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CEQA Ruling Confounds Planners

Planning practitioners who are perplexed about how to handle certain projects in light of a recent court decision regarding the California Environmental Quality Act (CEQA) Guidelines should not feel alone. Planners, environmental consultants and attorneys who spoke with CP&DR presented a surprising lack of consensus about the effects of the Third District Court of Appeal ruling, which threw out six guidelines addressing cumulative impacts, thresholds of significance, tiering and probable future projects. Indeed, some practitioners conceded that they had received conflicting interpretations from lawyers and colleagues. What is clear is that almost no one has complete confidence about how to address a project's impact on a cumulative condition — an area of CEQA law that has long perplexed practitioners. The Third District ruled that "one molecule" of contribution to a cumulative condition was not enough to trigger an environmental impact report. The court also ruled that a lead agency cannot weigh incremental contributions as a ratio. Instead, the court pointed to an older CEQA Guideline, § 15064 subsection (i)(1). "[I]n assessing whether a cumulative effect requires an EIR, the lead agency shall consider whether the cumulative impact is significant and whether the proposed project's incremental effects are cumulatively considerable," Justice Rodney Davis wrote for the court. "The thing that struck me is that it's not the one-molecule rule," said Charlie Bull, president of RECON, a San Diego-based environmental consulting firm. "But based on what he wrote, it's hard for me to tell what the rule is." Added former Resources Agency counsel Maureen Gorsen, "Absolutely nobody knows what ‘cumulatively considerable' means." In late October, the appellate court invalidated several changes that the state made to the CEQA Guidelines in 1998. The court upheld one guideline addressing cumulative impacts but provided additional direction for interpreting the rule. The court also upheld an infill development exemption that environmentalists had contested (see CP&DR Legal Digest, December 2002). The decision has become known as the "CBE case" for the lead plaintiff, Oakland-based Citizens for a Better Environment. The decision is final because no one asked the state Supreme Court to review it. The ruling was a victory for environmental groups, which contended the amendments adopted during the final months of the Wilson administration were an attempt to hinder project opponents' ability to fight using CEQA. On the losing end of the CBE case was the building industry, which had taken up defense of the guidelines when the Davis administration and Attorney General Bill Lockyer backed away from the case. Builders said the guideline amendments brought a needed measure of certainty to environmental reviews. Today, about 150 guideline revisions from 1998 stand. But the few guidelines that the court invalidated were generally acknowledged to be the substantial changes. The cumulative impacts portion of the CBE case might be the most important. The court overturned a guideline that allowed planners to determine a project's contribution to a cumulative condition — such as air pollution — was "de minimis" and, therefore, not deserving of further study. The rejected guideline was intended to bridge the gap between "one molecule" of impact, and a "level of considerableness" that would trigger additional environmental review, said Terry Rivasplata, who headed the State Clearinghouse for the Office of Planning & Research (OPR) when the revisions were drafted. The court said the "one molecule rule" was not appropriate, but the court also ruled that comparisons and ratios were not the proper approach either. And the court indicated that the worse the cumulative condition, the more scrutiny a project should receive. "Therein lies the confusion," said Curtis Alling, managing principal of EDAW's Sacramento office. "If you don't do this from a comparative standpoint," said RECON's Bull, "I don't know how you do it." Alling suggested that planners either fully mitigate a project that contributes to a cumulative condition, or demonstrate that the project complies with an adopted plan that addresses the condition. "Maybe there's an encouragement to do broad-scale planning," he said. Rivasplata, now a CEQA compliance specialist for Jones & Stokes in Sacramento, agreed with that approach. If planners can show that a project is covered by an existing plan, program or mitigation fee, they might be able to avoid further study of cumulative impacts, he said. The appellate court did uphold a guideline that allows an agency to determine a project's incremental contribution to a cumulative effect is not significant if the project complies with an approved plan or mitigation program. However, the court ruled, the "fair argument" standard still applies, meaning an EIR would be required if there is substantial evidence a project may have a significant impact. That caveat is important because it reduces the certainty that guideline drafters sought, said Gorsen, the former Resources Agency counsel responsible for the 1998 amendments. The court rejected a guideline that required a finding of no significance if a project's impact fell below an established threshold of significance. But the court did not throw out the concept of thresholds of significance — a concept backed by developers and some planners. "This ruling does not mean environmental standards cannot be used as evidence to support significance determinations," according to an analysis by Morrison & Foerster attorneys Michael Zischke and Alicia Guerra. "It means that the standards cannot be given a presumptive effect that defeats the fair argument standard." The court invalidated a guideline that allowed a lead agency to approve a project without making findings of overriding considerations when the project is covered by a master or program EIR that found significant, unavoidable impacts. The court held that the public agency must adopt overriding findings every time. Many people read this part of the ruling as a requirement to prepare a second-tier EIR for any project covered by a master EIR with overriding considerations. But Alling, legislative director for the Association of Environmental Professionals, pointed out that the court did not explicitly say an EIR is required in such cases. Overriding considerations could be part of a negative declaration, he said, although he also called such an approach "very risky." The court upheld a guideline that provides a CEQA exemption for infill projects of less than five acres in urban areas if the project would not impact traffic, noise, air quality or water quality, and if the project complies with the general plan. While the exemption might appear too narrow to be of much use, some people see its value. "There are projects that get the go-ahead based on this," Rivasplata said. "But they may be small projects like a couple of units on one lot." Gorsen, now with Weston Benshoof, Rochefort, Rubalcava, MacCuish in Los Angeles, said some school projects could fall under this exemption. "So much of what they are doing is meeting class-size reduction mandates," she said. "They are not generating more trips or more students. So really the only impacts are construction impacts." Besides avoiding an EIR process that often lasts two years, school districts that use the exemption can also skip site assessments normally required by the Department of Toxic Substances Control, Gorsen said. The Resources Agency is following the formal administrative rulemaking process to erase the guidelines that the Third District struck. In the meantime, what should an agency that has relied on the now-invalid guidelines do? Rivasplata said that if the review period on an environmental document is complete, the lead agency should keep going. But if the agency can rework the document, it should, he urged. Last year, the Resources Agency and OPR completed a package of proposed guideline changes; however, officials held onto the proposal until the CBE case was decided. "Now that the court has ruled, we can move forward with a package of updates to the guidelines," said Terry Roberts, state clearinghouse director for OPR. Neither Roberts nor Resources Agency officials would say when the proposed revisions would be made public. Contacts: Terry Rivasplata, Jones & Stokes, (916) 737-3000. Curtis Alling, EDAW, (916) 414-5800. Charlie Bull, RECON, (619) 308-9333. Maureen Gorsen, Weston, Benshoof, Rochefort, Rubalcava, MacCuish, (213) 576-1000. Terry Roberts, Governor's Office of Planning and Research, (916) 445-0613.
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