November 6, 2009

California Continues Efforts to Link Greenhouse Gas Reductions to Land Use Decisions – but Offering Clear Advice Still a Challenge

Holland & Knight Alert
Jennifer L. Hernandez | Amy L. Edwards | Bonni F. Kaufman

Two recent regulatory developments demonstrate California’s continued efforts to link greenhouse gas (GHG) reductions to land use decisions. On September 29, 2009, the Regional Targets Advisory Committee (RTAC) submitted its recommendation to the California Air Resources Board (CARB) for establishing regional emission reduction targets pursuant to Senate Bill 375 (SB 375) (RTAC Recommendations)1. And on October 23, 2009, the California Natural Resources Agency (CNRA) announced a 15-day comment period on revised proposed amendments to the California Environmental Quality Act (CEQA) Guidelines (Proposed Amendments) to address GHG emissions under CEQA.2 These actions are likely to further influence the manner in which climate change considerations are taken into account as part of the land use planning and environmental review process.

RTAC Recommendations

Background

In 2008, the California legislature enacted SB 375, a landmark law that seeks to align the planning process for land use, transportation and housing. (See our alert dated November 25, 2008.) SB 375 requires CARB to set emission reduction targets for GHG emissions from the use of vehicles and light trucks – vehicular emissions that are directly linked to land use and transportation patterns. These targets must be provided by September 30, 2010. The targets will be developed for each of the 18 metropolitan planning organizations (MPOs) in California, which must incorporate these targets into sustainable community strategies (SCSs) – or, if necessary, alternative-planning strategies – that explain how the region will achieve established targets. Significantly, the SCS must be included in the regional transportation plan (RPT) developed by each MPO. Because RTPs must undergo a conformity analysis pursuant to the Clean Air Act (CAA) that demonstrates the RTP’s consistency with CAA requirements for a region to receive federal transportation funding, SB 375 links local land use planning with the receipt of federal transportation dollars.

SB 375 also required CARB to appoint an RTAC by January 31, 2009 to recommend factors for CARB to consider and methodologies for it to use in setting GHG emission reduction targets for each region. The RTAC must include representation from the League of California Cities, the California State Association of Counties, MPOs, developers, planning organizations and other stakeholders. In January 2009, CARB appointed 21 members to the RTAC, from a variety of constituencies. On September 29, 2009, the RTAC released its recommendations to CARB, representing a key step in the establishment of regional targets for inclusion in SCSs.

RTAC Recommendations

RTAC’s charge was highly technical, and the RTAC Recommendations focus largely on the manner in which CARB staff should interact with various stakeholders during the target-setting process, and how it should use empirical studies and modeling in establishing regional GHG targets. Certain key themes emerge from the RTAC Recommendations, however. Because the RTAC Recommendations will significantly influence how CARB sets GHG emission reduction targets, these key recommendations have major implications on land use planning.

1) Single Metric – With Appropriate Adjustments

RTAC recommends that CARB establish a single, uniform statewide target expressed as a per-capita percent GHG emission reduction target starting with a 2005 base year. This metric was chosen for its simplicity and to directly reflect growth rate differences between regions. This approach would also give “credit” to regions that have taken early steps to reduce GHG emissions by requiring lower total reductions. However, the RTAC Recommendations recognize regional variability, and suggest that CARB work with MPOs to set a single standard that could be adjusted up or down based on regional differences. These adjustments should ensure that targets are the most “ambitious achievable.” In other words, RTAC recognizes the need to take political and economic realities into account.

2) Emphasis on Best Management Practices

The RTAC Recommendations demonstrate an awareness of the challenges faced by MPOs – and ultimately by cities and counties – in meeting GHG emission reduction targets. In an attempt to simplify the process, RTAC recommends the development of best management practices (BMPs) that MPOs could utilize in order to achieve their GHG targets. This list would be developed as soon as possible, with the goal of finalizing it in the next 4-6 months. RTAC recommends that CARB consider the pros and cons of requiring that the developed list of BMPs serve as the sole method of demonstrating compliance.

