Cal. Tahoe Regional Planning v. Sahara Tahoe Corp.

• Decision Date: 20 February 1981
• Docket Number: CIV-R-79-156-ECR.,No. CIV-R-79-9-ECR,CIV-R-79-9-ECR
• Citation: 504 F. Supp. 753
• Parties: CALIFORNIA TAHOE REGIONAL PLANNING AGENCY et al., Plaintiffs, v. SAHARA TAHOE CORPORATION et al., (2 cases), Defendants.
• Court: U.S. District Court — District of Nevada

504 F. Supp. 753

CALIFORNIA TAHOE REGIONAL PLANNING AGENCY et al., Plaintiffs, v. SAHARA TAHOE CORPORATION et al., (2 cases), Defendants.

Nos. CIV-R-79-9-ECR, CIV-R-79-156-ECR.

United States District Court, D. Nevada.

October 29, 1980.

As Amended February 20, 1981.

Joel Moskowitz, Asst. Atty. Gen., San Francisco, Cal., for CTRPA and State of California.

Joseph C. Easley, Bruce A. Behrens, Sacramento, Cal., for Calif. Dept. of Transportation.

John Frankovich, Reno, Nev., for Sahara Tahoe Corp.

Gary A. Owen, Zephyr Cove, Nev., for TRPA, Cooke, Kjer, Bensinger, Stoess, Meder, Henry, Woods, Singer, Stewart and Steele.

Michael Smiley Rowe, Dist. Atty., Minden, Nev., for Douglas County.

MEMORANDUM DECISION

EDWARD C. REED, Jr., District Judge.

These cases involve the proposed construction of a six-level parking garage by defendant, Sahara Tahoe Corp. (Sahara), on the south shore of Lake Tahoe in Nevada. Plaintiffs, the State of California and the California Tahoe Regional Planning Agency, (Cal-TRPA), seek to enjoin the proposed construction.

The actions were consolidated for further proceedings by order of this Court on June 20, 1980. The parties are presently before the Court on a motion for summary judgment, or alternatively judgment on the pleadings, filed on behalf of plaintiffs and a motion to dismiss filed on behalf of Sahara. Sahara's motion to dismiss is being treated as a motion for summary judgment pursuant to Rule 12(b) and Rule 56 F.R.C.P.

Jurisdiction of the Court is based on federal questions, 28 U.S.C. § 1331(a), and the Court's pendent jurisdiction. Resolution of the case is substantially dependent upon the interpretation of 42 U.S.C. § 7410 (a)(5)(A)(iii) and 42 U.S.C. § 7604(a) of the Clean Air Act. In addition, because plaintiffs allege that the actions of defendants Tahoe Regional Planning Agency (TRPA) and Douglas County (County) pursuant to the TRPA Land Use Ordinance will substantially affect the effective functioning of the Tahoe Regional Planning Compact (Compact), the Court has independent federal question jurisdiction to review such actions. League to Save Lake Tahoe v. B.J.K. Corporation, 547 F.2d 1072 (1976).

FACTUAL AND PROCEDURAL BACKGROUND

The present litigation finds its origins in a more basic controversy between the states of Nevada and California. The two have previously been at odds with each other over the extent to which future development is to be permitted in the Lake Tahoe basin.

In the hopes of compromising their divergent views, the states entered into an interstate compact, the Tahoe Regional Planning Compact, creating TRPA.¹ NRS 277.190, et seq., and Calif. Gov. Code § 66800, et seq. TRPA was given the power to "adopt and enforce a regional plan of resource conservation and orderly development." With voting members from both states on TRPA's governing board,² it was hoped that the interests and goals of both states could be protected and achieved. Unfortunately, since development is continuing in the Tahoe basin at a rate apparently more rapid that California interests desire, California has not been pleased with the results.

The controversy before the Court involves one of several cases in which California is attempting to halt development in the basin by the Nevada gaming industry. On September 22, 1978, defendant Sahara filed an application with defendant Douglas County (County) for a special use permit for the construction of a six-level parking garage to accommodate 2,100 vehicles. Following public hearings on October 5, 1978, the County approved the project without modification. The application was subsequently placed on TRPA's agenda and formal approval by a dual majority (a majority of the voting members of each state) was given on December 20, 1978.³ The approval was made subject to the condition or modification that Sahara remove 458 existing surface parking spaces from the site, and replant the area with vegetation chosen to conform with the natural vegetation of the area.

