12 Addendum - Highway BPOC ADDENDUM
PREPARED BY: Ying Smith
Transportation and Mobility Manager
Reviewed by: Town Manager, Assistant Town Manager, Town Attorney, Finance Director, and Parks and
Public Works Director
110 E. Main Street Los Gatos, CA 95030 ● (408) 354-6832
www.losgatosca.gov
TOWN OF LOS GATOS
COUNCIL AGENDA REPORT
MEETING DATE: 12/01/2020
ITEM NO: 12
DATE: November 30, 2020
TO: Mayor and Town Council
FROM: Laurel Prevetti, Town Manager
SUBJECT: Highway 17 Bicycle and Pedestrian Overcrossing (Project 818-0803):
a. Authorize the Town Manager to Negotiate and Execute a Measure B
Funding Agreement with the Santa Clara Valley Transportation Authority
(Attachment 1) to Accept a Measure B Grant in the Amount of $2,754,990
for the Highway 17 Bicycle and Pedestrian Overcrossing Project Final
Design Phase;
b. Authorize Revenue and Expenditure Budget Increases in the Total
Amount of $3,701,200 ($2,754,990 in Grant Fund and $946,210 in
General Fund Appropriated Reserve) in the Fiscal Year 2020/21 –
2024/25 Capital Improvement Program (CIP) Budget for the Highway 17
Bicycle and Pedestrian Overcrossing Project to Recognize the Receipt of
Grant Funds in FY 2020/21;
c. Authorize the Release of a Request for Proposals (Attachment 2) for the
Highway 17 Bicycle and Pedestrian Overcrossing Design Project;
d. Authorize the Town Manager to Negotiate and Execute a Consultant
Agreement with the Highest Ranked Firm in an Amount Not to
Exceed $3,000,000; and
e. Approve the Highway 17 Bicycle and Pedestrian Overcrossing Community
Engagement Plan (Attachment 3).
REMARKS:
This addendum reflects public comment received from 11:01 a.m., Wednesday, November 25,
2020 through 11:00 a.m., Monday, November 30, 2020.
PAGE 2 OF 2
SUBJECT: Highway 17 Bicycle and Pedestrian Overcrossing (Project 818-0803)
DATE: November 25, 2020
Attachments Previously Received with Staff Report:
1. Draft Measure B Funding Agreement with the Santa Clara Valley Transportation Authority.
2. Draft Request for Proposals for Professional Engineering Design Services.
3. Draft Highway 17 Bicycle and Pedestrian Overcrossing Community Engagement Plan.
4. Highway 17 Bicycle and Pedestrian Overcrossing Project Background.
5. Public Comment Received.
Attachment Received with this Addendum:
6. Public Comment Received from 11:01 a.m., Wednesday, November 25, 2020 through 11:00
a.m., Monday, November 30, 2020.
John A. Smart
Attorney at Law
6469 Almaden Expy Ste 80 #369
San Jose, California 95120
Phone (408) 395-7016 EXT. 88
Fax (469) 393-4444
legal@fastmail.us
Admitted to Practice in California and Texas
November 27, 2020
Los Gatos Town Council
c/o Town Manager
110 E. Main St.
Los Gatos, CA 95030 Via E-Mail (manager@losgatosca.gov)
Re: CEQA ENVIRONMENTAL REVIEW
Highway 17 Bicycle and Pedestrian Over-crossing (Project 818-0803)
Objection to Agenda Item #12 (December 1, 2020 Town Council Meeting)
Dear Town Council Members:
I am writing on behalf of Los Gatos Citizens for Responsible Town Government, which is an
unincorporated association of residents, citizens, homeowners, workers, taxpayers, and electors
residing in the Town of Los Gatos. Its organizational purpose includes advocating for equitable and
responsible land use development policies, maintaining political accountability of elected local
officials, and enforcing land use planning and environmental laws in and around Los Gatos.
Members, which include adult U.S. citizens and residents of Los Gatos, maintain a direct and
regular geographic nexus with the Town of Los Gatos, and will suffer direct harm as a result of any
adverse environmental and/or public health impacts caused by poorly planned or managed public
projects. They have a clear and present right to, and beneficial interest in, the Town's performance
of its duties, including complying with all applicable state and federal environmental, land use, and
health laws and regulations. The association seeks to protect the interests of its Members and will
enforce the public duties owed to them by the Town, if necessary.
The circumstances underlying this letter are rather remarkable. This Project had three
original sites under consideration, with each site having multiple design alternatives available. In
fact, Town Staff's currently-selected site, Blossom Hill Road, is known to have at least four
different design alternatives available, bringing the total number of alternatives already known to be
available for the Project to more than half a dozen. Remarkably, not only are the Members
represented herein strong proponents of the Project generally, but they are in fact proponents of
locating the Project at Blossom Hill Road, assuming a proper design is selected. Yet, disagreement
arises here due to Staff's unyielding insistence on institutionally and now potentially financially
locking-in upfront a very specific final design (i.e., very large (16-20' wide) separately-
constructed/ancillary bike/pedestrian bridge, Southbound-aligned to existing Blossom Hill Road
bridge) before any evaluation or consideration whatsoever of corresponding environmental and
cumulative impacts, even though Staff's choice is already known to pose burdensome environmental
impacts both for nearby residents and the community, and also known to pose substantial
cumulative impacts from two successive large-scale bridge construction projects. This letter brings
certain environmental laws to the Town Council's attention so that the Town understands the
environmental review that is required before the Town commits as a practical matter to a definite
course of action for the Project.
Town Project 818-0803
Environmental Laws & Regulations
Page 2
The California Environmental Quality Act (CEQA)
The California Environmental Quality Act (CEQA - Pub. Res. Code §§21000 et seq.),
enacted in 1970, forms the basis of environmental law and policy in the State of California. CEQA
is modeled after the National Environmental Policy Act (NEPA) and protects all aspects of the
environment. Here, the focus is on maintaining a quality environment for the people of California,
an environment that is healthful and pleasing to the senses, including preserving clear air and water,
preserving the enjoyment of the aesthetic, natural, and scenic beauty that the state offers, and
providing freedom from excess noise. Like the federal act, CEQA requires public agency decision
makers to document and consider the environmental implications of their actions. However, CEQA
requires more. "CEQA contains substantive provisions with which agencies must comply. The most
important of these is the provision requiring public agencies to deny approval of a project with
significant adverse effects when feasible alternatives or feasible mitigation measures can
substantially lessen such effects." Sierra Club v. Gilroy City Council (6th Dist. 1990) 222 Cal. App.
3d 30, 41. "A project may not be approved as proposed if feasible alternatives or mitigation
measures would substantially lessen the project's significant environmental effect." Citizens for
Quality Growth v. City of Mount Shasta (3d Dist. 1988) 198 Cal. App. 3d 433, 440-441.
In practice, CEQA requires public agencies to prepare environmental impact assessments of
a proposed project and to circulate those documents to the public and other agencies for comment
before approving that project. Agencies are required to avoid or mitigate environmental impacts
whenever feasible. (Pub. Res. Code §21002; CEQA Guidelines §§15002, 15021). If avoiding or
minimizing environmental damage is truly infeasible, CEQA requires agencies either to disapprove
the proposed project or prepare a CEQA-compliant written justification of "overriding
considerations" - supported by substantial evidence in the record - that explains why a given project
still must be approved. (Pub. Res. Code §21081; Guidelines §15091). Even in the case where a
public agency might not have the jurisdictional authority to effect a given mitigation, CEQA
nevertheless requires the agency to disclose all such mitigations and to identify the other agencies
that would have the power to implement the mitigations.
Public projects draw additional scrutiny under CEQA, as the public agency essentially
prepares and approves the environmental review for its own projects. The later the environmental
review process begins, the more bureaucratic and financial momentum there is behind a proposed
project, thus providing a strong incentive to ignore environmental concerns that could be dealt with
more easily at an early stage of the project. Guidelines §15004 addresses this issue by detailing
proper timing requirements for commencing environmental review for public projects, stating that
"project sponsors shall incorporate environmental considerations into project conceptualization,
design, and planning" at the earliest feasible time. "[P]ublic agencies shall not undertake actions
concerning the proposed public project that would have a significant adverse effect or limit the
choice of alternatives or mitigation measures, before completion of CEQA compliance." This
includes an explicit prohibition against taking "any action which gives impetus to a planned or
foreseeable project in a manner that forecloses alternatives or mitigation measures that would
ordinarily be part of CEQA review of that public project." (CEQA Guidelines, § 15004, subd.
(b)(2)) As no separate state agency is explicitly authorized to enforce CEQA, enforcement has
primarily been accomplished through the courts via private attorney general actions brought by
Town Project 818-0803
Environmental Laws & Regulations
Page 3
environmental and citizen groups against agencies attempting to shortcut CEQA compliance.