3) Flexibility in Implementation

RTAC also recognizes that tools and information available to CARB to set targets may be different from those available to MPOs to demonstrate how they will meet such targets. The RTAC Recommendations emphasize the importance of designing a sufficiently flexible process, one that will enable the use of new tools and data in the RTP update process as such tools become available.

4) Smart Growth, Not No Growth

RTAC also makes clear that SB 375 is not intended to stop growth and development, but rather is meant to facilitate good planning decisions; the RTAC Recommendations leave plenty of room for properly-designed growth.

Next Steps

Now that RTAC has issued its recommendations, the focus of SB 375 implementation shifts to CARB. On October 28, 2009, CARB issued a notice of a public meeting to consider the RTAC Recommendations on November 19, 2009. Once CARB determines which recommendations to adopt, it will continue the process of establishing regional GHG targets. These targets must be developed by September 30, 2010. Once the regional targets are set, attention will focus to the MPOs who will need to develop SCSs reflecting these targets. The RTAC Recommendations reflect a critical step in the SB 375 process and reflect RTAC’s efforts to develop a framework for achieving GHG reductions that is both technical and practical.

Revised CEQA GHG Guidelines

Background

Senate Bill 97 (SB 97), passed in 2007, required the Governor’s Office of Planning and Research (OPR) to prepare guidelines for the mitigation of GHG emissions or the effect of GHG emissions and submit those guidelines to CNRA by July 1, 2009. CNRA must adopt guidelines by January 1, 2010. OPR initially released proposed guidelines on January 8, 2009 (See our alert dated January 23, 2009), which it amended and submitted to CNRA on April 13, 2009. CNRA commenced its rulemaking process for certifying and adopting these amendments on July 3, 2009. After receiving public comment on the proposed amendments, on October 23, 2009, CNRA released the Proposed Amendments, which make some revisions to the April 13 guidelines proposed by OPR.

Proposed Revisions

The Proposed Amendments include a number of non-substantive technical revisions and clarifications. Key revisions in the Proposed Amendments are summarized in CNRA’s Notice of Proposed Changes, and are discussed below.

1) Clarify Standards for Determining Significance of GHG Emissions

CNRA received many comments on the discretion left to lead agencies in proposed section 15064.4 to perform either a quantitative or qualitative analysis in determining the significance of a project’s GHG emissions. The Proposed Amendments preserve this discretion; however, they clarify the standard applicable to any proposed analysis. The Proposed Amendments would revise section 15064.4 from instructing an agency to base its analysis on “available information,” to require that the lead agency base its analysis “to the extent possible on scientific and factual data.” The proposed revision would also clarify that a lead agency may perform a qualitative or quantitative, or both, analysis, as appropriate for the project. The proposed revision also provides that the lead agency “should,” rather than “may,” consider the non-exclusive list of factors for assessing the significance of GHG emissions.

2) Simplify Guidance on Statement of Overriding Considerations

After receiving comments expressing both support and concern about proposed section 15093(d), regarding consideration of regional and statewide benefits when making a statement of overriding considerations, CNRA proposes to revise section 15093(a) to make clear that CEQA, as a general matter, requires balancing of all benefits, including region-wide and state-wide environmental benefits, in the consideration of overriding considerations. The Proposed Amendments would delete the separate subsection where CNRA previously proposed calling out this concept.

3) Clarify Analysis of Project in a Changing Climate

CNRA received various requests to clarify how to address the effects of changing climate on a project. The proposed revision to section 15126.2 includes a sentence indicating that an environmental impact report should analyze the effect of placing a project in an area susceptible to hazardous conditions, and specifies the types of areas that would be most affected by climate change: floodplains, coastlines and wildfire risk areas. The proposed revision also clarifies that this hazard analysis is appropriate where risks are specified in authorized hazard maps, risk assessments or land use plans. In addition, CNRA emphasizes that the clarifying language remains subject to existing CEQA standards regarding environmental analysis, including limitations on speculation and forecasting.

