Jason Barre and Kevin KlowdenOctober 2016

Fixing the Flaws in a Good Law

2

Table of Contents

I.Introduction........................................................................................................3

II.CEQA as a Weapon ……………………………………...................................................4

III.CEQA as a Savior............................................................................................8

IV.CEQA Exemptions: A Broken Tool………….………………………….....................9

V.Recent Attempts at Reform………………………………………………………………….….10

VI.Recommendations……………………………………..................................................11

VII.Conclusion……………………………………...............................................................12

About the Authors……………………………………….....................................................13

3

I. Introduction Californiaisthethird-largeststatebyacreageandthemostpopulous.Itisinthetop20inannualpopulationgrowth.Astatewiththesestatisticsissuretoseeregionaldifferences,bothintermsofcultureandindustry.However,thereisoneaspectofCalifornialifethatallresidents,northandsouth,inlandandcoastal,enjoy:stunningnaturalbeauty.

FromSouthernCalifornia’sendlessbeachesandnear-constantsunshinetoNorthernCalifornia’slushforestsandpicturesquebays,thestate’senvironmentisoneofitsmostattractiveattributes.Asaresult,it’snosurprisethatmanyeffortshavebeenmadetoensuretheconservationofthatenvironment.

Onesucheffort,andperhapsthemostfar-reaching,istheCaliforniaEnvironmentalQualityAct,orCEQA.

CEQA’soriginscanbelinkedtopassageoftheNationalEnvironmentalPolicyAct(NEPA)of1969.ManyinCaliforniafeltthatNEPAdidnotgofarenoughtoaddressspecificenvironmentalprotectionconcernsinthestate,andacommitteewasformedtodiscusssupplementallegislation.TheresultwasCEQA,whichwassignedintolawbyGov.RonaldReaganin1970.

OneofthemostimportantprovisionsofCEQAistherequirementofanEnvironmentalImpactReport(EIR)onmostnewconstructionprojectstoanalyzethepotentialenvironmentaleffectsconstructionmighthaveonthearea.

But,besidesgivinglocalauthoritiesvaluableinformationaboutthepotentialeffectofaproject,theEIRalsoactsasavehicletofilecostlylawsuitsforreasonsfarlessnoblethanenvironmentalstewardship.

Sinceitspassage,CEQAhasbecometheprimarytoolforenvironmentalconcernsaroundthestatetolegallychallengedevelopmentthatmaydodisproportionateharmtosurroundingecosystems.Thegoalofpro-environmentCEQAlawsuitsisrarelytohaltconstructionaltogetherbutrathertobuildinawaythatminimizesthehumanfootprintandprotectslocalplantsandwildlife.HundredsofsuccessstoriescanbetracedtotheuseofCEQAtomitigateaproject’seffectonthestate’snaturalresources.

CEQAalsogivesavoicetothepublicindefendingtheenvironmentofitscommunities.CEQAlawsuitsareavehicleforlocalentities,bothpublicandprivate,todemandstrictenvironmentalreviewofnewconstructionintheirareas.Unrestricteddevelopmentcanharmalocalecosystemaswellasincreasetheriskofenvironmentaldamagetomuchlargernaturalareas.

However,CEQAhasbecomeafavoritetargetofthestate'sbusinesscommunitybecauseoftherequirementthatissuesraisedintheEIRmustbemitigatedbeforedevelopmentcanbegin.Thelawhasprovidedatoolforthoseseekingtoprotectourstate’secosystemstoensurethatnewdevelopmentdoesnotdestroyoneofCalifornia’smostvaluableresources.

ThereisnogovernmententityspecificallyempoweredbythelawtoenforceCEQA,solitigationinitsnameisusuallyfiledbyprivateparties.ManyofthesepartiesaroundthestateseeCEQAlawsuitsasanopportunitytohurtcompetition,advanceNIMBYism,andflatoutcashin.Asaresult,thereisverylittle

4

precedentandacceptedprotocolfordealingwithCEQAlitigation,andmostcasesaregenerallydecidedonaone-offbasis.

