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California Supreme Court Clarifies When Zoning Ordinance Amendments Trigger CEQA Review

On August 19, 2019, the California Supreme Court ruled on a fundamental California Environmental Quality Act (CEQA) issue: when is a zoning ordinance amendment considered a “project” subject to CEQA? The ordinance at issue was San Diego’s attempt to regulate the construction and operation of cannabis dispensaries within the City. The City concluded that the ordinance was not a “project” because it did not have the potential to cause a physical change in the environment.

The California Supreme Court ultimately disagreed with the City. In Union of Medical Marijuana Patients, Inc. v. City of San Diego (UMMP) the Court held that CEQA does not automatically apply to all zoning ordinance amendments (overruling a previous Court of Appeal’s decision holding to the contrary). However, the zoning ordinance amendments at issue in San Diego were certainly a “project” and thus do not evade CEQA review on the basis San Diego provided.

The Court’s ruling has direct implications for those businesses depending on such zoning amendments, providing an opportunity for a municipality or stakeholder to argue that any desired amendment does not necessarily trigger CEQA review. It is also of great importance to the cannabis industry, who can now be near certain that zoning ordinance amendments specifically for dispensary construction and operation may qualify as “projects” subject to CEQA. We discuss both of these impacts in greater detail below.

Background

In UMMP, the City amended its zoning ordinance to allow medical marijuana dispensaries to be located within the City, but further imposed restrictions as to the location and manner of operation of the dispensaries. The City concluded that its amendment action was not a “project” pursuant to CEQA, and therefore did not require any environmental review. CEQA defines a “project” as including any activity undertaken by a public agency and “which may cause either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment.” CEQA, Cal. Pub. Res. Code section 21065. 

UMMP subsequently challenged the City’s conclusion, claiming the ordinance was conclusively a “project” under CEQA section 21080(a), or, alternatively, that the amendment met the general definition of “project” under CEQA section 21065. Section 21080(a) excepts certain activities from the definition of “project,” but states that the definition of “project” still includes and applies to “discretionary projects proposed to be carried out or approved by public agencies, including, but not limited to, the enactment and amendment of zoning ordinances . . . unless the project is exempt from [CEQA].” CEQA, Cal. Pub. Res. Code section 21080. Applying either section, UMMP argued, because the City’s amendment was a “project,” the City should have conducted an environmental impact report on the physical changes the amendment would create, such as increased traffic.

The Court’s Decision in UMMP

UMMP’s argument that the City’s ordinance categorically qualifies as a CEQA “project,” was based on the bright line test adopted by the Court of Appeal in Rominger v. County of Colusa (2014) 229 Cal.App.4th 690. UMMP asserted that because “amendment to zoning ordinance” is expressly listed in section 21080(a), every zoning ordinance amendment is categorically a “project” subject to CEQA review.

The Court disagreed, criticizing Rominger for considering section 21080(a) separately and apart from the rest of CEQA, including section 21065, and rejecting its bright line rule. The Court found that section 21080 does not override section 21065. The list of example activities in section 21080(a), such as an amendment to zoning ordinances, are examples that may meet the definition of a “project” if the activity also satisfies section 21065.

The Court further stated that “[t]o subject such activities [like zoning] to CEQA as a matter, of course, serves no obvious public policy purpose.” The Court pointed out the scope of CEQA jurisdiction should not be so broad to risk CEQA becoming a tool to delay public agency actions that have no effect on the environment. As such, section 21065 must be considered in determining whether an activity is a “project.”

The Court also found that it may be reasonably foreseeable that the ordinance may cause an indirect physical change in the environment. The Court noted that the ordinance allows for the construction of several new businesses throughout the City, possibly altering traffic patterns. 

Impact

The Court, by rejecting Rominger’s bright line test, correctly adjusts the focus back upon whether an activity meets the definition of a “project” under section 21065. The Court also held that an ordinance may have a reasonably foreseeable change in the environment because of what it permits. Here, the construction of several new businesses and possible new traffic patterns will be created. The City’s reliance upon individual businesses having to comply with CEQA for their own projects, however, does not excuse the City’s duty to review pursuant to CEQA.

As for what the potential impacts may include, the UMMP case has been sent back to the lower court for further consideration. 

