Lay of the Land

Retail & Commercial Group 2020 Forecast

Published on: January 22, 2020 | By Cox Castle

As they have done for the past eleven years, the Retail and Commercial Development Group has, once again, taken on the daunting task of forecasting what to expect in the forthcoming year in four critical segments that affect the retail and office industries. In doing so, they analyzed the social, political and economic events of 2019, reviewed various economic data and projections and have come to certain opinions relating to the retail and office industries and where they are heading in 2020. Included here is the product of their thinking, in the form of four articles of interest addressing such topics as capital markets, retailing, retailing development and office leasing:

Retail and Commercial Group | 2020 Forecast, by Gary Glick, Scott Grossfeld, Daniel Villalpando, and Andrew Ouvrier

The California Environmental Quality Act: 2019 Court Decisions and Legislation

Published on: January 9, 2020 | By Michael Zischke

I. OVERVIEW OF CEQA DEVELOPMENTS IN 2019

A. The Supreme Court decision in August 2019 in Union of Medical Marijuana Patients held that all zoning changes are not automatically CEQA “projects;” they must still meet the statutory standard of an activity with direct impact or reasonably foreseeable indirect impact.

B. Together with the late 2018 decision on Sierra Club v. County of Fresno, on air quality analysis and EIR standard of review issues, the issuance of the Union of Medical Marijuana Patients decision cleared the backlog of CEQA cases at the Supreme Court.

C. Protecting Our Water & Environmental Resources v. Stanislaus County, regarding whether well permits are ministerial or discretionary, is still pending. In December 2019, the Supreme Court granted review in County of Butte v. Department of Water Resources, regarding whether the Federal Power Act preempts CEQA as it may apply to state hydropower licensing actions, so there are now two CEQA cases pending at the state’s highest court.

D. There were 15 decisions from the various Courts of Appeal, a lower pace in than in prior years (there were 17 decisions, but two were depublished). One of the key decisions was McCorkle Eastside Neighborhood Group that design review did not include discretion over environmental impact issues, so city had no discretion and CEQA not triggered.

E. The Legislature enacted a number of bills in 2019, mostly exemptions relating to the housing and homeless crises.

New Endangered Species Act Regulations on the Horizon

Published on: August 16, 2019 | By Scott Birkey and R. Clark Morrison

California Gnatcatcher

Since President Trump took office in 2016, change is the new norm when it comes to environmental law. Within a month of taking office, the President proposed a dramatic narrowing of federal wetland protections under the Clean Water Act, resulting in a regulation that is now being finalized. The Trump Administration also issued an opinion limiting the scope of the Migratory Bird Treaty Act, narrowed the requirements for environmental impact statements under the National Environmental Policy Act, and rejected principle elements of the Obama Administration’s climate plan as well as the Paris Climate Accord. Now, the Trump Administration has issued numerous revisions to the regulations used by the U.S. Fish and Wildlife Service and the National Marine Fisheries Service to implement the Endangered Species Act.

On August 12, 2019, the Administration issued final rules for three separate rulemaking efforts to change certain key elements of the regulations used to implement the ESA. In our view, and contrary to the media firestorm surrounding the new regulations, these changes don’t amount to a “gutting” of the ESA. In fact, these rules don’t change the Endangered Species Act at all. Rather, they modify regulations which implement the ESA and which were adopted under previous administrations. Regulations are subject to change from time to time and, quite often, change with the political winds. Inevitably, what for some will be seen as harsh changes, others will perceive as needed reform. From our perspective as practitioners, the new regulations clarify a few procedural ambiguities and streamline some clunky aspects of the ESA’s regulations that we have been dealing with for years.

The new regulations are quite detailed. But in summary, below are some of the highlights: Continue reading

Takings Claims: The U.S. Supreme Court Just Cleared the Path to Federal Court

Published on: June 21, 2019 | By Tim Paone

In a 5-4 ruling today, written by Chief Justice Roberts, the United States Supreme Court overturned a 1985 decision which had made claims for the taking of private property far more difficult to pursue in federal court. In many ways, today’s ruling in Rose Mary Knick v. Township of Scott, Pennsylvania, 588 U. S. ____ (2019), represents a significant “back to the future” moment that should benefit landowners. Continue reading

California Adopts Far-Reaching Wetlands Permit Requirements

Published on: April 3, 2019 | By R. Clark Morrison and Scott Birkey

Yesterday, the State Water Board adopted stringent new permit requirements for development projects in California that may impact wetlands or other surface waters. These new requirements have been in the works for a decade, but the Trump administration’s proposed rollback of federal wetland laws provided the impetus for adoption this year.

