Caretakers v. City of Santa Cruz, H037545

• Decision Date: 19 February 2013
• Docket Number: H037545
• Parties: HABITAT AND WATERSHED CARETAKERS, Plaintiff and Appellant, v. CITY OF SANTA CRUZ et al., Defendants and Respondents; REGENTS OF THE UNIVERSITY OF CALIFORNIA, Real Party in Interest and Respondent.
• Court: California Court of Appeals Court of Appeals

HABITAT AND WATERSHED CARETAKERS, Plaintiff and Appellant, v. CITY OF SANTA CRUZ et al., Defendants and Respondents;

REGENTS OF THE UNIVERSITY OF CALIFORNIA, Real Party in Interest and Respondent.

H037545

COURT OF APPEAL OF THE STATE OF CALIFORNIA SIXTH APPELLATE DISTRICT

Filed: February 19, 2013

CERTIFIED FOR PUBLICATION

(Santa Cruz County

Super. Ct. No. CV168697)

Appellant Habitat and Watershed Caretakers (Habitat) challenges the trial court's denial of its mandate petition. Habitat's petition contended that respondent City of Santa Cruz (the City) had failed to comply with the California Environmental Quality Act (CEQA) (Pub. Resources Code, § 21000 et seq.). The City had certified an environmental impact report (EIR) for a project to seek an amendment of the City's sphere of influence (SOI) to include an undeveloped portion of the University of California, Santa Cruz (UCSC) campus known as "North Campus" so as to permit the City to provide extraterritorial water and sewer services to proposed new development in North Campus.

A sphere of influence is "a plan for the probable physical boundaries and service area of a local agency, as determined by the [local agency formation commission]." (Gov. Code, § 56076.) The Legislature has vested each county's local agency formation commission (LAFCO) with the power and duty to "approve with or without amendment, wholly, partially, or conditionally, or disapprove" a city's request for an SOI amendment. (Gov. Code, § 56428, subd. (e).) LAFCO's authority over a city's sphere of influence is guided by, among other factors, the capacity and adequacy of the services that the city has the ability to provide. (Gov. Code, § 56425, subd. (e)(3).) LAFCO also controls a city's authority to provide services outside its jurisdictional limits. (Gov. Code, § 56375, subd. (p).) "A city or district may provide new or extended services by contract or agreement outside its jurisdictional boundaries only if it first requests and receives written approval from [LAFCO]." (Gov. Code, § 56133, subd. (a).) LAFCO "shall approve, disapprove, or approve with conditions the contract for extended services." (Gov. Code, § 56133, subd. (d).) With certain exceptions not relevant here, a city may provide such services outside its jurisdictional boundaries only if the services will be provided "within its sphere of influence in anticipation of a later change of organization." (Gov. Code, § 56133, subd. (b).) The City's project therefore required LAFCO approval of both the City's application for the SOI amendment and a concurrent application by real party in interest the Regents of the University of California (the Regents) for approval of its agreement with the City for extraterritorial water and sewer services for North Campus.

Habitat asserts that the City's environmental review of the project violated CEQA. It argues that the EIR (1) did not adequately discuss and analyze the impacts of the project on water supply, watershed resources, biological resources, and indirect growth, (2) misdescribed the project's objectives, (3) failed to consider and analyze a reasonable range of alternatives, and (4) failed to provide adequate mitigation measures. Habitat also maintains that the City failed to make sufficient findings and failed to provide anadequate statement of overriding considerations. We find no significant inadequacies in the EIR's discussion and analysis of the impacts of the project, description of the project's objectives, mitigation measures, findings, and statement of overriding considerations. However, we conclude that the City's EIR was inadequate because it failed to consider and discuss any feasible alternative, such as a limited-water alternative, that could avoid or lessen the significant environmental impact of the project on the City's water supply. Consequently, we reverse.

I. Background

The City has long suffered from a water supply deficit in dry years. It has considered and rejected many alternative sources of water as infeasible, and its current long-term plan is to construct a desalination facility. The City's plans for a desalination facility are in their infancy.

In 2006, the Regents adopted the 2005 Long Range Development Plan (LRDP) for UCSC. The LRDP contemplated the development of North Campus. North Campus is not within the City's territorial boundaries or sphere of influence. North Campus is in an unincorporated area of the County of Santa Cruz (the County). A CEQA action brought by the City, the County, and other parties challenged the Regents' certification of an EIR for the LRDP and the Regents' adoption of the LRDP.

