Time for some “spring cleaning” updates on several notable CEQA-related matters.
Rehearing Denied and Opinion Modified In Kern County
Ministerial Oil And Gas Well Permitting Ordinance EIR Case
On March 20, 2020, the Fifth District Court of Appeal filed an Order modifying its Opinion and denying the requests for rehearing of respondents (Kern County) and real parties (WSPA and CIPA) in King and Gardner Farms, LLC v. County of Kern, et al. (2020) 45 Cal.App.5th 814; my March 3, 2020 post on the unmodified, partially-published, 150-page opinion can be found here.
The Court’s modifications did not change the judgment. They added text and analysis intended to support the Court’s choice of a remedy invalidating the County’s adoption of the ordinance and the ordinance itself effective 30 days after the opinion’s filing date. In addition to citing cases applying the “usual remedy” of complete invalidation of ordinances for CEQA violations, the Court stated that DOGGR could rely on permits issued by County before the invalidation date “without conducting an independent environmental assessment,” and also rejected arguments that its chosen remedy improperly accelerated its opinion’s finality since it could have invalidated all permits issued under the invalid ordinance. The Court also added language emphasizing that its characterization of the ordinance’s “primary purpose” as accelerating oil and gas development (and related economic benefits) was supported by County’s rejection of alternatives that served that purpose less effectively.
The Court further distinguished the case from POET I because the County’s EIR found the ordinance would result in significant unmitigated environmental effects (and County adopted a statement of overriding considerations), while whether the regulations at issue in POET I would cause significant increased NOx emissions was “uncertain.” In a footnote, the Court further justified its remedy by pointing out as a “general matter” that “if CEQA projects consisting of an ordinance or regulation were allowed to remain operational while the promulgating agency corrected the defects in its environmental analysis, the incentives to comply with CEQA before adopting an ordinance or regulation would be undermined, decision makers would not be fully informed before enacting measures, and leaving the measure in place would limit the consideration of alternatives and mitigation measures. [citations].”
The Court seemingly gratuitously referenced “the serious yet unresolved question about whether County’s issuance of permits involves the exercise of discretion” – indicating that the County may not have succeeded in drafting the ordinance in a manner that would achieve one of its major purposes. It will be interesting to see what the Supreme Court does with the petition(s) for review that will almost certainly be filed in this matter.
New Legislation Update
AB 1515 (Ch. 269) adds and repeals Government Code §§ 65458 – 65458.3, in an effort to encourage local agency updates of aging community plans and increased housing development by limiting available CEQA remedies in actions challenging such updated plans. The limitation applies where a community plan has not been updated for over 10 years and covers an urbanized area that includes two or more transit priority areas (see Pub. Resources Code, § 21099), and the agency has within the last 5 years adopted a general plan circulation or mobility element, has adopted a legally-compliant VMT threshold of significance, and has adopted any required fire hazard and flood plain regulations. Under these circumstances, in CEQA actions challenging the agency’s adoption of the community plan update, courts shall not based on CEQA noncompliance “invalidate, review, void, or set aside the approval of any development project” (as defined in Gov. Code, § 65928) that is approved before the court issues a stay or order or writ setting aside the community plan update or for which the application is deemed complete (per Gov. Code, § 65943) before such action. The new legislation applies to all cities, including charter cities, and sunsets on January 1, 2025.
AB 1485 (Ch. 663) amends Government Code § 65913.4, concerning ministerial or streamlined approval provisions for certain types of affordable housing, to extend CEQA exemptions for subsidizing such housing on government lands to BART, and to provide additional CEQA exemptions to state and local agencies and BART for approving improvements on the government agencies’ land that are needed to implement very low, low, or moderate income housing projects that receive ministerial or streamlined approval. Significantly, the bill would also provide that a development is consistent with objective planning standards for purposes of the housing law if there is substantial evidence that would allow a reasonable person to conclude that the development is consistent with the standards.
California Land Use Law & Policy Conference Postponed
On March 13, 2020, it was announced that, because of current uncertainty regarding travel and public assembly safety restrictions due to the COVID-19 virus, the 2020 California Land Use Law & Policy Conference previously scheduled for March 30, 2020, in Oakland, would be postponed until later in the year. It is anticipated that speaker line-ups will remain the same, and updated information on topics and timing will be provided in future updates from the conference sponsor, Argent Communications Group. I will look forward to participating as a speaker/panelist when the conference ultimately occurs.