Inaddition,thedelaysassociatedwithCEQAlawsuitshavebecomeweaponsinandofthemselves,withmanyprojectsbeingshutdownratherthanspendingthetimeandmoneynecessarytobattletheselawsuits.Theeffectofthisontheabilitytoaddresskeysocialandevenenvironmentalconcernshasbecomeincreasinglyapparent.CEQAhasactuallybeenusednotonlytoblocknewandinnovativeenvironmentalprojects,butithasalsobecomeakeyfactorinconstrainingthehousingmarket.1

Reformsareneededtoencouragegrowthandaddressthecripplinghousingandinfrastructurecrisesourstatefaces.CEQAmustremainatoolforeffectiveenvironmentalprotection,butitshouldbeamendedtoallowforincreasedtransparencyandreducedinstancesofabuse.RatherthanattemptingtobypassorremoveCEQA,itisessentialtomaketheactmorepredictable,efficient,andreliablesothatitwillnotonlyservetobenefittheenvironmentbutalsoworktoaddwell-payingjobsandreasonablypricedhomesforCalifornia’sbeleagueredmiddleclass.

ThispaperwillprovideanoverviewofhowCEQAisused,bothforitsintendedpurposeandforlessbenignmotives,andprovidekeyrecommendationsforstreamliningthelawtoreduceabuses.

II. CEQA as a Weapon ByfarthemostcommoncomplaintaboutCEQAisitsfrequentuseasahammertoaccomplishanynumberofobjectivesthathavelittleornothingtodowithprotectingtheenvironment.ByfilingalawsuitagainstaconstructionprojectunderCEQA,litigantscanforcedelays,increasecosts,andoftenevengetprojectscanceled.Butwhobenefitsfromtheselawsuits? BusinessOwnersCompetitionisoneoftheriskiestaspectsofowningabusiness.AsCEQAlawsuitsbecamemorecommon,entrepreneursfoundthemtobeaneffectivetooltocausedelaysandincreasecostsforpotentialcompetitors.

CAMPUSRIVALRYFrom2003to2008,theUniversityofSouthernCaliforniaandadeveloper,UrbanPartners,foughtacostly,lengthylegalbattleoveraproposedmixed-useprojectnearitsLosAngelescampus.Acompetingdeveloper,ConquestHousing,filedmultiplelawsuitsunderCEQAagainsttheproposal’sEIR,specificallytargetingthenumberofproposedparkingspacesnexttothebuilding.Althoughtheprojectwasultimatelyapproved,andConquest’slawsuitsdismissed,thelegalfeesanddelaysassociatedwiththelawsuitsendangeredtheprojectwhentherewasnoclearenvironmentalthreat.2

1http://www.milkeninstitute.org/publications/view/8162http://articles.latimes.com/2011/nov/14/local/la-me-development-ceqa-20111114

5

NIMBYistsMuchCEQAlitigationfallsunderthecategoryofsimpleNIMBYism(“Notinmybackyard”),inwhichresidentsofaneighborhoodopposedevelopmentforanumberofreasons,includingthedeleteriouseffectsofconstruction,perceiveddropsinlandvalue,andotherhyper-localconcerns.Ironically,thesesmall-pictureconcernsmayultimatelycausemoreharmtothelargerenvironmentbydenyinginfillconstructionandsteeringdevelopmentawayfromjobsandtransit,thusincreasingsprawlandencouragingmoreuseofprivatetransportation.

ThisargumentissummarizedbyEdGlaeser,economistandprofessoratHarvardUniversity:

“Iactuallydobelievethatalmostallenvironmentalistsaremotivatedbyrelativelybenignforcesandthey’retryingtodogoodfortheworld.…ButIdothinkthatinthesalespitch,inthepersuasionprocess,inevitablydecisionrulesgetsimplified.Inevitablywemovethingsdowntosoundbites,wemovethingsdowntosimpleimplications.Andsometimesthesejustmeanthatwegetresultsthatarelessthanperfect.Insomecases,wecangetresultsthatarecompletelythereverseofwhatwewanted.”3

CEQALawyersItisimpossibletotalkaboutCEQAbattleswithoutdiscussingthelegalteamsthatfightthem.Withover2,700CEQAlawsuitsfiledfrom2002to2015,itiseasytoseehowtheattorneysinthesefightsaremorethanhappytoseethemdragon,particularlythelawyerswhobillbythehour.

