Land Trade and Airport Expansion Expected to Put Mammoth Mountain on "Must Ski" Map

Usually regarded as a local ski area for ski buffs in Northern and Southern California, to which it is readily accessible by car, Mammoth Mountain Ski Area (“MMSA”) is preparing to come into the 21st Century with a new lodge, updated lifts, and, perhaps most important to proponents of the development, an expanded airport.  The expected transformation will be accomplished by the December 12, 2014 passage of the National Defense Authorization Act to which was attached an amendment specifically targeted at the MMSA.  The amendment provides for a land trade of over 1,500 acres of public and private property in proximate counties, for approximately 21 acres of United States Forest Service (“USFS”) land surrounding Mammoth Mountain Inn, which is currently leasing that property as the center of ski operations of the MMSA.  In addition, the Bill allows for a “cash equalization option” to facilitate the exchange, by which MMSA can make up any deficiency in the value of the property conveyed to the USFS with a cash equivalent.  
Most important in MMSA’s view is the expansion of the airport.  

In August, 2014, the Federal Aviation Administration (“FAA”) approved a new Airport Layout Plan (“ALP”) for the Mammoth Yosemite Airport (“Airport”) which includes proposed runway and associated parallel taxiway extensions, land acquisition for those improvements, as well as a terminal expansion.  MMSA believes that “the combination of the Mammoth Mountain land trade and the FAA approval of an expanded commercial airport in Mammoth Lakes is a game changer. . .,” “now, for the first time, the mountain owns the land it resides on and can make improvements it can own.  Plus the new airport will allow for flights from around the country.”

Environmental groups, not unexpectedly, deplore the new events.  Mammoth Mountain is located on the east side of the Sierra Nevada, surrounded by valuable natural resources, including the Owens and Walker Rivers, which are home to a variety of species fast losing habitat elsewhere.  The debate over the expansion will be more clearly articulated during the environmental review process for the land exchange, pursuant to the National Environmental Policy Act, 42 U.S.C. § 4321, et seq. (“NEPA”), which will start upon the signing of the Bill authorizing the land exchange.  
Moreover, the FAA’s approval of the ALP was based on the satisfaction of certain conditions including that: (1) the proposed runway, taxiway extensions and land acquisition are not approved for short term developments; (2) FAA approve a terminal study that includes acceptable forecasts for use of the terminal; and (3) all development must comply with NEPA.  Therefore, development depends not only on the success of the contemplated land purchases, but also upon satisfaction of environmental requirements.  In California, those requirements involve not only NEPA, but also the California Environmental Quality Act, Cal. Pub. Res. Code § 21000, et seq. (“CEQA”) as well, with its much more rigorous analytic requirements.
In summary, although the land trade and associated airport expansion may be seen as a long term benefit to real estate development and the skiing public from outside California, the environmental controversy over the protection of the Eastern Sierra Wilderness will rage for many years to come. 

The Federal Surface Transportation Board Finds California Environmental Quality Act Preempted as Applied to High-Speed Rail Projects

In a surprising decision, Surface Transportation Board Decision, Docket No. FD35861, December 12, 2014 (“Docket”), the Federal Surface Transportation Board (“Board”) ruled that the application of the California Environmental Quality Act (“CEQA”), Cal. Pub. Res. Code § 21000, et seq., to the 114 mile high-speed passenger rail line between Fresno and Bakersfield, California is preempted in its entirety by federal law.  The Board’s decision is not only surprising in the context of prevailing legal authority, but also potentially important in the context of other modes of transportation.  

