The California Environmental Quality Act (CEQA) requires a lead agency, as defined, to prepare, or cause to be prepared, and certify the completion of, an environmental impact report (EIR) on a project that it proposes to carry out or approve that may have a significant effect on the environment or to adopt a negative declaration if it finds that the project will not have that effect. CEQA also requires a lead agency to prepare a mitigated negative declaration for a project that may have a significant effect on the environment if revisions in the project would avoid or mitigate that effect and there is no substantial evidence that the project, as revised, would have a significant effect on the environment.

CEQA provides for limited CEQA review or exempts from its requirements transit priority projects meeting certain requirements, including the requirement that the project be within ¹/₂ mile of a major transit stop or high-quality transit corridor included in a regional transportation plan. CEQA specifies that a project is considered to be within ¹/₂ mile of a major transit stop or high-quality transit corridor if, among other things, all parcels within the project have no more than 25% of their area farther than ¹/₂ mile from the stop or corridor.

This bill bill, for a transit priority project to meet the requirements for limited CEQA review, would increase that percentage to 50%.

The California Environmental Quality Act (CEQA) requires a lead agency, as defined, to prepare, or cause to be prepared, and certify the completion of, an environmental impact report (EIR) on a project that it proposes to carry out or approve that may have a significant effect on the environment or to adopt a negative declaration if it finds that the project will not have that effect. CEQA also requires a lead agency to prepare a mitigated negative declaration for a project that may have a significant effect on the environment if revisions in the project would avoid or mitigate that effect and there is no substantial evidence that the project, as revised, would have a significant effect on the environment.

CEQA exempts from its requirements transit priority projects meeting certain requirements, including the requirement that the project be within ¹/₂ mile of a major transit stop or high-quality transit corridor included in a regional transportation plan. CEQA specifies that a project is considered to be within ¹/₂ mile of a major transit stop or high-quality transit corridor if, among other things, all parcels within the project have no more than 25% of their area farther than ¹/₂ mile from the stop or corridor.

This bill would increase that percentage to 50%.

SENATE COMMITTEE ON ENVIRONMENTAL QUALITY

Senator Wieckowski, Chair

2015 - 2016 Regular

Bill No: AB 1886

SUBJECT: California Environmental Quality Act: transit priority projects.

ANALYSIS:

Existing law:

1. Requires lead agencies with the principal responsibility for carrying out or approving a proposed project to prepare a negative declaration, mitigated declaration, or environmental impact report (EIR) for this action, unless the project is exempt from CEQA (CEQA includes various statutory exemptions, as well as categorical exemptions in the CEQA guidelines). (Public Resources Code §21000 et seq.).
   
2. Requires metropolitan planning organizations (MPOs) to include a sustainable communities strategy (SCS), in their regional transportation plans, or an alternative planning strategy (APS), for the purpose of reducing greenhouse gas (GHG) emissions; aligns planning for transportation and housing; and creates specified incentives for the implementation of the strategies, including CEQA exemption or abbreviated review for residential or mixed-use residential “transit priority projects,” if the project is consistent with the use designation, density, building intensity, and applicable policies specified for the project area in either an approved SCS or APS.
   1. Requires a “transit priority project” to meet the following conditions:
      1. Contain at least 50% residential use;
      2. Provide at least 20 dwellings per acre; and
      3. Be within one-half mile of a major transit stop or high-quality transit corridor. To qualify, all parcels within the project must have no more than 25% of their area farther than one-half mile from transit and not more than 10% of the residential units or 100 units, whichever is less, may be farther than one-half mile from transit.
   2. Defines “major transit stop” as a site containing an existing rail transit station, a ferry terminal served by either a bus or rail transit service, or the intersection of two or more major bus routes with a frequency of service interval of 15 minutes or less during the morning and afternoon peak commute periods.
   3. Defines “high-quality transit corridor” as a corridor with fixed route bus service with service intervals no longer than 15 minutes during peak commute hours.
3. For a transit priority project to meet the requirement for an abbreviated review under the SCS provisions of CEQA, requires all parcels within the project have no more than 25% of their area be located farther than one-half mile from a major transit stop or high-quality transit corridor.

This bill:

For a transit priority project to meet the requirement for an abbreviated review under the SCS provisions of CEQA, revises the definition of “transit priority project” by increasing the percentage, from 25% to 50%, of the project area that may be farther than one-half mile from a major transit stop or high-quality transit corridor.

Background

1. Background on CEQA.
   
   1. Overview of CEQA process. CEQA provides a process for evaluating the environmental effects of a project, and includes statutory exemptions, as well as categorical exemptions in the CEQA guidelines. If a project is not exempt from CEQA, an initial study is prepared to determine whether a 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. Prior to approving any project that has received environmental review, an agency must make certain findings. 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.
      
      If a mitigation measure would cause one or more significant effects in addition to those that would be caused by the proposed project, the effects of the mitigation measure must be discussed but in less detail than the significant effects of the proposed project.
      