FIGURE1.ThenumberofCEQAlawsuitsfiled,2002-2015

Source:RoseFoundation

3http://freakonomics.com/podcast/why-bad-environmentalism-is-such-an-easy-sell-a-new-freakonomics-radio-podcast-2/

0

50

100

150

200

250

300

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

6

EnvironmentalistsEnvironmentalgroupsalsocommonlyopposeCEQAstreamliningefforts,thoughperhapsforlessnefariousreasonsthanbusinessowners,NIMBYists,andlawyers.TheseorganizationsseeCEQAastheirprimarytooltoreduceharmtothestate’senvironmentasaresultofnewconstruction.

TheenvironmentalistmovementinCaliforniadoesnotbelievethatthecaseagainstCEQAhasbeenmadebythestate’sbusinesscommunity.ArecentRoseFoundationstudyconcludesthattheissueofCEQAlitigationabuseisoverstated,andtherelativestabilityofthenumberofCEQAlawsuitsfiledovera14-yearperiod(Figure1),whilethestate'spopulationhassteadilyincreased,showsthatlitigationisnotproportionallyincreasing.4

Thereisalsoconcernintheenvironmentalcommunitythatanypotential“fix”totheproblemsexpressedbythebusinesscommunityrisksreducingtheeffectivenessofthelawforthosewhouseCEQAforlegitimateenvironmentalconcerns.Whilerecognizingtheneedforpolicyreformsthataddressthestate’shousingcrisis—namely,afocusonincreasinghousingdensityinurbanareasthatareclosetojobsandpublictransportation—theanswer,inenvironmentalists’eyes,isanX-Actoknife,notamachete.

Asaresultoftheseconcerns,environmentalistsaregenerallyunconvincedthatadditionalstreamliningmeasuresarenecessaryinthecontextoftheoverallgoodthelawdoesinprotectingthestate’snaturalbeautyandresources. UnionsOrganizedlaborisperhapsthemosteffectiveandmostpowerfulopponentofCEQAreform.Unionsfrequentlyusethethreat(or,insomecases,execution)oflawsuitsunderCEQAtoobtainmorefavorablelaboragreementsfromdevelopers.Unionsfeelthatbyforcingfavorableagreementsonafewprojects,ratherthanagreeingtoless-advantageouscontractsonseveralprojectsoronprojectsthatwouldexcludeunionmembersentirely,theyareabletomaintainconsistentqualityworkratherthansuccumbtothewagepressuresaffectingsomanyoftheircompatriots.

RIDINGONUNIONCONCESSIONSOneofthemorerecentexamplesofunionsusingCEQAasleverageoccurredlastyearwhentheInternationalBrotherhoodofElectricalWorkers(IBEW)suedKinkisharyoInternational,aJapanesemanufacturerthathadrecentlybeenawardedalargecontracttobuildtrainsforLosAngelesCounty.Aftermultiplelawsuitswerefiledundertheguiseofenvironmentalprotection,thefinalagreement,facilitatedbyLosAngelesMayorEricGarcetti,includedheavyconcessionstotheIBEW–includingallowingthecompany’sworkerstounionize–butdidnotincludeanymeaningfulchangestotheproject’simpactonthelocalenvironment.5

4http://rosefdn.org/wp-content/uploads/2016/08/CEQA-in-the-21st-Century.pdf5http://www.ocregister.com/articles/ceqa-718161-environmental-unions.html

7

ButthereareotherreasonsforunionentrenchmentontheissueofCEQAreform.Overallunionmembershipinthestatehasdecreasedsteadilysince20086inthefaceofanincreaseinindependentcontractors,design-buildentitiesthatofferone-stopshopsforconstructionprojects,andotherfactors.CEQAhelpstomaintainunions’impactinstateandlocalpolitics,andprovidesaneffectivemeansofsecuringwell-payingjobsformembers,evenasotherpressuressincetheGreatRecessionhaveledtoadeclineinqualityhousingjobs.Intheeventofamassinfluxofconstructionprojects,unionsmightnothaveenoughmemberstoadequatelyguaranteeacertainleveloforganizedlaborparticipationinthoseprojects.

Asaresult,unionscommonlyopposereformsthatwouldweakenCEQA,includingCaliforniaGov.JerryBrown’smostrecentby-rightproposalthatwouldhavebypassedlocalauthoritytopreventthedevelopmentoflow-incomehousingunderCEQA.7

Asdetailedlater,ratherthanusingCEQAtotrytomaintainthestatusquo,thereisapotentialpathwayforunionmembershipandjobstoincreasebyusingCEQAtointelligentlyadvanceprojectsratherthanhaltthem.Evenasnationalunionmembershipremainsonthedecline,thesheerdemandfornewhousing,newinfrastructure,andnewcommercialbuildingscouldbringactualgrowthinunionmembership,ifchangeswereimplementedinCEQAeffectively.