The decision is surprising because it went far beyond the scope of the petition filed by the responsible State agency, the California High-Speed Rail Authority (“Authority”).  The Authority asked only that the Board find that injunctive relief as a remedy under CEQA is foreclosed as preempted by the Interstate Commerce Commission Termination Act (“ICCTA”), Pub.L. 104–88, 104th Congress, and is, thus, barred under 49 U.S.C. § 10501(b) which gives the Board jurisdiction over “the construction, acquisition, operation, abandonment, or discontinuance of spur, industrial, team, switching, or side tracks, or facilities, even if the tracks are located, or intended to be located, entirely in one State,” 49 U.S.C. § 10501(b)(2).  The Authority further argued that, as it had completed CEQA review in May 2014, the Board need not address whether CEQA is generally preempted, but need only address whether injunctive relief resulting in a work stoppage is available as a remedy in the lawsuits filed against the Authority.
Despite the Authority’s limited petition, the Board expanded its ruling to include a finding that § 10501(b) prevents the states and localities from intruding into matters that are “directly regulated by the Board (e.g., rail carrier rates, services, construction, and abandonment),” Docket, p. 8, and from “imposing requirements that, by their nature, could be used to deny a rail carrier’s ability to conduct rail operations.”  Id.  The Board employs the rationale that “Section 10501(b) [ ] is intended to prevent a patchwork of local regulation from unreasonably interfering with interstate commerce.”  Id.  
The Board recognizes, however, that “[n]ot all state and local regulations that affect rail carriers are preempted by § 10501(b).”  Id. at p. 9.  It acknowledges further that “State and local regulation is appropriate where it does not interfere with rail operations,” Id., and that “[l]ocalities retain their reserved police powers to protect the public health and safety so long as their actions do not unreasonably burden interstate commerce.”  Id.  
On that basis, and ignoring that “states and towns may exercise their traditional police powers . . . to the extent that the regulations ‘protect public health and safety, are settled and defined, can be obeyed with reasonable certainty, entail no extended or open-ended delays, and can be approved (or rejected) without the exercise of discretion on subjective questions,’” Id. citing Green Mountain v. Vermont, 404 F.3d 638, 643 (2nd Cir. 2005), the Board concluded that CEQA was categorically preempted as a “state preclearance requirement that, by its very nature, could be used to deny or significantly delay an entity’s right to construct a line that the Board has specifically authorized, thus impinging upon the Board’s exclusive jurisdiction over rail transportation,” Docket, p. 10, citing DesertXpress Enters., LLC-Pet. For Declaratory Order, slip op. at 5.  The Board further found that CEQA lawsuits “can regulate rail transportation just as effectively as a state statute or regulation.”  Id. at 14, citing, inter alia, Maynard v. CSX Transp., Inc., 360 F. Supp. 2d 836, 840 (E.D. Ky. 2004) [explaining that common law suits constitute regulations].  
The Board decision, however, appears to be based on two fundamental misconceptions. 

First, from a substantive perspective, the Board’s decision erroneously designates CEQA as a “state . . . permitting or preclearance requirement[ ],” Docket, p. 12, that “attempts to regulate where, how, and under what conditions the Authority may construct the Line.”  Id.  However, the cases interpreting CEQA reject this view on the grounds that “a court’s decision to void the approval of a regulation, ordinance or program [as violative of CEQA] does not necessarily require the court to invalidate or suspend the operation of the regulation, ordinance or program.”  See, Poet, LLC v. California Air Resources Board, 218 Cal.App.4th 681, 761 (2003).  Thus, without the imposition of the injunctive remedy (which was the subject of the Authority’s limited petition in the first instance), the most that a finding of inadequacy under CEQA can accomplish is to require that the environmental review be repeated correctly, either procedurally or substantively, during which time the project, rail or otherwise, may proceed apace.  

Moreover, from a procedural perspective, the Board’s decision is defective, because the case upon which the Board principally relies, Friends of the Eel River v. North Coast Railroad Authority, 178 Cal. Rptr. 3d 752 (2014) (for the proposition that “in the context of railroad operations, CEQA ‘is not simply a health and safety regulation imposing an incidental burden on interstate commerce,’” Id. at 767-71), was accepted for review by the California Supreme Court on December 10, 2014, and, thus, is not citable in support of the Board’s decision.  While the Board claims that its analysis, based on Eel River, is merely offered “as the agency authorized by Congress to administer the Interstate Commerce Act, [and, thus,] ‘uniquely qualified’ to address whether § 10501(b) preempts state law,” Docket, p. 5, citing Town of Atherton v. California High-Speed Rail Authority, 175 Cal. Rptr. 3d 145, 161, n. 4 (2014), to the extent the Board’s decision is predicated on the opinion in Eel River, it is unsupported.  
In summary, while the Board’s opinion appears limited to rail projects, its reverberations may be felt throughout numerous modes of transportation, such as aviation, in which the Federal Aviation Act, 49 U.S.C. § 40101, et seq., establishes a system of preemption over the design and operation of airports that is surprisingly similar to that applied by the Board to rail transportation.  See, e.g., 49 U.S.C. § 47521(2).  

