourth District Court of Appeal. The court overturned a Superior Court judge's decision to pull the referendums from the June 2006 ballot because referendum petitions failed to contain the full text of challenged ordinances. The Fourth District found the petitions to be legally adequate, clearing the referendums to appear on ballots in 2009. In recent years, Loma Linda has replaced Redlands as San Bernardino County's center of ballot-box planning. After the disputed measures were pulled, voters passed a different initiative in November 2006. Measure V established a 7,200-square-foot minimum lot size for the entire city, preserved about two-thirds of the 3,000-acre "South Hills" area as permanent open space, imposed new building height restrictions and mandated development traffic mitigation. Voters rejected a city-backed alternative concerning the South Hills territory. The developer of one of the projects targeted by a disputed referendum has sued over Measure V. A San Bernardino County Superior Court judge upheld Measure V earlier this year, but an appeal is pending in the Fourth District. That case is Holland Partners Orchard Park, LLC v. City Council of Loma Linda , No. E046153. The referendums concerned two large projects approved in September 2005: the 990-unit, 138-acre Orchard Park project, and the 1,500-unit, 168-acre University Village project. Both projects would also contain substantial office and retail space (see CP&DR Local Watch , December 2005 ). A group called Save Loma Linda prepared a referendum on each project and obtained enough signatures to force a vote. Ten days before the deadline to print the June 2006 ballot, however, the pro-growth group Friends of Loma Linda sued. Friends of Loma Linda submitted two one-page exhibits describing last-minute project modifications approved by the City Council; the referendum petitions did not contain the exhibits. Within days, Superior Court Judge Martin Hildreth removed the referendums from the ballot, concluding referendum authors' failure to include the exhibits was "fatal." But the Fourth District determined the exhibits were simply documents prepared by Friends of Loma Linda and unavailable to referendum proponents. The last-minute project changes approved by the City Council never made it into any official document, nor were they even referenced by the formal resolutions and ordinances. "The one-page exhibits describing the specific plan modifications were not required to be included in the referendum petitions, because they were not part of the text of any of the challenged resolutions or ordinances," Justice Thomas Hollenhorst wrote in an unpublished decision. State elections law does not require "the inclusion of information or documents that are not part of the text of the proposed measure or the challenged ordinance, regardless of their informational value to voters." The case is Friends of Loma Linda v. Verjil , No. E040974 and was filed on August 19. Orchard Park and University Village have not moved forward because the specific plans must be revised to comply with Measure V. Still, Save Loma Linda is pressing to have the referendums on the ballot as soon as possible.

Calling Proposition 13, "deeply flawed," a new report by the Lincoln Institute of Land Policy recommends entirely new approaches to property tax relief. Some of what the report says has been reported previously: Proposition 13 has resulted in radically different tax bills for similarly situated properties; the measure places a disproportionately large tax burden on new homebuyers; it has benefited commercial property owners more than residential owners; and it has forced local governments to compete for sales tax-generating development (see C P&DR , June 1998 ). The report also argues that severing the connection between property values and property taxes makes the tax system unaccountable and unclear. The authors further contend that Proposition 13 causes homeowners to stay put even when moving closer to a job otherwise makes sense. "Assessment limits are often put forward as a means of combating two problems popularly associated with rapidly appreciating property values: increasing tax bills and the redistribution of tax burdens," according to the report, Property Tax Assessment Limits: Lessons from Thirty Years of Experience . "In fact, 30 years of experience suggests that these limits are among the least effective, least equitable and least efficient strategies available for providing property tax relief." The report was prepared by Terri Sexton, an economics professor at California State University, Sacramento, and associate director of the University of California, Davis, Center for State and Local Taxation, and by Mark Haveman, executive director of the Minnesota Taxpayers Association. They recommend four alternatives to Proposition 13: • "Circuit breaker programs" that cut taxes when they rise above a certain percentage of income. • "Truth in taxation" measures that require public notice or even elections before tax revenues may exceed the prior year's total. • "Deferral options" that permit qualifying owners to delay tax payments until their home is sold or estate is settled. • "Partial exemptions" for owner-occupied housing units, and "classified tax rates" that permit rates to rise for commercial and industrial properties. The report is available on the Lincoln Institute website, www.lincolninst.edu .