Combinedwithsmartlyplannedinfillprojects,thiswouldhavethepotentialtoincreasequalityoflifefornumerousunionmembers,aswellasforthousandsofotherswhowouldbenefitfromsuchprojects.

FIGURE2.EmployedCaliforniansenrolledinunions,bypercentage

Source:U.S.BureauofLaborStatistics

6http://www.bls.gov/regions/west/news-release/unionmembership_california.htm#tableA7http://www.latimes.com/politics/la-pol-sac-labor-enviro-housing-20160524-snap-story.html

16.5

15.7

16.7

18.4

17.217.5

17.1 17.2

16.4 16.3

15.9

14

15

16

17

18

19

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

8

TheResultofCEQALitigationAbuseWhenalltheseactorsuseCEQAasawaytogetwhattheywant,theresultisonebigbarriertodevelopmentinCalifornia.WhennewconstructionprojectsseedelaysorevencancellationsasaresultofCEQAlitigation,theresultislesshousing,highercosts,andmoresprawl,which,ironically,causesmoreharmtotheenvironmentthroughincreasedvehicleusageaspopulationcentersspreadout.

Infact,arecentstudyconductedbytheHolland&KnightlawfirmthatanalyzedthreeyearsofCEQAlawsuitsfoundthatmorethanthree-quartersofalllitigationunderCEQAoverathree-yearperiodwasaimedatinfillprojects–thatis,constructioninalready-populatedareas.Ontopofthat,nearlyhalfofthelawsuitstargetedgovernment-sponsoredprojectswithnoprivate-sectorapplicant.Theseprojectsincludedlow-costhousingandpublicworksprojects.8Theresultwasnotonlyreducedaccesstoaffordablehousingbutalsoincreasedcostsandfeesassociatedwithlitigatingtheselawsuits,whichultimatelyfelltoCaliforniataxpayerstocover.

Withthesefactorsinmind,itisclearthatCEQA’seffecthasreachedbeyonditsintendedscope.

III. CEQA as a Savior WhilethepurposeofthispaperistofocusprimarilyonwaysthatCEQAprocessesmaybestreamlined,wemustalsoacknowledgethepositiveeffectthelawhashadonCalifornia’senvironment.CEQAistheonlylawofitskindinthecountry,anditsimplementationhasundoubtedlyprotectedandpreservedcountlesselementsofCalifornia’senvironment.

Policymakersmustnotmistakereformforreplacement.HerewelistjusttwocasesinwhichCEQAwasaneffectivetooltoprotecttheenvironment.In2005,thePlanningandConservationLeague,anonprofitbasedinSacramento,releasedareportdocumenting75instancesinwhichCEQAplayedamajorroleinprotectingthestate’secosystems.9Whatlawmakersmustdoisfindthebalancebetweenthestate’seconomyanditsenvironment,twoaspectsofCaliforniathatareirrevocablyintertwined.

CASE1:TheAmerica’sCupIn2013,preparationswereunderwayinSanFranciscotohosttheAmerica’sCupcompetition.Amajorpartofthosepreparationsincludedtherenovationofthecity’smaincruiseshipterminal.Theproject’sEIRindicatedamajorincreaseintheterminal’sairpollutionoutput,primarilybasedontheneedforshipstogenerateadditionalpowerusingdieselfuelwhilethepierswereunderconstruction.

Environmentalgroups,concernedabouttheincreasedairpollution,reachedanagreementwiththeprojectdevelopersthatreducedsignificantlytheenvironmentalimpactoftheprojectby

developinganalternativeon-shorepowersupplynearby.Theestimatedpollutionreductionincluded11tonsofreactiveorganicgases,215tonsofnitrogenoxides,and6tonsofparticulatematterin2013alone.10

8https://issuu.com/hollandknight/docs/ceqa_litigation_abuseissuu?e=16627326/141977149http://www.ecovote.org/imx/ceqa_report.pdf10http://sfmea.sfplanning.org/2010.0493E_DEIR6.pdf

