Lead Opinion
Opinion
The California Environmental Quality Act (CEQA) (Pub. Resources Code, § 21000 et seq.)
The Court of Appeal invalidated the permit approval, relying on Guidelines section 15300.2, subdivision (c), which provides: “A categorical exemption shall not be used for an activity where there is a reasonable possibility that the activity will have a significant effect on the environment due to unusual circumstances.” In the Court of Appeal’s view, that a proposed activity may have a significant effect on the environment is itself an unusual circumstance that renders the categorical exemptions inapplicable. Finding substantial evidence of a fair argument that the proposed project may have a significant
We granted review to consider the proper interpretation and application of Guidelines section 15300.2, subdivision (c). We reverse the Court of Appeal’s decision.
I. Factual Background
Real parties in interest and respondents Mitchell’ Kapor and Freada Kapor-Klein (applicants) want to build a large house on their lot on Rose Street in Berkeley. The lot is on a steep slope (approximately 50 percent grade) in a heavily wooded area. In May 2009, their architect applied to the City for a use permit to demolish the existing house on the lot and to build a 6,478-square-foot house with an attached 3,394-square-foot 10-car garage. The residence would be built on two floors, would include an open-air lower level, and would cover about 16 percent of the lot.
In January 2010, the City’s zoning adjustments board (Board), after holding a public hearing and receiving comments about the project, approved the use permit. It found the project exempt from CEQA review under Guidelines sections 15303, subdivision (a), and 15332. The former, which the Secretary has designated Class 3, includes “construction and location of limited numbers of new, small facilities or structures,” including “[ojne single-family residence, or a second dwelling unit in a residential zone,” and “up to three single-family residences” “[i]n urbanized areas.” (Guidelines, § 15303, subd. (a).) The latter, which the Secretary has designated Class 32, applies to a project “characterized as in-fill development” meeting the following conditions: (1) it “is consistent with the applicable general plan designation and all applicable general plan policies as well as with applicable zoning designation and regulations”; (2) it “occurs within city limits on a project site of no more than five acres substantially surrounded by urban uses”; (3) its “site has no value as habitat for endangered, rare or threatened species” and “can be adequately served by all required utilities and public services”; and (4) its approval “would not result in any significant effects relating to traffic, noise, air quality, or water quality.” (Guidelines, § 15332.) The Board also found that Guidelines section 15300.2, subdivision (c), does not preclude use of these categorical еxemptions because the project as proposed and approved will not have any significant effects on the environment due to unusual circumstances.
Several residents of the City, including appellant Susan Nunes Fadley, filed an appeal with the city council, arguing in part that CEQA’s categorical
The city council received numerous letters and e-mails regarding the appeal, some in support and some in opposition. Among the appeal’s supporters was Lawrence Karp, an architect and geotechnical engineer. In a letter dated April 16, 2010, Karp stated (1) he had reviewed the architectural plans and topographical survey filed with the Board, and had visited the proposed construction site; (2) “[pjortions of the major fill for the project are shown to be placed on an existing slope inclined at about 42° (~l.lh:lv) to create a new slope more than 50° (~0.8h:lv)”; (3) “[tjhese slopes cannot be constructed by earthwork and all fill must be benched and keyed into the slope which is not shown in the sections or accounted for in the earthwork quantities. To accomplish elevations shown on the architectural рlans, shoring and major retaining walls not shown will have to be constructed resulting in much larger earthwork quantities than now expected”; (4) the “massive grading” necessary would involve “extensive trucking operations”; (5) the work that would be necessary “has never before been accomplished in the greater area of the project outside of reservoirs or construction on the University of California campus and Tilden Park”; (6) the project site is “located alongside the major trace of the Hayward fault and it is mapped within a state designated earthquake-induced landslide hazard zone”; and (7) “the project as proposed is likely to have very significant environmental impacts not only during construction but in service due to the probability of seismic lurching of the oversteepened side-hill fills.”
In a second letter addressing the investigation of geotechnical engineer Alan Kropp, Karp stated (1) no “fill slopes” were shown in Kropp’s plan and “the recommendations for retaining walls do not include lateral earth pressures for slopes with inclinations of more than 2h:lv (-27°) or for wall
In response, Kropp stated that the project site is in an area where an investigation is required to evaluate the potential for landslides, and that he had conducted the necessary investigation and found there is, in fact, no landslide hazard. Kropp also stated that, in raising concerns about “side-hill fill,” Karp had “misread[]” the project plans. According to Kropp, “the only fill placed by the downhill portion of the home will be backfill for backyard retaining walls and there will be no side-hill fill placed for the project. The current ground surface, along with the vеgetation, will be maintained on the downhill portion of the lot.” Because there will not, as Karp claimed, be any “steep, side-hill fill constructed,” Karp’s concerns do not apply to the proposed constmction. A civil engineer, Jim Toby, also submitted a letter stating that he saw “no evidence” in the project plans that fill will be placed “ ‘directly on steep slopes’ ” and that Karp’s contrary assertion is based on a “misreading” of the plans.
In support of the permit approval, the City’s director of planning and development submitted a supplemental report stating: “A geotechnical report was prepared and signed by a licensed Geotechnical Engineer and a Certified Engineering Geologist. This report concluded that the site was suitable for the proposed dwelling from a geotechnical standpoint and that no landslide risk was present at the site. Should this project proceed, the design of the dwelling will require site-specific engineering to obtain a building permit.”
The city council addressed the appeal at a meeting on April 27, 2010. Karp was one of the speakers at the meeting. He began by stating his credentials, explaining that he (1) is “a geotechnical engineer specializing in foundation engineering and construction”; (2) has “an earned doctorate degree in civil engineering and other degrees from U.C. Berkeley including two masters and a post-doctoral certificate in earthquake engineering”; (3) is “fully licensed” and had “taught foundational engineering at Berkeley for 14 years and at Stanford for three”; (4) has “experience” that “includes over 50 years of
Fadley then filed a petition for writ of mandate in the trial court, joined by appellant Berkeley Hillside Preservation, which is a self-described unincorporated association of “City residents and concerned citizens who enjoy and appreciate the Berkeley hills and their environs and desire to protect the City’s historic, cultural, architectural, and natural resources.” Following a hearing, the trial court denied the petition. It first concluded that the administrative record contains substantial evidence to support the City’s application of the Class 32 in-fill and Class 3 small structures categorical exemptions. It next found that Guidelines section 15300.2, subdivision (c), did not preclude application of these categorical exemptions because, notwithstanding evidence of potentially significant environmental effects, the proposed project does not present any unusual circumstances.