   2. What is analyzed in an environmental review? Pursuant to CEQA, an environmental review analyzing the significant direct and indirect environmental impacts of a proposed project may include water quality, surface and subsurface hydrology, land use and agricultural resources, transportation and circulation, air quality and greenhouse gas emissions, terrestrial and aquatic biological resources, aesthetics, geology and soils, recreation, public services and utilities such as water supply and wastewater disposal, and cultural resources. The analysis must also evaluate the cumulative impacts of any past, present, and reasonably foreseeable projects/activities within study areas that are applicable to the resources being evaluated. A study area for a proposed project must not be limited to the footprint of the project because many environmental impacts of a development extend beyond the identified project boundary. Also, CEQA stipulates that the environmental impacts must be measured against existing physical conditions within the project area, not future, allowable conditions.
      
   3. CEQA provides hub for multi-disciplinary regulatory process. CEQA assists in moving a project through the multi-disciplinary, regulatory process because responsible agencies may rely on the lead agency’s environmental documentation in acting on the aspect of the project that requires its approval and must prepare its own findings regarding the project. A variety of issues, many of which involve permitting and/or regulatory program requirements, should be coordinated and analyzed together as a whole. CEQA provides a comprehensive analysis of a project’s impacts in those subject areas.
      
2. Infill development. “Infill development” occurs in already built-up areas with existing transportation and utility infrastructure, often repurposes or replaces existing buildings, parking lots, or other impervious areas, and adds homes and/or businesses near the center of cities and towns. Examples of infill project locations include a disused parking lot, an old commercial property, or a former industrial site. Infill development is considered a vital strategy for efficient growth.
   
   Infill builds within an existing footprint of development, which can reduce development pressure on outlying areas, helping to safeguard lands that serve important ecological functions and preserve open space and prevent conversion of agricultural land; can reduce the amount that people drive, improving air quality and reducing GHG emissions; and can lead to the cleanup and reuse of formerly economically viable but now abandoned sites, including those contaminated with hazardous substances. Also, by locating new developments near population centers and amenities, communities can take advantage of existing water, sewer, and transportation systems, avoiding the cost of installing expensive new infrastructure.
   
   According to the US Environmental Protection Agency (US EPA), several trends point to a sustained increase in demand for infill development and a market opportunity for developers. Consumer preferences for the amenities that infill locations offer are likely to grow as changing demographics affect the housing market. In the next couple of decades, the needs and preferences of aging baby boomers, new households, and one-person households will drive real estate market trends – and infill locations are likely to attract many of these people. As more people choose to live in infill neighborhoods, employers are following, and vice versa. Many corporations are moving to infill locations, in part because they recognize the competitive advantages of being closer to the central city. (US EPA, “Smart Growth and Economic Success: Investing in Infill Development,” February 2014.)
   
   The Strategic Growth Council (SGC), as a part of its broader legislative mandate, has identified “infill” development as an important strategy for achieving AB 32 greenhouse gas (GHG) emissions reduction targets. While contributing to reductions of GHG emissions, achieving infill development can confer a broad range of benefits, such as increased economic vitality of the state’s urban centers; decreased consumption of energy, water, and other natural resources; reduced conversion of farmland and natural habitat areas; and the opportunity for more efficient infrastructure investment and delivery of municipal services.
   
   Over the past several years, MPOs have been preparing SCS plans mandated by SB 375 (Steinberg, Chapter 728, Statutes of 2008) through regional planning efforts. As part of these planning efforts, MPOs have developed new regional and local population and employment forecasts that envision increasingly clustered future regional land use patterns that likely will provide GHG emissions reductions benefits.
   
3. Infill development and CEQA. Several changes have been made to CEQA to encourage infill projects, including the following:
   1. SB 743. SB 743 (Steinberg, Chapter 386, Statutes of 2013) made several changes to CEQA for projects located in areas served by transit (i.e. transit-oriented development (TOD)). Among the changes, SB 743 directed the Governor’s Office of Planning and Research (OPR) to develop a new approach for analyzing the transportation impacts under CEQA. SB 743 also created a new exemption for certain projects that are consistent with a Specific Plan and eliminates the requirement to evaluate aesthetic and parking impacts of a project if the project is a residential, mixed-use residential, or employment center project located on an infill site within a transit priority area.
   2. SB 226. SB 226 (Simitian, Chapter 469, Statutes of 2011) establishes abbreviated CEQA review procedures for specified infill projects, where only specific or more significant effects on the environment which were not addressed in a prior planning-level EIR need to be addressed. An EIR for such a project need not consider alternative locations, densities, and building densities or growth inducing impacts. Any unmitigated effects specific to the project can be analyzed in an “infill” EIR that limits review only to those impacts without the need to analyze alternatives or growth-inducing impacts. SB 226 required OPR to develop CEQA Guidelines for purposes of this bill.
      
