Authored Articles & Publications May 23, 2018

CEQA – Today and Tomorrow

Legal Decisions and Pending Guideline Updates Have Effect on the CEQA Review Process Write BB&K Attorneys Charity Schiller and Amanda Daams in PublicCEO

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By Charity Schiller and Amanda Daams

Changes to the California Environmental Quality Act are on the horizon.

According to the Governor’s Office of Planning and Research, the changes “consist of refinements and clarifications of existing requirements.” Several of the proposed changes are also focused on furthering efforts to account for and reduce greenhouse gas emissions in response to Senate 743 (from 2013), which required a CEQA update to address transportation impacts.

With major changes to CEQA looming, we take a look at the law’s regulatory requirements, notable proposed updates and how a recent court trend toward increased disclosure will impact how agencies complete the CEQA review and entitlement processes moving forward.

Fundamentals of CEQA
California’s leading environmental law, CEQA, was adopted in 1970 with the goal of protecting the environment while furthering public disclosure. The law requires that state and local agencies identify the significant environmental impacts of their actions and mitigate those impacts whenever possible.

When initiating the CEQA process, agencies can start by asking these three questions:

1. Is it a “project?” A project is a discretionary approval by a California public agency that may result in direct or reasonably foreseeable indirect environmental impacts. If the action doesn’t qualify as a project, then the action is not subject to CEQA. If it is a project:

2. Is it exempt? Exemptions can be statutory (those granted by the Legislature) or categorical (classes of projects that have been determined to not have effects on the environment). Projects can also fall within the common sense exemption (where it can be seen with certainty that no possibility of a significant impact on the environment exists). If the project is not exempt:

3. What level of CEQA review is needed? There are many options depending on a project’s circumstances. The most common routes are a negative declaration (when there is no substantial evidence supporting a fair argument that the project will have significant environmental impacts), mitigated negative declaration (where the potential impacts can be mitigated to a level of less than significant) or an environmental impact report (where there is substantial evidence supporting a fair argument that a project will have significant impacts). Subsequent and supplemental EIRs, addenda, subsequent MNDs and other options may also be appropriate.

The Overhaul: CEQA 2.0
The OPR released a proposed, comprehensive update to the CEQA Guidelines in November.

While not yet adopted, these changes are moving through the formal rule-making process and will likely become law later this year. With that in mind, agencies should take note of the proposed guidelines and what their eventual adoption may mean in terms of CEQA compliance in the future.

The proposed guidelines update includes many minor modifications and clarifications, but also captures several major changes that would require agencies to analyze various environmental impacts — from water supply to transportation — with a greater level of detail. It also interprets the authority already held by courts to fashion equitable remedies when CEQA violations are found.

1. Thresholds of Significance: Changes to Guidelines sections 15064(b)(2) and 15064.7(d)would increase the emphasis placed on thresholds of significance. Agencies would be encouraged to explain, with substantial evidence, why a threshold was selected and how compliance with that set threshold means a project’s impacts are less than significant.

2. Water Supply: Updates to Guidelines section 15155 (f) would require agencies to consider water supply with a degree of certainty throughout the project’s lifespan. Agencies would also be required to evaluate the pros and cons of a project based on water demand and evaluate potential supply alternatives if water supply cannot be determined for the life of a project.

3. Remedies on Remand: New Guidelines section 15234 would elaborate on the courts’ existing authority to void or partially void project approval using equitable powers. The rule would also confirm that agencies can continue project activities during a remand period under certain circumstances.

4. Appendix G: The Initial Study Checklist includes many proposed changes that would eliminate duplicative questions (though the issues will still need to be analyzed), reorganize issues, make minor clarifications and add two new categories for impact analysis:

  • Energy: The proposal would require agencies to expressly consider a project’s construction and operational energy usage as part of the Initial Study checklist process for all projects. This is a change from the existing Appendix F energy analysis, which focuses on EIRs.
  • Wildfire Impacts: The proposal would also require agencies to expressly consider a project’s potential impacts to wildfire hazard impacts. While general wildfire hazards would still be considered as part of an agency’s hazards analysis, more specific impacts related to wildfire impacts would be evaluated in its own category of impact.
 

5. Transportation: Proposed new Guidelines section 16064.3 and changes to Appendix G would present a major policy-based paradigm shift from analyzing transportation impacts based on Levels of Service to vehicle miles traveled. As with other types of CEQA impacts, the shift would require agencies to establish, and support, a VMT threshold with substantial evidence. However, the mandatory application of the VMT, rather than LOS, approach would not take effect until Jan. 1, 2020.

Courts Weigh-in on CEQA
CEQA is a self-executing statute requiring direct compliance by public agencies. Therefore, perceived violations of CEQA are often enforced through citizen-suit litigation.

Although the legal standard of review limits court review of an agency’s fact-based determinations to whether those determinations are supported by substantial evidence, courts are applying the substantial evidence test with ever-increasing rigor. Agencies need only look to the Newhall Ranch decision to see courts are asking the question of “why” factual conclusions were reached as part of judicial review.

Further, CEQA litigants are pressing for an increasingly broad approach to which documents are included in an agency’s administrative record (i.e., the evidence relied upon in court) under Public Resources Code section 21167.6. Often, CEQA litigants press to obtain documents through Public Records Act requests or discovery demands that are arguably outside the statutorily defined CEQA record and even seek evidence beyond what was before the agency at the time its decision was made.

Given these litigation trends, agencies should take note of the following:

  • Saying “why” in detail: Agencies are being asked to provide ever-increasing levels of detail as to how its conclusions were reached. By laying out all the evidence in administrative records, even if it seems excessive, agencies can better address why a decision was reached.
  • Laying out the reasons: Courts are looking behind expert opinion and seeking to probe the underlying facts and technical details behind those expert opinions. This makes it vital for agencies to thoroughly explain their decision-making process.
  • Managing the evidence: Petitioners often seek materials from public agencies under distinct laws (CEQA, the Public Records Act, civil discovery statutes, etc.). The standards for which documents are producible, and what an agency’s obligations actually are, vary under each law. Thus, it is important for an agency to be clear regarding which law it is responding to before making a production.
  • Knowing what is privileged: Certain items (trade secrets, privileged items, the detailed location of cultural artifacts, etc.) do not have to be included in the administrative record. Agencies should carefully review any documents they are proposing to produce to ensure that all privileges and other applicable production exemptions are preserved.


For more on the latest CEQA developments, check out Best Best & Krieger LLP’s recent webinar.

This article was originally published May 18, 2018 in PublicCEO. Republished with permission.

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