California Changes the Test of Significance for Traffic Impacts Under CEQA

Taking its queue from the legislature (see Senate Bill 743 [Steinberg 2013]), the California Governor’s Office of Planning and Research (“OPR”) published, on August 6, 2014, a preliminary discussion draft of revisions to OPR’s California Environmental Quality Act (“CEQA”) Guidelines, which serve as regulations implementing CEQA, Cal. Pub. Res. Code § 21000, et seq.,  “Updating Transportation Impacts Analysis in the CEQA Guidelines” (“Update”).  The Update revises existing CEQA Guidelines § 15064.3 to comport with Cal. Pub. Res. Code § 21099(b)(1) which establishes new criteria for determining the environmental significance of surface traffic impacts such as traffic delay and increased emissions resulting from a proposed project.  The purpose of both the amended statute and the Update is to shift the focus of the CEQA analysis of significance from “driver delay” to “reduction of greenhouse gas emissions, creation of multi-modal  networks and promotion of mixed land uses.”  Update, page 3.  

The change is effected through a change in the metric for determining environmental significance Level of Service (“LOS”), which measures delay at intersections, to vehicle miles traveled (“VMT”), which is a measure of the number of automobile trips resulting from the project.  The stated rationale underlying the change is that the use of LOS encourages mitigation aimed at reducing delays by increasing traffic flow, including expanded roadways, construction of more lanes and other automobile traffic facilitation measures; which theoretically leads to “induced demand,” i.e., more capacity at intersections allowing additional cars to use them; and, ultimately, to more air quality and greenhouse gas impacts from those additional cars.  As the story goes, a standard of environmental significance based on VMT will encourage the use of mitigation measures such as increased bicycle paths, accommodations for pedestrians, and other measures that will reduce automobile ridership in the long term.  The problem is that the theory underlying the Update is made up more of holes than of cheese. 

First, the current draft of the Update rejects the LOS metric categorically, based on the bare conclusion that “a project’s effect on automobile delay does not constitute a significant environmental impact.”  Update, § 15064.3(a).  However, the adoption of the VMT metric, which supposedly captures the emissions impacts caused by a number of cars rather than the time of idling at intersections, is based on a distinction without a difference.  This is because numerous studies have established that a larger number of cars operating at optimal speed will emit fewer air contaminants than a smaller number of cars idling for long periods at congested intersections.  