As you are aware, on September 1, the Town Council approved Agenda Item #10 which
formally endorsed Staff's Preferred Alternative (Blossom Hill Road Separate bridge, Southbound
alignment) as well as approved a Feasibility Study. The September 1 action also authorized
submission of a Caltrans Active Transportation Program (ATP) grant application by its September
15 application deadline, and committed up to $1 million as matching funds for the grant. (The ATP
grant application effort was abandoned by Staff.) Town records show approximately $250k was
spent on the Feasibility Study, which reflects less than 1% of the Project's currently-estimated $28
million price tag. Staff's indication of a Preferred Alternative is, by itself, helpful to inform Town
residents what the Town's preference is. The preference should merely be an objectively-prepared
choice at this point however. Staff's choice certainly should not be approved, adopted, and funded
as effectively Town's Final Adopted Project Choice before CEQA evaluation occurs to determine
whether the choice is even advisable when compared to all the other reasonable and feasible
alternatives. Instead, all reasonable alternatives (including a "no project" alternative) should be
rigorously explored and objectively evaluated before a final choice is in fact made.
The present Agenda Item before the Town Council requests approval to obtain and commit
$2.8 million grant funds (from VTA Measure B) for "Final Design Phase," which when combined
with matching funds ($950k) would consume at least 13% of the Project's budget. When those
amounts are combined with a $3 million consulting agreement (Item #12. d), the Agenda Item
potentially commits upwards of 24% of the Project's budget. Any Town Council approval of Staff's
request should require Staff to comply with CEQA review procedures before the Town makes any
significant financial commitment to a specific design or course of action for the Project, particularly
spending millions of dollars in the pursuit of a Final Design of Staff's Preferred Alternative. Any
premature commitment of substantial funds in the pursuit of the Final Design of Staff's Preferred
Alternative at this juncture would serve as an economic yoke or constraint effectively limiting the
Town's power in the future to consider the full range of alternatives and mitigation measures
required by CEQA.
Under Guidelines §15004, CEQA documents should be prepared early enough in the
planning process to enable environmental factors to influence project design, but late enough so that
useful information is available for environmental assessment. Lead agencies should prepare CEQA
documents during the agency planning process, and must complete and certify those documents
before project "approval," which is the decision committing an agency to a definite course of action
on the project (Guidelines §15352(a)). For the Project 818-0803, Staff has already generated highly
detailed location, alignment, and engineering plans and specifications for the Project that are
sufficiently well-defined and specific to allow meaningful rather than merely speculative review of
potential impacts, and analysis of all reasonably feasible alternatives and mitigation measures
available to the Project. Now, Staff requests that the Town Council approve the commitment of
substantial funds to the Project, yet there is no indication that a complete environmental review
would occur before Staff simply steers substantial funds to their Preferred Alternative. Such
commitment of funding to a project (and in this case a particular final design of a proposed project),
or otherwise taking any action that gives impetus to a planned-for foreseeable project in a manner
that forecloses alternatives or mitigation measures that would ordinarily be part of CEQA
Town Project 818-0803
Environmental Laws & Regulations
Page 4
compliance, is the type of action Guidelines §15004 aims to prevent.
As seen in the California Supreme Court's Save Tara v. City of West Hollywood (2008) 45
Cal. 4th 116) decision, how strongly a lead agency commits to a proposed project may determine
how early in the process CEQA compliance should occur. Staff has already advised residents who
oppose Staff's Preferred Alternative that, while residents' input on minor bridge stylistic features
might be considered, Staff has ruled out other known candidate sites as well as other alignment and
design alternatives within the final Blossom Hill Road site, thus limiting residents' input to minor
end-of-project details. All of the potential environmental impacts posed by Staff's Preferred
Alternative choice and previously highlighted by the residents are left completely unaddressed, as if
they had never been raised. Although an agency may telegraph its preferences by designating a non-
committal "preferred alternative" before CEQA review, any substantive commitment beyond that
point must be preceded by CEQA completion and compliance. Otherwise, future CEQA analysis
would be tainted as the agency's pre-commitment of the Project to a certain alternative and course
of action yields a defective or sham CEQA analysis, one that has improperly precluded the
feasibility of other alternatives and mitigation measures before any environmental analysis has
occurred. Approval of Staff's proposal (as written) risks the Town commencing the Project and an
already-prescribed Final Design for the Project before completing CEQA review. Approval of
Staff's request would be a major step in the Project's progress, and one that is very likely to be
irreversible. The Town Council should ensure that Staff cannot now simply steer millions of dollars
towards their Preferred Alternative, thereby erecting an economic barrier limiting the choice of
other alternatives or mitigation measures, all before completing CEQA review. Staff's Preferred
Alternative must remain a non-committal choice financially, along with all the other feasible
alternatives, until such time that the Town's best alternative is determined under CEQA review.
CONCLUSION
I urge the Town Council to reject or modify the proposed action as written as it does not
include adequate safeguards ensuring that environmental review of the proposed Project will occur
before Staff commits the Town to a definite course of action for the Project and does so in a manner
that constitutes a discretionary project "approval" under CEQA. The Town Council may accept,
reject, or modify any Staff proposal on the Agenda. Thus, if you decide to approve Staff's proposed
action, I urge the Town Council to condition such approval on requisite environmental review of the
proposed Project before the Town commits to the Project as a practical matter, so that the Project's
environmental impacts may be uncovered and properly addressed. This would, for example,
preclude Staff from spending millions of dollars on Final Design of Staff's Preferred Alternative
before environmental review has occurred. If you permit the proposed action to proceed, the rest of
the development contemplated by the Project will inevitably follow as a result. The Town has not
done an environmental analysis that reviews the impacts that can be expected if you make a
decision to allow the Project to proceed. Such an analysis is absolutely required, not only to comply
with environmental laws, but also to put the Town Council in a position to truly understand the
implications of the decisions you are contemplating. Please insist on such a full environmental
analysis before committing the Town to the Project.
Town Project 818-0803
Environmental Laws & Regulations
Page 5
Thank you for your attention and careful consideration of the mater.
Respectfully submitted,
John A. Smart
Encls. Save Tara v. City of W. Hollywood
1
Filed 10/30/08
IN THE SUPREME COURT OF CALIFORNIA
SAVE TARA, )
)
Plaintiff and Appellant, )
) S151402
v. )
) Ct.App. 2/8 B185656
CITY OF WEST HOLLYWOOD, )
)
Defendant and Respondent; ) Los Angeles County
) Super. Ct. No. BS090402
WASET, INC., et al., )
)
Real Parties in Interest and )
Respondents. )
___________________________________ )
Under the California Environmental Quality Act (CEQA) (Pub. Resources
Code, § 21000 et seq.),1 a public agency must prepare an environmental impact
report (EIR) on any project the agency proposes to “carry out or approve” if that
project may have significant environmental effects (§§ 21100, subd. (a), 21151,
subd. (a)). We address in this case the question whether and under what
circumstances an agency’s agreement allowing private development, conditioned
on future compliance with CEQA, constitutes approval of the project within the
meaning of sections 21100 and 21151. We conclude that under some
1 All further unspecified statutory references are to the Public Resources
Code.
2
circumstances such an agreement does amount to approval and must be preceded
by preparation of an EIR. Under the circumstances of this case, we further
conclude the City of West Hollywood’s conditional agreement to sell land for
private development, coupled with financial support, public statements, and other
actions by its officials committing the city to the development, was, for CEQA
purposes, an approval of the project that was required under sections 21100 and
21151 to have been preceded by preparation of an EIR.
FACTUAL AND PROCEDURAL BACKGROUND
The property at 1343 North Laurel Avenue (1343 Laurel) in the City of
West Hollywood (City) is occupied by a large colonial-revival-style house
constructed in 1923, later converted to four apartments, and a chauffeur’s house
and garage. The buildings are set well back from the street and the property is
heavily wooded and landscaped, in contrast to most other properties on the block.
City designated the main house a local cultural resource in 1994. In 1997, Mrs.
Elsie Weisman, the longtime owner of 1343 Laurel, donated it to City on
condition she be permitted to live there until her death and the other tenants be
permitted to occupy the premises for six months after her death. Mrs. Weisman
died in 2000 at the age of 101.2
Two nonprofit community housing developers, West Hollywood
Community Housing Corporation and WASET, Inc., and a corporation they
created for the purpose, Laurel Place West Hollywood, Inc. (collectively, Laurel
Place), propose to develop approximately 35 housing units for low-income seniors
on the 1343 Laurel site. As outlined in a 2003 grant application to the United
2 Whether because of its estate-like appearance or because Gone With the
Wind was Mrs. Weisman’s favorite film, 1343 Laurel has acquired the popular
nickname “Tara.”
3
States Department of Housing and Urban Development (HUD), the project would
preserve the main house but not the chauffeur’s house or garage. The existing
two-story house would be converted to hold the manager’s apartment, one
resident’s apartment, and communal space, including a multipurpose room, arts
and crafts room, television lounge and kitchen. A new three-story building,
wrapping around the existing house’s back and sides, would contain 33 one-
bedroom apartments and underground parking spaces for residents. Between the
back of the existing house and the new building would be a landscaped courtyard.
