June 13, 2022 | Category: News

By Braiden Chadwick and Daniel Warren

On May 12, 2022, the First District Court of Appeal (Court) affirmed a trial court judgment in a 108-page opinion and upheld the approval of 43 single-family residential units on a 110-acre parcel located atop a hill in Marin County (County). The County’s approval of the residential subdivision concludes the property owner’s efforts – totaling nearly 50 years – to develop the parcel despite “intense and unrelenting” local opposition from private parties as well as Marin County and the Town of Tiburon (Town). The “essential point” of the Court’s Opinion in Tiburon Open Space Committee v. County of Marin (2022) 78 Cal.App.5th 700 is that where legal obligations constrain a lead agency’s discretion in reviewing a project, the scope of the agency’s environmental review is likewise limited. Although the lead agency is this case was constrained by two stipulated judgments stemming from federal litigation, the principle has broader implications for laws that constrain lead agency discretion regarding residential projects – namely the Housing Accountability Act and the Density Bonus Law. The Opinion also highlights the deepening judicial frustration with CEQA litigation abuse and its impact on California’s housing crisis.

Factual Background

Since the mid-1970s, the Martha Company (Martha) has attempted to develop its 110-acre parcel located in an unincorporated area of the County. In 1974, the County adopted a rezoning measure, reducing the number of units permitted on the parcel from 300 units to a maximum of 34. Martha filed suit in federal district court, alleging the rezoning measure equated to an unconstitutional taking. That litigation produced a stipulated judgment in 1976 in which the County agreed Martha was allowed develop at least 43 single-family homes on half-acre lots.

After several years of planning and submitting its development application to the County and the Town, with neither rendering a decision, the parties returned to federal court in 2005. The County alleged it should be relieved from the 1976 stipulated judgment, arguing that it had illegally contracted away its police power over environmental land use issues. After the federal district court dismissed the County’s claims, the parties entered into another stipulated judgment in 2007. The 2007 Judgment reaffirmed the 1976 Judgment and required the County to “procure a full scope Environmental Impact Report (EIR) for the project,” certify the EIR, and approve 43 home sites on the property. The 2007 Judgment also declared any project alternative or mitigation measure that would not afford Martha its full development rights to be legally infeasible.

Martha filed its current development application in 2008 and the County circulated a draft EIR in 2011. The draft EIR identified and analyzed the project’s environmental setting and its impacts and mitigation measures for several resource areas, including transportation, air quality, noise, geology, hydrology, biological resources, public services, visual quality, and cultural resources. Despite the 2007 Judgment, the draft EIR also considered several alternatives to the project including the CEQA-mandated “No Project” alternative and a reduced density alternative.

In 2013, the Marin County Board of Supervisors declined to certify the EIR, citing issues with residential water pressure, fire flow, and cumulative traffic impacts. Martha returned more than three years later with a revised proposal as demanded by the Board. Finally, in 2017, the Board voted 3 to 2 to certify the final EIR, conditionally approve Martha’s Master Plan, and rezone the property. Notably, the hearing included a warning from County Counsel that the Board was obligated to approve Martha’s proposed development under the federal stipulated judgment and not doing so would incur substantial legal and financial risk. The Town and nearby residential neighbors (i.e., the Tiburon Open Space Committee) filed suit in Marin County Superior Court, which denied their petitions. The Town and the Tiburon Open Space Committee (collectively, the Appellants) then filed an appeal.

 Court of Appeal Decision

On the Appeal, the Appellants alleged the EIR was legally inadequate in numerous respects and that the County, with respect to the stipulated judgments, had contracted away its police power in violation of California law. Before addressing the Appellant’s arguments, the Court reiterated some general CEQA principals relevant to the case before it. Specifically,

  • An EIR need not be exhaustive and resemble a scientific textbook, but it must contain sufficient analysis to allow decisionmakers to make an intelligent decision.
  • “The [lead] agency is the finder of fact and must indulge all reasonable inferences from the evidence that would support the agency’s determination and resolve all evidence in favor of the agency’s decision.”
  • “Legal error, in the form of failure to comply with CEQA, is reviewed independently, but all factual determinations are reviewed according to the substantial evidence standard.”
  • “As with all substantial evidence challenges, an appellant challenging an EIR for insufficient evidence must lay out the evidence favorable to the other side and show why it is lacking. Failure to do so is fatal. A reviewing court will not independently review the record to make for appellant’s failure to carry his burden.”

The Court then turned to Appellant’s argument that the County had abnegated its police powers by allegedly subordinating its responsibilities under CEQA in order to comply with the stipulated judgments. The Court roundly rejected this argument, noting that this “woeful record” before it belied any notion that the County had not engaged in at least some discretion under CEQA. The Court observed that the County produced an 850-page EIR and was attended by an administrative process that took more than six years.

The Court also noted an alarming implication of Appellant’s arguments – that the County was free to ignore the stipulated judgments because they were displaced by CEQA. CEQA, the Court stated, is “not nearly so inflexible.” “Rather, it recognizes that the scope of environmental review must be commensurate with an agency’s retained discretionary authority, including any limitations imposed by legal obligations.” “[W]here a legal obligation limits an agency’s discretion, the scope of environmental review is likewise limited.” Indeed, the Court expressed a “slight puzzlement” at Appellant’s assertion that the County abused its discretion by not adopting the “environmentally superior” lower density 32-unit project alternative. Under the stipulated judgments, the County was under no obligation to even include the alternative in the EIR.

At the end of the Opinion, the Court makes several concluding observations regarding the status quo of CEQA litigation. To illustrate its frustration, the Court quoted from another CEQA case before it in 2009 undergoing a third appeal – “It is probably a truism that since adoption of [CEQA,] every developer has at some point before construction starts ground his teeth or clenched her fists in frustration while enduring the often-lengthy process leading to certification of an [EIR].” The Court acknowledged that “CEQA was meant to serve noble purposes, but it can be manipulated to be a formidable tool of obstruction, particularly against projects that will increase housing density.”

Conclusion

Apart from the topical commentary regarding the use, or misuse, of CEQA, Tiburon Open Space Committee will have important implications in connection with the Housing Accountability Act and other state housing laws. Although CEQA’s requirements will still apply, developers and public agencies defending residential developments can expect to take advantage of this Opinion by potentially limiting the scope of environmental review. Lead agencies and project proponents should always consult with their respective land use counsel to consider whether a project alternative or mitigation measure may be legally infeasible. If you would like to know more about this case, CEQA, or other laws affecting development, please reach out to the authors of this alert or any other member of Mitchell Chadwick’s land use team.