Second, the Update reaches the further unexplained conclusion that “development projects that locate within one-half mile of either an existing major transit stop or a stop along an existing high quality transit corridor may be considered to have a less than significant transportation impact.”  § 15064.3(b)(1).  Such generalizations cannot withstand rational scrutiny even with respect to relatively small, private residential and commercial projects, without taking into account their size and use.  They are, therefore, clearly inapplicable to large, public use projects such as improvements at Los Angeles International Airport, the raison d'être of which is to facilitate passenger access and growth.  Both of those goals rely principally on automobile access for which a single rail line one-half mile away cannot substitute.  The notion that increases in traffic impact of such  large scale public works projects are environmentally insignificant because of a fortuitous location in relative proximity to a mass transit line amounts to  mere opinion, unsupported by any evidence, let alone substantial evidence.  
Finally, revised § 15064.3(c) decrees that “previously adopted measures to mitigate congestion impacts may continue to be enforced, or modified, at the discretion of the lead agency.”  The discussion at Update page 11 goes even further by stating “in fact, within the bounds of other laws, including adopted general plans, lead agencies have discretion to apply or modify previously adopted mitigation measures.  [Quoting Napa Citizens for Honest Government v. Napa County Board of Sup., (2001) 91 Cal.App.4th 342, 358 (because “mistakes can be made and must be rectified, and . . . the vision of a region’s citizens or its governing body may evolve over time. . . There are times when mitigation measures, once adopted, can be deleted.)]  
Apparently the authors of the Update did not read far enough in Napa Citizens.  That court specifically held that post hoc abrogation of a mitigation measure requires a legitimate reason and support by substantial evidence.  Id. at 359.  Moreover, that evidence is only provided in the context of a modified land use plan and accompanying revised EIR setting forth the reason for the deletion of the prior mitigation measure and justification for the substitute measures.  Id.   The Update, on the other hand, purports to give carte blanche to elimination of a previously enacted mitigation measure without any additional environmental review on the sole ground that “. . . section 21099 of the Public Resources Code states that automobile delay is not a significant impact under CEQA.”  Update, page 11.  The Napa Citizens court, however, would disagree.  Because CEQA requires that mitigation measures not only be stated but enforced; and because the public has the right to depend on that enforcement; any deletion of a previously enacted mitigation measure without the requisite subsequent analysis and formal action replacing it would be “invalid and cannot be enforced.”  Napa Citizens, supra, 91 Cal.App.4th at 359.  
In short, while OPR’s goals may be admirable, its methods leave something to be desired.  At a minimum, OPR should recognize that facilitation of traffic flows represented in the LOS metric and reduction in the number of motor vehicles on streets and highways represented by the VMT metric may be identical with respect to the desired result of reducing emissions, and that there are more ways to reach those goals (e.g., re-striping, peak-period parking restrictions, improved traffic signal synchronization, all of which facilitate bus travel which is more available than fixed rail transit) than are, apparently, “dreamt of in [its] philosophy,” or set forth in its Update.  
Comments are due before October 10, 2014 at 5:00 p.m. and should be sent to Christopher Calfee, Senior Counsel, Governor’s Office of Planning and Research, 1400 10th Street, Sacramento, California 95814.

Appellate Court Grants Wide Discretion to Newhall Land and Farming Project Proponents in the Determination of the Significance of Greenhouse Gas Emissions Under CEQA

The California Court of Appeal last week reversed a lower court decision that would have indefinitely delayed the development by Newhall Land and Farming Company of 21,308 residential units, 629 acres of mixed use development, 67 acres of commercial use, 249 acres of business park, and 1,014 acres of open space in northwestern Los Angeles County over the next 25-30 years (“Project”).  The lower court’s decision had originally granted the Petition for Writ of Mandate brought by, among others, the Center for Biological Diversity (“Respondents”), challenging, among other actions by the California Department of Fish and Wildlife (“DFW”) (“Appellant”), the revised Joint Federal/State Environmental Impact Statement/Environmental Impact Report (“EIS/EIR”) for the Project.

While the Appellate Court’s 112 page decision addressed numerous causes of action brought by Respondents in the trial court, one of the most unique and far reaching was its disposition of Respondents’ claim that the EIS/EIR’s baseline for assessing the cumulative impacts of the Project’s Greenhouse Gas (“GHG”) emissions is a procedural issue properly evaluated under the “failure to proceed in a manner required by law” standard, applicable to procedural actions, and that, employing the correct standard, the EIS/EIR’s analysis was predicated on an illusory baseline.  In a decision that is likely to be adopted in the adjudication of other California Environmental Quality Act (“CEQA”) actions challenging the evolving state and federal GHG standards, the Appellate Court firmly disagreed. 

The Appellate Court held that “the determination of an environmental baseline for the existing conditions in a project area is largely factual in nature.”  Center for Biological Diversity, et al. v. Department of Fish and Wildlife, Court of Appeal of the State of California, Second Appellate District, Division Five, Case No. B245131 (Super. Ct. No. BS131347), March 2, 2014, p. 99, citing Neighbors for Smart Rail v. Exposition Metro Line Const. Authority, 57 Cal.4th 439, 449 (2013), and, thus, “an agency enjoys the discretion to decide, in the first instance, exactly how the existing physical conditions without the project can most realistically be measured, subject to review, as with all [CEQA] factual determinations, for support by substantial evidence.”  Id.   The Appellate Court then went on to find that the environmental baseline for the Project’s GHG emissions had been supported by substantial evidence in this case, where the Appellant adequately identified the amount of GHG emissions currently emanating from the Project site as the existing environmental setting, typically used as the baseline.  Id., citing CEQA Guidelines § 15125, subd. (a); Neighbors for Smart Rail, supra, 57 Cal.4th at 448. 

