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In a long-awaited decision, on December 24, 2018 the California Supreme Court in Sierra Club v. County of Fresno (S219783) affirmed, in part, and reversed, in part, the Fifth District Court of Appeal’s decision concerning a challenge to the adequacy of an EIR prepared for the Friant Ranch retirement community (“Project”).  Employing a de novo standard of review, the Court found that the Project EIR is inadequate as a matter of law because the EIR did not make a reasonable effort to connect the Project’s air quality impacts to specific health consequences (or explain why it is not feasible to do so).  The Court also upheld the lead agency County of Fresno’s discretion to substitute equally effective or more superior future mitigation measures and adopt mitigation measures that do not reduce the Project’s significant and unavoidable impacts to a less-than-significant level.  This decision poses significant hurdles for project proponents going forward with new, heightened requirements for EIR analysis of environmental and health impacts and a more scrutinizing, independent legal standard of review for challenges to the adequacy of an EIR.

The Project is a Master Planned community on a 942-acre site that sits adjacent to the unincorporated community of Friant in north central Fresno County.  The Project consists of 2,500 single and multi-family residential units that are age restricted to “active” adults age 55 and older, 250,000 square feet of commercial space, and the dedication of 460 acres of open space.  The County approved the final EIR for the Project on February 1, 2011 and approval was subsequently challenged by a number of nonprofit environmental and civic action groups, including the Sierra Club and the League of Women Voters of Fresno.  The trial court upheld the Project’s EIR, but the Fifth District Court of Appeal reversed and remanded the case back to the trial court.  The appellate court held, among other things, that the sufficiency of an EIR’s discussion of required CEQA topics presents a question of law subject to independent judicial review, the EIR inadequately set forth how the project’s air quality impacts would impact the health of neighboring residents, and the Project’s mitigation measures were vague, unenforceable, and unsupported by analysis.  Real Party in Interest Friant Ranch appealed, and the California Supreme Court granted review in October of 2014.  The California Supreme Court’s October 2, 2018 oral argument in this matter is detailed in our prior blog post.

The California Supreme Court first discussed the appropriate legal standard of review for a challenge to the adequacy of an EIR’s discussion of environmental impacts.  Looking at Laurel Heights Improvement Assn. v. Regents of University of California (1988) 47 Cal.3d 376, and other cases involving an EIR’s adequacy, the Court noted that state appellate courts have consistently recognized that adequacy of discussion claims are not typically amenable to substantial evidence review.  For instance, in Laurel Heights, the California Supreme Court had previously found that the UCSF campus’ EIR’s 250-page analysis only contained one and one-half pages of different alternatives, thus constituting an insufficient discussion subject to de novo scrutiny.  The Court concluded based on its review of applicable case law that an EIR adequacy challenge is a mixed question of law and fact subject to independent, de novo legal review.

Using an independent legal review, the California Supreme Court went on to consider whether the Project’s EIR was sufficient.  The Project’s EIR described that the Project would emit 117.38 tons per year of PM10, 109.52 tons of reactive organic gases, and 102.19 tons of nitrogen oxides and concluded that significant impacts are unavoidable because the local air district’s thresholds of significance are 15, 10 and 10 tons per year for PM10, ROG, and NOx, respectively.  The EIR also provided background information about PM10, including a general discussion of adverse health effects for exposure to ozone (set forth in parts per million).  Yet, the Court nonetheless concluded that the EIR’s discussion is inadequate because: (1) the EIR only provides a “general description of symptoms that are associated with exposure to ozone and the discussion of health impacts regarding each type of pollutant is at most a few sentences of general information,” (2) the “disclosures of health effects fail to indicate the concentrations of which such pollutants would trigger the identified symptoms,” and (3) the EIR’s discussion of ozone health impacts is not helpful because it is presented in parts per million, while the EIR only provides the estimated tons per year of reactive organic material (ROG and NOx, the two components that react with sunlight to form ozone).

In doing so, the Court emphasized that CEQA requires that an EIR make “a reasonable effort to discuss relevant specifics regarding the connection between the general health effects associated with a particular pollutant and the estimated amount of that pollutant the project will likely produce.”  To the extent that it is not scientifically possible to do more to connect adverse air quality impacts with potential human health impacts, the EIR itself must explain “why, in a manner reasonably calculated to inform the public of the scope of what is and is not yet known about the Project’s impacts.”  Although the Project’s EIR generally outlined some of the unhealthy symptoms associated with exposure to various pollutants, it did not give any sense of the “nature and magnitude” of the health and safety problems caused by the physical changes resulting from the Project.  More information, as a result, was needed to understand adverse impacts beyond a “better/worse dichotomy.”  In sum, the Court made clear – the “EIR must provide an adequate analysis to inform the public how its bare numbers translate to create potential adverse impacts or it must adequately explain what the agency does know and why, given existing scientific constraints, it cannot translate potential health impacts further.”

The Supreme Court ended with a review of the Project EIR’s discussion of mitigation measures.  First, the Project’s EIR discussion that the mitigation measures will “substantially reduce air quality impacts” was determined, as a matter of law, to be inadequate under CEQA’s disclosure requirements.  The EIR, as noted by the Court, must provide facts or analysis to support the inference that mitigation will have a quantifiable substantial impact on reducing adverse effects, not just “bare conclusions or opinions.”  Second, the Court held that the County did not impermissibly defer mitigation measures by using a mitigation substitution clause that allows for “different air pollution control measures . . . that are equally effective or superior . . . as new technology and/or other feasible measures become available.”  Because future substitutions of equal or better measures promotes CEQA’s goal of environmental protection, the County could leave open the possibility of employing better mitigation efforts consistent with improvements in technology.  Third, the Court held that the County can adopt mitigation measures that do not reduce the Project’s adverse impacts to less-than-significant levels, so long as the County can demonstrate in good faith that the measures will at least be partially effective at mitigating the Project’s impacts.  And fourth, the Project’s mitigation involving the installation of certain HVAC systems and tree planting are enforceable because the Project’s mitigation monitoring and reporting program expressly places the burden of enforcement on the County.

The Friant Ranch decision ushers in a new era for EIRs, particularly with respect to environmental impacts and accompanying human health consequences.  The prospect of correlating air emissions with potential health effects is daunting from a technical perspective and will add yet another significant cost to the already laborious and expensive process of preparing an EIR.  Equally problematic is the Court’s overly expansive application of the de novo standard of review, which is typically (and ought to be) reserved for true procedural errors.