FRIENDS OF THE COLLEGE OF SAN MATEO GARDENS v. SAN MATEO COUNTY COMMUNITY COLLEGE DISTRICTCalifornia Natural Resources Agency and Governor’s Office of Planning and Research’s Supplemental BriefCal.June 16, 2016SUPREME COURT COPY Jn the Supreme Court of the State of Caltfornta FRIENDS OF THE COLLEGE OF SAN MATEO GARDENS, Plaintiff and Respondent, Case No. 8214061 ° SUPREMECOUR’ SAN MATEO COUNTY COMMUNITY E i ( r ‘ COLLEGE DISTRICTetal., tres Sees ho Defendants and JUN 16 2046 Appellants. Frank A. MeGuire Sises ; First Appellate District, Div. 1, Case No. A135892 Deputy { CRC \ Sari Mateo County Superior Court, Case No. CIV508656 8.25(b) ' The Honorable Clifford Cretan, Judge ‘ SUPPLEMENTAL BRIEF OF THE CALIFORNIA NATURAL RESOURCES AGENCY AND THE GOVERNOR’S OFFICE OF PLANNING AND RESEARCH KAMALAD. HARRIS Attorney General of California ROBERT W. BYRNE Senior Assistant Attorney General TRACY L. WINSOR Supervising Deputy Attorney General *JEFFREY P. REUSCH Deputy Attorney General State Bar No. 210080 1300 I Street, Suite 125 P.O. Box 944255 Sacramento, CA 94244-2550 (916) 327-7851 Jeffrey.Reusch@doj.ca.gov Attorneysfor California Natural Resources Agency and Governor’s Office ofPlanning and Research TABLE OF CONTENTS Page INTRODUCTION AND ISSUES PRESENTED...cecceesseeeeseeeesesseeeees 1 STATUTORY AND REGULATORY BACKGROUND ........cccccssseeeeeees 2 I. CEQA’s Useof “Substantial Evidence” and “Fair * ALBUMEN” ooeeeenecenecesnecsseeascnecseesecesesaeeseseesessueeasenteeaeens 2 Il. Current Section 21166 and Guidelines Section 15162.......... 5 Ill. Adoption and Amendmentof Guidelines Section 15162 Lecce eceeceseeseeeeeseaeeeseesseeesesesassseesseceesseessasersesatesssnas 6 ANALYSISwccccceccesscecsssesessecseeeseeneeesseseaeesesessesaeceessaesssaeeseeseasasenseneeeass 9 I. Answering the Court’s First Question: The Substantial Evidence Standard of JudicialReview Applies to Agency Determinations Under Guidelines Section 15162 ieeeeeeteeeecnecesecesseecsecsececesesessesesseeeesseeeesssessteasenseses 9 A. Decades of California Appellate Jurisprudence Support Application of the Substantial Evidence Standard oo... eeeesccseessecsevsessecssesseeseeeesseneeeseessessesess 10 B. The Legislature Has Acquiesced in the Longstanding California Appellate Jurisprudence and Guidelines... cceeseesseeeeseeees 13 C, The Legislative Purposes Behind CEQA,and Harmonizing the Relevant Statutes and Guidelines, Support the Substantial Evidence Standard oo. ccsescscreessessetsseesseeesesssesseesseeeeeeseeess 14 IJ. Answering the Court’s Second Question: Guidelines Section 15162 Is a Valid Interpretation of Public Resources Code Section 21166, and a Proper Exercise of the Natural Resources Agency’s Rulemaking AUthOTILY o0. ee ee eeeecseeeeceeeeneeesesecessesesscesceeseceseesseeecssessssetssenes 18 A. The Guidelines, Reflecting the Natural Resources Agency’s Interpretation of CEQA, Are Given Great Weight, and Guidelines Section 15162 Should Be Upheld as Reasonable ANd Validao.eeecsseneccesseeseesessssseseseessseeseesnvsesens 19 TABLE OF CONTENTS (continued) Page B. Previous Judicial Analyses Correctly Validated Guidelines Section 15162 ..........ccscccsssccessssseessesecees 20 C. Construing Section 21166 and Guidelines Section 15162 Within the Context of Related CEQAStatutes Further Demonstrates the Validity of Guidelines Section 15162 oe. 22 D. The Legislature’s Longstanding Awareness of Guidelines Section 15162 Supports the Guideline’s Validity........cccccssssecssessseersssessesessrenss 23 Ill. The Substantial Evidence Standard of Judicial Review also Applies to an Agency’s Determination That an Activity Is a Modification to a Previously Approved Project, and That the Limitations in Section 21166 APPLY woeceeccccsscsscseeceneceerseeseceteeeseseneesesaesseseuesseeeassesscsensenaes 24 IV. Guidelines Section 15162, and Applying the Substantial Evidence Standard to It, Affords Adequate Safeguards against Abuse ofDiscretion ............cccceeseeee 26 CONCLUSION...ceeccsceecssseessesseesssesecsessesssecssseseesscsssecsssseesessvasesseeseres 30 ii TABLE OF AUTHORITIES Page CASES Abatti v. Imperial Irrigation Dist. (2012) 205 CalApp.4th 650.0... cccccssesesessserssees seseeseeevaeeseeseeerens passim American Canyon Community Unitedfor Responsible Growth v. City ofAmerican Canyon (2006) 145 CalApp.4th 1062.0... cccccscssessceseescessessseesseceesenneases 28, 29 Ballona Wetlands Land Trust v. City ofLos Angeles (2011) 201 CalApp.4th 455 occcccccccssscsssssccscssecesecessessecsescsscsuesseeneeeas 3 Benton v. Board ofSupervisors (1991) 226 Cal.App.3d 1467 occeecccesseeesetsessssseceseesesetecesenes passim Berkeley Hillside Preservation v. City ofBerkeley . (2015) 60 Cal.4th 1086...csceecssesteeeetecessseesessssssessatssssessesees 4,9 Bowman vy. City ofPetaluma (1986) 185 Cal.App.3d 1065... ccccsssesssseeesesseesecssesseeseesrsesssenes passim Cal. Bldg. Industry Assn. v. Bay Area Air Quality Management Dist. (2015) 62 Cal4th 369oiceccssesscsssecsessssceseesesseserseesssesseenss 6, 7, 19, 20 Concerned Citizens ofCosta Mesa, Inc. v. 32nd Dist. Agricultural Assn. (1986) 42 Cal.3d 929icccsesessnscsscseesesscssecsecsseecseeseessercnssases 29, 30 Friends of “B” Street v. City ofHayward (1980) 106 Cal.App.3d 988 ooeccsccsstsssssscessessccsssesseescesstsseusesensevens 3 Friends ofMammoth v. Board ofSupervisors (1972) 8 Cal.3d 247 oo cececsecssecsseesssessesesscsseessesscsseessecssscatssssecessasenseens2 Laurel Heights Improvement Assn. v. Regents of Univ. of California (1988) 47 Cal.3d 376. cicccceccceseseeeeseccssescsscseessssassereessrecnees 3, 14, 27, 28 iil TABLE OF AUTHORITIES (continued) Page Laurel Heights Improvement Assn. v. Regents of Univ. of California (1993) 6 Cal4th L112.ccccccsssesscsscesecessscssessessessssesssessssseres passim Moorev. Cal. State Bd. ofAccountancy (1992) 2 Cal.4th 999oocceescsessessescsssesssecessssescsessassesscsssssseseesseraees23 Moore v. Panish (1982) 32 Cal.3d 535 oeceescsesscsccssccsessesessssessecssssesscesessevsssesees 10, 14, 22 People v. Overstreet (1986) 42 Cal.3d 891 oeccetsccsscsssseeesssscssccsessvscsstssvsseesescereceres 13, 23 Save Our Neighborhood v. Lishman . (2006) 140 Cal.App.4th 1288cccccccsesssesssessscssssessecssseesessseesees 25, 26 Sequoyah Hills Homeowners Assn. v. City ofOakland (1993) 23 Cal.App.4th 704occecccssssscsssesscesesscsesscsccsscssssessesssesecerseases25 Sierra Club v. County ofSonoma (1992) 6 Cal.App.4th 1307... ccccccccsccscsssscsecsssssessesssssecsesecsecscsesacsnes 4,5 Snarled Traffic Obstructs Progress (STOP) v. City and County ofSan Francisco (1999) 74 Cal.App.4th 793 oo... cccccccsscscsssssssssssssesssseees 11, 12, 15, 27 Stone v. Board ofSupervisors (1988) 205 CalApp.3d 927 occcsssssescsessssecsscssssssssscsssssscsevevetecacssscsenes 26 iv TABLE OF AUTHORITIES (continued) Page STATUTES California Code of Regulations, Title 14 § 15000 et SOG.rceeesecccsececsetesseesesseeaeeseeaeeneesueeseseseatenseaeeeneees passim § 15063 oo eecsccssscesscssscesecceeessseceessecsesesesesecssressesecseserscsssesressscessaseees 31 § 15064, Subd. (£7)... eeecccceccsscccessecsscsssesssseeessecesessenseecsssessssesesenas 8, 17 § S067 vo ecceceececssscssscccssstsceeeeecccssseeesessceseeesesssstssusessecesetesersaseeaseeens 7,8 § 15071 vecccesscessceterssseeeeeennes desaceeesaceesseesseasaceeeeeeseesesseeessanesceceeeesaaas 31 § 15126.6 occcccccsscccssssseeecsccerssseccessecstsesseseesesesecsessssesusuecesseeseaaes 31 § 15162eessenesnecsecsseeeseeeseeaeeseseeseeessecseteeeeceaeeesesseereseseaeees passim § 15162, SUD. (8) ceececscccccssssccesseesseeessessesessesseeecersseeesessessaseceees 6, 17 § 15162, subd. (€)(1-3) oececccsecessccssecseeesseecessrseesceesssuevseecessueseeveneseess 6 § 15162, SUbAS. (D-C) oo. eeeccescessecessecseesseseecssecesssesessesesseecsssessesecensscsuees 6 § 15162, SUD. (C)eeecsecsssssesssecessesscessessecsescesseeeesessessaseaseusesersaeesenes29 § 15163 vecescessecssssecsessnecersceccesssesessscesscceserseeessasceceesevesssecesseeseanacs 9 § 15164cccccsccsssesssscccsesssssnseeseecsssscessecseserecesesesectssseveasecensncaaeas 9,17 § 15164, SUD. (€) oo. ecesceececcccessssesesssesssseesessereeeseseceensesenes 17, 28, 30 § 15300.2, SUB. (C) oo. eeceeeeecccesessssccsssecsssecevesseressesavevesssecestceeeceveesaaecs4 § S384 oeccesccssesssscssscsessececcesssseersssesssessssesssccesesssssscessssssscessaaseceetsess 17 § 15384, Sub. (8)... cceceecccccsssssevsssesssccsersssecesersceseesesesesasentatess 10, 18 Codeof Civil Procedure § 1094.5, SUDA. (DB)... ee ecececccesssccestscescsssevssseceessceeesevstesssssceaseescetteseess 2 Government Code § 11340 et SOQ. eeeecessneccesseecsseecssessessessecssseeeseseessensessesssessnesecssnscenes6 § 11350eeecccsssesssseessssseesecescensesesssuessseceessecssseesassscusssesevsaneeseseees 31 § 65920 Ct SCG... eeeecescestecssneceseesseseseeseessesseeeseeeeseesssessssseatessesseseaeeees 15 § 65921 vececcsccsstessssccesssssssesscevesessssessessaeesLeceeeeececensateessececeesnsneaseees 