Jump to Navigation

California Revisits CEQA, the State’s Controversial Environmental Review Statute

January 28, 2013

Introduction

California lawmakers are poised again this year to try to reform the state’s far-reaching environmental review statute known as “CEQA” – the California Environmental Quality Act. What may make this time different is the control of one party – the California Democratic Party – over both the Governorship and the state legislature.

Like the National Environmental Policy Act (“NEPA”), CEQA requires an assessment of potentially significant environmental impacts of projects subject to government approvals. But where NEPA is procedural only, CEQA has a “substantive” component – it requires the conditioning of approval decisions upon commitments by project proponents to fully mitigate potentially adverse impacts, even where mitigation is not required by other environmental laws and regulations. In addition, CEQA is implicated in a much broader range of governmental decisions, from the promulgation of state-wide regulatory programs, to the adoption of regional land use plans, as well as the approval of individual projects at a local level.

CEQA can be a powerful tool to stop or improve poorly-conceived development proposals, but it is more notorious for its widespread use by special interest groups as a weapon to delay or block projects that may be necessary or desirable from a larger community perspective. As a result, there have been numerous attempts over the years to selectively revise the law, either by limiting the scope of its application or by making its specific requirements less onerous to meet on a case-by-case basis. Momentum is now building to attempt even more comprehensive reforms of CEQA, and any developer contemplating new projects in California will want to consider engagement with the legislative process.

A Lightning Rod for Controversy

While there is general recognition that at least some changes to the 43-year-old statute are necessary, there is little consensus as to what those changes should be. This lack of consensus was exemplified most recently by a failed effort last August to adopt CEQA exemptions for projects that comply with existing land use planning documents for which an environmental review has already been completed.[1] That effort, led by State Senator Michael Rubio (D-Bakersfield), also sought to limit CEQA’s requirements for environmental impact and mitigation analyses to standards set in other existing federal and state environmental laws.[2] While various business interests supported the effort, it was vigorously opposed by a number of environmental and labor groups. Governor Jerry Brown also hedged on the proposed reforms, calling changing CEQA “the Lord’s work,” while also acknowledging that he had not read any of the proposals offered to amend the statute.[3]

Controversy over CEQA reform also was apparent at a January 12, 2013, symposium on CEQA, hosted by the California Planning and Conservation League at the University of California-Davis School of Law.[4] Discussion among participants at the symposium revealed stark disagreements over CEQA’s future.[5] Despite an overall concurrence that CEQA could be improved, there was a widespread divergence of opinion over what specific improvements are needed and how they might be achieved.[6]

Proposals for Reform

Interest in CEQA reform is nothing new. In a 2005 background report prepared for the so-called CEQA Improvement Advisory Group (convened by the California Resources Agency), the Public Policy Institute of California (“PPIC”) identified CEQA as a major culprit in housing affordability problems throughout the state of California, noting that 15 of the 25 most unaffordable metropolitan housing markets in the nation are located within the state.[7] According to PPIC, there already was an emerging consensus in 2005 that CEQA should be relaxed to the extent necessary to allow and incentivize infill development projects throughout the state.[8] PPIC suggested a range of ideas on how this goal might be realized, including: shifting the planning burden for mitigation from the project level to the plan level; considering trade-offs among projects rather than merely analyzing a single project’s impacts; streamlining requirements for review and litigation; standardizing threshold and mitigation requirements; strengthening tiering and cumulative impacts analysis; expanding exemptions for infill and mixed-use developments or all housing development; and developing and pursuing long-range comprehensive community plans that identify growth and non-growth areas.[9]

In 2006, the San Francisco Planning and Urban Research Association (“SPUR”) released a similar report identifying ways in which CEQA could be “fixed.”[10] SPUR offered the following principles as guidance for a reform effort:

  1. Cities should continue to rely on developers to pay a pro rata portion of the cost of developing plans, policies, zoning and zoning approvals, and whatever environmental assessment is needed involving their sites. This may require a new form of assessment or exaction.
  2. Whatever system is used in place of CEQA must ensure that the state’s unique environment is fully protected. Sound policy respecting the environment should be included in newly defined and updated general plans.
  3. CEQA reform should reflect sound planning tenets, particularly those mandating a region-wide perspective on all urban and environmental matters, so that the result will be intensified population centers and protected greenfield areas viewed at a regional scale.
  4. All development-related processes--planning, zoning, and environmental assessment, should be coordinated so that they use common environmental thresholds, standards, and criteria, interact smoothly, and do not require separate bureaucracies to administer.
  5. Guidance about which projects are desirable and which ones are not should be offered to applicants before a project is underway, not after enormous investment in planning and redesign after environmental assessment.
  6. Environmental review procedures should consider the location of a project, and not treat all projects, no matter the setting, in a one-size-fits-all mode. A development that would be environmentally beneficial inside a city next to transit might be environmentally harmful on the suburban periphery or in exurban, rural, or open settings.
  7. Absent CEQA, the planning process should include mechanisms to grapple with the impact of land-use decisions on low-income communities in urbanized areas.[11]

SPUR also emphasized that CEQA should include additional exemptions for transit–oriented developments and infill projects and that compliance with adopted and up-to-date plans, plan elements, or planning policies should substitute for, and serve the same function as, an EIR (provided that the planning document addresses the necessary issues and undergoes regular review and updating).[12]

Efforts to Exempt “Desirable” Projects

There have been a number of attempts over the years to implement CEQA exemptions along the lines suggested by SPUR. In 2002, the state legislature passed SB 1925, which created a statutory exemption for residential infill development, provided that the developer can satisfy a number of specific preconditions;[13] however, not a single project has yet been able to meet those preconditions and qualify for the exemption.[14] Similarly, SB 375, passed in 2008, also provided for streamlined CEQA review of certain transit-oriented projects.[15] Again, however, no projects have been approved to take advantage of the law.[16]

In 2011, the legislature passed SB 226 in an effort to streamline the CEQA process for qualifying urban infill projects.[17] However, developers will not be able to take advantage of the process until the state Office of Planning & Research establishes performance standards under the statute, and those are not due out before the end of 2013.[18] How well the streamlined SB 226 process works in practice will depend substantially on what those standards entail.

