In a lengthy, 65-page opinion filed December 8, 2014 (of which fully two-thirds was unpublished), the Fifth District Court of Appeal affirmed the Fresno County Superior Court’s judgment upholding the EIR, Conditional Use Permit (CUP), and reclamation plan approvals for the Carmelita Mine and Reclamation Project, an aggregate mining and processing operation proposed to be located at a 1,500-acre site 15 miles east of Fresno.  Friends of the Kings River v. County of Fresno (Colony Land Company, L.P., and Carmelita Resources, LLC, RPI) (5th Dist. 2014) 232 Cal.App.4th 105.  The project contemplates extraction of 1.25 million tons of aggregate per year, from 22 individual mining cells of about 40 acres each, over a period of up to 100 years, with mining and subsequent reclamation activities to proceed on a cell-by-cell basis.

The published portions of the opinion dealt with:  (1) the State Mining and Geology Board’s (SMGB) legal powers in dealing with administrative appeals (known as “designation appeals”) of  local agency reclamation plan approvals under the Surface Mining and Reclamation Act of 1975 (“SMARA”); and (2) CEQA’s rules governing mitigation of a project’s direct farmland loss impacts.  Key points from the published portions of the decision include:

  • SMARA (Pub. Resources Code §§ 2710, et seq.) is a “home rule” statutory scheme reposing primary responsibility for enforcing the law’s requirements – including approvals of the surface mining reclamation plans and financial assurances that lie at the heart of SMARA – in local lead agencies (such as the County of Fresno in this case).
  • While the SMGB is statutorily authorized to hear designation appeals from permits to conduct surface mining activities in an area of statewide or regional significance, and may review such local lead agency decisions under the substantial evidence standard, if it finds the decision is unsupported by substantial evidence, its only statutory authority is to remand the appeal back to the lead agency for a new public hearing and reconsideration – the SMGB may not invalidate or set aside the challenged permit or reclamation plan approval.  (Also, under certain circumstances where a lead agency fails to fulfill its SMARA duties, the SMGB may step in and take over as the lead agency, although this power does not extend to permitting authority and was not exercised in this case.)
  • As relevant to the instant case, these SMARA rules meant that petitioner’s successful designation appeal to the SMGB during the pendency of its writ of mandate litigation challenging the County’s CEQA review of the project did not have the effect of invaliding the challenged reclamation plan or rendering the CEQA action moot.  Administrative agencies have only such powers as expressly or impliedly conferred on them by constitution or statute; here, the SMGB’s statutory authority extended only to requiring a remand and reconsideration of approvals it found unsupported by substantial evidence, not to setting aside or nullifying those approvals.
  • Turning to the CEQA issues, the Court upheld the EIR’s findings and mitigation measures with respect to the Project’s impacts involving permanent loss of almost 600 acres of farmland that would occur over the course of the next 100 years.  The County adopted three mitigation measures recommended in the EIR for the project’s farmland conversion impacts, found that “conversion of farmland to another land use remains a significant and unavoidable impact” even after the mitigation, and declined to require the project proponent to mitigate by means of permanent agricultural conservation easements (ACEs) at preservation ratios of between 1:1 and 2:1, as some EIR commenters urged it to do.
  • The County’s adopted mitigation measures (which were upheld by the Court as constituting an adequate mitigation effort under CEQA, notwithstanding the lack of required ACEs) were:  (1) the project site’s current agricultural use would continue until the land is prepared for mining; (2) 602 acres within the project site outside disturbed areas would continue to be maintained as an agricultural buffer for the life of the CUP; and (3) the applicant would reclaim the mine cells to farmland as adequate soil materials are generated to fill the empty cells.     The EIR thus included specific measures that were feasible to mitigate or compensate for the loss of farmland caused by the Project – albeit only partially and not to the extent of reducing impacts to a less-than-significant level.  While, as required by CEQA, County evaluated ACEs as a possible mitigation measure, along with the ultimately required measures, it was not required to do more.
  • Petitioner’s contrary position misplaced reliance on Masonite Corp. v. County of Mendocino (2013) 218 Cal.App.4th 230, 238.  (For a prior post on that case, see “First District Publishes Significant CEQA Decision On Legal Feasibility Of Mitigation For Prime Farmland Losses In Masonite Corporation v. County of Mendocino,” by Arthur F. Coon, posted August 2, 2013). Masonite held “ACEs may appropriately mitigate the direct loss of farmland when a project converts agricultural land to a nonagricultural use” and “that the lead agency in that case erred by failing to consider ACEs as a potential mitigation measure for [such] direct loss.”  As further explained by the Fifth District Court of Appeal:  “We do not read Masonite … to stand for the proposition that CEQA requires the use of ACEs as a mitigation measure in every case where ACEs are economically feasible and the project causes the loss of farmland.  In Masonite, the lead agency did not believe ACEs were applicable and apparently did not adopt any mitigation measures to address the loss of farmland caused by the project.  Here, in contrast, [Fresno] County did not “categorically exclude ACEs as a means to mitigate the conversion of farmland” ….  Rather, County considered the use of ACEs along with other mitigation measures and selected the three mitigation measures recommended in the DEIR.  We decline to hold that County was required to adopt ACEs as a mitigation measure instead of the mitigation measures it did adopt.”  (The Court went on to reject Petitioner’s argument that County failed to provide reasoned responses to comments on the same topic.)

The published potion of the Court’s decision provides useful guidance and clarification of relevant provisions of SMARA and CEQA case law in the context of surface mining and quarry projects involving the conversion of agricultural lands – a common scenario.  It clarifies the powers the SMGB does – and does not – have with regard to administratively appealed approvals.  Significantly, it also makes clear that while CEQA requires that ACEs must be “evaluated” as possible mitigation for direct farmland losses, they are not a required (or even necessarily preferred) form of mitigation even if they would not be economically infeasible for the project proponent to obtain or provide.  Rather, the lead agency retains discretion to select mitigation measures it deems most appropriate, after fully considering and evaluating all available options.  This remains true in the not-uncommon context where direct farmland loss impacts will remain significant and unavoidable regardless of the type of mitigation required.

Questions?  Please contact Arthur F. Coon of Miller Starr Regalia.  Miller Starr Regalia has had a well-established reputation as a leading real estate law firm for fifty years.  For nearly all that time, the firm also has written Miller & Starr, California Real Estate 3d, a 12-volume treatise on California real estate law.  “The Book” is the most widely used and judicially recognized real estate treatise in California and is cited by practicing attorneys and courts throughout the state.  The firm has expertise in all real property matters, including full-service litigation and dispute resolution services, transactions, acquisitions, dispositions, leasing, construction, management, title insurance, environmental law, and redevelopment and land use.  For more information, visit