Transportation costs associated with a community are a good predictor of housing foreclosure rates, according to a new study commissioned by the Natural Resources Defense Council (NRDC). The peer-reviewed statistical analysis found that, after accounting for variable factors, foreclosure rates in automobile-dependent fringe neighborhoods are higher than in "location efficient" neighborhoods in which residents spend less of their income on transportation, according to the NRDC. The study looked at 40,000 mortgages in the San Francisco, Chicago and Jacksonville, Florida, regions. "In all three cities, the study found statistically sound results that the probability of mortgage foreclosure increases as neighborhood vehicle ownership levels rise, after controlling for income," a briefing paper on the study says. The problem, according Jennifer Henry, of the NRDC's Chicago office, is that people who must drive everywhere "have much less economic flexibility" in difficult economic times. The NRDC makes three recommendations based on the findings: Land use, infrastructure and transportation policy should encourage development of location-efficient communities; mortgage underwriting practices should favor purchases of location-efficient homes; lenders and researchers should perform further research to refine underwriting models. A briefing paper about the study is available on the NRDC website, www.nrdc.org/energy/10012001.asp . The NRDC publicized its study at the same time the Congress for New Urbanism (CNU) stepped up its campaign to reform Fannie Mae and Freddie Mac lending standards. According to CNU, the government-backed mortgage agencies will not finance developments that have more than 20% commercial use, meaning mixed-use project developers and buyers do not have access to Fannie and Freddie loans. "Fannie Mae and Freddie Mac enforce rules that have made Main Street almost impossible to build in America," complained CNU President and CEO John Norquist. He pointed to the 2008 study produced by CEOs for Cities called "Driven to the Brink" that strongly suggested high gasoline prices helped pop the housing bubble because exurban commuters could no longer afford both their mortgage and their gas bills. Norquist and other CNU leaders want Congress and the Obama administration to encourage lending programs that favor walkable, location-efficient development.

Last Wednesday afternoon, I arrived in Seattle and checked into a room on the 16th floor of the Hyatt At Olive 8 hotel and began preparing to moderate a panel the next day on transferrable development rights programs. The hotel was brand-new and less than a block from the convention center. It was comfortable and cool, the first LEED certified hotel in Seattle. Little did I realize that the very room I was staying in existed because of the King County transfer of development rights program I was there to discuss. TDR programs, as you may know, allow developers in "receiving areas" -- usually cities -- to increase density by purchasing the development rights of landowners in "sending areas" -- usually rural areas -- whose land has been designated for preservation. Our panel Thursday at the New Partners for Smart Growth was focused on TDR programs in the Seattle area -- including the King County TDR program , which is run by Darren Greve, who used to work with me at Solimar Research Group . The panel -- which also included Skip Swenson of the Cascade Land Conservancy and Ivan Miller of the Puget Sound Regional Council -- was an excellent overview of TDR programs in the Puget Sound area, and the questions from the audiences were unusually sophisticated and on-point. And about halfway through the panel, I realized that my hotel room had been created as a result of the King County TDR program. I bring this up not just because it's kind of a fun thing to write about, but because it goes to one of the central questions about TDRs raised during the panel: How do you get developers, cities, and people in the receiving areas to accept additional density? It's definitely a variation on the old notion of "what's in it for me?" Why should anybody in a receiving area be willing to accept additional density in order to preserve land a long way away? This is a question that Darren Greve, in particular, has been pondering a lot, because part of his job is to negotiate "interlocal agreements' with cities in King County to accept higher-density development through TDRs. In his presentation, Darren suggested several possibliities -- all of them compelling. The first is that cities that accept TDRs may be able to lower the region's carbon footprint -- important if that's a reiognal policy goal. Darren showed a slide suggesting that a condo in a receiving area has less than half the carbon footprint than a single-family home on a five-acre lot. The savings are not just from less driving, but also from less home energy use. The second is that it might be possible to link TDRs to urban redevelopment goals. For example, currently cities in Washington cannot use tax-increment financing. There's a bill in the state legislature right now to allow use of TIF -- but only if TDRs are also used. The third -- similar to the second -- is the use of what are called "amenity funds." Sometimes it's possible to peel off enough money from the TDR system to give the receiving area money to improve neighborhood amenities. The last one is the most intangible -- but possibly also the most powerful, and the one I thought about when I got back to my room at the Hyatt at Olive 8 that night. That's the sense of satisfaction you get from helping to accomplish a goal that conforms to your basic values. One of the reasons that TDR programs work in the Seattle area is that even the most urban dwellers do not feel removed from the rural environment. around them. Even if they walk or ride transit during the week, they love to get out and collide hard with nature on the weekends. So saving land far aware isn't an abstraction. It's real. During our panel, Darren said that the Olive 8 condo/hotel tower had gotten 30% more height because of TDRs (I was on the second-to-higest floor) and that one TDR from rural King County -- that is, removing the ability to build one house on a five-acre lot -- bought 2,000 additional square feet in the Olive 8 tower. That means every six or seven rooms on the upper floors of the Hyatt at Olive 8 preserved one five-acre lot in eastern King County from being mini-mansioned by a Microsoft millionaire. Maybe they should have put a plaque in every room: "This room preserved a half-acre of rural land in eastern King County." Hmmm. Not a bad idea. I'm suggesting it as part of the next TDR program I work on. – Bill Fulton

