In an important and highly anticipated decision under the California Environmental Quality Act (CEQA), the California Supreme Court overturned a Court of Appeal’s decision that would have severely limited public agencies’ ability to rely on commonly used “categorical exemptions” from CEQA’s environmental review mandates. The Court’s opinion in Berkeley Hillside Preservation v. City of Berkeley introduces a new test for determining the applicability of the “unusual circumstances” exception to categorical exemptions, potentially complicating agencies’ process for evaluating applicable exemptions and may create new avenues for project opponents to attack their use.

BACKGROUND -

In 2010, a group of residents sued the City of Berkeley, challenging its approval of a large home in the Berkeley hills—nearly 10,000 square feet, including a 10-car garage. The City had concluded that the project did not require an Environmental Impact Report (EIR) or another form of CEQA environmental review because it qualified under two independent categorical exemptions found in the CEQA Guidelines—an exemption for “In-Fill Development Projects” (Guidelines § 15332) and another for the “New Construction or Conversion of Small Structures,” single-family residences (Guidelines § 15303(a)). The City found that the project did not trigger any exceptions to the exemptions, specifically finding that the project did not present any “unusual circumstances” that would result in significant effects on the environment (Guidelines § 15300.2(c)).