A 2,800-square-foot portion of the existing front yard would remain in City’s
hands and be used as a pocket park. The HUD application included preliminary
architectural drawings showing the proposed renovation, new building, site plan
and landscaping.
On June 9, 2003, to facilitate Laurel Place’s HUD grant application, City’s
city council granted Laurel Place an option to purchase the 1343 Laurel property,
allowing the developer to show HUD it had control of the project site. In a
June 10 letter to a HUD official, City’s city manager outlined City’s intended
contribution to the proposed project: “To make the project competitive, [City] has
approved the sale of the property at negligible cost.” More specifically, City
planned to contribute $1.5 million in land value. “In addition, [City] will commit
additional funding, in an amount not to exceed $1 million,” toward development
costs. “In summary, [City] will be contributing land and funds totaling $2,500,000
toward the development of the Laurel Place project.”
HUD approved a $4.2 million grant to Laurel Place in late 2003. City’s
mayor announced the grant in a December 2003 e-mail to residents, explaining it
“will be used to build 35 affordable senior residential units, rehabilitate an historic
house, and provide a public pocket park on Laurel Avenue.” He described the
project as “a win-win-win for the City, balancing desperately needed affordable
4
senior housing with historic preservation and open space.” Similarly, a City
newsletter announced that with the recent HUD grant, City and Laurel Place “will
redevelop the property” to rehabilitate the main house, build 35 units of low-
income senior housing, and create a pocket park. The mayor’s announcement
referred residents with questions about the proposed development to Jeffrey
Skornick, City’s housing manager.
Shortly after the HUD grant was approved, in November 2003, Skornick
wrote to a 1343 Laurel tenant, Allegra Allison, reassuring her that “nothing is
going to happen for about a year” and that “[a]s the project proceeds and prior to
construction” the tenants would receive professional relocation assistance. While
he knew she would prefer to stay at 1343 Laurel, the housing manager wrote, he
pledged, on City’s behalf, to “do everything in our power to minimize the impact
of this project on you.” In December 2003, Allison responded that “your
relocation people” had already contacted tenants and, according to one tenant, had
said they would soon be served with “one year eviction notices.”
In January 2004, Skornick, responding to a resident critical of the proposed
development, explained that the project would retain the historic house and most
of the property’s front yard, as the new building would be to the rear of the site.
He continued: “We are happy to consider variations on the approach. However,
inasmuch as the City and its development partners have been awarded a $4.2
million federal grant to help develop this project for senior housing, we must
continue on a path that fulfills this obligation.” In another January 2004 e-mail to
a resident, a city council member’s deputy used the same language, referring to the
development of senior housing on the site as an “obligation” City “must” pursue.
On April 23, 2004, City announced the city council would consider, at its
May 3 meeting, an agreement to facilitate development of the 1343 Laurel project,
“subject to environmental review” and other regulatory approvals. Save Tara, an
5
organization of City residents and neighbors opposed to the project, wrote City to
urge that it conduct CEQA review, including an EIR, before approving any new
agreement, making a loan, or renewing the purchase option. Despite that and
numerous other objections voiced at the meeting (many also expressed support),
the city council on May 3, 2004, voted to (1) approve a “Conditional Agreement
for Conveyance and Development of Property” between City and Laurel Place,
including a $1 million City loan to the developer, in order to “facilitate
development of the project and begin[] the process of working with tenants to
explore relocation options”; (2) authorize the city manager to execute the
agreement “substantially in the form attached”; and (3) have appropriate City
commissions review “alternative configurations” for the planned new building and
obtain more public input “on the design of project elements.”
The “Conditional Agreement for Conveyance and Development of
Property” the city council thus approved and authorized the city manager to
execute (the May 3 draft agreement) had the stated purpose of “caus[ing] the reuse
and redevelopment of [1343 Laurel] with affordable housing for seniors and a
neighborhood pocket park, while retaining the historic integrity of the Site.” The
agreement provided that “upon satisfaction of the conditions of this Agreement,”
City would convey the property to Laurel Place and provide the developer a loan,
and Laurel Place would construct 35 units of housing, one for the resident
manager and 34 restricted to occupancy by low-income seniors. In the first phase
of actions under the agreement, Laurel Place would obtain final HUD approval,
“complete the relocation of tenants”3 and take actions necessary “to comply with
3 A staff report on the proposed agreement, presented to the city council,
explained that relocation notices would be sent “shortly after” the agreement was
executed, starting a one-year period for relocating the tenants.
6
CEQA . . . .” Once the property was conveyed, the second, construction phase
would begin.
Under the May 3 draft agreement, City’s obligation to convey the property
and make the improvement portion of the loan (i.e., all of the $1 million loan other
than the predevelopment portion and an earlier grant for $20,000) was subject to
several conditions precedent, among them that “[a]ll applicable requirements of
CEQA . . . have been satisfied, as reasonably determined by the City Manager”
and that “[d]eveloper shall have obtained all Entitlements.”4 The city manager,
however, could waive these conditions. The predevelopment portion of the loan,
which City estimated at $475,000, was to be used for, inter alia, “environmental
reports” and “governmental permits and fees” and was not subject to the CEQA
compliance or entitlement conditions.
A “Scope of Development” discussion attached to the May 3 draft
agreement explained that “[a] three- or four-story building over semi-subterranean
parking will be erected at the west-rear portion of the lot, replacing what are
currently the garage and outdoor parking area, and possibly the chauffeur’s
quarters.” The new building’s exterior and interior design were described in some
detail.
At the city council’s May 3, 2004, meeting, the project architect explained
that the exact building design had not yet been determined and that historic
preservation values would be fully considered in the final design. For example,
the chauffeur’s house could be preserved, while still adding 35 housing units, by
4 The May 3 draft agreement defined “Entitlements” to include zoning
changes, general plan amendments, and CEQA compliance, as well as any other
permit or license required by City.
7
making the new building four stories rather than three, though the architect for
aesthetic reasons preferred a three-story building.
Skornick, City’s housing manager, similarly told the council that the further
planning processes the project would undergo were “not a rubber stamp,” as there
were “real options to consider” regarding the design of the new building and park.
At the same time, Skornick noted that staff had already rejected the alternative
uses of 1343 Laurel suggested in public comments, such as dedication of the entire
property for a park or use of the historic home as a library or cultural center.
These alternatives, Skornick explained, failed to contribute to City’s affordable
housing goals and, in any event, “there were no funds available for those options.”
Finally, Skornick stressed that “while the agreement is conditional, the council
needs to know that the recommended actions will commit the city as long as the
developer delivers.”
On July 12, 2004, Save Tara filed the operative complaint and petition for
writ of mandate alleging, inter alia, that City had violated CEQA by failing to
prepare an EIR before the city council’s May 3 approval of the loan and draft
agreement. On August 9, 2004, City and Laurel Place executed a revised
agreement (the August 9 executed agreement).5 This agreement followed the
May 3 draft agreement in many respects, but contained some potentially
5 Save Tara argues the administrative record should not have been
augmented with the August 9 executed agreement, as its execution took place after
the decision Save Tara has challenged, i.e., the city council’s approval of the
May 3 draft agreement. We agree with the Court of Appeal, however, that
“[w]hile the May 2004 agreement is relevant for certain purposes, review of City’s
decision would be ineffective, if it were limited to the May 2004 Agreement,
which is no longer operative.” Like the lower court, we treat Save Tara’s petition
for writ of mandate as amended to address the August 9 executed agreement as
well as the May 3 draft agreement.
8
significant changes. The requirement that all applicable CEQA requirements be
satisfied could no longer be waived by the city manager, and the parties expressly
recognized City retained “complete discretion over . . . any actions necessary to
comply with CEQA” and that the agreement “imposes no duty on City to approve
. . . any documents prepared pursuant to CEQA.” Finally, details on tenant
relocation were stated, including that the developer was to begin the process by
hiring a relocation consultant within 30 days.
The superior court denied Save Tara’s mandate petition, finding that while
the parties agreed the 1343 Laurel project did call for an EIR at some time, none
was required before approving the May 3 draft agreement because “the Agreement
is expressly conditioned on compliance with CEQA . . . [and] does not limit the
project alternatives or possible mitigation measures.” Thus, City “has not given its
final approval to convey the property at issue to [Laurel Place], nor has it given its
final approval of the housing project itself.”
The Court of Appeal reversed. Section 21100, the appellate court reasoned,
requires an EIR be prepared whenever lead agencies “propose to approve or carry
out” a project with potential significant effects; it is not, contrary to the trial
court’s holding, “to be delayed until a ‘final’ decision has been made.” Moreover,
conditioning a development agreement on CEQA compliance is insufficient
because the EIR review process “is intended to be part of the decisionmaking
process itself, and not an examination, after the decision has been made, of the
possible environmental consequences of the decision.” Any question as to
whether a particular point in the development process is too early for preparation
of an EIR “is resolved by the pragmatic inquiry whether there is enough
information about the project to permit a meaningful environmental assessment. If
the answer is yes, the EIR review process must be initiated.” Before May 3, 2004,
the Court of Appeal held, the project was well enough defined to permit
9
meaningful environmental analysis, which City should have performed between
the award of the HUD grant in November 2003 and the approval of the May 3
draft agreement.