There's an old joke that what the locals fear more than a federal government in disarray is a federal government that has its act together. Well, now the joke's being put to the test. At the plenary session of the New Partners for Smart Growth conference in Seattle the other night, President's Obama's so-called Green Cabinet -- Transportation Secretary Ray LaHood, HUD Secretary Shaun Donovan, and EPA Assistant Administrator Mathy Stanislaus, filling in for his boss Lisa Jackson -- presented the most cohesive vision of federal involvement in planning and development since the Johnson Administration 40 years ago. "When it comes to housing, transportation, and environmental policy, it's time the federal government spoke with one voice," HUD Secertary Donovan said at the plenary. The coordinated federal effort would have vast reach and billions of dollars in resources if it is successful. It takes at least three forms -- the creation of special offices on sustainable communities inside each of the three agencies; the addition or continuation of funding programs inside each agency; and an unusual level of coordination among the agencies on the sustainable communities effort. At the plenary session Thursday night, HUD Secretary Donovan said that the fundamental problem to be attacked is "the fundamental mismatch between where we work and where we live." He also said the federal government would not try to create a top-down solution to the problem."This is not about telling localities how to do it, but about offering them resources and tools to help them realize their own vision, "Donovan said. Each of the three announced or reaffirmed that their agency will be creating an office focusing on sustainabile and/or livable communities. These are: • As expected, HUD will create an Office of Sustainable Housing and Communities , overseen by Deputy Secretary Ron Sims, formerly King County executive in Seattle, and run by Shelley Poticha, formerly head of the Center for Transit-Oriented Development in the Bay Area and also a veteran of Calthorpe Associates. • DOT will create an Office of Livable Communities and has proposed a $527 million budget for livable communities programs in the next federal budget. • EPA's current Office of Smart Growth will be combined with other functions and morph into an Office of Sustainable Communities/ The major brainpower for the coordinated effort would appear to be located in HUD -- an unlikely place for policy innovation in recent administrations. Donovan, the former New York City housing commissioner, is viewed as one of the Obama Administration's brightest starts, whereas La Hood's appointment as DOT secretary was greeted with disappointed from smart growth advocates last year. As an elected local official, Sims implemented many of the most far-reaching smart growth efforts in the nation, and Poticha has been on the cutting edge of transit-oriented development policy efforts in the Bay Area. In addition, Donovan selected Rafael Bostic from the University of Southern California's School of Planning Policy & Development as his Assistant Secretary for Policy Development and Research . This office within HUD has always been influential in federal policy, and Bostic is considered one of the nation's brightest young planning and housing researchers. (Full disclosure: I teach part-time in the same school as Bostic.) Both La Hood and Donovan have repeatedly said they will seek to use their entire departmental budgets to promote sustainable communities. However, direct federal funding for these programs is increasing rapidly. In addition to La Hood's $527 million budget request, Donovan announced Thursday night a new $150 million sustainable communities planning grant program . EPA's Stanislaus announced that the three agencies had selected five cities as national sustainable communities pilots . The only city in California on the list was National City, south of San Diego. – Bill Fulton

According to walkscore.com , I work in a walker's paradise. The walkscore of our office in Ventura, California, is 95. I also live in a pretty good walking environment. My duplex has a walkscore of 78—and that's way better than the walkscore in the cavernous suburban house I used to live in, which was 3. So, what's all that worth? The answer is something. Your walkscore now shows up on Zillow.com and Ziprealty.com when somebody checks out your house. Recent real estate research has found that houses with high walkscores command a price premium, all other things being equal. The permutations are endless – as we learned this afternoon at the New Partners for Smart Growth conference in Seattle. At a panel this afternoon, Matt Lerner, the Chief Technology Officer of Front Seat – creator of walkscore.com – was one of several folks who talked about how walkscore is affecting real estate markets and planning processes. Not only does your walkscore show up on Zillow and Ziprealty now, real estate agents in urban areas are using high walkscores in ads. The clear implication is that walkability is a selling point – and walkscore.com is pushing the idea more and more. "Our whole theory of change with walkscore is that people who otherwise wouldn't care about walking or transit are hungry for information for real estate." Lerner said. "This is a way to talk to them in way that will affect their future carbon footprint and their health." He noted that, other than LEED, "there are no smart growth metrics in the real estate listings." He said walkscore is adding transit accessibility, roadway networks and "real" walking routes (rather than as-the-crow-flies), and provides its data to any researcher who wants to use it. In particular, he said, walkscore plans to add road width, road speed, and density of intersections as measurements of connectivity, not just distance. Lerner also said walkscore can be used over time, to show which neighborhoods are getting more walkable and which are getting less walkable. It's also possible to use walkscore on planning projects. Harriet Tregoning, planning director for the District of Columbia, said she is using walkability as a metric in neighborhood planning – and said that even re-planning of Edge City employment centers such as Tysons Corners (which, by the way, has a walkscore of 80) can use walkscore as a way to measure outcomes. Tregoning said walkscore holds great potential as a way to inform discussions about plans. "Everybody wants all that stuff walking distance to their house," she said. "It's hard to explain that at four units per acre you're not going to get it, and that vast parking lots won't get it for you either. Walkscore is a way to show the you have to have enough people and enough foot traffic to get it." A number of questioners asked whether walkscore was going to move toward the idea of "placescore." Lerner said they were considering it and had even thought about creating a "Jane Jacobs score" by converting Jacobs' criteria for vibrant neighborhoods into an algorithm. But, he said, "It starts to feel a little more political because we'd be saying to people, your neighborhood isn't healthy. Walkscore is more objective. Some realtors tell us their clients like a low walkscore because it's the get-away-from-it-all score." – Bill Fulton

