Major Victory for Habitat Conservation Planning: California Appeals Court Denies CEQA and CESA Challenge to Natomas Basin Habitat Conservation Plan

By Stephanie Helfrich

In what can be characterized as a win for habitat conservation planning generally, and for development in the Natomas Basin specifically, California’s Third Appellate District has just published its August 9, 2006 decision, Environmental Council of Sacramento v. City of Sacramento et al., affirming the trial court’s conclusion that the city of Sacramento and Sutter County’s certification of the Environmental Impact Report (EIR) for the 2003 Natomas Basin Habitat Conservation Plan fully accounted for the environmental consequences of the HCP and implementation agreement under the California Environmental Quality Act (CEQA), and that the Department of Fish and Game met its responsibilities to protect threatened species through issuance of incidental take permits for the HCP under the California Endangered Species Act (CESA). The court concluded that plaintiffs failed to show an abuse of discretion under either statute.

A federal court challenge to a 1997 HCP for the same area found the federal permits inadequate,[1] and the HCP was redrafted to improve the conservation plan and to repair the federal deficiencies. After failing to invalidate the federal permits for the 2003 HCP,[2] plaintiff environmental groups challenged the state agencies’ role in the 2003 HCP. The appeals court denied plaintiffs’ petition for a writ of mandate because the court found substantial evidence to support each of the state agencies’ findings.

The court found many of plaintiffs’ arguments to be redundant, essentially consisting of three allegations: 1) the agencies failed to consider the cumulative impacts of development contemplated in the area in light of a contemporaneous Memorandum of Understanding (MOU) between the city and the County of Sacramento; 2) the mitigation measures for anticipated take required by the HCP were impermissibly unfunded, voluntary, unenforceable, and infeasible; and 3) the HCP’s 0.5:1 ratio for the purchase of mitigation land was indefensible.

On the issue of cumulative impacts, the appeals court determined that, as a “roadmap” to guide future land use decisions the MOU at issue does not waive any existing land use requirements but explicitly contemplates the necessity for further discretionary approvals and environmental review for development outside the HCP area. The appeals court agreed with the trial court and the federal district court that an environmental analysis of the unspecified and uncertain development that might be approved in the future under the MOU would be "speculative, wasteful, and of little value to the consumers of the EIR." The court concluded that the EIR for the HCP appropriately analyzed the cumulative effects of all past, present, and reasonably foreseeable development.

The court similarly concluded that CESA, like CEQA, "does not require wasteful speculation on potential projects yet to be conceived and described" and that the Department "would be forced to hypothesize an endless number of scenarios" in assessing "known threats" to species under CESA if the Department were required to treat the MOU as a proposed project or a pending application for incidental take with reasonably foreseeable impacts on hawks and snakes.

The court went on to chastise plaintiffs for confusing allowed baseline condition assumptions in the EIR and HCP with required mitigation in plaintiffs’ allegations that the mitigation measures remain unfunded, voluntary, and unenforceable. The court reasoned that, under CEQA, a public agency can make reasonable assumptions based on substantial evidence about future conditions without guaranteeing that those assumptions will remain true. The court specifically discussed that any future development of lands outside the HCP area assumed by the EIR and HCP to remain agricultural habitat for the hawks, or closing of canals and ditches assumed by the EIR and HCP to be accessible to the snakes, will require additional environmental review for impacts to those species. With extensive discussion of the details of the required mitigation in the HCP, the court concluded that the conservation plan presented by the HCP comprehensively addressed the minimization and mitigation measures required under CESA, adequately ensuring that feasible mitigation measures will actually be implemented as a condition of development, not merely adopted and then neglected or disregarded.

Finally, plaintiffs challenged the 0.5:1 mitigation ratio included in the HCP (the purchase of one-half acre of habitat reserves for every acre developed, irrespective of the habitat quality of the land to be developed), accusing the agencies of hypocrisy for contemplating a higher mitigation ratio of 1:1 as feasible in the MOU yet infeasible in the HCP. The court rejected this assertion, reasoning that “adherence to alleged ‘historic ratios’ is not required by CEQA, which does not mandate similar mitigation for all similar projects.” Noting that CEQA requires mitigation measures to be roughly proportional to the impacts caused by the project, the court refused to second-guess the agencies’ conclusions that the 1:1 ratio alternative was not feasible and that full mitigation can be accomplished by a habitat conservation plan that is founded upon both qualitative and quantitative principles, rather than merely an acre-for-acre ratio. The court suggested that the 0.5:1 ratio was generous, in light of the evidence that habitat throughout the basin is of uneven value and the "Department’s ability to coerce developers to mitigate is further circumscribed by the limited data on the scope of the actual take."

For more information please contact Stephanie Helfrich. Stephanie Helfrich is an associate in the Real Estate, Land Use and Environmental Practice Group in the firm’s San Francisco office.

[1]National Wildlife Federation v. Babbitt (E.D.Cal.2000) 128 F.Supp.2d 1274, 1277-1279 (Natomas I).

[2]National Wildlife Federation v. Norton (E.D.Cal. Sept. 7, 2005, No. CIV-S-04-0579 DFL JF) 2005 U.S .Dist.LEXIS 33768 (Natomas II).

Stephanie Helfrich is an associate in the Real Estate, Land Use and Environmental Practice Group in the firm’s San Francisco office.