The Potential Impacts of SB 743: Did the Legislature Double Dribble?

Co-contributors: PlaceWorks, Tim Paone of Cox Castle & Nicholson, and Tony Petros of LSA Associates and a member of the Newport Beach City Council.

It went in as a bill to streamline approval of a basketball arena. It came out, in addition, as legislation that revolutionizes the way traffic impacts are evaluated under CEQA. SB 743 will change the focus of CEQA traffic impact analysis from avoiding or mitigating congestion to reducing greenhouse gas emissions and promoting multimodal transportation and infill development. It eliminates traditional “level of service” (LOS) analysis as the measure of traffic impacts and replaces it with “vehicle miles traveled” (VMT). The Governor’s Office of Planning and Research (OPR) was directed to prepare CEQA guidelines to implement this change. A “discussion draft” of proposed Guidelines was released in August. When and if approved, the Guidelines will take effect in “transit priority areas” immediately and then statewide in 2016.

Under the Guidelines, VMT measures “the amount and distance that a project might cause people to drive,” rather than congestion and delay. Changing the traffic methodology is intended to result in more sustainable communities. But will the Legislature’s direction be circumvented by local agencies whose residents (and voters) care more about how long it takes to get to work, school, and the grocery store than they do about global warming, sustainable living, and terms such as “multi-modal”? And what does SB 743 portend for California’s roadway infrastructure? Consider these facts:

  • Traditional CEQA analysis often leads to mitigation measures that increase roadway capacity to accommodate new vehicle trips. Under the Guidelines, however, an increase in roadway capacity becomes not a solution, but a significant impact.
  • The Guidelines address CEQA, but not general plans. Local governments may still use or maintain LOS requirements in their general plans. As a result, potential traffic impacts for proposed projects may end up being evaluated through two conflicting methodologies.
  • There are two contexts in which the general plan comes into play. First, under CEQA itself, an EIR must discuss inconsistencies between a proposed project and the agency’s general plan. Second, to approve a project, the agency must find it consistent with the general plan. So, there will be no escaping the LOS requirements of a general plan.

With these considerations in mind, several questions arise:

  • Will Compliance with a General Plan Create a Significant Impact under CEQA? Local government cares about local traffic congestion. Modifying a project to comply with the general plan could require a finding of significant impact in the EIR. A potential result of the likely conflicts between general plans and EIRs is the outright denial of an otherwise desirable project. A second possibility is modifying the project to comply with the general plan, followed by the finding of a significant traffic impact in the EIR, and then the adoption of a Statement of Overriding Considerations to allow project approval. To do so, however, requires both political will and additional CEQA findings justifying the override. Policies, strategies, and results will vary from agency to agency and project to project.
  • How Will Infrastructure Needs and Funding Be Determined? A compelling question is whether SB 743 is the Legislature’s first step toward limiting funding for local and regional roadway improvements that accommodate growth. LOS has traditionally played a central role in identifying needed circulation improvements, with the free flow of traffic being the core consideration. If the Legislature maintains the SB 743 policy direction, dramatic change may be near in the way California addresses transportation funding.
  • Will the New Guidelines Have Their Desired Effect? SB 743 emphasizes “the need to build infill housing and mixed use commercial developments within walking distance of mass transit facilities, downtowns, and town centers and to provide greater flexibility to local governments to balance these sometimes competing needs.” If these principles applied only to the traffic impacts of what SB 743 calls “transit priority areas,” the prerequisites to success might already be in place: readily available mass transit and a highly urbanized environment. Notably, the Guidelines support findings that a project in a transit oriented area is likely to have a less significant impact than the same project in an area not served by transit.

The Legislature focused on these “transit priority areas,” but left it to OPR to decide whether the Guidelines would apply to other areas of the state. As proposed by OPR, the Guidelines will apply statewide starting in 2016. As a result, local governments that may not be transit-ready for decades may struggle to accommodate growth that cannot be mitigated through roadway and intersection improvements paid for by development.

The proposed Guidelines are openly intended to change the course of land planning and development in California and how people move about in their daily lives. Will the Guidelines make that lofty goal a reality? Or will they stifle development, create congestion and delay, or both? Only time will tell.

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