In a 30-page opinion originally filed July 3, and certified for publication on July 18, 2019, the Third District Court of Appeal affirmed the trial court’s judgment denying a writ petition challenging, on zoning law and CEQA grounds, the City of Sacramento’s approval of a high-rise infill housing project in its midtown area.  Sacramentans for Fair Planning v. City of Sacramento (2500 J Owners, LLC, Real Party in Interest) (2019) ___ Cal.App.5th ___.  The project, known as the Yamanee project, calls for construction of a mixed-use condominium building 15 stories (and 178-1/2-feet) high on a .44-acre site at the southeast corner of 25th and J streets.  It would total 177,032 square feet of space on the 19,200 square foot site, consisting of one floor of commercial uses, three levels of parking, one floor of resident amenities, and 10 floors containing 134 residential condominiums.

While the project’s floor area ratio (FAR) of 9.22 significantly exceeded the FAR restriction (of 0.3-3.0) and height recommendation (two to six stories) imposed under its “Urban Corridor Low” general plan designation, and its C-2-MC zoning’s height limitation (65 feet) and building intensity standards, the City approved it without a variance in reliance on a unique general plan provision (LU 1.1.10) that authorizes approval of projects not conforming to building intensity standards “if it is determined that the project provides a significant community benefit.”  The City found the Yamanee project met these criteria because it was a high quality infill project that would reduce personal vehicle dependency and carbon emissions while also advancing the City’s goal of building 10,000 new residential units in the downtown area by 2025.

On the CEQA side, the City found the project as mitigated would not have a significant environmental effect and that it qualified for streamlined environmental review under a sustainable communities environmental assessment (SCEA) (see Pub. Resources Code, § 21155.2(b)), rather than a traditional EIR or negative declaration.  The Court observed that “[a]n SCEA is a relatively new method [authorized by 2008 legislation known as SB 375] for conducting a streamlined environmental review for certain projects that assist the state in meeting its greenhouse gas [GHG] reduction targets.”

The bulk of the Court’s opinion is dedicated to discussion of the very interesting land use law issues unsuccessfully raised by the plaintiff’s lawsuit.  These included claims that the project approval (and the City’s unique general plan provision allowing it) violated zoning uniformity and implied-in-law “zoning contract” requirements allegedly applicable to charter cities (like Sacramento) under constitutional equal protection guarantees, and that the approval resulted from an unlawful delegation of legislative authority under vague and non-objective standards.  (I leave analysis of the Court’s detailed discussion and rejection of these and plaintiff’s other zoning and land use law arguments to my partner, Bryan Wenter, to cover in the Land Use Developments blog, and will only discuss the case’s two CEQA issues further here.)

The Court rejected plaintiff’s two CEQA challenges, which contended:  (1) the City couldn’t rely on a regional transportation and GHG emissions reduction plan to justify using an SCEA because the plan was inadequate to do so; and (2) the SCEA improperly tiered to prior EIRs to avoid analyzing the project’s cumulative impacts.  As brief background, SB 375 (the Sustainable Communities and Climate Protection Act) directed CARB to develop regional emission reduction targets for autos and light trucks, which metropolitan planning organizations (MPOs) – like the six-county SACOG covering Sacramento – must aim to achieve through preparation of regional transportation plans (RTPs), also called “metropolitan transportation plans” (MTPs), including a “sustainable communities strategy” (SCS).  The MTP/SCS directs the location and intensity of future land use development in the entire region to reduce motor vehicle GHGs, if feasible, in order to meet CARB’s targets through “‘smart growth’ planning” integrating a forecasted regional development pattern with the transportation network.  (See, Cleveland National Forest Foundation v. San Diego Assn. of Governments (2017) 3 Cal.5th 497, 506.)

