LAND USE AND CEQA LITIGATION UPDATE

Transcription

1 League of California Cities 2010 Fall Conference City Attorneys Department September 16, 2010 LAND USE AND CEQA LITIGATION UPDATE (May 1, 2010 through August 10, 2010) M. Katherine Jenson City Attorney, City of La Quinta Rutan & Tucker, LLP 611 Anton Boulevard, 14th Floor Costa Mesa, CA Phone: (714)

2 [ORGANIZATION CORRESPONDS TO CHAPTERS X and XI OF MUNICIPAL LAW HANDBOOK] CHAPTER X LAND USE Part 3. Zoning Special Issues (C) Adult Entertainment Musa Madain v. City of Stanton, 185 Cal.App.4 th 1277 (June 2010) HOLDING: Because there was an issue of fact as to whether the City manipulated the application dates in order to give a church s application priority over the plaintiff s cabaret application and that issue had not been addressed in the city council s findings, the City was ordered to reconsider whether the plaintiff s application was entitled to priority over the application of a church, based upon the circumstances surrounding the submission of the applications. DISCUSSION: The plaintiff applied for a permit to operate an adult-oriented cabaret. The City denied the application because a church had already submitted an application to operate next door. (Stanton Municipal Code section forbids adult businesses from operating within 300 feet of a church.) If the plaintiff had submitted his application before the church, he would have received priority. On appeal, the plaintiff argued that the City had manipulated the timing of the applications in order to ensure he did not get this priority. The plaintiff claimed that on December 2, 2008, he tried to file two things: (a) his application for tenant improvements and (b) his adult business application. He also claimed a City employee said she would only accept his tenant improvement application. The next day, a City employee contacted the church, which quickly filed its application on December 8th. The City waited another ten days to notify the plaintiff that he also needed to submit an adult business application. Due to the delay, the plaintiff filed after the church and therefore lost priority. Because of this sequence of events, it was possible that the City manipulated the timing to ensure the church would get priority. Following a hearing, the city council affirmed the denial of the plaintiff s permit, but did not address or make findings regarding the factual disputes surrounding the events. The plaintiff filed a writ of mandate in order to challenge the city council s decision, but this was denied by the trial court. The plaintiff appealed. The appellate court found that the alleged manipulation constituted an issue of fact. The city council abused its discretion by failing to even address these factual disputes.

3 (K) Signs World Wide Rush, LLC v. City of Los Angeles, 606 F.3d 676 (May 2010) HOLDING: The Ninth Circuit upheld the City s bans on various types of billboards, despite exceptions to those bans that permitted some of the otherwise prohibited billboards. DISCUSSION: The regulations in question prohibit (1) all freeway facing signs and (2) supergraphic (large format signs affixed to buildings) and off-site signs, except under certain limited circumstances. The asserted purpose for these regulations is to promote public safety and welfare by provid[ing] reasonable protection to the visual environment and by ensuring that billboards do not interfere with traffic safety or otherwise endanger public safety. World Wide Rush ( WWR ) sued the City to enjoin enforcement of the City s billboard regulations. WWR argued that the freeway facing sign ban ( FFSB ) was an unconstitutionally underinclusive restriction on commercial speech because the City had permitted some freeway facing billboards despite the ban. WWR also challenged the Supergraphic and Off-Site Sign Bans as facially unconstitutional prior restraints on speech, arguing that the exceptions to these bans vested the City Council with unbridled discretion to select among preferred speakers because those exceptions lacked objective criteria for their application. The FFSB prohibits billboards located within 2,000 feet of and viewed primarily from a freeway or an on-ramp/off-ramp. WWR challenged exceptions that permit billboards (1) near Staples Center and (2) in a special use district created in connection with the City s renovation of Santa Monica Boulevard. The City contended that the nature of the Staples Center use, coupled with its location in the center of a highly urbanized area, required billboards that could effectively communicate event-related information. The City justified the exception carved out for Santa Monica Boulevard as being necessary to avoid the requirements of takings law due to existing signage. Certain existing signs were permitted to be relocated to a new special use district. The supergraphic and off-site bans prohibited large format and off-site signs, but exempted signs that are specifically permitted pursuant to a legally adopted specific plan, supplemental use district or an approved development agreement. The district court sided with WWR, concluding that the regulations violate the First Amendment. The Ninth Circuit disagreed and upheld both bans. The Ninth Circuit found the City s exceptions to the FFSB did not undermine the City s interests in aesthetics and safety. To the contrary, the exceptions were made for the express purpose of advancing those very interests. Staples Center was a state-of-the-art sports and entertainment complex that was developed to eliminate blight and dangerous conditions downtown. Allowing billboards at the facility was an important element of the project to remove blight and dangerous conditions from downtown Los Angeles. Similarly, the regulations relating to the Santa Monica Boulevard area were an outgrowth of the City s efforts to improve traffic flow, and thereby safety, on Santa Monica Boulevard. Not only did the allowance of signs in the new special district advance the goal of improved traffic safety and traffic flow on Santa Monica Boulevard, because only 4 of 16 signs

