1994 CEQA Update: New Provisions, New Case Law

The new year has brought with it some changes to the California Environmental Quality Act (CEQA). Most of these changes come from several CEQA revision bills passed in the 1993 legislative session and signed by Governor Wilson, effective on January 1, 1994. In addition, in the first week of January, the Supreme Court handed down a new decision in the endless Laurel Heights case which clarifies the standard for recirculation of final Environmental Impact Reports (EIRs). 

The 1993 legislative CEQA revisions make numerous changes to CEQA, mostly intended to eliminate duplication and achieve streamlining. The thrust of the legislation was a balanced approach to streamlining the CEQA process. Neither development interests nor the environmentalists "won" and compromises were made on both sides. 

The amendments now prohibit agencies from requiring proof of CEQA compliance in order to determine that a permit application is complete. This will require concurrent permit processing and will speed up the entitlement process. The new law also puts limits on the time for a consultant contract to be executed. In those jurisdictions that require third-party contracts for EIR consultants, the consultant contract must be executed within 45 days of accepting an application as complete. This will eliminate the delays caused by the consultant selection process in many jurisdictions. 

The CEQA amendments now expressly authorize the use of mitigated Negative Declarations. This is a cleanup measure putting into the code that process which is already widely utilized. The amendments also try to clarify the standard to determine whether to prepare a negative Declaration or an EIR. Now, a Negative Declaration must be prepared when there is no substantial evidence "in light of the full record” that the project may have a significant effect on the environment. The proponents of this amendment are hoping that the courts will interpret the new "in light of the whole record" language to allow more balancing of the evidence and prevent the requirement for EIR preparation based on its insubstantial evidence offered by opponents of the project at an early stage. 

The new legislation specifically authorizes the use of Master EIRs for general plans, specific plans, phased projects, redevelopment projects and regional regulations. Projects implemented within five years of the Master EIR will need no further CEQA compliance if found to be within the scope of that document. This provision puts into law a procedure now utilized, but the consequences of which are often in dispute. Specific procedures are now outlined. 

The amendments contain a specific provision which require that the cumulative impact analysis in an EIR need only include those projects known before the draft EIR is released. This will eliminate the necessity for constantly updating the cu­mulative analysis during the processing of the project. However, the provision requires that the final EIR must be certified within 150 days after the close of the public comment period. Further delays will require updating of the cumulative analysis if necessary. 

The amendments provide for an optional expanded Notice of Preparation and encourage public involvement in the scoping of the EIR. The amendments also require that the public notice of a draft EIR or Negative Declaration must now list all significant impacts and list where referenced documents are located. This requirement could be unwieldy con­sidering that some projects will have lengthy lists of references and many impacts. 

Several of the amendments are directed at judicial review of EIRs. A provision has been added that specifies that the Legislature's intent is that the courts should not interpret the CEQA to add new substantive and procedural requirements beyond those explicitly stared in the statute or the Guidelines. Courts are also allowed to permit projects to proceed despite CEQA violations where proceeding with a portion of the project will not prejudice consideration of further mitigation measures or alternatives. These provisions will help courts slay out of the legislative arena and strictly interpret CEQA's provisions. They will also allow courts to allow projects to proceed at the same time CEQA defects are being corrected, reducing the use of the CEQA lawsuits as a delaying tactic. 

It is anticipated that 1994 will see another round of CEQA proposals. In addition to the bills that were enacted, Governor Wilson vetoed one of the major 1993 CEQA bills. That bill included provisions which would limit the definition of a project under CEQA to actions that have direct physical impacts; create a new statutory exemption for affordable housing; allow modification of measures in mitigated Negative Declarations without recirculation; and specify the contents of the administrative record for CEQA's litigation. These issues will be reintroduced in 1994. Both business and environmental groups also have their own proposals which will be reintroduced in 1994. Business groups are seeking statutory exemptions for existing facilities requiring permit renewals; shortened time limits for CEQA; and further limitations on judicial review. Environmental groups have proposed prohibition of applicant-sponsored EIRs and standing for citizen lawsuits to enforce mitigation measures. 

In the first week of January, 1994, a new decision by the Supreme Court was published in Laurel Heights vs Regents of the University of California. This decision is the latest in a series of cases regarding an attempt by the University of California to conduct bio­medical research at its UCSF facility. The original EIR for the project had been found inadequate by the Supreme Court in 1988. The university then produced a new six volume EIR, which was again challenged by project neighbors. In l992, the Court of Appeal found that two issues in the new final EIR required recirculation due to the inclusion of new information. 

The Supreme Court reversed that decision, finding that the new information in the final EIR did not rise to the level that requires recirculation. In so ruling, they articulated a standard to be applied to the decision whether to recirculate. CEQA states that the final EIR must be recirculated if it includes “significant new information." The Court was called upon to define what "significant" means in this context. The Court determined that the addition of new information to an EIR after the close of public comment is not "significant" unless the EIR is changed in a way that deprives the public of a meaningful opportunity to comment upon a substantial adverse environmental effect of the projector anew feasible way to mitigate or avoid such an effect that the project proponents have declined to implement. This case narrows previous views of when recirculation may be required and provides guidance to applicants and cities in their decisions to recirculate.