January 20, 2020

January 17, 2020

Subscribe to Latest Legal News and Analysis

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

TRENDING LEGAL ANALYSIS


About this Author

Gary J Smith, Environmental Attorney, Beveridge and Diamond Law Firm
Shareholder

Gary J. Smith has over 30 years of complex litigation experience. Since his admission to practice in 1976, Mr. Smith 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.

(415) 262-4045
David McCray, Infrastructure development, Beveridge and Diamond Law Firm
Of Counsel

David McCray’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 defense of project decisions and policies.  He counsels clients on regulatory matters and litigation regarding issues such as the California Environmental Quality Act (CEQA), the National Environmental Policy Act (NEPA), climate change, water, wetlands, project mitigation, and mobile source air toxics and related health impacts.

415-262-4025
Chris Strunk, Beveridge Diamond, Environmental lawyer
Of Counsel

Chris counsels clients on toxic tort, commercial litigation, and business transactions, with a focus on complex litigation involving the defense of toxic injury product liability and premises liability claims involving asbestos, mold, and airborne and water-borne contaminants and chemicals.

He represents multinational manufacturers of heavy industrial equipment, such as valves, pumps, and automobile engine gaskets and brakes; flooring material manufacturers; pesticide and fertilizer manufacturers and suppliers; and chemical and petrochemical...

1.415.262.4016
Jacob P. Duginski, Beveridge Diamond, Environmental Regulation Attorney, Manufacturing Industry Lawyer
Associate

Jacob Duginski works with clients nationwide across industrial sectors on a variety of environmental litigation and regulatory matters.

While at Lewis & Clark Law School, Jacob served as Associate Editor of Environmental Law (Law Review), and as a case summary author for Ninth Circuit Environmental Review, writing and editing summaries of cutting-edge environmental cases in the Ninth Circuit which were published in Environmental Law. Jacob competed in the National Environmental Law Moot Court Competition at Pace Law...

(415) 262-4018
Kate Tipple Science & Environment Attorney
Associate

Kate 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...

415.262.4015