Environmental Leadership Development Project (ELDP) Eligibility Criteria: A Checklist

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As previously reported, California Senate Bill (SB) 7, the Jobs and Economic Improvement Through Environmental Leadership Act of 2021, was signed into law by Gov. Gavin Newsom on May 20, 2021, and became effective immediately. (See Holland & Knight's previous alert, "SB 7 Creates Expedited CEQA Litigation Schedule for Qualifying Projects," May 28, 2021.) SB 7 extends the expiration date of Assembly Bill (AB) 900, the Environmental Leadership Development Project (ELDP) certification program, to Jan. 1, 2024. As extended, the law authorizes the governor to certify certain qualifying projects for California Environmental Quality Act (CEQA) benefits, including housing projects. Once certified, a project receives reduced time for the resolution of trial and appellate court CEQA lawsuits, from approximately three years to 270 days.

To qualify for ELDP certification, a project must meet a number of stringent labor and environmental requirements. Below is a checklist of key requirements:

Criteria Category

ELDP Eligibility Criteria
California Public Resources Code (PRC) § 21183

Meets Criteria? (Yes/No)

Location Criteria
PRC § 21180(b)(1)
PRC § 21061.3

Only Infill Project Sites Are Eligible (PRC § 21061.3)

  1. Project site has previously been developed for urban uses (residential, commercial, etc.)
  2. Site has not been previously developed, but is immediately adjacent on all sides with developed urban use sites, or
  3. Site has not been previously developed, but is immediately adjacent to developed urban sites on at least 75 percent of project site perimeter and remaining 25 percent of perimeter was previously developed for urban uses

Note: A clean renewable energy or clean energy manufacturing project does not need to meet these criteria.

☐ Yes
☐ No

Investment Size
and Use Criteria

PRC § 21180(b)

  1. Project must result in minimum investment of $100 million in California upon completion of construction and is a:

    a. retail, commercial, sports, cultural, entertainment or recreational project

    b. clean energy manufacturing project that manufactures products, equipment or components used for renewable energy generation, energy efficiency or the production of clean alternative fuel vehicles

    c. clean renewable energy (solar or wind generation) project, or

    d. housing development project that is completely residential, transitional/supportive housing or mixed use, with at least two-thirds of square footage used for residential uses but excluding any manufacturing or industrial use

☐ Yes
☐ No

  1. Project results in a minimum investment of $15 million but less than $100 million in California upon completion of construction and is a:

    a. housing development project with a minimum of 15 percent affordable housing units (or a higher affordable housing percentage if required by the city or county)

Note: Except for residential hotels, "no part" of the housing project may be used for a short-term rental unit (less than 30 days) or as a hotel, motel, bed or breakfast, or other transient lodging use.

☐ Yes
☐ No

Labor Criteria
PRC § 21183(b)

  1. Project provides an enforceable commitment to create high-wage, highly skilled jobs that pay prevailing wages and living wages by meeting the following project labor eligibility criteria in PRC § 21183.5:

    a. If the project is undertaken by public agency, or is a "public work" (e.g., infrastructure) project undertaken by a private party, that project must commit to using a "skilled and trained workforce"

    b. If the project is a private project, rather than a public work project, applicant shall "ensure":

    1. i. a "skilled and trained workforce" (union members) is used for all project construction work including by contractors/subcontractors(Pub. Contr. Code § 2600 et seq.)

      ii. all construction workers are paid prevailing wages (except certified apprentice program participants are paid apprentice wages) for all project construction work, including by contractors/subcontractors, and

      iii. either the project has a Project Labor Agreement with an enforcement (through arbitration) provision or the project files monthly compliance reports with the state and is subject to civil penalties of $200 per day per worker for violations

a. ☐ Yes
☐ No

b. ☐ Yes
☐ No

Environmental Criteria
(Citations provided
for each)

Project is certified as Leadership in Energy and Environmental Design (LEED) gold or better by U.S. Green Building Standard (PRC § 21180(b)(1))

Note: This criterion only applies to residential, retail, commercial, sports, cultural, entertainment or recreational projects.