The Appellate Court went on to decide that the Appellant had properly declined to make a determination of the significance of the GHG emissions produced by the Project, even though the emissions were estimated in the EIS/EIR to exceed the baseline level of 10,272 metric tons per year by 259,000 metric tons per year, where the conditions without the Project’s environmental “efficiencies and strategies” were estimated to result in emissions totaling 390,046 metric tons per year.  The Appellate Court agreed with the Appellant that “the increase alone is not sufficient to support a significance determination because of the absence of scientific or factual information regarding when particular quantities of GHG emissions become significant (as climate change is a global issue).”  Center for Biological Diversity, supra, at 103.  The Appellate Court went on to find the Appellant “has discretion to select the significance criterion for [GHG] emissions,” Center for Biological Diversity, supra, at 105, citing CEQA Guidelines § 15064.4, subd. (a)], and to hold proper the Appellant’s significance criterion of choice, i.e., “[w]ill the proposed [project’s] [GHG] emissions impede compliance with the [GHG] emission reductions mandated in [the global warming act]?” 

In summary, the Appellate Court’s decision in this case lays the groundwork for future GHG analyses by leaving it up to the project proponent to choose, after providing evidence of the basis of its decision, both the criterion for the determination of significance and the definition of significance itself for GHG emissions, a very wide latitude for developers and other project proponents who now find themselves on the cutting edge of the interface between development and scientific analysis.

Legislature Asked to Grant CEQA Relief for Rail Projects

Following in the footsteps of his colleagues, on January 6, 2012, Assemblyman Mike Feuer introduced legislation that would give rail projects the same type of relief from California Environmental Quality Act (“CEQA”) requirements that were received in the last session by the proposed NFL stadium in Los Angeles, and some renewable energy projects. Notably, the CEQA amendments enacted for the NFL stadium include a very short time frame of 175 days for resolution of CEQA issues. While current CEQA litigation may extend to two years or more, depending on the complexity of the project and workload of the court, it stands to reason that issues surrounding local projects such as the stadium, with local traffic, noise and air quality impacts, may potentially be resolved within the 175 day timeframe. Rail projects are of far different scope, geographic extent, and are subject to a different set of laws.

Indeed, the geographic size of rail projects implicates the greater scope of legal applicability. Rail projects, even if, like the current “high speed rail,” limited to within the borders of California, will, of necessity, be recipients of Federal funding. Consequently, Federal environmental statutes, including the National Environmental Policy Act, 42 U.S.C. § 4321, et seq., and the Federal Clean Air Act, 42 U.S.C. § 7501, et seq., apply. Thus, while the California legislature may attenuate the CEQA process, the rail projects will still remain hostage to NEPA.

Finally, even if rail projects could proceed without Federal funding, which they most likely cannot, where they cross state lines, the Interstate Commerce Clause of the United States Constitution is implicated, and Federal law will apply. In short, to attenuate the environmental review process for major transportation projects will require a different legislative template, at a different legislative forum, the United States Congress.

CEQA and the Law of Unintended Consequences

On September 27, 2011, Governor Jerry Brown signed into law Senate Bill 292 and Assembly Bill 900, both of which are aimed at expediting, or “fast-tracking,” the litigation of lawsuits brought under the California Environmental Quality Act, 42 U.S.C. § 4321 (“CEQA”). SB292 is basically an earmark that will “fast-track” CEQA challenges to the Farmer’s Field National Football League Stadium proposed for downtown Los Angeles, next to the Los Angeles Convention Center and Staples Center, by requiring that such challenges be brought directly in California Courts of Appeals and be heard within 175 days. AB900 reaches more widely, “fast-tracking” all projects costing $100 million or more.

The stated intentions of the Bills’ sponsors are, on their faces, noble ones --- to provide more job opportunities, and spur increased spending and attendant tax revenue for the State, matters which seem urgent in light of the State of California’s economy. The problems raised by the Bills are less immediate, but no less important.

It’s fairly obvious that these two Bills drill large holes in CEQA’s blanket of protection of the public from the environmental impacts, both short and long term, of large scale development projects. It’s equally obvious that the Bills were intended to insulate not merely the stadium, but also other specific projects, such as the California High Speed Rail Project, from the usually lengthy CEQA process.