As remedy for the CEQA violation, the Court of Appeal remanded with
directions that City be ordered (1) to void its approval of the May 3 and August 9
agreements, and (2) to “engage in the EIR review process (a) based on the project
as described in the HUD application and (b) without reference to the May and
August 2004 Agreements.” One justice dissented, arguing the matter was moot
because, according to the parties, City had certified a final EIR for the project in
October 2006.
We granted City’s and Laurel Place’s petitions for review, which presented
the mootness issue as well as the substantive question of whether an EIR was
required before City’s approval of the conditional development agreement.
DISCUSSION
I. Mootness
According to the Court of Appeal decision, City approved a final EIR for
the 1343 Laurel project in October 2006, during pendency of the appeal. All
parties agree on this chronology and further agree that Save Tara has not
challenged the adequacy of this EIR in court.
The parties dispute whether these events rendered the present appeal moot.
City and Laurel Place take the position that Save Tara has already received the
relief it seeks in this action — preparation and certification of an EIR — and no
further effective relief can be granted it. They cite CEQA cases in which, during
pendency of the litigation, the project site had undergone irreversible physical or
legal changes. (See, e.g., Environmental Coalition of Orange County, Inc. v.
Local Agency Formation Com. (1980) 110 Cal.App.3d 164, 171-173 [challenge to
10
EIR for annexation moot where annexation had already occurred and could not be
ordered annulled because annexing city was not a party to the action]; Hixon v.
County of Los Angeles (1974) 38 Cal.App.3d 370, 378 [street improvement project
involving tree replacement had already progressed to removal of original trees,
which could not be restored].) Save Tara, in turn, argues that effective relief, in
the form of an order setting aside City’s approval of the May 3 draft agreement
and August 9 executed agreement, can still be awarded, as it was by the Court of
Appeal. It cites CEQA cases that were held not to be moot despite some
intervening progress on the project. (See, e.g., Bakersfield Citizens for Local
Control v. City of Bakersfield (2004) 124 Cal.App.4th 1184, 1202-1204 [partial
construction of a project did not moot the appeal, as the project could still be
modified, reduced, or mitigated]; Woodward Park Homeowners Assn. v. Garreks,
Inc. (2000) 77 Cal.App.4th 880, 888 [already constructed project could be
modified or removed].)
We agree with Save Tara that the preparation and certification of an EIR
does not render the appeal moot. No irreversible physical or legal change has
occurred during pendency of the action, and Save Tara can still be awarded the
relief it seeks, an order that City set aside its approvals. As will appear, we
ultimately conclude the matter must be remanded with directions that the superior
court order City to void its approval of the May 3 and August 9 agreements and
reconsider those decisions, informed this time by an EIR of the full environmental
consequences. Neither City nor Laurel Place contends such reconsideration is
impossible as a practical matter or that the superior court lacks the power to order
it. Such an order remedies the CEQA violation Save Tara alleges occurred,
approval of the agreements without prior preparation and consideration of an EIR,
and thus constitutes effective relief.
11
II. Timing of EIR Preparation
We turn to the substantive CEQA issue presented: Was City required to
prepare and consider an EIR before approving the conveyance and development
agreement on May 3 and executing the revised agreement on August 9, 2004? To
answer this question, we first outline, in this part of the opinion, the existing law
on timing of EIR preparation and the legislative policies that shape this law. We
next address, in part III, the general question of whether an agency may delay EIR
preparation by making its final approval of a project contingent on subsequent
CEQA compliance, while otherwise agreeing to go forward with the project. In
part IV, we apply our conclusions to the facts of this case to determine that City’s
May 3 and August 9 actions constituted project approval requiring prior
preparation of an EIR.
We begin with CEQA’s text. Section 21100, subdivision (a) provides in
pertinent part: “All lead agencies shall prepare, or cause to be prepared by
contract, and certify the completion of, an environmental impact report on any
project which they propose to carry out or approve that may have a significant
effect on the environment.” (Italics added.) To the same effect, section 21151
provides that “local agencies shall prepare, or cause to be prepared by contract,
and certify the completion of, an environmental impact report on any project that
they intend to carry out or approve which may have a significant effect on the
environment.” (Italics added.)6
6 Both sections appear applicable to City. Section 21151 applies to local
governments by its terms. Section 21100, although placed in a chapter of CEQA
mainly addressing the duties of state agencies, itself applies to all “lead agencies,”
a term that includes local public entities undertaking projects subject to CEQA.
(See §§ 21067 [“ ‘Lead agency’ means the public agency which has the principal
responsibility for carrying out or approving a project which may have a significant
effect upon the environment”], 21063 [“ ‘Public agency’ includes any state
(footnote continued on next page)
12
While the statutes do not specify criteria for determining when an agency
“approve[s]” a project, the law’s implementing regulations, the CEQA Guidelines
(Cal. Code Regs., tit. 14, § 15000 et seq.),7 do address the question. Section
15352 of the CEQA Guidelines provides as follows:
“(a) ‘Approval’ means the decision by a public agency which commits the
agency to a definite course of action in regard to a project intended to be carried
out by any person. The exact date of approval of any project is a matter
determined by each public agency according to its rules, regulations, and
ordinances. Legislative action in regard to a project often constitutes approval.
“(b) With private projects, approval occurs upon the earliest commitment to
issue or the issuance by the public agency of a discretionary contract, grant,
subsidy, loan, or other form of financial assistance, lease, permit, license,
certificate, or other entitlement for use of the project.” (Cal. Code Regs., tit. 14,
§ 15352, subds. (a), (b).)
CEQA Guidelines section 15004, subdivision (b) observes that “[c]hoosing
the precise time for CEQA compliance involves a balancing of competing factors.
EIRs and negative declarations should be prepared as early as feasible in the
planning process to enable environmental considerations to influence project
(footnote continued from previous page)
agency, board, or commission, any county, city and county, city, regional agency,
public district, redevelopment agency, or other political subdivision”].)
7 “The CEQA Guidelines, promulgated by the state’s Resources Agency, are
authorized by Public Resources Code section 21083. In interpreting CEQA, we
accord the Guidelines great weight except where they are clearly unauthorized or
erroneous.” (Vineyard Area Citizens for Responsible Growth, Inc. v. City of
Rancho Cordova (2007) 40 Cal.4th 412, 428, fn. 5.)
13
program and design and yet late enough to provide meaningful information for
environmental assessment.” (Cal. Code Regs., tit. 14, § 15004, subd. (b).)8
This court has on several occasions addressed the timing of environmental
review under CEQA, emphasizing in each case the same policy balance outlined
in CEQA Guidelines section 15004, subdivision (b). In No Oil, Inc. v. City of Los
Angeles (1974) 13 Cal.3d 68 (No Oil, Inc.), discussing whether the proper scope of
an EIR included possible related future actions, we quoted this observation from a
federal decision: “ ‘Statements must be written late enough in the development
process to contain meaningful information, but they must be written early enough
so that whatever information is contained can practically serve as an input into the
decision making process.’ ” (Id. at p. 77, fn. 5.) We again quoted this formulation
of the general issue in Fullerton Joint Union High School Dist. v. State Bd. of
Education (1982) 32 Cal.3d 779 (Fullerton), which considered whether a
particular action was a “project” for CEQA purposes, adding, with what has turned
8 The parties’ briefs frame the timing issue here in two ways: (1) Did City,
in May and August of 2004, approve the 1343 Laurel project? and (2) Was the
contingent agreement to convey and develop 1343 Laurel itself a project? While
this opinion will discuss some relevant decisions on the definition of a project, it
largely follows the first formulation, asking whether City approved the project. As
section 15378 of the CEQA Guidelines explains: “(a) ‘Project’ means the whole
of an action, which has the potential for resulting in [an environmental change.]
[¶] . . . [¶] (c) The term ‘project’ refers to the activity which is being approved and
which may be subject to several discretionary approvals by government agencies.
The term ‘project’ does not mean each separate government approval.” (Cal.
Code Regs., tit. 14, § 15378.) The “project” in this case is the redevelopment of
1343 Laurel, not any of the individual steps City took to approve it. City and
Laurel Place do not dispute the redevelopment of 1343 Laurel is a project
requiring evaluation in an EIR; they disagree with Save Tara only on the required
timing of that EIR process.
14
out to be an understatement, that “[t]he timing of an environmental study can
present a delicate problem.” (Fullerton, at p. 797.)
In Laurel Heights Improvement Assn. v. Regents of University of California
(1988) 47 Cal.3d 376 (commonly known as Laurel Heights I), again discussing the
proper scope of an EIR regarding future actions, we summed up the issue and
attempted to state a rule, as follows: “We agree that environmental resources and
the public fisc may be ill served if the environmental review is too early. On the
other hand, the later the environmental review process begins, the more
bureaucratic and financial momentum there is behind a proposed project, thus
providing a strong incentive to ignore environmental concerns that could be dealt
with more easily at an early stage of the project. . . . For that reason, ‘ “EIRs
should be prepared as early in the planning process as possible to enable
environmental considerations to influence project, program or design.” ’ ” (Id. at
p. 395.)9 We also observed that at a minimum an EIR must be performed before a
project is approved, for “[i]f postapproval environmental review were allowed,
EIR’s would likely become nothing more than post hoc rationalizations to support
action already taken.” (Laurel Heights I, at p. 394.)