Senate Bill 375 – commonly referred to in the popular press as the "climate change smart growth bill" – is going to become a law . The newspapers have been calling the legislation "precedent setting," but it's got nary a new idea in it. If you peel back the layers, you've got what old-timers like me call a "growth management law" – one that ties transportation funding to growth patterns. The ideas in SB 375 have been kicking around Sacramento for 20 years. But until the passage of AB 32 , which is essentially an air pollution law that contains a ferocious mandate to reduce greenhouse gas emissions, there was no issue in Sacramento overpowering enough to break the decades-old logjam involving enviros, builders, and local governments. The question now whether SB 375 – combined with all the other darned laws we already have in place here in California – will actually influence the state's growth patterns. SB 375 says that each region in California has to create a preferred growth scenario that will minimize greenhouse gas emissions, and then ties state transportation funds to projects that conform to that preferred growth scenario. This is not exactly a revolutionary idea. In fact, it's the basic idea contained in the "original" smart growth policy, the one put into place by Maryland Gov. Parris Glendening in 1997. In California, the idea's pedigree goes back much farther than that. Most of the growth management proposals of the late 1980s contained this exact same idea. (I'd hyperlink to old CP&DR stories about Willie Brown and regional planning, but the stories are so old we don't have them on-line.) The policy contained in SB 375 is already in place in Contra Costa County , thanks to the county's 1990 growth management initiative, which created an urban limit line and requires local governments to adhere to a growth management policy in order to qualify for transportation funds. It's important to remember, however, that SB 375 is only one of several state laws and policies dealing with growth – and unless the Schwarzenegger administration is serious about using all of them consistently, the impact of the new law is likely to be reduced. There is, for example, AB 857 , the 2002 bill that requires all state actions to promote a smart growth development pattern but has never really been implemented. There's also Schwarzenegger's own "Strategic Growth Council," which is supposed to address growth issues but may in fact be mostly designed to promote public-private partnerships on transportation infrastructure projects. And, of course, there is the $40 billion in 2006 bonds , which could play a big role in altering growth patterns if the money was spent with smart growth in mind. The good news is that some of the bond money is being spent to promote a different growth pattern, including the $1 billion or so in the 2006 housing bond set aside for infill and transit-oriented development . But most of the infrastructure money – for transportation schools and flood control – is not being doled out with smart growth or greenhouse gas emissions in mind. And Schwarzenegger isn't pushing very hard to change the allocation system. All of this means that, even though California is finally going to tie some transportation money to growth management, not everybody in Sacramento is traveling in the same direction. – Bill Fulton

The state Assembly has voted 46-22 to approve SB 375, the bill that ties together land use planning, transportation funding, affordable housing planning and greenhouse gas reductions. The largely party-line vote followed a 40-minute debate in which Republican bill opponents argued the measure would erode local land use control. The mostly Democratic supporters rejected that argument, noting that the League of California Cities and the California State Association of Counties endorsed SB 375. "The era of dollar-a-gallon gasoline ... of planning the way we have in the past, that era has passed," Assemblyman Mark DeSaulnier (D-Martinez) said while endorsing the legislation. Senate Bill 375 now returns to the Senate, where members will consider the substantial amendments added to the bill since the Senate approve it last year. Passage seems likely, however, because bill author Darrell Steinberg (D-Sacramento) is in line to become the next Senate president pro tem. – Paul Shigley

The State of California is nearly two months into the 2008-09 fiscal year, and it faces at least a $15 billion gap between current spending levels and tax revenues. Yet there is no sense of urgency at the state Capitol. Earlier this month, I predicted that lawmakers would pass a budget by August 25 because that's the day the Democratic National Convention starts and every Democrat wants to be in Denver. Looks like I'm wrong again. Legislators continue to work on non-budget bills, and this week they have spent an extraordinary amount of time on ceremonies for termed-out members. But there has been surprisingly little budget negotiation. In an interview with the Sacramento Bee , Gov. Schwarzenegger lays part of the blame on term limits. He notes that this is the first year that Assembly Speaker Karen Bass (D-Los Angeles) and Senate Minority Leader Dave Cogdill (R-Modesto) have participated in leadership-level budget talks. "It's just one of those examples that chasing people out of the building after a certain amount of years, even though they're still capable of leading and