What is less obvious is that the Bills could also “fast-track” every airport improvement and/or expansion project in the State of California. This is because airport improvement projects are extremely costly, often involving reconfiguration of the airfield, including demolition and realignment of runways and taxiways, as well as terminal and parking lot construction. Even a small part of these potential activities could add up to hundreds of millions of dollars. So far so good you may be saying, because that type of major construction adds up to lots of jobs and better transportation.

This is where that nasty law of unintended consequences sneaks in. Along with the “good” of increased employment and capacity comes usually major, and always long term, environmental consequences on large swaths of numerous local communities. Such impacts include increased air pollution, greatly increased noise over the numerous residential communities located around airports, and the ubiquitous traffic impacts on local communities. Unlike the “fast-tracking” of the essentially local stadium project and of surface transportation projects which run in confined, proscribed corridors, airport impacts cover widespread and often unpredictable areas and populations.

It is true that access to the courts has merely been attenuated, not eliminated. But the impact of sending a challenge directly to the Courts of Appeals is draconian. The only path of reconsideration or appeal from a decision of a Court of Appeals is to the California Supreme Court. Because that court only accepts for hearing about 5% of the cases that apply to it, the new legislation effectively gives challengers only one bite at the apple. Thus, the Bills constitute a radical change in a state where Courts of Appeals regularly revised lower court decisions under CEQA.

Finally, and added to the already existing burdens on the Appellate Court system, the 175 day rule (or less than six months) to fully adjudicate a CEQA action further constrains the ability of the Appellate Courts, used to dealing with legal questions, to try what are usually highly fact specific and sometimes scientifically complex environmental issues.

In short, SB292 and AB900 are bad precedent, even if for good reasons. Special interest legislation is never desirable (although frighteningly common), and special interest legislation, the global consequences of which have not been fully considered, is even less desirable. It can only be hoped that environmental groups such as the National Resources Defense Council, which supported both Bills, will be just a quick to aide citizens affected by the legislation to adjust to their new legal reality.

Don't Procrastinate: Make Your Comments on Environmental Analyses Early and Often

Recent appellate cases have once again brought to the fore the critical importance of the “exhaustion of administrative remedies” for any potential challenger to an agency action based on noncompliance with the California Environmental Quality Act (“CEQA”), the National Environmental Policy Act (“NEPA”) and other laws meant to protect the environment and public.

In California, as example, public projects such as road construction, airport development, and power facilities, as well as private projects such as shopping centers are challenged on the basis of the failure to exhaust administrative remedies, or to present the alleged grounds of noncompliance “to the public agency orally or in writing . . . during the public comment period provided by this division or prior to the close of the public hearing . . .” Cal. Pub. Res. Code § 21177.

All too often, individuals, environmental organizations and public agencies wait to make their decisions to challenge the analysis of a project’s environmental impacts until their frustration peaks, and the time for filing a legal challenge arrives. [The usual time for filing a CEQA challenge is very short – 30 days from the filing by the agency of its Notice of Determination (“NOD”) which marks the final agency action in the CEQA process. NEPA is normally 60 days from the signing of the Record of Decision (“ROD”).] By that time, however, it is too late, because “exhaustion of administrative remedies is a jurisdictional prerequisite to maintenance of a CEQA action.” Bakersfield Citizens for Local Control v. City of Bakersfield, 124 Cal.App.4th 1184, 1199 (2004).

Moreover, simply articulating “generalized environmental comments at public hearings . . . [cites omitted]; relatively . . . bland and generalized references to environmental matters . . . [cites omitted]; . . . or isolated and unelaborated comments will not suffice.” Sierra Club v. City of Orange, 163 Cal.App.4th 523, 535-36 (2008). Instead, “the objections must be sufficiently specific so that the agency has the opportunity to evaluate and respond to them.” Id. Finally, “the petitioner bears the burden of demonstrating that the issues raised in the judicial proceeding were first raised at the administrative level.” Id. at 536.