This court, like the CEQA Guidelines, has thus recognized two
considerations of legislative policy important to the timing of mandated EIR
preparation: (1) that CEQA not be interpreted to require an EIR before the project
is well enough defined to allow for meaningful environmental evaluation; and
9 In the recent decision of Vineyard Area Citizens for Responsible Growth,
Inc. v. City of Rancho Cordova, supra, 40 Cal.4th at page 441, discussing the
extent to which a large housing project’s EIR was required to address water
sources for the project’s later phases, we reiterated Laurel Heights I’s admonition
that environmental analysis not be delayed to the point where “ ‘bureaucratic and
financial momentum’ ” rendered it practically moot.
15
(2) that CEQA not be interpreted as allowing an EIR to be delayed beyond the
time when it can, as a practical matter, serve its intended function of informing
and guiding decision makers.
The CEQA Guidelines define “approval” as “the decision by a public
agency which commits the agency to a definite course of action in regard to a
project.” (Cal. Code Regs., tit. 14, § 15352, subd. (a).) The problem is to
determine when an agency’s favoring of and assistance to a project ripens into a
“commit[ment].” To be consistent with CEQA’s purposes, the line must be drawn
neither so early that the burden of environmental review impedes the exploration
and formulation of potentially meritorious projects, nor so late that such review
loses its power to influence key public decisions about those projects.
Drawing this line raises predominantly a legal question, which we answer
independently from the agency whose decision is under review. While judicial
review of CEQA decisions extends only to whether there was a prejudicial abuse
of discretion, “an agency may abuse its discretion under CEQA either by failing to
proceed in the manner CEQA provides or by reaching factual conclusions
unsupported by substantial evidence. (§ 21168.5.) Judicial review of these two
types of error differs significantly: while we determine de novo whether the
agency has employed the correct procedures, ‘scrupulously enforc[ing] all
legislatively mandated CEQA requirements’ (Citizens of Goleta Valley v. Board of
Supervisors (1990) 52 Cal.3d 553, 564), we accord greater deference to the
agency’s substantive factual conclusions.” (Vineyard Area Citizens for
Responsible Growth, Inc. v. City of Rancho Cordova, supra, 40 Cal.4th at p. 435.)
A claim, like Save Tara’s here, that the lead agency approved a project with
potentially significant environment effects before preparing and considering an
EIR for the project “is predominantly one of improper procedure” (Vineyard Area
Citizens for Responsible Growth, Inc. v. City of Rancho Cordova, supra, 40
16
Cal.4th at p. 435) to be decided by the courts independently. The claim goes not
to the validity of the agency’s factual conclusions but to the required timing of its
actions. Moreover, as noted above (fn. 8, ante), the timing question may also be
framed by asking whether a particular agency action is in fact a “project” for
CEQA purposes, and that question, we have held, is one of law. (Muzzy Ranch
Co. v. Solano County Airport Land Use Com. (2007) 41 Cal.4th 372, 382;
Fullerton, supra, 32 Cal.3d at p. 795.)10
Considering the timing issue as one of legally proper procedure does not
remove all logistical discretion from agencies; it merely sets an outer limit to how
long EIR preparation may be delayed. To accord overly deferential review of
agencies’ timing decisions could allow agencies to evade CEQA’s central
commands. While an agency may certainly adjust its rules so as to set “[t]he exact
date of approval” (Cal. Code Regs., tit. 14, § 15352, subd. (a)), an agency has no
discretion to define approval so as to make its commitment to a project precede the
required preparation of an EIR.
III. Development Agreements Contingent on CEQA Compliance
The May 3 draft agreement and August 9 executed agreement conditioned
City’s obligation to convey the property to Laurel Place for development on all
10 In Mount Sutro Defense Committee v. Regents of University of California
(1978) 77 Cal.App.3d 20, 40, the Court of Appeal remarked that “the
determination of the earliest feasible time [for environmental review] is to be
made initially by the agency itself, which decision must be respected in the
absence of manifest abuse.” (Accord, Stand Tall on Principles v. Shasta Union
High Sch. Dist. (1991) 235 Cal.App.3d 772, 780; see also City of Vernon v. Board
of Harbor Comrs. (1998) 63 Cal.App.4th 677, 690 [“the timing of an EIR is
committed to the discretion and judgment of the agency”].) To the extent these
opinions contradict our determination that postponement of an EIR until after
project approval constitutes procedural error that is independently reviewable, we
disapprove them.
17
applicable requirements of CEQA having been satisfied. City and Laurel Place
contend such a CEQA compliance condition on an agreement to convey or
develop property eliminates the need for preparation of an EIR (or any other
CEQA document) before an agency approves the agreement. In contrast, Save
Tara, quoting the Court of Appeal, maintains that permitting a CEQA compliance
condition to postpone environmental review until after an agreement on the project
has been reached would render the EIR requirement a “dead letter.” We adopt an
intermediate position: A CEQA compliance condition can be a legitimate
ingredient in a preliminary public-private agreement for exploration of a proposed
project, but if the agreement, viewed in light of all the surrounding circumstances,
commits the public agency as a practical matter to the project, the simple insertion
of a CEQA compliance condition will not save the agreement from being
considered an approval requiring prior environmental review.
As previously noted, the CEQA Guideline defining “approval” states that
“with private projects, approval occurs upon the earliest commitment to issue or
the issuance by the public agency of a discretionary contract, grant, subsidy, loan,
or other form of financial assistance, lease, permit, license, certificate, or other
entitlement for use of the project.” (Cal. Code Regs., tit. 14, § 15352, subd. (b).)11
On its face, this regulatory definition suggests a public agency’s execution of a
contract to convey a property for development would constitute approval of the
development project. City and Laurel Place rely on two decisions holding
11 The guideline derives in part from Public Resources Code section 21065,
which defines “project” as including a private activity supported by public
contracts, grants, or other assistance, or requiring issuance of a public permit,
license, or other entitlement. (Id., subds. (b), (c).)
18
agreements not to be approvals for CEQA purposes when conditioned on later
CEQA compliance.
In Stand Tall on Principles v. Shasta Union High Sch. Dist., supra, 235
Cal.App.3d 772 (Stand Tall), a school district board passed resolutions choosing
the site for a new high school from a group of finalists and authorizing the district
administration to purchase the property; any offer to purchase “was to be made
contingent upon completion of the EIR process and final state approval.” (Id. at
p. 777.) The appellate court rejected a claim the EIR should have been done
before selecting the preferred school site, reasoning that “the Board’s resolutions
regarding the site selection do not constitute an ‘approval’ under CEQA because
they do not commit the District to a definite course of action since they are
expressly made contingent on CEQA compliance.” (Id. at p. 781.)
In Concerned McCloud Citizens v. McCloud Community Services Dist.
(2007) 147 Cal.App.4th 181 (McCloud), a district executed an agreement with a
commercial spring water bottler for exclusive rights to bottle and sell water from
the district’s sources, contingent on, among other things, the district and the bottler
“ ‘completing, during the Contingency Period, proceedings under CEQA in
connection with the Project, and the expiration of the applicable period for any
challenge to the adequacy of District’s and [the bottler’s] compliance with CEQA
without any challenge being filed.’ ” (Id. at p. 188.) Relying in part on Stand
Tall, the McCloud court held no EIR was required before the district executed the
contingent bottling agreement. The agreement was subject to several “ ‘ifs,’ ” the
court reasoned, continuing: “The biggest ‘if’ in the agreement however is if all
discretionary permits, expressly defined as including CEQA documentation,
review and approvals, along with the final adjudication of any legal challenges
based on CEQA, are secured and all environmental, title, physical, water quality
and economic aspects of the project are assessed.” (McCloud, at p. 193.)
19
Without questioning the correctness of Stand Tall and McCloud on their
facts, we note that each case involved particular circumstances limiting the reach
of its logic; neither convinces us a broad rule exists permitting EIR preparation to
be postponed in all circumstances by use of a CEQA compliance condition.
In McCloud, the court relied in part on the agreement’s lack of information
as to the springs that would be exploited, the site of the bottling plant, how the
water would be transported, and other details essential to environmental analysis
of the project. Without that information, the court concluded, “preparation of an
EIR would be premature. Any analysis of potential environmental impacts would
be wholly speculative and essentially meaningless.” (McCloud, supra, 147
Cal.App.4th at p. 197.) In the terms used by the CEQA Guidelines to define
“approval” — “the decision by a public agency which commits the agency to a
definite course of action” (Cal. Code Regs, tit. 14, § 15352, subd. (a)) — McCloud
thus speaks as much to definiteness as to commitment and does not establish that a
conditional agreement for development never constitutes approval of the
development.
