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In Berkeley Hillside Preservation v. City of Berkeley (2012) 203 Cal. App. 4th 656, the Berkeley Zoning Adjustment Board (Board) determined that a new roughly 10,000 square foot home in the Berkeley hills was categorically exempt from CEQA pursuant to (1) the Infill Development Exemption and (2) the New Construction / Conversion of a Small Structure Exemption. The Board also determined that none of the exceptions to the CEQA exemptions applied.

Petitioners filed an administrative appeal. During the administrative appeal, the city received a number of comment letters including two letters from a geotechnical engineer with over 50 years of experience concluding that the slope of the property, the need for massive grading, and the proximity to the Hayward fault established that the project would have very significant effects on the environment both during and after construction. Another geotechnical engineer disagreed with the above conclusions, and after allowing testimony from both engineers during the appeal hearing, the city council affirmed the decision to approve the use permits to construct the home. Thereafter, petitioners filed a petition for writ of mandate challenging the city’s approval of the use permits.

On appeal from the trial court ruling upholding the city’s actions, petitioners conceded that the project is subject to the two CEQA categorical exemptions asserted by the city. Petitioners argued, however, that the “unusual circumstances” exception to the exemptions applied and prevented the city from relying on the exemptions. The court agreed, holding that “a categorical exemption does not apply where there is any reasonable possibility that proposed activity may have a significant effect on the environment.” The “unusual circumstances” exception can apply to a project that is not unusual; the existence of substantial evidence supporting a fair argument that a project normally exempt from CEQA may result in a significant environmental impact is itself an “unusual circumstance” prohibiting use of a categorical exemption. Nevertheless, the court stated that it may be helpful to first analyze whether the project is unusual in considering whether the “unusual circumstances” exception applies to a project.

Relying on the “fair argument” test, the court concluded that the administrative record included substantial evidence supporting a fair argument that the project is both unusual and would result in significant environmental impacts. With respect to the project’s unusual nature, the court explained that petitioners demonstrated that the home would be one of the largest in the entire city. As a matter of law, the 10,000-square-foot home was unusual “because the circumstances of the project differ from the general circumstances of projects covered by the single-family residence exemption…” Next, the court found a reasonable possibility that the proposed construction will have a significant effect on the environment due to the unusual size to the project. Although the court acknowledged that a disagreement existed between geotechnical engineers, the court held that “contrary evidence is not adequate to support a decision to dispense with an EIR.” (Original emphasis.) The court, therefore, reversed the trial court’s judgment and ordered the lower court to issue a writ of mandate directing the city to prepare an EIR.

Key Points:

For a lead agency to rely on a categorical exemption in the face of opposition, the lead agency must determine that evidence in the record does not support a “fair argument” that the project may result in one or more significant environmental impacts. If such evidence can be found in the record, then the “unusual circumstances” exception applies and use of a CEQA exemption is improper. This case represents a shift from previous case law requiring a showing of substantial evidence to support an argument that unusual circumstances exist.
Additionally, in holding that the project’s “proximity to a fault” was evidence of an unusual circumstance, the opinion is inconsistent with Ballona Wetlands Trust v. City of Los Angeles (2011) 201 Cal.App.4th 455. In Ballona Wetlands, the Court held that CEQA requires consideration of a project’s impacts on the environment and not consideration of the environment’s impact on a project (e.g. such as sea level rise or fault impacts on a project). Moreover, if “proximity to a fault” disqualifies a project from relying on CEQA exemptions, like the in-fill exemption, then most of the Bay Area will, as a practical matter, be unable to rely on CEQA exemptions for any projects.

Written By: Tina Thomas and Chris Butcher

For questions relating to this blog post or any other California land use, environmental and/or planning issues contact Thomas Law Group at (916) 287-9292.

The information presented in this article should not be construed to be formal legal advice by Thomas Law Group, nor the formation of a lawyer/client relationship. Readers are encouraged to seek independent counsel for advice regarding their individual legal issues.

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