Environmental review of a 109-unit subdivision on a 900-acre parcel in Carmel Valley was inadequate, the Sixth District Court of Appeal has ruled. The court concluded that in overturning the Monterey County Planning Commission's decision to deny the project, the Board of Supervisors used information about the project's water supply that had been introduced at the end of the environmental review process and had not been sufficiently analyzed or reviewed by the public.

The environmental impact report for the proposed September Ranch project concluded that water demand for the originally proposed project (which called for 117 residences) estimated annual water usage of 61.15 acre-feet per year, or 16.15 acre-feet more than the estimated existing usage of 45 acre-feet per year. The 45 acre-feet figure was based on an estimate of 2 acre-feet apiece for 21 irrigated pastures, plus 3 acre-feet used by an existing equestrian center and residence.

In the comment period, the county health department concluded that fewer acres had historically been irrigated as pastureland. However, the final EIR concluded that no historical data on water use existed and stuck with the 45 acre-foot estimate. A supplemental EIR dealt with other water issues, including the ranch's assertion that it held riparian rights. Following the release of the supplemental EIR, the applicants announced they had purchased a 10-acre parcel (the "Berube" parcel) that contained the right to pump approximately 32 acre-feet of water per year from the property.

In 1998, the county's Land Use Advisory Committee recommended denial, claiming the project did not comply with the county's water supply policies. The committee gave the project a failing score (44%) in the category of water/hydrology. Later that year, the Planning Commission rejected the project, in part because of the water issues, but did approve a smaller project of 56 units. The Planning Commission rejected the EIR's methodology of estimating water use and instead used the September Ranch's records for water use for 1997, which revealed that 26 acre-feet had been pumped for irrigation (plus 52 acre-feet for aquifer testing). The commission approved the smaller project based on this lower estimate of water usage. However, the applicants viewed the smaller project as economically infeasible.

After the Planning Commission action, the environmental consultants submitted "supplemental information and errata," which relied on documented water use to conclude that average use for 1993 to 1999 was 30 acre-feet per year. But that usage had grown to 51 acre-feet per year in the period 1997 to 1999. Based on this information and the availability of water from the Berube property, the county staff recommended that the Board of Supervisors revise the project's failing water/hydrology score.

In late 1998, the board voted 3-2 to approve the project at 109 units, selecting 51 acre-feet of water per year as the base year figure. Environmentalists sued and Monterey County Superior Court Judge Richard Silver ruled against the county, concluding, among other things, that the board's findings about baseline water supply were not supported by substantial evidence and that the EIR should have considered the environmental effects of using an offsite water supply.

The September Ranch developers appeal revolved around the question of what the county should have used as its baseline water figure. The developers argued that this question is "a matter of policy" to be resolved by the county — especially because the record contained several different estimates and records, each of which could have been used as a baseline. Environmentalists countered that the baseline environmental conditions should be determined by the EIR itself.

The appellate court found some merit in both positions but ultimately ruled in favor of the environmentalists. First, the court questioned whether the property had actually been used as irrigated pastureland — the assumption that underlay the EIR's estimate of water usage — noting that there was no objective evidence but merely the assertion of the applicant that this was so. Second, the court noted that the water pumping numbers grew dramatically during the years after the application was failed. "By inviting the board to pick from an array of numbers to determine an important aspect of the baseline environmental setting, the EIR failed to fulfill its function of providing information and analysis of environmental impacts," the court wrote.

Finally, the court said, the county erred in basing its decision on information that emerged late in the environmental review process. The court noted that the project was pending for 3 1/2 years, a period during which the applicants controlled the pumping rate.

"The better approach … would be to follow the general rule expressed in the [CEQA] Guidelines and cases that baseline conditions are normally to be determined at the time environmental review is begun," the court ruled. "An EIR in which a baseline water use determination is elastic and can be modified by the Board at the end of the environmental review process without benefit of analysis or public participation" is a violation of CEQA.

The Cases:

Save Our Peninsula Committee v. Monterey County, No. H020900, and Sierra Club v. County of Monterey, No. H020933.

The Lawyers:

For September Ranch Partners:Stephen Kostka, McCutchen, Doyle, Brown & Enerson, (925) 937-8000.

For Save Our Peninsula Committee: Alexander Henson, (831) 626-8686.

For Sierra Club: Frances Farina, (831) 625-5544.