      In order for infill projects to qualify for the CEQA benefits in SB 226, they must meet statewide performance standards developed by OPR. The statute required that these performance standards promote the state’s GHG emissions reductions goals in AB 32 (Núñez, Pavley) and SB 375 (Steinberg), state planning priorities, water conservation and energy efficiency standards, transit-oriented development policies, and public health.
   3. SB 375. SB 375 (Steinberg, Chapter 728, Statutes of 2008) established the Sustainable Communities and Climate Protection Act of 2008. SB 375 directed the California Air Resources Board (ARB) to set regional targets for reducing GHG emissions, setting up a “bottom up” approach to ensure that cities and counties are involved in the development of regional plans to achieve those targets. SB 375 tied together the regional allocation of housing needs and regional transportation planning in an effort to reduce GHG emissions from motor vehicle trips. According to ARB, transportation accounts for approximately 40% of GHG emissions, with cars and light trucks making up a significant majority of those emissions (30% overall).
      
      SB 375 established a collaborative process between regional and state agencies to set regional GHG reduction targets, and provided CEQA incentives for development projects that are consistent with a regional plan that meets those targets. SB 375 has three major components: (i) Using the regional transportation planning process to achieve reductions in GHG emissions consistent with AB 32 goals; (ii) Offering CEQA incentives to encourage projects that are consistent with a regional plan that achieves GHG emission reductions; and, (iii) Coordinating the regional housing needs allocation process with the regional transportation process while maintaining local authority over land use decisions.
      
   4. SB 1925. SB 1925 (Sher, Chapter 1039, Statutes of 2002) exempts from CEQA specified residential housing projects which meet criteria established to ensure the project does not have a significant effect on the environment, including urban infill housing projects not more than 100 units on a site not more than four acres in size which is within one-half mile of a major transit stop.

Comments

1. Purpose of Bill. According to the author, “Infill housing development, is the key to creating sustainable communities across California, unfortunately the vast majority of California cities are unable to take advantage of efforts to promote infill. This bill will expand the number of cities, like Sacramento, which can promote infill development.”
2. Is CEQA a major hindrance to infill development?
   1. From whose point of view? Ethan Elkind, Director of Climate Change and Business, with a joint appointment at UC Berkeley School of Law and UCLA School of Law, states, “[W]hen it comes to the big factors stopping infill, at least in California, CEQA ranks below a host of other barriers, such as local zoning codes that outlaw infill, lack of infrastructure investment, high construction costs, tax incentives that favor strip malls over housing, and poor neighborhood schools.
      
      “So why do infill developers make such a big deal about CEQA? My theory is that individual developers will be focused solely on their own projects, and if CEQA is a threat to their investment and risk-taking, they will understandably become CEQA haters. But perhaps this project-based focus distorts the view of the larger forces that stifle business opportunities throughout the state, such as in the suburb with the major rail line that won’t zone for more downtown development or the rundown neighborhood near jobs and services that needs new infrastructure. Ending CEQA tomorrow won’t magically lift these barriers and create new infill opportunities, and it won’t convince local communities to support new downtown development.” (Ethan Elkind, “Why Developers Shouldn’t Blame Environmental Review for the Lack of Infill,” Legal Planet: Insight & Analysis: Environmental Law and Policy, September 24, 2012).
      
   2. OPR survey shows CEQA is not a significant barrier to infill projects. OPR's “2012 Annual Planning Survey Results” asked city and county planners to explain the primary barriers their jurisdictions have experienced to implementing infill projects. The chart from the survey (below) shows the relative unimportance of CEQA as a barrier to infill development. Instead, infrastructure constraints, lot issues, lack of funding, community opposition, and the economy, among others ranked higher.

Based on 238 responses, 25% of jurisdictions reported that infrastructure constraints were a primary barrier to implementing infill projects. Just under 25% reported that they had problems with assembling parcels of the right size and configuration for infill development. Only 4% of respondents identified CEQA as a barrier.

A variety of factors affect the production of infill housing and commercial land uses. Notable infill development constraints include market conditions, physical conditions, infrastructure (e.g., sewer, water, streets), and other community conditions (e.g., schools, public facilities). In places where market demand, physical conditions, existing infrastructure, and community conditions are problematic, current funding and financing options are commonly inadequate, which hinders local and regional agencies’ ability to implement infill development plans. For the assorted issues mentioned above that may hinder infill development, this bill would not alleviate any of them.

1. Substantial changes made to CEQA for infill projects – Need time to see how they work. As shown above in Background #3, substantial changes have been made to CEQA in recent years for infill projects. Some of which necessitate changes to the CEQA Guidelines which can take a fair amount of time to go through OPR’s vetting process and the Administrative Procedures Act.
   
   For example, SB 226, which was enacted in 2011, required OPR to revise the CEQA Guidelines. The process of developing the guidelines included extensive public outreach efforts such as hundreds of individual meetings and conversations with stakeholders, presentations at numerous conferences, three public workshops, and two rounds of public review on OPR’s preliminary proposals. The revised CEQA Guidelines took effect in February 2013.
   