doing a good job, like Burton, is a mistake," the governor told the Bee . What the governor didn't mention is that he has declined to participate in most of the legislative leadership's budget haggling. The "Big 5" this year has been the "Medium 4." Redevelopment update Earlier this week, the governor released a "proposed compromise" that includes a "temporary" $228 million diversion of tax increment from redevelopment agencies to schools. The governor's proposal is to shift the greater of 5% or $225 million from redevelopment to schools every year for three years. In a legislative update, California Redevelopment Association Executive Director John Shirey said he thinks this shift could become permanent . The idea of using property tax increment to ease the state's budget woes has been floating around the Capitol for weeks. The idea is not going away, rather, the size of the shift seems to be increasing. Five percent is real money for many redevelopment agencies, whose ability to repay bonds and proceed with projects could be jeopardized. If the shift of funds from redevelopment agencies is approved, it would render meaningless a bill passed this week (AB 2594-Mullin) that permits redevelopment agencies to use non-housing revenues to acquire foreclosed housing and to assist homeowners, developers and lenders in financial straights (see CP&DR , July 2008). The state's budget solution would ensure that redevelopment agencies do not have "extra" revenue lying around to spend on housing. – Paul Shigley

I've been listening to sports talk radio since "Sportsphone 68" with Scottie Sterling was on the Bay Area airwaves during the 1970s. I think the show was on for a couple hours on weekday evenings. These days, there are full-time sports radio stations, and some of them fill nearly all 24 hours with talk shows. These shows mostly amount to guys (and the rare brave gal) bloviating about which teams and players suck or rule. Although they have memorized the previous night's scores and stats, few participants – hosts included – have any real insight into why Team A beat Team B, or why Player X was unable to rush for a critical first down. Mostly, the folks on sports talk radio want to express their strong opinions. When the subject is big-time spectator sports, it doesn't matter that the opinions are based on very few actual facts because none of it really matters. It's only sports. Over the years, discussion about things that do matter — such as social policies that effect millions of people's everyday lives – has devolved to the level of sports talk radio. "Dialogue" amounts to a bunch of hot-headed people with strong opinions yelling over one another. You get name-calling, shouting, insults, threats – essentially all the things that your mother and second grade teacher warned you about. And this doesn't occur solely on AM talk radio and cable television. You can see vivid examples in the comments that many newspapers permit readers to post at the end of on-line stories. If you scroll down very far in these comments, you'll find dialogue that goes something like this: "You're an idiot." "No I'm not, you are." "Takes one to know one." "You must know them all." What once seemed like a populist idea – letting readers comment immediately about the news of the day – has become just another annoyance. However, at least a few newspapers are reconsidering their policy of letting readers self-post anonymous comments. The Sacramento Bee ombudsman recently questioned that paper's policy after commenters attacked a rape victim who testified before a legislative committee. This is my way of getting around to talking about CP&DR 's policy regarding comments on news stories and blog entries. We permit readers to post comments. You simply need to be registered and logged in to read or post comments. Although we don't receive a lot of comments, we strongly encourage them because the level of dialogue here is different. Our audience is sophisticated and the comments reflect this. Since we started allowing comments a little more than a year ago, we have removed exactly one submittal. It was a diatribe that was only tangentially related to the subject at hand. I'm sure no newspaper would have removed the comment, but our standards are higher. Am I being elitist? Probably. But I do know that I'm not the only person who values facts, well-researched analysis, reasoned argument and opinions that just might be different from my own. So, if you want to comment on any story you see on this website — including this very blog entry — sign up, log in, and have at it. We're happy to foster a discussion about land use policy, real estate development and related subjects. I have no doubt that our readers still remember what their second grade teachers taught them about civility. - Paul Shigley