© 2020 Beveridge & Diamond PC National Law Review, Volume IX, Number 241

TRENDING LEGAL ANALYSIS


About this Author

Gary J. Smith Environmental Litigation Attorney Beveridge & Diamond San Francisco, CA
Principal

Gary Smith brings over 30 years of complex litigation experience to environmental matters.

Since his admission to practice in 1976, Gary has served as lead counsel or trial team member on a wide spectrum of trial court and appellate matters, including massive multi-party Superfund proceedings, complex groundwater contamination cases, nationwide consumer class actions, multi-million dollar construction disputes, and criminal antitrust prosecutions.

Gary enjoys an active litigation practice at Beveridge & Diamond, with an emphasis on environmental cases, particularly...

415-262-4045
David H. McCray Project & Infrastructure Development Attorney Beveridge & Diamond San Francisco, CA
Of Counsel

David's practice focuses on major project and infrastructure development, including environmental reviews, permitting and approvals from a wide range of federal and state natural resources agencies, and litigation of project decisions and policies.

He counsels clients on regulatory matters and litigation involving the California Environmental Quality Act (CEQA), the National Environmental Policy Act (NEPA), climate change, water, wetlands, project mitigation, land use, air, and mobile source air toxics and related health impacts. He also works on cutting-edge technological advances such as autonomous and connected vehicles. David co-chairs the firm’s Infrastructure and Real Estate practice.

In 2019, California Governor Newsom reappointed David as a justice on the California Courts-Martial Appellate Panel where he is responsible for hearing criminal appeals involving California Guard and Reserve personnel. David was first appointed to the four-year term position in 2015 by then-Governor Brown.

David served as Assistant Chief Counsel at the California Department of Transportation (Caltrans) from 2007-2014 and was the Department's most senior environmental attorney. He led a team in litigating for and providing advice to the Governor’s office and Caltrans' staff involving complex environmental, regulatory, Native American, and real estate development issues on multi-million dollar transportation projects.

Before joining Caltrans, David served with the U.S. Air Force, retiring after 21 years of active service. He held positions such as the Chief of the Air Force Environmental & Tort Litigation Branch; the Base Staff Judge Advocate at Beale Air Force Base, California; and the Deputy Staff Judge Advocate at Whiteman Air Force Base, Missouri, where he also managed the environmental law program. While with the Air Force, David also served for two years as Special Assistant U.S. Attorney in the Environmental & Natural Resources Division of the U.S. Department of Justice in Washington, DC.

David frequently speaks on panels about environmental law issues, as well as autonomous and connected vehicles. He volunteers time to organize and participate on panels at California law schools where he discusses the importance of diversity in the practice of environmental law.

415-262-4025
Christopher D. Strunk Environmental Litigation Attorney Beveridge & Diamond San Francisco, CA
Of Counsel

Christopher D. Strunk has more than 20 years of experience litigating complex environmental and toxic tort disputes.  

He focuses on the defense of large, multi-party environmental matters, including mass tort and products liability litigation involving alleged toxic injury arising from asbestos, lead, mold, solvents, and other contaminants. He has represented microchip and technology companies, chemical and petrochemical companies, heavy equipment manufacturers, and the pesticide and fertilizer industry. Over the past five years, he has also developed a significant industrial hemp...

415-262-4016
Jacob P. Duginski Environmental Attorney Beveridge & Diamond San Francisco, CA
Associate

Jake maintains a diverse regulatory and litigation practice providing client-centered, solution-driven advice.

He litigates before California’s trial and appellate courts, advises on regulatory compliance with a focus on California-specific issues, and represents clients in various administrative enforcement settings. His practice philosophy is to provide sound, timely, actionable advice with sensitivity to each individual client’s business needs. 

Clean Air, Climate Change, and CEQA

Clients who operate in California routinely find themselves with...

415-262-4018
Kate A. Tipple Environmental Litigation Attorney Beveridge & Diamond San Francisco, CA
Associate

Kate Tipple combines legal experience with a science and environmental management background to creatively tailor effective litigation and compliance strategies.

While Kate’s experience with environmental law is broad, she has a strong background in water resources and environmental litigation. Her successful litigation experience involves civil and administrative enforcement proceedings, contaminated property matters, and appellate work.

In addition, Kate advises clients on a variety of regulatory compliance issues, including federal and state consumer product and chemical...

415-262-4015