The answer, following the logic of a case decided by the California Supreme Court last week, may well be ‘yes’.  That case, Pacific Palisades Bowl Mobile Estates, LLC v. City of Los Angeles, concluded that a permit is required for all “changes in density or intensity of use” in the Coastal Zone—regardless of whether any changes actually occur.  If the Legislature does not step in, a permit might now be required to do, or contemplate doing, almost anything at all along the California coast.

The Coastal Act generally requires any person wishing to perform or undertake any “development” near the coast (within a statutorily-defined area called the “Coastal Zone”) to obtain a “Coastal Development Permit”.  The Coastal Commission issues these permits, except where it has certified local governments to do so.  The Legislature could have defined “development” as the term is commonly understood:  as an activity that “changes undeveloped property into developed property”.[1]  Instead, it defined the term to include a surprising array of activities:

  •  “the placement or erection of any solid material or structure”;
  • “discharge or disposal of any dredged material or of any gaseous, liquid, solid, or thermal waste”;
  • “grading, removing, dredging, mining, or extraction of any materials”;
  • change in the density or intensity of use of land, including, but not limited to subdivision under the Subdivision Map Act. . . and any other division of land, including lot splits”;
  • “change in the intensity of use of water, or of access thereto”;
  • “construction, reconstruction, demolition, or alteration of the size of any structure”; and
  • “the removal or harvesting of major vegetation”.[2]

The Coastal Act exempts a few specific categories of activities from the permitting requirement, such as minor improvements to existing single-family homes, maintenance dredging, and the replacement of structures destroyed by natural disaster.  The Coastal Commission’s executive director also has the discretion, after a public hearing, to waive the permit requirement for “de minimus” developments.  Otherwise, the failure to obtain a permit for any “development” is punishable by a civil penalty of between $1,000 and $15,000 per day.

In the Pacific Palisades case, the owner of a 170-unit mobilehome park in the Los Angeles Coastal Zone wanted to convert the park from tenant occupancy (like an apartment) to resident ownership (akin to a cooperative).  Under the Subdivision Map Act, subdivisions of land like this require the approval of local governments.  The City of Los Angeles refused to accept the owner’s application for a subdivision, however, because it did not also include an application for a Coastal Development Permit.  The owner filed suit, arguing, among other things, that the proposed conversion was not a “development” under the Coastal Act.  The trial court agreed, the Court of Appeal reversed, and the Supreme Court affirmed in a 6-1 opinion authored by Justice Werdegar.

The Supreme Court began its analysis by noting that the Coastal Act requires permits for “development”, and “development” is defined to include “subdivision under the Subdivision Map Act”.  Since a mobilehome park conversion to resident ownership constitutes a “subdivision under the Subdivision Map Act”, the Court reasoned, it is “by definition” also a “development” requiring a permit under the plain terms of the Coastal Act.

The Supreme Court could have stopped right there, but it went on to offer what it called an “expansive interpretation” of “development” under the Coastal Act.  The Court emphasized that the term applies to any “change” in the intensity of use, such that “a project that would decrease intensity of use, such as by limiting public access to the coastline or reducing the number of lots available for residential purposes, is also a development”.  Even if the conversion would cause no immediate change in use, it would still be “development” because of the “possibility” of changes in the future, such as “problematic design features as owners express their individuality” or an “increase [in] the number of residents in their units”.  (The Supreme Court did not comment on the possibility that mobilehome tenants, and not just owners, might ever also want to exercise their rights of individual expression or have children.)

Justice Kennard dissented on this last point.  For her, a subdivision that “does not change the density or intensity of use of the land, but merely changes the form of its ownership”, does not fall within the “plain meaning” of the statute.  She interpreted the phrase “change in density or intensity of use of land” to qualify “subdivision”, such that only subdivisions that actually change land uses constitute “development”.

None of the Supreme Court’s seven justices articulated any other limits to the Coastal Act’s jurisdiction, and so Californians may be left wondering whether activities they may take for granted near the coast might now require a permit (or the executive director’s blessing).  Having a baby, or a fatal heart attack, would change the population.  Raising prices at a restaurant, or offering a new special, might attract a different clientele.  Simply going out of business could affect the coastal economy.  Under the logic of Pacific Palisades, each of these activities might constitute “development” because they all have at least the potential to change how the coast is used.

The courts might disregard the Supreme Court’s “expansive interpretation”, since it was not necessary to the decision and thus mere dicta.  The courts might also limit the opinion out of constitutional concerns.  If not, perhaps the Legislature will be tempted to amend the statute to define “development” as it is more commonly understood.  But it had better not hold a special session near the coast to do so—it might just need a permit for that.



[1] Black’s Law Dictionary (8th ed.) at 482.

[2]Cal. Pub. Res. Code § 30106 (emphasis added).

 

Peter Prows

Briscoe Ivester & Bazel LLP
155 Sansome Street, 7th Floor
San Francisco, CA 94104
Telephone: (415) 402-2700
Fax: (415) 398-5630

Disclaimer: In our Newsletters and Bulletins, Briscoe Ivester & Bazel LLP intends to present general information to the public and does not intend to provide legal advice pertaining to a particular situation.

 

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