By David M. Greenwald
Earlier this week, I noted the continued problems with CEQA and its ability to thwart housing projects—and then a California Appellate Court on cue provided a case study to illustrate exactly that.
While the appellate court rejected some of the more onerous arguments put forward by neighborhood groups attempting to stop a student housing plan at the People’s Park in Berkeley, it did block, at least for now, UC Berkeley from building student housing and opens a new avenue for future groups to block development using the increasingly controversial state environmental law.
This will not be the final say, as the university will appeal the ruling to the state Supreme Court—but for now, it’s a problem beyond the immediate concern of student housing in Berkeley.
Facing a mounting housing crisis and an acute shortage of affordable campus housing, along with rising homelessness and housing insecurity, the university put forth a plan to redesign the park to provide about 1,100 student beds, along with 125 beds for lower-income and formerly unhoused people.
The court ruled with “Good Neighbor” on two critical arguments. First that the “EIR failed to justify the decision not to consider alternative locations to the People’s Park project.” And second and more ominous, “it failed to assess potential noise impacts from loud student parties in residential neighborhoods near the campus, a longstanding problem that the EIR improperly dismissed as speculative.”
It could have been worse.
The court wrote, “We are unpersuaded by Good Neighbor’s contention that the EIR was required to analyze an alternative to the long range development plan that would limit student enrollment.”
They added, “We also reject Good Neighbor’s view that the EIR improperly restricted the geographic scope of the plan to the campus and nearby properties, excluding several more distant properties. Nor did the EIR fail to adequately assess and mitigate environmental impacts related to population growth and displacement of existing residents.”
Good Neighbor arguments were that “unplanned and unmitigated population growth would exacerbate the city’s existing homeless crisis” and would lead “to physical impacts on parks, streets and other public spaces, public safety issues related to homeless encampments locating in unsafe locations, and an increase in public health problems.”
The court calls this evidence for this kind of displacement theory “insufficient.” They write, “The theory may appeal to common sense, and it may ring true in a region with crazy housing costs and rampant homelessness.”
In short, the court said that opponents failed to present the type of evidence or expert opinion that their worst-case scenario would come true.
But where the court did rule—with regard to noise and other impacts—critics have denounced the ruling.
“The campus is dismayed by this unprecedented and dangerous decision to dramatically expand CEQA, and the campus will ask the California Supreme Court to overturn it,” the school said in a statement.
“Left in place, this decision will indefinitely delay all of UC Berkeley’s planned student housing, which is desperately needed by our students and fully supported by the City of Berkeley’s mayor and other elected representatives,” the statement said. “This decision has the potential to prevent colleges and universities across the State of California from providing students with the housing they need and deserve.”
As UC Davis Law Professor Chris Elmendorf explained, “To hold that CEQA requires analysis of behavioral tendencies of demographic groups brought into a neighborhood by a project is to invite invite all kinds of ugly challenges to affordable housing, shelters, group homes, rehab centers, etc.”
Elmendorf pointed out, “To establish that student noise is a genuine problem, not a fiction grounded in prejudice, the court relies on (1) City of Berkeley’s legislative finding that noise from student parties is ‘intolerable,’ and (2) ‘public comments based on personal observations’ and the University’s own efforts to mitigate student noise.”
But he said, “But the court’s distinction between ‘genuine’ behavioral issues and ‘prejudice[d]’ speculations about such issues won’t prevent the weaponization of its holding.”
The question is what happens next.
Governor Newsom in a statement on Saturday called the CEQA process “clearly broken,” noting that “a few wealthy Berkeley homeowners” have the ability through the law and litigation to “block desperately needed student housing for years and even decades.”
He said, “California cannot afford to be held hostage by NIMBYs who weaponize CEQA to block student and affordable housing.”
The governor continued, “This selfish mindset is driving up housing prices, and making our state less affordable.” He said, “The law needs to change, and I am committed to working with lawmakers this year to making more changes so our state can build the housing we desperately need.”
Thank you, @GavinNewsom, for understanding how badly broken CEQA is, how badly it harms our housing goals, & how badly it needs structural reforms. You have our commitment to work with you & your Administration to get this done. pic.twitter.com/g2r33OLgdj
— Senator Scott Wiener (@Scott_Wiener) February 26, 2023
Senator Wiener in response to the governor’s statement, thanked the governor “for understanding how badly broken CEQA is, how badly it harms our housing goals, & how badly it needs structural reforms.”
He tweeted, “You have our commitment to work with you & your Administration to get this done.”
From the perspective of Elmendorf, however, he tweeted, “This is a carefully written opinion. While I am not at all convinced by the court’s response to my pragmatic concerns about the ‘bad behavior & demographics’ holding, the court does a good job grounding its decision in statutory text & precedent.”
That could make it difficult for the court to overturn it.
Last year a similar problem in Berkeley saw the Supreme Court decline to hear the case, forcing the state legislature to act.
Tweeted Elmendof, “I wish Berkeley the best of luck with its appeal, but the CEQA problems highlighted by the new opinion are crying out for a legislative fix. Quite simply, the local effects of adding more people to an already urbanized area should not be CEQA impacts. Period.”
While the governor and Senator Wiener clearly signaled some support for the legislative route, as we noted earlier this week, in the past that has proven difficult.
Noah DeWitt, writing for the Pepperdine Law Review, argues that the legislature has repeatedly failed to pass major CEQA reforms—for a variety of reasons. And when it has, DeWitt has found that most have yielded minor if non-existent results.
The state has attempted to streamline some of those processes, and create exemptions to CEQA, but as we know, even those exemptions carry with them procedural hurdles and can form the basis for litigation.
What has passed—notable bills like SB 35, SB 540, and AB 73—have “fatal flaws,” particularly trading CEQA exemptions for costly prevailing wage obligations. These have pleased labor interests, but they have at the same time undermined the benefit of streamlining.
DeWitt argues that California should look toward three other states—Massachusetts, Minnesota, and New York—as each has “reformed their environmental statutes in ways that can provide California with solutions to its own CEQA barriers.”
This particular case might require a simpler fix—simply eliminate this kind of analysis from a CEQA review.
There is no doubt efforts will emerge to reform CEQA, but if history is a guide, I wouldn’t hold my breath on any sort of legislative fix that goes broader than the current situation in Berkeley.