   In addition, SB 743 required OPR to amend the CEQA Guidelines to provide an alternative to LOS for evaluating transportation impacts. Particularly within areas served by transit, those alternative criteria must “promote the reduction of greenhouse gas emissions, the development of multimodal transportation networks, and a diversity of land uses (PRC §21099(b)(1)). Measurements of transportation impacts may include vehicle miles traveled, vehicle miles traveled per capita, automobile trip generation rates, or automobile trips generated. Once the CEQA Guidelines are amended to include those alternative criteria, auto delay will no longer be considered a significant impact under CEQA. SB 743 also amended congestion management law to allow cities and counties to opt out of level of service standards within certain infill areas. Aside from changes to transportation analysis, SB 743 also included several changes to CEQA that apply to transit oriented developments including aesthetics and parking. OPR is currently working on updating the CEQA Guidelines to implement SB 743.
   
   Considering the many changes made to CEQA over the recent years to abbreviate the environmental review process for infill projects, and the time it takes to update the CEQA Guidelines accordingly, the Committee may wish to consider whether it would be prudent to allow more time for these changes to come to fruition and see how infill projects benefit from them before amending CEQA again.
   
2. Walkability and 50% beyond one-half mile. According to the US EPA, infill sites are usually more walkable than other areas because many older parts of cities were built when most people moved around by foot, and many destinations are within easy reach. For purposes of infill, one-half mile is generally considered the limit for walkability distance.
   
   Current law allows a maximum of 25% of the project area be located beyond one-half mile of a major transit stop or high-quality transit corridor in order to qualify for limited CEQA review or exemption for transit priority projects. This bill would double the amount to 50% of project area being allowed to be located outside of one-half mile from a major transit stop for the limited CEQA review.
   
   Project areas are not always simple rectangles and can be oddly shaped, such as narrow and long. Depending on the shape of the project area, 50% of a project area could go well beyond one-half mile of a major transit stop or high-quality transit corridor.
   
   Also, there are no considerations made for other factors to determine whether the project area is a walkable distance from a major transit stop. For whom is this project area, beyond the one-half mile point, walkable – Is it easily walkable for a senior citizen or a person with a small child and carrying groceries? Also, are there steep hills to climb? Is walking beyond the one-half mile mark unbearable in 100-plus degree heat? A question arises as to whether it is appropriate to label a project as a “transit priority project” if up to half of the project area is not within walking distance to a major transit stop or high-quality transit corridor.
   
3. Losing sight of the the bigger purpose. Studies by the California Department of Transportation, the US EPA, and the Metropolitan Transportation Commission have found that focusing development in areas served by transit can result in local, regional, and statewide benefits, including;
   

• Increased transportation choices
• Increased public safety
• Increased transit ridership
• Reduced vehicle miles traveled
• Increased household disposable income
• Reduced air pollution and energy consumption
• Conservation of natural resources and open space
• Increased economic development
• Increased affordable housing
• Reduced local infrastructure costs.

The purpose of providing special treatment to transit priority projects is to encourage development in areas served by transit and achieve the benefits noted above. How does allowing half of a project area to be located beyond walking distance from a major transit stop contribute to those benefits? For example, the people living in housing or working in businesses located in the development but beyond walking distance from a major transit stop – How are they served by transit? Will they likely drive to where they need to go rather than walk to the major transit stop because it is beyond walking distance even though the project is labeled as a “transit priority project”? How does calling this project a “transit priority project” benefit the environment? At what point does lowering the standard render the term, “transit priority project,” meaningless?

If up to 50% of a project area is farther than one-half mile away from a major transit stop or high-quality transit corridor, would that not potentially increase the number of vehicle miles traveled, air pollution, and local infrastructure costs than the current requirement of at least 75% of the project is located within that one-half mile range?

To double the percentage of project area to 50% that is permitted to be farther than a half-mile away from a major transit stop or high-quality transit corridor, and still be considered a “transit priority project,” a question arises as to whether this bill loses sight and falls short of the long-term goals and environmental benefits of being a “transit priority project” and served by transit.

1. CEQA litigation. It is not unusual for certain interests to blame CEQA lawsuits for causing problems to a project. However, it should be noted that the only tool for enforcing CEQA is litigation. Those citing CEQA litigation as a problem do not indicate the result of that litigation. For example, were significant impacts that were not evaluated in the initial document ultimately addressed? What would have been the result if those impacts had not been mitigated (e.g., flooding, exposure of people to hazards, inadequate public services, congestion)?
   
   The total number of CEQA cases filed averages about 200 cases per year statewide and make up approximately 0.02% of 1,100,000 civil cases filed annually in California.
   
   The California Attorney General’s office conducted a case study of CEQA challenges in the City and County of San Francisco from July 2011 through December 2011 and found that 18 lawsuits were filed out of 5,203 projects considered under CEQA.
   
   According to the Natural Resources Defense Council, a review of CEQA challenges in the City of Los Angeles from January 2011 through July 20, 2012, shows that of 1,182 projects reviewed under CEQA, 18 were challenged, which is a litigation rate of 1.5%.
   

