BILL ANALYSIS
AB 696
Page 1
Date of Hearing: April 27, 2009
ASSEMBLY COMMITTEE ON NATURAL RESOURCES
Nancy Skinner, Chair
AB 696 (Hagman) - As Amended: April 16, 2009
SUBJECT : California Environmental Quality Act (CEQA):
arbitration
SUMMARY : Permits an applicant and a lead agency to agree to
resolve disputes arising from an environmental impact report
(EIR) through private arbitration, in lieu of seeking judicial
review.
EXISTING LAW requires lead agencies with the principal
responsibility for carrying out or approving a proposed project
to prepare a negative declaration, mitigated negative
declaration, or EIR for this action, unless the project is
exempt from CEQA. CEQA provides appeal procedures for parties
to challenge lead agency decisions in court.
THIS BILL :
1)Permits an applicant and a lead agency to agree to resolve
disputes arising from an EIR through private arbitration, in
lieu of retaining their right to seek judicial review before a
public judge applying CEQA, the rules of evidence and the
rules of civil procedure that are designed to ensure fairness
in the resolution of legal disputes.
2)Requires the applicant and lead agency to agree on the
arbitrator.
3)Provides the arbitration is binding on both parties.
4)Requires the arbitrator resolve the dispute within 90 days.
FISCAL EFFECT : Unknown.
COMMENTS :
1)Don't forget the public interest in CEQA decisions. This bill
would allow the applicant and agency to opt for arbitration as
to an agency's EIR decision. The bill requires both agency
and applicant to designate together an arbitrator at the time
AB 696
Page 2
the applicant opts for arbitration. The bill does not
indicate who the arbitrators will be, or whether they have any
experience or expertise with CEQA law, or what if any judicial
review would be allowed if arbitration fails to resolve the
dispute.
However, the applicant and lead agency are not the only
interested parties in the approval of an EIR. CEQA lawsuits
typically are filed by parties other than the applicant. It
is not clear whether the bill would still leave an interested
citizen free to challenge the agency's action in court.
Assuming citizens' rights to challenge CEQA decisions would
not be compromised by a deal struck between the applicant and
agency, this bill is unlikely to achieve the author's apparent
intent to decrease CEQA litigation.
In fact, the bill may have the effect of making the resolution
of CEQA disputes more complicated, lengthy and expensive.
Given that the bill as written does not seem to preclude
private citizen suits to challenge agency decisions, there
could be "satellite" public court litigation alongside private
arbitration, with additional costs and potentially conflicting
outcomes. The agency may therefore be forced to defend its
decision in two different fora, with increased financial and
time costs.
2)Private arbitration doesn't fit the purposes or circumstances
of public agency actions under CEQA. Clearly the purpose
behind CEQA is a public one, to protect the interests of all
Californians, and not just those of the project applicant and
the lead agency. CEQA compliance issues therefore may not be
well suited to private arbitration agreements which exclude
the general public's interests. While a party is free to
waive the advantage of a law intended for his or her benefit,
a law established for a public reason (here, the law that
allows for public court review of CEQA decisions) cannot be
waived by private agreement. (Civil Code section 3513.)
Moreover, mandatory and binding arbitration may be
particularly inappropriate for review of CEQA decisions, which
involve a highly complex area of the law and adherence to
court precedent. Importantly, one provision of CEQA provides,
"To ensure that actions or proceedings brought pursuant to
Sections 21167, 21168, and 21168.5 may be quickly heard and
determined in the lower courts, the superior courts in all
AB 696
Page 3
counties with a population of more than 200,000 shall
designate one or more judges to develop expertise in this
division and related land use and environmental laws, so that
those judges will be available to hear, and quickly resolve,
actions or proceedings brought pursuant to Sections 21167,
21168, and 21168.5." (Public Resources Code section
21167.1(b).) Clearly within CEQA itself there is recognition
that particular expertise is required to resolve CEQA
disputes, including knowledge of CEQA itself as well as
knowledge of other land use and environmental laws. Not only
is there no guarantee that a private arbitrator would have
such expertise, but even if he or she did, there is no
requirement that the arbitrator apply CEQA law and precedent
in resolving a dispute over an agency's decision.
REGISTERED SUPPORT / OPPOSITION :
Support
Civil Justice Association of California
Opposition
California Coastal Coalition
California League of Conservation Voters
Coalition for Clean Air
Sierra Club California
Natural Resources Defense Council
Planning and Conservation League
Analysis Prepared by : Lawrence Lingbloom / NAT. RES. / (916)
319-2092