4 could be relocated, it also resulted in a net reduction of billboards in the City. The Ninth Circuit noted the importance of evaluating the challenged restriction on commercial speech in the context of the entire regulatory scheme, rather than in isolation. In reaching its conclusion, the court stated: The Freeway Facing Sign Ban is not a means by which the evil sought to be prohibited is simply channeled elsewhere, at odds with the asserted governmental interests. Rather, the City submitted a convincing rationale which is entirely consistent with its asserted governmental interest for exempting some freeway facing signs from its Ban. The Ninth Circuit further found the Supergraphic and Off-Site Sign Bans were not unconstitutional prior restraints on commercial speech. Under the prior restraint doctrine, a law cannot condition the free exercise of First Amendment rights on the unbridled discretion of government officials. Thus, where a legislative body enacts a permitting scheme for expressive conduct but reserves some decision-making authority for itself under that scheme, that reserved authority is vulnerable to challenge on grounds of unbridled discretion. The exceptions to the Supergraphic and Off-Site Sign Bans, however, are rooted in the City Council s legislative discretion, not its discretion to make executive decisions as part of the regulatory scheme. This distinction was critical to the decision. The prior restraint doctrine does not apply to the legislative function at issue here. The City Council s authority to enact special plans, create special use districts, or enter into development agreements derives from its traditional legislative power to regulate land use; it does not depend upon or derive from the bans. As the Ninth Circuit stated: The City Council would have the power to employ any of those land use tools even if none was ever mentioned in the bans; the bans do no more than affirm the existence of these legislative powers. The First Amendment is not implicated by the City Council s exercise of legislative judgment in these circumstances. Part 4. Subdivisions Citizens for Responsible Equitable Environmental Development v. City of San Diego, 184 Cal.App.4 th 1032 (May 2010) HOLDING: The City is not required to provide the requisite forms of notice of its intent to vacate a public right-of-way and abandon various public easements pursuant to the Public Streets, Highways and Service Easements Vacation Law ( PSHSEVL ) (Streets & Highway Code 8300 et seq.), where the City instead provided notice of its intent to vacate the right-ofway and easements pursuant to the Subdivision Map Act (Gov. Code et seq) and properly effectuated the vacations pursuant to that Act. DISCUSSION: The petitioner sued the City, alleging that it failed to properly notice a public hearing at which the City adopted resolutions approving general plan amendments and the tentative map for the redevelopment and expansion of a local shopping mall. The City s notice specified that it would hold a public hearing concerning the approval, modification or denial of an application for an amendment to the Progress Guide and General Plan, [and] the University Community Plan [and] Vesting Tentative Map with summary vacation of utility, pedestrian, and non-motor vehicle easements and public right-of-way... After conducting a public hearing, the City approved the resolutions approving the general plan amendments and the tentative map. The tentative map resolution provided that specifically listed

5 right-of-way and easements on the property must be vacated in accordance with the City s municipal code and pursuant to the Subdivision Map Act (particularly Government Code section 66434(g)), prior to the recordation of the Final Map. The trial court denied the petition; the petitioner appealed the judgment in favor of respondents. On appeal, the petitioner argued that the City s notice was deficient under both PSHSEVL, which requires notice of proposed vacations to be posted along the easements and rights-of-way, and the City s municipal code, which, the petitioner argued, mandates compliance with the notice provisions of the PSHSEVL. Essentially, the petitioner claimed that the City could only vacate easements and rights-of-way under the PSHSEVL, not the Subdivision Map Act. The City argued that it had complied with all applicable notice requirements because the Subdivision Map Act provided an alternative method for vacating public easements and rights-of-way. The court agreed with the City, finding that the City need only effectuate the vacations at issue pursuant to the Subdivision Map Act and the municipal code provisions implementing the Act. The court explained that both the Act and PSHSEVL provide a method for vacating easements. However, the PSHSEVL, at Streets and Highways Code section 8311(a), provides that the procedures set forth therein are alternative procedures and that the authority granted in [PSHSEVL] is an alternative to any other authority provided by law to public entities. The Subdivision Map Act is one such alternative - it provides a separate, lawful manner by which public entities may vacate public rights-of-way and easements. Torrey Hills Community Coalition v. City of San Diego, 186 Cal.App.4 th 429 (July 2010) (Case also relates to Chapter XI, Part 2. CEQA Legal Challenges (D) Procedural Requirements - (4) Briefing and Hearing) HOLDINGS: (1) The plaintiff was not excused from the 90-day service of summons requirement under the Subdivision Map Act even though the court clerk had a policy of not issuing summons for writ petitions would not issue a summons because those circumstances did not meet the standard for impossibility under California Code of Civil Procedure section (d); and (2) California Public Resources Code section , subdivision (a) requires a written request for a hearing. DISCUSSION: The City approved a condominium and retail project. A community association filed a petition for writ of mandate challenging the City s approval of the project and alleging various CEQA violations. Because the project approvals were issued under the Subdivision Map Act, the City moved to dismiss the petition because the association had failed to serve a summons within 90 days of the City s approval, as required by a provision of the Subdivision Map Act (Gov. Code, ). The petitioner also did not file a written request for a hearing on the writ petition within 90 days of filing the petition. Instead, the petitioner telephoned the trial court clerk to request a hearing date. The clerk never gave the petitioner a hearing date. The City subsequently amended its motion to include as an alternative ground for dismissal the petitioner s failure to file a written request for a hearing within 90 days of filing the petition,