Although certain interests believe CEQA litigation to be a swathing impediment to some projects, the numbers above seem to indicate otherwise. And if a project is the subject of litigation, perhaps the cause of action has merit and ensures compliance with the law. The volume of CEQA litigation is low considering the thousands of projects subject to CEQA each year as well as the volume of civil litigation in general statewide.

1. Conclusion. Increasing infill development, particularly projects served by transit, is a laudable goal. Some environmental benefits could include reduced vehicle miles traveled, air pollution, and energy consumption, and conservation of natural resources and open space. However, if a project is to be considered transit-oriented, is it reasonable to allow up to half of the project area to not be served by transit? In such a case, are the environmental benefits fully achieved? If not, the Committee may wish to consider whether such a project should be allowed to receive the same special treatment under CEQA meant for transit-oriented projects where a significant majority of the project area is served by transit.
   

SOURCE:

Author

SUPPORT:

California Association of Realtors

California Building Industry Association

California Transit Association

San Francisco Bay Area Rapid Transit District

Southwest California Legislative Council

OPPOSITION:

California League of Conservation Voters

Natural Resources Defense Council

Sierra Club California

-- END --

ASSEMBLY THIRD READING

ATR Bill Id:AB 1886

Author:(McCarty)

As Amended Ver:May 11, 2016

Majority vote

SUMMARY: Revises the definition of a "transit priority project" for purposes of qualifying for abbreviated review under the Sustainable Communities Strategy (SCS) provisions of the California Environmental Quality Act (CEQA) to permit up to 50% of the parcels within the project to be farther than one-half mile from a major transit stop or high-quality transit corridor, as defined.

EXISTING LAW:

1. CEQA requires lead agencies with the principal responsibility for carrying out or approving a proposed project to prepare a negative declaration, mitigated negative declaration, or environmental impact report (EIR) for this action, unless the project is exempt from CEQA. (CEQA includes various statutory exemptions, as well as categorical exemptions in the CEQA guidelines.)
2. Requires metropolitan planning organizations (MPOs) to include a SCS, in their regional transportation plans, or an alternative planning strategy (APS), for the purpose of reducing greenhouse gas (GHG) emissions; aligns planning for transportation and housing; and creates specified incentives for the implementation of the strategies, including CEQA exemption or abbreviated review for residential or mixed-use residential "transit priority projects," if the project is consistent with the use designation, density, building intensity, and applicable policies specified for the project area in either an approved SCS or APS. [SB 375 (Steinberg), Chapter 728, Statutes of 2008]
   1. Requires a "transit priority project" to meet the following conditions:
      1. Contain at least 50% residential use;
      2. Provide at least 20 dwellings per acre; and
      3. Be within one-half mile of a major transit stop or high-quality transit corridor. To qualify, all parcels within the project must have no more than 25% of their area farther than one-half mile from transit and not more than 10% of the residential units or 100 units, whichever is less, may be farther than one-half mile from transit.
   2. Defines "major transit stop" as a site containing an existing rail transit station, a ferry terminal served by either a bus or rail transit service, or the intersection of two or more major bus routes with a frequency of service interval of 15 minutes or less during the morning and afternoon peak commute periods.
   3. Defines "high-quality transit corridor" as a corridor with fixed route bus service with service intervals no longer than 15 minutes during peak commute hours.
3. Establishes abbreviated CEQA review procedures for specified infill projects, where only specific or more significant effects on the environment which were not addressed in a prior planning-level EIR need be addressed. An EIR for such a project need not consider alternative locations, densities, and building intensities or growth-inducing impacts. Infill projects may include residential, retail, commercial, transit station, school, or public office building projects located within an urban area. [SB 226 (Simitian), Chapter 469, Statutes of 2011] SB 226 requires the Office of Planning and Research (OPR) to develop CEQA guidelines to implement its infill provisions, including statewide standards to promote smart growth, reduction of GHG emissions, reduction in water use, energy efficiency improvements, and protection of public health.
4. Exempts from CEQA residential, mixed-use, and "employment center" projects, as defined, located in "transit priority areas" within one-half mile of an existing or planned major transit stop, if the project is consistent with an adopted specific plan and specified elements of a SCS or APS adopted pursuant to SB 375. [SB 743 (Steinberg), Chapter 386, Statutes of 2013]
5. Exempts from CEQA specified residential housing projects which meet detailed criteria established to ensure the project does not have a significant effect on the environment, including urban infill housing projects not more than 100 units on a site and not more than 4 acres in size which is within one-half mile of a major transit stop. [SB 1925 (Sher), Chapter 1039, Statutes of 2002]
6. The CEQA Guidelines further exempt infill projects meeting the following conditions:
   1. The project is consistent with the applicable general plan designation and all applicable general plan policies, as well as with applicable zoning designation and regulations.
   2. The proposed development occurs within city limits on a project site of no more than five acres substantially surrounded by urban uses.
   3. The project site has no value as habitat for endangered, rare, or threatened species.
   4. Approval of the project would not result in any significant effects relating to traffic, noise, air quality, or water quality.
   5. The site can be adequately served by all required utilities and public services.

