Hollywoodians Encouraging Rental Opportunities v. City of L. A., B285553

• Court: California Court of Appeals
• Writing for the Court: EDMON, P. J.
• Citation: 250 Cal.Rptr.3d 108,37 Cal.App.5th 768
• Parties: HOLLYWOODIANS ENCOURAGING RENTAL OPPORTUNITIES (HERO) et al., Plaintiffs and Appellants, v. CITY OF LOS ANGELES et al., Defendants and Respondents; Millennium Settlement Consulting / 1850 North Cherokee, LLC et al., Real Parties in Interest and Respondents.
• Docket Number: B285553
• Decision Date: 28 June 2019

37 Cal.App.5th 768
250 Cal.Rptr.3d 108

HOLLYWOODIANS ENCOURAGING RENTAL OPPORTUNITIES (HERO) et al., Plaintiffs and Appellants,
v.
CITY OF LOS ANGELES et al., Defendants and Respondents;

Millennium Settlement Consulting / 1850 North Cherokee, LLC et al., Real Parties in Interest and Respondents.

B285553

Court of Appeal, Second District, Division 3, California.

Filed June 28, 2019

Certified for Partial Publication.^*

Angel Law, Frank P. Angel, and Ellis Raskin, Santa Monica, for Plaintiffs and Appellants.

Advocates for the Environment, Dean Wallraff and Kathleen R. Unger, Los Angeles, for Affordable Housing Preservation Advocates, as Amicus Curiae on behalf of Plaintiffs and Appellants.

Eviction Defense Network, Elena I. Popp, and Sean Chandra, Los Angeles, for Los Angeles Tenants Union, Public Counsel, National Lawyers Guild, Western Center on Law and Poverty, Strategic Actions for a Just Economy, and Anti-Eviction Mapping Project, as Amici Curiae on behalf of Plaintiffs and Appellants.

Remy Moose Manley, Sabrina V. Teller, Sacramento, and Christina L. Berglund; Michael N. Feuer, City Attorney, and Oscar Medellin, Deputy City Attorney, for Defendants and Respondents.

Jeffer Mangels Butler & Mitchell, and Matthew D. Hinks, Los Angeles, for Real Parties in Interest and Respondents.

EDMON, P. J.

37 Cal.App.5th 772

Plaintiffs and appellants Hollywoodians Encouraging Rental Opportunities (HERO), Sylvie Shain (Shain), and Max Blonde (Blonde) (sometimes collectively referred to as HERO) appeal a judgment denying their petition for writ of mandate. HERO's petition sought to set aside actions taken by defendants and respondents City of Los Angeles, City Council of the City of Los Angeles (City Council), and Central Los Angeles Area Planning Commission (Commission) (collectively, the City) in approving a proposal by real parties in interest and respondents Millennium Settlement Consulting/1850 North Cherokee, LLC, Lesser Investment Company, L.P., and David Lesser (collectively, the owner) to convert a vacant 18-unit apartment building into a boutique hotel.

In this case involving the California Environmental Quality Act (CEQA) (

250 Cal.Rptr.3d 111

Pub. Resources Code, § 21000 et seq. ),¹ the essential issue presented is

37 Cal.App.5th 773

whether the City erred in failing to prepare an environmental impact report (EIR) to assess the loss of affordable housing and displacement of tenants that would result from the conversion of the former apartment building into a hotel.

Because the building at issue had been withdrawn from the rental market years before the City commenced environmental review for the hotel project, we conclude there were no housing-related impacts or displacement of tenants for the City to address in an EIR. We also reject HERO's other contentions and affirm the judgment denying the petition for writ of mandate.

OVERVIEW OF CEQA

" ‘In CEQA, the Legislature sought to protect the environment by the establishment of administrative procedures drafted to "[e]nsure that the long-term protection of the environment shall be the guiding criterion in public decisions." ’ [Citation.] At the ‘heart of CEQA’ (CEQA Guidelines, § 15003, subd. (a))^{[2 ]} is the requirement that public agencies prepare an EIR for any ‘project’ that ‘may have a significant effect on the environment.’ [Citations.] The purpose of the EIR is ‘to provide public agencies and the public in general with detailed information about the effect which a proposed project is likely to have on the environment; to list ways in which the significant effects of such a project might be minimized; and to indicate alternatives to such a project.’ [Citation.] The EIR thus works to ‘inform the public and its responsible officials of the environmental consequences of their decisions before they are made,’ thereby protecting ‘ "not only the environment but also informed self-government." ’ [Citations.]" ( Friends of College of San Mateo Gardens v. San Mateo County Community College Dist. (2016) 1 Cal.5th 937, 944–945, 207 Cal.Rptr.3d 314, 378 P.3d 687 ( San Mateo ).)