In August 2008, the City, the Regents, and the other parties to the litigation over the LRDP entered into a comprehensive settlement agreement (the CSA) resolving that action and other litigation concerning UCSC development. Under the CSA, the Regents made various commitments, including restrictions on enrollment and provisions for increasing on-campus housing. The housing commitment was contingent on the City seeking LAFCO approval of an SOI amendment and agreeing not to oppose the Regents'request for extraterritorial water and sewer services for North Campus.¹ The CSA provided that a LAFCO denial would excuse the Regents from the housing commitment.²

The CSA was incorporated by stipulation into the superior court's September 2008 judgment in the action regarding the LRDP. In October 2008, the City sent a letter to LAFCO informing LAFCO that it had agreed to provide extraterritorial water and sewer services to North Campus. The City filed an application for an SOI amendment with LAFCO, and the Regents filed an application for the provision of extraterritorial waterand sewer services. (See Community Water Coalition v. Santa Cruz County Local Agency Formation Com. (2011) 200 Cal.App.4th 1317, 1321.) While these applications were pending, the City prepared a draft EIR for the project.

The draft EIR found one significant and unavoidable direct impact. "The proposed project would result in future provision of water service to the North Campus portion of the UCSC campus that would support new planned development and growth to the year 2020. There are inadequate water supplies to serve the project under existing and future multiple dry year (drought) conditions."³ The draft EIR also found that there were other significant secondary impacts, including the impact on biological resources, but it concluded that these other impacts generally could be mitigated to insignificance. Some of the indirect impacts of UCSC growth were found to be unavoidable, but, other than erosion, those impacts are not at issue in this action. The draft EIR noted that "[i]mplementation of the proposed project [providing water and sewer services to North Campus] would enable UCSC to move forward with plans to develop the North Campus" under the LRDP. After receiving and responding to the comments on the draft EIR, the City certified in August 2010 that the final EIR complied with CEQA.

Habitat filed a petition challenging the City's certification of the final EIR. It alleged that the City had violated CEQA because it (1) did not adequately discuss the project's environmental impacts, (2) failed to identify and discuss a reasonable range of alternatives, and (3) failed to propose adequate mitigation measures. Habitat also contended that the City violated CEQA by making inadequate findings and approving an inadequate statement of overriding considerations. The trial court denied the petition. Habitat timely filed a notice of appeal.

II. Discussion

A. Standard of Review

"We may not set aside an agency's approval of an EIR on the ground that an opposite conclusion would have been equally or more reasonable. 'Our limited function is consistent with the principle that "[t]he purpose of CEQA is not to generate paper, but to compel government at all levels to make decisions with environmental consequences in mind. CEQA does not, indeed cannot, guarantee that these decisions will always be those which favor environmental considerations." ' [Citations.] We may not, in sum, substitute our judgment for that of the people and their local representatives. We can and must, however, scrupulously enforce all legislatively mandated CEQA requirements." (Citizens of Goleta Valley v. Board of Supervisors (1990) 52 Cal.3d 553, 564 (Goleta II).)

Judicial review of an agency's decision to certify an EIR and approve a project "shall extend only to whether there was a prejudicial abuse of discretion. Abuse of discretion is established if the agency has not proceeded in a manner required by law or if the determination or decision is not supported by substantial evidence." (Pub. Resources Code, § 21168.5; Laurel Heights Improvement Assn. v. Regents of University of California (1988) 47 Cal.3d 376, 392, fn. 5 (Laurel Heights).) "Noncompliance with substantive requirements of CEQA or noncompliance with information disclosure provisions 'which precludes relevant information from being presented to the public agency . . . may constitute prejudicial abuse of discretion within the meaning of Sections 21168 and 21168.5, regardless of whether a different outcome would have resulted if the public agency had complied with those provisions.' (§ 21005, subd. (a).) In other words, when an agency fails to proceed as required by CEQA, harmless error analysis is inapplicable. The failure to comply with the law subverts the purposes of CEQA if it omits material necessary to informed decisionmaking and informed public participation." (County of Amador v. El Dorado County Water Agency (1999) 76 Cal.App.4th 931, 946.)

B. Assessment of Impacts

Habitat contends that the final EIR did not adequately assess the environmental impact of the project on water supply, watershed resources, biological resources, and indirect growth.

1. Water Supply

a. Background

The draft EIR extensively described the City's water supply situation. The City...