6 pursuant to California Public Resources Code section , subdivision (a). The trial court granted the amended motion to dismiss on both grounds. On appeal, the petitioner argued that the 90-day period was tolled for impossibility under California Code of Civil Procedure section , subdivision (d). The petitioner argued that it would have been impossible to obtain a summons by the 90-day deadline because the San Diego Superior Court refused to issue a summons for writ petitions containing a CEQA cause of action, even after the publication of Friends of Riverside s Hills v. City of Riverside, 168 Cal. App. 4th 743 (2008) ( Friends ). Friends held that CEQA challenges raised in writ petitions, pertaining to an agency s decision under the SMA, are subject to the 90-day service of summons requirement. (Id. at 749.) The court concluded that impossibility was not demonstrated because the petitioner did not attempt to obtain a summons. Impossibility requires a plaintiff to establish diligence to serve the summons and impossibility to do so because of circumstances outside the plaintiff s control. The petitioner argued that as a case of first impression, Friends should be applied only to writ petitions filed after Friends date of publication. The court disagreed, holding that Friends did not materially change the law, and applying Friends retroactively to the petitioner was not fundamentally unfair. The court noted that the petitioner s failure to obtain a summons was dispositive. However, the court addressed the petitioner s second contention that the lower court erred by dismissing on the additional ground that the petitioner did not file a hearing request in writing, pursuant to California Public Resources Code section The court concluded that although section , subdivision (a) does not explicitly refer to a writing, section as a whole obviously requires a written request. Part 5. Housing Embassy, LLC, et al v. City of Santa Monica., et al., 185 Cal.App.4 th 771 (June 2010) HOLDING: The Ellis Act prohibits public entities from enforcing contractual waivers of a landlord s rights under the Ellis Act in all circumstances except those specified in the statute. DISCUSSION: The Embassy Hotel Apartments ( Embassy ) historically had been operated as a hotel apartment, with its owners renting both hotel units and apartment units. Approximately a decade ago, the City and the owners of Embassy the appellants in this matter entered into a settlement agreement to resolve a dispute relating to the appellants alleged failure to pay required transiency occupancy taxes for the hotel component of Embassy. One provision of that settlement agreement provided that, except for in specified circumstances, the owner waived the right to withdraw the tenant units from the rental housing market pursuant to the Ellis Act. Sometime later, the appellants notified the City that they intended to remove their apartment units from the rental market. The City cited the waiver of the Ellis Act in the settlement agreement as support for its decision to not allow the removal of those units. As a result, the appellants filed this action, arguing that the waiver was unenforceable. The Court of Appeal agreed with the appellants, finding that the Ellis Act provides that a contractual waiver of a

7 landlord s rights under the Ellis Act is unenforceable in all but those circumstances enumerated in the Act. As the court explained, the central prohibition of the Ellis Act in Government Code section 7060 provides that a public entity cannot, by statute, ordinance, or regulation, or by administrative action implementing any statute, ordinance or regulation, compel the owner of residential property to offer the property for rent. Government Code section provides that a public entity may nonetheless enter into and enforce certain specified contracts compelling the residential landlord to continue renting the property. The specific allowed instances in section include contracts where consideration is given for a direct financial contribution, or any contracts entered into prior to July 1, Thus, by providing that Ellis Act waivers may be enforced in some contracts, section tells us that they may not be enforced in other contracts. Relying on principles of statutory construction and the legislative history of section , the court explained that public entities cannot avoid the Act s prohibitions by acting through contract, rather than through regulation. Accordingly, because none of the enumerated conditions were met in this case, the waiver was deemed invalid. Part 8. Exactions: Fees and Dedications Homebuilders Association of Tulare/Kings County, Inc. v. City of Lemoore, 185 Cal.App.4 th 554 (June 2010), modified at 186 Cal.App.4 th 497a (July 2010). HOLDING: The majority of the City s development impact fees were upheld against challenges under the Mitigation Fee Act, Government Code section et seq. and the Quimby Act, Government Code section The fire protection fee was struck down as not being reasonably related to the impacts created by the development project where the fee was used to reimburse the City s general fund for prior fire facility expenditures that already exist. DISCUSSION: The City hired a consultant to conduct a development fee impact study and prepare a report to support the fee. Based upon the report, the City held a public hearing and adopted 13 impact fees for new housing developments. The local homebuilders association challenged seven of the fees. The trial court upheld six of the fees, but struck down the park land improvement impact fee as applied to subdivisions that were subject to the Quimby Act. On appeal, the court clarified that in defending an impact fee against a challenge under the Mitigation Fee Act, the City has the initial burden of producing evidence of the reasonableness of the relationship between the fee charged and the burden imposed by the development. The challenger bears the burden of proving that the record before the City did not support the City s underlying determination. In this regard, the court distinguished Beaumont Investors v. Beaumont-Cherry Valley Water Dist. (1985) 165 Cal.App.3d 227, which decision had conflated the two concepts of the burden of evidence production and the burden of proof. The appellate court upheld all of the fees except a fire impact fee; and as to that fee, the court found that it did not reasonably relate to the burden created by the development.