9

CASE2:AgricultureinSanDiegoCountyIn1996,aproposaltoconvert200,000acresofSanDiego’sbackcountrytointenseagriculturalusecamebeforethecounty’sboardofsupervisors.Theproposalreceivedahighamountofcriticismfromlocalenvironmentalgroups.But,despitetheless-than-comprehensiveEIRthatwassubmitted,theboardapprovedthemeasure.CEQAlawsuitsinitiatedbyagroupcalledSaveOurForestandRanchlandseventuallyattractedtheattentionofstateandnationalofficialsbypointingouttheEIR’smassivedeficiencies.Ultimately,multiplerevisionstotheEIRmandatedbythecourtsresultedinenactmentofseveralenvironmentalprotections,

includingtheencouragementofranch-stylefarming,limitsonagriculturaldensityinthearea,andtheexpansionofthesurroundingcountywaterlinetoreducethechancesoffutureurbansprawl.11

IV. CEQA Exemptions: A Broken Tool WhileCEQAiscondemnedbymanyasanoverlybureaucratichurdletodevelopmentinCalifornia,someofthestate’slargestconstructionprojectshavebeenexemptedfromthescrutinythatsomanyotherdevelopershavefaced.Ironically,itistheprojectsthataremostabletoaffordfinancialcostsassociatedwithCEQAthataremostlikelytobypassthem.Theseprojectsaregenerallylarge-scale,one-offprojectssuchasstadiums,governmentbuildingimprovements,andfactories.

L.A.RAMSPASSIONPROJECTRamsfansinSouthernCaliforniaarerejoicingatthereturnoftheirNFLteam.Foritsfirstthreeseasons,theteamwillplayattheiconicLosAngelesMemorialColiseumwhilethe70,000-seatCityofChampionsStadiumisbuiltinInglewood.Normally,aprojectofthissizewouldbesubjecttointenseenvironmentalscrutiny,butfewthingsgetpeoplemorefiredupthanfootball.Teamandcityofficialswerealltoowillingtocapitalizeonthatpassion,andbyannouncingaballotinitiativeandcollectingthe

necessarysignaturesforthenewstadiumproject,theywereabletotriggerastreamlinedEIRreviewprocess.

Infact,sospeedywasthereviewthatapprovalwasgainedbeforeapublicvotewasevennecessary,sothemeasureneveractuallyappearedonanyballot.Therealityisthat,whenitcomestolarge-scaleprojects,suchasarenasandstadiums,thereisanear-unbeatablelevelofsupportthatusuallyresultsinexemptionsandadditionalstreamliningfromlocalandstategovernments.

LegislationbypassingCEQAforcertainprojectsisacommonsightonthefloorofthestateAssemblyandSenate.Recentexamplesinclude:

! SB836–AbillexemptingrenovationstotheCaliforniaCapitolComplexfromextensiveCEQAreview12

! AB890–AbillexemptingroadwayrestorationfromextensiveCEQAreview13

11http://www.sofar.org/gpa9603main.htm12https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201520160SB836

10

! AB931–AbillexemptingcertaininfillhousingandpartialretailpropertiesfromCEQAreview14

V. Recent Attempts at ReformTherehavebeenanumberofrecenteffortstofine-tuneandstreamlinethelawthathavemetwithlittlesuccess.Herewewillexaminesomeofthemorehigh-profileefforts.

By-RightDevelopmentInMay2016,Gov.Brownissuedaboldproposaltoaddressthestate’shousingcrisis.Undercurrentlaw,localjurisdictionshavethepowertoreviewtheenvironmentalimpactofaffordablehousingdevelopmentprojectsandapproveordenythem.Thesereviewsoftenresultinlongdelaysand,ultimately,oppositiontodevelopment,withNIMBYismwinningtheday.Brownisawell-knownopponentofCEQAinitscurrentform,evengoingsofarastosayin2012,“I’veneverseenaCEQAexemptionthatIdon’tlike.”15

IntheMaybudgetrevision,Brownproposedthattheselocaljurisdictionsbestrippedoftheirreviewpowersinareaswhereaffordablehousingisneededmost.Thegovernorisknownforbeingfiscallyconservative,andthemovewashailedbymanyasawaytoincreasedevelopmentwithoutappropriatingadditionalfundingforhousing.