Shortly after this approval, on January 15, 1979, the State of California and the California Tahoe Regional Planning Agency (Cal-TRPA), filed their first suit to enjoin the Sahara project. Cal-TRPA v. Sahara Tahoe Inc., et al., CIV-R-79-9-ECR (D.Nev., filed Jan. 15, 1979). The plaintiffs alleged that neither the County nor TRPA considered whether the proposed project was in compliance with TRPA ordinance No. 78-5;⁴ that the County and TRPA failed to make findings required of them by Section 8.33 of TRPA's Land Use Ordinance;⁵ that TRPA was required to comply with the National Environmental Policy Act (NEPA), 42 U.S.C. § 4321, et seq., and failed to do so;⁶ that TRPA was required to comply with the provisions of the California Environmental Quality Act (CEQA), Calif. Pub. Resources Code § 21000, et seq., and failed to do so;⁷ that the proposed project would constitute an interstate nuisance; and finally that Sahara's project constituted a complex source of air pollution within the meaning of the federally approved Nevada State Implementation Plan (40 C.F.R. 52.1470 et seq.), thus requiring Sahara to apply for and obtain an Air Registration Certificate (ARC).⁸

Sahara responded on March 19, 1979, with a motion to dismiss for lack of subject matter jurisdiction, Rule 12(b)(1) F.R.Civ.P., and failure to state a claim for which relief can be granted, Rule 12(b)(6) F.R.Civ.P.

In turn, plaintiffs filed an amended complaint with four additional causes of action: a claim that members of the TRPA accepted income from the defendant Sahara and subsequently voted on Sahara's project in violation of California's Political Reform Act of 1974;⁹ a claim that by virtue of receipt of said income plaintiffs were deprived of a fair hearing in violation of plaintiffs' due process rights; a request that Douglas Costle (Costle) as Administrator of the Environmental Protection Agency (EPA), be compelled to maintain the provisions of Nevada's Complex Source Regulations in its SIP until such time as the Implementation Plan, absent such regulations, meets Federal ambient air quality standards; and finally a cause of action seeking declaratory relief with respect to the rights and duties of the parties in this regard.¹⁰ Sahara has also moved to dismiss the amended complaint.

Meanwhile on another front, Sahara attempted to recoup reverses suffered at the December 20, 1978, hearing of the TRPA. On February 26, 1979, the defendant filed a new application for an administrative permit with Douglas County to construct a parking garage, an application identical to the one the County previously approved and that TRPA subsequently approved and modified. Douglas County again approved the application as made and again forwarded it to the TRPA for review. At the June 27, 1979, meeting of the TRPA board, TRPA, viewing Sahara's second application as identical to its predecessor, treated the application as a request to reconsider and denied reconsideration. In denying reconsideration, a dual majority specifically found that the action it had taken December 20, 1978, was TRPA's final action on the project.

Following this action on Sahara's second application, Cal-TRPA initiated another lawsuit against Sahara (CIV-R-79-156-ECR) in which Douglas Costle was named as a defendant along with Douglas County.¹¹

Most recently, on January 3, 1980, California filed a motion for judgment on the pleadings or in the alternative for summary judgment in 79-9 and 79-156. The motion was based on a recent decision in the Second Circuit, Manchester Environmental Coalition v. Environmental Protection Agency, 612 F.2d 56 (2nd Cir. 1979). In that case it was held that any revision of a state implementation plan (SIP) must comply with substantive as well as procedural requirements of the Clean Air Act.¹²

We now proceed with the resolution of the issues before the Court.

THE ISSUE RELATING TO ORDINANCE NO. 78-5

The First and Third Claims for relief in plaintiffs' amended complaint in 79-9 and the Second Claim in 79-156 involve TRPA Ordinance No. 78-5. In the First Claim in 79-9 and the Second Claim in 79-156, plaintiffs allege that Douglas County gave its approval to the Sahara project without considering 78-5 as required under Article VI(b) of the Compact.¹³ The Third Claim in 79-9 asserts that when the permit application was subsequently forwarded to TRPA, that agency also failed to hold hearings and make findings as required by 78-5. All defendants contend that Sahara's parking garage is exempt from Ordinance 78-5.

The Clean Air Act, 42 U.S.C. § 7410(a)(2)(I) requires states to adopt so-called nonattainment plans for the achievement of the national ambient air quality standard in their nonattainment areas as a precondition to the construction or modification of any major stationary source of pollution. (Nonattainment areas are those areas within a state which do not meet the minimum national ambient air quality standards set by the EPA.) Both the State of California and the State of Nevada designated those parts of the Tahoe basin within their respective states nonattainment areas. Pursuant to such designation, Governor O'Callaghan, then Governor of Nevada, named TRPA as the agency to prepare the required nonattainment plan for the portion of the Tahoe basin lying within the State of Nevada. Governor O'Callaghan requested that TRPA defer certain traffic inducing projects from consideration for approval, pending completion of the plan. In response to his request, TRPA adopted Ordinance No. 78-5 on March 23, 1978. The ordinance placed a temporary moratorium on the construction of all projects that would result in the creation of more than 105 additional vehicle trips per day per acre of land within any particular development. Exempt from 78-5 were all applications received by the counties in the basin or TRPA before 5:00 p. m., March 22, 1978.

Defendants contend that Sahara's parking garage project was grandfathered in under...