Public BLAWG Blog

On January 4, 2012 Senate President Pro Tem Darrell Steinberg introducedSenate Bill 654, which (if passed) would allow municipalities to permanently retain the portion of redevelopment dollars earmarked for affordable housing projects. According to Steinberg, the bill is intended to preserve for affordable housing the roughly $2 billion in outstanding balances in the Low and Moderate Income Housing funds maintained by redevelopment agencies throughout the state.

For a copy of the proposed bill, click here.

On January 4, 2012 the California Sixth District Court of Appeal held that a City’s Final Environmental Impact Report (FEIR) was required to consider only reasonably foreseeable consequences of the sale of city-owned property. The City of Carmel-by-the-Sea owned land known as the Flanders Mansion property, which had historically been used for numerous low-intensity uses. The City approved a FEIR following its decision to sell the mansion. The report concluded that because the use of the property was constrained onlyto historical uses, a lease to another entity for a future use, such as an affordable housing project, was not feasible. The Flanders Foundation challenged the City’s approval and argued that the City did not sufficiently examine the potential environmental impacts associated with application of the Surplus Land Act which requires agencies to offer to sell or lease property to certain entities for affordable housing or park purposes before it offers the property to the general public.

The Court held that the City was not prohibited from selling the Mansion, and that it was not reasonably foreseeable that a public agency would spend millions of dollars to purchase and restore the property and accept the burden of complying with the restrictions for the purpose of using it for affordable housing. Given that such use was not foreseeable, the Court found that the FEIR was not required to consider the environmental impacts that could arise from such use.

For the full decision, see Flanders Foundation v. City of Carmel-by-the-Sea (Case No. H035818).

 AB 1344, which became effective on January 1, 2012, changes the law regarding employment and compensation for public agency managers.  It also requires public agencies to post meeting agendas on their websites and imposes new restrictions on changes to city charters.    Here is a summary of significant changes:  

The California Supreme Court today issued an opinion in the California Redevelopment Association v. Matosantos case, upholding Assembly Bill x1 26 (the "Redevelopment Dissolution" bill) and invalidating Assembly Bill x1 27 (the "Voluntary Payment" bill). The Court provided a four month extension for all deadlines contained in AB x1 26 that arise prior to May 1, 2012. As a result, effective February 1, 2012, all redevelopment agencies in California will be dissolved.

Prior to their dissolution, agency activities are limited to carrying out "enforceable obligations" as defined in AB x1 26. Following dissolution, the successor entity (the city or county that formed the agency, unless such jurisdiction elects not to fill this role) is charged with winding up the affairs of the dissolved agency, subject to review by an oversight board composed of representatives appointed by the city, the county, the local school district, the local community college district, and the largest local special district. By March 1, 2012, the successor entity is required to prepare a draft recognized obligation payment schedule describing enforceable obligations payable during the period from January through June 2012. The successor entity is directed to dispose of the assets of the former redevelopment agency with the proceeds to be transferred to the county auditor-controller for distribution to local taxing entities. The successor entity may elect to retain the housing assets and functions previously performed by the redevelopment agency; however, funds on deposit in the Low and Moderate Income Housing Fund are not retained by the successor entity.

The Court held that AB x1 27 (the measure that would have permitted cities and counties to continue the operation of their local redevelopment agency by agreeing to make specified payments for the benefit of schools and special districts) violates Proposition 22, the ballot measure adopted in 2010 that limits the legislature's ability to require local government payments.

Six justices signed the majority opinion. The Chief Justice issued a dissenting and concurring opinion in which she opined that AB x1 27 does not on its face compel the violation of Proposition 22.

Please contact any member of the Meyers Nave Redevelopment Practice Group for further information at 800.464.3559. 

The Court of Federal Claims’ recent opinion in Casitas Municipal Water District v. the United States, Court of Federal Claims No. 05-168L (Dec. 5, 2011) is the latest chapter in a legal battle between water diverters and fish in California.  Water users competing with endangered fish species for limited water resources have taken the fight to the courts in recent years (Tulare Lake, Klamath and now Casitas) with mixed results, claiming restrictions under the Endangered Species Act (“ESA”) requiring water to remain in streams for fish passage is a taking of their water rights.  Casitas operates a water project in Ventura County that provides water to residential, industrial and agricultural users.  In  2005, Casitas sued the U.S. for a 5^thAmendment taking after the National Marine Fisheries Service issued a biological opinion that required Casitas to provide fish passage over a diversion dam which blocked the fishes’ access to upstream habitat.  The government argued that no taking occurred because background principles of state law limited plaintiff’s water right to beneficial use of water in a manner that did not harm trust resources such as fish and wildlife. 

