Hernandez: San Francisco VMT Implementation Avoids CEQA Litigation Unlike Potential OPR Reform

This month, San Francisco adopted the Vehicle Miles Traveled metric in place of Level of Service for all CEQA determinations. Tell us about the significance of this action in the context of statewide implementation of SB 743.

Jennifer Hernandez: I think it’s a terrific step forward by San Francisco, which, in many ways, has tried to lead the way on CEQA.

We ended up with LOS in CEQA based primarily on the air-quality emissions of cars idling in traffic for longer periods than they would if they could simply move through more quickly. Some of that early case law in CEQA was made in San Francisco and resulted in both parking and LOS becoming CEQA impacts.

San Francisco’s action has brought us full circle to the question: How should communities use CEQA to advance greenhouse-gas goals, and how does CEQA need to be changed to make sure it doesn’t impede those and other environmental goals?

It’s terrific that San Francisco is ahead of SB 743. The Legislature only delegated to OPR the role of adopting a new transportation metric in CEQA for Transit Priority Areas (TPAs). San Francisco is a very transit-oriented city and has, as a policy matter, long ago decided to prioritize automobile travel as a CEQA mitigation measure.  

Elaborate on the significance of San Francisco moving before OPR on this matter. 

CEQA has always allowed lead agencies to identify their own thresholds for when an impact is significant, as long as the lead agency’s decision is supported by substantial evidence.

Like much of CEQA, this lead agency threshold issue has at times been a litigious issue, especially when married to the “fair argument” standard in CEQA for review of Negative Declarations. For example, in a couple well known cases, cities or counties attempted to say, “Our threshold of significance under CEQA for noise impact is compliance with our adopted noise standards. If you comply with our adopted noise standards, your noise is not significant for CEQA purposes.”

Courts have been mixed in how much deference they give to those kinds of agency decisions. Just this past summer, a San Francisco appellate court decided that compliance with a county noise ordinance was insufficiently protective under the “fair argument” standard, and inappropriate as a threshold of significance under CEQA, so the court required an EIR instead of a Negative Declaration for that project.  CEQA lawsuits can and do challenge adopted significance thresholds.

It was a major step forward when the Legislature in SB 743 said, “We’re going to take out aesthetics and parking from CEQA in Transit Priority Areas for designated types of projects.” It was a very tricky question as to what the Legislature has authorized OPR to do in coming up with alternative thresholds for transportation metrics. But this was a statutory delegation just to OPR—not to other agencies—by the Legislature.  San Francisco is using pre-SB 743 CEQA authority, although its proposal is certainly aligned with the recent Governor’s Office of Planning and Research (OPR) proposal.

In January, OPR released its second draft of new CEQA guidelines to implement SB 743. Can you comment on these updates, and how San Francisco’s actions fit in?

The guidelines update proposal issued by OPR is very complicated and multi-pronged. It doesn’t just deal with VMT. It also requires new analyses of “induced traffic” and demands a “road diet” to meet Executive Order greenhouse-gas reduction goals—but doesn’t reconcile congestion-reduction mandates in other statutes. It also creates new ambiguity about when a VMT impact is “significant” for many categories of projects—like schools and hotels and ports.  It is a lot more complicated than the San Francisco VMT threshold, and would apply statewide to an incredibly diverse array of communities throughout the state.

San Francisco is a transit-oriented community. It always has been. It was built out before the car. It’s always had multiple regional and local transit systems. It’s therefore a great community to move away from congestion as a CEQA impact. I really hope the courts will agree to abide by the city’s new VMT threshold. I will strongly defend the city’s position.

But look at it this way. Let’s call Yosemite National Park a project area. Do you want a lot of cars moving easily through Yosemite National Park on the 4th of July weekend? Do you want to create a network of highways through it? Of course not. It’s the most ludicrous, and in fact, offensive idea imaginable to someone who loves that park, as I do.

Some places, whether it’s San Francisco or Yosemite National Park, are, by design, attempting something different than allowing cars free access. When communities are set up to be less car-centric, CEQA shouldn’t require a car-centric impact approach.

To the extent that both the OPR proposal and the city proposal are attempting to create a non-car-centric option for evaluating impacts under CEQA, help greenhouse-gas reduction, and promote walkability and other community values, I think they’re great. I think there should be more optionality in CEQA to reflect community design choices. So did Governor Brown. When he was mayor, he chastised the Supreme Court in an unsuccessful effort to get an appellate court decision invalidating an infill housing project’s CEQA compliance on aesthetic grounds.  As the then-mayor (and infill supporter) told the Supreme Court:  “These are community design values. They are not matters for environmental law or, frankly, judges.” 