8 The court rejected the claim that the community/recreation facility fee was invalid for inadequately describing the public facilities to be financed with the fee. The court held that the resolution could identify a broad class of projects to be funded with the fee. It also found that the City acted reasonably in basing the fee on the existing ration of community and recreation facility assets value to population. It further rejected the argument that Quimby Act preempted the fee, noting that while Quimby is intended to pay for community facilities that service the subdivision which generated the fee, the City s fee was for city-wide improvements designed to service the City as a whole. The challenge to the police impact fee was also rejected. The court upheld the standard-based method (maintaining existing ratios) used to calculate the fee, and also allowed the inclusion of police vehicles and equipment. Likewise, the court rejected the challenge to the municipal facilities fee that was collected to ensure the existing level of municipal facilities, vehicles and equipment. Because the fee was assessed at different levels for different types of development, the court held it met the nexus requirement. The fire protection impact fee for the older, established portion of the City was struck down. The fee study concluded that, in that portion of the City, no additional facilities or equipment was needed to serve future development. The fee collected for development in that area would be used to reimburse the City for expenditures it had recently made from its general fund for fire facilities in this area. The court held this was not a proper fee; the City could not recover the new development s proportionate share of the cost of the fire protection assets already serving the area. Part 12. California Coastal Act R. Brian Hines v. California Coastal Commission, 186 Cal.App.4 th 830 (July 2010) (Case also relates to Chapter XI, Part 2. CEQA, , Scope of CEQA, (C)(2) Categorical Exemptions, and to , Legal Challenges) HOLDING: In the California Coastal Act portion of the opinion, the court upheld (1) coastal and use permits that allowed the construction of a residence within 50 feet of a riparian habitat rather than the 100-foot setback policy contained in the local coastal plan; and (2) the Coastal Commission s determination that the appeal of the coastal permit and use permit raised no substantial issues that would require the Commission to hear the appeal. As to the CEQA claims, the court held (1) that where there is a public hearing on a project for which a CEQA exemption is claimed, the petitioner must exhaust his or her administrative remedies by objecting the exemption; and (2) the categorical exemption contained in CEQA Guideline applied to the applicant s proposed single family residence. DISCUSSION: The County issued a coastal permit and a use permit for the construction of a 1,208 square foot single family home and a 400 square foot garage on a 26,825 square foot lot along the Sonoma coast. The use permit allowed a reduction in the riparian corridor setback from 100 feet to 50 feet. The 100 foot setback standard was contained in one of the policies in the County s local coastal program. However, an attachment to the administrative manual containing the policy permitted the reduction of the buffer if the applicant can demonstrate that

9 100 feet is unnecessary to protect the resources of the habitat area. A biologist s report indicated that only a 50-foot setback was necessary to protect the habitat area. The County s board of zoning adjustment approved the permits, and a neighboring property owner appealed to the County Board of Supervisors. That Board upheld the approvals. The Board interpreted the policy as permitting a reduction if the applicant demonstrated that the full setback was not necessary. The Board found that the applicant had demonstrated that a 50-foot setback was adequate to protect the riparian habitat. It further found that due to the conditions that existed on the site, to subject the applicant to the 100 foot setback would amount to a taking. The challengers then filed an appeal of the County s approval of the permits with the California Coastal Commission. Pursuant to Public Resources Code section 30625(b), the Commission determined that the appeal raised no substantial issue, and therefore declined to hear the appeal. The court upheld the Commission s decision to not review the permits. It concluded that there was no significant question as to the project s conformity with the local coastal program. The court further held that the takings finding was not necessary because there had been compliance with the local coastal program, and therefore even if the finding was not supported, it would not mean that the decision should be set aside. The court upheld the Board s approval of a reduced buffer. Based upon the evidence in the record, the court rejected the petitioners argument that the approval violated Public Resources Code section 30240, which provides heightened protection of sensitive habitat areas. The Board did not abuse its discretion in its interpretation or application of the 100-foot setback policy. With regard to the challenger s CEQA claims, the court held that the Coastal Commission s decision not to exercise jurisdiction over the permits did not constitute an approval of a project, and was therefore not subject to appeal. As to the CEQA claims against the County, the court held that the petitioners had failed to exhaust their remedies regarding the application of the categorical exemption contained in CEQA Guideline for a single family residence. The court held that, because a public hearing had been required under the County code and had in fact been held, the petitioners were subject to the requirement that they exhaust their administrative remedies. Note this is in direct conflict with the decision in Fred Tomlinson, et al v. County of Alameda, 185 Cal.App.4 th 1029 (June 2010) (rehearing granted based upon Hines), discussed below. The court went on to find that the CEQA exemption was properly relied upon in any event. The court notes the split of opinion as to the standard of review in determining the applicability of the exceptions to categorical exemptions contained in CEQA Guideline Some courts and commentators have applied the fair argument test, while others have applied the substantial evidence test. The court held that, even under the fair argument test, the challengers had not met their burden. They argued that because there were 14 vacant lots along the riparian area, the cumulative impacts of the project should be considered significant. However, the court noted that the argument that the owners of the other 14 properties would be allowed to build 50 feet from the riparian habitat was speculation. Because there was no evidence in the record that such impacts would occur, the court rejected the petitioner s argument that the exceptions to the categorical exemption precluded the applicant from replying upon the exemption for single family homes in CEQA Guideline

