By Sarah E. Owsowitz, Best Best & Krieger LLP.

When I think about the California Environmental Quality Act, I am reminded of a line from the TV show “The West Wing,” in which a character remarked that Social Security was the “third rail” of American politics – never to be touched without electrocution. Here, as the 2013 legislative session has proved once again, CEQA, as it is widely known, is the “third rail” of California politics. All who touch it, from public agencies, to project developers, to environmental groups and labor unions, leave with singed hands and the conviction that they did not get what they wanted and maybe even came off a little worse than when they started.

Led by Sen. Michael Rubio, D-Shafter, 2013 promised to be the year that the Legislature started to make sense of California’s magnificent and troubled environmental statute. Passed in 1970, CEQA requires every city, county and public agency in California to analyze and disclose environmental impacts of proposed projects and adopt feasible measures to mitigate those impacts. But in recent years, advocates for reform have seen the law devolve into an increasingly byzantine set of rules that are regularly invoked for reasons other than environmental concerns by those who see CEQA as a convenient way to hold a project hostage or kill it.

On Feb. 22, the very day that Rubio resigned from the senate (to the dismay of CEQA reformers statewide), Senate President Pro Tem Darryl Steinberg, D-Sacramento, introduced SB 731, a bill containing a list of “intents” reflecting many reforms championed by Rubio, as well as Steinberg’s desires for streamlining approval of infill projects. The “intent” list included long hoped-for reforms such as putting an end to “late hit” document dumps by those opposed to projects merely to tee-up future litigation rather than provide agencies with an opportunity to respond to these last-minute comments. Another “intent”  was aimed at providing clearer direction to courts so that entire environmental documents were not invalidated just because the judge found minor errors. But, by Sept. 13, SB 731 was put on the shelf until next year’s legislative session and the bill had been amended to the point where it arguably furthered none of the “intents” (which were all deleted from the bill), leaving advocacy groups on all sides of the CEQA reform debate  frustrated and unhappy with the measures that were included.

So What Did Get Passed?

As part of the deal to put off SB 731 until next year, and with the support of Gov. Jerry Brown, Steinberg instead pushed through passage of Senate Bill 743. The governor now has until Oct. 13 to sign it into law, which he is expected to do. SB 743’s main purpose is to streamline environmental review for a proposed arena for the NBA’s Sacramento Kings, but it does include provisions that apply statewide:

  • Requires that challenges to certification of an environmental impact report, or EIR, and approval of an “environmental leadership development project,” including any appeals, be resolved within 270 days of the certification of the record of proceedings.

I bet you are wondering just what is an “environmental leadership development project” and whether you have any in your jurisdiction? These projects are a small class of “green” mega-projects that must invest at least $100 million in California. To use this provision, the governor must certify a project as an “environmental leadership development project” by Jan. 1, 2016.

  • Aesthetic impacts and parking impacts of a residential, mixed-use residential or employment center project on an “infill site” and within a “transit priority area” can no longer be considered significant impacts on the environment.

An “infill site” refers to a lot that is essentially surrounded on three sides by urban uses. A “transit priority area” includes any area within half a mile of an existing or planned major transit stop. While I have never seen a qualifying “transit priority area” project, this provision of SB 743 could, potentially, have broad application.

  • Requires that the state Office of Planning and Research  establish new thresholds of significance for noise and transportation impacts of projects within “transit priority areas.” These new thresholds would specify that automobile delay, as described solely by “level of service” (i.e. the level of traffic delay on a roadway), must no longer be considered a significant impact. The state agency would provide an alternative metric for assessing traffic impacts.

This was the provision of SB 743 most strongly championed by the governor and Office of Planning and Research, and was likely a condition of the governor’s support. It could change the way public agencies conduct traffic impact analyses in urban areas by focusing on congestion management rather than just maintaining a free flow of traffic. Of course, first you have to have a qualifying project – always the catch.

  • Expands an existing exemption for certain residential “infill projects” in “transit priority areas” that are covered by a specific plan that has already been the subject of environmental review to now also include mixed-use residential/commercial projects.

Great news, huh? Unfortunately, again, there is a catch. A project will only qualify to use the expanded exemption if it is consistent with an agency’s “sustainable communities strategy” or “alternative planning strategy.” This provision reflects one of  Steinberg’s primary missions: To tie CEQA into the requirements of his previous legislative success – the land use/transportation planning legislation known as SB 375.

In addition to SB 743, two other, more minor, CEQA bills have also been sent to the governor:

  • AB 417: Exempts bicycle transportation plans for urbanized areas from CEQA review.
  • AB 253:  Exempts from CEQA the conversion of an existing rental floating home marina to a resident-initiated subdivision, cooperative or condominium for floating homes under certain circumstances.

Whew! What about 2014?

SB 731 is now a “two-year bill,” meaning that it can be taken up again by the Legislature in 2014. However, Steinberg’s spokesman, Rhys Williams, recently indicated the senator is unlikely to pursue CEQA reform again next year. Indeed, by all indications, Steinberg was already tired of dealing with CEQA reform, referring to SB 731 as the “How to Make No Friends Act.”

There is another “two-year bill” to watch: AB 52, from Assemblyman Mike Gatto, D-Los Angeles. As currently written, this bill would require public agencies to consult with Native American tribes on any CEQA project requiring an EIR or a negative declaration where a tribe asserts it has an interest in the project area and requests such a consultation.

At the end of the day, it is important to keep perspective and to maintain, sadly, a healthy dose of cynicism when it comes to CEQA reform. In 2013, nearly 30 CEQA reform bills were introduced in what was supposed to be the year of reform. Only one bill of any real significance was passed and, even that bill, SB 743, could hardly be called “reform.” So, best guess, CEQA bills will keep on coming and the CEQA review process will likely keep becoming more, not less, complex.