15 TABLE OF AUTHORITIES (continued) Page Public Resources Code § 210038eceeeseeeessecseeeseessecseceeecsesscssscesecssusessassasseessssereeeseeenes 17, 22 § 21003, SUDA. (feeeeececsseesscesestecsessasessesseeeseseessseseesssesesteaseeseseesnes 16 § 21003 1 eeeecesneccseeesscseecsssceessseesesseseecesseeseseessessesseessees 17, 21, 22 § 21003.1, SUDA. (A)... eiseeccesecsseessssesesceeseessccsesceesssseessesssseesescaueenens 16 § 21080.eeereese cseseesscscssssessssssesstscscsessessessesseesessesssetesseseees DASSIM § 21080.1, SUC. (8) oe eee ceccsscesseesscsseseesseseeseesecesseseceseseesesscrsrensuseesens 15 § 21083eeescseseeseecsseeceseessecseecsserseseesssesesesssesesasestessessesatesseenes passim § 21083, SUDA. (a) oeeee eecesesteessesresscesesesssesesesecscecssesssseesaseseesereesuenesevaas 6 § 21083, SUB. (A)...ee ecsceesstecssesseesessesseensaes vesseseessseesessesceveseavesesaes 6 § 21083.01 oeeescctecceetseeseesseessssssessessesssecseesseesessessessesseesesees 13, 23 § 210831eeeeeseceneeeseessecesecssecsesseseeseseessseesseeseessseeessesestscerenssers 17 § 21083.09 ooeessccseecstessessssessscssersessssseecsssecesssssesssenseseeereeenes 13, 23 § 21094 ooeecceeecessersaeeeesteetsesecsssssessssensessessssesseseessecsesescssersucensseeserss4 § 21108eeeeereessseeneceseceseessessesseseessseseseesesssssesseesetereseessssssensees 30 SSLeeeeeseceeseeesseecsscesecsssessesssessessesssesaeeeatsssesstesseeescsaaves passim § 21Seeeeeeeseeeseeesctseeseetseeseeesseesesseseeecesscnseesesesssesracseeesserens 30 § 21166eeeseeeseeneessessesseessesseceesesseeseseseecsecessesssssesteetssesnuss passim § 21166, SUDA. (8)eeeecccssecssecssceseenesstessscesssccsscssnssssssusasessseeseeseeQd § 21166, SUBS. (€)-(C)...ecccsceccsescesssscscscscsscsessessccsssvscsesscsevevaesersessecseerees 5 8 21167eceeeetetsceeesatetseessessecsesesseessseseseseeeeseesseceescsesesseseases 15, 16 § 21167, subds. (b)-(€)......ccsccesssesssesssssecssssesseeceeseecssscessscsssveseseteseesars30 § 211672eeseeescseeesecssecseessecsessesseessescssssssessecaesescssesseusetsssssessesees 12 § 21168oeeeeeesseesseesesseesseseesesseesessesssesesesecsesecseecenseuesersrees 2,9 § 211685 oocceteessecseeecseceeseseereesseseseseseesesersnssessseseeusessrecanens 2,9 vi INTRODUCTION AND ISSUES PRESENTED This Court posed the following questions to the California Natural Resources Agency (Resources) and the Governor’s Office of Planning and Research (OPR)(collectively, Natural Resources Agency): (1) Under California Environmental Quality Act (CEQA) Guidelines section 15162, what standard ofjudicial review applies to an agency’s determination that no environmental impact report (EIR) is required as a result ofproposed modifications to a project that was initially approved by negative declaration or mitigated negative declaration? (See generally Benton v. Board ofSupervisors (1991) 226 Cal.App.3d 1467, 1479-1482.) (2) Does CEQA Guidelines section 15162, as applied to projects initially approved by negative declaration or mitigated negative declaration rather than EIR, constitute a valid interpretation of the governing statute? (Compare Bowmanv. City ofPetaluma (1986) 185 Cal.App.3d 1065, 1073-1074 with Benton at pp. 1479-1480.) Answering the Court’s first question, the substantial evidence standard applies to judicial review of an agency’s determination, under Guidelines section 15162,' that no EIR or subsequent EIR is required, regardless of whether the project wasinitially approved by EIR, negative declaration, or mitigated negative declaration. Answering the Court’s second question, Guidelines section 15162 is a longstanding and correct interpretation of the governing statute, Public Resources Codesection 21166,” andrelated provisions of CEQA. ' The CEQA Guidelinesare found in the California Code of Regulations, title 14, § 15000 et seq. This brief will refer to them as “Guidelines sections”(e.g., Guidelines section 15162). ? Unless otherwisestated, statutory referencesare to the California Public Resources Code (e.g., Section 21166). Applying the substantial evidence standard is consistent with the language of Section 21166, the legislative purposes of CEQA, and decades of California jurisprudence. Guidelines section 15162 implements and carries out the intent of Section 21166 by incorporating limitations on subsequent environmental review of a project, not only whentheinitial environmental documentrelevant to that project is an EIR, but also when that documentis a negative declaration or mitigated negative declaration. Both the substantial evidence standard and Guidelines section 15162 serve CEQA’s policies offinality, certainty, efficiency, and early environmental review, while still maintaining and supporting CEQA’s fundamental goalof “afford[ing] the fullest possible protection to the environment within the reasonable scopeofthe statutory language.” (Friends ofMammothv. BoardofSupervisors (1972) 8 Cal.3d 247, 259.) This Court should uphold the tested and provenvalidity of Guidelines section 15162, and the judicially endorsed application of the substantial evidence standard of review to that Guideline. STATUTORY AND REGULATORY BACKGROUND I. CEQA’S USE OF “SUBSTANTIAL EVIDENCE”AND “FAIR ARGUMENT” In reviewing a lead agency’s compliance with CEQA,courts will apply one oftwo standards of review. These two standards derive from the two different prongs of Sections 21168 and 21168.5, which provide thata court may only overturn an agency’s decision if: (1) the agency has not proceeded in the manner required by law, or(2) the agency’s determination is not supported by substantial evidence in the record. (See also Code Civ. Proc., § 1094.5, subd. (b) [required to be applied pursuant to Section 21168, and providingthat “abuse of discretion is established if the respondenthas not proceeded in the mannerrequired by law... .”].) The formeris a question of law on which courts owe agencies no deference. (Ballona Wetlands Land Trust v. City ofLos Angeles (2011) 201 Cal.App.4th 455, 468.) In reviewing an agency’s factual findings and conclusions underthe latter standard, however,“‘the reviewing court must resolve reasonable doubts in favor of the administrative finding and decision.’” (Laurel Heights Improvement Assn. v. Regents of Univ. ofCalifornia (1988) 47 Cal.3d 376, 393 [hereafter Laurel Heights I], quoting Topanga Assn. for a Scenic Community v. County ofLos Angeles (1974) 11 Cal.3d 506, 514.) Courts apply the first standard, asking whether the agency has proceeded in the mannerrequired by law, when reviewing an agency’s initial determination under Section 21151 as to whether an EIR must be prepared. (Friends of “B” Street v. City ofHayward (1980) 106 Cal.App.3d 988, 1002.) Section 21151 “commands that an EIR must be prepared whenevera project ‘may havea significant effect on the 399 environment.’” (Laurel Heights Improvement Assn. v. Regents of Univ. of California (1993) 6 Cal.4th 1112, 1134-1135 [hereafter Laurel Heights IT].) Because Section 21151 requires preparation of an EIR whenevera project “may”have a significant effect, a lead agency may not weigh the evidence when making the preliminary determination as to whether an EIR is required. Instead, the lead agency, and any reviewing court, ask only whether any substantial evidence in the record supports a “fair argument” that the project may havesignificant effects, thus requiring an EIR. (Laurel Heights IT, supra, 6 Cal.4th at pp. 1134-1135.) Because the existence of evidencein the record supporting a fair argument - regardless of contrary evidence - presents a legal question, courts do not defer to an agency’s determination as to whether such evidence exists. Becausethat “fair argument” standard ofjudicial review derives solely from Section 21151, it has been applied only to theinitial determination of a project’s environmental effects, which in turn governs whether an environmental documentis required and, if one is required, whetherto prepare an EIR or a negative declaration. (Laurel Heights II, supra, at p. 1135; see also Berkeley Hillside Preservation v. City of Berkeley (2015) 60 Cal.4th 1086, 1115-11 16.)