The Court of Appeal reversed. After noting appellants’ concession, for purposes of appeal, that the project satisfies the requirements of the Class 3 and Class 32 exemptions, the Court of Appeal agreed with appellants that the unusual circumstances exception precludes the City from relying on those exemptions.
We then granted respondents’ petition for review.
II. Discussion
As they did in the Court of Appeal, appellants concede for purposes of this appeal that the proposed project comes within the terms of the Class 3 (small structures) and Class 32 (in-fill development) exemptions under the Guidelines. What they do not concede is that the City may rely on those exemptions. In their view, as the Court of Appeal held, the unusual circumstances exception precludes such reliance. Respondents, in challenging the Court of Appeal’s decision, raise two primary arguments: (1) a proposed project’s potential significant effect on the environment is not, as the Court of Appeal held, itself an unusual circumstance that triggers the exception, and an unusual circumstance apart from the project’s potential environmental effect is a prerequisite to the exception’s application; and (2) in reviewing the City’s conclusion that the exception is inapplicable, the Court of Appeal should have determined whether there was substantial evidence in the record to support that conclusion, not whether the record contains evidence of a fair argument of a significant effect on the environment. To these arguments, we now turn.
A. A Potentially Significant Environmental Effect Is Not Alone Sufficient to Trigger the Unusual Circumstances Exception.
Generally, the rules that govern interpretation of statutes also govern interpretation of administrative regulations. (Guzman v. County of Monterey (2009)
Contrary to our rules for interpreting regulations, appellants’ proposed construction, which mirrors that of the Court of Appeal and which the concurring opinion would adopt, would give no meaning to the phrase “due to unusual circumstances.” According to appellants, this phrase is merely “descriptive” in that “[ujnusual circumstances” are simply “self-evident underpinnings” when a project that otherwise satisfies the requirements of a categorical exemption nevertheless “has potentially significant impacts.” Likewise, the concurring opinion asserts that “the phrase ‘unusual circumstances’ . . . simply describes the nature of a project that, while belonging to a class of projects that typically have no significant environmental effects, nonetheless may have such effects.” (Conc. opn., post, at p. 1123.) In other words, in the view of appellants and the concurring opinion, the phrase “due to unusual circumstances” adds nothing to the meaning of the regulation, and the exception applies if there is a fair argument that a project “may” (according to appellants) or “will” (according to the conc. opn., ibid.), have a significant environmental effect. However, had that been the Secretary’s intent, the phrase “due to unusual circumstances” would, no doubt, have been omitted from the regulation; rather than confuse the issue with meaningless language, the regulation would clearly and simply provide that the exception applies “if there is a reasonable possibility that the activity will have a significant effect on the environment.” Reading the phrase “due to unusual circumstances” out of the regulation, as appellants and the concurring opinion propose, would be contrary to the principle of construction that directs us to “accord meaning to every word and phrase in a regulation.” (Price v. Starbucks Corp. (2011)
In addition, we agree with respondents that, under -the construction of appellants and the concurring opinion, the categorical exemptions the Legislature, through the Secretary, has established would have little, if any, effect. CEQA specifies that environmental review through preparation of an EIR is required only “[i]f there is substantial evidence . . . that the project may have a significant effect on the environment.” (§ 21080, subd. (d).) As a corollary to this principle, CEQA also specifies that, if “[t]here is no substantial evidence, in light of the whole record before the lead agency, that the project may have a significant effect on the environment,” then the proposed project is not subject to further CEQA review. (§ 21080, subd. (c)(1).) Guidelines section 15061, subdivision (b)(3), is similar, specifying: “Where it can be seen with certainty that there is no possibility that the
Under these provisions, where there is no substantial evidence a proposed project may have a significant environmental effect, further CEQA review is unnecessary; no categorical exemption is necessary to establish that proposition. According to appellants, under the unusual circumstances exception, the categorical exemptions are inapplicable unless an agency “check[s] its files” and finds no “evidence of potentially significant impacts.” But this is similar to the inquiry an agency makes under Guidelines section 15061, subdivision (b)(3), to determine whether the proposed project is subject to CEQA review in the first instance. (Muzzy Ranch Co. v. Solano County Airport Land Use Com. (2007)
Appellants assert that applying a categorical exemption despite a proposed project’s potential significant environmental effect would contravene CEQA statutes and the Legislature’s intent in passing CEQA. They rely on three CEQA provisions: (1) section 21100, subdivision (a), which directs preparation of an EIR “on any project . . . that may have a significant effect on the environment”; (2) section 21151, subdivision (a), which similarly directs preparation of an EIR “on any project. . . which may have a significant effect on the environment”; and (3) section 21082.2, subdivision (d), which states that an EIR “shall” be prepared “[i]f there is substantial evidence, in light of the whole record before the lead agency, that a project may have a significant effect on the environment.” This statutory authority, appellants assert, “does not allow categorical exemptions for any project that may have a significant effect on the environment.” In other words, “the documented presence of a potential environmental effect . . . always defeat[s] a categorical exemption.” “[T]he statutory authority [the Legislature] has given to the Secretary only allows categorical exemption for projects that have no significant environmental effect, and ‘no statutory policy exists in favor of applying categorical exemptions where a fair argument can be made that a project will creаte a significant effect on the environment.’ ” Thus, appellants assert, requiring more than a showing that a proposed project may have a significant effect in the environment “would be inconsistent with” CEQA’s statutory “mandates.”
