In a partially published opinion filed on September 7, 2023, the Third District Court of Appeal affirmed a judgment denying a CEQA challenge to Sacramento County’s approval of a mixed-use development project known as the Mather South Community Master Plan (the “project“); if implemented, the project would result in, inter alia, up to 3,522 residential dwelling units; 225,000 square feet of retail space; 49 acres of environmental education campus and research and development park uses; two elementary schools; and about 200 acres of parkland and open space areas on an 848-acre site. The issues on appeal were limited to the adequacy of certain aspects of the project EIR’s analyses of GHGs and criteria air pollutants. Tsakopoulos Investments, LLC v. County of Sacramento, et al. (Mather South, LLC, et al, Real Parties) (2023) ___ Cal.App.5^th ___. (The unpublished portion of the opinion: (1) upheld the EIR’s qualitative analysis concluding that, with compliance with the State’s Low Carbon Fuel Standard and other air quality mitigation measures, construction-related GHG impacts would not be significant; and (2) concluded the EIR adequately explained, in compliance with the Supreme Court’s decision in Sierra Club v. County of Fresno (2018) 6 Cal.8^th 502, why it was not feasible to correlate the level of the project’s air emissions to specific human health impacts from the project. In keeping with this blog’s practice, this post will not further discuss these unpublished portions of the Court’s opinion, except to note that they appear worthy of publication, and that the Court’s docket reflects that a request to publish was filed by Remy Moose Manley LLP on September 18, 2023. So stay tuned on that front…)

The Court of Appeal’s Opinion

The gist of the case’s narrow holding reflected in the published portion of the opinion is that the EIR’s climate change analysis did not employ a methodology previously rejected for lack of substantial evidence in Center for Biological Diversity v. Department of Fish & Wildlife (2015) 62 Cal. 4^th 204 (“Center For Biological Diversity”) (analyzed in my 12/2/15 post here) and Golden Door Properties, LLC v. County of San Diego (2018) 27 Cal.App.5^th 892 (“Golden Door”) (analyzed in my 10/8/18 post here).

As relevant regulatory background, the CEQA Guidelines state that the lead agency has discretion, in the context of a particular project, to quantify the project’s GHG emissions and/or to rely on a qualitative analysis or performance-based standards. (CEQA Guidelines, §15064.4(a).) In assessing the significance of a project’s GHG emissions, the Guidelines provide that the agency should consider several factors, including: whether the project increases or reduces GHGs compared to the existing environmental setting; whether the emissions exceed a threshold of significance the agency determines applies; and the extent to which the project complies with regulations or requirements adopted by a relevant public agency through a public review process to implement a statewide, regional or local GHG emissions reduction plan. (§15064.4(b).)  The agency has discretion to select a model or methodology for estimating project GHGs that is supported by substantial evidence. (§15064.4(c).)

In Center for Biological Diversity, the Supreme Court rejected, as unsupported by substantial evidence, an EIR’s use of a GHG significance threshold for a large mixed-use development project that posited a reduction of 31% from project-level business-as-usual (“BAU”) emissions was not significant because it was consistent with and a greater percentage reduction than CARB’s 2008 Scoping Plan’s statewide standard of a 29% reduction from BAU. No record evidence or expert opinion supported the EIR’s assumption that the required GHG emissions reduction for an individual development project was the same as for the entire state population and all sectors of the economy, i.e., no substantial evidence or cogent explanation validated the EIR’s assumption of an “apples-to-apples” quantitative comparison. In Golden Door, the Fourth District similarly struck down San Diego County’s GHG threshold of 4.9 metric tons of carbon dioxide equivalent (MTCO₂e) per service population for development projects because the record lacked substantial evidence that the threshold, which relied on statewide service population and GHG inventory data, was appropriate to apply to San Diego County development projects.

By contrast to the scenarios in Center for Biological Diversity and Golden Door, Sacramento County’s project EIR incorporated GHG significance thresholds from County’s earlier 2011 General Plan EIR, which derived its thresholds from relevant and comprehensive regional data on the GHGs emitted from all different sectors of GHG contributing activities within the region (e.g., residential, commercial, industrial, transportation, agriculture, etc.).  The 2011 General Plan EIR ultimately established three thresholds of significance—one for residential, one for commercial and industrial, and one for transportation activities—based on the strategy and assumptions underlying AB 32’s year 2020 GHG emissions reduction goal, estimated in the 2008 Scoping Plan as 15% below 2005 levels. In addition to incorporating the 2011 General Plan EIR and its significance thresholds, and discussing the relevant legal and regulatory framework, the project EIR divided the project’s operational GHG emissions into two sectors—energy use and transportation—and updated the 2020 thresholds to 2030 thresholds to reflect SB 32’s reduction targets (40% below 1990 levels by 2030, and 80% below 1990 levels by 2050) using the same General Plan EIR methodology used to develop the 2020 thresholds. Impacts from energy-related GHGs from residential and from non-residential land uses, and from transportation were separately assessed and quantified, with GHG emissions from all sectors also totaled.