° This Court has declined to extend the “fair argument” standard beyondthe context of that initial environmental review. (Laurel Heights IT, supra, at p. 1135.) In all other contexts, the substantial evidence standard ofjudicial review applies and resolves doubts in favor of the agency’s decision. (/d. at pp. 1134-1135; Bowman, supra, 185 Cal.App.3d at p. 1073.) Judicial review of agency determinations under Section 21166 is one context in which courts apply the substantial evidence standard and resolve doubtsin favor of the agency’s decision. (Bowman, supra, 185 Cal.App.3d at pp. 1073-1075.) As discussed below, Section 21166 differs from Section 21151 in that, instead of requiring an EIR in certain circumstances, Section 21166 prohibits preparation of a subsequent EIR unless the lead agency > In Berkeley Hillside Preservationv. City ofBerkeley (2015) 60 Cal.4th 1086, 1115-1116, this Court applied the “fair argument” standard of Judicial review to a determination, under Guidelines section 15300.2, subdivision (c), that a project is categorically exempt from CEQAandthat there is no “reasonable possibility that the activity will have a significant effect on the environment due to unusual circumstances.” That determination, like a determination that no EIRis required under Section 21151, is part of a project’s initial environmental review. This Court reasoned,in part, that “reasonable possibility” closely resembles the language in Section 21151 that an EIR must be prepared whenevera project “may” have a significant environmental effect. This Court applied the substantial evidence standard, however, to the threshold question of whether unusual circumstances existed. (Berkeley Hillside Preservation, supra, atp. 1115.) The “fair argument” standard has also been applied to the determination of whether additional environmental review is required underthe “tiering” provisions of Section 21094, but, again, only because that section uses the phrase “may causesignificant effects on the environment.” (Sierra Club v. County ofSonoma (1992) 6 Cal.App.4th 1307, 1319.) makescertain factual determinations about project modifications. The lead agency does not evaluate whether any substantial evidence in the record supports a fair argumentthat a condition exists requiring a subsequent EIR, but instead makes a judgmentcall that must be supported by substantial evidencein the record. Reviewing courts, in turn, ask only whether the agency’s judgmentcall was so supported." II. CURRENT SECTION 21166 AND GUIDELINES SECTION 15162 Section 21166, as amended in 1977, providesthat, “[w]hen an environmental impact report has been prepared for a project pursuantto this division, no subsequent or supplemental environmental impact report shall be required by the lead agency or by any responsible agency,” unless one of three events occurs. Those events include “substantial changes”to the project or its circumstances that “will require major revisions of the [EIR],” and the availability of “new information.” (Pub. Resources Code, § 21166, subds.(a)-(c).) Section 21166 does not providecriteria for identifying “substantial changes,” or for determining what quality of “new information” requires preparation of a subsequent EIR. * Similarly, the determination that an activity is a modification to a previously approvedproject, or is instead a new project, is a factual determination that should be upheld if supported by substantial evidence in the record. The decision in Sierra Club v. County ofSonoma, supra, 6 Cal.App.4th at pp. 1320-1321, illustrates this principle. In that case, the county prepared an EIR on plan that set aside an area as an agricultural preserve. The county later amendedthe plan to allow miningin that preservedarea, but failed to conduct additional environmental review. The county argued that Section 21166 applied, prohibiting a subsequent EIR, because the amendmentto allow mining wasnot a separate project, but rather a minor modification of the existing project. The court disagreed, finding that “the evidence does not support [the county’s] determination that [the amendmentto allow mining] was either the sameasor within the scope ofthe project, program, or plan described in the program EIR.” (bid.) Guidelines section 15162, implementing Section 21166, fills in those gaps, and properly provides guidanceregardless of whethertheinitial environmental documentis an EIR or a negative declaration. Guidelines section 15162, subdivision (a), states that, “[w]hen an EIR has been - certified or a negative declaration adopted for a project, no subsequent EIR shall be prepared for that project unless the lead agency determines, on the basis of substantial evidence in the light of the whole record,” that one or more conditions has occurred. Consistent with Section 21166, those conditions include “substantial changes” in the project or its circumstances, or “new informationof substantial importance.” (Cal. Code Regs., tit. 14, § 15162, subd. (a)(1-3).) Guidelines section 15162 also provides guidance as to what an agency should do if it determines that a subsequent EIRis not necessary, and whatis required of responsible agencies faced with substantial project changes or new information after the lead agency’s role in project approval is complete. (Cal. Code Regs., tit. 14, § 15162, subds. (b-c).) HI. ADOPTION AND AMENDMENTOF GUIDELINES SECTION 15162 Section 21083 delegates to OPR the responsibility to “prepare and develop proposed guidelines for the implementation of [CEQA]by public agencies.” (Pub. Resources Code, § 21083, subd. (a).) OPR transmits proposed guidelines to the Secretary of the Resources Agency (now the Natural Resources Agency), whocertifies and adopts the proposed guidelines in compliance with the Administrative Procedure Act(APA) (Gov. Code, § 11340et seq.). (Pub. Resources Code, § 21083, subd.(d).) “The APA subjects potential agencyinterpretations [of governingstatutes] to procedural safeguards that foster accuracy and reliability,” and “[t]he Guidelines are a product ofthis process, promulgated in accordance with these important safeguards.” (Cal. Bldg. Industry Assn. v. Bay Area Air Quality ManagementDist. (2015) 62 Cal.4th 369, 390 (“CBIA”).) In delegating to the Natural Resources Agency the responsibility to ‘promulgate the Guidelines, Section 21083 “recognizes the primacy ofthe [Natural Resources Agency]”to “certify and adopt the Guidelines that bind public agencies as they navigate the often technical and complex waters of CEQA.” (CBIA, supra, 62 Cal.4th at p. 390.) The Guideline that eventually became section 15162 wasoriginally adopted in 1973, as Guidelines section 15067. (Natural Resources Agency’s Request for Judicial Notice (RJN), Exh. 3.) It implemented Section 21166, enacted in 1972. (RJN, Exh.2.) Section 21083 originally authorized the Guidelines to “include objectives and criteria for .. . the preparation of environmental impact reports... .” (RJN, Exh. 1.) The 1973 version of Section 21083 did not discuss negative declarations. Asa result, the original version of Guidelines section 15067 established two conditions for the preparation of an “additional EIR”after an EIR had been *° but did not reference substantial project changes following“prepared, adoption of a negative declaration, because Section 21083 did not authorize the Guidelines to provide criteria for negative declarations until 1976 . (RIN,Exh.3.) | The Legislature amended Section 21083 in 1976, authorizing the Guidelines to “include objectives and criteria for . . . the preparation of environmental impact reports and negative declarations... .” (RJN, Exh. 4.) In 1977, the Legislature amended Section 21166 to add third condition triggering the requirement of a subsequent or supplemental EIR. (RJN, Exh. 5.) Also in 1977, the Legislature enacted Section 21080.1, > Guidelines section 15162 now applies after an EIR has been “certified,” or a negative declaration has been “adopted.” affording negative declarations the same degreeoffinality as EIRs. (RJN, Exh.6.) The Natural Resources Agency amended Guidelines section 15067 in 1978 to implementthe Legislature’s inclusion of negative declarationsinto Section 21083 and to include the third condition added to Section 21166 in 1977. As amended, Guidelines section 15067 provided three conditions under which an “additional EIR” (now “subsequent EIR”) would need to be prepared following the preparation of an EIR or a negative declaration. (RJN, Exh. 7.) Substantially that same regulatory interpretation of Sections 21083 and 21166, first embodied in Guidelines section 15162 andits predecessor, Guidelines section 15067, has remainedin place for the last 38 years. (RJN, Exh.8.) In 1994, the Natural Resources Agency further amended Guidelines section 15162 without changingits application to negative declarations. In that amendment, the Natural Resources Agency added language indicating that a lead agency’s determination that a subsequent EIR is required must be based on “substantial evidence in the light of the whole record.” (RIN, Exh. 10.) The rulemaking history of that amendmentindicates that the Natural Resources Agency intended, by that language, to confirm that courts should apply the substantial evidence standard when reviewing agency determinations as to whether a subsequent EIR mustbe prepared. In its Final Statement of Reasons for the amendment, the Natural Resources Agency cited Bowmanv. City ofPetaluma, supra, 185 Cal.App.3dat pp. 1070-1074, and Benton v. Board ofSupervisors, supra, 226 Cal.App.3dat pp. 1479-1480, noting that the amendment“reflects recent case law” and “applies the substantial evidence standard of review to the decision whether to prepare a subsequent EIR.” (RJN, Exh. 12 at pp. 13-14.) Theofficial note to Guidelines section 15162 likewise