Winters – one of the most charming towns in the Central Valley – is considering whether to accept the town's first franchise fast-food outlet. I almost never take sides in these things, but I'm hoping the city's leaders say no to the proposed Burger King. It wasn't too long ago that Winters was little more than a struggling Yolo County farm town. In recent years, though, civic leaders, property owners and merchants have revitalized the downtown. It's now a lively community center that features galleries and boutiques for visitors, shops and services oriented to locals, and enough variety in restaurants and watering holes to satisfy just about everybody. Winters even snagged The Palms several years back, when the venerable live music venue relocated from Davis. When we rated small city downtowns in the Central Valley two years ago, we listed Winters in the "others of note" section. If I could do that list over again, I'd place Winters and Exeter in the top tier, and I'd bump Lodi down a notch or two. (When we compiled our list, downtown Lodi seemed on the verge of really big things, almost none of which have come together.) You'd never know anything about the rise of Winters as a vibrant town if all you did was drive through on the I-505 freeway, which is a shortcut for people driving to and from the Bay Area. Except for a lone gas station at the offramp, Winters has no presence on I-505, even though the city limits extend to the freeway. If you want to grab something to eat or a decent cup of coffee, you've got to get off the freeway, drive a short distance into town and then – gasp! – get out of your car and walk into a non-franchise operation. A few years ago, I wrote about how swell it is for people like me – who need strong coffee for frequent long-distance drives – that so many towns have an instantly identifiable Starbucks. But I still believe that having the same darn Starbucks store everywhere is bad for people who actually live in those towns. For some reason, Winters has escaped this phenomenon. Yes, the town does have a Subway, a Roundtable and a Pizza Factory. But it doesn't have the usual array of franchise boxes and parking lots jammed against the freeway ramps. That sets Winters apart in the Central Valley. Of course, cities can't pay police officers or pave streets with charm. Cities need actual money, and that's one of the biggest arguments for the Burger King/76 gas station (Eat here, get gas!) project proposed by Singh's Foodservice. A busy stop on the interstate can produce meaningful revenue for a small town such as Winters. And having freeway ramps full of franchise offerings doesn't necessarily toll the death bell for a downtown. Our favorite Central Valley small city downtown is nearby Woodland, whose I-5 freeway ramps offer all the usual McFood. Still, Winters feels a little fragile. If the drive-through burger joint/gas station is the start of a new freeway-oriented commercial district, the implications for the rest of town are not good. Such is the nature of "fiscalized" land use planning. Revenue needs often trump long-term community building. Sounds like a decision on the Burger King is still a little ways off. If Winters says no, I promise I'll do my part by finding my way to Steady Eddy's for a sandwich and cup of coffee the next time I'm driving down I-505. We'll all be better off. - Paul Shigley

UCLA Extension's annual Land Use Law and Planning Conference is typically a demilitarized zone. Combative environmentalists and builders usually check their weapons at the door, and a civil discussion about legislation, litigation, and regulation ensues. Not so last Friday during the 24th annual event at the Biltmore in downtown Los Angeles. Blame the economy, but something close to open warfare erupted over stormwater runoff between Mark Gold, president of the Heal the Bay, and Andrew Henderson, general counsel of the Building Industry Association of Southern California. On top of that, the keynote speaker – Ed Blakely, former dean of the planning school at the University of Southern California and recovery czar in New Orleans – warned that there may not be enough market to sop up the growth that we are planning. The stormwater panel was billed as an educational session on understanding the alphabet-soup regulation of low-impact development, which is now mandated under new stormwater rules in both Orange County and the Los Angeles/Ventura County area. Adam Fischer of the Santa Ana Regional Water Quality Control Board made some progress in the explanation. He noted that under the Orange County permit, the regional board now has more authority to go after developers, whereas the agency's only previous recourse was to go after cities. But when Gold and Henderson began to mix it up, explanations were left in the dust. The two quickly began to square off over the nature of stormwater regulations and, in particular, whether numerical limits on runoff pollution should be implemented. "Does anybody think we are doing a good job on stormwater runoff?" Gold asked at the beginning of his presentation. "Did anyone see the beaches after the storms last week? They pretty much looked like a trash dump." He did acknowledge that water quality is handled well during the dry season, when runoff systems (natural and man-made) can handle the load, but not during heavy rains. Henderson responded by attempting to counter with common sense: "My suspicion is Native Americans thousands of years ago probably wouldn't go swimming in the ocean right after the rain because there'd be a lot of pollution." Henderson and Gold then got into a rhetorical battle over standards for trash, which wasn't all that hard to follow but did stray somewhat from the goal of informing the audience. Blakely, who is now based at the University of Sydney, in Australia, painted a somewhat bleak picture of the future of Western countries if their economies are based on the notion of growth among large middle-class families. "When I lived in Pasadena," he said, "I had a six-bedroom house. Thank God I sold that. Who is going to buy our homes? My children aren't. They're married or in long-term relationships, but they are not planning on four or five kids. In fact, they haven't yet produced one!" Blakely noted that New Orleans, five years after Hurricane Katrina, still has 40,000 abandoned homes. As a solution, Blakely strayed from traditional planning topics. He argued for better education of immigrant families so they are more upwardly mobile, and for more savings and investment so that economic growth would not rely so much on population growth. – Bill Fulton