10 Part 13. Tidelands, Beaches and Streams Regulatory Authority (C) Army Corps of Engineers Butte Environmental Council v. United States Army Corps of Engineers, 607 F.3d 570 (June 2010) HOLDING: The decisions of the U.S. Army Corps of Engineers ( Corps ) to grant a permit approving construction of a business park on federally protected wetlands was neither arbitrary nor capricious where the Corps rationally concluded that the proposed site was the least environmentally damaging alternative. The court also held that the U.S. Fish and Wildlife Service s ( FWS ) opinion that the proposed project would not adversely modify the habitat of certain endangered species was not arbitrary or capricious because FWS applied the proper definition of adverse modification and reasonably concluded that the proposed project would cause no such modification. DISCUSSION: The two federal statutes at issue in this appeal are the Clean Water Act ( CWA ), 33 U.S.C. 1251, and the Endangered Species Act ( ESA ), 16 U.S.C Under the CWA, any discharge of dredged or fill materials into navigable waters defined as the waters of the United States is forbidden unless authorized by a permit issued by the Corps. The Corps may issue a permit only if there are no a practicable alternatives to the proposed discharge that would have a less adverse impact on the aquatic ecosystem. 40 C.F.R (a). Under Section 7 of the ESA, federal agencies must take certain steps in consultation with the Secretary of Interior or Commerce to ensure their actions do not jeopardize endangered wildlife and flora. The ESA further requires the Secretary of Interior or Commerce to provide at the conclusion of said consultation a written statement setting forth the Secretary s opinion, and a summary of the information on which the opinion is based, detailing how the agency s actions will affect the species critical habitat. The City of Redding ( City ) decided to construct a business park on 678 acres of wetlands along Stillwater Creek. The proposed site was home to several endangered species (vernal pool fairy shrimp, vernal pool tadpole shrimp, and Orcutt grass). In an attempt to satisfy the conditions of both the CWA and the ESA, and to eventually obtain permission to develop the land, the City drafted an environmental impact statement ( EIS ). The EIS addressed the effects of the proposed development on the actual wetlands, as well as the endangered species that lived on the wetlands. Based on a comparison of over a dozen other sites, the EIS concluded that the Stillwater site was the least environmentally damaging practicable alternative. The City submitted the draft EIS for review to the Corps and the EPA. Initially, both agencies stated a number of concerns with the EIS. The City subsequently worked closely with both the Corps and the EPA to resolve the issues. In February 2006, the City submitted its final EIS to the EPA and Corps.

11 In March 2006, the City formally applied for a section 404 permit for permission from the Corps to build the business park. Based on its review, the Corps determined that the proposed site would have acres of direct impact, and acres of indirect impact on the waters of the United States. Notwithstanding this impact, the Corps concluded that the proposed site was the least environmentally damaging practicable alternative, thus satisfying the requirements of the CWA. Accordingly, the Corps granted the City s application to build. Pursuant to Section 7 of the ESA, the City also needed the approval of the FWS. Based on its review, the FWS determined that the proposed development would affect critical habitat shared by the various endangered species, including tadpole and fairy shrimp, and would also destroy Orcutt grass habitat. In spite of this, the FWS concluded that the Stillwater Business park project is not likely to jeopardize the continued existence of the vernal pool fairy and tadpole shrimp or the Orcutt grass. Further, the FWS concluded that the proposed project would not result in the adverse modification or destruction of those species critical habitat. In June 2008, the plaintiff filed suit against the Corps, the FWS, and the City in federal court. The district court granted summary judgment in favor of the agencies and the City, and the plaintiff timely appealed. On appeal, the plaintiff argued that the Corps decision to grant the permit was arbitrary and capricious because the Corps failed to properly apply the controlling statutory laws to the facts. The court did not find this argument persuasive. The court concluded that the Corps stated rationale for granting the permit was rationally connected to the facts and conclusion that the proposed site was the least environmentally damaging alternative. As such, the court ruled the Corps decision was neither arbitrary nor capricious. The plaintiff also challenged FWS s opinion that the proposed project would not result in the adverse modification or destruction of the fairy and tadpole shrimp and Orcutt grass habitats. Butte argued that the FWS applied an improper definition of adverse modification under Section 7 of the ESA. The court, however, found that the FWS had in fact applied the correct definition of adverse modification, which the Ninth Circuit had defined in Gifford Pinchot Task Force v. U.S. Fish and Wildlife Service, 378 F.3d 1059 (9 th Cir. 2004). That correct definition takes into account not only the habitat needed for survival of the species, but also the habitat needed for recovery of the species. As such, the court concluded that the FWS s opinion was neither arbitrary nor capricious. The court affirmed the judgment of the district court. Part 14. Challenges to Land Use Decisions Regulatory and Physical Takings Stop the Beach Renourishment, Inc. v. Florida Department of Environmental Protection, 130 S. Ct (June 2010) HOLDING: The U.S. Supreme Court held that Florida did not violate the Takings Clause of the Fifth Amendment when it allowed the placement of 75 feet of new, public beach between formerly beachfront property owners and the water, without the payment of just compensation.

