In Mission Bay Alliance v. Office of Community Investment & Infrastructure (2016) 6 Cal. App. 5th 160, the First Appellate District affirmed the trial court’s ruling that the Office of Community Investment and Infrastructure (OCII) complied fully with CEQA in approving a proposed 488,000-square foot multipurpose event center, which would serve as the Golden State Warriors’ new arena, and a variety of mixed-use structures surrounding the event center including two 11-story office and retail buildings, parking facilities, and 3.2 acres of open space.

The litigation proceeded under CEQA’s “environmental leadership development project” procedures, which provide for expedited litigation. Specifically, these procedures state that the litigation, including any appeals, should be resolved within 270 days of certification administrative record. Despite petitioners initially filing the litigation in the wrong venue and other circumstances that delayed the proceeding, the court was nevertheless able to issue its opinion about 270 days from certification of the administrative record.

The Project was proposed in the Mission Bay South Redevelopment Plan (Plan) area of City and County of San Francisco (City). The Plan was approved in late 1998 after certification of a Mission Bay final subsequent environmental impact report (1998 FSEIR), which incorporated information from a prior 1990 FEIR for the Plan area. In approving the Project, OCII prepared a supplemental environmental impact report (SEIR) for the Project, tiered to the 1998 FSEIR.

Petitioners argued that the Project SEIR failed to comply with CEQA because issues that the initial study concluded were insignificant or adequately examined in the 1998 FSEIR, including land use, biological resources, hazardous materials, and recreation impacts, may nevertheless be significant. Petitioners alleged these challenges were subject to the “fair argument” standard of review. The court rejected Petitioners’ argument and held that the “substantial evidence” standard applies. Based on this deferential standard of review, the court rejected each of petitioners’ land use, biological resources, hazardous materials, and recreation impact challenges.

Petitioners also advanced several challenges concerning the transportation analysis. The SEIR demonstrated that the Project presented a number of traffic and congestion concerns. As a result, the Project included a transportation management plan (TMP) and transit service plan (TSP), new or upgraded traffic signals or lane configurations at 20 intersections and construction of six new street segments, as well as expansion or modification of light rail passenger platforms, sidewalks and bicycle lanes.

Petitioners argued that the Project SEIR violated CEQA by including the TSP as part of the project description rather than as a mitigation measure. The court explained that the inclusion of the TSP as part of the Project did not interfere with the identification of the Project’s transportation impacts because the SEIR included analysis both with and without implementation of the TSP, distinguishing this case from Lotus v. Department of Transportation (2014) 223 Cal.App.4th 645. Petitioners also argued that the TSP was inadequate because it may require the diversion of two streetcars from other transit lines in the City and asserted that this diversion may result in significant impacts on the lines from which the cars are diverted. The court rejected this argument as an “entirely speculative environmental impact.” The court also rejected Petitioners’ challenge to a mitigation measure requiring the Warriors to “work with” regional transit providers to provide adequate transit service. The court explained that substantial evidence in the record demonstrated that, through coordination among the regional transit agencies, transit demands in the region could be met. Furthermore, the court rejected petitioners’ demand that the Warriors guarantee transit funding in the event the traditional funding sources fell short. The court acknowledged that the SEIR did not identify specific funding sources, but held that substantial evidence in the record demonstrated that funding sources, such as fair recovery and a countywide sales tax dedication, should be available to address future transit needs.

Next, the court rejected petitioners’ argument that an “ambient plus increment” noise threshold ignores the severity of existing noise levels and is an inadequate noise threshold. The court also rejected petitioners’ claim that the SEIR must include a health-based threshold for noise. The court found that the SEIR adequately disclosed potential health impacts associated with noise and that OCII had the discretion to use an “ambient plus increment” noise threshold. The court noted that the CEQA Guidelines support use of an increment-based threshold. Additionally, the court found that the SEIR took the severity of existing noise levels into account by applying a smaller incremental noise threshold at intersections with noise in excess of 65 dBA.

Petitioners also argued that the wind analysis included in the SEIR was inadequate because it focused on wind impacts at off-site public areas rather than at onsite public areas. Citing Ballona Wetlands Land Trust v. City of Los Angeles (2011) 201 Cal.App.4th 455, 473, the court held that CEQA does not require an analysis of wind impacts on the Project. Moreover, the court concluded that a discussion of wind at onsite public areas was provided in the SEIR “for informational purposes,” which adequately addressed petitioners’ complaint concerning onsite wind impacts even if it was required.

Turning to the greenhouse gas (GHG) analysis, the court rejected petitioners’ claim that by relying on compliance with the City’s qualitative GHG Strategy the SEIR failed to disclose the magnitude of the Project’s GHG emissions and violated an alleged requirement to quantify a project’s GHG emissions. While the CEQA Guidelines provide that a lead agency “should make a good-faith effort, based to the extent possible on scientific and factual data, to describe, calculate or estimate the amount of greenhouse gas emissions resulting from a project” (quoting CEQA Guidelines section 15064.4, subd. (b)(1)), the “Guidelines do not compel a numeric estimate of every project’s greenhouse gas emissions.” Citing CEQA Guidelines section 15064.4 and 15183.5, the court explained that a lead agency may rely on a qualitative GHG analysis or performance base standards using an area wide plan. Furthermore, the court reiterated that, in Center for Biological Diversity v. Department of Fish & Wildlife (2015) 62 Cal.4th 204, the “California Supreme Court expressed approval for a methodology that uses consistency with greenhouse gas reduction plans as a significance criterion for project emissions under CEQA.”

Petitioners’ final challenge to the SEIR concerned the analysis of toxic air contaminants (TAC). Petitioners asserted that it was inappropriate to use a 100 in a million total cancer risk (from area sources) as the significance threshold for project-level TAC risk. Instead, petitioners argued that the SEIR should have used a 10 in a million project-only emission standard. Because substantial evidence supported OCII’s choice of significance threshold, the court upheld the approach used in the SEIR.

Petitioners also raised non-CEQA challenges alleging a zoning violation and that the City improperly issued a place of entertainment permit for the Project. With respect to the zoning claim, although the City’s Planning Department defined the event center as a “retail use” for the purposes of the City’s Planning Code, the court held under OCII’s Plan the bulk of the event center did not constitute a “retail use.” As to the City’s issuance of the place of entertainment permit, the court held that the City did not abuse its discretion in issuing the permit, given its finding that the Project would sufficiently protect the peaceful enjoyment of neighboring properties from the Project’s noise impacts.

Key Point:

Where an EIR is prepared, the substantial evidence standard of review applies to challenges concerning analysis included either in the initial study or the EIR. Furthermore, CEQA does not require absolute certainty regarding funding sources for mitigation measures. Finally, a lead agency may rely on a qualitative GHG analysis or performance base standards using an area wide plan.