FISCAL EFFECT: None

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 the project would not have 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, 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. Prior to approving any project that has received environmental review, an agency must make certain findings. 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.

CEQA includes various statutory exemptions, as well as categorical exemptions in the CEQA Guidelines. Since 1985, any residential development project can be exempt from CEQA if the project is consistent with a specific plan for which an EIR has been certified. In 2002, SB 1925 established CEQA exemptions for certain residential projects providing affordable urban or agricultural housing, or located on an infill site within an urbanized area and meeting specified unit and acreage criteria. For purposes of qualifying for the CEQA exemption for urban infill housing, projects must be within one-half mile of a major transit stop.

More recently, the Legislature has enacted CEQA exemptions and streamlining for residential and certain other projects in infill areas. SB 375 (2008) provided a CEQA exemption for a narrow set of eligible residential projects in infill areas adjacent to transit, as well as alternatives of abbreviated EIR and mitigated negative declaration review. SB 226 (2011) provided abbreviated CEQA review procedures for a broader set of urban infill projects, including retail, commercial, and public buildings, with no requirement regarding proximity to transit. SB 743 (2013) established a new exemption for residential, mixed-use, and "employment center" projects located within one-half mile of a major transit stop, if the project is consistent with an adopted specific plan and specified elements of a SB 375 strategy. SB 743 also required OPR to propose revisions to the CEQA Guidelines for transportation impacts to better support infill development.

SB 375 provide three alternative forms of relief for CEQA review of transit priority projects: exemption, sustainable communities environmental assessment, and abbreviated EIR. The amendments made by this bill apply to the latter two, but not to the exemption.

According to the author:

Past legislative efforts, such as SB 226, SB 375 and SB 743, have sought to update CEQA by creating exemptions and streamlining provisions for projects which meet specific criteria. The goals of those efforts were to maintain the integrity of CEQA, while recognizing that certain projects do not require as thorough review as others. These are projects which must be close to mass transit, promote smart growth strategies and are environmentally friendly.

These types of development pose significant challenges for both the developer/builder and for the city looking to approve them. Infill projects are complicated and face significant threats of litigation and other hurdles. This is because the nature of infill means that projects are surrounded by current residents, business or outside groups who may oppose the project despite its benefits to both the environment and the community. After many discussions with OPR, Infill Builders, the City of Sacramento, environmental and labor groups, we found that the use of a streamlined EIR is an effective way to reduce some of the CEQA burden on projects, while still maintaining an avenue for objections to be raised concerning individual projects.

A streamlined EIR, as allowed for transit priority projects, is a valuable tool for infill development. It carries the litigation protection as a full EIR, but is less expensive and less time consuming. It must still consider environmental impacts of a proposed project and must go through the public process for comments or revisions. By changing the requirements which have access to streamlined EIRs, cities may have the ability to attract more infill development.

This bill seeks to encourage more environmentally friendly infill development by making a slight change to [Public Resources Code] PRC 21155 to allow for more flexibility in project design, while still remaining within walking distance to high quality transit. It changes the current requirement of how much of an entire mixed use or residential infill project of no more than 200 residential units is within one-half mile from mass transit from 75% to 50%. This change only affects the non-residential pieces of a project. Current law would remain the same under this bill, that 90% of residential units be within one-half mile distance to mass transit.

Environmental groups opposed to the bill contend that the one-half-mile limit is not just about proximity of transit to housing, but also to jobs and retail:

AB 1886 maintains that no more than 10% of the residential units in the development, or 100 units, whichever is less, can be located more than one-half mile away from the transit station. We are pleased to see an effort to honor the original intent of SB 375, to locate the majority of residential units in walking distance from the transit stop. However, we are concerned about the impacts…on the commercial and retail portions of a project. A report on Transit Oriented Development published by the Public Policy Institute of California recommended a greater emphasis on locating commercial development and jobs near transit to reduce vehicle miles traveled and promote transit ridership. If the bulk of the jobs are located too far from a station for the transit to be a viable commuting option, this commercial development, while near transit, may not reduce vehicle miles traveled. Moreover, AB 1886 might result in more, larger projects that choose to locate the full 100 residential units more than one-half mile from transit, rendering transit a less viable option for these residents.

Analysis Prepared by: Lawrence Lingbloom / NAT. RES. / (916) 319-2092 FN: 0002980

Date of Hearing: May 3, 2016

ASSEMBLY COMMITTEE ON NATURAL RESOURCES

Das Williams, Chair

ABPCA Bill Id:AB 1886 (

Author:McCarty) – As Introduced Ver:February 11, 2016

SUBJECT: California Environmental Quality Act: transit priority projects

SUMMARY: Revises the definition of a "transit priority project" for purposes of qualifying for exemption or abbreviated review under the California Environmental Quality Act (CEQA) to permit up to 50% of the parcels within the project to be farther than 1/2 mile from a major transit stop or high-quality transit corridor, as defined.