A federal judge's ruling blocking development of a controversial condominium project on the shore of Big Bear Lake has been thrown out by the Ninth U.S. Circuit Court of Appeals. The Ninth Circuit ruled that the district court had no jurisdiction to consider alleged Clean Water Act violations because environmental groups' notices to the developer regarding potential violations of the act were inadequate and federal agencies were already forcing corrective action. The Ninth Circuit further rejected alleged violations of the Endangered Species Act as both bogus and moot. The Ninth Circuit also threw out an award of $1.7 million in attorney fees to the environmental groups, a $1.3 million penalty, and a ruling that the developer was in contempt. The Ninth Circuit ruling marks a stunning reversal in a dispute that developer Irving Okovita had previously lost on a number of levels. The ruling also appeared to be a blow at Central District of California Judge Manuel Real, the 84-year-old appointee of President Johnson who has been under investigation by both the Ninth Circuit and a congressional committee in recent years. The Ninth Circuit has removed Real from at least eight cases, according to the American Bar Association Journal . Real's rulings in the Big Bear Lake controversy drew plenty of attention, but so has the entire affair. In 1989, Okovita and partners in the Marina Point development bought a 12.5-acre site on the north shore of Big Bear Lake in the very small town of Fawnskin. There was a recreational vehicle park, campground and marina on the site at the time. Okovita proposed building 133 condominiums and a 175-slip marina. Over the course of several years, the developer lined up all necessary local, state and federal approvals for the project. Construction was slow to proceed, however, and an Army Corps of Engineers permit for dredging in the marina expired in May 2002. The Corps allowed work to continue but in July 2003 issued a cease and desist order because a contractor was using the wrong equipment and stockpiling dredged material below the high water mark. By that time, the project had gained prominence among local environmentalists, who contended the site provided bald eagle habitat. The groups Center for Biological Diversity and Friends of Fawnskin sued in April 2004, arguing that the developer had violated the Clean Water Act and the Endangered Species Act. Okovita responded by suing members of Friends of Fawnskin and United State Fish and Wildlife Service employees under the Racketeer Influenced and Corrupt Organization Act (RICO). Okovita claimed his adversaries had illegally conspired to halt the development project and lower the property value so they could purchase the land. Judge Real quickly threw out the RICO lawsuit and later ordererd Okovita's attorneys (who were not involved in the case at hand) to pay $267,000 for filing a frivolous lawsuit (see CP&DR In Brief , August 2006 , September 2005 ). Meanwhile, the environmentalists' lawsuit moved to trial, and in June 2006 Real ruled that the Marina Point developers had violated the Clean Water Act and Endangered Species Act. Real permanently blocked any development on the site without court authorization, awarded attorney fees and imposed a statutory penalty. Last year, he found the developer in contempt and issued various orders based on that finding. None of those rulings held up at the Ninth Circuit. For a citizen to sue under the Clean Water Act, he first must provide a 60-day notice of intent to sue that describes the activity in question. " he notice is not just an annoying piece of paper intended as a stumbling block for people who want to sue," Ninth Circuit Judge Ferdinand Fernandez wrote in the opinion for the three-judge panel. "The purpose is to accomplish corrections where needed without the necessity of a citizen action." Over the course of five months beginning on June 30, 2003, the environmental groups filed four notices regarding dredging and the placement of fill material into the lake. But the Ninth Circuit determined that the notices were not detailed enough because they did not specify exactly how and when the developer violated the Clean Water Act (CWA). Plus, between the second and third notices, the Corps of Engineers issued a cease and desist order, and prior to the fourth notice the Corp authorized the developer to take corrective measures. Thus, the court determined, the environmental groups could not bring a Clean Water Act lawsuit. "" n light of the defects in the notices, and in light of the fact that the Corps and Marina Point did act to cease the activities that the center claimed were wrongful and even acted to effect ongoing repairs for any problems caused by past activities, the district court did not have jurisdiction to hear the CWA action," Fernandez wrote. "It should have dismissed the action at the outset." Regarding the alleged Endangered Species Act violations, the court found the lawsuit was moot because the Fish and Wildlife Service removed the bald eagle from the endangered species list last year. But even after declaring that part of the suit moot, when considering the award of attorneys fees, the court addressed the merits of the claim that the development would harass the raptors. The court concluded the project would not harm raptors. " aking all of the evidence together, there was no basis for a finding that there was some sort of causal connection between Marina Point's activities and any disruption of the behavioral patterns of the bald eagle," Fernandez wrote. Although the Ninth Circuit lifted the injunction against the development, it is unclear when construction might proceed because of the troubled housing market. The Case: Center for Biological Diversity v. Marina Point Development Co. , No. 07-56574, 08 C.D.O.S. 10204, 2008 DJDAR 12307. Filed August 6, 2008. The Lawyers: For CBD: Bernice Conn, Robins, Kaplan, Miller & Ciresi, (310) 552-0130. For Marina Point: Robert Crockett, Latham & Watkins, (213) 485-1234.

