California Senate Bill No. 122 (SB 122), introduced by Senators Jackson, Hill and Roth on January 15, 2015, appears to be the newest stab at legislative CEQA “reform.” But numerous of SB 122’s embryonic provisions raise questions as to whether this proposed curative measure might have some deleterious side effects.
In its current form, SB 122 would add a new section 21167.6.2 to the Public Resources Code, creating a detailed new alternative method for preparation of the “record of proceedings” – commonly known as the “administrative record”. If employed, the alternative would require record preparation “concurrently with the preparation of a negative declaration, mitigated negative declaration, EIR, or other environmental document for projects.” This “concurrent” procedure for record preparation beginning during the administrative proceedings and prior to any litigation differs from the traditional CEQA procedures for prompt post-litigation record preparation by the lead agency (at the plaintiff’s request) or the plaintiff (by its election), which are currently found in Public Resources Code § 21167.6(a)-(d). It is more in the mold of the expedited procedures for CEQA record preparation and litigation found in recent special legislation governing certain governor-certified or legislatively-favored “green” mega-development projects, although it could potentially apply to any size or type of project subject to CEQA. (See, e.g., “CEQA, Sausages, And The Art Of The Possible: A Closer Look At SB 743’s General CEQA Reform Provisions” by Arthur F. Coon and Matthew C. Henderson, posted September 16, 2013.)
In addition to the administrative record provisions (discussed in more detail below), the bill contains two uncodified “placeholder” sections which simply declare it is the Legislature’s “intent . . . to enact legislation” (1) “establishing an electronic database clearinghouse managed by [OPR] containing notices and documents required to be prepared [by CEQA]”; and (2) “establishing a public review period for a final environmental impact report prepared pursuant to, and relating to the record of proceedings for a project for which an environmental impact report is prepared pursuant to the [CEQA].” While obviously not yet fleshed out, the second of these statements of intent is troubling in that it contemplates injecting further public review requirements, attendant further delays, and (potentially) further lead agency obligations to respond in some manner to another round of public comments received on the final EIR – all after the close of the draft EIR public comment period and after responses to comments have been prepared and incorporated into the FEIR. How such new statutory requirements would mesh with CEQA’s currently well-developed statutory and case law rules governing responses to comments and circumstances requiring recirculation of draft EIRs, and why they are supposedly needed, is unclear. Further developments, hopefully illuminating the Legislative policy concern motivating this specific proposal, will undoubtedly be followed with interest by CEQA practitioners and consultants.
Turning to proposed new Section 21167.6.2, which is fully developed as a detailed proposed statute in SB 122, its key features (and my comments on them, as applicable) include:
- The alternative record preparation process would be triggered by (1) a written request of the project applicant, made not later than 30 days after the lead agency determines what type of CEQA document (EIR, MND, ND, etc.) to prepare, and (2) “consent” to the same by the lead agency within 10 business days at receipt.
- The lead agency’s time to respond to the applicant’s request could be extended by mutual written agreement, but not beyond commencement of the public review period on the draft CEQA document. The lead agency’s failure to respond within the initial 10 business days (or, if applicable, any extended response period) would be deemed a denial of the request, such that the alternative record preparation procedure would not apply.
- The applicant’s written request would be required to include an agreement to pay all the lead agency’s record preparation and certification costs (including the costs of complying with the new statute’s requirements) “in a manner specified by the lead agency.” The lead agency would be authorized to “charge and collect a reasonable fee” from the requesting applicant to recover such costs. Comment: The project applicant will probably be required to pay a steep price, up front, for the privileges of removing the record-preparation process from the potential control (and abuse) of project opponents and ensuring the existence of a statutorily complete and timely certified record for use in any subsequent CEQA litigation. For well-heeled project applicants with entrenched opponents who are likely to sue, this price may well be an acceptable trade off, although for some lead agencies – even with compensation – the new process may prove onerous and they may choose to “opt out” by withholding “consent.”
- The costs of the alternative record preparation process would not be recoverable in subsequent litigation challenging the project’s CEQA compliance, even if the lead agency and applicant were the prevailing parties. Comment: This is a change in existing law, which allows the recovery of record preparation costs reasonably incurred by the prevailing party litigant. The rationale appears to be that if you, as the project applicant, get the significant benefit of “control” of an expeditiously prepared and certified statutorily complete record, you should be happy with that and not expect your losing opponents to “foot the bill,” as they would under the “normal” litigation rules.
