Concerns Still Mount with CEQA Modernization Act

Senate President Pro Tem Darrell Steinberg’s SB 731, "The CEQA Modernization Act of 2013," continues to avoid meaningful reform say critics. Interestingly, Steinberg’s amendments to SB 731 have been in response to denigration from both the public/consumer side and the environmental/union sides of the CEQA debate.

Unfortunately, some feel the latest amendments to SB 731 still fall short, increasing opportunities for unwarranted project delays and frivolous CEQA lawsuits. (That infers unions and/or environmentalists would file frivolous lawsuits using CEQA as the basis just to stop a project? Oh, say it ain't so.)

Hence, this interpretation depends on whether you stand with those seeking to twist CEQA’s statutes to stop projects or those looking for meaningful reform to CEQA’s current overly burdensome regulations.

Key concerns with the latest amendments include the following:
(1) SB 731 adds a new impact area for consideration under CEQA, “economic dislocation,” potentially conflicting with existing law prohibiting consideration of purely socioeconomic impacts;
(2) SB 731 further increases CEQA review time and notice requirements; and,
(3) The bill requires the lead government agency to make publicly available an annual report on a project’s compliance with mitigation measures, upon request.

SB 731 adds a new impact area for consideration under CEQA, “economic dislocation,” potentially conflicting with existing law prohibiting consideration of purely socioeconomic impacts. Existing law prohibits consideration of a project’s economic and social impacts – though this aspect is commonly interjected by social equity and no growth groups. The only exception to consideration of a project’s economic and social impacts is where they would result in physical changes to the environment. As amended, SB 731 would overturn that prohibition. It directs the Governor’s Office of Planning and Research (OPR) to formulate recommendations to be incorporated in the CEQA Guidelines on how to evaluate, prevent and mitigate “economic displacement” impacts.

And where will this be felt most severely? Infill development; oddly giving NIMBYs, the Coastal Commission, BANANAs and others another tool to stop/delay projects or even remodeling of your home. The bill defines economic displacement as “the involuntary departure of residents and businesses from a community due to increased housing and rental costs attributable to specific private or public investments.”

The problem is, this new provision:
(A) Conflicts with existing CEQA law;
(B) Is internally inconsistent with other provisions in SB 731 that are designed to ENCOURAGE infill development;
(C) Will lead to additional regulatory hurdles and mitigation costs for new development designed to redevelop or improve otherwise blighted areas; and,
(D) Creates additional ambiguities in CEQA that will prolong the CEQA process and increase opportunities for litigation.

SB 731 also increases CEQA review time and notice requirements, providing additional opportunities to delay projects, and the bill requires the lead agency to make “findings” available to the public at least 10 days prior to their adoption and to provide public notice of the availability of the findings.

From a practical standpoint, this also could lead to additional litigation claims against a project. Any public comments on the findings will require responses from the lead agency because such comments are part of the administrative record -and- may be litigated in court. Furthermore, a project opponent could challenge in court the adequacy of subsequent changes to publicly circulated findings on the basis that they were not re-circulated. Clear as mud?

While SB 731 as originally drafted expressed an intent to prohibit or restrict these so-called “late hits” (that intent language was eliminated), this provision actually increases the opportunities for such inappropriate tactics. SB 731 requires the lead agency to prepare and make publicly available online an annual report on a project’s compliance with mitigation measures required in an approved mitigation monitoring and reporting plan (MMRP), if requested by a member of the public.

While previous versions of SB 731 required an annual report to be made available even absent a request by a member of the public, this latest amendment does very little to address the inherent problems associated with this provision. Opponents intent on abusing CEQA’s true aim to protect the environment will most certainly request a report in order to delay development projects already determined to be legally adequate under CEQA.

Ultimately, this provision will require heightened agency and public oversight of project implementation and ongoing CEQA compliance; provide additional opportunities for CEQA lawsuits, even where the report arguably identifies discrepancies with implementation of mitigation measures; and, impose additional annual costs to project proponents and the lead agency until all MMRP conditions are satisfied (some of which are ongoing operational conditions that technically are never “completed”).