Appellants’ argument ignores a basic principle of statutory interpretation: courts “do not construe statutes in isolation, but rather read every statute
Here, several CEQA provisions, as well as their evolution, are relevant to the issue. When the Legislature enacted CEQA in 1970, it directed the Governor’s Office of Planning and Research (OPR), “in conjunction with appropriate state, regional, and local agencies,” to “coordinate the development of objectives, criteria, and procedures to assure the orderly preparation and evaluation of’ EIRs. (Former § 21103, added by Stats. 1970, ch. 1433, § 1, pp. 2780, 2782.) Two years later, in Friends of Mammoth v. Board of Supervisors (1972)
The Legislature immediately responded to Mammoth by amending CEQA through urgency legislation. (See County of Inyo v. Yorty (1973)
Collectively, these provisions indicate that the Legislature intended to establish by statute “classes of projects” that “have been determined not to have a significant effect on the environment,” to require the OPR and the Secretary to apply their expertise and identify those “classes” by “mak[ing] a finding” that the projects they comprise “do not have a significant effect on the environment,” and to “exempt” from CEQA proposed projects within the classes the OPR and the Secretary have identified. (§ 21084, subd. (a).) This conclusion comports with the impetus for the Legislature’s enactment of these provisions: our decision in Mammoth, which (1) observed that CEQA’s applicability turns on “questions of degree,” (2) stated that “the majority” of private projects “may be approved exactly as before” CEQA’s enactment because they “are minor in scope . . . and hence, in the absence of unusual
By contrast, as earlier explained, appellants’ construction of the unusual circumstances exception would render useless and unnecessary the statutes the Legislature passed to identify and make exempt classes of projects that have no significant environmental effect. Try as they might, appellants can identify no purpose or effect of the categorical exemption statutes if, as they assert, a showing of a fair argument of a potential environmental effect precludes application of all categorical exemptions. Construing the unusual circumstances exception to apply anytime there is a reasonable possibility of a significant environmental effect would, therefore, contravene our duty to adopt a construction that gives effect to all parts of the statutory and regulatory framework, rather than one that renders part of the framework “wholly useless and unnecessary.” (French Bank Case (1879)
The concurring opinion’s attempt to succeed where appellants have failed — i.e., to show that the categorical exemptions still have some “value” under their construction (Conc. opn., post, at p. 1128.)—is also unpersuasive. The concurring opinion first asserts that proposed projects enjoy “a considerable procedural advantage” when an agency finds that they fall within the terms of an exempt category. (Ibid.) As to such projects, the concurring opinion notes, an agency “need not follow any particular procedure,” “include any written determination,” “undertake an initial study, or adopt a negative declaration.” (Ibid) However, the same is true of proposed projects that fall within the terms of Guidelines section 15061, subdivision (b)(3), i.e., projects that are “not subject to CEQA” because “it can be seen with certainty that there is no possibility that [they] may have a significant effect on the environment . . . .” (See Muzzy Ranch, supra,
The concurring opinion also notes that, when an agency finds that a project meets the terms of a categorical exemption, it “impliedly finds that it has no significant environmental effect,” and “the burden shifts to” project opponents “to produce evidence” that the unusual circumstances exception applies. (Conc. opn., post, at p. 1128.) This is significant, the concurring opinion maintains, because “[i]n many cases, categorical exemptions are not litigated, and the applicability of the exemption is evident.” (Ibid.)
However, even if a proposed project faces no opposition, an agency invoking a categorical exemption may not simply ignore the unusual circumstances exception; it must “consider the issue of significant effects ... in determining whether the project is exempt from CEQA where there is some information or evidence in the record that the project might have a significant environmental effect.” (Association for Protection etc. Values v. City of Ukiah (1991)
Also illusory is the “second advantage” that, in the view of the concurring opinion, gives some value to categorical exemptions under its interpretation: the “comparative arguments” available to project proponents when an opponent invokes the unusual circumstances exception. (Conc. opn., post, at p. 1129.) According to the concurring opinion, proponents may “argue,” if “supported by evidence,” that (1) the project’s effects are “typical” of those generated by projects in the exempt category, “such that few or no projects in the category would be exempt if the effects were deemed significant,” and (2)
Moreover, contrary to the assertion of the concurring opinion, even were the categorical exemptions to retain some limited value under its construction, there would still be “reason[s]” (conc. opn., post, at p. 1131) to reject that construction. First, as earlier explained (ante, at p. 1097), because that construction would transform the phrase “due to unusual circumstances” into meaningless surplusage, it is one we “should avoid.” (Metcalf v. County of San Joaquin (2008)
Accordingly, the Court of Appeal erred by holding that a potentially significant environmental effect itself constitutes an unusual circumstance. In listing a class of projects as exempt, the Secretary has determined that the environmental changes typically associated with projects in that class are not significant effects within the meaning of CEQA, even though an argument
As to projects that meet the requirements of a categorical exemption, a party challenging the exemption has the burden of producing evidence supporting an exception. (Davidon Homes v. City of San Jose (1997)
This reading of the guideline is not inconsistent with the phrase “reasonable possibility that the activity will have a significant effect on the environment.” (Guidelines, § 15300.2, subd. (c).) A party invoking the exception may establish an unusual circumstance without evidence of an environmental effect, by showing that the project has some feature that distinguishes it from others in the exempt class, such as its size or location. In such a case, to render the exception applicable, the party need only show a reasonable possibility of a significant effect due to that unusual circumstance. Alternatively, under our reading of the guideline, a party may establish an unusual circumstance with evidence that the project will have a significant environmental effect. That evidence, if convincing, necessarily also establishes “a reasonable possibility that the activity will have a significant effect on the environment due to unusual circumstances.” (Guidelines, § 15300.2, subd. (c).)