Within SB 375’s scheme, “transit priority projects” like the Yamanee project play a key role.  Such projects contain at least 50% residential use, have a minimum density of 20 units per acre, and are located with one-half mile of a major transit stop or transit corridor.  (Pub. Resources Code, § 21155(b).)  To encourage such projects, streamlined CEQA review through an SCEA is authorized if (1) the project is consistent with the SCS’s “general use designation, density, building intensity, and applicable policies” for the area where it is located, and (2) the project incorporates all feasible mitigation measures, performance standards and criteria from prior EIRs that were adopted as findings.  The streamlining obviates discussion of growth-inducing impacts or project-specific or cumulative impacts on global warming or the regional transportation network from project-generated auto and light-duty truck trips.  Where the lead agency determines a prior applicable certified EIR has adequately addressed and mitigated a cumulative impact, the effect is treated as not cumulatively considerable and is not subject to further environmental review.  Finally, an SCEA need not analyze offsite alternatives or discuss any reduced-density alternative to address the effects of the project’s auto and light-duty truck trips.

Under SACOG’s applicable CARB-approved 2012 MTP/SCS, the Yamanee project is located in the central city subarea of a Center and Corridor Community typically designed for higher density, mixed uses as compared to surrounding areas.  The strategy notes the area’s capacity and plans to build new office, residential and mixed-use buildings exceeding four stories, and notes its potential to double existing central city housing by adding more than 54,000 new jobs and 27,000 new homes.  As the MTP/SCS’s policies are organized, projects consistent with its growth forecasts are per se consistent with its emissions policies.

The Court of Appeal upheld, as supported by substantial evidence, the City’s determination that the Yamanee project was a transit priority project consistent with the general land use designation, density, building intensity, and applicable policies specified in the MTP/SCS, and its consequent use of an SCEA to satisfy CEQA.  Plaintiff’s contentions that the MTP/SCS failed to identify “residential densities and building intensities within the region” as needed to enable project-specific mitigation lacked merit, and plaintiff misunderstood the SCS’s purpose, which was not to regulate land use through site-specific zoning (Gov. Code, § 65080(b)(2)(K)), but to establish a regional development pattern that if implemented will reduce future development’s GHG emissions.  SACOG’s region encompassed six counties (Sacramento, Placer, El Dorado, Yolo, Sutter, Yuba) and 22 cities, 4 million acres, and about 6,000 square miles, and nothing in SB 375 required it to establish building intensity standards with any more specificity than its CARB-approved MTP/SCS did.  Per the Court:  “SB 375 authorized the City to review the project in an SCEA if the project was consistent with the strategy.  There is no dispute that substantial evidence supports the City’s determination that the project was consistent with the strategy.”  The Court further stated that plaintiff’s concern about inadequate environmental review stemming from use of an SCEA was one “to take to the Legislature[,]” which it noted had “rational bases” to “exempt certain types of development from full environmental review” to help achieve State climate goals and other benefits.

The Court likewise summarily rejected the plaintiff’s argument that the City erred in relying on the prior general plan and MTP/SCS EIRs and an SCEA to avoid analyzing cumulative impacts “because no prior environmental analysis has ever considered the cumulative impacts of high-rise development in Midtown approved pursuant to general plan policy LU 1.1.10.”  CEQA authorized the City to rely on the prior reports as part of its streamlined review, the City’s initial study complied with CEQA’s statutory requirements for SCEAs, and plaintiff’s concerns about impacts over time on Midtown’s density and building intensity related to growth-inducing impacts specifically excluded from an SCEA’s scope.  Moreover, contrary to plaintiff’s arguments, the MTP/SCS EIR did consider on a regional basis the cumulative effects of building significantly more housing on the project side than allowed by the City’s zoning code since it “considered the cumulative effects of building over 300,000 new housing units in SACOG’s six-county area, including 27,000 new residential units in the central city, not just the 134 units this project would add.”

 

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 more than fifty years. For nearly all that time, the firm also has written Miller & Starr, California Real Estate 4th, 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, financing, common interest development, construction, management, eminent domain and inverse condemnation, title insurance, environmental law and land use. For more information, visit www.msrlegal.com.