The EIR concluded the project’s energy-related residential land use GHG emissions would be .52 MTCO₂e per capita (below the .73 threshold); energy-related non-residential land use GHG emissions would be 2.28 MTCO₂e per 1,000 square feet (below the 4.28 threshold); and transportation emissions would be 2.50 MTCO₂e per capita by 2032 (above the 1.47 threshold). While the “surplus” of emissions reductions from the residential and non-residential sectors would effectively reduce the mobile sector’s emissions to 2.05 MTCO₂e per capita, an additional reduction of 5,289 MTCO₂e per year would still be needed to meet the threshold, so the project would still exceed applicable County thresholds of significance for transportation and result in a cumulatively considerable (and therefore significant) climate change impact. (The County adopted three mitigation measures not at issue in the appeal.)

The Court of Appeal held the EIR’s GHG climate change analysis, and specifically its challenged methodology for developing the 2032 thresholds of significance, did not suffer from the same flaws found in the Center for Biological Diversity and Golden Door decisions. It rejected appellant’s arguments that the County employed “the same methodology” and “significance thresholds indistinguishable” from those involved in those cases. Rather, framing its conclusion as a “narrow” one addressed to appellant’s “narrow” arguments, it found County’s thresholds of significance distinguishable on numerous grounds. Preliminarily, a BAU methodology is not impermissible per se, but only if it is unsupported by substantial evidence. Second, the Supreme Court never held that new land use projects must incorporate greater percentage GHG emissions reductions than the economy as a whole to achieve state targets, only that such may be the case.

Unlike in Center for Biological Diversity, the County here did not simply compare the project’s GHG emissions to the statewide BAU goal; it “instead developed county-specific thresholds of significance for different sectors and then compared the project’s emissions against those thresholds[,]” a use of numerical thresholds recognized as a potentially permissible lead agency option by the Supreme Court, and one expressly sanctioned by CARB in its 2017 Scoping Plan. CARB thus stated in that plan that: “Since the statewide per capita targets are based on the statewide [GHG] emissions inventory that includes all emissions sectors in the State, it is appropriate for local jurisdictions to derive evidence-based local per capita goals based on local emissions sectors and population projections that are consistent with the framework used to develop the statewide per-capita targets.” The Court found that the County did just that in developing its 2032 GHG thresholds of significance, using the same framework (but not the same data) as CARB used in its 2008 Scoping Plan, and using “county-specific emissions inventories, and county-specific population and housing, commercial, and industrial data.”

Also, unlike the scenario in Center for Biological Diversity, the County did not use a quantitative comparison method developed by the Scoping Plan as a measure of the GHG reduction effort required by the State as a whole and apply it without changes or adjustments to a specific land use development and project. Further, not only was County’s methodology different, but the record evidence supporting it was different, since the 2017 Scoping Plan arguably provided substantial evidence supporting it—an issue the Court found it need not decide, however, because appellant’s narrow argument did not raise it.

The County’s thresholds were also distinguishable from the threshold rejected in Golden Door because they were developed with county-specific data, and rather than being “applied evenly to most project types” the Sacramento County thresholds were developed for different sectors and then compared to an individual project’s estimated GHG emissions in each of those sectors, which accounted for variations between different types of development.

The Court went on to reject other of appellant’s unrelated arguments as not preserved through proper brief headings identifying the issues.

The Court concluded its published analysis of its “narrow” holding as follows: “At bottom, the County’s methodology in establishing the thresholds of significance in this case was materially different from the methodologies used in Center for Biological Diversity and Golden Door Properties. The County’s methodology was accordingly not previously rejected by our Supreme Court or the Fourth District Court of Appeal, as [appellant] asserts. [Appellant] has thus failed to carry its burden of proving the County’s methodology lacked substantial evidence, and we presume the [GHG] emissions analysis in the final report is adequate.”