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In Habitat and Watershed Caretakers v. City of Santa Cruz (2012) Cal.App. LEXIS 1213, the Sixth District Court of Appeal reversed a trial court decision and ordered that certification of an environmental impact report (EIR) prepared by the City of Santa Cruz be vacated pending the City’s correction of defects in the identification of project objectives and the analysis of alternatives.

In 2006, the Regents of the University of California (Regents) adopted a Long Range Development Plan (LRDP) for the University of California, Santa Cruz, which contemplated development of “North Campus” in an unincorporated area outside of the City of Santa Cruz. The city and others filed a lawsuit challenging the Regents’ approval of the LRDP, and in 2008, the Regents and City entered into a settlement agreement pursuant to which the Regents agreed to restrict enrollment and increase on-campus housing, contingent on the city seeking approval from the Local Agency Formation Commission (LAFCO) for a sphere of influence (SOI) amendment to bring North Campus within the city, and agreeing not to oppose the Regents’ request for extraterritorial water and sewer services for North Campus. The city subsequently filed an application for an SOI amendment with LAFCO, and the Regents filed an application for the provision of water and sewer services. The city prepared an EIR for the project, which it certified in August, 2010. Petitioners filed suit alleging that the EIR failed to comply with the California Environmental Quality Act (CEQA).

The trial court denied the petition; however, on appeal, the court concluded that the city’s EIR incorrectly described the project’s objectives and that this incorrect description skewed its consideration of alternatives. The EIR was therefore inadequate because it failed to consider any potentially feasible alternatives that would avoid or limit the significant environmental impact of the project on the city’s water supply.

The EIR described the objectives as implementation of the settlement agreement as related to submission of applications to LAFCO for an SOI amendment and to facilitate the provision of water and sewer service. The court found that these objectives did not describe the underlying purpose of the project, but only the nature of the project. In other words, the purpose of the project was not to fulfill the settlement agreement requirements, since those were satisfied when the applications were filed. The SOI amendment and provision of water described the project, but the underlying purpose inferred from the EIR was to provide the Regents with the water necessary to develop North Campus and the other to satisfy the requirements necessary to trigger the Regents’ obligation to honor its commitments in the settlement agreement for provision of on-campus housing. The court therefore agreed with petitioners that the EIR misstated the project’s objectives.

The court went on to find that this skewed the consideration of alternatives The EIR did not include consideration of alternatives, such as a reduced-development or limited-water alternative, that could avoid or lessen significant impacts on water supply based on the city’s position that these alternatives failed to meet the basic project objectives. The court found that either of these alternatives would at least partially met the project’s underlying purpose of allowing some development of North Campus and neither would fail to secure the city’s ability to hold the Regents to their housing commitment. Because the EIR did not provide any analysis of feasible alternatives, the EIR failed to satisfy the informational purposes of CEQA.

The court also considered arguments from petitioners related to the analysis of impacts on water supply, watershed resources, biological resources, and indirect growth inducement, but deferred to the conclusions of the city on these points, which were supported by substantial evidence.

Key Point:

The court’s decision serves as a reminder that the lead agency should carefully describe the project objectives to ensure that they do not just describe the nature of the project, but clearly set forth the underlying purpose of the project. Because the project objectives guide the agency in its selection of alternatives, a clearly written statement of objectives is necessary to ensure that feasible alternatives can be identified.

Written By: Tina Thomas and Amy Higuera

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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