The largest development project ever approved in Amador County might also become the first project in the county to be decided by voters in a referendum. With 1,334 housing units, 300 time-share units, a golf course resort and a commercial area, Gold Rush Ranch would approximately double the size of the City of Sutter Creek. Project opponents say the project is simply too big, and they fear Gold Rush Ranch could mark the start of extensive suburban-style development in an area that has been relatively slow to grow. "It's the beginning of another Elk Grove," said Bart Weatherly, a leader of Preserve Historic Sutter Creek and of the referendum effort. "Elk Grove is not Sutter Creek. Sutter Creek is a quaint little Gold Rush town surrounded by rolling hills and oak woodlands." On the other hand, Mayor Gary Wooten does not see Gold Rush Ranch as the beginning of the end for Sutter Creek. "This is a tremendous project," Wooten said. "It's not going to effect the historic preservation. The downtown is going to stay old. You won't even be able to see it from downtown. We're still going to be the small jewel of the Motherlode." Even if Gold Rush Ranch is not the precursor to a development trend, the project is a substantial one in sparsely populated Amador County. During the last decade Amador County as a whole grew less than 1% annually to about 38,000 people, including about 5,000 who reside at Mule Creek prison in Ione. Sutter Creek grew at roughly 1.5% annually to 2,700 people. That's about 15 new housing units a year. Gold Rush Ranch would blow those numbers away. Several years ago, the nearby City of Jackson approved an approximately 900-unit project. Opponents qualified a referendum for the ballot, and the City Council, at the request of the developer, rescinded project approvals. After more than two years of review, the Sutter Creek City Council approved a specific plan and certified an environmental impact report for Gold Rush Ranch in January. But the project has even more history. In 2004, the city approved a golf course, 56-room hotel and 300 time-share units (called "interval-ownership vacation units") on about 600 acres of newly annexed land to the west of the city. The project never went forward, however, and new developers – including Bill Bunch of El Dorado Hills and John Telishak of Corte Madera, and calling themselves Gold Rush Ranch, LLC – entered the picture. They bought the 600-acre project site as well as an adjacent 20,000-acre ranch. The land is generally foothills woodlands and pasture, with some surface mines. In July 2007, the new developers filed an application for the Gold Rush Ranch project, which kicked off an extensive review process, explained Anders Hauge, of Hauge Brueck Associates in Sacramento, who serves as Sutter Creek's contract planner. "This Planning Commission and City Council had never processed such a large project, and they were unsure how to proceed. We spent a lot of time comparing the project with every goal and objective in the general plan," Hauge said. "The point I tried to get across to the Planning Commission and the City Council is, if you don't want this, what do you want? Say what's acceptable." The Planning Commission conducted no fewer than 27 meetings at which it examined general plan consistency, developed conditions of approval, and made recommendations regarding the specific plan and development agreement, according to Hauge. The City Council then began its own review in mid-2009 and, over the developers' objections, accepted all of the Planning Commissions' recommendations. In January, the council voted 4-1 to approve the project. Even dissenting Councilman Tim Murphy endorsed the project. He said he voted against the specific plan only because he does not believe it is feasible and developers will end up requesting amendments. Although the city approved the number of units originally proposed by developers, Hauge and Mayor Wooten insist the project evolved considerably during the city's review. The city required a great deal of up-front infrastructure, including about $6 million worth of off-site road work, rejected the developer's mass-grading plan and instead required a more site-sensitive approach, and required the planting of two new oak trees for every one removed. While the developer originally proposed only residences in the first phase, the city is requiring the hotel, the golf course, half of the time-share units and about 50,000 square feet of commercial development in the first of four phases in order to generate economic activity. In addition, 10% of units must be affordable to moderate-income households, and market-rate builders must pay a fee into an affordable housing fund. The affordable housing conditions are firsts for Sutter Creek, according to Hauge. Wooten said the project contains attractive features. About 300 acres of the 945-acre site will remain public open space with a multi-use trail system. Development is proposed in individual villages rather than spread across one massive subdivision. The city will get property for two parks and a police station/fire house. Land also will be set aside for a school and a library. The golf course, hotel, time-share homes and nearly 60,000 square feet of commercial space will generate revenue and about 230 permanent jobs, Wooten said. The new visitors and residents will also boost a struggling commercial area in adjacent, unincorporated are between Sutter Creek and Jackson, he added. Housing would be developed in a collection of villages separated by the golf course and open space. Still, opponents argue the project is out of scale. Chris Wright, executive director of the Pine Grove-based Foothill Conservancy, said the city should have insisted on a much smaller project. "If you look at the basic principles of smart growth, it does make some sense to have growth there, adjacent to the existing city. But the scope here is too big," Wright said. "It's your basic golf course-style resort development." Weatherly, the initiative proponent, said the city did a very good job of reviewing and conditioning the project. The city's only mistake was not insisting on a smaller development similar to the original 2004 project, which, he said, won approval without opposition. There is no need for the number of units in Gold Rush Ranch, added Weatherly, who noted Sutter Creek already has about 600 vacant, buildable lots. Wooten questioned whether opponents would be willing to support even a smaller project. "There's a lot of people who don't want one more house built in Amador County," he said. To force a referendum election, project opponents have until February 3 to submit about 160 signatures of registered voters. While Foothill Conservancy's Wright said voters would overwhelmingly reject the project, Wooten predicted voters would endorse the project if they get the chance. The funding and market for the project remain uncertain in many people's minds. Wooten said he expects build-out to take a full 20 years, with retirees and commuters to Sacramento and Stockton – both of which are about an hour away via two-lane highways – buying new homes. Opponents say building houses 50 miles from job centers makes no sense economically or environmentally. Gold Rush Ranch representatives declined to speak with CP&DR . Hauge noted that about 110 acres of the site had long been zoned for industrial uses, and high-density housing is permitted in that zone. As many as 1,600 apartments could have been developed with very little city discretion, he said. Instead, the city has exercised extraordinary discretion over Gold Rush Ranch and will continue to review the project as the developer proposes detailed subdivision maps. Contacts: City of Sutter Creek: (209) 267-5647. Anders Hauge, Hauge Brueck Associates, (916) 283-5800. Chris Wright, Foothill Conservancy, (209) 295-4900. Gold Rush Ranch city documents: http://web.me.com/suttercreek/City_of_Sutter_Creek/Home.html . Gold Rush Ranch LLC: www.goldrushranch.com . Project opponents' website: www.nogoldrush.com .