In concluding that no taking had occurred, the court clarified that the only compensable water right that can be obtained under California law is the right to beneficial use and that such water rights are limited by background principles of state law.  To the extent restrictions imposed under the ESA are no greater than the restrictions imposed under state law (i.e., the public trust doctrine, the reasonable use doctrine and the California Fish and Game Code), there is no taking under Lucas v. S.C. Coastal Council, 505 U.S. 1003 (1992).  The court found insufficient evidence to conclude that the ESA restrictions were duplicative of state background principles limiting the plaintiff’s water right, but then held the takings claim was not ripe because the restrictions imposed by the biological opinion had not interfered with the plaintiff’s beneficial use of water.  The court further held that if the State Water Resources Control Board were to act in the future to revise Casitas’ license and impose equal or greater restrictions to protect the fish than those imposed in the biological opinion, this would satisfy the Lucas standard and would eliminate any possible takings claim against the federal government.

This decision clarifies the limitations on California water rights from background principles of state law and the import of those limitations on the compensability for water lost due to ESA and other environmental protections.

In Ballona Wetlands Land Trust v. City of Los Angeles, the Court addressed an apparent inconsistency between the CEQA Guidelines and the statute.  The Court held the CEQA does not require analysis of the impacts of the existing environment on a proposed project (as distinguished from the impacts of the project on the environment), and sharply criticized the CEQA guidelines that suggest otherwise.  The opinion also upheld the EIR's discussion of mitigation for impacts to archeological resources, provides useful guidance on return to writ proceedings, and held that Respondents were prevailing parties for the purpose of awarding costs on the return to the writ, even though they lost the first round of CEQA litigation that led to initial issuance of the writ. 

This case potentially eliminates the need for agencies to determine the significance of certain types of impacts -- including some seismic risk, flood hazard, and climate change impacts -- to the extent that those impacts would be caused by the existing environment and would be experienced by the proposed project or its users.  Nevertheless, CEQA review likely still needs to analyze whether the proposed project would significantly exacerbate seismic risks, flood hazards, and climate change impacts on the environment.  This distinction will not always be easy to identify, and agencies should obtain legal advice before deciding to eliminate review of impacts traditionally considered in CEQA documents.

Go here for the full analysis of the Ballona Wetlands Land Trust v. City of Los Angeles case.

A California Court of Appeal affirmed a trial court's conclusion that the City of San Clemente's zoning of "Residential, Very Low Density" ("RVL") on an undeveloped 2.85 acre parcel in the middle of a residential tract otherwise zoned "Residential, Low Density" ("RL") constituted a constitutional "taking." The RVL designation limits parcels to one dwelling per 20 acres while the RL allows at least four dwellings per acre. Back in 1983, the City had originally approved plans to subdivide the parcel allowing for four single family lots, however, the construction never occurred. Neighborhood opposition desired the parcel to be declared "open space." A decade later the City amended its general plan to create the RVL zoning and impose it on several properties, including the subject property. All the parcels surrounding the subject property were and continued to be zoned RL. None of the owners of the parcel found out about the downzoning until 20 years later. After hiring a civil engineer to help them again try to develop the property, the owners submitted a development application to build four dwellings (seeking a general plan amendment, zoning amendment, tentative parcel map, site plan permit, conditional use permit and variance), the application was denied with the city council later approving the denial.

The owners served a writ of mandate alleging, in part, inverse condemnation based on spot zoning of the property. The trial court granted the writ concluding that the City did not give adequate notice of the downzoning, the RVL restrictions were arbitrary and capricious as applied to the property, and the owners' suit was timely under the applicable statute of limitations. The writ declared the City's resolution denying the owner's land use application null and void and ordered the City to adopt a new resolution. The inverse condemnation trial resulted in a judgment of "just compensation" in the amount of $1.3 million dollars. The court of appeal affirmed the writ and judgment but remanded to allow the City to decide which action it desired to do - - either pay the compensation, or, allow the property owners to develop the property under a new resolution.

For the full decision see Avenida San Juan Partnership v. City of San Clemente (December 14, 2011) 2011 DJDAR 17887.

Senate Bill 436, a bill signed into law in October of this year, changes definitions and adds Section 65967 to the mitigation lands section of the State Planning and Zoning Laws located in the Government Code. Current State Planning and Zoning laws allow a state or local agency to require mitigation land that is provided by an applicant to be transferred to that agency or a non-profit. Beginning January 1, 2012, local and state agencies will have additional options for the transfer and management of this mitigation land.

In 2007, the Greater Yellowstone Coalition (“Coalition”) filed a lawsuit against the U.S. Fish and Wildlife Service (“Service”), Greater Yellowstone Coalition Inc. v. Servheen, challenging the Service’s final rule (“Rule”) to remove the Yellowstone distinct population segment of grizzly bears from the Endangered Species Act’s threatened species list.  The Coalition prevailed on summary judgment, convincing the district court that two key grounds supporting the Rule – 1) adequate regulatory mechanisms were in place to protect the grizzly and 2) declines in whitebark pine did not threaten the grizzly - were not rationally supported by the record.  The Ninth Circuit Court of Appeals affirmed in part and reversed in part, reiterating the importance of a well-documented Agency record.