In Cleveland Nat’l Forest Found. v. San Diego Ass’n of Gov’ts (July 13, 2017), the California Supreme Court reversed the Court of Appeal decision regarding the inadequacy of the greenhouse gas (GHG) emissions impacts analysis in the Environmental Impact Report (EIR) for the 2050 Regional Transportation Plan/Sustainable Communities Strategy (RTP) adopted by the San Diego Association of Governments (SANDAG) in 2011. The Supreme Court holding reinforces the general rule that lead agencies have substantial discretion in determining how to evaluate and discuss environmental impacts and significance thresholds. However, the decision is narrow, as the Supreme Court stressed that lead agencies cannot "shirk their responsibilities" when complying with the California Environmental Quality Act (CEQA), and remanded the case to the Court of Appeal to address other alleged inadequacies of the EIR. 

The Supreme Court held that SANDAG did not abuse its discretion by not explicitly engaging in a consistency analysis between the RTP's projected 2050 GHG emissions with Executive Order No. S-3-05 (EO). The EO mandates a reduction of GHG emissions in California to 80 percent below 1990 levels by 2050. The Supreme Court held that the EIR provided sufficient information to the public, "based on information available at the time, about the [RTP's GHG] impacts and its potential inconsistency with state climate change goals." However the Supreme Court narrowed its ruling, stating that the SANDAG's GHG analysis in the EIR would not be sufficient going forward, and that the CEQA GHG analysis should "stay in step with evolving scientific knowledge and state regulatory schemes."

The Supreme Court only rejected the Court of Appeal's decision regarding the EIR's GHG impacts analysis as being inadequate. The Supreme Court did not address the Court of Appeal's ruling that the EIR’s evaluation of GHG mitigation measures and other environmental issues were inadequate, or the Court of Appeal's decision to issue a writ of mandate setting aside the EIR‘s certification on those grounds. The Supreme Court remanded the case to the Court of Appeal to address these other alleged inadequacies of the EIR.

Background

In 2005, Governor Schwarzenegger issued Executive Order S-3-05 that established statewide GHG emissions reduction targets of reducing GHG emissions to 1990 levels by 2020 and to 80 percent below 1990 levels by 2050. 

SANDAG certified an EIR and adopted the RTP in October 2011. SANDAG used the GHG reduction goal in Assembly Bill AB 32 (the California Global Warming Solutions Act of 2006) as a significance threshold standard in the EIR to determine whether the transportation and non-transportation sources of GHG emissions from the project would have a significant impact on the environment.  AB 32 requires a reduction in the state's GHG emission to 1990 levels by 2020. The EIR found that the RTP would reduce GHG emissions until 2020, but would increase them in later years. While the EIR did discuss the EO's 2050 GHG emissions reduction target, it did not treat the EO's long-term GHG emissions reduction goal of 80 percent below 1990 level by 2050 as a standard for assessing the significance of the RTP’s GHG impacts. SANDAG argued that CEQA Guidelines section 15064.4 does not require a lead agency to consider executive orders or legislation in determining the significance threshold that applies to a specific project. The plaintiffs and the California Attorney General challenged the EIR on several grounds, including that the EIR violated CEQA by failing to analyze the inconsistency between the RTP’s GHG emissions impacts after 2020 and the emission reduction goals in the EO.

Lower Court Rulings

The superior court held that the EIR failed to fulfill its role as an informational document under CEQA because it failed to analyze the inconsistency between the RTP's GHG emissions impacts after 2020 and the emission reduction goals in the EO. The court also found that the EIR did not adequately address mitigation measures for the significant GHG emissions impacts. 

SANDAG appealed, arguing that the EIR complied with CEQA, and plaintiffs cross-appealed, arguing the EIR further violated CEQA by : (1) failing to analyze a reasonable range of alternatives; (2) failing to adequately analyze and mitigate the transportation plan’s air quality impacts; and (3) understating the transportation plan’s impacts on agricultural lands. The State Attorney General separately cross-appealed, contending that the EIR further violated CEQA by not adequately analyzing or mitigating the RTP’s impacts from particulate matter pollution.

The Court of Appeal largely agreed with the plaintiffs and affirmed the trial court's judgment setting aside the EIR certification for all of the reasons identified above. Specifically, the court held that by omitting from the EIR a discussion of the RTP’s consistency with the state climate policy outlined in the EO for continual GHG emissions reductions, SANDAG prejudicially abused its discretion. Failing to include such an analysis deprived the public and decision-makers of important information regarding the project’s GHG emissions. 