It's the last week of the California Legislature's session, and we're still on the SB 375 watch. SB 375 is, of course, Sen. Darrell Steinberg's bill that would implement the AB 32 greenhouse gas emissions reduction bill by tying state transportation and infrastructure money to regional plans to create "sustainability communities." It has been years since California Planning & Development Report has covered a bill this much. Last year, the bill got almost all the way through the Legislature before Steinberg pulled it at the last minute. Ever since, it has been the focus of extensive negotiations among builders, local governments, and environmentalists. Last week, proponents announced a deal had been done – but this may have been wishful thinking . The reason for all this hullabaloo is that all the experts agree the state can't hit the greenhouse gas emissions reduction targets in AB 32 through technological fixes alone, and that 10-15% of the solution has to come from changing growth patterns in a way that reduces overall driving . This attention to land use has given smart growth advocates and environmentalists an opening in Sacramento, but it's not something that builders or local governments really want to hear. We assume SB 375 will pass in some form, setting off a frenzy of activity in California on how to implement the legislation. But it's worth noting that the whole AB 32 thing might be short-lived. No matter who is elected president in November, it's likely that a federal greenhouse gas reduction bill will pass that could override AB 32. Even if there is no new federal legislation, it's likely that the next administration – of whichever party – will likely give California more leeway on technological solutions. For example, the state has run into trouble with the Bush administration on tougher fuel economy standards. California asked the Environmental Protection Agency for a waiver permitting the state to impose tougher standards than the feds – the kind of action that the EPA has routinely granted in the past for tailpipe emissions. Surprisingly, the EPA pushed back, saying that greenhouse gas emissions, unlike other air pollution, creates a global problem rather than a local one and therefore California should not get the waiver. Schwarzenegger and Bush remain at loggerheads on that one, but even a McCain administration might back off. It's also worth noting that in the last 20 to 25 years, California has been very successful at being on the cutting-edge of technological fixes such as cleaner-running cars and energy conservation. On a per-capita basis, the state is among the most electricity-efficient places in the world, and builders are moving quickly toward green building practices. On smart growth, however, California has been behind the curve. And it may be that the state is such a crazy quilt of interests on growth that we'll stay behind the curve. If the state can't get its arms around the question of growth patterns, that will put more pressure on the technological improvements. – Bill Fulton

A housing bill that local governments love and affordable housing advocates hate has passed the state Legislature. Assembly Bill 2000 by Assemblyman Tony Mendoza (D-Norwalk) would permit a city or county in which newly constructed housing exceeds the jurisdiction's regional fair share to count the "excess" units during the next round of the regional housing needs allocation (RHNA). For example, if a city is told by its council of governments and the Department of Housing and Community Development to plan for 50 units of moderate-income housing during a planning period but builders provide 60 units, the city would have 10 units to count against its next allocation of moderate-income units. (A city could not produce extra moderate-income units and count them against future low- or very low-income allocations.) Local governments say the bill provides an incentive for cities and counties to approve needed housing. On the other hand, affordable housing advocates argue the bill marks a dangerous shift because it treats the RHNA numbers as a ceiling, rather than as a floor. Plus, the advocates say, RHNA numbers are forward-looking; the allocations don't consider housing shortages that have accumulated over the years. The City of Cerritos is sponsoring AB 2000. Through the development of several senior housing complexes, Cerritos exceeded its RHNA allocation of very low- and low-income units for the 1998-2005 planning period. Cerritos wants credit for this excess in the current RHNA cycle. The Senate narrowed the bill a bit by requiring deed restrictions for units in the lowest income levels and by permitting HCD to establish criteria for determining the appropriate income level when providing credit for excess units. Still, housing advocates and HCD remain sharply opposed. Somewhat surprisingly, the bill passed easily in both houses. The state Senate on Tuesday voted 28-3 for the bill, which now heads to the governor. (Procedurally, the Legislature is holding all bills for the time being because Gov. Schwarzenegger has vowed to veto any bill that reaches him before a budget is passed.) No matter when AB 2000 actually lands on the governor's desk, he may very well veto it. Not only is HCD opposed, but the building industry appears to have reservations as well. What of the "big" land use bill — SB 375 ? Housing advocates this week very reluctantly signed on, and the deal is holding for now. The bill is pending on the Assembly floor. – Paul Shigley