cites Bowman and Benton, and, in Guidelines section 15064, subdivision (f)(7), the Natural Resources Agencyfurtherclarified that, “{u]nder case law,the fair argument standard does not apply to determinationsofsignificance [of environmental effects] pursuantto sections 15162, 15163, and 15164.” ANALYSIS I. ANSWERING THE COURT’S FIRST QUESTION: THE SUBSTANTIAL EVIDENCE STANDARD OF JUDICIAL REVIEW APPLIES TO AGENCY DETERMINATIONS UNDER GUIDELINES SECTION 15162 The substantial evidence standard ofjudicial review - specifically, the substantial evidence prong of the “abuse of discretion” standard required by Sections 21168 and 21168.5 - is the appropriate standard for a court’s review of agency determinations that no subsequent EIR is required under Guidelines section 15162. The substantial evidence standard applies regardless of whetherthe original environmental document was an EIR or a negative declaration. The “fair argument”test, which derives from Section 21151 and applies only to the initial evaluation of a project’s environmental effects,’ does not govern judicial review of an agency’s decision about whether additional environmental review is required under Section 21166 or Guidelines section 15162. These conclusionsreflect decades of consistent and unambiguous California jurisprudence addressing review of an agency’s determination concerning additional CEQA documentation. Moreover, the courts have reached the correct decision. Application of the substantial evidence standard to determinations under Guidelines section 15162 is supported by the legislative purposes underlying CEQA and by harmonizing Guidelines 6 Berkeley Hillside Preservation v. City ofBerkeley, supra, 60 Cal.4th at pp. 1115-1116; Laurel Heights II, supra, 6 Cal.4th at p. 1135. section 15162 with “the whole system of law of whichit is a part.” (Moore v. Panish (1982) 32 Cal.3d 535, 541.) A. Decades of California Appellate Jurisprudence Support Application of the Substantial Evidence Standard Thirty years ago, the Court of Appeal, First Appellate District held that decisions under Section 21166 (whether to prepare a subsequent EIR) are judicially reviewed by asking “whether the record as a whole contains substantial evidence to support” the agency’s determination. (Bowmanv. City ofPetaluma, supra, 185 Cal.App.3d at p. 1075.) Ifthe record does contain such evidence, the agency’s determination muststand. (/d. at p. 1072; Cal. Code Regs., tit. 14, § 15384, subd. (a).) The court stated that the “fair argument”test, “drawn from section 21151,” answers the question of whetherthe initial environmental review may proceed by negative declaration or, instead, requires an EIR. (Bowman, supra,at p. 1073.) Conversely, the court reasoned, “Section 21166 is intended to provide a balance against the burdens created by the environmental review process and to accord a reasonable measureoffinality and certainty to the results achieved.” (/d. at p. 1074.) Dueto these different statutory purposes, and the lack of any authority equating Sections 21151 and 21166,the court applied the substantial evidence standard, not the “fair argument” standard, to the agency’s determination that no subsequent EIR was required. In Bowman,the original environmental document wasan EIR. (Bowman, supra, 185 Cal.App.3d at p. 1070.) In 1991, the First Appellate District held that the substantial evidence standard ofjudicial review also applies to decisions under Guidelines section 15162 whentheoriginal environmental documentis a negative declaration. (Benton v. Board of Supervisors (1991) 226 Cal.App.3d 1467, 1481-1482.) The Benton court reasonedthat: 10 The application of [Guidelines section] 15162 when a project proponentseeks to modify a project that originally received a negative declaration parallels the application of section 21166 and [Guidelines section] 15162 when a project proponent seeks to modify a project on which an EIR has already beencertified. Therefore, the same standard ofreview should apply in both situations. (Id. at p. 1482.) In the context of evaluating the validity of Guidelines section 15162, rather than the standard ofjudicial review, the Benton court also noted: If a limited review of a modified project is proper when the initial environmental document was an EIR,it stands to reason that no greater review should be required of a project that initially raised so few environmental questions that an EIR was not required, but a negative declaration was foundto satisfy the environmental review requirements of CEQA. Tointerpret CEQAasrequiring a greater level of review for a modification of a project on which a negative declaration has been adopted and a lesser degree of review of a modified project on which an EIR wasinitially required would be absurd. (Benton, supra, 226 Cal.App.3d at p. 1480.) The court’s reasoning applies equally well to the standard ofjudicial review under Guidelines section 15162. No greater standard of review - for example, the “fair argument” standard - should be required of a project for which a negative declaration initially satisfied CEQAthan is required of a project for which an EIR was prepared. Thisis discussed in greater detail below,at Section I.C., pp. 14- 18. | In Snarled Traffic Obstructs Progress (STOP) v. City and County of San Francisco (1999) 74 Cal.App.4th 793, the First Appellate District reaffirmed Bowman and Benton. The court was, again, faced with the argumentthat project modifications, following a negative declaration, required a subsequent EIR under Guidelines section 15162. (STOP, supra 3 74 Cal.App.4th at pp. 795-796.) Supporting its application of the 11 substantial evidence standard ofjudicial review, the court wrote that, “[i]n an obvious sense, an EIR anda negative declaration are the twosides of the same coin, the either/or options available to a public agency considering a project.” Cd. at p. 797.) The court also invoked CEQA’s “concerns for finality and presumptive correctness” protecting both EIRs and negative declarations. (/bid., citing Section 21167.2 and Laurel Heights II, supra, 6 Cal.4th at p. 1130.) The STOP court addressed Bowman and Benton bynoting that, regardless of whethertheinitial environmental document was an EIRor a negative declaration, “the project had already received‘full,’ ‘in-depth,’ and ‘final CEQA review’” by the agency. (STOP, supra, 74 Cal.App.4th at p. 799; see also STOPat p. 800 [citing Bowman whilestating: “Benton gives us authority to treat the... agency actions as merely the approval of a modified version of the project, a project that had already undergonein- depth environmental review.”].) The court held that the “fair argument” standard ofjudicial review did not apply, because “the time for challenging the .. . adoption of the negative declaration has long since passed.” (Id. at p. 800.) Instead,the court reviewed whether substantial evidence supported the municipal agency’s “determination that the proposed modifications for the project did not require either changesin the 1988 negative declaration or preparation of an EIR,”resolving all reasonable doubts in favor ofthat determination. (/d. at p. 798.) Morerecently, in Abatti v. ImperialIrrigation Dist. (2012) 205 Cal.App.4th 650, the Court of Appeal, Fourth Appellate District, Division Oneapplied the substantial evidence standard when reviewing a determination, made under Guidelines section 15162, that no subsequent EIR was required following a final negative declaration. (Id. at pp. 653, 675, 676-677, 682.) The Abatti court extensively analyzed and approved Benton’sfinding that Guidelines section 15162 is a valid implementation of 12 Section 21166. (Ud. at pp. 669-674.) The court apparently accepted as settled that, where the initial environmental documentis a negative declaration, the substantial evidence standard governsjudicial review of agency determinations under Guidelines section 15162. (/d. at pp. 675, 676-677, 682.) B. The Legislature Has Acquiesced in the Longstanding California Appellate Jurisprudence and Guidelines In the 38 years since the predecessor to Guidelines section 15162 incorporated negative declarations, no published decision has held that any standard, other than the substantial evidence standard, governsjudicial review of agency decisions not to require a subsequent EIR. “The Legislature is deemed to be aware of existing laws and judicial decisions in effect at the time legislation is enacted and to have enacted and amended statutes ‘in the light of such decisions as have a direct bearing upon them.’” (People v. Overstreet (1986) 42 Cal.3d 891, 897, quoting Estate ofMcDill (1975) 14 Cal.3d 831, 839.) Although Section 21166 has not been amended since 1977, the Legislature has amended many other CEQA statutes in the 25 years since Benton. Most notably, since Benton, the Legislature amended Section 21083 in 2002 and 2004,and Section 21080.1 in 1993 and 1994. (RJN, Exh. 9.)’ At any time in those 25 years post-Benton, the Legislature could have disapproved Benton and its progeny by expressly providing a different standard of review when enacting multiple amendments to CEQA. For example, in Sections 21083.01 and 21083.09, the Legislature exercisedits ability to require changes to the Guidelines where it deems such changes ” As noted aboveat pp. 6-7, Section 21080.1 provides forthe finality of both EIRsand negative declarations, and Section 21083 authorizes the Guidelines. 13 necessary. That the Legislature did not mandate changesto the standard of judicial review applied by Benton showsthat the substantial evidence standard in Guidelines section 15162 is reflective of, and carries out, the Legislature’s intent. This Court should not upset what the Legislature has chosen to leave alone, overturning 25 years ofjudicial and regulatory certainty by holding that, under Guidelines section 15162,the judicial standard of review differs depending on whethertheinitial environmental document was an EIR or a negative declaration. C. The Legislative Purposes Behind CEQA,and Harmonizing the Relevant Statutes and Guidelines, Support the Substantial Evidence Standard The “fundamental rule” of construing legislation “is that the court should ascertain the legislative intent so as to effectuate the purpose of the law.” (Moorev. Panish, supra, 32 Cal.3d at p. 541.) “To this end, every statute should be construed with reference to the whole system of law of whichit is a part, so that all may be harmonized and haveeffect.” (Ibid.) Evaluating Section 21166 and Guidelines section 15162 within the overall context of CEQAsupports the longstanding judicial precedent applying the substantial evidence standard, not the “fair argument” standard, when reviewing agency determinations made pursuantto those sections. It is well-settled that “[t]he foremost principle under CEQAisthat the Legislature intended theact ‘to be interpreted in such a mannerasto afford the fullest possible protection to the environment within the reasonable scope ofthe statutory language.’” (Laurel Heights I, supra, 47 Cal.3d atp. 390, quoting Friends ofMammoth v. Board ofSupervisors, supra, 8 Cal.3d at p. 259.) But, after a final environmental documenthas beencertified or adopted, the question shifts from the nature of theinitial review under Section 21151 to whether further review should be required under Section 21166;at that point, this Court has foundthat“the interests offinality are 14 c a s R R R 6 favored overthe policy of encouraging public comment.” (Laurel Heights Il, supra, 6 Cal.4th at p. 1130; see also STOP, supra, 74 Cal.App.4th atp. 797.) That interpretation simply follows the statutory language andapplies whetherthe final environmental document wasan EIR or a negative declaration. Section 21080.1, subdivision (a), provides that an agency’s determination whether to require an EIR or a negative declaration “shall be final and conclusiveonall persons, including responsible agencies,” unless an action challenging the environmental documentis timely filed under Section 21167. Thus, Section 21080.1 accords negative declarations the same degree offinality as EIRs. This makes sense because,as the First Appellate District noted, negative declarations and EIRsare “twosides of the same coin,” both resulting from the sameinitial project review by the lead agency required by Section 21151 andits “fair argument”test. (STOP, supra, 74 Cal.App.4th atp. 797.) CEQA’spresumption offinality is groundedin the fact thatall projects mustnecessarily receive this same thresholdanalysis;it is not based onthe length, nor the volume,ofa particular environmental review document. Rather, that presumption attaches because the public, as well as responsible andtrustee agencies, have had the opportunity to review the evidence before the lead agencyand to offer additional or contrary ® Section 21080.1, and the final amendmentto Section 21166, were enacted in 1977 as part of the samebill that enacted the Permit Streamlining Act, Government Codesection 65920 et seq. (RJN, Exh. 11.) One “statewide need” expressed in the Permit Streamlining Acctis to expedite decisions on approval of developmentprojects. (Gov. Code, § 65921.) That this statewide need wasidentified in the samebill that amended Section 21166 and enacted Section 21080.1 further supports the conclusion that courts should not interpret Section 21166 in a waythat makes the project approval process more cumbersome. 15 evidence. The lead agency’s conclusions flowing from that evidence, moreover, could have been tested in court. These opportunities for review and challenge exist for both EIRs and negative declarations. Once the agency’s analysis is complete, and it has madeits determination about what type of documentis required, Section 21080.1 renders that determination final unless timely challenged under Section 21167, regardless of whether the resulting environmental documentis an EIR, a negative declaration, or a mitigated negative declaration. Affording finality to negative declarations that have not been timely ' challenged as required by Section 21167 also serves the Legislature’s stated goal of efficiency in the environmental review process. Project financingis often tied to the finality of project approvals, and delays can result in significant costs and can interfere with project objectives. Recognizing these practicalities, Section 21003, subdivision (f), declares the State’s policythat: All persons and public agencies involved in the environmental review process be responsible for carrying out the processin the most efficient, expeditious mannerin order to conserve the available financial, governmental, physical, and social resources with the objective that those resources may be better applied toward the mitigation of actual significant effects on the environment. Similarly, in Section 21003.1, subdivision (a), the Legislature declared the State’s policy that: Comments from the public and public agencies on the environmental effects of a project shall be made to lead agencies as soon as possible in the review of environmental documents, including, but notlimited to, draft environmental impact reports and negative declarations, in order to allow the lead agencies to identify, at the earliest possible time in the environmental review process, potential significant effects of a project, alternatives, and mitigation measures which would substantially reduce the effects. 16 Allowing “final” negative declarations to be reopened, and subsequent EIRsrequired, basedsolely on a “fair argument” that project modifications may have new significant environmental effects, would not only extend the “fair argument” standard beyond Section 21151, but would also defeat the policies of finality and efficiency embodied in Sections 21080.1, 21003, and 21003.1. Thosepolicies of finality and efficiency are reflected in the language of Guidelines sections 15162 and 15164. Guidelines section 15162, subdivision (a), provides that “no subsequent EIR shall be prepared for[a] project unless the lead agency determines, on the basis of substantial evidencein the light of the whole record,” that one or moreofthe enumerated circumstancesexists. Guidelines section 15164, subdivision (e), provides: A brief explanation of the decision not to prepare a subsequent EIR pursuant to Section 15162 should be included in an addendum to an EIR,the lead agency’s required findings on the project, or elsewhere in the record. The explanation must be supported by substantial evidence. Both sections require that the agency’s determination be supported by substantial evidence; they do not ask whether the record includes substantial evidence supporting the possibility that one of section 15162’s conditions exists. !° Therefore, Guidelines section 15384, defining 9 Additionally, Section 21083.1 states the Legislature’s intent that courts not interpret CEQA or the Guidelines “in a manner which imposes proceduralor substantive requirements beyond those explicitly stated” therein. Extending the “fair argument” standard ofjudicial review to Guidelines section 15162 would, contrary to Section 21083.1, impose a requirement beyondthose explicitly stated in CEQA and the Guidelines. ' Likewise, Guidelines section 15064, subdivision (f)(7) explicitly provides that “the fair argument standard does not apply to determinations of significance [of environmental effects] pursuant to [Guidelines] section{] (continued...) 17 “substantial evidence,” requires that an agency’s decision under section 15162 be upheld unless the record lacks “enough relevant information and reasonable inferences from this information that a fair argument can be made to support” the decision, “even though other conclusions might also be reached.” (Cal. Code Regs., tit. 14, § 15384, subd.(a).)'