The Schwarzenegger administration's proposed state budget for the 2010-11 fiscal year promises more of the same, as the spending plan mostly mirrors the current year's version in regards to local government funding, infrastructure and land conservation. The spending plan provides no money for local transit, offers no subventions to counties for implementing the Williamson Act agricultural land conservation program, and again tries to eliminate the Governor's Office of Planning and Research (OPR). The governor has also resurrected a proposal for additional offshore oil drilling leases in the Santa Barbara Channel, with the $100 million in annual lease revenues funding state park operations.  The state budget will be the dominant issue in Sacramento during the 2010 legislative year, just as it was during 2009. A number of legislative priorities have already been washed away amid the red ink. State Senate President Pro Tempore Darrell Steinberg (D-Sacramento) is limiting senators to eight bills this year, rather than the typical 20. Steinberg himself pulled the plug on his SB 500, which would have established a permanent funding source for affordable housing. Although the governor has not formally proposed taking additional revenues from cities, counties or redevelopment agencies, rumors persist that a new $2 billion shift away from redevelopment agencies is in the works. The state is facing a shortfall of about $20 billion for the current and next fiscal year. The administration proposes to bridge the gap partly by getting the federal government to provide an additional $6.9 billion and to allow the state to divert $1 billion in federal money designated for elderly and disabled people to other programs. Thus far, Congress and the Obama administration have been cool to the state's pleas. In a budget analysis, the state Legislative Analyst's Office (LAO) said, "While the odds seem favorable for some federal relief sought by the administration, we believe that the likelihood of Washington agreeing to all of the governor's requests is almost non–existent." Under one proposal, the state would eliminate the 5% (temporarily 6%) sales tax on gasoline and add 10.8 cents per gallon to the existing 18-cent gasoline excise tax. This proposal would do two things: It would eliminate a dedicated funding source for transit capital development and operations, saving the state $1.5 billion. Second, because the gas sales tax goes into the general fund but excise tax revenues flow to a special fund, the state's Proposition 98 obligation to schools (which is based on the general fund) would be reduced. The proposal appears to be a direct reaction to a court ruling last year in which the Third District Court of Appeal held that the state had to pay back about $1.2 billion it diverted from transit agencies during the 2007-08 fiscal year. Although the state has continued the diversion in years since, the court ruled that Proposition 42 and Proposition 1A from 2006 protect the revenues for transit purposes. League of California Cities Executive Director Chris McKenzie said the governor would "destabilize local infrastructure funding." Plus, he noted, the state just last year attempted to take $1 billion in gas excise tax revenue that was legally dedicated to local governments for road maintenance. "This is just the kind of Byzantine proposal that we've seen from the state over and over again in recent years that erodes voter confidence in state government," McKenzie said. Although the California Transit Association is fighting the governor's plan vigorously, spokesman Jeff Wagner noted, "This proposal exists only as a proposal advanced by the governor. It is, frankly, hard for us to see how the leadership in the Legislature will accept this when it results in a net decrease in revenues for the short-term." In addition, the governor would shift money currently available for highway expansion into maintenance and rehabilitation accounts, according to the LAO, which suggests increasing the gas tax. On a different front, the governor has proposed continuing the elimination of subventions to counties that implement the Williamson Act, which provides tax breaks to agricultural landowners who agree not to develop their land for at least 10 years (see CP&DR , August 15, 2009 ). Since lawmakers approved that plan last summer, a number of counties have stopped enrolling new properties in the land conservation program. Also like last year, the governor has proposed eliminating OPR. That plan went nowhere last year because lawmakers declined to approve legislation to shift statutory duties to other agencies. Still, the governor has revived the issue. Department of Finance language is murky, but OPR's duties would apparently be handed to the Natural Resources Agencies and the Department of Housing and Community Development.  The oil-drilling-for-parks proposal may be the most intriguing idea contained in the governor's budget. One year ago, the State Lands Commission voted 2-1 against allowing Plains Exploration and Production Company (PDX) to tap the Tranquillon Ridge Field off the Santa Barbara County coast. Although state law prohibits new oil drilling in state waters, PDX proposed slant drilling from an existing oil platform to reach Tranquillon Ridge. The drilling would provide the state with about $1.8 billion over 14 years, including $100 million up front. In addition, PDX in 2008 cut a deal with local environmental groups in which the oil company agreed to shut down three other platforms in the area and to donate 3,900 acres to the Trust for Public Land. The groups, including the influential, Santa Barbara-based Environmental Defense Center, agreed to endorse the drilling. Schwarzenegger attempted to go around the State Lands Commission – composed of the lieutenant governor, the controller and the finance director – last year, but lawmakers refused to cooperate. Since then, John Garamendi resigned as lieutenant governor after winning a seat in Congress, and Schwarzenegger nominated Republican state Sen. Abel Maldonado to be lieutenant governor. Assuming Controller John Chiang maintains his opposition to the PDX project, Maldonado could be the swing vote. However, Maldonado is from Santa Maria, and oil drilling is controversial along the Central Coast. He voted against the project last year. While many state and national environmental organizations oppose the oil drilling, they also oppose Schwarzenegger's state parks closures and cutbacks. Schwarzenegger now proposes to use $140 million of the oil drilling revenues for parks during the 2010-11 fiscal year and to continue dedicating the revenue to parks. The LAO has urged lawmakers to take action on a spending and revenue plan by the end of March because time will be needed to enact proposals and to get measures related to social services and education spending on the June ballot. In the meantime, advocacy groups are working on their own ballot measures. The League of California Cities, the California Redevelopment Association and the California Transit Association are gathering signatures on a measure that would add further protections to local government, redevelopment, transportation, and transit revenues. A group called Conservation Strategy Group supports a measure that would add $18 to vehicle registration fees, with the revenue designated for state parks in exchange for free access to state parks. Numerous other measures are circulating that would require reassessment of commercial properties, reduce the two-thirds vote required in the Legislature for the budget, and otherwise alter how the state makes budget decisions. Resources: Legislative Analyst's Office: www.lao.ca.gov . Governor's proposed budget: www.ebudget.ca.gov . California Transit Association: www.caltransit.org . Secretary of State's initiative and referendum list: www.sos.ca.gov/elections/ballot-measures/initiative-referendum-status.htm .