SANDAG appealed the Court of Appeal decision to the Supreme Court, and on March 13, 2015, the Supreme Court granted a limited review on the following question:

Must the environmental impact report (EIR) for a regional transportation plan include an analysis of the plan’s consistency with the greenhouse gas emission reduction goals reflected in Executive Order No. S-3-05 to comply with the California Environmental Quality Act (CEQA) (Pub. Resources Code, § 21000 et seq.)?

California Supreme Court Ruling

The Supreme Court reversed the Court of Appeal decision and concluded that SANDAG did not abuse its discretion when it did not use EO's 2050 GHG emissions reduction targets as significance thresholds. 

The majority of justices found that the EIR did not obscure the existence or contextual significance of the EO's 2050 emission reduction goals. Rather, the EIR clearly stated that the 2050 GHG emissions reduction target is a part of the RTP's regulatory setting. The EIR mentioned the 2050 target and explained why SANDAG did not use the EO's 2050 target as a significance threshold. The EIR clearly stated that the RTP's implementation would result in significant GHG impacts as the projected 2035 and 2050 GHG emissions would be greater than the 2010 GHG emissions of the region. As such, the EIR clearly presented the divergence between the projected 2050 emissions and the EO's goals, rather than "hiding the elephant in the room."

However, the Supreme Court cautioned that other aspects of SANDAG's analysis were problematic. SANDAG's conclusory statement that the RTP's projected role in achieving the EO’s 2050 emission reduction target is “likely small” is not a reason to reject the EO's 2050 GHG emission reduction target as a measure of significance, or to conclude that the RTP's impacts will be insignificant in the context of the statewide goal. “The solution to climate change requires the aggregation of many small reductions in [GHG] emissions by public and private actors at all levels.” But the SANDAG's threefold GHG significance thresholds, authorized by CEQA Guidelines section 15064.4(b), adequately informed the readers of the potential GHG impacts. 

The Supreme Court further cautioned the public agencies that the decision finding SANDAG's analysis of GHG emission impacts in this particular EIR as adequate does not mean that this analysis will be sufficient in future EIRs. The majority clarified that “[n]othing we say today invites regional planners to ‘shirk their responsibilities’ under CEQA or other environmental statutes. To the contrary, we affirm that planning agencies like SANDAG must ensure that CEQA analysis stays in step with evolving scientific knowledge and state regulatory schemes.”

Dissent Finds that the EIR is Inadequate in Presenting RTP's Long-term Environmental Harm 

Justice Mariano-Florentino Cuellar was the lone dissenter finding that SANDAG was shirking its responsibility under the state policies because of the increase in the RTP's per capita GHG emissions and the vehicle mile traveled (VMT) by 2050, despite the EO’s and the Senate Bill 375's (Sustainable Communities and Climate Protection Act ) statewide goal of requiring a substantial reduction of GHG emissions and the VMTs. Justice Cuellar found that the EIR is not clear enough about the long-term environmental harm of SANDAG's RTP “because among other things, the EIR manages to occlude the elephant in the room — that the [RTP] was associated with a major projected increase in [GHG] emissions, diverging sharply from emission reduction targets reflecting scientific consensus.”

Insights

This Supreme Court decision reaffirms the lead agency's discretion to establish its own significance thresholds under CEQA. The court further reaffirmed that the executive orders in itself lack the force of a legal mandate that would require the CEQA lead agencies to consider them in setting significance thresholds. The Supreme Court also reaffirmed its stand in Center for Biological Diversity v. California Department of Fish & Wildlife, 62 Cal.4th 204 (2015) that the projects have to consider their long-term GHG impacts. But by narrowing its ruling regarding the adequacy of the GHG impacts analysis in this instance only, the Supreme Court failed to provide any clear guidance or address the uncertainty created after the Center for Biological Diversity decision regarding a project's GHG and climate change impacts under CEQA. 

Given this uncertainty and the narrowness of this ruling, developers and lead agencies would be prudent to consider not only the AB 32 GHG reduction goals for 2020 and the recently approved 2030 GHG emissions reduction goals under Senate Bill 32, but also the 2050 GHG emission reduction goals of the EO, depending on the size and life of the project.