12 DISCUSSION: The issue in this case was whether Florida violated the Takings Clause by depositing new sand seaward of the high-tide line. Florida Department of Environmental Protection restored 6.9 miles of hurricane damaged beachfront, adding about 75 feet of dry sand seaward of the mean high-water line. Beachfront property owners objected through an administrative challenge, which was unsuccessful. Property owners then challenged the action in Florida state court, and the case made its way to the Florida Supreme Court. The Florida Supreme Court held the state law permitting beachfront restoration was not a taking under the Florida Constitution. Under Florida law, the mean high-water line is the ordinary boundary between private beachfront property and state-owned land. Private owners automatically take title to dry land added to their property by accretion. Formerly submerged land that becomes dry land by avulsion continues to belong to the state. An accretion occurs gradually and imperceptibly, while an avulsion is a sudden change. Florida law, before the Florida Supreme Court s decision, had no exception to avulsion, even if the state caused the avulsion. Thus, Florida law allowed the state to fill in its own seabed with dry land, and the resulting sudden exposure of sand was treated as an avulsion for ownership purposes. The U.S. Supreme Court held that Florida did not violate the Takings Clause. The court unanimously held that the Florida Supreme Court s decision did not constitute a judicial taking because the court s holding did not contravene established property law. Four Justices signed portions of the opinion, recognizing the validity of a judicial takings claim in general. Specifically, the four Justices concluded that judicial takings occur when courts declare a well established private property right no longer exists. However, the court unanimously agreed that Florida Supreme Court s decision did not constitute a judicial taking because the court s avulsion analysis followed established property law. (C) Ripeness Requirements and Other Limitations on Challenges (3) As-Applied Claims (d) Exhaustion of Administrative and Judicial Remedies Steve Howard, et al. v. County of San Diego, 184 Cal.App.4 th 1422 (May 2010) HOLDING: The plaintiffs failure to seek a County general plan amendment so that they could build a barn at particular location did not necessarily preclude them from pursuing an action against the County, relating to the County s refusal to issue a building permit for the barn. DISCUSSION: The plaintiffs applied to the County for a building permit to build a metal barn on their property. The County denied the permit because the location of the proposed barn would interfere with a future proposed road shown in the County s general plan. The plaintiffs met with County officials to resolve their dispute, but no agreement was reached. The plaintiffs filed an action against their broker, the sellers, the sellers broker, their title company, and the County, asserting various causes of action. The trial court held that the plaintiffs had failed to exhaust their administrative remedies against the County and dismissed the plaintiffs complaint against the County without prejudice. The plaintiffs attempted to further exhaust their remedies

13 by submitting to the County a Request for a Modification to a Road Standard and/or to Project Conditions. The County responded that the plaintiffs would have to seek a general plan amendment and that the plaintiffs would be responsible for costs related to processing and preparation of environmental documentation and studies. The plaintiffs thereafter brought a motion to amend their complaint to add the County back into the action. The trial court denied the motion, noting that the plaintiffs should have attempted a general plan amendment. The court of appeal held that the failure to pursue administrative remedies does not bar judicial relief where the administrative remedy is inadequate or unavailable, or where it would be futile to pursue the remedy. Here, accepting the plaintiffs allegations as true, the court could not hold as a matter of law that the plaintiffs failed to exhaust their administrative remedies. Rather, because the County informed the plaintiffs, on a number of occasions, that the proposed road would be built as planned and that their actions were futile, the allegations created a triable issue of fact as to whether or not the County s decision was final and whether any further attempts to exhaust their administrative remedies would be futile. Further, because a general plan amendment is a legislative, and not administrative, action, the plaintiffs were not required to seek an amendment to adequately exhaust their administrative remedies. As a result, the matter was remanded to the trial court to grant plaintiffs leave to amend their complaint. CHAPTER XI PROTECTING THE ENVIRONMENT Part 2. California Environmental Quality Act (CEQA) Basics (F) Timing for CEQA Compliance City of Santee v. County of San Diego, 186 Cal.App.4 th 55 (June 2010) HOLDING: The County was not required to complete environmental review prior to entering into a siting agreement with the State Department of Correction ( Department ), in which the County agreed to identify up to three potential sites for a reentry facility in exchange for preference in the award of state financing of county jail facilities. DISCUSSION: The County entered into an agreement with the Department in which it agreed to identify up to three potential sites in the county for the placement of a reentry facility. At such a facility, state prisoners receive assistance as they prepare to transition into society. An exhibit to the agreement identified two potential sites one owned by the County and one that was privately owned. Under the agreement, if the Department selects one of the sites identified by the County, the County would get preferential access to $100 million in assistance to finance construction of county jail facilities. The agreement also provides that the county will cooperate with and assist the Department in the planning, construction, and operating of a reentry facility at any location selected by the department. That cooperation included an agreement to convey any county owned land at the selected site. The Department was obligated to conduct CEQA review before constructing any reentry facility. At the time it entered into the siting agreement, the County was in the process of completing an EIR for a jail facility within the City of Santee. The City challenged the siting agreement under