! | Both the overarching purpose of CEQAandthe applicable statutes, regulations, and case law establish that the substantial evidence standard applies to judicial review of an agency’s determination, under Guidelines section 15162, that no subsequent EIR is required as a result ofproposed modifications to a project that wasinitially approved by negative declaration or mitigated negative declaration. II. ANSWERING THE COURT’S SECOND QUESTION: GUIDELINES SECTION 15162 IS A VALID INTERPRETATION OF PUBLIC RESOURCES CODE SECTION 21166, AND A PROPER EXERCISE OF THE NATURAL RESOURCES AGENCY’S RULEMAKING AUTHORITY Guidelines section 15162, as applied to projects initially approved after a negative declaration or mitigated negative declaration rather than an EIR, constitutes a valid interpretation of Section 21166 and related sections of CEQA. (...continued) 15162,” but that such determinations “shall-be based on substantial evidencein the record of the lead agency.” '' As noted aboveat pp. 8-9, the rulemaking history of Guidelines section 15162 also confirms that the Natural Resources Agency intended courts to apply the substantial evidence standard. 18 A. The Guidelines, Reflecting the Natural Resources Agency’s Interpretation of CEQA, Are Given Great Weight, and Guidelines Section 15162 Should Be Upheld as Reasonable and Valid “A regulation will not be invalidated unlessit is arbitrary, capricious or patently unreasonable.” (Benton, supra, 226 Cal.App.3d at p. 1479.) Courts must also afford the Natural Resources Agency’s interpretation of CEQA,embodied in the Guidelines, “great weight .. . unless a provisionis clearly unauthorized or erroneous underthe statute.” (CBIA v. Bay Area | Air Quality ManagementDist., supra, 62 Cal.4th at p. 381.) This Court recently acknowledged the Natural Resources Agency’s “longstanding statutory role as the agency with primary responsibility for statewide implementation of CEQA,” observing that the Natural Resources Agency “is precisely the kind of agency that accumulates specialized knowledge of such an intricate statute and the trade-offs involved in its implementation.” (CBIA, supra, 62 Cal.4th at p. 390.) In according the Guidelines “great weight,” this Court also emphasizedthat “[t]he Guidelines are a product of [the APA] process, promulgated in accordance with [theAPA’s] important safeguards.” (/d. at pp. 381, 390) Mostregulations clarify or make more specific the termsofa statute. CEQAgoesfurther, expressly providing a broaderrole for the Guidelines. This Court explained, in CBIA: Reflecting the need for further elaboration of [CEQA’s] requirements in implementation, CEQA entrusts to [OPR] the responsibility of drafting the [CEQA] Guidelines. ... Section 21083 provides the Guidelines “shall include objectives and criteria for the orderly evaluation of projects and the preparation . of [EIRs] and negative declarations in a mannerconsistent with [CEQA].” (§ 21083, subd. (a).) The Guidelines therefore serve to make the CEQAprocesstractable for those who must administer it, those who must comply with it, and ultimately, those membersofthe public who mustlive with its consequences. 19 KOK OK Through these Guidelines, the Resources Agency gives public agencies a more concrete indication of how to comply with CEQA .... The Guidelines also prove consequential given that under section 21082, CEQA requires agencies subjectto its provisions .. . to adopt “objectives, criteria and procedures”for evaluating projects and preparing environmental documents.. . The Guidelines, in effect, enable the Resources Agencyto promote consistency in the evaluation process that constitutes the core of CEQA. And because these Guidelines allow the Resources Agency to affect how agencies comply with CEQA, they are central to the statutory scheme. (CBIA, supra, 62 Cal.4th at pp. 383-385.) Thus, CEQA contemplates that the Guidelines will fill gaps left in the termsofthe statutes to guide agencies in a variety of contexts. Section 21166 does not specifically address what agencies should do whenthe initial CEQA document wasa negative declaration. Because modifications of projects and project circumstances can happen regardless of the underlying document, Guidelines section 15162 appropriately fills the gap left in Section 21166. Section 21083 authorizes such gapfilling “in a mannerconsistent with [CEQA].” To that end, Guidelines section 15162 applies the same policies protecting finality and efficiency, and limiting subsequent EIRs, regardless of whetherthe initial CEQA document was an EIR or a negative declaration. Guidelines section 15162 is not arbitrary, capricious, or patently unreasonable, noris it clearly unauthorized or erroneous. Therefore, it should be afforded great weight, and upheld inits entirety. B. Previous Judicial Analyses Correctly Validated Guidelines Section 15162 No published decision has invalidated Guidelines section 15162. To the contrary, the First Appellate District and the Fourth Appellate District, in Benton and Abatti, correctly concluded that Guidelines section 15162 20 validly incorporates instructions for subsequent environmental review wherethe initial environmental document wasa negative declaration. (Abatti v. Imperial Irr. Dist., supra, 205 Cal.App.4th at pp. 668-674; Benton, supra, 226 Cal.App.3d at pp. 1477-1481.) The Benton court concluded that Guidelines section 15162 “promotes the purposesof section 21166, rather than violating the intent of the statute.” (Benton, supra, at p. 1481.) The court reasoned that Guidelines section 15162 furthers the policies of efficiency and early environmental review, expressed in Section 21003.1, by limiting the re-review ofan entire project when modifications to the project must be approvedafter a negative declaration has been finalized. (/d. at p. 1480.) As noted above, the Benton court also reasonedthat “requiring a greater level of review for a modification of a project on which a negative declaration has been adopted and a lesser degree of review of a modified project on which an EIR was initially required,” as maybe the case if Guidelines section 15162 only limited subsequent review following preparation of an EIR, “would be absurd.” (/bid.) The Fourth Appellate District, in Abatti, adopted the Benton court’s reasoning andholding. (Abatti, supra, 205 Cal.App.4th at pp. 669-674.) The court wasparticularly persuaded by “the central premise ofBenton that it makeslittle sense to set a Jower threshold for further environmental review ofa projectthat is determined nof to have significanteffect on the environmentthan section 21166 sets for a project that may havesignificant effects on the environment.” (/d. at p. 673.) The court also emphasized that the Guidelines were adopted pursuant to Section 21083, including “objectives andcriteria for. . . the preparation of environmental impact reports and negative declarations in a manner consistent with this division.” (Abatti, supra, at p. 672 [quoting Section 21083].) The court 21 properly found that Guidelines section 15162 is consistent with Section 21166. C. Construing Section 21166 and Guidelines Section 15162 Within the Context of Related CEQA Statutes Further Demonstrates the Validity of Guidelines Section 15162 Aspreviously noted, “every statute should be construed with reference to the whole system of law of whichit is a part.” (Moorev. Panish, supra, 32 Cal.3d at p. 541.) A further review of CEQAstatutes related to Section 21166 and Guidelines section 15162 augments and supports the analyses and holdings ofBenton and Abatti. Sections 21083, 21080.1, 21003, and 21003.1 are particularly relevant, for reasons largely already discussed above regarding the appropriate standard of review under Guidelines section 15162. Section 21083 was amendedin 1976 to authorize the Guidelines to include “objectives and criteria” for both EIRs and negative declarations. (RJN, Exh. 4.) Similarly, when Section 21080.1 was enacted in 1977, it accorded the samefinality to negative declarations as to EIRs,and itstill does. (RJN, Exh. 6.) According equal finality to those different environmental documents serves the policies of efficient and early environmental review embodied in Sections 21003 and 21003.1. (See also Benton, supra, 226 Cal.App.3d at p. 1480 [noting that Guidelines section 15162 furthers the purposes of Section 21003.1].) Based on thesestatutes, the Natural Resources Agencyjustifiably carried out the charge in Section 21166, and, more generally, its obligation under Section 21083 to prepare guidelines to “implement[]” CEQA,by incorporating limitations on subsequent environmental review, not just whenthe initial environmental documentis an EIR, but also when that documentis a negative declaration or mitigated negative declaration. 