Democrats plan overhaul of landmark environmental law

Gov. Jerry Brown and his fellow Democrats in the Legislature are planning an overhaul of a sweeping environmental law blamed for high business costs, permitting delays and lawsuits.

At issue is the 1970 California Environmental Quality Act, or CEQA, signed by Gov. Ronald Reagan after a massive 1969 oil spill off Santa Barbara.

CEQA's reach exceeds that of the federal National Environmental Policy Act by requiring an "environmental impact report" analyzing any project that needs state or local approval. The federal law applies only to projects that need federal agency approval or use federal funding (Greenwire, Nov. 7, 2011).

The California law has been a reform target for several years. Former Gov. Arnold Schwarzenegger (R) famously railed against squirrels and tortoises blocking solar plants. And Brown signed bills last year to streamline the process for challenging large projects -- a planned football stadium in Los Angeles and Apple Inc.'s office expansion, for example -- and reviewing planned redevelopment work.

"I've never seen a CEQA exemption I don't like," Brown said earlier this year.


Appetite for CEQA reform has grown recently. Senate President Pro Tem Darrell Steinberg (D) and Sen. Michael Rubio (D) have been meeting since October with environmentalists, developers, tribal groups and others to explore changes. There is no timetable yet for the release of a reform bill.

"The detail isn't there yet, but essentially the idea to modernize it is to streamline processes for getting projects approved or dismissed," Steinberg spokesman Rhys Williams said. "There have been many attempts to weaken the law, and that's not Senator Steinberg's intention. As he sees it, the intent is to modernize it, make it more relevant, make it work better."

On the table is a proposal floated by Rubio in August that would have prohibited CEQA lawsuits citing other federal, state and local environmental and land-use laws as long as projects comply with those laws. Other proposals would require CEQA plaintiffs to pay agencies for recordkeeping and require disclosure of the names of members of plaintiff groups, said Jennifer Hernandez, a Holland & Knight lawyer who represents developers, utilities and redevelopment agencies.

Clarifying the recordkeeping rules is aimed at preventing plaintiffs from going back to the judge "two, three times before everyone just behaves and acts like a grownup," she said.

Some environmentalists are optimistic about reforms, and others are wary.

CEQA's "got good bone structure, and what [Rubio] is proposing would be like inserting bone cancer," said Kathryn Phillips, executive director of Sierra Club California. "I haven't heard him move away from the proposal he did last August."

Phillips said industry often seizes upon CEQA reform in times of economic turmoil, when financing or other obstacles are the real culprits.

"In my view, the developers get really frustrated and there's nothing else to do," she said. "They go after CEQA."

She pointed to a 2005 report by the nonpartisan Public Policy Institute of California that says there is one lawsuit for every 350 CEQA project reviews. Rather than lawsuits themselves, the report says, the law's vague language requiring "significant" environmental effects to be mitigated is contributing to regulatory uncertainty among developers.

An industry representative maintained the connection between the environment and economy is valid.

"This is bread and butter," said Loren Kaye, president of the California Foundation for Commerce and Education, a think tank associated with the California Chamber of Commerce. "This is a foundational issue to talk with people who are interested in the state's economic recovery and competitiveness."

The 39 newly elected members of the state Legislature also make it a ripe time for reform, Kaye said.

"You've got a lot of newly elected members who may not be as bought into the status quo as the people they've replaced," he said. "Most of the new members and a lot of the returning members of the Legislature ran on economic improvement, ran on job creation, ran on these issues. This is a perfect issue for people to be concerned about."

David Pettit, a senior attorney for the Natural Resources Defense Council who has been participating in CEQA talks, said he hopes to get a legislative fix to a state court decision last year that found a Los Angeles developer did not have to account under CEQA for the environmental effects of sea-level rise on a real estate project.

"I'm in general an optimistic guy," Pettit said, "but I think we probably will get some changes that make CEQA easier to use without throwing out what's good about it."

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