As this discussion demonstrates, our approach is consistent with the concurring opinion’s statement of its central proposition: When it is shown “that a project otherwise covered by a categorical exemption will have a
Appellants assert that Wildlife Alive v. Chickering (1976)
After concluding in Chickering that the Commission’s activity did not fall within the language of the former guideline, we discussed why it would have been problematic to “expand[]” that “language to imply” an exemption for that activity. (Chickering, supra,
For several reasons, appellants’ reliance on Chickering is unavailing. First, Chickering predated the Secretary’s adoption of the unusual circumstances exception and, thus, addressed neither the meaning nor the validity of that exception. Second, as here relevant, the only issue in Chickering was whether the Commission’s activity fell within the scope of Guidelines former section 151071. After concluding it did not, we added the discussion appellants cite, which, to buttress our conclusion, explored the validity of a hypothetical exemption that would include the Commission’s activity. (Chickering, supra, 18 Cal.3d at pp. 205-206.) Third, because that added discussion was tangential to the issue before us and unnecessary to resolve the case, it was, understandably, summary. For example, it did not consider the broader statutory framework, the evolution of the CEQA statutes, or the implications of its statement for the effectiveness of various other CEQA statutes. Finally, in 1993, after we decided Chickering, the Legislature enacted section 21083.1, which directs courts “not [to] interpret [the CEQA statutes] or the state guidelines adopted pursuant to Section 21083 in a manner which imposes procedural or substantive requirements beyond those explicitly stated in [CEQA] or in the state guidelines.” (§ 21083.1, italics added.) According to the legislative history, the purpose of this statute was to “limit judicial expansion of CEQA requirements” and to “ ‘reduce the uncertainty and litigation risks facing local governments and project applicants by providing a “safe harbor” to local entities and developers who comply with the explicit requirements of thе law.’ ” (Assem. Com. on Natural Resources, Analysis of Sen. Bill No. 722 (1993-1994 Reg. Sess.) for hearing on July 12, 1993, p. 2.) Given appellants’ concession for purposes of appeal that the proposed project here falls within two of the categorical exemptions, under Guidelines section 15300.2, subdivision (c), environmental review is necessary only if “there is a reasonable possibility [the project] will have a significant effect on the environment due to unusual circumstances.” Given that the listing of a class of projects as exempt constitutes the Secretary’s finding, pursuant to the Legislature’s command, that the typical effects of projects within that class
As we have explained, “in the . . . years since CEQA was enacted the Legislature has, for reasons of policy, expressly exempted several categories of projects from environmental review. (See § 21080, subd. (b)(1)—[(15)].) This court does not sit in review of the Legislature’s wisdom in balancing these policies against the goal of environmental protection because, no matter how important its original purpose, CEQA remains a legislative act, subject to legislative limitation and legislative amendment.” (Napa Valley Wine Train, Inc. v. Public Utilities Com. (1990)
Appellants also substantially rely on this court’s decision in Mountain Lion Foundation v. Fish and Game Com. (1997)
For reasons similar to those earlier discussed in connection with Chickering, supra,
B. Standards of Review.
Several CEQA statutes expressly address judicial review of agency action. Section 21168 provides the standard of review for decisions “made as a result
The parties disagree about how these standards apply to an agency’s determination that the unusual circumstances exception is inapplicable. Respondents, invoking the traditional substantial evidence standard, argue that a reviewing court must uphold such a determination if substantial evidence supports it, even if substantial evidence in the record also shows that a contrary conclusion would be equally, or even more, reasonable. Appellants, on the other hand, contend that, even if substantial evidence supports the agency’s determination, a reviewing court must overturn the determination if there is a fair argument based on substantial evidence that the proposed project may have a significant effect on the environment due to unusual circumstances. A fair argument exists, appellants assert, “if any facts, fact-based assumptions, or expert opinion in the administrative record support . . . arguments that [the] exception may apply, regardless of contrary evidence.”
The fair argument approach derives from our application of section 21168.5 in No Oil, Inc. v. City of Los Angeles (1974)
The Natural Resources Agency has since expressly incorporated No Oil’s fair argument approach into the Guidelines. Guidelines section 15064, subdivision (f)(1), now states: “If the lead agency determines there is substantial evidence in the record that the project may have a significant effect on the environment, the lead agency shall prepare an EIR (Friends of B Street v. City of Hayward (1980)
The fair argument standard Guidelines section 15064, subdivision (f)(1), sets forth applies by its terms to determinations of a lead agency, not of a court. Under sections 21168 and 21168.5, judicial review of agency decisions is for abuse of discretion. (Laurel Heights II, supra, 6 Cal.4th at p. 1135.) The scope of review of an agency’s application of the fair argument standard is described in Friends of “B” Street v. City of Hayward, supra,
There have been several attempts to extend the fair argument standard to CEQA determinations other than the one at issue in No Oil, supra,
Several courts, however, have extended the fair argument approach to aspects of the determination whether the unusual circumstances exception applies. (Voices for Rural Living v. El Dorado Irrigation Dist. (2012)
We conclude that both prongs of section 21168.5’s abuse of discretion standard apply on review of an agency’s decision with respect to the unusual circumstances exception. The determination as to whether there are “unusual circumstances” (Guidelines, § 15300.2, subd. (c)) is reviewed under section 21168.5’s substantial evidence prong. However, an agency’s finding as to whether unusual circumstances give rise to “a reasonable possibility that the activity will have a significant effect on the environment” (Guidelines, § 15300.2, subd. (c)) is reviewed to determine whether the agency, in applying the fair argument standard, “proceeded in [the] manner required by law.” (§ 21168.5; Friends of “B” Street, supra,
Whether a particular project presents circumstances that are unusual for projects in an exempt class is an essentially factual inquiry, “ ‘founded “on the application of the fact-finding tribunal’s experience with the mainsprings of human conduct.” ’ ” (People v. Louis (1986)
As to whether there is “a reasonable possibility” that an unusual circumstance will produce “a significant effect on the environment” (Guidelines, § 15300.2, subd. (c)), a different approach is appropriate, both by the agency making the determination and by reviewing courts. As we explained in Laurel Heights II, supra, 6 Cal.4th at pages 1135, 1134, the fair argument standard “was derived from an interpretation of the language of, and policies underlying,” the statute at issue in No Oil—section 21151—which “commands that an EIR must be prepared whenever a project ‘may have a significant effect on the environment.’ ” (Italics omitted.) As the Court of Appeal observed in Banker’s Hill, supra,
This bifurcated approach to the questions of unusual circumstances and potentially significant effects comports with our construction of the unusual circumstances exception to require findings of both unusual circumstances and a potentially significant effect. It would be inappropriate for an agency to apply the fair argument standard to determine whether unusuаl circumstances exist. That standard is intended to guide the determination of whether a project has a potentially significant effect, not whether it presents unusual circumstances. While evidence of a significant effect may be offered to prove unusual circumstances, circumstances do not become unusual merely because a fair argument can be made that they might have a significant effect. Evidence that a project may have a significant effect is not alone enough to remove it from a class consisting of similar projects that the Secretary has found “do not have a significant effect on the environment.” (§ 21084, subd. (a), italics added; cf. Laurel Heights II, supra, 6 Cal.4th at p. 1134; No Oil, supra,
On the other hand, when unusual circumstances are established, the Secretary’s findings as to the typical environmental effects of projects in an exempt category no longer control. Because there has been no prior review of the effects of unusual circumstances, the policy considerations we discussed in No Oil apply. An agency must evaluate potential environmental effects under the fair argument standard, and judicial review is limited to determining whether the agency applied the standard “in [the] manner required by law.” (§21168.5.)
