BILL ANALYSIS                                                                                                                                                                                                    



                                                                SB 731
                                                                       

                      SENATE COMMITTEE ON ENVIRONMENTAL QUALITY
                              Senator Jerry Hill, Chair
                              2013-2014 Regular Session
                                           
           BILL NO:    SB 731
           AUTHOR:     Steinberg
           AMENDED:    April 23, 2013
           FISCAL:     Yes               HEARING DATE:     May 1, 2013
           URGENCY:    No                CONSULTANT:       Joanne Roy
            
           SUBJECT  :    CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) AND  
                          SUSTAINABLE COMMUNITIES STRATEGY

            SUMMARY  :    
           
            Existing law  , under the California Environmental Quality Act  
           (CEQA):

           1) Requires lead agencies with the principal responsibility  
              for carrying out or approving a proposed discretionary  
              project to prepare a negative declaration, mitigated  
              negative declaration, or environmental impact report (EIR)  
              for this action, unless the project is exempt from CEQA  
              (CEQA includes various statutory exemptions, as well as  
              categorical exemptions in the CEQA guidelines). (Public  
              Resources Code 21000 et seq.).  

           2) States the intent of the Legislature that "all agencies of  
              the state government which regulate activities of private  
              individuals, corporations, and public agencies which are  
              found to affect the quality of the environment, shall  
              regulate such activities so that major consideration is  
              given to preventing environmental damage, while providing a  
              decent home and satisfying living environment for every  
              Californian.  (PRC 21000).

           3) States the intent of the Legislature to "[t]ake all action  
              necessary to provide the people of this state with clean  
              air and water, enjoyment of aesthetic, natural, scenic, and  
              historic environmental qualities, and freedom from  
              excessive noise."  ((PRC 21001(b)).

           4) States the intent of the Legislature to "[e]nsure that the  









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              long-term protection of the environment, consistent with  
              the provision of a decent home and suitable living  
              environment for every Californian, shall be the guiding  
              criterion in public decision." (PRC 21001(d)).

           5) Exempts from CEQA, a residential development project that  
              is undertaken to implement, and is consistent with, a  
              specific plan for which an EIR has been certified.   
              Provides that this exemption does not apply if, after  
              certification of the EIR for the specific plan, a specified  
              event occurs (as described in PRC 21166), unless a  
              supplemental EIR for the specified plan is certified.   
              (Government Code 65457).

           6) Establishes the Strategic Growth Council to award grants  
              and loans for planning and developing sustainable  
              communities' strategies.  (Public Resources Code 75121).

           7) In making a finding of overriding considerations, requires  
              the public agency to base its finding on substantial  
              evidence in the record.  (PRC 21081.5). 

           8) Requires a public agency to adopt a reporting or monitoring  
              program of mitigation measures and ensure their  
              enforceability.  (PRC 21081.6).

           9) Defines "environment" as "the physical conditions which  
              exist within the area which will be affected by the  
              proposed project, including land, air, water, minerals,  
              flora, fauna, noise, objects of historic or aesthetic  
              significance."  (PRC 21060.5).

           10)Establishes a procedure for preparing and certifying the  
              record of proceedings for an action against a public agency  
              on the grounds of noncompliance with CEQA.  (PRC 21167).

           11)Establishes requirements for a court order for  
              noncompliance.  (PRC 21168.9).

            This bill  :  

           1) States the Legislature's intent to revise various  
              provisions in CEQA.









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           2) Establishes the position of Advisor on Renewable Energy  
              Facilities in the Governor's office and sunsets the  
              position on January 1, 2017.

           3) Expands the exemption for a residential development project  
              that is undertaken to implement a specific plan by  
              providing that "new information" triggering an  
              environmental review does not include "new information  
              consisting solely of argument, speculation, unsubstantiated  
              opinion or narrative, evidence that is clearly inaccurate  
              or erroneous, or evidence of social or economic impacts  
              that do not contribute to, or are caused by, physical  
              impacts on the environment." 

           4) Authorizes the appropriation of $30 million in the annual  
              state budget to the Strategic Growth Council for  
              Sustainable Communities Strategy project grants.

           5) Authorizes a renewable energy project applicant to present  
              to the public agency, orally or in writing, the benefits of  
              the project such as reducing traffic or improving air  
              quality.

           6) In making a finding of overriding considerations, requires  
              those findings to be made available in draft form for  
              review by the public at least 15 days prior to approval of  
              the proposed project.  Requires the lead agency to provide  
              notice of the draft findings through specified methods,  
              including electronically.

           7) Requires a lead agency to prepare an annual report on  
              project compliance with mitigation measures as part of the  
              mitigation monitoring plan.

           8) Provides that aesthetic impacts of a residential, mixed-use  
              residential, or employment center project, as defined,  
              within a transit priority area, as defined, shall not be  
              considered significant impacts on the environment.   
              Clarifies that this provision does not affect or change the  
              authority a lead agency's authority to consider aesthetic  
              impacts pursuant to local design review ordinances or other  
              discretionary powers.









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           9) Requires the Office of Planning and Research to prepare  
              revisions to the CEQA guidelines establishing thresholds of  
              significance for noise, and for transportation and parking  
              impacts on residential, mixed-use residential or employment  
              centers within transit priority areas.  Provides that this  
              provision does not affect the authority of a public agency  
              from establishing transportation or parking standards  
              applicable to projects requiring more stringent thresholds  
              of significance.

           10)Allows the statute of limitations for an action against a  
              public agency for noncompliance to be suspended, for a  
              maximum of four years, by mutual agreement of the parties.