Stand Tall, supra, 235 Cal.App.3d 772, involved an agreement to purchase
property, an activity that, as a practical matter in a competitive real estate market,
may sometimes need to be initiated before completing CEQA analysis. The
CEQA Guidelines accommodate this need by making an exception to the rule that
agencies may not “make a decision to proceed with the use of a site for facilities
which would require CEQA review” before conducting such review; the exception
provides that “agencies may designate a preferred site for CEQA review and may
enter into land acquisition agreements when the agency has conditioned the
agency’s future use of the site on CEQA compliance.” (Cal. Code Regs., tit. 14,
§ 15004, subd. (b)(2)(A).) The Guidelines’ exception for land purchases is a
reasonable interpretation of CEQA, but it should not swallow the general rule
20
(reflected in the same regulation) that a development decision having potentially
significant environmental effects must be preceded, not followed, by CEQA
review. (See Laurel Heights I, supra, 47 Cal.3d at p. 394 [“A fundamental
purpose of an EIR is to provide decision makers with information they can use in
deciding whether to approve a proposed project, not to inform them of the
environmental effects of projects that they have already approved”].)
City and Laurel Place apparently would limit the “commit[ment]” that
constitutes approval of a private project for CEQA purposes (Cal. Code Regs.,
tit. 14, § 15352, subd. (a)) to unconditional agreements irrevocably vesting
development rights. In their view, “[t]he agency commits to a definite course of
action . . . by agreeing to be legally bound to take that course of action.” (City of
Vernon v. Board of Harbor Comrs., supra, 63 Cal.App.4th at p. 688.) On this
theory, any development agreement, no matter how definite and detailed, even if
accompanied by substantial financial assistance from the agency and other strong
indications of agency commitment to the project, falls short of approval so long as
it leaves final CEQA decisions to the agency’s future discretion.
Such a rule would be inconsistent with the CEQA Guidelines’ definition of
approval as the agency’s “earliest commitment” to the project. (Cal. Code Regs.,
tit. 14, § 15352, subd. (b), italics added.) Just as CEQA itself requires
environmental review before a project’s approval, not necessarily its final
approval (Pub. Resources Code, §§ 21100, 21151), so the guideline defines
“approval” as occurring when the agency first exercises its discretion to execute a
contract or grant financial assistance, not when the last such discretionary decision
is made.
Our own decisions are to the same effect: we have held an agency
approved a project even though further discretionary governmental decisions
would be needed before any environmental change could occur. (See Muzzy
21
Ranch Co. v. Solano County Airport Land Use Com., supra, 41 Cal.4th at p. 383
[adoption of airport land use plan held to be a project even though it directly
authorized no new development]; Fullerton, supra, 32 Cal.3d at p. 795 [adoption
of school district succession plan held to be a project even though “further
decisions must be made before schools are actually constructed”]; Bozung v. Local
Agency Formation Com. (1975) 13 Cal.3d 263, 279, 282 [regional agency’s
approval of annexation by city held to be a project even though further approvals,
including zoning changes, would be needed for property development to occur].)
Though these decisions framed the question as whether certain agency steps
constituted projects, rather than whether the agency had approved a project, they
stand for the principle that CEQA review may not always be postponed until the
last governmental step is taken.
Moreover, limiting approval to unconditional agreements that irrevocably
vest development rights would ignore what we have previously recognized, that
postponing environmental analysis can permit “bureaucratic and financial
momentum” to build irresistibly behind a proposed project, “thus providing a
strong incentive to ignore environmental concerns.” (Laurel Heights I, supra, 47
Cal.3d at p. 395.)
A public entity that, in theory, retains legal discretion to reject a proposed
project may, by executing a detailed and definite agreement with the private
developer and by lending its political and financial assistance to the project, have
as a practical matter committed itself to the project. When an agency has not only
expressed its inclination to favor a project, but has increased the political stakes by
publicly defending it over objections, putting its official weight behind it, devoting
substantial public resources to it, and announcing a detailed agreement to go
forward with the project, the agency will not be easily deterred from taking
whatever steps remain toward the project’s final approval.
22
For similar reasons, we have emphasized the practical over the formal in
deciding whether CEQA review can be postponed, insisting it be done early
enough to serve, realistically, as a meaningful contribution to public decisions.
(See Fullerton, supra, 32 Cal.3d at p. 797 [“as a practical matter,” school district
succession plan was a project requiring review]; No Oil, Inc., supra, 13 Cal.3d at
p. 77, fn. 5 [“ ‘Statements must be written . . . early enough so that whatever
information is contained can practically serve as an input into the decision making
process’ ”]; see also Citizens for Responsible Government v. City of Albany (1997)
56 Cal.App.4th 1199, 1221 [CEQA review should not be delayed to the point
where it would “call for a burdensome reconsideration of decisions already
made”].) The full consideration of environmental effects CEQA mandates must
not be reduced “ ‘to a process whose result will be largely to generate paper, to
produce an EIR that describes a journey whose destination is already
predetermined.’ ” (Natural Resources Defense Council, Inc. v. City of Los
Angeles (2002) 103 Cal.App.4th 268, 271.)
We note as well that postponing EIR preparation until after a binding
agreement for development has been reached would tend to undermine CEQA’s
goal of transparency in environmental decisionmaking. Besides informing the
agency decision makers themselves, the EIR is intended “to demonstrate to an
apprehensive citizenry that the agency has in fact analyzed and considered the
ecological implications of its actions.” (No Oil, Inc., supra, 13 Cal.3d at p. 86;
accord, Laurel Heights I, supra, 47 Cal.3d at p. 392.) When an agency reaches a
binding, detailed agreement with a private developer and publicly commits
resources and governmental prestige to that project, the agency’s reservation of
CEQA review until a later, final approval stage is unlikely to convince public
observers that before committing itself to the project the agency fully considered
the project’s environmental consequences. Rather than a “document of
23
accountability” (Laurel Heights I, at p. 392), the EIR may appear, under these
circumstances, a document of post hoc rationalization.
On the other hand, we cannot agree with the suggestion of the Court of
Appeal, supported by Save Tara, that any agreement, conditional or unconditional,
would be an “approval” requiring prior preparation of CEQA documentation if at
the time it was made the project was sufficiently well defined to provide
“ ‘meaningful information for environmental assessment.’ ” (Citizens for
Responsible Government v. City of Albany, supra, 56 Cal.App.4th at p. 1221,
quoting Cal. Code Regs., tit. 14, § 15004, subd. (b).) On this theory, once a
private project had been described in sufficient detail, any public-private
agreement related to the project would require CEQA review.
This rule would be inconsistent with the CEQA Guidelines’ definition of
approval as involving a “commit[ment]” by the agency. (Cal. Code Regs., tit. 14,
§ 15352, subd. (a).) Agencies sometimes provide preliminary assistance to
persons proposing a development in order that the proposal may be further
explored, developed or evaluated. Not all such efforts require prior CEQA review.
(See, e.g., Cal. Code Regs., tit. 14, § 15262 [conduct of feasibility or planning
studies does not require CEQA review].) Moreover, privately conducted projects
often need some form of government consent or assistance to get off the ground,
sometimes long before they come up for formal approval. Approval, within the
meaning of Public Resources Code sections 21100 and 21151, cannot be equated
with the agency’s mere interest in, or inclination to support, a project, no matter
how well defined. “If having high esteem for a project before preparing an
environmental impact statement (EIR) nullifies the process, few public projects
would withstand judicial scrutiny, since it is inevitable that the agency proposing a
project will be favorably disposed to it.” (City of Vernon v. Board of Harbor
Comrs., supra, 63 Cal.App.4th at p. 688.)
24
As amicus curiae League of California Cities explains, cities often reach
purchase option agreements, memoranda of understanding, exclusive negotiating
agreements, or other arrangements with potential developers, especially for
projects on public land, before deciding on the specifics of a project. Such
preliminary or tentative agreements may be needed in order for the project
proponent to gather financial resources for environmental and technical studies, to
seek needed grants or permits from other government agencies, or to test interest
among prospective commercial tenants. While we express no opinion on whether
any particular form of agreement, other than those involved in this case,
constitutes project approval, we take the League’s point that requiring agencies to
engage in the often lengthy and expensive process of EIR preparation before
reaching even preliminary agreements with developers could unnecessarily burden
public and private planning. CEQA review was not intended to be only an
afterthought to project approval, but neither was it intended to place unneeded
obstacles in the path of project formulation and development.
In addition to the regulatory definition of “approval” quoted earlier (Cal.
