BILL ANALYSIS Ó
SB 734
Page 1
SENATE THIRD READING
SB
734 (Galgiani)
As Amended June 21, 2016
2/3 vote. Urgency
SENATE VOTE: 37-0
------------------------------------------------------------------
|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Natural |9-0 |Williams, Dahle, | |
|Resources | | | |
| | | | |
| | |Cristina Garcia, | |
| | |Hadley, Harper, | |
| | |McCarty, Rendon, Mark | |
| | |Stone, Wood | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Appropriations |17-0 |Gomez, Bigelow, | |
| | |Bloom, Bonta, | |
| | |Calderon, Chang, | |
| | |Gordon, Eggman, | |
| | |Gallagher, Eduardo | |
| | |Garcia, Holden, | |
| | |Jones, Quirk, Rendon, | |
| | |Wagner, Weber, Wood | |
SB 734
Page 2
| | | | |
|----------------+-----+----------------------+--------------------|
|Natural |5-3 |Williams, Cristina |Jones, Harper, Mark |
|Resources | |Garcia, Gomez, |Stone |
| | |McCarty, Wood | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Appropriations |14-5 |Gonzalez, Bloom, |Bigelow, Gallagher, |
| | |Bonilla, Bonta, |Jones, Obernolte, |
| | |Calderon, Daly, |Wagner |
| | |Eggman, Eduardo | |
| | |Garcia, Roger | |
| | |Hernández, Holden, | |
| | |Quirk, Santiago, | |
| | |Weber, Wood | |
| | | | |
| | | | |
------------------------------------------------------------------
SUMMARY: Extends for two years the expedited California
Environmental Quality Act (CEQA) judicial review procedures
established by the Jobs and Economic Improvement Through
Environmental Leadership Act (AB 900 (Buchanan), Chapter 354,
Statutes of 2011). Specifically, this bill:
1)Extends the operation of AB 900 by two years, so that the
Governor must certify a project prior to January 1, 2018, the
project must be approved prior to January 1, 2019, and AB 900
sunsets January 1, 2019.
2)Adds the following prevailing wage conditions and enforcement
provisions:
a) Requires contractors and subcontractors to pay to all
construction workers employed in the execution of the
SB 734
Page 3
project at least the general prevailing rate of per diem
wages.
b) Provides that this obligation may be enforced by the
Labor Commissioner through the issuance of a civil wage and
penalty assessment pursuant to relevant provisions of the
Labor Code, unless all contractors and subcontractors
performing work on the project are subject to a project
labor agreement that requires the payment of prevailing
wages and provides for enforcement through an arbitration
procedure.
3)Requires a multifamily residential project certified under AB
900 to provide unbundled parking, such that private vehicle
parking spaces are priced and rented or purchased separately
from dwelling units, except for units subject to affordability
restrictions in law that prescribe rent or sale prices, where
the cost of parking spaces cannot be unbundled from the cost
of dwelling units.
EXISTING LAW:
1)Pursuant to CEQA, requires a lead agency with the principal
responsibility for carrying out or approving a proposed
discretionary project to evaluate the environmental effects of
its action and prepare a negative declaration, mitigated
negative declaration, or environmental impact report (EIR).
If an initial study shows that the project may have a
significant effect on the environment, the lead agency must
prepare an EIR. CEQA authorizes judicial review of 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. The
SB 734
Page 4
courts are required to give CEQA actions preference over all
other civil actions.
2)Pursuant to AB 900, establishes procedures for expedited
judicial review (i.e., requiring the courts to resolve
lawsuits within 270 days) for "environmental leadership"
projects certified by the Governor and meeting specified
conditions, including Leadership in Energy and Environmental
Design (LEED) silver-certified infill site projects, clean
renewable energy projects, and clean energy manufacturing
projects.
a) Defines "environmental leadership" project as a CEQA
project that is one of the following:
i) A residential, retail, commercial, sports, cultural,
entertainment, or recreational use project that is
certified as LEED silver or better by the United States
Green Building Council and, where applicable, that
achieves a 10% greater standard for transportation
efficiency than for comparable projects.
(1) Requires that these projects be located on an
infill site.
(2) Requires a project that is within a
metropolitan planning organization for which a
sustainable communities strategy (SCS) or alternative
planning strategy (APS) is in effect, to be consistent
with specified policies in either the SCS or APS,
which, if implemented, would achieve greenhouse gas
emission (GHG) reduction targets.
ii) A clean renewable energy project that generates
electricity exclusively through wind or solar, but not
including waste incineration or conversion.
iii) A clean energy manufacturing project that
manufactures products, equipment, or components used for
renewable energy generation, energy efficiency, or for
the production of clean alternative fuel vehicles.