Two recent California cases illustrate the ways in which two courts apply these strictures to arrive at diametrically opposing decisions. In Citizens for Responsible Equitable Environmental Development v. City of San Diego, 196 Cal.App.4th 515 (May 19, 2011), a citizens group challenged the Environmental Impact Report (“EIR”) for a residential development on the grounds that CEQA’s mandated Water Supply Assessment (“WSA”) was deficient. The court rejected the petitioners’ claim of having exhausted administrative remedies as a “perfunctory or skeleton showing . . .,” Id., at 528, where the petitioners rested their claim on: (1) a DVD submitted to the respondent city containing “thousands of documents,” Id., and (2) an accompanying letter referencing “evidence on water supply,” Id., but not specifically mentioning the word “drought.”

The court also rejected petitioners’ argument that they could rely on a statement by an unaffiliated party made at the public hearing that did reference “drought.” Even though “a petitioner may allege as a ground of noncompliance any objection that was presented by any person or entity during the administrative proceedings,” Id. quoting Bakersfield Citizens for Local Control, supra, 124 Cal.App.4th at 119, the court found that the testimony of a former councilman upon which the petitioners intended to rely was not specific enough, because, while petitioners claimed that the EIR’s analytic deficiencies required recirculation of a Supplemental Environmental Impact Report (“SEIR”), the councilman “never argued an EIR was necessary.” Citizens for Responsible Equitable Environmental Development, supra, 196 Cal.App.4th at 528. NEPA varies materially from CEQA on the issue of the required specificity of comments. Under NEPA, a would-be challenger must have raised the specific issue upon which it wishes to base its challenge during the administrative process.

Just one month later, another Appellate Court decided the issue differently, by relying on a variant of the exhaustion standard. In Santa Clarita Organization for Planning the Environment v. City of Santa Clarita, 197 Cal.App.4th 1042 (June, 2011), the court found that petitioner had adequately “papered the record,” even though the petitioner had not previously, among other lapses, provided explicit examples of the numerous mitigation measures it claimed in its challenge the city should have considered in the EIR’s analysis of the project’s global warming impacts. The court acknowledged that the petitioner had not been as specific as desirable. However, it found, despite some reservations about the petitioners’ alleged naiveté about CEQA’s procedural requirements, Id. at 1051, that “less specificity is required to preserve an issue for appeal in an administrative proceeding than in a judicial proceeding,” Id., quoting Citizens Association for Sensible Development of Bishop Area v. County of Inyo, 172 Cal.App.3d 151, 163 (1985). This was because “[parties] generally are not represented by counsel. To hold such parties to knowledge of the technical rules of evidence and to the penalty of waiver for failure to make a timely and specific objection would be unfair to them.” Citizens Association for Sensible Development of Bishop Area, supra, 172 Cal.App.3d at 163.

In short, courts can make radically disparate decision on the adequacy of exhaustion of administrative remedies, based on similar sets of facts and arguments. The solution is: (1) to engage an experienced attorney who can provide educated counsel concerning the issues in the environmental analysis most vulnerable to challenge; (2) to comment early and often on those and other issues, preferably starting with the Notice of Preparation of the Environmental Impact Report (“NOP”), including comments on the Draft Environmental Impact Report (“DEIR”), which is proforma, and ending only with the last document in the environmental analysis available for review, normally the Final Environmental Impact Report (“FEIR”); and (3) to make comments as technically specific as possible, even if this involves the expenditure for a technical consultant. It is only through those three steps that a would-be petitioner can successfully withstand the “exhaustion of administrative remedies” defense that is all but certain to arise in environmental litigation.

LAX/American Airlines Commuter Facility Project Avoids Environmental Review

Yet another project at Los Angeles International Airport (“LAX”) has skated under the requirements of the California Environmental Quality Act (“CEQA”). The project, the “American Airlines Commuter Facility Improvement Project,” allegedly constitutes a mere replacement of the facilities once occupied by United Airlines. Not exactly. The project actually includes, but is not limited to: (1) more than doubling the size of the passenger terminal/administration building to add passenger accommodations and office space; (2) addition of an almost 10,000 square foot building for baggage handling, office space and storage; and (3) replacement of a remote gate, accessed by foot or bus, with an enclosed contact gate such as those which are used inside the main terminals.