           11)Requires a lead agency, at the request of a project  
              applicant, to prepare a record of proceedings concurrently  
              with the preparation of an environmental review document.   
              Requires all documents in the record of proceedings be  
              posted on the lead agency's Internet web site.

           12)Authorizes the statute of limitations to be suspended by  
              mutual agreement of the parties.  Provides that the period  
              of time for tolling may not exceed four years in such an  
              agreement but authorizes the extension of the tolling  
              period.

           13)Authorizes a court to direct an agency to revise only those  
              portions of a CEQA document found not to be in compliance  
              with CEQA and includes specific requirements to be met for  
              a court to do so.
            

           COMMENTS  :

            1) Purpose of Bill  .  According to the author, SB 731 is a  
              comprehensive reform measure to strengthen CEQA's  
              protection of the state's environment and residents while  
              modernizing the law to aid California's economic growth.  
              The author states, "today's bill is the result of months of  
              discussion and negotiation with key representatives from  
              the business, environmental, and organized labor  
              communities."  These changes were key issues identified by  









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              a CEQA working group of experts brought together by Senator  
              Steinberg this past fall.  The author states, "Taken  
              together they will help reduce litigation and delays from  
              CEQA while protecting the legitimate uses of the statute." 

            2) Background on CEQA  .  Governor Reagan signed CEQA into law  
              in 1970.  Since then, 334 sections have been added, amended  
              or repealed since 1990; 170 sections since 2002; and 83  
              sections since 2008.

           For a better understanding of the types of CEQA documents and  
              the numbers of documents produced, the chart below by the  
              State Clearinghouse shows all CEQA documents filed with the  
              State Clearinghouse between 1999 and 2010.


                Key:
                NOP Notice of Preparation
                EIR Draft Environmental Impact Report
                ND/MND Negative Declaration/ Mitigated Negative  
                Declaration
                NOD Notice of Determination
                NOE Notice of Exemption
                EA Environmental Assessment (Federal)
                EIS Draft Environmental Impact Report (Federal)
                OTHER  Other types of documents, including Final EIRs,  
                Early Consultation Notices, plans, etc.

            3) CEQA:  The environmental review process  . A CEQA  
              environmental review document is a public document.  It  
              provides for transparency as well as an opportunity for  
              citizens to comment on the document and participate in the  
              environmental review process.  

           CEQA provides a process for evaluating the environmental  
              effects of a project, and includes statutory exemptions as  
              well as categorical exemptions in the CEQA guidelines.  If  
              a project is not exempt from CEQA, an initial study is  
              prepared to determine whether a project may have a  
              significant effect on the environment.  If the initial  
              study shows that there would not be a significant effect on  
              the environment, the lead agency must prepare a negative  
              declaration.  If the initial study shows that the project  









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              may have a significant effect on the environment, then the  
              lead agency must prepare an EIR.

           Generally, an EIR must accurately describe the proposed  
              project, identify and analyze each significant  
              environmental impact expected to result from the proposed  
              project, identify mitigation measures to reduce those  
              impacts to the extent feasible, and evaluate a range of  
              reasonable alternatives to the proposed project.  Prior to  
              approving any project that has received an environmental  
              review, an agency must make certain findings.  If  
              mitigation measures are required or incorporated into a  
              project, the agency must adopt a reporting or monitoring  
              program to ensure compliance with those measures.

           If a mitigation measure would cause one or more significant  
              effects in addition to those that would be caused by the  
              proposed project, the effects of the mitigation measure  
              must be discussed but in less detail than the significant  
              effects of the proposed project.

            4) CEQA litigation  . Enforcement of CEQA is primarily through  
              citizens' lawsuits challenging a project's environmental  
              review in court.  Some contend that CEQA litigation delays,  
              if not kills, projects and that vexatious litigation  
              abounds.  However, the total number of CEQA cases filed is  
              actually quite small, averaging only about 200 cases per  
              year statewide.  CEQA cases make up 0.02% of 1,100,000  
              civil cases filed annually in California.  In addition, the  
              California Attorney General's office conducted a case study  
              of CEQA challenges in the City and County of San Francisco  
              from July 2011 through December 2011 and found that 18  
              lawsuits were filed out of 5,203 projects considered under  
              CEQA.  However, some parties argue that the simple threat  
              of a lawsuit is an impetus for extra costs and delays of a  
              project subject to environmental review.

           To address litigious concerns, this bill authorizes, among  
              other things, the following: concurrent preparation of a  
              record of proceedings with the preparation of an  
              environmental review document to reduce litigation delays,  
              the statute of limitations to be tolled by mutual agreement  
              of the parties to facilitate settlements, and partial  









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              remand by the court directing an agency to revise only  
              those portions of a CEQA document not in compliance.  In  
              addition, SB 731 provides that for specified projects,  
              aesthetic impacts are not considered significant impacts  
              under CEQA and directs OPR to develop uniform thresholds of  
              significance for noise, and transportation and parking  
              impacts of specified projects in transit priority areas.

            5) Amendments  .  The author proposes to add the following  
              amendments:

              a)    Request the Department of Justice to report annually  
                 to the Legislature on CEQA litigation in order to  
                 provide reliable and unbiased information regarding CEQA  
                 lawsuits.

              b)    Provide that funds for appropriating the $30 million  
                 for Sustainable Communities Strategy project grants may  
                 come from cap and trade revenues, AB 118 funds, or other  
                 sources as determined in the annual budget.


            SOURCE  :        Author  

           SUPPORT  :       California Association of Realtors  

           OPPOSITION  :    None on file