Third District Holds CEQA Does Not Require Recirculation Based On Staff-Recommended Alternative Raised After Preparation of Final EIR

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In a recent decision extensively analyzing and applying CEQA’s rules on alternatives analysis, recirculation, and a petitioner’s burden to show agency error, the Third District Court of Appeal affirmed the Nevada County Superior Court’s judgment denying a writ petition challenging a commercial real estate project. South County Citizens for Smart Growth v. County of Nevada (3d Dist., 10/8/13) ____Cal.App.4th _____, 2013 WL 5936664.

Plaintiff “Smart Growth” challenged County’s approval of the 20-acre Higgins Marketplace Project being developed by Katz Kirkpatrick Properties (KKP) in southwestern Nevada County. The Draft EIR (DEIR) analyzed subdivision of the site into 10 parcels, with approximately 80,000 square feet of retail uses, two fast food restaurants, 482 parking stalls, reservation of 5 acres for future development of 42,000 square feet of light industrial and office uses, and preservation of about 3.26 acres of wetlands with a 25-foot buffer. It identified three significant and unavoidable impacts – two traffic impacts and one cumulative air quality impact – and found all other impacts would be less than significant with mitigation. It analyzed four (4) project alternatives, including the CEQA-mandated no project alternative; a restricted turning access alternative to try to avoid SR 49 impacts; a business park alternative under current general plan designations (designed to reduce traffic and noise); and a redesign/reduced density alternative which would eliminate 6,500 feet of commercial development, relocate the fast food restaurants, and provide greater buffers to reduce biological, noise, visual and traffic impacts.

Following release of the Final EIR (FEIR), but prior to the Planning Commission’s hearing, County received four late comment letters – including one from Smart Growth’s attorneys – which it included and responded to in an FEIR appendix. The staff report for the Commission hearing recommended that the Commission vote to recommend to County’s Board of Supervisors a modified version of Alternative 4 (the “staff alternative”) which capped commercial development at 75,000 square feet, provided 10 acres of open space, increased the wetland buffer from 25 to 100 feet, and deleted the fast food restaurants. The Commission certified the FEIR and voted 3-2 to recommend the staff alternative to County’s Board of Supervisors.

Prior to the Board hearing, KKP addressed the Commission’s concerns by submitting two revised project proposals that also reduced the project footprint and eliminated the fast food restaurants. The Commission subsequently met twice, and based on its staff’s advice recommended (1) certification of the FEIR, and (2) approval of KKP’s second alternative proposal to the Board. The primary differences between the staff alternative and KKP’s second alternative were the retention of existing business park and office designations on about 4 acres of the reserved land, reduction of the wetlands setback by 30 feet, increase of commercial development by 800 square feet, and reduction of open space by about 4 acres.

After a lengthy “late hit” comment letter from Smart Growth’s attorney was delivered at the beginning of its hearing, the Board continued its hearing for over a month, and additional responses to comments were prepared and added to the FEIR by County’s consultants. The Board then held two hearings, certified the FEIR, and adopted the legislative approvals required for the project.

In affirming the trial court’s denial of Smart Growth’s writ petition challenging the Board’s actions under CEQA, the Third District rejected Smart Growth’s arguments that County erred by: (1) failing to recirculate a revised DEIR containing the staff alternative; (2) failing to expressly find that the staff alternative was infeasible; (3) finding traffic impacts were mitigated to less-than-significant by redesignating an affected road to a minor arterial; and (4) finding the revised project’s traffic impacts were less-than-significant.

The Court of Appeal’s decision in major part recited numerous important CEQA principles regarding alternatives analysis and recirculation that were central to its decision:

  • There is a distinction between (1) the determination during the scoping process to include project alternatives in the DEIR, and the adequacy of such alternatives, and (2) the determination whether to recirculate an EIR when significant new information is added concerning a feasible project alternative.
  • The doctrine of feasibility guides the determination of the scope of alternatives to be included in the DEIR. There is no categorical rule as to this scope, other than consideration of a reasonable range of alternatives under the flexible “rule of reason.” DEIR alternatives must be potentially feasible and offer substantial environmental advantages over the proposed project. Importantly, the “EIR is not required to set forth every conceivable alternative. . . given that in some cases “there are literally thousands of ‘reasonable alternatives’ to the proposed project.””
  • “The feasibility of a new alternative proferred after the scoping process, and after the [D]EIR is circulated is [only] one of the [many] factors to be considered in determining whether to recirculate an EIR. . . .”  CEQA requires recirculation “only when significant new information is added to the EIR after public notice is given of the availability of the [D]EIR for public review but before certification.”
  • “Significant new information” in this context means information added to an EIR that changes the EIR so as to deprive the public of a meaningful opportunity to comment on a “substantial adverse environmental effect” or a “feasible way to mitigate or avoid such an effect (including a feasible project alternative) that the project’s proponents have declined to implement.” An example of significant new information provided by the CEQA Guidelines is a disclosure showing a feasible alternative or mitigation measure “considerably different from others previously analyzed” which “would clearly lessen the [project’s] significant impacts. . . , but the project’s proponents decline to adopt it.” (Citing 14 CCR & 15088.5(a)(3).)
  • “[R]ecirculation is not required simply because new information is added [to the DEIR]” –  indeed, that is virtually always the case given CEQA’s post-DEIR circulation requirement of responses to public comments. Rather, recirculation “was intended to be an exception rather than the general rule.” (Citing Laurel Heights Improvement Assn. v. Regents of University of California (1993) 6 Cal.4th 1112, 1132.) Accordingly, “[a]n express finding is not required on whether new information is significant; it is implied from the agency’s decision to certify the EIR without recirculating it.” (Citing id. at 1133.)

Applying these rules and principles to the case before it, the Third District noted Smart Growth did not challenge the adequacy of the alternatives included and discussed in the DEIR after the scoping process, and did not challenge County’s failure to recirculate the FEIR with a discussion of the revised project; its only claim was that when the Planning Commission initially voted to approve the staff alternative, County should have prepared and recirculated a revised DEIR containing that alternative, and that its failure to do so deprived the public of an opportunity to comment on a feasible alternative in violation of CEQA’s mandatory disclosure procedures. However, Smart Growth cited no authority requiring that, where an EIR already includes a reasonable range of alternatives, any additional alternative – even if first proferred after the FEIR is released – must be added to the EIR to comply with CEQA’s disclosure requirements.

Smart Growth failed to carry its burden to prove a “double negative” – i.e., to show County’s decision not to revise and recirculate the FEIR was not supported by substantial evidence – because it failed to demonstrate evidence was lacking to negate any of the four distinct constituent elements of “significant new information.” These elements included, but were not limited to, the requirement that the new alternative be “considerably different from other alternatives previously analyzed.” The Court pointedly noted Smart Growth failed to meet its “appellate burden” in this regard, i.e., its burden to “lay out the evidence favorable to the other side and show why it is lacking.” While it generally argued that “the staff alternative allows for more open space,” Smart Growth “fail[ed] to explain, with reasoned analysis supported by citations to the evidence in the record, why this specific increase in open space is considerably different.” Moreover, Smart Growth’s attempt to rectify in its reply brief its fatal error (of failing to meet its appellate burden) was unavailing and “too late. . . because it deprives the respondent of the opportunity to respond.” Smart Growth also failed to “provide any analysis justifying its position that only potential feasibility, as opposed to actual feasibility, is required at this late stage of the CEQA process, under circumstances where there is no claim that the [D]EIR lacked adequate reasonable alternatives, the [D]EIR had been circulated for public discussion, and the staff alternative was not raised until after the [F]EIR was submitted for certification.”

Smart Growth further failed to cite any CEQA authority “requiring that the lead agency make findings regarding why it rejected an alternative proposed after the final EIR [was prepared] and not included in the EIR.” Nor was County required to make an express finding of infeasibility, as Smart Growth argued, but only that the staff alternative was not significant new information – a finding properly implied from its decision not to recirculate the DEIR.

Finally, in a portion of its opinion concerning the traffic baseline, the Court held substantial evidence supported County’s treatment of a road affected by the project as a “minor arterial” based on actual existing traffic conditions, rather than under its existing inaccurate designation as a “major collector.” Further, County’s assumptions that a previously planned and funded expansion of that road would occur were reasonable and based on substantial evidence, and they were not – and didn’t need to be – included as a mitigation measure.

You might be thinking there is some irony in this decision involving an entity named “Smart Growth” which makes late comments on a DEIR; delivers a lengthy “late hit” letter resulting in delay of a Board hearing on the FEIR and project; fails to raise predicate alternatives arguments essential to its primary claims; and attempts to carry its appellate burdens for the first time in a reply brief to which respondents are unable to respond – all while attempting to invoke CEQA’s recirculation rules, which are intended to prevent the public agency from “hiding the ball” from the public when significant new information is added to an EIR after the public comment period. If so, the irony is elegantly understated, and the Third District’s careful legal analysis speaks eloquently for itself.

Topics:  CEQA, Environmental Impact Report, Environmental Policies

Published In: Civil Procedure Updates, Environmental Updates, Commercial Real Estate 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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