22 D. The Legislature’s Longstanding Awarenessof Guidelines Section 15162 Supports the Guideline’s Validity Aspreviously noted, “[t]he Legislature is deemed to be aware of existing laws andjudicial decisionsin effect at the time legislation is enacted and to have amendedstatutes ‘in the light of such decisions as have a direct bearing on them. 897, quoting Estate ofMcDill, supra, 14 Cal.3d at p. 839.) Likewise,“a (People v. Overstreet, supra, 42 Cal.3d at p. presumption that the Legislature is aware of an administrative construction of a statute should be applied if the agency’s interpretation of the statutory provisions is of such longstanding duration that the Legislature may be presumedto knowofit.” (Moore v. Cal. State Bd. ofAccountancy (1992) 2 Cal.4th 999, 1017-1018.) These principles support the validity of Guidelines section 15162. The Legislature should be deemed aware of both the longstanding administrative interpretation embodied by Guidelines section 15162, and the longstanding judicial validation of section 15162 embodied by Benton and Abatti. As noted above, the Legislature has amended CEQA ~ and, specifically, Sections 21083 and 21080.1 - multiple times in the 38 years since the predecessor to Guidelines section 15162 incorporated negative declarations, and in the 25 years since Benton first judicially validated that incorporation.'* Nonetheless, the Legislature has never enacted any change that would invalidate the longstanding authorities embodied in Guidelines section 15162, Benton, and Abatti. Given the Legislature’s apparent "* Since 1978,the Legislature has amended Section 21083 in 1981, 2002, and 2004, and has amended Section 21080.1 in 1993 and 1994, (RJN, Exh. 9.) The Legislature has not amended Section 21166 since 1977. Also, as discussed aboveat p. 13, Sections 21083.01 and 21083.09 are examples of the Legislature exercising its ability to require changesto the Guidelines where it deems such changes necessary. 23 acquiescence, this Court should uphold the last 38 years of regulatory certainty, relied upon by countless agencies, project applicants, and the public over those many years. Guidelines section15162 validly interprets, implements, and serves the purposesof Section 21166. III. THE SUBSTANTIAL EVIDENCE STANDARD OF JUDICIAL REVIEW ALSO APPLIES TO AN AGENCY’S DETERMINATION THATAN ACTIVITY IS A MODIFICATION TO A PREVIOUSLY APPROVED PROJECT, AND THAT THE LIMITATIONS IN SECTION 21166 APPLY The parties argued a related point at oral argument: howcourts should review an agency’s determination that its action is a modification to a previously approvedproject, and is therefore subject to Section 21166’s limitation, or is instead a wholly new project to which Section 21166 does not apply. Although the Court of Appeal, Third Appellate District, in Save Our Neighborhoodv, Lishman (2006) 140 Cal.App.4th 1288, treated this as a question oflaw,it is instead a factual determination addressed by Section 21166. The agency’s determination should be upheld if supported by substantial evidence in the record. Section 21166 limits further review “unless one or more ofthe following events occurs:(a) Substantial changes are proposedin theproject which will require major revisions of the environmental impactreport. . . .” (Pub. Resources Code, § 21166, subd.(a), italics added.) Theitalicized wordsin the statute are inherently factual in nature.'? The occurrenceof an “event”is a fact. To determine whether a “substantial change” has occurred, an agency must evaluate facts and reach a conclusion based upon them (i.e., did a “change”occur, and wasthat change “substantial”). Similarly, determining the degree ofrevision needed in an existing '? The Natural Resources Agency quotes subdivision (a) by way of example, but the other two conditionsidentified in Section 21166 are also inherently factual in nature. 24 environmental document requires the agency to draw conclusions based on a review offacts. Often, this determination will require a lead agency to review andinterpret its own environmental document- an exercise as to which courts typically defer to the agency’s judgment. (See, e.g., Seguoyah Hills HomeownersAssn. v. City ofOakland (1993) 23 Cal.App.4th 704, 719 [Once a general plan is in place, it is the province ofelected city officials to examine the specifics of a proposed project to determine whetherit would be ‘in harmony’ with the policies stated in the plan.”); Stone v. Board ofSupervisors (1988) 205 Cal.App.3d 927, 934-937 [agency’s interpretation of conditions in its own permit is reviewed under a deferential “reasonableness” standard].) | In Lishman, the Third Appellate District adopted a different view. Citing Benton, the court treated the question as one of law. (Lishman, supra, 140 Cal.App.4th at p. 1297, citing Benton, supra, 226 Cal.App.3dat pp. 1475, 1477.) Notably, the court in Benton did notstate that this question is one of law. Instead, it examinedthe facts in the administrative record and found evidence supporting the agency’s conclusion that the project at issue was a modification to a previously approvedproject, rather than a brand new project. (Benton, supra, 226 Cal.App.3dat pp. 1475- 1477 [notingthat, “[o]n this record, weare satisfied that the project before - the board was a modification ofthe existing winery project, not an entirely new project,” consistent with the agency’s treatmentofthe project].) That the court in Benton examinedthe administrative record, and highlighted facts supporting the agency’s conclusion, suggests that it actually reviewed the question under a substantial evidence standard. The decision in the Lishman case should not, therefore, persuade this Court, if this Court chooses to address thisissue in its written opinion. Rather, because the language of Section 21166 calls on public agencies to makea factual determination regarding its applicability to a given activity, 25 A > S E R R E A t e this Court should find that determination to be subject to the substantial evidence standard of review. TV. GUIDELINES SECTION 15162, AND APPLYING THE SUBSTANTIAL EVIDENCE STANDARD TO IT, AFFORDS ADEQUATE SAFEGUARDSAGAINST ABUSE OF DISCRETION The substantial evidence standard embodied in Guidelines section 15162 does not weaken the environmental review and public comment requirements of CEQA.First, as discussed above, any project potentially subject to Guidelines section 15162 must necessarily have already gone through the “fair argument” assessment by the lead agency required by Section 21151. By definition, if a project has reached the point where Guidelines section 15162 is applicable, the result of the agency’s initial assessment of impacts under Section 21151 is beyond challenge, regardless of whetherthat culminated with an EIR or a negative declaration. (STOPv. City and County ofSan Francisco, supra, 74 Cal.App.4th at pp. 799-800.) Nothing about Guidelines section 15162 strips awayoralters the initial “fair argument” assessment under Section 21151. Further, the agency’s initial “fair argument” assessment underSection 21151 inherently protects against failures to evaluate reasonably foreseeable project modifications that could have significant environmental effects. As part of that initial process, an agency must considerthe environmental effects of future expansion ofa project, or other action on a project, if: “(1) it is a reasonably foreseeable consequenceoftheinitial project; and (2) the future expansion or action will be significant in thatit will likely change the scope ornature ofthe initial projector its environmental effects.” (Laurel Heights I, supra, 47 Cal.3d at p. 396.) This protects against the possibility that reasonably foreseeable project modifications, that may have significant environmental effects, will be 26 ignored or otherwise not properly analyzed during the initial environmental review. | Evenafter the initial environmental review is complete, and “the interests offinality [become] favored overthe policy of encouragingpublic comment,” (Laurel Heights II, supra, 6 Cal. 4th at p. 1130), safeguards remain to ensure CEQA’s environmental protection goals. For example, this Court has acknowledged the protection built into Section 21166 and Guidelines section 15162. In Laurel Heights I, this Court notedthat, “[o]f course,”if a future significant project modification is not considered during the initial environmental review under Section 21151, “it will have to be discussed in a subsequent EIR before the future action can be approved under CEQA.” (Laurel Heights I, supra, 47 Cal.3d at p. 396.)"* The effectiveness of this safeguardis illustrated in American Canyon Community Unitedfor Responsible Growth v. City ofAmerican Canyon (2006) 145 Cal.App.4th 1062 (“American Canyon”). In American Canyon, the city adopted a mitigated negative declaration for a multi-use developmentproject and then decided, under Section 21166, that modificationsto the project did not require a subsequent EIR. (id. at p. 1066.) The modifications included changing “the size and typeofretail development. . ., replacing a shopping center with a 24-hour supercenter that combined a big-box discountstore and a full grocery store.” (Jbid.) The appellate court held that the city’s determination was not supported by substantial evidence, and remandedto thetrial court to issue a writ '* Additionally, as noted above at p. 17, Guidelines section 15164, subdivision (e), provides that, if an agency determines that no further environmental review is necessary, it should explainits rationale and evidence “in an addendum to an EIR,[its] required findings on the project, or elsewhere in the record,” and that “explanation must be supported by substantial evidence.” 