Many California cities and counties are wrestling with flood waters these days, but, perhaps more importantly, they are also wrestling with revised flood risk maps issued by the Federal Emergency Management Agency. The new maps have raised the consternation of local government officials, homeowners and developers in numerous locales, and in a few places the new maps are forcing reconsideration of growth plans. Federal officials offer few apologies and say they are simply following the orders of Congress, which directed FEMA to revisit flood maps in the wake of the Hurricane Katrina disaster. In fact, the federal remapping may be only the beginning of flood headaches for the Central Valley in particular. While FEMA is concerned with 100-year flood protection, 2007 state legislation pegs the standard of protection in the Central Valley at 200 years and, starting in 2015, prohibits development in areas lacking 200-year protection unless agencies prove they are taking steps to provide 200-year protection (see CP&DR, October 2007 ). It's difficult to generalize regarding the FEMA remapping program because cities and counties are so different. Some local officials praise FEMA for considering local concerns, while others complain of a heavy federal hand in the remapping process. The local governments are also responding very differently to the new maps, with some digging in their heels and others rounding up money for improvements. One primary issue is this: If a city or county cannot show that a flood-control levee is "certified" by the Army Corps of Engineers, FEMA flood maps assume the levee does not exist. That was the case in the City of Chico, where a new FEMA risk map placed a substantial portion of the city in the 100-year floodplain. If the map were to stand, thousands of property owners would have to buy flood insurance, and new development would have to meet a variety of potentially expensive standards. The levees in question, along Sycamore and Mud creeks, were actually built by the Army Corps during the 1960s. They are owned by state Department of Water Resources (DWR) and maintained by Butte County. However, "It's mostly our citizens who are protected by the levees," Chico Building and Development Services Director Fritz McKinley said. "The city is taking the lead in this process." The process has been mostly bureaucratic, not physical. It involves compiling the Army Corps' as-built drawings, county maintenance records, and new DWR testing data. Last June, the city and Butte County signed a "provisionally accredited levee" (PAL) agreement with FEMA, and the city has about one more year to convince the federal agency that the levees are sufficient. McKinley said the episode has had little impact on planning or development because building has been very slow lately. "It does educate the public that they are living in an area protected by a levee," conceded McKinley. That education is a goal of both Congress and the state Legislature. South of Chico in Yuba County, residents are well aware they live in an area reliant on levees, as Yuba County experienced disastrous floods during 1997, 1986, 1964, 1955 and 1950. The 1986 flood in the unincorporated communities of Linda and Olivehurst was the subject of the Paterno decision, in which the court ruled the state was liable for more then $400 million in property damage because of inadequate levee maintenance (see CP&DR , March 2005 ; CP&DR Legal Digest , January 2004 ). In addition, the county's largest growth area - Plumas Lake, located south of Marysville - has flooded several times. However, Community Development Director Kevin Mallen contended Yuba County is actually a flood control success story. Thanks to impact fees from builders in Plumas Lake, property assessments and about $150 million in state bond funds, Yuba County is on track to complete a $400 million levee upgrade program later this year (see CP&DR Deals , December 2006 ). The program's central component is construction of about 30 miles of new levee along the Feather and Yuba rivers. The new structures replace 100-year-old levees built from mining tailings and native material. "We started our levee improvement program in 2004," Mallen said. "We're now in a position where we are going to have our certification package to FEMA by April." He expects the final FEMA risk maps to identify a few new small stream hazards, but the county's populated areas will have 100-year flood protection. In addition, a general plan update will emphasize the critical nature of flood control in Yuba County, he said. "It's not just building levees, it's maintaining them." While Yuba County's program for the east banks of the Feather River is nearing completion, Yuba City and Sutter County are still trying to figure out how to pay for about $200 million in needed improvements to the river's west bank levees. Virtually all of Sutter County, including Yuba City, lies in FEMA's revised 100-year floodplain, although flood maps for only the southern portion of the county are final. Still, until levee improvements are made, virtually all new building and most remodeling will have to meet expensive requirements, such as raised building pads, second-story living spaces and stem wall construction. Residents in Sutter County are scheduled to vote on property assessments later this year to raise about $80 million for levee improvements. Farther south in San Joaquin County, FEMA identified "large areas of Stockton, a small area of Lodi and unincorporated areas of the county that are in the urban envelope" as being in the floodplain, said Connie Cochran, of the Stockton city manager's office. The initial risk maps had the potential to nearly shut down development in a broad area. However, the city, the county and several reclamation districts that own levees worked closely with FEMA for several years to refine the maps. In the end, about 3,800 parcels, mostly in Stockton's older Smith Canal neighborhood, were added to the floodplain, as well as some properties, mostly agricultural, in unincorporated San Joaquin County. The bigger issue is the provisionally accredited status of levees protecting about 40,000 structures in Stockton, Lathrop, Manteca and the unincorporated communities of Weston Ranch and Brookside. The cities and county concede the levees in question do not meet Army Corps of Engineers design standards and are applying for $76 million in state grants to upgrade the levees. The situation threatens to slow development and redevelopment. The revised FEMA maps are not impacting only the Central Valley. In Ventura County, for example, FEMA identified six uncertified levees that protect portions of Ventura, Oxnard, Camarillo and Simi Valley. In Oxnard, a half-mile-long gap in a Santa Clara River levee threatened to halt development at the city's 700-acre RiverPark project (see CP&DR Places , April 2005 ). Oxnard officials, however, convinced FEMA to delay final map adoption because of erroneous topographic elevations. The 2 1/2-year delay gives Oxnard time to figure out how to pay for about $75 million in needed levee improvements, according to Rob Roshanian, Oxnard building and engineering services director. "The way FEMA is doing the maps, they are not very accurate. People in D.C. are doing the maps for Oxnard," Roshanian complained. "They don't even have good topographic maps to work with." Above the Central Valley, Calaveras County officials are dealing with the implications of new flood maps that place some of the Valley Springs area in the 100-year floodplain from Cosgrove Creek. "There is a lot of development pressure in that area because there is some infrastructure around there," said David Pastizzo, a planner for the county. "There are several subdivisions being reviewed in the planning department right now." He could not say how the new flood maps will affect those proposals, but he warned that the maps could complicate a new community plan that has been in the works for several years. Meanwhile, according to Chico's McKinley, the FEMA remapping serves as "kind of a precursor" to the more arduous 200-year flood requirement forthcoming for the Central Valley. Like many jurisdictions, Chico may need money for flood control improvements and increased maintenance to meet the mandate.  Contacts: Fritz McKinley, Chico Building and Development Services Department, (530) 879-6900. Kevin Mallen, Yuba County Community Development Department, (530) 749-5430. Rob Roshanian, Oxnard Building and Engineering Services Department, (805) 385-7893. David Pastizzo, Calaveras County Planning Department, (209) 754-6394. San Joaquin County flood information: www.co.san-joaquin.ca.us/pubworks/flood_info.htm . Ventura County Watershed Protection District: www.vcwatershed.com/levee/index.html . Flood & Thunderstorm Preparedness Guide: What To Do Before, During and After: http://ammo.com/articles/how-to-prepare-for-a-flood .