We reject respondents’ assertion that applying two different standards to the unusual circumstances exception is “fundamentally inconsistent with the legal framework for categorical exemptions” and would, by making the process “too complicated and cumbersome,” “defeat the Legislature’s intent in having categorical exemptions.” As explained above, requiring an agency to apply the fair argument standard to determine whether unusual circumstances give rise to “a reasonable possibility that the activity will have a significant effect on the environment” (Guidelines, § 15300.2, subd. (c)) is fully consistent with CEQA’s framework and the Legislature’s intent to provide categorical exemptions. Nor, for a reviewing court, is there anything particularly “complicated” or “cumbersome” about applying section 21168.5’s substantial evidence prong to unusual circumstance determinations, and its “proceeded in a manner required by law” prong to determinations as to potentially significant effects. Courts are well versed in bringing a variety of considerations to bear in making such determinations.
Contrary to respondents’ assertion, applying the fair argument standard to aspects of the unusual circumstances exception does not conflict with our decision in Muzzy Ranch, supra,
Finally, and again contrary to respondents’ assertion, our approach is fully consistent with — and is, indeed, affirmatively supported by — the decision in Valley Advocates v. City of Fresno (2008)
C. Lower Court Rulings.
In reviewing the City’s determination that the unusual circumstances exception does not apply, the trial court identified and made “two separate determinations”: (1) whether “there is a reasonable possibility that the activity will have a significant effect on the environment”; and (2) “whether such reasonable possibility of a significant effect is due to unusual circumstances associated with the project.” It answered the first question in the affirmative, explaining in part that, “[djespite Respondents’ criticisms of [Karp’s] report and [his] methodology, and even when discounting the clearly erroneous and misleading portions, Dr. Karp’s opinion” regarding the “ ‘probability of seismic lurching of oversteepened side-hill fills’ ” “provides substantial evidence of a fair argument of a significant environmental effect consequent to the Project.” However, the court also found that the proposed project did not
In reversing the judgment, the Court of Appeal agreed with the trial court “that Karp’s letters . . . amounted to substantial evidence of a fair argument that the proposed construction would result in significant environmental impacts.” But it disagreed that the unusual circumstances exception applies only if the proposed project’s potentially significant environmental effects are due to unusual circumstances. In the Cоurt of Appeal’s view, “the fact” that the proposed project “may” have a significant effect on the environment “is itself an unusual circumstance” that “preclude^]” the City from applying a categorical exemption. The Court of Appeal went on to note that it may nevertheless “be helpful” to determine “whether unusual circumstances exist” apart from the project’s potentially significant environmental effect. Considering this question de novo, it found that, with respect to the Class 3 small structure exemption, the proposed project’s size constitutes such a circumstance. In reaching this result, it reasoned that “whether a circumstance is unusual ‘is judged relative to the typical circumstances related to an otherwise typically exempt project,’ as opposed to the typical circumstances in one particular neighborhood.” As to the Class 32 in-fill development exemption, the court offered no additional analysis.
It is apparent that neither the trial court nor the Court of Appeal applied principles like those we have set out above. Remand for application of the standards we announce today is therefore both appropriate and necessary.
The Court of Appeal erred in another respect by indicating, as noted above, that the unusual circumstances inquiry excludes consideration of “the typical circumstances in one particular neighborhood.” In a number of decisions, our appellate courts have looked to conditions in the immediate
Respondents separately attack the conclusion of both the trial court and the Court of Appeal that Karp’s submissions constitute substantial evidence of a fair argument that the proposed project may have a significant environmental effect. As earlier noted, Karp opined that the proposed project “is likely to have very significant environmental impacts . . . due to the probability of seismic lurching of thе oversteepened side-hill fills.” Respondents contend that Karp’s opinion does not constitute substantial evidence of a fair argument because it is based on a misreading of the plans the City approved. In their view, the evidence in the record, including the submissions of Kropp and Toby, conclusively establishes that “the project approved by the City does not involve ‘side-hill fill’ ” and that Karp was mistaken in reading the plans otherwise. Because of Karp’s erroneous belief there would be side-hill fill, his opinion, respondents assert, “is not substantial evidence.” A finding of potential environmental impacts, respondents argue, must be based on the proposed project as actually approved, and may not be based on unapproved activities that opponents assert will be necessary because the project as approved cannot be built. If the proposed project “cannot be built as approved” and applicants want to build a different project, then “they must return to the City for approval of a different project and the City could issue a stop-work notice to prevent unauthorized construction.”
We agree with respondents that a finding of environmental impacts must be based on the proposed project as actually approved and may not be based on unapproved activities that opponents assert will be necessary because the project, as approved, cannot be built. In Laurel Heights I, supra,
We decline to extend Laurel Heights I to situations where project opponents claim, not that the proposed project will lead to additional future development, but that the proposed project cannot be carried out as approved and will require additional work that may or will have a significant environmental effect. The latter situation, unlike the former, presents little risk of either bureaucratic and financial impediments to proper environmental review or piecemeal review of a project with the potential for significant cumulative effects. As respondents argue, if a proposed project cannot be built as approved, then the project’s proponents will have to seek approval of any additional activities and, at that time, will have to address the potential environmental effects of those additional activities. As respondents also argue, if a project opponent’s opinion that unapproved activities may have a significant environmental effect constitutes fair argument, then it is doubtful that any project could survive challenge. Accordingly, Karp’s opinion is insufficient as a matter of law insofar as it is based on the potential effect of unapproved activities Karp believes will be necessary because the project cannot be built as approved.
This conclusion has implications for respondents’ claim that, because Karp misread the proposed project’s plans, his opinion is legally insufficient. As part of the permit application, applicants submitted a set of architectural plans
Finally, because reversal and remand is appropriate for reasons explained above, we need not resolve respondents’ claim that the remedy the Court of Appeal chose upon finding the proposed project not to be exempt under Class 3 or Class 32 — ordering preparation of an EIR — was improper. However, it is appropriate to discuss that issue because the question of remedy could arise again on remand.
