Attorneys are undoubtedly familiar with the adage that “bad facts make bad law.”  When an agency makes a general plan consistency determination, bad facts can also result in a court concluding that the deference typically owed to the agency’s exercise of its land use discretion has exceeded its limits.

On December 15, 2016, in a case keenly followed by land use practitioners throughout California, the state Supreme Court rejected the City of Orange’s determination that a 39-unit residential development project in the Santa Ana Mountains is consistent with its current 2010 General Plan even though the plan designates the property as open space because a resolution from a 1973 specific plan purports to allow residential development on the property.  Orange Citizens for Parks and Recreation v. Superior Court of Orange County, __ Cal.4th __ (2016) (Case No. S212800).  The case is replete with facts that gave the Court reason to conclude the City abused its discretion because “no reasonable person could interpret that plan to include the 1973 resolution.”

• The Planning Commission resolution recommending approval of the Orange Park Acres Specific Plan also recommended certain text changes, including designating the property as “Other Open Space and Low Density (1 acre)” instead of “Open Space” and that the specific plan be adopted as “representing a portion of the land use element of the General Plan”;
• The City Council adopted the Specific Plan and “upheld” the Planning Commission recommendation, but the City never actually implemented those text changes;
• The General Plan was comprehensively updated in 1989, designating the property “Open Space/Golf,” and again in 2010, designating the property “Open Space”;
• The 2010 General Plan states that specific plans “must be consistent with the policies expressed” in the land use element of the current General Plan;
• The current General Plan designates the property as “Open Space”;
• The developer and City each believed a general plan amendment would be needed to develop the property, and they acted accordingly;
• The subject development application sought, among other things, to change the General Plan land use designation from “Open Space” to “Estate Residential”;
• The draft Environmental Impact Report for the project included the proposed general plan amendment in its analysis;
• Several years into processing the application the City was made aware of the 1973 resolution and belatedly changed course, concluding that the text changes the Planning Commission recommended were never made simply as a result of “clerical oversight,” and that such error could not change the fact that the true land use designation for the property was “Other Open Space and Low Density (1 acre)” and not “Open Space”;
• 56% of the voters of the City approved a referendum petition rejecting the proposed general plan amendment.

The Court of Appeal for the Fourth Appellate District affirmed the project’s approval, deferred to the City’s consistency finding, and held that substantial evidence supported the City’s decision.  Although the Court identified various “contradictions and ambiguities that call into question the possibility of definitively determining the land use designation of the Property in the general plan,” it ultimately held that this uncertainty counseled in favor of deferring to the City Council’s judgment.

The Court of Appeal also held that despite the persistence of “erroneous information” in the 2010 General Plan, the successful referendum vote “does not alter the reasonableness of the City Council’s conclusion that the open space designation is an error and not a substantive inconsistency.”  The court reasoned that because the City has the power to “fix errors” in the Specific Plan and policy map by reference to previously adopted City Council resolutions, the amendment did not prevent the City from finding the project consistent with the General Plan.

In its briefs to the California Supreme Court the developer argued that an amended Specific Plan has been continuously in effect since 1973, so the voters’ rejection of the general plan amendment via referendum petition merely preserved the status quo of the property as zoned for open space and residential development.  Orange Citizens argued that the property’s designation is solely open space, as determined by the text and maps in the publicly available version of the 2010 General Plan, so the voters’ rejection of the general plan amendment means that the property remains open space.

The Supreme Court opinion provided several pages citing to key principles regarding the purpose, structure, and public role in adopting and amending general plans.  And the Court noted that reviewing courts must defer to a procedurally proper consistency finding unless no reasonable person could have reached the same conclusion.

Against this legal backdrop, the Court reasoned that the invalidity of the City’s consistency finding is evident from the text of the 2010 General Plan and the City’s and developer’s own understanding of it.  The Court was particularly concerned that members of the public who requested the City’s General Plan at the time relevant here would have received the 2010 General Plan, which unambiguously designates the property as open space and makes clear that the Specific Plan “must conform to General Plan policy” and “must be consistent with the policies expressed in [the Land Use] Element.”  Likewise, any member of the public who requested a copy of the Specific Plan would have received the unamended Specific Plan designating the property for use as a golf course or open space.

The Court thus held that Orange Citizens has the better argument, reasoning that “[w]ith such a specific land use designation for the Property, and without any competing designations, policies, or extant amendments to the contrary, no reasonable person could conclude that the Property could be developed without a general plan amendment changing its land use designation.”

The Court noted that the City could have chosen to structure its current General Plan differently—indeed “in any form it chooses”—and that it could have chosen to allow residential development on the property, but given that it did not “[w]e must conclude that the 2010 General Plan means what it says: The Property is designated as open space.”

The Court concluded its opinion with an important point regarding the referendum petition, which is plainly a fundamental reason it decided to grant review in this single-issue general plan consistency decision:

“If legislative bodies cannot nullify the referendum power by voting to enact a law identical to a recently rejected referendum measure, then the City cannot now do the same by means of an unreasonable administrative correction to its general plan undertaken with intent to evade the effect of the referendum petition.”

Orange Citizens is a noteworthy new general plan consistency decision, and it highlights the limits of the deference courts will give to an agency’s exercise of its land use discretion, particularly when there are myriad facts that undermine that discretion.  Importantly, however, the case does not change or weaken the law regarding the broad deference agencies continue to have in interpreting and applying their own general plan policies.