However,basedonthecompletebypassingoflocalcontrols,alongwiththeirresultantreducedbargainingposition,organizedlaborstronglyopposedthemeasure,writinginalettertotheLegislature:

“Weunderstandtheneedformorehousingandotherinfilldevelopment,andsupportworthyprojects.Butdevelopment“byright”goestoofar.Byprecludingenvironmentalanalysisandreadilyavailablemitigationmeasuresthatcanprotectlocalresidents,thisproposalputsthehealthandwell-beingofpeopleatrisk,especiallychildren.Simplyput,thisproposalwouldbeadisasterfortheenvironment,thepublicandthefutureresidentsofthesedevelopments.”16

Thislevelofoppositionprovedtoopowerfultoovercome,andtheproposal,alongwithitscompanionlegislation,diedaquietdeathbeforereceivingavote.Sostrongwastheoppositionandsopowerfulthelaborlobbythatnotasinglelawmakerineitherpartypubliclyvoicedsupportforthemeasure.1718Thatbeingsaid,thepositionvoicedbyorganizedlaborintheletterverymuchdoesleaveopenthepossibilityforamiddlepath:expeditingprojectswhilenotcompletelybypassingthelocalcontrols.Thismiddlepathisessentialforfindingeffectivesolutionstothehousingshortfallwhilealsoensuringthatallpartiesrecognizethebenefitsofareducedcostoflivingforworkersandreducedcommutetimestobenefittheenvironment.

13https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201120120AB89014http://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201120120AB93115http://www.sacbee.com/news/politics-government/capitol-alert/article24879877.html16http://advocacy.calchamber.com/wp-content/uploads/2016/08/Gov-Prop-Labor-Env-5-18.pdf17http://www.latimes.com/politics/la-pol-sac-governor-housing-failure-20160912-snap-story.html18http://www.latimes.com/politics/essential/la-pol-sac-essential-politics-updates-low-income-negotiations-are-done-1471561791-htmlstory.html

11

VI. Recommendations Asthispaperdemonstrates,CEQAdoespresentadeleteriouseffectonseveralaspectsofCalifornialife,includinghousingcostsandsprawl.TheseobstaclesharmCaliforniaanditsenvironmentthroughlitigationabuseandadisregardfortheoriginalintentofthelaw.NoseriousmovementexiststocompletelytearCEQAdown.Throughreform,however,thesenegativeeffectscanbemitigated.

Unfortunately,theso-called“green/bluealliance”betweenenvironmentalandlaborinterestspresentsanear-unbeatableobstacletolarge-scalereform.Whilethoseintheenvironmentallobbyarewillingtoopenlydiscusstheiroppositiontoreform,laborisfarlesswillingtotalk.Thisisalmostcertainlybecauseapro-environmentargumentismoreagreeablethanthepro-moneypositionheldbylabor. EngagePolicymakersandSwellPassionforReformMostpolicymakersinSacramentowillagreethatCEQAneedsfine-tuning,ifnotlarge-scalereform.Theproblemwiththispositionisthatanylegislatororelectedofficialwhosayssopubliclywillimmediatelyincurthewrathofanumberofstatewideinterestgroups,particularlythoseinthegreen/bluealliance:laborandenvironmentalists.

Evenformergovernors,whocanspeakcandidlywithoutfearofpoliticalreprisal,agreethatreformsareneeded.Ina2012op-edfortheSanDiegoUnion-Tribune,formergovernorsGeorgeDeukmejian,PeteWilson,andGrayDaviswrote:

“TherehasbeenalotoftalkabouttheneedtoconfrontCEQAlitigationabuse,butunfortunatelyit’sbeenmostlytalk.Inactionisnolongeranoption,asthereissimplytoomuchatriskforbothoureconomyandourenvironment.Wemusttacklethisimportantissuenow.Byapplyingreasonalongwithwell-establishedCaliforniacharacteristicsofinnovation,self-confidence,andenvironmentalandeconomicleadership,wecanindeedmodernizeCEQA,endfrivolouslitigationabuse,andrestorethenecessarybalancesothatourstatecanremainboth“green”and“golden.”AsCalifornians,anythinglessissimplynotacceptable.”19

Thishasnotstoppedlawmakersfromfacilitatingone-offstreamliningeffortsandworkarounds,however.IncreaseAwarenessofStreamliningOptionsAnumberofstreamliningprovisionsalreadyexistwithincurrentCEQAlegislationthatmanydevelopersandagenciesaresimplynotawareof.IncreasingawarenessoftheseoptionswouldbeaneffectivewayforprojectmanagerstoexpediteconstructionwithincurrentCEQAguidelines.

