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The California Supreme Court Issues Important New Rulings on Analysis of Greenhouse Gas Emissions, Fully Protected Species, and Requirements for California Environmental Quality Act Litigation

The California Supreme Court’s latest California Environmental Quality Act (CEQA) decision contains important rulings affecting three areas of land use and environmental law practice.  The decision, Center for Biological Diversity v. California Department of Fish and Wildlife (November 30, 2015, Case No. 217763), was a 5-1-1 decision, and it arose out of one of many environmental impact reports (EIRs) that have been prepared for the large Newhall Ranch development that is proposed in northern Los Angeles County.  This particular EIR followed earlier EIRs certified by Los Angeles County in 1999 and 2003 in connection with the County’s primary project approvals.  The new EIR was a joint EIR/EIS prepared by the California Department of Fish and Wildlife and the U.S. Army Corps of Engineers to evaluate the impacts of several additional project approvals, including a resource management plan, a conservation plan for the endangered spineflower plant, a streambed alteration agreement, and two permits for the incidental take of protected species.

Several of the rulings in the case are likely to make the CEQA process, and the analysis of greenhouse gas emissions in CEQA documents, more complicated.  The primary rulings in the case are discussed below.

EIR Analysis of greenhouse gas emissions upheld in part, rejected in part.  The Court upheld some aspects of the EIR’s lengthy analysis of greenhouse gas emissions, but found that the analysis was not thorough enough.  There are three components to this ruling.

“Business as Usual” Significance Methodology Upheld in General.  The EIR determined the significance of emissions related to the project by comparing those emissions to the reductions from “business as usual” that will be needed to reduce emissions to 1990 levels by 2020, as required by AB 32, the Global Warming Solutions Act.  This comparison to “business as usual” or “BAU” emissions is based on the 2008 Climate Change Scoping Plan released by the Air Resources Board.  Environmental groups argued that the BAU methodology constitutes a hypothetical baseline such that actual existing emissions are not compared to the likely emissions of a project.  The Court found that the BAU methodology was not used to describe the baseline existing conditions, but was instead properly used as a yardstick for determining the significance of future emissions associated with the project.  The Court also noted that, given the global scope of climate impacts, it makes sense to use an efficiency metric such as AB 32 consistency, rather than an absolute numerical standard, in determining the significance of emissions related to a project.

Application of the BAU methodology was not sufficient.  After upholding the EIR’s methodology, however, the Court held that the EIR did not substantiate the conclusion that cumulative impacts from the Newhall project would be less than significant.  The EIR reached this determination based on an anticipated 31 per cent reduction against business as usual, compared to a statewide target of a 29 per cent reduction from business as usual.  The Court held that “the EIR’s deficiency stems from taking a quantitative comparison method developed by the Scoping Plan as a measure of the greenhouse gas reduction effort required by the state as a whole, and attempting to use that method, without adjustments, for a purpose very different from its original design” – namely, measuring the impacts of a specific project in a specific location.  It is not clear from the decision how this adjustment of the state goal should be achieved in particular cases, and this aspect of the decision will require careful attention in the preparation of EIR analyses of greenhouse gas emissions.

Suggestions for Appropriate Use of the BAU Methodology.  The Court concluded its ruling with some suggestions for applying the BAU methodology.  First, lead agencies can use the comparison to BAU methodology if they also determine what reduction a particular project must achieve in order to comply with statewide goals.  Second, project design features that comply with regulations to reduce emissions may demonstrate that those components of emissions are less than significant (but the Court cautioned that energy-efficient buildings would not be a basis for finding that transportation emissions are less than significant).  Lead agencies could also demonstrate compliance with locally adopted climate plans, or could apply specific numerical thresholds developed by some local agencies.

Impacts to fully protected species.  The Court held that mitigation measures intended to protect species from the impacts of construction, including relocating the unarmored three-spine stickleback fish to creeks farther away from construction, constituted a prohibited “take” of the protected species.  This issue arose under provisions of the California Fish and Game Code governing “fully protected” species—Code provisions that have not been interpreted much by California courts.  For fully protected species, including the stickleback, the Code prohibits the species from being “taken or possessed” with limited exceptions, and those exceptions specifically exclude mitigation for the impacts of particular projects.  The stickleback is also listed as an endangered species, and CDFW and others argued that the no-take provisions that applied to the fish as a fully protected species should be harmonized with other code sections governing endangered species, including a provision that allows “live trapping and transplantation” of endangered species as a conservation measure.

Requirement to exhaust remedies before filing CEQA lawsuits.  CEQA generally requires that issues be presented to the lead agency during the approval process, as a prerequisite to litigating those issues.  The CEQA statute specifically requires issues to be raised either when an EIR is circulated for comments or before the close of the public hearing on the project.  CEQA, however, does not require any hearings to be held, and the issue in this case was how the statute is applied when there is no public hearing on the project after the EIR comment period.  Given that the document was a joint document under state and federal law, however, there was a later comment period under federal law, and CDFW worked with the Army Corps on responding to comments received during the later federal comment period.  The Court held that, in this particular case, CDFW treated the federal comment period as an optional second CEQA comment period, and that issues raised during that second comment period were sufficiently exhausted and preserved for litigation.

This last ruling has somewhat limited application, because most approvals for development projects require a public hearing; for example, hearings for local land use approvals are required by the Planning and Zoning Law.  In that situation, the statute allows issues to be raised either during the EIR comment period, or until the close of the required public hearing.  When a hearing is not required or held, however, as is often the case for approvals by state agencies, the comments must be raised during the comment period or periods on the CEQA document.

Five Justices signed onto the majority opinion.  Justice Corrigan dissented from portion of the ruling that requires more specific analysis when the BAU methodology is used.  Justice Chin dissented in full, stating that he would have upheld the EIR in all respects.

Note:  Michael Zischke, Andrew Sabey, Linda Klein and Jimmy Purvis of Cox Castle represented the California Building Industry Association, the Building Industry Legal Defense Foundation, the Building Industry Association of the Bay Area, the California Business Properties Association and the California Association of Realtors as amici curiae in this case.