California Environmental Quality Act (CEQA) Guidelines

The Supreme Court addressed the selection of the California Environmental Quality Act (CEQA) baselines at length in Communities for a Better Environment v. South Coast Air Quality Management Dist. (2010) 48 Cal.4th 310. In that case, ConocoPhillips sought permits to modify or replace existing refinery equipment in order to produce a new low-sulfur diesel fuel. (Id. at p. 317.) Although the modified or new equipment would release more NOx (nitrogen oxide) gas than was currently being released at the site, the heightened emission level would still be within that allowed by existing permits. (Id. at p. 318.) The air quality district therefore treated the permitted emission level as part of the baseline, even though the actual emissions at the site had not reached that level. (Ibid.) Measured against this baseline, the district concluded the low-sulfur fuel project would not have significant environmental impacts and did not prepare an environmental impact report (EIR). (Ibid.) The Court of Appeal reversed. The Supreme Court affirmed the appellate court, holding the baseline did not reflect "a realistic description of the existing conditions without the Diesel Project." (Id. at p. 322.) "By comparing the proposed project to what could happen, rather than to what was actually happening, the District set the baseline not according to 'established levels of a particular use,' but by 'merely hypothetical conditions allowable' under the permits." (Communities, supra, 48 Cal.4th at p. 322, quoting San Joaquin Raptor Rescue Center v. County of Merced (2007) 149 Cal.App.4th 645, 658.) However, to afford meaningful environmental review of a proposed project's impact, a CEQA baseline must reflect "the 'existing physical conditions in the affected area' , that is the ' "real conditions on the ground" ' , rather than the level of development or activity that could or should have been present according to a plan or regulation." (Communities, at pp. 320-321.) The Supreme Court observed the "CEQA Guidelines" (Cal. Code Regs., tit. 14, 15000 et seq.) provide: " 'An EIR must include a description of the physical environmental conditions in the vicinity of the project, as they exist at the time the notice of preparation is published, or if no notice of preparation is published, at the time environmental analysis is commenced, from both a local and regional perspective. This environmental setting will normally constitute the baseline physical conditions by which a lead agency determines whether an impact is significant.' " (Communities, supra, 48 Cal.4th at p. 320, quoting CEQA Guidelines, 15125, subd. (a).) Accordingly, the "normal" rule is that the baseline must reflect the "physical conditions existing at the time the environmental analysis" begins. (Communities, at pp. 320, 323; see also In re Bay-Delta etc. (2008) 43 Cal.4th 1143, 1167-1168 77 Cal.Rptr.3d 578, preexisting environmental problems in the Bay Delta were part of the baseline conditions against which the potential impacts of the proposed project were to be measured; Woodward Park Homeowners Assn., Inc. v. City of Fresno (2007) 150 Cal.App.4th 683, 693 citing the "normal" rule and holding potential impacts of proposed development had to be measured against current undeveloped condition of the property, not development permissible under existing zoning.) The court further observed a "long line of Court of Appeal decisions holds that the impacts of a proposed project are ordinarily to be compared to the actual environmental conditions existing at the time of CEQA analysis, rather than to allowable conditions defined by a plan or regulatory framework." (Communities, supra, 48 Cal.4th at p. 321.) Moreover, these cases reached this result even when the actual conditions were in violation of current regulatory provisions. (Ibid. & fn. 7.) For example, in Riverwatch v. County of San Diego (1999) 76 Cal.App.4th 1428 91 Cal.Rptr.2d 322 (Riverwatch), the appellate court approved the county's chosen baseline, which included illegal development that had occurred at a mining operation seeking a use permit. The respondents could not, said the court, essentially turn back the clock and insist upon a baseline that excluded existing conditions. (Id. at pp. 1452-1453.) How present conditions come to exist may interest enforcement agencies, but that is irrelevant to CEQA baseline determinations--even if it means preexisting development will escape environmental review under CEQA. (Riverwatch, at pp. 1452-1453.) In Fat v. County of Sacramento (2002) 97 Cal.App.4th 1270, the appellate court upheld the county's choice of a baseline reflecting present-day conditions to evaluate the impact of a proposed airport expansion. Even though "the Airport developed over a period of nearly 30 years without County authorization, there was evidence of environmental damage during that period, and the Airport had been the subject of at least two zoning enforcement actions ... ," the county acted within its discretion using current airport operations as the baseline for CEQA review. (Fat, at pp. 1280-1281.) Similarly, in Eureka Citizens for Responsible Government v. City of Eureka (2007) 147 Cal.App.4th 357, the Court of Appeal upheld a project description for CEQA purposes that took into account an existing playground built contrary to code. "While any alleged code violations in the construction of the playground may have been relevant to the City's consideration of the variance requested, it was not a CEQA consideration." (Eureka, at p. 371; see also Fairview Neighbors v. County of Ventura (1999) 70 Cal.App.4th 238, 242-243 EIR prepared in conjunction for application to expand mining operation "properly discussed the existing physical condition of the affected area as including the long-operating mine"; Bloom v. McGurk (1994) 26 Cal.App.4th 1307, 1312-1316 & fn. 3 " 'existing facility' " for categorical exemption purposes means a facility "as it exists at the time of the agency's determination, rather than ... at the time CEQA was enacted"; this is consistent "with cases that have required potential impacts to be examined in light of the environment as it exists when a project is approved".) Accordingly, in Communities, the Supreme Court affirmed the Court of Appeal's directive that writ relief be granted and the matter be sent back to the air quality district to identify an appropriate baseline and reassess the environmental impacts of the proposed low-sulfur fuel project. (Communities, supra, 48 Cal.4th at pp. 327-329.)