- Under the alternative record preparation procedure, the lead agency would be required to prepare the record “concurrently with the administrative process.” All documents and materials placed in the record would be posted on and downloadable from a lead agency-maintained Internet Website beginning with the date of the draft CEQA document’s release. If the agency can’t maintain its own website containing the record, it would be required to provide a link on its website to the information. Comment: Some lead agencies may find these requirements onerous and choose not to consent, but it they do consent the applicant will end up paying for them; it will be interesting to see where the League of California Cities and California State Association of Counties come out on this proposed legislation.
- The lead agency would be required to “make available to the public in a readily accessible electronic format the draft environmental document for the project, and all other documents submitted to, cited by, or relied on by the lead agency, in the preparation of the draft environmental document for the project.” Comment: As discussed further below, this language has broad and potentially problematic scope. As noted above, some lead agencies may also find these requirements onerous, but if the procedure is followed the applicant will ultimately be responsible to pay for them.
- Documents prepared by the lead agency or submitted by the applicant after release of the draft environmental document “that [are] a part of the record of proceedings shall be made available to the public in a readily accessible electronic format within five business days” of release or receipt. Comments: Again, some lead agencies may find these requirements onerous and may “opt out” by withholding “consent.” Additionally, this language raises “red flags” regarding whether noncompliance could possibly affect the substantive content of the record, i.e., resulting in the exclusion of documents not timely made available as required.
- The lead agency would be required to “encourage” submission of written comments in readily accessible electronic format, and required to “make any [such] comment available to the public in a readily accessible electronic format within five business days of its receipt.” The agency would have seven business days to convert and make publicly available comments received that are “not in an electronic format[:]” Comment: Again, some lead agencies may find these requirements onerous, but if the agency consents to the request the applicant will ultimately foot the bill.
- The lead agency would be required to certify the administrative record within 30 days after its filing of a notice of determination (NOD) (or possibly a notice of exemption (NOE), given the statute’s current imprecise drafting), although other provisions make this result appear unintended) for the project. Comments: Having a statutorily complete record certified as of the deadline for filing CEQA litigation would likely expedite resolution of the litigation by months, which would be a significant benefit for project proponents facing litigation.
- The content of the record would be required to be as specified in Public Resources Code § 21167.6(e), i.e., what court decisions have recently referred to as a “statutorily complete record.” Disputes regarding the record would be resolved by the court in CEQA actions brought under Public Resources Code § 21167(b) or (c), i.e., challenges to EIRs, MNDs, or NDs. Comments: The requirement for a statutorily complete record will normally be a significant benefit to lead agencies and project applicants whose project approvals are later challenged in litigation, since an under-inclusive record (often strategically prepared that way when project opponents are in control) is presumptively prejudicial to those defending the project. The drafting of this proposed statutory subdivision, when compared to the imprecise wording of a previous subdivision, raises the question whether administrative records for projects determined to be CEQA-exempt are ever intended to be governed by this statute. The likely answer is “no,” but if this is the case then the statute’s drafting should be cleaned up to make this intent clear.
- The proposed law would expressly state it “does not require the disclosure or posting of any trade secret as defined in Section 6254.7 of the Government Code, information about the location of archeological sites or sacred lands, or any other information that is subject to the disclosure restrictions of Section 6254 of the Government Code.” Comment: Given the proposed statute’s broad earlier language regarding documents required to be made publicly available, this subdivision raises red flags about the privileged or “non-record” status of administrative draft documents and common interest privileged documents, and in my opinion, should be made more explicit with regard to whether or not the Legislative intends to change existing law governing these subjects. Arguably, it does not, based on the provision discussed above that content is governed by existing § 21167.6(e), but that should be made clear.
- EIRs, NDs and MNDs would be required to include a notice in at least 12-point type, as specified, indicating the document is subject to § 21167.6.2. Comment: This is another indication that the proposed statute is not intended to govern records for exempt projects, but, again, that intent should be made clearer by revising earlier language in the statute that might be read overbroadly to suggest a contrary conclusion.
In sum, SB 122 potentially offers significant advantages – as well as some foreseeable disadvantages – in attempting to provide an expedited record preparation alternative controlled by the lead agency and project applicant and potentially available for all types of projects subject to CEQA. If drafted appropriately, this part of the proposed statute could effect potentially significant litigation reform in cases where the alternative procedure is employed. However, SB 122’s expressed intent to provide another public review period applicable to Final EIRs appears unwarranted and goes in the opposite direction of CEQA reform.
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 www.msrlegal.com.