What really matters in economic development today? How about highway access – and labor cost – and energy cost? Huh? What ever happened to the New Economy? You know, all those creative types sitting around coffee shops drinking lattes and typing on their laptops? (Which, by the way, is what I am doing right now.) The answer is that there's still plenty of "old economy" to go around in the United States. Manufacturing still accounts for more than 10 million jobs and more than 10% of the nation's gross domestic product. And no matter how caffeinated manufacturing executives need to be, they don't place a high priority on lattes. In researching my latest economic development column for Governing magazine , I ran across a survey of manufacturing executives conducted by Area Development magazine . And what manufacturing executives want more – far more – than anything else is: 1. Highway accessibility 2. Skilled labor 3. Low labor cost 4. Cheap and available energy 5. Available land 6. Low construction costs Since I'm blogging for a California land use publication, the obvious question that comes to mind is whether it's possible to provide any of these things in the Golden State. I'm going to surprise you. I'm going to say we have some of these things. We've actually got highway accessibility – though highways are often congested. We've got skilled labor, though not low labor costs. And because of California's remarkable energy efficiency, our energy costs are actually pretty low. Which brings us to the last two – available land and low construction costs. Construction costs are through the roof. And you'd think we don't have available land – especially in the coastal metros where most of the skilled labor is located. Think again. As CP&DR has written about repeatedly, there's a big movement among many of our larger, older cities to use heavy regulation to protect industrial land . In a way, industrial land is the new farmland. Factories are running more efficiently now, because they don't need the number of workers they used to. They are more high-tech. But they still need lots of land to operate – and the land they have historically used is under tremendous pressure to recycle to housing, retail, and office, largely because of its location. San Jose, Oakland, Los Angeles, and San Diego are all talking about using farmland preservation-style regulation to protect their industrial land for the future. L.A. in particular is in a knock-down-drag-out political fight over industrial lands . A lot of analytical horsepower is currently going into the question of whether to preserve this land through regulation and, if so, which parcels and uses should be priorities. I'd say the answers might lie partly in the priorities of manufacturing executives. If we've got skilled labor, highway access, cheap energy and available land – 4 of the Big 6 priorities – is that enough? Or is the cost of labor and construction just too high to make it worthwhile to preserve industrial land? I'll ponder this question as I sip my latte. – Bill Fulton

Climate change has a lot of people talking about "alternative" energy and water resources. Fine, say some people, let's built more dams for hydroelectric power and impound more surface water. But that's not what environmentalists have in mind at all. It's a conundrum, and it's one I deal with in a story on dam removal that appears in Planning magazine's special edition on water. (Sorry, the story is available only to American Planning Association members.) What I learned in reporting my story is that 273 dams have been removed in the United States since 1999. In general, these were small structures that were obsolete or unsafe. We recently reported in CP&DR on the removal of two of these dams from Alameda Creek near Fremont. But what to do about larger dams that generate a decent amount of electricity and provide water for farms and cities? The dams might be bad for the health of the river's ecosystem, but we need the carbon-free electricity and the water, right? This is a question that's bound to arise as California develops ways to reduce greenhouse gas emissions, and as the state wrestles with a water shortage that seems to grow more acute every week. I feel safe predicting that we won't build the Auburn Dam on the American River. It's a proposal that's too expensive ($3 billion? $6 billion?), too politically unpopular (the dam would flood a recreation that has more than 3 million visitors a year), and, well, too shaky (the dam would sit atop an earthquake fault). But proposals to create an "off stream" reservoir in western Colusa County and build a dam on the San Joaquin River above Friant Dam are very much alive. It's possible that climate change concerns could aid the cause of dam advocates, which demonstrates that climate change is far more than a simple environmental cause. – Paul Shigley