Code Regs., tit. 14, § 15352, subd. (b)), Save Tara relies on Citizens for
Responsible Government v. City of Albany, supra, 56 Cal.App.4th 1199 (Citizens
for Responsible Government) for the principle that an EIR must be prepared before
a public agency executes a detailed agreement for development. In that case, the
city council decided to place before the voters a proposal for development of a
gaming facility at a racetrack; included in the proposal was an agreement with the
private developer setting out details of the proposed facility and its operation. (Id.
at p. 1206.) Although the agreement called for the developer to submit any studies
needed “ ‘to address any potential adverse environmental impact of the Project’ ”
and provided that “ ‘[a]ll reasonably feasible mitigation measures shall become
conditions’ ” of the city’s implementation agreement (id. at pp. 1219-1220), the
25
appellate court held the city council had approved the project, for CEQA purposes,
by putting it on the ballot, and thus the agreed-to environmental analysis came too
late: “[T]he appropriate time to introduce environmental considerations into the
decision making process was during the negotiation of the development
agreement. Decisions reflecting environmental considerations could most easily
be made when other basic decisions were being made, that is, during the early
stage of ‘project conceptualization, design and planning.’ Since the development
site and the general dimensions of the project were known from the start, there
was no problem in providing ‘meaningful information for environmental
assessment.’ At this early stage, environmental review would be an integral part
of the decisionmaking process. Any later environmental review might call for a
burdensome reconsideration of decisions already made and would risk becoming
the sort of ‘post hoc rationalization[] to support action already taken,’ which our
high court disapproved in [Laurel Heights I].” (Citizens for Responsible
Government, at p. 1221.)
Again, without questioning the correctness of this decision on its facts, we
find it falls short of demonstrating a general rule against use of conditional
agreements to postpone CEQA review. The development agreement in Citizens
for Responsible Government, once approved by the voters, vested the developer
with the right to build and operate a card room within particular parameters set out
in the agreement. The city had thus “contracted away its power to consider the
full range of alternatives and mitigation measures required by CEQA” and had
precluded consideration of a “no project” option. (Citizens for Responsible
Government, supra, 56 Cal.App.4th at pp. 1221-1222.) “Indeed, the purpose of a
development agreement is to provide developers with an assurance that they can
complete the project. After entering into the development agreement with [the
26
developer], the City is not free to reconsider the wisdom of the project in light of
environmental effects.” (Id. at p. 1223.)12
Desirable, then, as a bright-line rule defining when an approval occurs
might be, neither of those proposed — the execution of an unconditional
agreement irrevocably vesting development rights, or of any agreement for
development concerning a well-defined project — is consistent with CEQA’s
interpretation and policy foundation. Instead, we apply the general principle that
before conducting CEQA review, agencies must not “take any action” that
significantly furthers a project “in a manner that forecloses alternatives or
mitigation measures that would ordinarily be part of CEQA review of that public
project.” (Cal. Code Regs., tit. 14, § 15004, subd. (b)(2)(B); accord, McCloud,
supra, 147 Cal.App.4th at p. 196 [agreement not project approval because, inter
alia, it “did not restrict the District’s discretion to consider any and all mitigation
measures, including the ‘no project’ alternative”]; Citizens for Responsible
Government, supra, 56 Cal.App.4th at p. 1221 [development agreement was
project approval because it limited city’s power “to consider the full range of
alternatives and mitigation measures required by CEQA”].)
In applying this principle to conditional development agreements, courts
should look not only to the terms of the agreement but to the surrounding
12 Citizens for Responsible Government’s references to a “development
agreement” were to development agreements as described in Government Code
section 65865.2, which allows for only such conditions as “shall not prevent
development of the land for the uses and to the density or intensity of development
set forth in the agreement.” The purpose of such agreements is to give
“[a]ssurance to the applicant for a development project that upon approval of the
project, the applicant may proceed with the project in accordance with existing
policies, rules and regulations . . . .” (Gov. Code, § 65864, subd. (b); see Citizens
for Responsible Government, supra, 56 Cal.App.4th at pp. 1213-1214.)
27
circumstances to determine whether, as a practical matter, the agency has
committed itself to the project as a whole or to any particular features, so as to
effectively preclude any alternatives or mitigation measures that CEQA would
otherwise require to be considered, including the alternative of not going forward
with the project. (See Cal. Code Regs, tit. 14, § 15126.6, subd. (e).) In this
analysis, the contract’s conditioning of final approval on CEQA compliance is
relevant but not determinative.
A frequently cited treatise on CEQA (Remy et al., Guide to the Cal.
Environmental Quality Act (CEQA) (11th ed. 2006)) summarizes this approach in
a useful manner. “First, the analysis should consider whether, in taking the
challenged action, the agency indicated that it would perform environmental
review before it makes any further commitment to the project, and if so, whether
the agency has nevertheless effectively circumscribed or limited its discretion with
respect to that environmental review. Second, the analysis should consider the
extent to which the record shows that the agency or its staff have committed
significant resources to shaping the project. If, as a practical matter, the agency
has foreclosed any meaningful option to going forward with the project, then for
purposes of CEQA the agency has ‘approved’ the project.” (Id. at p. 71.) As this
passage suggests, we look both to the agreement itself and to the surrounding
circumstances, as shown in the record of the decision, to determine whether an
agency’s authorization or execution of an agreement for development constitutes a
“decision . . . which commits the agency to a definite course of action in regard to
a project.” (Cal. Code Regs., tit. 14, § 15352.)
Our analysis does not require CEQA analysis before a definite project has
been formulated and proposed to the agency. An agency cannot be deemed to
have approved a project, within the meaning of Public Resources Code sections
21100 and 21151, unless the proposal before it is well enough defined “to provide
28
meaningful information for environmental assessment.” (Cal. Code Regs., tit. 14,
§ 15004, subd. (b).) Moreover, when the prospect of agency commitment
mandates environmental analysis of a large-scale project at a relatively early
planning stage, before all the project parameters and alternatives are reasonably
foreseeable, the agency may assess the project’s potential effects with
corresponding generality. With complex or phased projects, a staged EIR (Cal.
Code Regs., tit. 14, § 15167) or some other appropriate form of tiering (see In re
Bay-Delta et al. (2008) 43 Cal.4th 1143, 1170; Vineyard Area Citizens for
Responsible Growth, Inc. v. City of Rancho Cordova, supra, 40 Cal.4th at p. 431)
may be used to postpone to a later planning stage the evaluation of those project
details that are not reasonably foreseeable when the agency first approves the
project.
IV. Application to City’s Decisions
We turn finally to whether the city council’s approval of the draft
agreement on May 3, 2004, and the city manager’s execution of the revised
agreement on August 9 of the same year constituted approval of the 1343 Laurel
project for purposes of sections 21100 and 21151. From the agreements and the
surrounding circumstances, we conclude City did approve the 1343 Laurel project
in substance, though it reserved some of the project’s design details for later
environmental analysis and final decision.
The contract between City and Laurel Place demonstrates City’s
commitment to the project. Both the May 3 draft and the August 9 executed
agreements forthrightly stated their purpose was to “cause the reuse and
redevelopment” of 1343 Laurel in accordance with the project as outlined in the
agreements and in the earlier HUD grant application. The city council’s May 3
29
resolution, similarly, stated the intent to “facilitate development of the project” —
while allowing further public input on “the design of project elements.”
In both versions of the agreement, moreover, City agreed to initially lend
the developer nearly half a million dollars, a promise not conditioned on CEQA
compliance. This predevelopment portion was to be advanced in the first phase of
the agreement’s performance, before EIR approval and issuance of other final
approvals, and was to be repaid from project receipts over a period of up to
55 years. If City did not give final approval to the project, therefore, it would not
be repaid. For a relatively small government like City’s, this was not a trivial
outlay, and it would be wasted unless City gave final approval to the project in
some form.
While both versions of the agreement conditioned conveyance of the
property and disbursement of the second half of the loan on CEQA compliance,
among other conditions, the May 3 draft agreement significantly circumscribed
City’s remaining authority in this regard. Under the draft agreement, whether
CEQA requirements had been met was to be “reasonably determined by the City
Manager,” language that could have left City open to charges it acted
unreasonably, had it ultimately declined to certify the EIR or make any needed
CEQA findings.
In addition, the May 3 draft agreement, in setting the condition that all
“requirements of CEQA” be “satisfied,” arguably left open the question whether
City remained free to find that the EIR was legally adequate and yet to reject the
project on substantive environmental grounds. An EIR that “satisfies” CEQA
“requirements” may nonetheless demonstrate the project carries with it significant
immitigable adverse effects. The May 3 draft agreement’s condition does not
clearly encompass the possibility that in such a situation City could decline to find,
30
pursuant to section 21081, subdivision (b), that the project’s benefits outweigh
such immitigable effects.
Finally, the May 3 draft agreement had no provision for appealing to the
city council the city manager’s decision on, or waiver of, CEQA compliance.
Such a delegation of the council’s authority was itself an impermissible attempt to
approve the project without prior CEQA review. (See Sundstrom v. County of
Mendocino (1988) 202 Cal.App.3d 296, 307 [permit condition requiring applicant
to submit environmental study to the planning commission and adopt any
mitigation measures formulated by commission staff was an improper delegation
of CEQA responsibility to staff and an impermissible postponement of
environmental review].)