Despite the expansionary nature of the project, Los Angeles World Airports (“LAWA”), the Department of the owner, City of Los Angeles, responsible for operating LAX does not give so much as a passing nod to compliance with CEQA. If the project could simply be described as “new lease with American Airlines,” as a recent “Transmittal for Review of LAX Tenant Improvement Project” would have the public believe, the omission to conduct environmental review might be justified by a categorical exclusion from CEQA, 14 Cal. Code Regs. section 15301. That exclusion, however, does not apply here. The project, far from being “negligible” in scope, clearly constitutes a massive expansion of the previous passenger hold room and other passenger serving facilities.

This substantial enlargement of the passenger hold room and other accommodations has both capacity enhancing and cumulative impacts. In fact, its obvious purpose is to allow the accommodation of double the number of American Eagle passengers than could have been handled in the previous facility.

Finally, to add injury to insult, the approval of the project without environmental review also skirts around the settlement in City of El Segundo, et al. v. City of Los Angeles, et al., Riverside County Superior Court Case No. RIC426822. The gravamen of that settlement was limitation on capacity defined by number of passengers. Similarly, a “regionalization” provision was included and agreed to for the express purpose of working toward diversion of passengers to other airports. Increasing the size of the American Airlines Commuter Facility clearly increases “capacity” and, thus, is far from the negligible impact properly excused by a categorical exclusion.

In short, LAWA appears to be “piecemealing” the full scope of the redevelopment of LAX. If so, LAWA is in clear contravention of both California law and its contractual obligation under the Settlement Agreement with surrounding communities.

The California Supreme Court Clarifies Environmental Review Baselines Under the California Environmental Quality Act (CEQA)

The California Supreme Court recently weighed in on the critical issue of the proper baseline to be used in assessing the environmental impacts of a proposed project under the California Environmental Quality Act (CEQA). [Agencies must use a “baseline” from which to determine whether a project’s environmental effects will be “significant.”]  In Communities For a Better Environment v. South Coast Air Quality Management District, et al., 48 Cal. App. 4th 310 (2010), ConocoPhillips Company argued that the proper baseline for environmental analysis of a project at a petroleum refinery employing existing equipment should be the maximum permitted operating capacity of the equipment, even if the equipment is operating below those levels at the time the environmental analysis is commenced. The Court rejected that argument, holding that the baseline for CEQA analysis must be the “existing physical conditions in the effected area” (i.e., “real conditions on the ground”), rather than the level of development or activity that “could” or “should” have been present according to a plan or regulation. This confirms the California CEQA Guidelines requirement that the baseline consist of the physical environmental conditions in the vicinity of the project as they exist at the time the notice of preparation of the EIR is published or at the time the environmental analysis begins. 14 Cal. Code Regs. §15125(a).

The National Environmental Policy Act (NEPA) has similar requirements. NEPA also requires establishment of a baseline against which to compare the impacts of the proposed project. And, as with CEQA, the NEPA baseline usually consists of the pre-project environmental conditions. The Ninth Circuit Court of Appeals considered the baseline issue in American Rivers v. Federal Energy Regulatory Commission, 187 F.3d 1007 (9th Cir. 1999), where it held that use by the Federal Energy Regulatory Commission of existing environmental conditions at a hydroelectric power facility to evaluate a re-licensing proposal was the proper baseline, rather than a “theoretical reconstruction” of what the river basin would have been like if projects had never existed, as argued by several conservation and environmental organizations.

As shown in Communities For a Better Environment and American Rivers, project proponents often confuse “baseline” with the “no-action” alternative. Both CEQA and NEPA require that an EIR/EIS include an analysis of the environmental effects if the project is not approved or implemented, i.e., a “no action” alternative. However, the purpose of the no-action analysis is to compare alternatives, not to establish a baseline. The definition of the no-action alternative will vary depending on the nature of the proposed project. For some projects, the existing environment will not change if the project is not approved, and the no-action alternative and baseline will be the same. For other projects, rejection of the project will not preserve existing environmental conditions, and the no-action alternative will be different from the baseline.

Public agencies preparing environmental documents and agencies, organizations and others reviewing environmental documents should understand this important distinction between the environmental baseline and the no-action alternative.