14 CEQA. Its petition for writ of mandate, the City alleged that the agreement was a project requiring CEQA review because according to the City, the agreement committed the County to a site for the reentry agreement and also committed the County to the expansion of the jail facility within the City. Applying the analysis articulated in Save Tara v. City of West Hollywood (2008) 45 Cal.4 th 116, and more recently in Sustainable Transportation Advocates of Santa Barbara v. Santa Barbara County Assn. (2009) 179 Cal.App.4 th 113, the court rejected the City s attack on the siting agreement. The court noted that, by its own terms, the siting agreement did not select any location for the reentry facility, and did not even reference the expansion of the jail facility within the City. It also did not require the Department to select any of the locations identified. While the County was obligated to convey property to the Department if the Department did select a County-owned site identified pursuant to the agreement, the court noted that the obligation was conditional. The court noted that the fact that the County identified a site it did not own undercut the City s argument. The court also noted that before any such conveyance would take place, the Department would have to complete CEQA review. How the fact that the Department would complete CEQA review relates to the County s commitment to sell is not really explained by the opinion. The court also looked at evidence outside the four corners of the siting agreement and concluded that it did not demonstrate a precommitment to approve either the reentry facility or the jail expansion. The City pointed to evidence that as to the privately owned site, the Department had taken several steps to assess needed infrastructure, site costs, and had prepared a grading plan. The court noted: These preliminary steps in no sense represent any commitment to the [privately owned site]. Rather, on their face they represent no more than the Department of Correction s attempt to determine whether it should proceed with the site... (Opinion, p. 15.) It concluded that [u]nder Save Tara environmental review cannot be required where an agency is engaged only in such exploration and formulation of a potential project. (Ibid.) Scope of CEQA (C) Exemptions from CEQA (2) Categorical Exemptions Fred Tomlinson, et al. v. County of Alameda, 185 Cal.App.4 th 1029 (June 2010) (Note: no longer citable. Petition for Rehearing granted on July 19, 2010.) HOLDING: The in-fill development exemption from CEQA contained in CEQA Guideline did not apply to a proposed development in an unincorporated area because it is not within the city limits as required by the exemption, and the statutory exhaustion requirement of Public Resources Code section does not apply to an agency s determination that a project is exempt from CEQA. DISCUSSION: A developer proposed to merge two parcels into one 1.89 acre parcel, divide it into 12 lots, and develop each with a single family home. The property was in an unincorporated portion of the County.

15 The County determined the project was exempt from CEQA under CEQA Guideline 15332, which exempts certain in-fill projects. Under subsection (b) of the exemption, the proposed development must occur within city limits on a project site of no more than five acres substantially surrounded by urban uses... (Emph. added.) The challengers appeared at the planning commission and board of supervisors meetings and objected to the project, but never raised this issue that the exemption could not be used because it was not within any city limits. In addressing the exhaustion issue first, the court held that Public Resources Code section does not apply to a determination that a project is exempt from CEQA, even where that determination is the subject of public hearings. The court indicated that even though the challengers had seemingly conceded that they had a duty to exhaust their remedies by raising the issue below, the court was not bound by such concessions since the issue was one of law. Note, this is directly contrary to the holding in R. Brian Hines, et al v. California Coastal Commission, 186 Cal.App.4 th 830 (July 2010), discussed above. The court also held that the language in the guideline requiring that the subject development be within the city limits had to be interpreted literally, and that the county could not reply upon the infill exemption Environmental Impact Report (EIR) (D) Contents Center for Biological Diversity v. County of San Bernardino, 185 Cal.App.4 th 866 (May 2010, modified in June 2010) (Case also relates to Legal Challenges (F) Remedies and Part 3. Water Supplies and Supply Planning Role of Cities - (E) Evaluation of Water Supply for Development Projects) HOLDING: An EIR for an open-air human waste compost facility was invalid because it did not adequately analyze the feasibility of an enclosed composting facility and did not include a Water Supply Assessment ( WSA ). The court also upheld the award of attorneys fees to the petitioners under Code of Civil Procedure section DISCUSSION: An Inland Empire compost company proposed to develop and operate a new open-air compost facility on a 160-acre parcel of land in the Mojave Desert. Given the various adverse environmental effects of creating compost, the County prepared an EIR for the proposed facility. The County s planning commission certified the EIR and approved a conditional permit for construction. The plaintiff filed a petition for writ of mandate against the County for, among other things, the EIR s failure to (1) adequately evaluate feasible alternatives to the proposed facility and (2) describe how and from where the facility would get its water supply. The trial court determined that the County s EIR failed to adequately evaluate feasible alternatives for the project, and also failed to adequately identify the proposed project s source of water. The court issued a peremptory writ of mandate that enjoined the construction unless and until such time as