Further Reform in 2013

Despite the failure of various attempts to facilitate development of affordable housing and transportation in California, CEQA reform remains a hot topic in Sacramento.[19] Senator Rubio, the new chairman of the California Senate’s Environmental Quality Committee, and Senate President Pro Tem Darrell Steinberg (D-Sacramento) have been meeting since October with environmentalists, developers, tribal groups, and others to find a path forward.[20] Two main proposals currently under discussion essentially recycle proposals from last summer: (1) disallowing CEQA challenges if a project is consistent with an improved city or county general plan, if that plan has an approved environmental impact report, with the additional requirement that the project is also consistent with SB 375; and (2) disallowing a CEQA challenge where a developer has complied with umbrella state or federal laws that specifically cover the impact.[21] The legislature also may consider a transparency measure requiring those filing lawsuits challenging compliance with CEQA to disclose who is paying the cost of the litigation.[22]

The likelihood of these reforms being passed by the legislature (and the overall effect they would have, if passed) is uncertain. While there may be support for a transparency measure that requires a CEQA plaintiff to disclose funding, the other two proposals faced staunch resistance when raised before. The first proposal could shift disputes over approval of specific projects to debates over whether city or county plans provide adequate environmental protections. That could make it necessary for cities and counties to update their plans and corresponding environmental impacts reports on a more frequent basis. The second proposal might help reduce duplicative review of certain types of environmental impacts; however, many CEQA review provisions in these areas are already linked closely to compliance with existing laws that target those impacts, like the Clean Air Act, Clean Water Act, and Endangered Species Act. Moreover, such a proposal presumably would have no effect on CEQA analyses of impacts in other areas, such as aesthetics; cultural resources; geology, soils, and seismicity; noise, population, and housing; public services; recreation; transportation; and utilities and service systems.

Conclusion

For the time being, all eyes will be on Senator Rubio to see what kind of leadership he shows going forward on CEQA reform. Rubio is a Democrat, but comes from a conservative, rural district in California’s Central Valley – his is the Senate’s 16th District, which includes all of Kings County and parts of Fresno, Tulare, and Kern counties.[23] Republicans in last year’s election made up 46 percent of registered voters there.[24]

Senator Rubio is meeting now with interested groups to assess potential changes to the law. He also has been conferring with Senate leadership, looking for “areas that we agree are important components of CEQA that we should preserve,” but also discussing “areas that have been abused that we can work on.”[25] Rubio has indicated that he plans to go back to interested groups with a general framework before introducing a bill within the next month.[26] Groups throughout the state are anxious to see what that framework will look like and whether, given the long history of controversy that has preceded it, this important next step has any realistic prospect of success.

For more information on California’s CEQA statute, please contact Kevin Haroff in Marten Law’s San Francisco office.

[1] I. David, Will 2012 be the Year of CEQA Reform in California? Planetizen (Aug. 23, 2012).

[2] CEQA Reform Moves Forward – Action Needed! CalChamber (Aug. 22, 2012).

[3] D. Siders, Jerry Brown: CEQA reform is ‘Lord’s work’; noncommittal on bill, The Sacramento Bee (Dec. 3, 2012).

[4] R. Cruickshank, CEQA Reform and Transit Planning, California High Speed Rail Blog (Jan. 13, 2013).

[5] Id.

[6] @PCLeague, last viewed on Jan., 26, 2013.

[7] E. Barbour & M. Teitz, CEQA Reform: Issues and Options, Public Policy Institute of California (Apr. 6, 2005).

[8] Id.

[9] Id.

[10] P. Sedway, Form and Reform: Fixing the California Environmental Quality Act, San Francisco Planning + Urban Research Association (Nov. 16, 2005).

[11] Id.

[12] Id.

[13] Bill Number SB 1925, filed with Secretary of State on Sept. 28, 2002.

[14] Is CEQA “Fixed”- Do Infill CEQA Reforms Help or Handicap Your Project? Holland & Knight.

[15] Bill Number SB 375, Filed with Secretary of State on Sept. 30, 2008.

[16] Supra note 14.

[17] Bill Number SB 226, Amended in Assembly on Sept. 9, 2011.

[18] Id.

[19] M. Gardner, Key environmental law targeted for overhaul, UT San Diego (Dec. 23, 2012).

[20] D. Kahn, Democrats plan overhaul of landmark environmental law, E&E Publishing, LLC (Dec. 11, 2012).

[21] Supra note 19.

[22] Id.

[23] A. Mulkern, ‘Rising star’ leads push to overhaul landmark Calif. environmental law, Greenwire (Jan. 23, 2013).

[24] Id.

[25] Id.

[26] Id.

This article is not a substitute for legal advice. Please consult with your legal counsel for specific advice and/or information. Read our complete legal disclaimer.