27 requiring the city to comply with Section 21166. (/d. at pp. 1066, 1077- 1081, 1083, 1085.)"° Guidelines section 15162, subdivision (c), provides another safeguard, applying even after the lead agency’srole in project review and approvalis complete: If after the project is approved, any of the conditions described in subdivision (a) occurs, a subsequent EIR or negative declaration shall only be prepared by the public agency which grants the next discretionary approval for the project, if any. Jn this situation, no other responsible agency shall grant an approvalfor the project until the subsequent EIR has been certified or subsequent negative declaration adopted. (Italics added.) Thus, subdivision (c) requires responsible agencies, making discretionary approvals of a project, to act as a backstop ensuring subsequent environmental review where necessary. Any decision under subdivision (c) would, as with subdivision (a), be reviewed for substantial evidence. However, although that standard is more deferentialto the agency than is the “fair argument”test, it is not a judicial rubber stamp. It appropriately requires the agency to substantially support its decision, while still serving the interests offinality, certainty, and efficiency that take precedence oncethe initial environmental review is beyond challenge. In Concerned Citizens ofCosta Mesa, Inc. v. 32nd Dist. Agricultural Assn. (1986) 42 Cal.3d 929, this Court articulated another safeguard that '° Examples are easy to imagine, in which the record could not contain substantial evidence supporting a determination that project modifications did not create new significant impacts not previously analyzedin the original environmental document. One such example could be wherea project originally had no impactsto biological resources, but a modified project footprint would impact a wetland. In that example, there wouldlikely not be substantial evidence in the record to support a determination that impacts to biological resources would be no more severe than previously analyzed. 28 exists after the initial environmentalreviewis final. In that case, the public received no notice of substantial changes to an amphitheater project until after the amphitheater was constructed andin use.’® The Court created a form of discovery rule, tolling the statute of limitations wherea projectis substantially modified without public notice. Specifically, the Court held that “an action challenging noncompliance with CEQA maybefiled within 180 daysofthe time the plaintiff knows or should have knownthatthe project under way differs substantially from the one describedin the initial EIR.” (Id. at p. 933.)"” Finally, although the standard ofjudicial review applicable to decisions under Guidelines section 15162 is the same regardless of whether the initial environmental documentis a negative declaration or an EIR, practical application of the Guideline may be morelikelyto result in subsequent environmental review wherethe initial documentis a negative '® When an agency approves a project, it must file a notice with OPR (if the approving agencyis a state agency) or with the clerk of the county in which the project will be located (if the approving agency is a local agency). The notice must indicate the agency’s determination whether the project will, or will not, have a significant effect on the environment, and whether an EIR has been prepared. (Pub. Resources Code, §§ 21108, 21152.) This notice causesthe statute of limitations to begin running on most challenges to the agency’s approval. (Pub. Resources Code, § 21167, subds. (b)-(e).) The administrative record for the project should support the agency’s decisions and provide the public with sufficient information about the project. (See, e.g., Guidelines section 15164, subd.(e).) '’ To the Natural Resources Agency’s knowledge, in the 38 years since the predecessor to Guidelines section 15162 incorporated negative declarations, there have been nocases wherein a public agencyinitially misidentified a project for the purposes of evading “fair argument” review with the intent to subsequently modify the project and take advantageofthe more deferential substantial evidence standard. However, if such a case were to occur, substantial evidencelikely would not support the agency’s action, and this Court’s Costa Mesa decision inspires confidence that the courts could review andrectify the abuse. 29 declaration. This is because an EIR must consider project alternatives, and the significant environmental effects of those alternatives, whereas a negative declaration need not describe alternatives. (Cal. Code Regs., tit. 14, §§ 15063, 15071, 15126.6.) Therefore, any new significant effect resulting from a project modification might already appear, and be sufficiently discussed,as a project alternative in an EIR. Conversely, because a negative declaration and accompanyinginitial study are often by their nature limited in scope, and need not discuss alternatives, that same new significant effect wouldbe less likely to have been previously and sufficiently discussed. Ultimately, the substantial evidence standard, as applied to agency decisions under Guidelines section 15162, does not serve to hide or prevent review ofsignificant environmental effects, but instead properly defers to the agency’s determination about whetherthe previous environmental document remains adequate, provided that determination has the requisite support. CONCLUSION The substantial evidence standard ofjudicial review applies to an agency’s determination, under Guidelines section 15162, that no subsequent EIR is required on a project’s modification where the previous documentis a negative declaration. Further, Guidelines section 15162 is a valid interpretation of Section 21166. The Natural Resources Agency respectfully requests that this Court so hold.!8 'S Alternatively, if the Court is not convincedofthe validity of Guidelines section 15162, the Natural Resources Agency respectfully requests that, rather than invalidate the Guideline outright on a short briefing schedule and sparse record, where the relevant agencyis not even a party, the Court instead remand the question for an appropriate challenge, on a complete administrative rulemaking record, pursuant to Government Code section 11350. 30 Dated: June 14, 2016 SA2016300886 Brief.doc Respectfully submitted, KAMALAD. HARRIS Attorney General of California ROBERT W. BYRNE Senior Assistant Attorney General TRACY L. WINSOR Supervising Deputy Attorney General hie JPFFREY P. REUSCH eputy Attorney General Attorneysfor California Natural Resources Agency and Governor’s Office ofPlanning and Research 31 CERTIFICATE OF COMPLIANCE I certify that the attached SUPPLEMENTAL BRIEF OF THE CALIFORNIA NATURAL RESOURCES AGENCY AND THE GOVERNOR’S OFFICE OF PLANNING AND RESEARCHusesa 13 point Times New Romanfont and contains 8,956 words. Dated: June 14, 2016 KAMALAD.,HARRIS Attorney General of California aa, JEFFREY P. REUSCH Deputy Attorney General Attorneysfor California Natural Resources Agency and Governor’s Office ofPlanning and Research DECLARATION OF SERVICE Case Name: FRIENDS OF THE COLLEGE OF SAN MATEO GARDENSvy, SAN MATEO COUNTY COMMUNITY COLLEGE DISTRICT Case No.: 8214061 I declare: I am employedin the Office of the Attorney General, which is the office of a memberofthe California State Bar, at which member’s direction this service is made. I am 18 years of age or older and not a party to this matter; my business address is 1300 I Street, Suite 125, P.O. Box 944255, Sacramento, CA 94244-2550. - On June 15, 2016, I served the attached SUPPLEMENTAL BRIEF OF THE CALIFORNIA NATURAL RESOURCES AGENCY AND THE GOVERNOR’S OFFICE OF PLANNING AND RESEARCHbyplacing a true copy thereof enclosed in a sealed envelope with postage thereon fully prepaid, in the United States Mail at Sacramento, California, addressed as follows: California Supreme Court Original + 8 copies Earl Warren Building 350 McAllister Street, Room 1295 Sent via Overnight (Golden State Overnight) San Francisco, CA 94102 California Court of Appeal 1 copy First Appellant District 350 McAllister Street Sent via Overnight (Golden State Overnight) San Francisco, CA 94102 Hon.Clifford Cretan 1 copy San Mateo County Superior Court 222 Paul Scannell Drive Sent via Overnight (Golden State Overnight) San Mateo, CA 94402 Susan Lynne Brandt-Hawley Attorney for Friends of the College of San Brandt-Hawley Law Group Mateo Gardens: Plaintiff and Respondent P.O. 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AW