The Town of Tiburon has lost another round in its ongoing litigation with property owners over assessments to fund the undergrounding of utility lines. Under Proposition 218 (California Constitution article XIII D), special assessments shall not "exceed the reasonable cost of the proportional special benefit conferred on a parcel." The courts have divided this into two general inquiries: (1) Is a special benefit conferred by the improvement to be built through the assessment? (2) Is the assessment proportional? In Town of Tiburon v. Bonander , the First District Court of Appeal answered yes to the first question, but found that Tiburon's division of costs for the undergrounding project was not proportional under Proposition 218. This case involved the imposition of a supplemental special assessment for undergrounding utility lines. The saga began when the original special assessment was imposed, and certain landowners sued. That case is still pending before the court after the state Supreme Court issued a procedural ruling permitting the property owners to challenge the original assessment ( Bonander v. Town of Tiburon , (2009) 46 Cal.4th 646; see CP&DR Legal Digest, July 1, 2009 ). After imposing the original assessment, the Town of Tiburon discovered that the costs of undergrounding utilities were higher than anticipated and a supplemental special assessment was necessary. The voters within the district approved the supplemental assessment, and the town brought a validation action requesting that the court declare the assessment valid. Jimmie Bonander and other landowners within the district ("appellants") filed an answer to the validation action, thereby opposing it. The trial court found in favor of the town and declared the supplement assessment valid. The landowners appealed. The appellate court addressed three questions: (1) Should the record regarding the original assessment be included in the judicial record before the court on the supplemental assessment? (2) Did the town properly identify special benefits that would be conferred by undergrounding the utilities? (3) Did the supplemental assessment satisfy the proportionality requirement under Proposition 218? In the end, the court invalidated the supplemental assessment because the costs were not divided proportionally based upon the relative benefit the properties received as required by Proposition 218. The methodology used to determine the supplemental assessment was the exact methodology used to determine the original assessment. The same calculations and benefit apportionment applied. Therefore, the court held that information regarding the original assessment was properly before the court in evaluating the validity of the supplemental assessment. The court next addressed the special benefits conferred. The town identified three special benefits conferred on the properties within the district: improved aesthetics, safety and reliability. Appellants argued that these benefits either had no connection to undergrounding the utilities or these were general and not special benefits because they were conferred on everyone within the district. The court disagreed. The court found that each benefit was "tied to individual properties based on proximity to existing overhead utility lines." The court also emphasized that the mere fact that the majority of properties within the district received a special benefit did "not compel the conclusion the benefit is not tied to particular properties." Therefore, the town properly identified special benefits that would be conferred on the properties within the district. The town evaluated each property within the district and assigned points under each special benefit category. For example, if the property would only benefit aesthetically, it would receive one point. The points would then determine the assessment amount. In addition to the special benefit points, there was one other factor that determined the assessment amount. The town divided the district into three "benefit zones" based on the construction costs for undergrounding utilities in each of the zones. For example, a property in the Hacienda Drive area that received three benefit points would pay $20,331.24, whereas a property in the West Hawthorne Drive area that received three benefit points would pay $7,740. Appellants argued that this methodology violated the proportionality requirement of Proposition 218. The appellate court agreed. The court stated: "The benefit zones have nothing to do with differential benefits among the three zones but instead are better characterized as ‘cost zones'…" When evaluating proportionality, an assessment should reflect "costs allocated according to relative benefit received." It cannot be based strictly on the construction costs associated with undergrounding the utilities on a particular property. The town had to take the total construction costs across the entire district and apportion them based on the number of benefits assigned. One property that received three benefit points should pay the same as another property receiving the same three benefit points, the court determined. The court did point out that, as in Dahms v. Downtown Pomona Property & Business Improvement District , (2009) 174 Cal.App.4th 708 (see CP&DR Legal Digest , July 1, 2009 ), the town could have assigned benefit points based on "building size, street frontage, and lot size."  However, in this case, the town chose aesthetics, safety and reliability as the three special benefits and did not factor in the size of the lots. The court also found that the town excluded from the assessment district certain properties that also received the special benefits. If properties are located outside the district benefit, the cost cannot be imposed on properties within the district. This violates Proposition 218's requirement of not exceeding the reasonable cost of the proportional special benefit. Therefore, the town violated the proportionality requirement by dividing the district into "cost zones" and excluding certain properties that would receive a benefit. This case clarifies that the construction costs must be viewed as a whole and divided equally by the relative benefit conferred on the properties. This case also illustrates the importance of identifying special benefits. Tiburon could have avoided this outcome had it determined the amount of special benefits conferred based on lot size or some other relevant factor. The Case: Town of Tiburon v. Bonander , No. A119918, 2010 DJDAR 43. Filed December 31, 2009. The Lawyers: For the town: Ann Danforth, town attorney, (415) 435-7370. For Bonander: Frank Mulberg, (415) 388-0605.

