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. 
 


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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).
 
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The Ninth Circuit Court of Appeals recently clarified the proper approach to be applied in analyzing the economic impacts of designating critical habitats for endangered or threatened species under the Endangered Species Act (ESA). In Arizona Cattle Growers’ Association v. Salazar, the Court found that the U.S. Fish and Wildlife Service (FWS) properly applied a "baseline" approach in designating approximately 8.6 million acres of Federal land as critical habitat for the Mexican Spotted Owl. The Court also found that the FSW properly interpreted “occupied” as including not only areas where owls are found, but areas where owls are likely to be present as well. See, previous blog dated June 21, 2010.

A decision to list a species as endangered or threatened is made without reference to the economic effects of the decision. In contrast, an agency must consider the economic impacts of designating critical habitat in any particular area. Under the baseline approach used by the FWS, any economic impacts of protecting a species that will occur regardless of the critical habitat designation, such the economic impacts imposed by listing the species, are treated as part of the regulatory “baseline” and are not factored into the economic analysis of effects of the critical habitat designation.


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In a recent case, Arizona Cattle Growers Association v. Salazar, the Ninth Circuit Court of Appeals upheld a designation by the U.S. Fish and Wildlife Service of approximately 8.6 million acres of Federal land as critical habitat for the Mexican Spotted Owl, a threatened species under the Endangered Species Act (“ESA”). In making the designation, FWS interpreted the word “occupied” in the ESA’s critical habitat provision to include not only areas where owls are found, but areas where owls are likely to be present as well.


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