EXISTING LAW:

1. CEQA requires lead agencies with the principal responsibility for carrying out or approving a proposed project to prepare a negative declaration, mitigated negative declaration, or environmental impact report (EIR) for this action, unless the project is exempt from CEQA. (CEQA includes various statutory exemptions, as well as categorical exemptions in the CEQA guidelines.)
   
2. Requires metropolitan planning organizations (MPOs) to include a sustainable communities strategy (SCS), as defined, in their regional transportation plans, or an alternative planning strategy (APS), for the purpose of reducing greenhouse gas (GHG) emissions; aligns planning for transportation and housing; and creates specified incentives for the implementation of the strategies, including CEQA exemption or abbreviated review for residential or mixed-use residential "transit priority projects," if the project is consistent with the use designation, density, building intensity, and applicable policies specified for the project area in either an approved SCS or APS. [SB 375 (Steinberg), Chapter 728, Statutes of 2008]
   1. Requires a "transit priority project" to meet the following conditions:
      1. Contain at least 50% residential use;
      2. Provide at least 20 dwellings per acre; and
      3. Be within 1/2 mile of a major transit stop or high-quality transit corridor. To qualify, all parcels within the project must have no more than 25% of their area farther than 1/2 mile from transit and not more than 10% of the residential units or 100 units, whichever is less, may be farther than 1/2 mile from transit.
         
   2. Defines "major transit stop" as a site containing an existing rail transit station, a ferry terminal served by either a bus or rail transit service, or the intersection of two or more major bus routes with a frequency of service interval of 15 minutes or less during the morning and afternoon peak commute periods.
   3. Defines "high-quality transit corridor" as a corridor with fixed route bus service with service intervals no longer than 15 minutes during peak commute hours. 
3. Establishes abbreviated CEQA review procedures for specified infill projects, where only specific or more significant effects on the environment which were not addressed in a prior planning-level EIR need be addressed. An EIR for such a project need not consider alternative locations, densities, and building intensities or growth-inducing impacts. Infill projects may include residential, retail, commercial, transit station, school, or public office building projects located within an urban area. [SB 226 (Simitian), Chapter 469, Statutes of 2011] SB 226 requires the Office of Planning and Research (OPR) to develop CEQA guidelines to implement its infill provisions, including statewide standards to promote smart growth, reduction of GHG emissions, reduction in water use, energy efficiency improvements, and protection of public health.
4. Exempts from CEQA residential, mixed-use, and "employment center" projects, as defined, located in "transit priority areas" within one-half mile of an existing or planned major transit stop, if the project is consistent with an adopted specific plan and specified elements of a SCS or APS adopted pursuant to SB 375. [SB 743 (Steinberg), Chapter 386, Statutes of 2013]
5. Exempts from CEQA specified residential housing projects which meet detailed criteria established to ensure the project does not have a significant effect on the environment, including urban infill housing projects not more than 100 units on a site and not more than 4 acres in size which is within 1/2 mile of a major transit stop. [SB 1925 (Sher), Chapter 1039, Statutes of 2002]
6. The CEQA Guidelines further exempt infill projects meeting the following conditions:
   1. The project is consistent with the applicable general plan designation and all applicable general plan policies, as well as with applicable zoning designation and regulations.
   2. The proposed development occurs within city limits on a project site of no more than five acres substantially surrounded by urban uses.
   3. The project site has no value as habitat for endangered, rare, or threatened species.
   4. Approval of the project would not result in any significant effects relating to traffic, noise, air quality, or water quality.
   5. The site can be adequately served by all required utilities and public services.

THIS BILL revises the definition of a "transit priority project" for purposes of the SCS provisions of CEQA to permit up to 50% of the area of parcels within the project to be farther than 1/2 mile from a major transit stop or high-quality transit corridor.

FISCAL EFFECT: Non-fiscal

COMMENTS:

1. Background. 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 the project would not have 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, 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. Prior to approving any project that has received environmental review, an agency must make certain findings. 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.

CEQA includes various statutory exemptions, as well as categorical exemptions in the CEQA Guidelines. Since 1985, any residential development project can be exempt from CEQA if the project is consistent with a specific plan for which an EIR has been certified. In 2002, SB 1925 established CEQA exemptions for certain residential projects providing affordable urban or agricultural housing, or located on an infill site within an urbanized area and meeting specified unit and acreage criteria. For purposes of qualifying for the CEQA exemption for urban infill housing, projects must be within one-half mile of a major transit stop.

