Public Agency May Begin Eminent Domain Proceedings Before Completing CEQA Review, But May Not Actually Acquire The Property Until After CEQA Compliance

A racetrack landowner challenged a regional park district’s plan to condemn part of the property for construction of a bayside trail, asserting that the park district was required under eminent domain law and the California Environmental Quality Act to complete environmental review first.  The trial court agreed that the project was required to undergo environmental review before the property was acquired by the park district, but that the park district could begin eminent domain proceedings before environmental review.  In a partially published opinion, the First District Court of Appeal upheld the trial court decision.  (Golden Gate Land Holdings LLC v. East Bay Regional Park District (--- Cal.Rptr.3d ----, Cal.App. 1 Dist., April 12, 2013).

Facts

Golden Gate Land Holdings LLC (“Golden Gate”) owns the Golden Gate Fields racetrack and the parcel it sits upon on the east shore of San Francisco Bay.  Beginning in 2003, the prior owner of the property made a license agreement with East Bay Regional Park District (“District”) to allow recreational public access to the property.  The license eventually expired, but the new owner, Golden Gate, continued to allow public access informally.  Because part of the public access runs through the racetrack parking lot and main access road, recreational users  faced dangerous conditions crossing through racetrack traffic. 

As part of a park and shoreline trail project enacted by the state legislature, the District sought to acquire approximately eight acres out of the 140-acre Golden Gate parcel to complete a state park and to extend the San Francisco Bay Trail, which is planned to eventually encircle all of San Francisco and San Pablo Bays.  The District planned to reroute recreational use onto a trail and prepared engineering plans and cost estimates to try to voluntarily acquire the property.  Golden Gate rejected a long-term licensing offer and then a purchase offer from the District.  The District prepared to condemn the property, which included one 2.8 acre area to be taken in fee title, and another 4.8 acre area over which the District would hold a perpetual, non-exclusive easement.

At a noticed public hearing, the District Board of Directors considered and approved a resolution of necessity to authorize eminent domain proceedings on the property.  District staff issued a report stating that the trail plan would provide a safe, scenic, ADA-compliant recreation route for the public and that the project was exempt from the California Environmental Quality Act (“CEQA”).  Golden Gate objected to the plan, argued that it was not exempt from CEQA, and asserted the District must go through the full CEQA environmental review process.  Two days after approving the resolution of necessity, the District posted a notice of exemption stating that the project was exempt from CEQA pursuant to CEQA Guidelines section 15325 because it was aimed at protecting open space, which would not impact the environment, and that any future development would be subject to CEQA review.

Golden Gate filed a petition for writ of mandate and a complaint for injunctive relief in state superior court to halt the District’s plan.  Golden Gate asserted that the District violated CEQA by erroneously finding the trail plan exempt from environmental review and that the District violated eminent domain law by making findings in the resolution of necessity that were unsupported by the evidence.

The trial court partially granted Golden Gate’s petition for writ of mandate, setting aside part of the District’s resolution of necessity that found the trail project exempt from CEQA.  The trial court agreed with Golden Gate’s contention that the District had approved a “project” under the CEQA definition and that the project was not exempt from environmental review.  The trial court reasoned that the trail land acquisition could not be considered apart from the trail building; to do so would be improper “piecemealing” of the project.  However, the trial court also found that the District could go forward with eminent domain proceedings as long as it did not actually acquire the property until after CEQA environmental review was complete.

The trial court acknowledged that there was disagreement in published cases on whether CEQA review must be complete before issuing a resolution of necessity and beginning eminent domain proceedings.  The trial court noted that CEQA law and eminent domain law serve different purposes:  CEQA focuses on physical change in the environment, while eminent domain focuses on ownership of property.  For example, if the government condemns property but makes no change to its use or physical characteristics, CEQA does not come into play.  Further, in examining the CEQA Guidelines, the trial court found that they permit an “acquisition agreement” before CEQA approval, but not an actual “acquisition.”  Finally, the court noted that the District would still have to comply with the CEQA review process, including considering or implementing mitigation measures or alternatives to the project.  Golden Gate appealed.

Decision

In a partially published opinion, the First District Court of Appeal upheld the trial court decision.  The appellate court noted that while the appeal was pending the District conceded that it had to perform CEQA review and had attempted to vacate its original resolution of necessity and file a new one that stated the District had certified an Environmental Impact Report (EIR) for the project.  The District pointed to the new materials as proof that it was now complying with CEQA and the case was moot.  The court of appeal refused to take notice of the new resolution of necessity, stating that it was irrelevant to one of the central issues in the appeal:  whether the District’s resolution should be set aside altogether rather than only partially.  However, the court also rejected Golden Gate’s argument that the trial court’s decision allowed an “after-the fact review” of the project.

The appellate court noted that the question was not whether an EIR must be prepared, but when it must be prepared if eminent domain is involved in a CEQA project.  The appellate court approved the trial court’s interpretation of CEQA Guidelines section 21168.9 as mandating courts to tailor a remedy to the exact circumstances of case, either to halt a project altogether or to allow some portions go forward while the agency revises its actions regarding the offending portions.  The appellate court took a close look at a number of CEQA court cases, noting several that allowed existing operations to continue while pausing new activity or development until the agency came into compliance with CEQA.  For example, in Laurel Heights Improvement Assn. v. Regents of University of California (1988) 47 Cal.3d.376, the California Supreme Court allowed existing laboratory activities at a University of California medical research center to continue while enjoining expansion until a new EIR was certified.  In City of Santee v. County of San Diego (1989) 214 Cal.App.3d 1438, the appellate court allowed a county to continue operating an existing temporary jail until a new EIR was certified for jail expansion plans.

The court also observed that case law clearly stated that CEQA does not require preparation of an EIR simply to condemn property for open space or park use.  Although the District’s plan also included recreational improvements such as trail building, fencing, and drainage work, this project was clearly distinguishable from cases cited by Golden Gate in which the central purpose of a project was to make physical changes to the environment, such as for a residential development (City of Stockton v. Marina Towers LLC (2009) 171 Cal.App.4th 93, San Joaquin Raptor/Wildlife Rescue Center v. County of Stanislaus (1994) 27 Cal.App.4th 713), airport runway (Burbank-Glendale-Pasadena Airport v. Hensler (1991) 233 Cal.App.3d 577), or expansion of a water service system (City of San Jose v. Great Oaks Water Co. (1987) 192 Cal.App.3d 1005).  The court noted that because the trial court specifically required completion of CEQA review before acquisition of the property, the expenditure of funds for the property would not be a factor pressuring the District to “ignore environmental concerns.” 

Finally, the court rebuffed Golden Gate’s contention that the District violated eminent domain law by adopting the resolution of necessity.  Golden Gate argued that the District neglected to find, as required by law, that condemnation of the property was in the public interest and a necessity.  The appellate court pointed to the words of the resolution itself stating the findings.  Golden Gate asserted that the District failed to follow its own internal pre-condemnation procedures, but the court rejected the contention, finding that Golden Gate had cited no legal authority stating that such a failure would cancel a resolution of necessity that complied with external legal requirements.  Further, looking at the record, the court found no evidence that the District had in fact violated its internal procedures.

Questions

If you have any questions concerning the content of this Legal Alert, please contact the following from our office, or the attorney with whom you normally consult.

Jeffrey L. Massey, Leslie Z. Walker or William T. Chisum | 916.321.4500

Jon E. Goetz | 805.786.4302

Topics:  CEQA, Compliance, Eminent Domain, Environmental Impact Report, Environmental Review

Published In: Civil Procedure Updates, Environmental Updates, Zoning, Planning & Land Use Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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