BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                SB 731
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        SENATE THIRD READING
        SB 731 (Steinberg)
        As Amended  August 6, 2013
        Majority vote 

         SENATE VOTE  :39-0  
         
         NATURAL RESOURCES   6-1         LOCAL GOVERNMENT    7-0         
         
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        |Ayes:|Chesbro, Garcia,          |Ayes:|Achadjian, Levine, Alejo, |
        |     |Muratsuchi, Skinner,      |     |Bradford, Gordon, Mullin, |
        |     |Stone, Williams           |     |Rendon                    |
        |     |                          |     |                          |
        |-----+--------------------------+-----+--------------------------|
        |Nays:|Patterson                 |     |                          |
        |     |                          |     |                          |
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         APPROPRIATIONS      11-0                                        
         
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        |Ayes:|Gatto, Bocanegra,         |     |                          |
        |     |Bradford,                 |     |                          |
        |     |Ian Calderon, Campos,     |     |                          |
        |     |Eggman, Gomez, Hall, Pan, |     |                          |
        |     |Quirk, Weber              |     |                          |
        |-----+--------------------------+-----+--------------------------|
        |     |                          |     |                          |
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         SUMMARY  :  Makes various clarifications and revisions to the  
        California Environmental Quality Act (CEQA), including limiting the  
        scope of review for certain residential, mixed-use, and commercial  
        "employment center" projects near existing or planned transit stops.  
         Specifically,  this bill  :

        1)Requires the Governor's Office of Planning and Research (OPR), on  
          or before July 1, 2014, to propose revisions to the CEQA  
          Guidelines to establish thresholds of significance (to determine  
          if an environmental effect justifies preparation of an  
          environmental impact report) for noise and transportation impacts  
          of residential, mixed-use residential, or employment center  
          projects on infill sites within transit priority areas.  Requires  
          the thresholds to be based upon a project's proximity to a  
          multi-modal transportation network, its overall transportation  








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          accessibility, and its proximity to a diversity of land uses.

           a)   Defines "employment center project" as a project located on  
             property zoned for commercial uses, with a floor area ratio of  
             no less than 0.75, located within a transit priority area.

           b)   Defines "infill site" as a lot located within an urban area  
             that has been previously developed, or on a vacant site  
             surrounded by parcels developed with qualified urban uses.

           c)   Defines "transit priority area" as an area within one-half  
             mile of a major transit stop that is either existing or  
             planned, if the planned stop is scheduled to be completed  
             within the planning horizon of a specified federal  
             transportation plan.

           d)   Provides that aesthetic and parking impacts of projects  
             subject to this section shall not be considered significant  
             impacts on the environment for purposes of CEQA, while also  
             stating that the authority of a lead agency to consider  
             aesthetic impacts pursuant to local design review ordinances or  
             other discretionary powers in not affected.  

        2)For purposes of the existing exemption for a residential  
          development project that is consistent with a specific plan for  
          which an EIR has been prepared, clarifies that "new information"  
          which would invalidate the exemption does not include "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 not caused by,  
          physical impacts on the environment" (making the meaning of "new  
          information" consistent with the existing meaning of "substantial  
          evidence" in CEQA).  

        3)Requires, when a public agency finds that specific economic,  
          legal, social, technological, or other considerations make  
          infeasible the mitigation measures or alternatives identified in  
          the EIR and finds that specific overriding economic, legal,  
          social, technological, or other benefits of the project outweigh  
          the significant effects on the environment, that the agency's  
          findings be published for review for at least 15 days prior to  
          approval of the project, and provides specified procedures for  
          publication and transmittal to specified parties.   









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        4)Requires a lead agency to prepare and publish an annual report on  
          a project's compliance with mitigation measures adopted pursuant  
          to CEQA.  

        5)Provides that the statute of limitations for bringing a CEQA  
          lawsuit may be tolled for successive periods up to four years each  
          by agreement of the parties (petitioner, public agency and real  
          party in interest/applicant).  

        6)For certain projects and upon a project applicant's request,  
          authorizes a lead agency to prepare concurrently with the  
          administrative process the record of proceedings that would be  
          used in a judicial challenge to an agency's action or decision  
          under CEQA.  Specifies procedures for preparation and publication  
          of the record.  Requires the project applicant to reimburse the  
          lead agency for the costs incurred to prepare the record.  Applies  
          to projects determined to be of statewide, regional, or area-wide  
          environmental significance; infill projects for which an EIR was  
          certified for a city or county's planning level decision; a  
          project implementing a sustainable communities strategy pursuant  
          to SB 375 (Steinberg), Chapter 728, Statutes of 2008; or any other  
          project for which the lead agency consents to prepare the record  
          of proceedings pursuant to the above requirements.  

        7)Requires the Attorney General to report annually to the  
          Legislature regarding CEQA lawsuits, including the parties  
          involved, the type of action and violation alleged, and the  
          disposition of the case.  