Section 21168.9 specifically addresses the available remedies for CEQA violations. As here relevant', subdivision (a) provides that, upon finding that a public agency’s decision violates CEQA, a court should enter an order that includes (1) a mandate that the decision be voided in whole or in part, and/or (2) a mandate that the agency “take specific action as may be necessary to bring the . . . decision into compliance with” CEQA. (§ 21168.9, subd. (a)(1), (3).) Subdivision (b) states that any such order “shall be made by the issuance of a peremptory writ of mandate specifying what action by the public agency is necessary to comply with [CEQA].” (§ 21168.9, subd. (b),
Howevеr, as respondents note, subdivision (c) of section 21168.9 provides in part that “[njothing in this section authorizes a court to direct any public agency to exercise its discretion in any particular way.” In Voices, supra,
III. Disposition
The Court of Appeal’s judgment is reversed and the matter is remanded for further proceedings consistent with this opinion.
Cantil-Sakauye, C. J., Corrigan, J., Baxter, J.,
Notes
All further unlabeled statutory references are to the Public Resources Code.
The concurring opinion prefers to call Guidelines section 15300.2, subdivision (c), “the significant effect exception,” based on its title. (Conc. opn. of Liu, J., post, at p. 1126.) Our use of the term “unusual circumstances exception” is consistent with the Court of Appeal’s decision in this case and the vast majority of published case law. Of course, a provision’s title “is never allowed to enlarge or control the language in the body of the [provision].” (Hagar v. Sup. of Yolo Co. (1874)
Consistent with the preceding analysis, we disapprove Communities for a Better Environment v. California Resources Agency (2002)
We have previously observed that “the standard of review is essentially the same” under sections 21168 and 21168.5. (Laurel Heights Improvement Assn. v. Regents of University of California (1993)
This guideline first appeared in 1983 as Guidelines section 15064, subdivision (g)(1). (See Guidelines, § 15064, Register 83, No. 29 (July 16, 1983) p. 308.)
The courts noting judicial disagreement regarding the applicable standard also cite Dehne v. County of Santa Clara (1981)
In reversing based on potential geotechnical effects, the Court of Appeal did not address other potential effects appellants allege, including aesthetic and view impacts, inconsistencies with land use plans and policies the City has adopted for environmental protection, construction-related traffic impacts, and permanent traffic impacts related to contemplated fundraising activities at the house. Nor did the Court of Appeal address appellants’ argument that the City’s adoption of a traffic management plan is a mitigation measure that precludes a finding that the proposed project is categorically exempt. Rather than address these issues here in the first instance, we leave their consideration to the Court of Appeal on remand.
In its resolution affirming the Board’s decision, the city council stated: “[T]he Council hereby adopts ... the project plans on Exhibit B.” The page on which Karp relied does not appear in that exhibit.
Based on other expert evidence before the city council — the letters from Kropp and Toby — respondents also assert that Karp misread the omitted page, and that what he identified on that page as side-hill fill is actually nothing more than the lot’s current ground surface. In light of our conclusion, we need not address this argument.
Respondents also argue that “the probability of seismic lurching” Karp identified is an effect, not of the project, but of Berkeley’s “existing earthquake-prone environment,” and that application of the unusual circumstances exception may not be based on evidence of the existing environment’s impact on a proposed project. In California Building Industry Assn. v. Bay Area Air Quality Management Dist., review granted November 26, 2013, S213478, we granted review to decide whether CEQA requires an analysis of how existing environmental conditions will impact future residents or users of a proposed project. Given this fact, and the other errors that require reversal and remand, we do not address this claim.
Retired Associate Justice of the Supreme Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.
Administrative Presiding Justice of the Court of Appeal, Second Appellate District, Division Two, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.
Concurrence Opinion
Concurring. — I agree with today’s opinion that “a finding of environmental impacts must be based on the proposed project as actually approved and may not be based on unapproved activities that opponents assert will be necessary because the project, as approved, cannot be built.” (Maj. opn., ante, at p. 1119.) This rule will not lead to evasion of the environmental review requirements of the California Environmental Quality Act (CEQA; Pub. Resources Code, § 21000 et seq.) because presumably a
I do not agree, however, with the court’s reading of section 15300.2, subdivision (c) of the CEQA guidelines (Cal. Code Regs., tit. 14, § 15000 et seq. (Guidelines)) or with the court’s novel and unnecessarily complicated approach to the standard of review. Section 15300.2, subdivision (c) (hereafter section 15300.2(c)) provides that a categorical exemption from CEQA review shall not apply when “there is a reasonable possibility that the activity will have a significant effect on the environment, due to unusual circumstances.” The court says this language establishes two distinct requirements for section 15300.2(c)’s applicability: (1) there must be a reasonable possibility the project will have significant environmental effects and (2) those effects must be due to unusual circumstances. But, as explained below, a project falling within a categorical exemption is, by definition, a project belonging to a class of projects that does not have significant environmental effects. (See Pub. Resources Code, § 21084, subd. (a).) When there is a reasonable possibility that a project otherwise covered by a categorical exemption will have a significant environmental effect, it necessarily follows that the project presents unusual circumstances. In other words, the reasonable possibility of a significant environmental effect means that some circumstance of the project is not usual in comparison to the typical project in the exempt category. Instead of comprising a distinct requirement, the phrase “unusual circumstances” in section 15300.2(c) simply describes the nature of a project that, while belonging to a class of projects that typically have no significant environmental effects, nonetheless may have such effects. The sole question for courts reviewing agency determinations under section 15300.2(c) is whether substantial evidence supports a fair argument that the project will have significant environmental effects.
It is unfortunate that today’s opinion, instead of simplifying the law in accordance with the CEQA statute and Guidelines, adds further complexity to an area that many courts, practitioners, and citizens already find difficult to navigate. Nevertheless, I expect that after today’s decision, as before, courts reviewing agency determinations under section 15300.2(c) will be guided by
I.
The main purpose of environmental review under CEQA is to “identify the significant effects on the environment of a project” and to identify project alternatives and feasible mitigation measures. (Pub. Resources Code, § 21002.1, subd. (a); all statutory references are to this code unless otherwise indicated.) Consistent with that purpose, the Legislature created categorical exemptions and directed the Secretary of the Natural Resources Agency (the Secretary) to list classes of projects exempt from CEQA review. Section 21084, subdivision (a) (hereafter section 21084(a)) provides: “The guidelines prepared and adopted pursuant to Section 21083 shall include a list of classes of projects that have been determined not to have a significant effect on the environment and that shall be exempt from this division. In adopting the guidelines, the Secretary of the Natural Resources Agency shall make a finding that the listed classes of projects referred to in this section do not have a significant effect on the environment.” (Italics added.) Thus, section 21084(a) instructs the Secretary to exempt from CEQA review only classes of projects that do not have a significant effect on the environment.