Forexample,provisionsinSB375(Steinberg,2008),SB226(Simitian,2011),andAB32(2006,NuñezandPavley)outlinenumerousfast-trackingoptionsforqualifyingprojects.Knowledgeofthese

19http://www.sandiegouniontribune.com/opinion/commentary/sdut-keep-california-green-and-golden-with-ceqa-reforms-2012jul12-story.html

12

provisions,however,isdependentonknowingwheretofindthemandbeingabletounderstandifandhowtheyapplytoaspecificproject.Awebsitecanbedevelopedbygovernmentagenciestoposeaseriesofsimplequestionsaboutaparticularprojectthatadevelopercananswer.Basedontheanswerstothosequestions,differentpossibleresultscouldbepresentedtoinformtheuseroftheoptionsforstreamliningthatexistunderCEQAlaw.

AflowchartwasdevelopedbytheGovernor’sOfficeofPlanningandResearch(seethelinktoitinfootnotes)todemonstratethestreamliningoptionsimplementedbySB226.20Aninteractiveversionofthistoolcouldgoalongwayinmakingdevelopersawareofstreamliningoptions.PresentAlternativesforLabortoMaintainLeverageInordertogetorganizedlaboronboardwithanykindofrealreform,itmustfeelasthoughitisnotlosingtheupperhandindevelopmentagreementconversations.Aspreviouslymentioned,laborcommonlyusesCEQAlawsuits–orthethreatofCEQAlawsuits–toincreaseitsinfluenceinlabornegotiations.Itwillnotgivethistoolupeasily.

Therefore,itisimportantthatlaborbepresentedwithalternativemethodstomaintainitsleverage.Ifandwhenlarge-scaleCEQAreformoccurs,andproposeddevelopmentsthathadpreviouslybeenhaltedmoveforward,labororganizationswillbehandedhundredsifnotthousandsofnewconstructionprojectsalloverthestate.Eveniftheranksofconstructionunionsswelled,theseprojectswouldbetoonumeroustobeginallatonce.Therefore,thekeywillbeprioritization;laborunionswillbeabletonegotiatewithdeveloperstoprioritizeprojectsformoreimmediateconstruction.Thiswillallowlabortoretainameasureofleveragefornegotiatingmorefavorableagreementswhileremovingamajorbarriertodevelopment.LitigationTransparencyAcommontacticforCEQAlitigationabuseistocreateanonprofitorganizationwithanenvironmentallyfriendlynamethatis,infact,simplyafrontusedtofilelawsuitsagainstdevelopers.TheseorganizationsarecurrentlyexemptfromfinancialdisclosurerequirementsthatotherpartiesinCEQAlitigation,suchasthosewhowishtofileamicusbriefs,aresubjectto.21Bysheddinglightonthefinancialbackersoforganizationsthatfilesuit,thevalidityoftheclaimcanbeinformed.

VII. Conclusion Ultimately,mostagreethatCEQAisalawthatdoesalotofgoodbuthasbecometooburdensometoinfilldevelopmentinastatethatdesperatelyneedsit.Mostalsoagreethatchangesareneeded,butforavarietyofreasons,includingfearofpoliticalreprisal,environmentalconcerns,andoutrightgreed,theyareunwillingorunabletomakethepoliticalmovesnecessarytoenactthosechanges.

20https://www.opr.ca.gov/docs/InfillStreamliningFlowchart.pdf21http://www.courts.ca.gov/cms/rules/index.cfm?title=eight&linkid=rule8_520

13

Surgicalchangesmaybeenacted,includinglitigationtransparencyandsmallstreamliningmeasures,butwhenitcomesdowntoit,nomajorreformwilleveroccuraslongaslaborand,toalesserextent,environmentalinterestsdominatethelegislativearena.FearoftheselobbiesissogreatthataverypopulargovernorinastateruledbyhisownpartywasunabletogetasinglevoiceoflegislativesupportforameasuretostreamlineCEQA.