        8)Requires, when a court finds that a public agency has not complied  
          with CEQA, that the court issue a peremptory writ of mandate  
          specifying what action is necessary to comply.  Requires the writ  
          include only those mandates necessary to achieve compliance and  
          only those project activities in noncompliance, and permits a writ  
          to direct the agency to revise only those portions of a CEQA  
          document found not to be in compliance, provided the non-compliant  
          issues are severable from the remainder of the project.  

        9)Declares the intent of the Legislature to appropriate $30 million  
          to the Strategic Growth Council to provide competitive grants to  
          local agencies for planning activities related to implementing SB  
          375.  

        10)Authorizes the applicant for a renewable energy project to  








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          present to the public agency the onsite or offsite benefits of the  
          project.  

        11)Establishes, until January 1, 2017, the position of "Advisor on  
          Renewable Energy Facilities" in the office of the Governor.  

        12)Declares the intent of the Legislature regarding CEQA issues  
          addressed in the operative provisions of the bill.  

        13)Titles the bill the "CEQA Modernization Act of 2013."

         EXISTING LAW  :

        1)Requires, under CEQA, lead agencies with the principal  
          responsibility for carrying out or approving a proposed 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).

        2)Requires an EIR to identify and analyze:

           a)   Significant effects on the environment that would occur if  
             the project is approved, unless the agency finds that  
             alternatives to the project or mitigation measures would  
             address the effects, or specific overriding economic, legal,  
             social, technological, or other benefits of the project  
             outweigh them.

           b)   Cumulative impacts of a project when, considered in the  
             context of environmental change occurring over time, the  
             incremental effect is cumulatively considerable.

        3)Exempts from CEQA specified residential housing projects which  
          meet criteria established to ensure the project does not have a  
          significant effect on the environment, including urban infill  
          housing projects not more than 100 units on a site not more than  
          four acres in size which is within one-half mile of a major  
          transit stop.  (SB 1925 (Sher), Chapter 1039, Statutes of 2002)

        4)Establishes abbreviated CEQA review procedures for specified  
          infill projects, where only specific or more significant effects  
          on the environment which were not addressed in a prior  








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          planning-level EIR need be addressed.  An EIR for such a project  
          need not consider alternative locations, densities, and building  
          intensities or growth-inducing impacts.  Infill projects may  
          include residential, retail, commercial, transit station, school,  
          or public office building projects located within an urban area.   
          Requires OPR to develop CEQA guidelines, including statewide  
          standards to promote smart growth, reduction of greenhouse gas  
          (GHG) emissions, reduction in water use, energy efficiency  
          improvements and protection of public health.  (SB 226 (Simitian),  
          Chapter 469, Statutes of 2011)

        5)Requires metropolitan planning organizations to include a  
          sustainable communities strategy (SCS), as defined, in their  
          regional transportation plans, or an alternative planning strategy  
          (APS), for the purpose of reducing GHG emissions, aligns planning  
          for transportation and housing, and creates specified incentives  
          for the implementation of the strategies, including CEQA exemption  
          or abbreviated review for eligible residential projects.  (SB 375  
          (Steinberg), Chapter 728, Statutes of 2008)  

        6)Authorizes judicial review of CEQA actions taken by public  
          agencies, following the agency's decision to carry out or approve  
          the project.  Challenges alleging improper determination that a  
          project may have a significant effect on the environment, or  
          alleging an EIR doesn't comply with CEQA, must be filed in the  
          Superior Court within 30 days of filing of the notice of approval.  
           

        7)Establishes that a record of proceeding includes, but is not  
          limited to, all application materials, staff reports, transcripts  
          or minutes of public proceedings, notices, written comments, and  
          written correspondence prepared by or submitted to the public  
          agency regarding the proposed project.  Establishes a procedure  
          for the preparation, certification, and lodging of the record of  
          proceedings.  

         FISCAL EFFECT  :  According to the Assembly Appropriations Committee,  
        one-time General Fund (GF) costs to OPR of approximately $500,000 to  
        develop threshold standards for noise, transportation, and parking  
        impacts.  Ongoing GF costs of approximately $120,000 for the  
        creation of the Advisor on Renewable Energy Facilities within the  
        Office of the Governor.  GF cost pressure of $30 million for local  
        assistance grants for planning activities administered by the  
        Strategic Growth Council.  Unknown cost pressures for the California  








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        Research Bureau to report annually.

         COMMENTS  :  CEQA provides a process for evaluating the environmental  
        effects of applicable projects undertaken or approved by public  
        agencies.  If a project is not exempt from CEQA, an initial study is  
        prepared to determine whether the 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 may have a significant effect on the  
        environment, the lead agency must prepare an EIR.  A lead agency  
        must base its determination of significant effects on substantial  
        evidence.

        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 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.

        According to the author's office, this bill 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 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."
         

        Analysis Prepared by  :    Lawrence Lingbloom / NAT. RES. / (916)  
        319-2092 


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