The exempt classes of projects listed by the Secretary stand in contrast to statutory exemptions created by the Legislature. The latter include certain kinds of affordable housing (§ 21159.23), certain high priority transit projects (§ 21155.1), and the construction of certain prisons (§§ 21080.01, 21080.02). The statutory exemptions are not based on any determination that the exempt projects will not have significant environmental effects. Instead, they are based on the Legislature’s determination that each of the exemptions “promote[s] an interest important enough to justify forgoing the benefits of environmental review.” (Napa Valley Wine Train, Inc. v. Public Utilities Com. (1990)
The fact that a categorical exemption reflects a wholesale judgment about a class of projects, and not an individual judgment about a particular project, gives rise to the interpretive question before us. A class of projects “determined not to have a significant effect on the environment” (§ 21084(a)) — for example, a single-family residence — may turn out to be overinclusive insofar
One approach would be to say that section 21084(a) permits such overinclusion because most projects in an exempt class will not hаve significant environmental effects and the efficiency gains of exempting the entire class outweigh the value of requiring CEQA review of the few projects in the class that may have significant effects. But neither the court nor any party has advanced this theory, and for good reason.
In Wildlife Alive v. Chickering (1976)
Section 15300.2(c) reads in full: “Significant Effect. A categorical exemption shall not be used for an activity where there is a reasonable possibility that the activity will have a significant effect on the environment due to unusual circumstances.” This language is one of six provisions under the heading “Exceptions” in section 15300.2 of the Guidelines. Like section 15300.2(c), each of the other five provisions makes the categorical exemptions authorized by section 21084(a) inapplicable to projects that, while belonging to an exempt class, have certain characteristics that raise environmental concerns. (See §§ 15300.2, subd. (a) [exception for “a project . . . ordinarily insignificant in its impact on the environment [that] may in a particularly sensitive environment be significant”], 15300.2, subd. (b) [exception for “successive projects of the same type in the same place” whose “cumulative impact . . . over time is significant”], 15300.2, subd. (d)
This regulatory structure — categorical exemptions, with various exceptions to the exemptions — confirms that “a categorical exemption authorized by CEQA section 21084 is an exemption from CEQA for a class of projects that the Resources Agency determines will generally not have a significant effect on the environment.” (Communities for a Better Environment, supra,
In construing section 15300.2(c), it is worth noting that the title of the provision is “Significant Effect.” Hence I shall refer to section 15300.2(c) as the “significant effect exception.” In calling section 15300.2(c) the “unusual circumstances exception,” today’s opinion ignores the title and places primary emphasis on a term that the provision itself does not emphasize.
As the court acknowledges, the term “unusual circumstances” first appeared in the context of CEQA review in Friends of Mammoth v. Board of Supervisors (1972)
This understanding of “unusual circumstances” is restated in Communities for a Better Environment, supra,
In sum, when there is a reasonable possibility of a significant environmental effect from a project belonging to a class that generally does not have such effects, the project necessarily presents “unusual circumstances,” and section 15300.2(c) applies.
II.
Today’s opinion objects that this reading of section 15300.2(c) would result in categorically exempt projects being treated the same as nonexempt projects', thereby undermining the purpose of categorical exemptions. “Try as they might,” the court says, “appellants can identify no purpose or effect of the categorical exemption statutes if, as they assert, a showing of . . . potential environmental effect precludes application of all categorical exemptions.” (Maj. opn., ante, at p. 1102.) “[T]o establish the unusual circumstances exception, it is not enough for a challenger merely to provide substantial evidence that the project may have a significant effect on the environment, because that is the inquiry CEQA requires absent an exemption. (§ 21151.) Such a showing is inadequate to overcome the Secretary’s determination that the typical effects of a project within an exempt class are not significant for CEQA purposes.” {Id. at p. 1105.) The court is thus led to conclude that the term “due to unusual circumstances” sets forth a requirement separate and distinct from “a reasonable possibility [of] significant effect[s]” in section 15300.2(c). In turn, the court devises a novel “bifurcated” standard of review that evaluates whether there is a reasonable possibility of a significant environmental effect under the fair argument standard, while evaluating whether significant effects are due to unusual circumstances under a deferential substantial evidence standard. (Maj. opn., ante, at pp. 1115-1116.) This approach, the court suggests, is necessary in order to treat categorically exempt projects differently' from nonexempt projects and thereby realize the purpose of categorical exemptions.
First, when an agency has determined that a project falls within an exempt category, the project enjoys a considerable procedural advantage. For any project not covered by a categorical or other exemption, the reviewing agency has the burden of conducting an initial study into whether the project will have significant environmental effects. (See Guidelines, § 15063, subd. (a).) The project may proceed without further environmental review only if the agency issues a negative declaration identifying the project’s environmental effects and explaining why they are not significant. (See id., § 15063, subd. (b)(2); 1 Kostka & Zischke, supra, § 6.2, pp. 6-6 to 6-7 (rev. 3/14).) Notice and public review and comment are required of a negative declaration, and an agency must consider comments and potentially modify its conclusions in response to those comments. (See 1 Kostka & Zischke, supra, §§ 7.10, pp. 7-9 to 7-10, 7.19, pp. 7-16 to 7-17 (rev. 3/14).)
By contrast, an agency finding that a project falls into an exempt category need not follow any particular procedure nor include any written determination, and the agency need not undertake an initial study or adopt a negative declaration. (See 1 Kostka & Zischke, supra, § 5.114, pp. 5-100 to 5-101 (rev. 3/14).) When an agency finds that a project is subject to a categorical exemption, it impliedly finds that it has no significant environmental effect, and the burden shifts to the challengers of the proposed project to produce evidence that the project will have a significant effect. (Id. at § 5.71, pp. 5-61 to 5-62 (rev. 3/14), and cases cited therein.) Once an agency finds a project categorically exempt, it is the project opponent’s burden to produce evidence that the significant effect exception applies.