☐ Yes
☐ No

  1. Project achieves a 15 percent greater "transportation efficiency" than comparable projects. Transportation efficiency is measured by the number of vehicle trips (not vehicle miles traveled) made by employees, visitors or customers divided by the total number of employees, visitors and customers. (PRC § 21180 (b)(1))

Note: This criterion only applies to residential, retail, commercial, sports, cultural, entertainment or recreational projects.

☐ Yes
☐ No

  1. Project is consistent with the use designation, density, building intensity and applicable standards specified for the project area in the regional sustainable communities strategy (or alternative planning strategy) as approved by the regional transportation agency and concurred in by the California Air Resources Board (CARB) as meeting regional greenhouse gas (GHG) reduction targets. (PRC § 21180 (b)(1))

Note: This criterion only applies to residential, retail, commercial, sports, cultural, entertainment or recreational projects.

☐ Yes
☐ No

  1. For multifamily housing projects (with potential exceptions for affordable housing units), project "unbundles" parking spaces (parking spaces must be separately priced, and not included in purchase price or otherwise require future residents to acquire)

☐ Yes
☐ No

  1. Project results in no net additional emissions of GHGs, including GHG emissions from employee transportation. (PRC § 21183(c); 21183.6).

    a. For any ELDP except smaller residential projects (see below), the GHG emissions and mitigation are quantified as follows:

    1. i. the "baseline" for measuring project increases in GHG is existing physical conditions, or must be otherwise consistent with CEQA Guidelines § 15125 as those regulations existed on Jan. 1, 2021.

      ii. Mitigation measures to achieve the required GHG reductions to net zero GHG must be prioritized as follows:

      1. 1. direct emission reductions from the project itself that also reduce emissions of criteria pollutants and toxic air contaminants

        2. if mitigation of all GHG impacts is infeasible through No. 1 above, then remaining impacts shall be mitigated through direct offsite reductions, within the same air district or basin as the project, that also reduce criteria and/or toxic air emissions

        3. if mitigation of all GHG impacts is infeasible through Nos. 1 and 2 above, then remaining impacts shall be mitigated by funding "offsets" from sources that provide a specific, quantifiable and direct environmental and public health benefit to the region in which the project is located (consistent with Health and Safety Code § 38500)

        4. remaining unmitigated impacts shall be mitigated through the use of offsets that originate from sources that provide a specific, quantifiable and direct environmental and public health benefit to the region in which the project is located

  1. b. For smaller housing projects ($15 million to $100 million) meeting inclusionary affordable housing requirements, the above mitigation sequencing and baseline requirements noted above are not mandated

    c. For some prior ELDP applications, the governor has asked CARB to make no net GHG determination (PRC § 21183(d))

☐ Yes
☐ No

  1. Project demonstrates compliance with waste recycling and composting statutory mandates. (PRC § 21183(d); PRC § 42649 et seq.; PRC § 42649.8 et seq.)

☐ Yes
☐ No

  1. Project has entered into a "binding and enforceable agreement" to comply with all ELDP certification criteria as conditions of approval, which may be enforced by the lead agency (PRC § 42649.8)

☐ Yes
☐ No

Application
to Governor
and Governor's Certification
for ELDP Status

Enrollment in the ELDP program is voluntary, and requires applicants to file an application for ELDP certification with the governor. (PRC § 21183)

  1. An application fee may be charged, as determined by the Governor's Office of Planning and Research, to cover the cost of processing an ELDP application (PRC § 21184.7)
  2. Applicant agrees to pay the costs of legal challenge to lead agency's action on a certified project (PRC § 21183 (f))
  3. Applicant agrees to pay the costs of preparing the record of proceedings (PRC § 21183 (g))
  4. Application content requirements are subject to discretionary decisions of the Governor's Office (e.g., copy of Project Labor Agreement – or not) (PRC § 21182)
  5. Governor's approval of application and certification is required for all ELDP types
  6. Governor's certification may be approved prior to certification of the Final Environmental Impact Report (EIR) (PRC § 21183)

 

ELDP Program
Expiration Date

(PRC § 21181)

Governor's certification of ELDP must be obtained prior to Jan. 1, 2024

 

Note: ELDP projects are required to comply with additional CEQA compliance procedures during the city or county entitlement review and approval process, and are subject to different court procedures during litigation challenges to approved projects. Further information about these procedural obligations are available from the authors on request.

 

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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