4) Clarify Standards of Mitigation of GHG Emissions

Some commenters expressed concern regarding the reliability of off-site mitigation measures, and suggested that section 15126.4(c) be revised to express a preference for on-site mitigation. CNRA declined to revise this section to express a preference for on-site mitigation; however, the Proposed Amendments would clarify that any GHG mitigation must be supported by substantial evidence and be subject to monitoring. The revisions also would clarify that reductions in GHG emissions that result from activities not otherwise required may constitute mitigation within the meaning of section 15126.4(c).

5) Refine Guidelines on Cumulative Impacts Analysis

CNRA received several comments suggesting that proposed subsection (f) of section 15130, which states that, “An EIR shall analyze greenhouse gas emissions resulting from a proposed project when the incremental contribution of those emissions may be cumulatively considerable,” simply restates the law and could be misinterpreted. The Proposed Amendments would delete this subsection. However, the Notice of Proposed Changes emphasizes that this deletion is appropriate because the reasoning behind it – that GHG emissions are appropriately considered at a cumulative level – is fully explained in the Initial Statement of Reasons, and thus need not be repeated in subsection (f).

6) Further Refine Appendix G Questions Related to Transportation

Many commenters raised concerns about the phrasing of question XVI(a), which asked the extent to which a project would exceed the capacity of an existing circulation system. The Proposed Amendments would refocus this inquiry from capacity to performance of the circulation system, as indicated in an applicable plan or ordinance. The proposed revisions also would state that this inquiry should consider all modes of transportation, including both mass transit and non-motorized travel. The Proposed Amendments would also revise question XVI(f) to clarify that the lead agency should include safety considerations in its analysis.

Next Steps

CNRA is accepting written comments on the Proposed Amendments until November 10, 2009. As previously noted, SB 97 requires CNRA to adopt revised CEQA guidelines by January 1, 2010.

Conclusion

California continues to lead the nation on developing regulations to address GHG emissions, in particular with respect to land use planning decisions. However, RTAC and CNRA’s recent activity demonstrate the challenges of providing clear advice on how, as a practical matter, this should be done.

California continues to be on track to comply with SB 375’s mandate to integrate GHG reductions with land use and transportation planning. In particular, RTAC’s emphasis on developing BMPs to achieve these targets indicate the desire to take some of the guesswork out of the SB 375 process, but whether CARB will be able to develop such a list remains to be seen.

On the CEQA front, CNRA has largely left in place OPR’s originally-proposed CEQA guideline amendments, which attempt to fill a void for local agencies struggling with how to analyze GHG emissions under CEQA. Yet the Proposed Amendments would still leave much of the decision-making for how exactly to analyze, mitigate and determine the significance of GHG emissions to lead agencies, continuing to assign to each lead agency the responsibility for deciding how to prepare legally adequate climate change analyses in CEQA documents. Although CARB began the process of developing state-wide GHG significance thresholds, this process has been put on indefinite hold.

Also, although three large air districts – Bay Area Air Quality Management District, South Coast Air Quality Management District and San Joaquin Air Quality Management District – are in the process of developing their own approaches to analyzing GHG significance, these efforts are ongoing, and thus far have not resulted in a single, consistent recommendation. In this climate of uncertainty, both lead agencies and project proponents lack clear direction on how to conduct a GHG analysis under CEQA. Meanwhile, several lawsuits regarding climate change analysis under CEQA are pending and no appellate-level decision has been reached. Notwithstanding the regulatory efforts underway, it appears likely that courts will begin to give some direction on this unresolved – and increasingly litigious – area of CEQA. 

1 Recommendations of the Regional Targets Advisory Committee (RTAC) Pursuant to Senate Bill 375: A Report to the California Air Resources Board. Available at: http://www.arb.ca.gov/cc/sb375/rtac/report/092909/finalreport.pdf.

2
Notice of 15-Day Comment Period on Change to Proposed Amendments to the State CEQA Guidelines (Notice of Proposed Changes) and Proposed Amendments available at: http://resources.ca.gov/ceqa/docs/Notice_of_Proposed_Changes.pdf.

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