A state appellate court has upheld the adoption of design guidelines that are intended to implement a City of Los Angeles redevelopment plan. PR/JSM Rivara LLC v. Community Redevelopment Agency of the City of Los Angeles involves adoption by the Community Redevelopment Agency of the City of Los Angeles, and the city (collectively, the "city") of design guidelines for the North Hollywood redevelopment project area in September 2007. A developer in the project area, PR/JSM Rivara challenged the guidelines on the grounds the guidelines illegally reduced the maximum allowable densities in the commercial portion of the project area. In other words, the developers claimed their property was down zoned. The developers also argued the city improperly rezoned the properties without complying with the Planning and Zoning Law. Clearly, the developers' interest in this case was preserving their right to build at densities contained in the city's zoning ordinance. The trial court denied the developers relief, finding that the densities within the project area were set years ago when the redevelopment plan was amended in 1997. Thus, the time to challenge those densities had long expired. The lower court also rejected the argument that the design guidelines acted as a de facto amendment to the zoning code. The Second District Court of Appeal upheld the lower court's ruling. In doing so, the Second District first gave an overview of redevelopment law. The court explained why the adopted guidelines are not a zoning ordinance within the Planning and Zoning Law, and emphasized the difference between adopting a redevelopment plan (a legislative act) and implementing one (an administrative act). If the guidelines were found to be a zoning ordinance, then the Planning and Zoning Law requires public notice and a hearing prior to adoption. While redevelopment law also requires certain procedures for adopting or amending a redevelopment plan, the court found that there were no provisions in either redevelopment law or the Planning and Zoning Law that required public notice and a hearing prior to the administrative act of implementing a redevelopment plan. Because the guidelines were merely implementing the plan, public notice and a hearing were not required prior to adoption. The court further determined the developers had not provided any evidence as to how the guidelines were inconsistent with the city's general plan – despite the court's admission that developer had demonstrated that provisions of the guidelines and general plan were different with respect to certain land uses. In rejecting the developers' contention that the guidelines conflicted with the state's density bonus law, the court paid particular attention to the declaration of the city's regional administrator. She averred that the discretionary density bonus plan in the guidelines would not interfere with the state law. In addition, the court said that developers could not point to contrary evidence. The court further noted that because the city's municipal code allows a redevelopment plan to contain a base density lower than the maximum allowable residential density under the zoning code, the developers failed to prove they were entitled to the density set by the zoning code. Finally, the court hammered the proverbial nail in the coffin on this issue when it found that the decision to impose the density regulations was completed in 1997, when the redevelopment plan was amended. Thus, the statute of limitations to challenge density expired a decade earlier. Lastly, the court held the developer's California Environmental Quality Act (CEQA) claims were time-barred. In doing so, the court held that, contrary to developers' contentions, the notice of determination filed by the city on October 26, 2007, was sufficient. The statute of limitations for filing a CEQA claim expired on November 25, 2007. The developers did not file their lawsuit until the following month. The Case: PR/JSM Rivara, LLC v. Community Redevelopment Agency of the City of Los Angeles , No. B213051, 2010 DJDAR 622. Filed December 17, 2009. Ordered published January 13, 2010. The Lawyers: For PR/JSM Rivara: Matthew Hinks, Jeffer, Mangels, Butler & Marmaro, (310) 203-8080. For the city: Deborah Fox, Meyers, Nave, Riback, Silver & Wilson, (213) 626-2906.

For a second time, the Bay Area Air Quality Management District (BAAQMD) has postponed adoption of California Environmental Quality Act (CEQA) thresholds of significance for greenhouse gas emissions. The district board delayed a decision until April in the face of ongoing opposition to the thresholds from local governments and some environmentalists, who argue the standards could have unintended consequences. The thresholds of significance are intended to guide cities and counties as they review the potential impact of land use projects, stationary sources of pollution and general plans under CEQA. The air district has intentionally proposed quite strict project thresholds. For example, the typical 55-house subdivision or 77-unit condominium project would generate enough greenhouse gas (GHG) emissions for GHG to be considered a potentially significant impact; therefore, the project would need an environmental impact report. Planners in Berkeley, Oakland, San Francisco and other cities argue that the thresholds are not adequately location-sensitive and could require that desirable infill and redevelopment projects undergo an EIR, rather than a faster and cheaper level of environmental review. The planners also question whether the thresholds would apply to infill projects that otherwise qualify for exemption from CEQA. The planners as well as development representatives and some environmentalists say the air district should ensure streamlined review of infill proposals. Other environmentalists and the attorney general's office, meanwhile, have endorsed the thresholds. Air district staff members argue the thresholds are location-sensitive because infill projects close to transit and a mix of land uses would generate fewer GHG emissions than automobile-dependent subdivisions on the fringe. They also say that a project that complies with a city or county climate action plan (many of which are being prepared) could be afforded a "presumption of insignificance" and, therefore, proceed without an EIR. The BAAQMD would be the first air district in the state to adopt thresholds of significance for greenhouse gas emissions. The proposed thresholds and background documents are available on the district website .