No CEQA Required When Agencies Adopt Citizen Sponsored Initiatives

The California Supreme Court unanimously ruled that when a city council or county board of supervisors adopts a citizen-sponsored land use initiative, rather than placing it on the ballot, it need not comply with the California Environmental Quality Act (CEQA).

Tuolumne Jobs & Small Business Alliance v. Superior Court  (Cal. Supreme Court Case. No. S207173) involved the proposed 27,000 square-foot expansion of a Wal-Mart store in the City of Sonora.  The new Wal-Mart “Supercenter” would sell groceries and be open 24 hours every day.  The City prepared and circulated a draft environmental impact report (EIR) for the expansion, and the City’s planning commission unanimously recommended that the EIR be certified and the project approved.

However, before the project was called for a vote, the City Council was served with a notice of intent to circulate an initiative petition adopting a specific plan for the expansion in order to streamline approval of the Supercenter.  The Council postponed its vote while the initiative petition circulated.

The petition was ultimately signed by more than 20 percent of the City’s voters.  The Council ordered (pursuant to Elections Code section 9212) a report be prepared to examine the initiative’s consistency with previous approvals for the expansion.  At its next meeting, the Council reviewed the report and adopted the initiative.  The draft EIR was never certified.

A suit was filed asserting that the Council violated CEQA by adopting the initiative without first conducting a complete environmental review.  The trial court dismissed the claim, but the court of appeal reversed and held that full CEQA review is required before a city council adopts a citizen-sponsored land use initiative rather than submit it to an election. It expressly disagreed with the only published authority on point, Native American Sacred Site & Environmental Protection Assn. v. City of San Juan Capistrano (2004) 120 Cal.App.4th 961.  The Supreme Court then granted review.

The Supreme Court reviewed the Elections Code procedures regarding citizen-sponsored initiatives and noted the strict constraints in time and action placed on cities and counties when presented with a qualifying initiative petition.  When a local body receives an initiative petition signed by at least 15 percent of the city’s registered voters, it must: (1) adopt the initiative, without alteration, within 10 days after the petition is presented; (2) immediately submit the initiative to a vote at a special election; or (3) order a report pursuant to section 9212.  (Elec. Code § 9214.)  The report may examine the proposed initiative’s effects on land use, infrastructure, and any other matters the legislative body requests be included.  However, if ordered, the report must be prepared and presented within 30 days after the petition was certified and the legislative body must either adopt the initiative or order an election within 10 days after receiving the report.

The Court noted that it is well established that CEQA compliance is not required before a legislative body submits an initiative to voters under Elections Code section 9214(b), citing DeVita v. County of Napa (1995) 9 Cal.4th 763, 793-795.  The Court posed the question at issue as “whether the result should be different in the direct adoption context. That is, must the legislative body obtain full CEQA review before it may directly adopt a voter initiative under section 9214(a)?”  The answer is no, the Court concluded, because “CEQA review is contrary to the statutory language and legislative history pertaining to voter initiatives, and because policy considerations do not compel a different result.”  A section 9212 report is the exclusive means for assessing the potential environmental impact of such initiatives, the Court said, and such a report is optional under the Elections Code.

The Court noted that the language of section 9214 makes no mention of CEQA and that requiring CEQA review before direct adoption would essentially nullify other portions of section 9214 since full CEQA compliance could not occur within the mandatory statutory deadlines for required action.  “[I]f prior CEQA review is required, a city could never adopt a voter initiative under section 9214(a) if that initiative had any potential impact on the environment.  Direct adoption would be severely curtailed and, for many initiatives, no longer an option, because it would be impossible for cities to comply with both CEQA and the section 9214 deadlines.”

The Court looked at legislative history and noted that when CEQA was enacted in 1970, the statutory procedures for enacting voter initiatives had been in place for nearly 60 years and the Legislature showed no intention to require CEQA review before direct adoption of citizen-sponsored initiatives.  It also found that legislative attempts to require CEQA review in this context had been repeatedly rejected.

The Court also recognized that, even if time constraints permitted it, there were practical shortcomings of requiring CEQA review.  Since section 9214 requires that local governments either adopt qualified initiatives or submit them to voters “without alteration,” cities would be powerless to reject the proposed project or to require alterations in the project that would lessen its environmental impact, no matter what the review showed.  Moreover, initiatives adopted by a local government or voters may not be repealed or amended except by vote of the people, unless the initiative provides otherwise.

The appellants warned that developers could potentially use the initiative process to evade CEQA review, and direct adoption by a friendly city council could be used to avoid the need for an election.  While true, the Court noted that it is a two-way street since the initiative power may also be used to thwart development.  It concluded that “[t]he process itself is neutral.  The possibility that interested parties may attempt to use initiatives to advance their own aims is part of the democratic process.”

The Supreme Court previously ruled in friends of Sierra Madre v. City of Sierra Madre (2001) 25 Cal.4th 165, 191, that local agencies must comply with CEQA before placing a city-council-generated land use initiative on the ballot.  That ruling was not affected by the decision in Tuolumne Jobs.

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