16 the County has certified and adopted an EIR that complies with CEQA. The developer appealed. Adequacy of County s Feasible Alternatives Analysis. Pursuant to CEQA, an EIR must list a range of reasonable alternatives to a proposed project that would feasibly attain most of the project s basic objections, while avoiding or substantially lessening any of its negative effects. The EIR must contain sufficient information about each alternative to allow for meaningful evaluation, analysis, and comparison with the proposed project. The mere stating of conclusions does not satisfy this requirement; the EIR must contain facts as well as analysis. There are two basic types of compost facilities: open-air facilities and enclosed facilities. In an enclosed facility, all the compost and resulting emissions are contained within the building, emitting 80% less of harmful gases than open-air facilities. In its EIR, the County summarily rejected the enclosed facility as financially and technologically infeasible. The County s conclusion relied primarily on a research memo that based all cost projections on a single enclosed facility, despite the fact that other such facilities existed. The court concluded that the EIR lacks any meaningful comparative data pertaining to a range of potential costs for enclosed facilities. In addition, the court found that the County s EIR contained no information as to why the enclosed facility is technologically infeasible other than a statement that the proposed site was one mile away from the closest electricity line. The court held that it is not a question of whether the site has access to electricity, it is a question of how much it would cost to get the site access to electricity. Given the EIR s shortcomings, the appellate court agreed with the lower court s determination that the County s EIR did not adequately evaluate the enclosed facility alternative. Adequacy of County s Water Supply Analysis. When a county determines that a proposed project is subject to CEQA and is also a project within the meaning of Water Code section 10912, a WSA is required. The purpose of a WSA is to ensure that local land use authorities thoroughly consider the availability of water supplies before approving major new developments. The appellate court agreed with the lower court s determination that this proposed compost facility is both subject to CEQA and falls within the definition of a project under the Water Code. As such, a WSA is required. It is undisputed that the County s EIR does not include a WSA. The County s EIR merely stated that the proposed facility will use well water and perhaps have additional water trucked to the site. Not only did County s EIR not include a WSA, it failed to indicate whether the developer drilled a well to determine the actual availability of water. The appellate court agreed with the lower court s determination that the County s EIR is inadequate for the additional reason that it does not include a WSA. Award of Attorneys Fees. The court rejected the compost company s argument that the petitioners should not be awarded attorneys fees. The trial court had determined that as a result of the challenge, the County would have to adequately consider an enclosed facility and identify the water supply for the facility, and as a result, the petitioners had vindicated important rights within the meaning of Code of Civil Procedure section The appellate court found no abuse of discretion in this determination. Given the harmful emissions caused by open-air human waste composting, requiring the County to meaningfully study the alternative of an enclosed facility that can cut emissions by 80% protected an important right pertaining to air quality. Further, in light of the overdraft condition of the underlying groundwater basin,

17 requiring the County to identify the source of water to be used for the facility before it approved the project was also important. Similarly, the court upheld the trial court s determination that the litigation resulted in substantial benefit to the general public. The court also upheld the amount of the award ($265,715). The trial court was not required to reduce the award based upon the fact that the petitioners had prevailed on only a few of their claims. The appellate court noted that the trial court had reduced the base or lodestar component of the award by approximately 40%. The trial court s application of a 1.5 multiplier based upon the contingent nature of the fee awarded also was upheld on appeal. The opinion has an extensive discussion of the factors the courts should consider in applying a multiplier Additional Types of EIRs and Negative Declarations (B) Subsequent EIRs and Negative Declarations San Diego Navy Broadway Complex Coalition v. City of San Diego, 185 Cal.app.4 th 924 (June 2010) HOLDING: Subsequent environmental analysis is not required in connection with a post-eir certification implementing action of narrow scope. DISCUSSION: In 1992, the City entered into a development agreement with the USA relating to the redevelopment of certain property in the City s downtown. The agreement anticipated millions of square feet of office, hotel, and related development. The agreement provided that a public nonprofit corporation be created to staff and implement the downtown redevelopment projects. The development agreement established a development plan and design guidelines that related to the aesthetic design of the project. The nonprofit was required to review the developer s proposals to make sure they were consistent with the aesthetic criteria established in the development plan and in the design guidelines. When the City approved the development agreement, it certified an EIR that analyzed the impacts of the redevelopment project. In 2006 and 2007, some 14 years after the EIR was certified, the developer submitted its construction plans to the nonprofit for the aesthetic consistency determination. In connection with its review, the nonprofit determined that no further environmental review was required. Petitioner challenged that determination. It claimed that before making the consistency determination, a subsequent EIR was required to address numerous issues, including impacts on water supply, public services, ground water, air quality, and the project s contribution to greenhouse gas/climate change. The court rejected this argument. Based upon the limited role being played by the nonprofit, the court held that subsequent environmental review was not required. It noted that an agency is required to prepare an EIR only when the agency has the authority to address the environmental concerns that might be raised in the EIR. Similarly, the requirement to prepare a subsequent EIR or a supplemental EIR arises only where the agency has discretion to respond to the environmental concerns raised in the new EIR, and where one of the circumstances of Public Resources Code section has occurred.