More recently, the Legislature has enacted CEQA exemptions and streamlining for residential and certain other projects in infill areas.  SB 375 (2008) provided a CEQA exemption for a narrow set of eligible residential projects in infill areas adjacent to transit, as well as alternatives of abbreviated EIR and mitigated negative declaration review.  SB 226 (2011) provided abbreviated CEQA review procedures for a broader set of urban infill projects, including retail, commercial, and public buildings, with no requirement regarding proximity to transit.  SB 743 (2013) established a new exemption for residential, mixed-use, and "employment center" projects located within one-half mile of a major transit stop, if the project is consistent with an adopted specific plan and specified elements of a SB 375 strategy.  SB 743 also required OPR to propose revisions to the CEQA Guidelines for transportation impacts to better support infill development.

1. Author's statement:

Past legislative efforts, such as SB 226, SB 375 and SB 743, have sought to update CEQA by creating exemptions and streamlining provisions for projects which meet specific criteria. The goals of those efforts were to maintain the integrity of CEQA, while recognizing that certain projects do not require as thorough review as others. These are projects which must be close to mass transit, promote smart growth strategies and are environmentally friendly.

These types of development pose significant challenges for both the developer/builder and for the city looking to approve them. Infill projects are complicated and face significant threats of litigation and other hurdles. This is because the nature of infill means that projects are surrounded by current residents, business or outside groups who may oppose the project despite its benefits to both the environment and the community. After many discussions with the Governor’s Office of Planning and Research, Infill Builders, the City of Sacramento, environmental and labor groups, we found that the use of a streamlined EIR (PRC 21155.2) or the CEQA exemption after a public hearing (PRC 21155.1) is an effective way to reduce some of the CEQA burden on projects, while still maintaining an avenue for objections to be raised concerning individual projects.

A streamlined EIR, as allowed for transit priority projects (PRC 21155.2), is a valuable tool for infill development. It carries the litigation protection as a full EIR, but is less expensive and less time consuming. It must still consider environmental impacts of a proposed project and must go through the public process for comments or revisions. By changing the requirements which have access to streamlined EIRs, cities may have the ability to attract more infill development.

This bill seeks to encourage more environmentally friendly infill development by making a slight change to PRC 21155 to allow for more flexibility in project design, while still remaining within walking distance to high quality transit. It changes the current requirement of how much of an entire mixed use or residential infill project of no more than 200 residential units is within a ½ mile from mass transit from 75% to 50%. This change only affects the non-residential pieces of a project. Current law would remain the same under this bill, that 90% of residential units be within ½ mile distance to mass transit.

1. Three forms of relief. SB 375 provide three alternative forms of relief for CEQA review of transit priority projects:
   1. Exemption (Section 21155.1). This requires a hearing and findings by the public agency that the project meets specified criteria, including a variety of conditions to assure the project has no significant environmental impacts. The project must also be located within one-half mile of a rail transit station or ferry terminal, or within one-quarter mile of a high-quality transit corridor.
   2. Sustainable communities environmental assessment [Section 21155.2(b)]. This is equivalent to a mitigated negative declaration, except that the lead agency's actions are subject to a more deferential standard of review (substantial evidence rather than fair argument).
   3. Abbreviated EIR [Section 21155.2(c)]. This limits the consideration of cumulative impacts and does not require analysis of off-site alternatives to the project.
2. Opposition argument. Environmental groups opposed to the bill contend that the half-mile limit is not just about proximity of transit to housing, but also to jobs and retail:

AB 1886 maintains that no more than 10 percent of the residential units in the development, or 100 units, whichever is less, can be located more than one-half mile away from the transit station. We are pleased to see an effort to honor the original intent of SB 375, to locate the majority of residential units in walking distance from the transit stop. However, we are concerned about the impacts…on the commercial and retail portions of a project. A report on Transit Oriented Development published by the Public Policy Institute of California recommended a greater emphasis on locating commercial development and jobs near transit to reduce vehicle miles traveled and promote transit ridership. If the bulk of the jobs are located too far from a station for the transit to be a viable commuting option, this commercial development, while near transit, may not reduce vehicle miles traveled. Moreover, AB 1886 might result in more, larger projects that choose to locate the full 100 residential units more than one-half mile from transit, rendering transit a less viable option for these residents.

1. OPR survey indicates CEQA is not a significant barrier to infill projects. OPR's "2012 Annual Planning Survey Results" asked city and county planners to explain the primary barriers their jurisdictions have experienced to implementing infill projects. Based on 238 responses, 25% of jurisdictions reported that infrastructure constraints were a primary barrier to implementing infill projects. Just under 25% reported that they had problems with assembling parcels of the right size and configuration for infill development. Only 4% of respondents identified CEQA as a barrier.
2. Suggested amendment. The author and the committee may wish to consider amending the bill to clarify that the changes to the one-half mile limit do not apply to the exemption (Section 21155.1), which has its own, more-stringent transit proximity requirements.

REGISTERED SUPPORT / OPPOSITION:

Support

Association of Environmental Professionals

California Association of Realtors

Opposition

California Bicycle Coalition

California League of Conservation Voters

Natural Resources Defense Council

Safe Routes to School National Partnership

Sierra Club California

Analysis Prepared by: Lawrence Lingbloom / NAT. RES. / (916) 319-2092