You seem not to be quibbling with the goals of VMT, but saying that OPR’s use of the term is too complicated in terms of legal ramifications when the program is implemented. Elaborate on the word “complicated.”

Staying with the VMT portion of the OPR proposal: The most disappointing part is that it just creates the “presumption” that only some kinds of projects inside transit priority areas are less significant from a CEQA perspective.

OPR could, and in my judgment, should, have taken the Legislature’s delegation much more seriously. It should have simply agreed, based on a lot of existing data developed under SB 375, that VMT is lower in transit priority areas. Therefore, VMT would be a fine metric to use in transit priority areas, and projects in TPAs have a less-than-significant VMT impact under CEQA absent unusual circumstances. We can then fight about unusual circumstances. But OPR could and should have created a clear, unambiguous pathway for avoiding VMT methodology fights in transit priority areas. It chose not to do that. 

Elaborate on what that fight would be about, and its cost.

OPR has suggested that for commercial and residential projects, a good marker for less-than-significant VMT is 15 percent below the city’s average. This applies to transit priority areas.

OPR does not say anything at all about the many other urban uses frequently targeted by CEQA lawsuits: schools, parks, hospitals, universities, hotels, airports, and entertainment venues—just to name a few. There’s no direction in the OPR “reduction” approach or the 15-percent signpost for residential and commercial about how to apply this VMT metric to the many other kinds of land uses that the OPR proposal simply doesn’t address. When you create that kind of gap in direction, you get a technical and litigation free-for-all.

Consider whether a hospital’s VMT is or isn’t significant. If it’s a regional trauma center, and brings people in from all over, is that a worse hospital than a neighborhood-serving hospital that only brings people in from the immediate neighborhood? What is a college supposed to do with VMT when it decides to expand its enrollment or build a first-class research center drawing scholars from throughout the world? Does the college first have to enroll people who are already in the neighborhood, or focus its research only on issues of interest to neighboring scholars? To me, those are ludicrous ideas.

CEQA, as far as I can tell, is the absolute most unpredictable administrative law in the country, with 43 percent of EIRs and 58 percent of negative declarations falling in contested, reported appellate cases over a 15-year period. With that kind of track record, we will have a free-for-all for some of our most critical urban uses.

I think it is even more unfortunate because we are stressed, after many years of discussion, with inadequate urban services. As communities finally get a little money to do some upgrades and try to serve existing residents in a more effective way—let alone serve projected new growth—with better libraries, schools, and transit, we’re now off to the races with a brand new litigation target called VMT, with poor direction from OPR about how to apply it.

What do those who support OPR developing this new standard not understand about your argument?

I don’t know, because the process to date has been a lot of talking at people. There hasn’t been much honest give-and-take.

There have been many meetings with OPR, don’t get me wrong. But OPR got about 200 comment letters on its first discussion draft, and the second discussion draft chooses to summarize 11 partial comments from those 200 letters. That’s not much of a dialogue.

I do think that they could and should have done much more than a presumption of no VMT or not-significant VMT in TPAs. The Legislature gave them that authority and they didn’t use it.  And we should road-test VMT as a CEQA impact in TPAs, as the Legislature directed, and then use that experience to consider—later—any proposal to impose a new CEQA VMT mandate outside of TPAs.

To close, TPR excerpted the Holland & Knight study that found widespread abuse in CEQA by non-environmentalists. Can you put the VMT/LOS debate in the context of necessary CEQA reform?

Typically, if you want to get an outcome in government, a very effective way to do that is to make clear what you want. If you want to collect taxes, your tax code better be clear. The more complicated it gets, and the more exceptions and loopholes, the harder and more expensive it is to work with. But at the end of the day, the IRS wants to collect the taxes that it believes it is owed.

CEQA is very different. Other environmental laws, like the Clean Water Act and other statutory frameworks, provide greater certainty in terms of what’s required to comply with applicable standards and mandates. CEQA has maintained this very loose construct of when an impact is significant, and what an impact even is. Just this past year, the Supreme Court looked at decades’ worth of practice and case law about whether CEQA applies to the environment’s impacts on a project. It issued a pretty confusing decision that said CEQA does not apply to the environment’s impacts on a project, unless the project somehow exacerbates those impacts. That turned years and years of seismic impact CEQA decisions—just to name one of the scores of CEQA “impact” topics—on their head. It’s an unpredictable law.

Absent the kind of certainty I called for above, we all expect this new requirement to work the same way under CEQA as greenhouse gas has: vague standards put out by OPR, followed by decades (we’re into our second decade now) of attempts by the hundreds of lead agencies, thousands of CEQA professionals, and scores of judges, to create clarity about what’s actually required. That’s unfortunate. Climate is much too urgent a priority to allow 20 years of bumbling around to try to increase density in TPAs, because that’s the right thing to do.