Under "CEQA and its implementing guidelines, an agency generally conducts an initial study to determine ‘if the project may have a significant effect on the environment.’^{[3 ]} [Citation.] If there is substantial evidence that the project may have a significant effect on the environment, then the agency must prepare and certify an EIR before approving the project. [Citations.] On the other hand, no EIR is required if the initial study reveals that ‘there is no substantial evidence that the project or any of its aspects may cause a significant effect on the environment.’ [Citation.] The agency instead prepares

37 Cal.App.5th 774

a negative declaration ‘briefly describing the reasons that a proposed project ... will not have a significant effect on the environment and therefore does not require the preparation of an EIR.’ [Citations.] Even when an initial study shows a project may have significant environmental effects, an EIR is not always required. The public agency may instead prepare a mitigated negative declaration (MND) if ‘(1) revisions in the project plans ... before the proposed negative declaration and initial study are released for public review would avoid the effects or mitigate the effects to a point where clearly no significant effect on the environment would occur, and (2)

250 Cal.Rptr.3d 112

there is no substantial evidence in light of the whole record before the public agency that the project, as revised, may have a significant effect on the environment.’ [Citation.]" ( San Mateo , supra , 1 Cal.5th at p. 945, 207 Cal.Rptr.3d 314, 378 P.3d 687.)

Here, the City's decision to adopt an MND rather than to prepare an EIR is the focus of this controversy.

FACTUAL AND PROCEDURAL BACKGROUND

1. Events leading up to the City's approval of the conversion of the subject property to use as a 24-room boutique hotel.

The subject real property, located at 1850 North Cherokee Avenue in the Hollywood area of Los Angeles, is a now-vacant 18-unit apartment building built in 1939, which was subject to the City's Rent Stabilization Ordinance (RSO) (Los Angeles Mun. Code (LAMC) § 151.00 et seq.). In 2009, the owner filed a land use application with the City to demolish the building and replace it with a 39-unit residential condominium project. In July 2009, the City Council adopted an MND pursuant to CEQA, finding that the condominium project would not have a significant effect on the environment.

In May 2013, the owner filed a notice of intent to withdraw all 18 units from rental housing use pursuant to the Ellis Act. ( Gov. Code, § 7060 et seq. )⁴ By October 2013, all the rental units had been vacated. The City then approved the building for demolition. In early 2014, however, the developer backed out due to a lack of financing, putting an end to the condominium project.

In July 2015, the owner submitted to the City an application for the hotel project at issue in this appeal (the Project), seeking to convert the property

37 Cal.App.5th 775

into a boutique hotel with 24 guest rooms. The owner requested the following approvals: a conditional use permit (CUP) to allow the operation of the hotel in an R4 zone; a zone variance to provide off-site parking in excess of 750 feet from the proposed hotel; and a rear yard adjustment.

Pursuant to CEQA, the City prepared an initial study of the hotel Project to evaluate its potential environmental impacts. The initial study determined that the Project would result in potentially significant effects relating to aesthetics, biological resources, noise and public services, but concluded that with mitigation measures, the potential impacts would be mitigated to less-than-significant levels. For all remaining impact categories, including population and housing, and cumulative impacts, the initial study concluded the Project would cause either a less than significant impact or no impact.

With respect to population and housing, the initial study concluded that converting the building to a hotel would not displace housing units or residents because the apartment units had been withdrawn from the rental market in May 2013 and the building was vacant. The initial study also found that the Project did not meet the minimum threshold of 25 multi-family units that had been adopted by the City as

250 Cal.Rptr.3d 113

creating a potential impact.⁵ Therefore, the initial study concluded that no additional analysis was required with respect to the Project's impact on population and housing.

Following a public hearing, on December 21, 2015, the Zoning Administrator adopted an MND (the 2015 MND) that had been issued by the City Planning Department. The Zoning Administrator also approved the requested CUP, a zone variance to permit off-site parking, and an adjustment to permit a 9-foot,...