Cox Castle was heavily involved in the final negotiations over these regulations on behalf of the building and agricultural sectors. Although the program remains burdensome, those negotiations resulted in significant concessions that will reduce its impact on housing and farming.

The new requirements (the “Procedures”) will be implemented through existing state permitting structures. Most often they will be applied through regional water board sign-off (or “certification”) of Corps of Engineers wetland permits. They will also be applied where the federal government has no jurisdiction. Continue reading

The Unintended California Consequences of Trump’s Wetland Protection Rollback

Published on: December 26, 2018 | By Scott Birkey and R. Clark Morrison

There are no surprises in the President’s proposal to vastly narrow the definition of wetlands and other waters protected by the federal Clean Water Act. Within a month of taking office in 2017, the President issued an executive order directing EPA and the Corps of Engineers to begin that process.

Nor are there any surprises in the new definition itself. As expected, EPA and the Corps of Engineers propose to replace the Obama-era definition – which was based upon the Supreme Court’s Rapanos decision – with a much narrower definition proposed by late Justice Antonin Scalia.

Under the new rule, the Clean Water Act’s protections will extend only to truly navigable rivers and their tributaries, as well as wetlands abutting those rivers or having a direct hydrologic connection. The Clean Water Act will no longer protect millions of acres of wetlands found in different habitat types around the Country, including most of the vernal pools and other seasonal wetlands found throughout California’s rangelands and foothills.

Trump Administration Regulatory Reforms Federal Natural Resource Law

Published on: August 22, 2018 | By R. Clark Morrison, Scott Birkey and Anne E. Mudge

A. National Environmental Policy Act (NEPA).

Presidential Executive Order 13807 (Establishing Discipline and Accountability in the Environmental Review and Permitting Process for Infrastructure Projects) (August 15, 2017):

Applies to any project that requires approval by multiple federal agencies, requires an EIS, and has a “reasonable availability” of funding. Requires NEPA reviews to be limited to 2 years, publication of all federal decisions in a single ROD (“One Federal Agency”) and federal authorizations to be issued within 90 days of ROD.

Interior Secretary Order 3355 (Streamlining National Environmental Policy Act Reviews and Implementation of Executive Order 13807) (August 31, 2017).

Limits environmental impact statements to 150 – 300 pages (the latter for unusually complex projects), excluding appendices, for all EIS documents prepared by DOI. Final environmental impact statements required to be completed within one year from issuance of NOI unless Asst. Sect’y approves 3-month extension. Continue reading

Will California Ever Adopt Real Housing Reform?

Published on: March 27, 2018 | By Andrew Sabey

Californians could be forgiven for becoming cynical about our State Legislature’s willingness or ability to tackle the ever-worsening housing crisis. California’s rising home values, outpacing people’s ability to afford to buy or rent decent housing close to the job centers, is not a new phenomenon. But it has worsened. While our Legislature has repeatedly recognized that there is a housing crisis, nothing in the past legislative cycles has emerged that will actually stem the tide.

Could that be changing? In the current session, there are two bills sponsored by state senator Scott Wiener that are worth watching: SB 827 and SB 828. These two bills follow on Senator Wiener’s successful introduction of SB 35 last year. While SB 35 was intended to make certain types of urban infill housing “by-right,” Senator Wiener himself has recognized that SB 35 alone (with all of its qualifications and conditions) may not yield much in the way of new housing.

New Rules for Old Buildings

Published on: February 23, 2018 | By Linda Klein

Restored historic and old buildings, particularly in cities like San Francisco, contribute to the distinctive character that lure tourists and thereby creates jobs. Two relatively recent changes affect those buildings and the potential for their continued revitalization. First, changes to the Historic Tax Credit may alter the capital stack used to finance the rehabilitation of historic projects, as well as the overall return on investment for such projects. Second, changes to the Standards for the Treatment of Historic Properties with Guidelines for Preserving, Rehabilitating, Restoring and Reconstructing Historic Buildings may alter how historic resources are treated and the mitigation measures required under the California Environmental Quality Act.

Inside CA Legislature’s Housing Package: HCD Releases SB 35 Eligibility Determination for Project Streamlining

Published on: February 20, 2018 | By Christian H. Cebrian, Margo Bradish and Ashley Weinstein-Carnes

On February 1, 2018, the California Department of Housing and Community Development (“HCD”) released its much anticipated determination regarding the local governments that are now subject to streamlined entitlements for housing development under Senate Bill 35. HCD’s methodology for this determination utilizes pro-rated Regional Housing Needs Allocation (“RHNA”) targets for the local governments that have not yet reached the statutory reporting period. Overall, the HCD release underscores the scope and scale of the housing shortage in California, and the opportunity for housing developers to benefit from a ministerial approval process for qualified housing projects.