Welcome to “CEQA News You Can Use,” a quarterly production of Brownstein Hyatt Farber Schreck, LLP’s Natural Resources lawyers. This publication provides quick, useful bites of CEQA news, which we hope can be a resource to your real-time business decisions. That said, it is not and cannot be construed to be legal advice. Enjoy!

Challenges to EIR for State Water Project contract extensions don’t hold water

In the 1960s, the Department of Water Resources (DWR) entered into 75-year agreements with 29 local government contractors to provide State Water Project (SWP) water supplies. With impending contract termination dates constraining its ability to issue revenue bonds with customary 30-year maturity dates, DWR and the contractors negotiated extensions and in 2018, following certification of its Final EIR, DWR approved the contact amendments extending the contract terms to 2085 and modifying several financial provisions. The North Coast Rivers Alliance and Planning and Conservation League (appellants) challenged the project, raising a laundry list of CEQA issues, including that the EIR relied on an improper baseline by evaluating impacts against a world in which the contracts exist, improperly piecemealing by not analyzing the impacts of future diversion projects the contracts may help facilitate, failure to consider cumulative impacts, and failure to properly analyze the no project alternative. Ultimately, in a 51-page published opinion chock-full of CEQA takeaways (Planning and Conservation League, et al v. Department of Water Resources, et al, etc. (2024) 98 Cal.App.5th 726), the Third District Court of Appeal rejected each and every CEQA argument and found that the appellant’s non-CEQA claims lacked merit. DWR’s EIR was upheld and the water supply contract amendments were left afloat.

The first Notice of Determination is the one that counts for phased project

CEQA provides for a 30-day statute of limitation from the filing and posting of a notice of determination (NOD). When a project is phased or changes are proposed to address environmental concerns, however, each phase or modification can be followed by a NOD. In Guerrero et al. v. City of Los Angeles (2024) 317 Cal.Rptr.3d 347, the Second District Court of Appeal reviewed a legal challenge to a residential project that began when the City of Los Angeles approved a vesting tentative map and mitigated negative declaration (MND), for which it filed a NOD in March 2020. Subsequent project actions followed, including the city’s approval of a zone change, for which it filed another NOD in June 18, 2021. Project opponents filed suit on July 16, 2021, based on the June 18 NOD. The court reversed the trial court, holding that the suit was filed too late because the city’s first NOD triggered the statute of limitations, and the June NOD did not restart the limitations period on the project.

Don’t sell your writ powers short, trial court

In 2001, the Los Angeles Harbor District approved a permit for construction and operation of the China Shipping Container Terminal in the Port of Los Angeles. The project has sailed the rough seas of ongoing CEQA litigation ever since, facing challenges from community and environmental groups and the South Coast Air Quality Management District. The trial court determined that a 2019 supplemental environmental impact report (SEIR) for the terminal that had been certified by the City of Los Angeles failed to adequately analyze the project’s emissions impacts, failed to ensure mitigation measures were enforceable, and improperly deleted or modified previously adopted mitigation measures. The trial court did not, however, order any remedial measures beyond ordering Los Angeles to prepare a revised SEIR. In Natural Resources Defense Council, Inc. v. City of Los Angeles (2023) 98 Cal.App.5th 1176, the Fourth District Court of Appeal reversed, finding that the city’s failure to adopt additional mitigation measures violated CEQA, and further held that the trial court misunderstood the scope of its own remedial powers. The court held that the trial court was not limited to setting aside the SEIR and directing preparation of a new one—instead, it has broad equitable powers to fashion a remedy consistent with CEQA’s purposes, including setting a strict timeline for preparing a new SEIR and ordering suspension of project activities in the interim unless mitigation measures are complied with.

Developer tops County Supervisors’ decision to require an EIR

In Hilltop Group, Inc. v. County of San Diego (2024) 99 Cal.App.5th 890, Hilltop applied for a permit to build a recycling center on land identified for high-impact industrial uses in San Diego County’s 2011 General Plan. After preparing a draft EIR, however, Hilltop advised the county that the project was exempt from CEQA pursuant to CEQA Guideline section 15183, an exemption for projects consistent with a community plan, general plan or zoning. Although county staff and the planning commission agreed that the exemption applied, the San Diego County Board of Supervisors ordered preparation of an EIR. Applying the substantial evidence standard to whether the exemption applied, the Fourth District Court of Appeal concluded that the Board of Supervisors did not proceed in the manner required by CEQA. Rather than requiring an EIR, the Board of Supervisors should have limited its review to the project’s conformity with CEQA Guideline section 15183. Hilltop thus stands as a rare example of a CEQA decision overturning an agency’s determination to require an EIR instead of relying on an exemption.

Agricultural conservation easements qualify as compensatory mitigation 

In V Lions Farming, LLC v. County of Kern (2024) 100 Cal.App.5th 412, the Fifth District Court of Appeal considered for a second time whether Kern County had complied with CEQA in approving an ordinance streamlining the permitting process for new oil and gas wells. (See King & Gardiner Farms, LLC v. County of Kern (2020) 45 Cal.App.5th 814 [first appeal].) In the first appeal, the court concluded that agricultural conservation easements (ACEs) were not effective at reducing a project’s conversion of agricultural land to a less than significant level for purposes of CEQA—because they do not replace the lost agricultural acreage. In the second appeal, the court clarified that CEQA’s purpose of providing long-term protection of the environment is better served if ACEs qualify as direct compensatory mitigation for purposes of CEQA Guidelines section 15370(e), which defines mitigation to include “compensating for the impact by ... providing substitute resources.” The court joined the First District, which interpreted the phrase “providing substitute resources” to encompass ACEs. (See Masonite Corp. v. County of Mendocino (2013) 218 Cal.App.4th 230, 238.) “Thus, ACE’s qualify as compensatory mitigation, even though they do not replace or otherwise offset the acres of agricultural land converted by the project—that is, they do not ensure the project results in no net loss of agricultural land.”