SB 734
Page 5
b) Allows a person proposing to construct a leadership
project to apply to the Governor for certification that the
leadership project is eligible for streamlining. Requires
the person to supply evidence and materials that the
Governor deems necessary to make a decision on the
application. Requires any evidence or materials be made
available to the public at least 15 days before the
Governor certifies a project pursuant to AB 900.
c) Authorizes the Governor to certify a leadership project
if the Governor finds the project meets all of the
following conditions:
i) The project will result in a minimum investment of
$100 million in California upon completion of
construction.
ii) The project creates high-wage, highly skilled jobs
that pay prevailing wages and living wages, provides
construction jobs and permanent jobs for Californians,
and helps reduce unemployment.
iii) The project does not result in any net additional
GHG emissions, including emissions from employee
transportation, as determined by the Air Resources Board
pursuant to the California Global Warming Solutions Act
of 2006.
iv) The project applicant has entered into a binding and
enforceable agreement that all mitigation measures
required under CEQA shall be conditions of approval of
the project, and those conditions will be fully
enforceable by the lead agency or another agency
designated by the lead agency. In the case of
environmental mitigation measures, the applicant agrees,
as an ongoing obligation, that those measures will be
monitored and enforced by the lead agency for the life of
SB 734
Page 6
the obligation.
v) The project applicant agrees to pay the costs of the
Court of Appeal in hearing and deciding any case,
including payment of the costs for the appointment of a
special master if deemed appropriate by the court, in a
form and manner specified by the Judicial Council.
vi) The project applicant agrees to pay the costs of
preparing the administrative record for the project
concurrent with review and consideration of the project
pursuant to CEQA, in a form and manner specified by the
lead agency for the project.
d) Requires the Governor, prior to certifying a project, to
make a determination that each of the conditions specified
above has been met. These findings are not subject to
judicial review.
e) If the Governor determines that a leadership project is
eligible for streamlining, requires the Governor to submit
that determination, and any supporting information, to the
Joint Legislative Budget Committee (JLBC) for review and
concurrence or non-concurrence.
f) Requires the JLBC to concur or non-concur in writing
within 30 days of receiving the Governor's determination.
g) Deems the leadership project certified if the JLBC fails
to concur or non-concur on a determination by the Governor
within 30 days of the submittal.
h) Authorizes the Governor to issue guidelines regarding
application and certification of projects pursuant to AB
SB 734
Page 7
900. These guidelines are not subject to the rulemaking
provisions of the Administrative Procedure Act.
i) Requires the Judicial Council to adopt a rule of court
to establish procedures that require resolution within 270
days, including any appeals, of a lawsuit challenging the
certification of the EIR or any project approvals for a
certified environmental leadership project.
j) Prohibits AB 900 from applying to a leadership project
if the applicant fails to notify a lead agency prior to the
release of the draft EIR for public comment.
aa) Sets requirements for preparation and certification of
the administrative record for a leadership project
certified by the Governor.
bb) Requires the draft and final EIR to include a specified
notice in no less than 12-point type regarding the draft
and final EIR being subject to AB 900.
cc) Provides that provisions of AB 900 are severable.
dd) Provides that nothing in AB 900 affects the duty of any
party to comply with CEQA, except as otherwise provided in
AB 900.
ee) Prohibits AB 900 from applying to a leadership project
if the Governor does not certify the project prior to
January 1, 2016.
SB 734
Page 8
ff) Provides that certification of the leadership project
expires and is no longer valid if the lead agency fails to
approve the project prior to January 1, 2017.
gg) Requires the Judicial Council to report to the
Legislature on or before January 1, 2017, on the effects of
AB 900 on the administration of justice.
hh) Sunsets January 1, 2017.
FISCAL EFFECT: According to the Assembly Appropriations
Committee, absorbable state costs.
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.
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. 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.
SB 734
Page 9
CEQA actions taken by public agencies can be challenged in
Superior Court once the agency approves or determines to carry
out the project. CEQA appeals are subject to unusually short
statutes of limitations. Under current law, court challenges of
CEQA decisions generally must be filed within 30 to 35 days,
depending on the type of decision. The courts are required to
give CEQA actions preference over all other civil actions. The
petitioner must request a hearing within 90 days of filing the
petition and, generally, briefing must be completed within 90
days of the request for hearing. There is no deadline specified
for the court to render a decision.