This procedural advantage should not be underestimated. In many cases, categorical exemptions are not litigated, and the applicability of the exemption is evident. In the mine-run of cases, the efficiency gains of sparing the agency the task of conducting an initial study and issuing a negative declaration provide a strong policy justification for categorical exemptions. Moreover, as is generally true of burden allocations in the law, in cases where an exemption’s applicability presents a close issue, requiring the challenger to show the reasonable possibility of a significant effect, instead of requiring the agency to show no such effects, can be determinative.
The court says this procedural advantage is “largely illusory” because “an agency may not apply a categorical exemption without considering evidence in its files of potentially significant effects, regardless of whether that
Moreover, an agency finding that a project falls into an exempt category confers a second advantage. As the court observes, the Secretary had to interpret the meaning of “significant effects” in order to identify classes of projects with no significant effects pursuant to section 21084(a). The Secretary’s designation of an exempt category reflects a judgment that projects in the category typically do not have significant environmental effects, and this judgment is entitled to considerable weight. When an opponent seeks to subject such a project to CEQA review, the proponent can make two comparative arguments (assuming they are supported by evidence) that are unavailable in the case of a nonexempt project. First, the proponent can argue that the project’s effects are typical of the effects generated by projects in the exempt category, such that few or no projects in the category would be exempt if the effects were deemed significant. Second, the proponent can argue that the project’s dimensions or features are not unusual compared to typical projects in the exempt category, thereby suggesting that the project is similar to those that the Secretary has determined not to have a significant environmental effect. The availability of these arguments shows that the phrase “ ‘due to unusual circumstances’ ” is not “meaningless surplusage.” (Maj. opn., ante, at p. 1104.) Such arguments make it more likely that a project belonging to an exempt category will be able to bypass the environmental review that would otherwise be required in the absence of any categorical exemption. (See, e.g., San Francisco Beautiful v. City and County of San Francisco (2014)
The court says this advantage is also “illusory” because “evidence a project proponent offers to show that the project will only have typical effects, dimensions, and features is irrelevant if a project opponent can make a mere fair argument that those effects, dimensions, or features are not typical, or
Today’s opinion also contends that under my reading of section 15300.2(c), a project proponent who claims a categorical exemption is in a “similar” position to the proponent of a nonexempt project who claims the commonsense exemption in Guidelines section 15061, subdivision (b)(3). (Maj. opn., ante, at pp. 1098-1099, 1102.) But the term “similar” is a fudge. The court says “similar” rather than “equivalent” because it does not and cannot deny that there is a difference between the commonsense exemption and the reasonable possibility standard. The commonsense exemption is available only when the agency, based on the record evidence, meets its burden of demonstrating “with certainty that there is no possibility that the activity in question may have a significant effect on the environment.” (Guidelines, § 15061, subd. (b)(3), italics added; see Muzzy Ranch Co. v. Solano County Airport Land Use Com. (2007)
Furthermore, an agency may find that a project falls within a categorical exemption without first making an express or definitive finding that no section 15300.2 exception applies; the burden is on the party challenging the categorical exemption to show that an exception applies. (Committee to Save the Hollywoodland Specific Plan v. City of Los Angeles (2008)
The court is thus mistaken that the categorical exemption statutes have “no purpose or effect ... if ... a showing of . . . potential environmental effect
Today’s decision ventures a panoply of reasons why Chickering should not be read to mean what it says, including the opaque contention that Chickering'& interpretation of section 21084(a) somehow violates “the Legislature’s express directive in section 21083.1 ‘not [to] interpret’ the CEQA statutes and the Guidelines ‘in a manner which imposes procedural or substantive requirements beyond those’ the statutes and the Guidelines ‘explicitly state[].’ ” (Maj. opn., ante, at p. 1108.) But the court’s reluctance to follow Chickering is ultimately based not on the language or legislative history of section 21084(a), but on the premise that reading section 21084(a) and section 15300.2(c) in harmony with Chickering would deprive categorical exemptions of any purpose or effect. Because this premise is flawed, so is the court’s haphazard effort to minimize Chickering’s simple and sensible reading of section 21084(a).
III.
It is true that over the years, the Courts of Appeal have divided on whether “unusual circumstances” and “significant effect[s]” are distinct requirements in section 15300.2(c). However, when one examines the reasoning of the many cases applying section 15300.2(c), it is clear that “unusual circumstances” and “significant effects” have invariably traveled together. In the nearly four decades since section 15300.2(c) was adopted, no published case has ever found or even hinted that a project that belongs to an exempt category yet has a reasonable possibility of significant environmental effects may nonetheless evade CEQA review on the ground that the effects are not
Indeed, most courts applying section 15300.2(c) have focused directly on whether there is a reasonable possibility that the project will have significant environmental effects. (See, e.g., North Coast Rivers Alliance v. Westlands Water Dist. (2014)
Among cases that have focused on “unusual circumstances,” it is evident that courts have treated unusual circumstances as a proxy for significant effects. In Wollmer v. City of Berkeley (2011)
As for the proper standard of review, many courts have held that the fair argument test applies. (Maj. opn., ante, at pp. 1113-1114 [citing cases].) One older case has disagreed, holding that section 15300.2(c) does not apply if there is substantial evidence supporting the agency’s conclusion that the project will not generate significant effects. (Centinela, supra,
Thus, courts have overwhelmingly used the fair argument standard in reviewing the applicability of the significant effect exception either because they believed it was the appropriate standard or because they assumed it was. For more than two decades, courts have not felt the need to resolve the question of the proper standard because the fair argument standard has proven adequate to the task of ferreting out bogus CEQA challenges that would subject categorically exempt projects to unnecessary environmental review. The ultimate touchstone of all of these courts’ inquiries has been whether there is a reasonable possibility that the project would have significant environmental effects.
Today’s opinion observes that “evidence that the project will have a significant effect does tend to prove that some circumstance of the project is unusual.” (Maj. opn., ante, at p. 1105.) This observation, though
Although I join the court in reversing and remanding for further proceedings, I would hold that the Court of Appeal did not err in its reading of section 15300.2(c).
Werdegar, J., concurred.
Appellants’ petition for a reahearing was denied May 20, 2015, and on May 27, 2015, the opinion was modified to read as printed above. Werdegar, J., and Liu, J., were of the opinion that the petition should be granted.