Denial of a conditional use permit renewal is a "project" requiring review under the California Environmental Quality Act, the Third District Court of Appeal has ruled. The court ruled for the owner of an airport in Sacramento County whose application for a conditional use permit (CUP) renewal was denied by the county Board of Supervisors without any environmental review. While the CEQA portion of the ruling is important for practitioners, the court also ruled that the State Aeronautics Act did not preclude the Board of Supervisors from closing the airport — a ruling that was a big victory for the county and local governments in general, and a potentially lethal blow to the airport. Operation of Sunset Skyranch Airport near Elk Grove has been the subject of extensive litigation since the early 1990s. Sacramento County first issued a two-year CUP for the airport in 1971, when the facility was little more than a dirt landing strip for a handful of crop dusters. Owner Daniel Lang never renewed the use permit, but he did dramatically improve and expand the facility. By the late 1980s, it was home to two paved runways, about 20 hangars, at least 60 airplanes, and an estimated 30,000 annual takeoffs and landings. In 1989, the county denied Lang a business license because he was out of compliance with the zoning ordinance, which required airports to have a CUP. In 1990, the county declined to issue a certificate of nonconforming use, resulting in an airport owner's lawsuit. In an unpublished 1993 decision, L ang v. Board of Zoning Appeals , No. C013642, the Third District ruled that the airport's expansion had ended its status as a conforming use and that Lang needed a CUP. Lang and Sunset Skyranch Pilots Association finally applied for a CUP in 1997, and in October 1999 the county approved a five-year CUP. A neighboring property owner sued over the negative declaration the county adopted for the CUP, but the Third District upheld the county's environmental review in Fat v. County of Sacramento , (2002) 97 Cal.App.4th 1270 (see CP&DR Legal Digest , June 2002 ). Days before the 1999 CUP was scheduled to expire, the pilots association applied for a renewal. The Planning Commission approved the renewal for two years with the understanding that no further extensions would be granted because urban development was encroaching on the airport. Representing area property owners, development consultants Taylor & Wiley appealed to the Board of Supervisors, which voted 4-1 to deny the CUP renewal. The board found continued use of the airport incompatible with new homes in the area and a proposed school, and determined other air facilities were available in the region. This time, Lang and the pilots association sued the county, arguing that the State Aeronautics Act (SAA) pre-empted the county's decision, and that the decision violated CEQA because the county conducted no environmental review before rejecting the application. Lang and the pilots also argued the county's decision was not supported by substantial evidence and that it was an unconstitutional taking of property. Sacramento County Superior Court Judge Jack Sapunor ruled for the county. A unanimous three-judge panel of the Third District Court of Appeal upheld all of the lower court's ruling except for the portion regarding CEQA. The county argued that no environmental review was required because CEQA Guidelines § 15270 states: "CEQA does not apply to projects which a public agency rejects or disapproves." But the court said the project here involved more than mere denial of an application. The project involved closure of an airport — something the county had vowed to enforce within 180 days, the court noted. The project had implications for the airport facilities and the pilots who use them. "We conclude the county's plan to enforce its zoning code, by ensuring the airport closure and transfer of pilots to other airports, are part of ‘the whole of the action' of the CUP denial, and the whole of the action has the potential for physical change in the environment," Justice Richard Sims wrote for the court. "Accordingly, the county's action constitutes a CEQA ‘project' requiring preparation of an initial study." Sims quickly pointed out that the court was not determining whether the project would have significant environmental effects or need a environmental impact report. "We merely hold the county has skipped an essential step," Sims wrote. The court rejected the arguments of the airport owner and pilots that the aeronautics act was contrary to and superceded the county's decision. They said the basis for the act was to protect the orderly expansion of airports and, therefore, required the county to permit continued operation of the facility. But the court said the SAA did not abridge the local police power. "The airport says we must look at the SAA as a whole," Sims wrote. "However, looking at the SAA as a whole, we do not see protection for airports against closure resulting from local land use zoning decisions." " he airport cites no specific SAA provision which is ‘contrary to' the county's denial," Sims added. " he SAA, as it stands, does not prevent the county from denying CUP renewal, even if it results in closure of the airport." In an unpublished portion of its opinion, the Third District rejected arguments that the county lacked substantial evidence for its decision, and the court ruled that the takings claim was not ripe for judicial review. The Case: Sunset Skyranch Pilots Associates v. County of Sacramento , No. C055224, 08 C.D.O.S. 8471, 2008 DJDAR 10193. Filed July 2, 2008. The Lawyers: For the pilots association: Lanny Winberry, (916) 386-4423. For the county: Krista Whitman, county counsel's office, (916) 874-5544. For real party in interest Taylor & Wiley, John Taylor, (916) 929-5545.