In 2011, AB 900 and SB 292 (Padilla), Chapter 353, Statutes of
2011, established expedited CEQA judicial review procedures for
a limited number of projects. For AB 900, it was large-scale
projects meeting extraordinary environmental standards and
providing significant jobs and investment. For SB 292, it was a
proposed downtown Los Angeles football stadium and convention
center project achieving specified traffic and air quality
mitigations. For these eligible projects, the bills provided
for original jurisdiction by the Court of Appeal and a
compressed schedule requiring the court to render a decision on
any lawsuit within 175 days. This promised to reduce the
existing judicial review timeline by 100 days or more, while
creating new burdens for the courts and litigants to meet the
compressed schedule. AB 900's provision granting original
jurisdiction to the Court of Appeal was invalidated in 2013 by a
decision in Alameda Superior Court in Planning and Conservation
League v. State of California. The stadium project subject to
SB 292 has not proceeded. In 2013, SB 743 (Steinberg), Chapter
386, Statutes of 2013, established special CEQA procedures
modeled on SB 292 for the Sacramento Kings arena project. Like
SB 292, SB 743 applied to a single project and included
specified traffic and air quality mitigations. CEQA lawsuits
were filed against the Kings arena, and the lawsuits, including
appeals, were resolved 267 days after certification of the
record.
SB 734
Page 10
To date, six projects have been certified under AB 900. Only
one, the proposed Golden State Warriors arena and related
development at Mission Bay in San Francisco, has been challenged
under CEQA. The case, Mission Bay Alliance et al. v Office of
Community Investment and Infrastructure, was filed March 11,
2016. A hearing is scheduled June 17 in San Francisco Superior
Court.
The deadline for AB 900 certification under current law has
passed (it was January 1, 2016). The following six projects
were certified prior to AB 900's expiration:
1)McCoy Solar Energy Project in Riverside County.
2)Apple Campus 2 in Cupertino.
3)Soitec Solar Energy Project in San Diego County.
4)8150 Sunset Boulevard, a mixed-use commercial and residential
project in Hollywood.
5)Event Center and Mixed-Use Development at Mission Bay Blocks
(i.e., Warriors Arena) in San Francisco.
6)Qualcomm Stadium Reconstruction Project in San Diego.
To date, it appears that only the Apple Campus 2 has received
final approval and proceeded to construction as proposed.
SB 734
Page 11
Although this bill provides a blanket extension of AB 900 and is
not specific to any particular projects, proponents have
identified four projects that would apply for AB 900
certification if the bill is enacted:
1)6701 Sunset/Crossroads in Hollywood - Nine new mixed-use
buildings, including residential, hotel, commercial office,
retail, and restaurant uses, including up to 308 hotel rooms
and 950 residential units, 84 of which will be affordable to
low-income households (to replace 84 rent-controlled units the
project will demolish).
2)Yucca-Argyle Project in Hollywood - Mixed-use project with
hotel, residential, and commercial uses, including 260 hotel
rooms and 191 residential units, 39 of which will be
affordable to low-income households.
3)Barlow Hospital Project in Echo Park - Hospital replacement
and residential development on a 25-acre site near Dodgers
Stadium, including 400 new single-family homes, with no
commitments to affordable housing to date.
4)Hollywood Central Park - A 38-acre regional street level park
created by capping US 101 between Hollywood and Santa Monica
Boulevards.
It's an open question whether the idea of limiting the scope and
time of judicial review of favored projects was ever good
policy, even for one project. The practical benefit of this
approach to developers is debatable, and it's unclear whether
that benefit outweighs the potential sacrifice to effective
environmental review and the increased burden on the courts.
The only project that seems to have used and possibly benefited
from the judicial review procedures enacted since 2011 is the
SB 734
Page 12
Sacramento Kings arena project. It should be noted that SB 743
required the Kings arena to be certified LEED Gold, as well as
minimize traffic and air quality impacts through project design
or mitigation measures, including reducing to at least zero the
net GHG emissions from private automobile trips to the arena,
achieve reductions in GHG emissions from automobiles and light
trucks that will exceed the GHG emission reduction targets for
2020 and 2035 adopted for the Sacramento region pursuant to SB
375 (Steinberg), Chapter 728, Statutes of 2008 and achieve a 15%
reduction in vehicle-miles traveled (VMT) per attendee. In
contrast, AB 900 requires the lower LEED Silver certification, a
10% improvement in transportation efficiency over comparable
projects, and zero net GHG emissions, with no requirement that
the GHG emission reductions be from local sources.
Analysis Prepared by:
Lawrence Lingbloom / NAT. RES. / (916) 319-2092
FN:
0003525