About the AuthorsJasonBarrettisaseniorpublicpolicyanalystattheMilkenInstitute.HemonitorspoliticalactivityinSacramentoandWashington,D.C.,andanalyzesitseffectsoneconomic,financial,andregulatorypolicies.Barrettseekstoprovidedecision-makersandInstitutestakeholderswithkeyinformationregardingrelevantlegislationandpoliciesatthecity,state,andnationallevels.RecentprojectsfocusonidentifyingpracticesthatcouldhelpCaliforniaimprovecompetitivenessandattractbusinesses,suchasexpandedaccesstogovernmentinformationthroughstatewideopen-datapolicies. Previously,BarrettworkedforCongressionalQuarterly,anorganizationthatanalyzesthelatestlegislativeactivityinWashington.HealsoworkedintheCapitolHillofficeofU.S.Sen.BillNelson.Barrettreceivedabachelor’sdegreeincorporatecommunicationsandpoliticalsciencefromElonUniversityandamaster’sdegreeinlegislativeaffairsfromGeorgeWashingtonUniversity. KevinKlowdenistheexecutivedirectoroftheMilkenInstitute’sCaliforniaCenterandamanagingeconomistattheInstitute.Hespecializesinthestudyofdemographicandspatialfactors(thedistributionofresources,businesslocations,andmovementoflabor)andhowtheseareinfluencedbypublicpolicyandinturnaffectregionaleconomies.Hiskeyareasoffocusincludetechnology-baseddevelopment,infrastructure,theglobaleconomy,media,andentertainment.

Klowdenwastheleadauthorof“StrategiesforExpandingCalifornia’sExports,”whichfocusedonthevitalroletradeandexportsplayinthestateeconomyanditsunderperformancerelativetothecountryoverthepastdecade.Hehasalsowrittenontheroleoftransportationinfrastructureineconomicgrowthandjobcreationinreportssuchas“California’sHighwayInfrastructure:Traffic’sLoomingCost”and“JobsforAmerica:InvestmentsandPoliciesforEconomicGrowthandCompetitiveness,”aswellasinpublicationsincludingtheWallStreetJournal.

Hehasaddressedtheroleoftechnology-baseddevelopmentinpublicationssuchasthe“2014StateTechnologyandScienceIndex,”“NorthAmerica’sHigh-TechEconomy”andlocation-specificstudiesonArkansasandArizona.Inaddition,Klowdenwastheleadauthorofseveralstudiesontheeconomicsoftheentertainmentindustry,including“AHollywoodExit:WhatCaliforniaMustDotoRemainCompetitiveinEntertainment—andKeepJobs,”“FightingProductionFlight:ImprovingCalifornia’sFilmedEntertainmentTaxCreditProgram,”“FilmFlight:LostProductionandItsEconomicImpactinCalifornia,”and“TheWriters’Strikeof2007-2008:TheEconomicImpactofDigitalDistribution,”eachofwhichanalyzesthechangingdynamicsoftheentertainmentindustry.

Additionally,hecoordinatedtheMilkenInstitute’stwo-yearLosAngelesEconomyProject,seekingpublic-policyandprivate-sectorsolutionstochallengestheregionfacesamidagrowingunskilledlaborpool.

14

Klowdenisafrequentspeakeronstatefiscalissuesandhasservedonmultipleadvisoryboardsonbusinessgrowth,economicdevelopment,andinfrastructure.HeholdsgraduatedegreesfromtheUniversityofChicagoandtheLondonSchoolofEconomics.

Acknowledgments TheauthorswouldliketothankJenniferL.HernandezofHolland&Knight,BillCravenandMatthewDumlaooftheCaliforniaSenateNaturalResourcesandWaterCommittee,andRebeccaSimonoftheMilkenInstitutefortheirinvaluablecontributionstothisreport. About the Milken Institute TheMilkenInstituteisanonprofit,nonpartisanthinktankdeterminedtoincreaseglobalprosperitybyadvancingcollaborativesolutionsthatwidenaccesstocapital,createjobs,andimprovehealth.

Wedothisthroughindependent,data-drivenresearch,action-orientedmeetings,andmeaningfulpolicyinitiatives. ©2016MilkenInstitute

15

ThisworkismadeavailableunderthetermsoftheCreativeCommonsAttribution-NonCommercial-NoDerivs3.0UnportedLicense,availableathttp://creativecommons.org/licenses/by-nc-nd/3.0/