After Save Tara sued, alleging some of these same flaws in the May 3 draft
agreement, City staff revised the agreement to repair them. Under the August 9
executed agreement, the city manager no longer had authority to determine or
waive CEQA compliance, and City’s “complete discretion” over CEQA matters
was expressly acknowledged. But the city council had already approved the
May 3 draft agreement, by which it had shown a willingness to give up further
authority over CEQA compliance in favor of dependence on the city manager’s
determination. Given that history, as well as the other circumstances discussed
below, City’s “apprehensive citizenry” (No Oil, Inc., supra, 13 Cal.3d at p. 86)
could be forgiven if they were skeptical as to whether the city council would give
adverse impacts disclosed in the EIR full consideration before finally approving
the project.
Circumstances surrounding City’s approval of the agreements confirm
City’s commitment to the 1343 Laurel project. In aid of Laurel Place’s HUD
grant application, the city manager told the federal agency City “has approved the
sale of the property” and “will commit” up to $1 million in financial aid. Once the
31
grant was awarded, City’s mayor announced it “will be used” for Laurel Place’s
project, and the City newsletter stated that, using the grant, City and Laurel Place
“will redevelop the property.” City officials told residents who opposed the
project that while “variations” on the proposal would be entertained, City “must
continue on a path that fulfills this obligation” to redevelop the property for senior
housing. Similarly, at the May 3, 2004, city council meeting, City’s housing
manager stated that while there were “options to consider” regarding project
design, options for other uses of the property (as a park, library, or cultural center)
had already been ruled out.13
Finally, City proceeded with tenant relocation on the assumption the
property would be redeveloped as in the proposed project. After HUD awarded
the grant, City’s housing manager told a tenant that she would be relocated,
though not for a year or so. Around the same time, other tenants reported being
contacted by relocation consultants, who told them they would soon be given one-
year notices. As part of its May 3, 2004, resolution, the city council authorized the
predevelopment loan in order to, among other things, “begin the process of
working with tenants to explore relocation options.” The May 3 draft and
13 At oral argument, counsel for City and Laurel Place urged strenuously that
expressions of enthusiasm for a project by an agency’s staff members should not
be confused with official approval of a project. We agree. In isolation, such
statements could rarely, if ever, be deemed approvals for CEQA purposes. Here,
of course, we weigh statements by City officials not in isolation but as one
circumstance shedding light on the degree of City’s commitment when it approved
the May 3 and August 9 agreements. It bears noting, as well, that one of the
statements upon which we rely was a communication from City’s mayor, another
appeared in an official City newsletter, and others were from City’s housing
manager, who, having been named in the mayor’s announcement as the contact
person for residents with questions about the proposed development, had apparent
authority to speak for City on this topic.
32
August 9 executed agreements provided that Laurel Place would “complete the
relocation of tenants” in the agreement’s first performance phase, that is, before
final project approval was given and the property conveyed to Laurel Place. A
staff report on the May 3 draft agreement stated that relocation notices, with a one-
year period, would be sent shortly after the agreement was executed. The
August 9 executed agreement further specified the process was to begin within 30
days.
Relocation of tenants is a significant step in a redevelopment project’s
progress, and one that is likely to be irreversible. City’s willingness to begin that
process as soon as the conditional development agreement was executed, and to
complete it before certifying an EIR and finally approving the project, tends
strongly to show that City’s commitment to the 1343 Laurel project was not
contingent on review of an EIR.
In summary, City’s public announcements that it was determined to
proceed with the development of low-income senior housing at 1343 Laurel, its
actions in accordance with that determination by preparing to relocate tenants
from the property, its substantial financial contribution to the project, and its
willingness to bind itself, by the May 3 draft agreement, to convey the property if
the developer “satisfied” CEQA’s “requirements, as reasonably determined by the
City Manager,” all demonstrate that City committed itself to a definite course of
action regarding the project before fully evaluating its environmental effects. That
is what sections 21110 and 21151 prohibit.
CONCLUSION
For the reasons given above, we agree with the Court of Appeal that City
must be ordered to “declare void its approval of the May and August 2004
Agreements” and to reconsider those decisions in light of a legally adequate EIR
for the project. (See § 21168.9, subd. (a)(1).) If that reconsideration leads to
33
approval of the project, City must make any appropriate findings under section
21081.
Unlike the Court of Appeal, however, we do not believe City necessarily
must prepare a new EIR before reconsidering its approval of the project. The
parties agree City certified a final EIR for the project in 2006, during pendency of
this appeal, and Save Tara did not judicially challenge that EIR’s legal adequacy.
Under section 21167.2, the 2006 EIR is conclusively presumed to comply with
CEQA’s standards unless a subsequent or supplemental environmental EIR is
needed for any of the reasons set out in section 21166 (discussed below).
The 2006 EIR was prepared after City approved the May 3 and August 9,
2004, agreements, which approvals must be now vacated. To the extent the 2006
EIR’s discussion of project alternatives and mitigation measures was premised on
City’s 2004 approvals, that discussion may need revision. Moreover, by the time
of our remand more than two years will have passed since the EIR was certified in
October 2006. Because of both these factors, it is possible that “[s]ubstantial
changes [have] occur[red] with respect to the circumstances under which the
project is being undertaken which will require major revisions in the
environmental impact report” or that “[n]ew information, which was not known
and could not have been known at the time the environmental impact report was
certified as complete, [has] become[] available.” (Pub. Resources Code, § 21166,
subds. (b), (c); see also Cal. Code Regs., tit. 14, §§ 15162, 15163 [subsequent and
supplemental EIR’s].) Whether this is so must be decided in the first instance by
City and reviewed by the superior court on a substantial evidence standard. (See
Santa Teresa Citizen Action Group v. City of San Jose (2003) 114 Cal.App.4th
689, 704.)
34
This matter must therefore be returned to the superior court for that court
(1) to order City to set aside its prior approval of the project; (2) if City decides no
subsequent or supplemental EIR is required under section 21166, to review that
decision; and (3) to make any other order necessary and proper under section
21168.9.
DISPOSITION
The judgment of the Court of Appeal is affirmed in part and reversed in
part. The matter is remanded to the Court of Appeal for further proceedings
consistent with our opinion.
WERDEGAR, J.
WE CONCUR:
GEORGE, C. J.
KENNARD, J.
BAXTER, J.
CHIN, J.
MORENO, J.
CORRIGAN, J.
See next page for addresses and telephone numbers for counsel who argued in Supreme Court.
Name of Opinion Save Tara v. City of West Hollywood
__________________________________________________________________________________
Unpublished Opinion
Original Appeal
Original Proceeding
Review Granted XXX 147 Cal.App.4th 1091
Rehearing Granted
__________________________________________________________________________________
Opinion No. S151402
Date Filed: October 30, 2008
__________________________________________________________________________________
Court: Superior
County: Los Angeles
Judge: Ernest M. Hiroshige
__________________________________________________________________________________
Attorneys for Appellant:
Chatten-Brown & Carstens, Jan Chatten-Brown, Douglas P. Carstens, Katherine A. Trisolini and Amy C.
Minteer for Plaintiff and Appellant.
Law Offices of Michael W. Stamp and Michael W. Stamp for Save Our Carmel River and The Open
Monterey Project as Amici Curiae on behalf of Plaintiff and Appellant.
Frank G. Wells Environmental Law Clinic, Sean B. Hecht; Neighborhood Legal Services of Los Angeles
County, David Pallack and Joshua Stehlik for Lincoln Place Tenants Association, People for Parks, Sierra
Club and Trudy Saposhnek as Amicus Curiae on behalf of Plaintiff and Appellant.
Shute, Mihaly & Weinberger, Rachel B. Hooper, Amy J. Bricker, Michelle W. Anderson; Law Offices of
Donald B. Mooney and Donald B. Mooney for Environmental Defense Center, California Preservation
Foundation, Planning and Conservation League and Natural Resources Defense Council as Amici Curiae
on behalf of Plaintiff and Appellant.
__________________________________________________________________________________
Attorneys for Respondent:
Jenkins & Hogin, Michael Jenkins, John C. Cotti and Christi Hogin for Defendant and Respondent.
Aleshire & Wynder, David Aleshire and Joseph W. Pannone for League of California Cities as Amicus
Curiae on behalf of Defendant and Respondent.
Truman & Elliott, Kathleen O’Prey Truman and Todd Elliott for Housing California and Southern
California Association of Nonprofit Housing as Amici Curiae on behalf of Defendant and Respondent.
Latham & Watkins, James L. Arnone, Stephanie E. Ord, Ernest J. Hahn and Benjamin J. Hanelin for Real
Parties in Interest and Respondents.
Counsel who argued in Supreme Court (not intended for publication with opinion):
Jan Chatten-Brown
Chatten-Brown & Carstens
2601 Ocean Park Boulevard, Suite 205
Santa Monica, CA 90405-3219
(310) 314-8040
Michael Jenkins
Jenkins & Hogin
1230 Rosecrans Avenue, Suite 110
Manhattan Beach, CA 90266-2436
(310) 643-8448
James L. Arnone
Latham & Watkins
633 West Fifth street, Suite 4000
Los Angeles, CA 90071-2007
(213) 485-1234