Second District Affirms Judgment Denying CCP § 1021.5
Attorneys’ Fees Motion In CEQA Action
In an opinion filed February 19, and later ordered published on March 12, 2020, the Second District Court of Appeal (Division 4) affirmed the trial court’s judgment denying a motion made by a neighbor petitioner group under Code of Civil Procedure § 1021.5 for $289,544 in attorneys’ fees. The motion was made after real party Kuhn (appearing in propria persona) abandoned his plans to build his “dream house” – a modest single family residence – on an undeveloped hillside lot because he could not afford to defend the litigation, which challenged the County’s approval and issuance of a negative declaration for the project. The County vacated its approvals at real party’s request, and appellant then dismissed its action. Canyon Crest Conservancy v. County of Los Angeles, et al. (Stephen Kuhn, Real Party in Interest) (2020) 46 Cal.App.5th 398.
In affirming the trial court’s determination that appellant failed to establish a right to fees under the statute in these circumstances, the Court of Appeal held the trial court was within its discretion to conclude appellant’s action vindicated no “important right” where there was no evidence that “respondents would conduct any additional review or change their approach should Kuhn reapply for the project.” The Court distinguished cases where petitioners obtained vindication of important rights – such as preparation of an EIR for a project – through agreement despite the trial court making no determination on the merits. (Citing, e.g., Rich v. City of Benicia (1979) 98 Cal.App.3d 428, 431, 436.) Further, the Court stated: “Appellant’s suggestion that bringing a ‘viable CEQA claim’ alone is sufficient to satisfy this [important right] prong [of the statute] is unsupported by any authority and ignores the statutory requirement that a party not only allege an important right but actually vindicate that right by way of the litigation.” (Emph. in orig.) Per the Court: “Here, appellant has not demonstrated any abuse of discretion in the trial court’s practical assessment that the litigation did not serve to vindicate any of the rights under CEQA that appellant alleged were violated.”
The Court also disagreed with appellant that its action conferred a “significant benefit, whether pecuniary or nonpecuniary… on the general public or a large class of persons” by requiring the County to “reconsider the proposed project under CEQA.” The trial court’s early grant of an administrative stay was not a ruling on the merits, and no evidence suggested the action caused County to reconsider its CEQA review or change its position on oak woodland impacts, and residents’ statements to the contrary were speculative and unsubstantiated. The Court also noted the trial court’s finding that the “limited” nature of the project – “a less than 1,500-square-foot single family home on one lot” – supported the conclusion that the lawsuit conferred no significant benefit on the general public or a large class of persons.
Further on this point, the Court stated: “Although appellant raised a number of challenges to the environmental analysis of the project conducted by respondents, the lawsuit was dismissed without any agreement by respondents that they would reconsider the project in a different manner, or any order requiring them to do so. Respondents maintained that Kuhn could reapply for the project if he chose to and then respondents would proceed as they believed proper. Nor did respondents acknowledge any change in how they would approach similar projects in the future. . . . Moreover, Baer and the Lynches, as the creators and officers of appellant, admitted that their concern was the effect of the project on their personal [sic] property and, for the Lynches, on their ability to use Kuhn’s property for parking.”
Finally, the Court rejected appellant’s contention that its action resulted in a significant benefit by “creating an opportunity for members of the public to provide input” on the project as unsupported by the evidence, which included a record replete with public statements, both oral and written, during a permit approval process that included “opportunities to speak at multiple hearings.” Per the Court: “Appellant does not show how this lawsuit created any additional opportunities for input that were lacking, particularly where the lawsuit was dismissed and Kuhn ceased pursuing the project.”
The broad discretion conferred by CCP § 1021.5 on trial courts to award attorneys’ fees to successful parties in litigation that enforces important rights and achieves significant public benefits cuts both ways and, as illustrated by this case, is subject to abuse. Fees should not be awarded under a catalyst theory where an action stops a project by dint of expense rather than threat of victory on the merits. Given the inherent expense and uncertainty of CEQA litigation, which goes hand-in-glove with CCP § 1021.5 fee requests, the Legislature should seriously consider 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 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.