Is there an environmental impact report in your future? If you are among those planning a development project within the geographic boundaries of the Bay Area Air Quality Management District (“BAAQMD”) or even beyond, odds that the answer is “yes” just increased. According to new “interim” Guidelines adopted in June 2010, BAAQMD established “thresholds of significance” for purposes of evaluating the environmental effects of greenhouse gas (“GHG”) emissions from proposed projects under the California Environmental Quality Act (“CEQA”). If a project exceeds the thresholds, CEQA requires preparation of an environmental impact report (“EIR”). While these comprehensive quantitative thresholds are only legally binding when BAAQMD is the lead agency, other state and local agencies in California likely will rely on these Guidelines with the thought of reducing the risks of legal challenge.

CEQA calls on state and local agencies to review the environmental effects of projects before approving them, and toward that end, generally requires agencies to prepare and consider either brief initial studies and “negative declarations” or longer EIRs. It is a recent development that CEQA documents have addressed climate change impacts at all – so recent that the first case to test whether GHG emissions must be analyzed in EIRs was filed in only 2006.

As the scientific consensus and public understanding of climate change grew, California passed a series of laws, including AB 32, SB 375, and SB 97, outlining a statewide response. These laws are based on the premise that reductions in GHG emissions must come from every sector of the economy and from emission sources of many types and sizes. AB 32, passed in 2006, set a GHG emission cap for the state as a whole and required the Air Resources Board to establish regulations to reduce California’s GHG emissions to 1990 levels by 2020, a reduction of approximately 30 percent. Signed by the Governor in 2007, SB 97 creates a “coordinated policy” for approaching CEQA and climate change and makes clear that GHG emissions are an appropriate subject for CEQA analyses across the state. In 2008, the Legislature passed SB 375 to set specific regional targets for GHG emissions from the transportation sector and to incentivize more efficient regional growth.

California’s response to climate change has come in other forms as well. CEQA litigation by the Attorney General has resulted in a number of major settlements with requirements to inventory or mitigate GHG emissions at facility, city, and county levels. The Governor also has issued a series of Executive Orders providing approaches for dealing with climate change, including identifying specific targets for GHG emission reductions. Efforts to set statewide significance thresholds at the Air Resources Board halted in 2008 with a Preliminary Draft Staff Proposal that has no indication of being picked up again in the near future. Earlier this year, the Office of Planning and Research enacted the first CEQA Guideline pertaining to GHG emissions. Section 15064.4 directs lead agencies to estimate GHG emissions but fails to set GHG emission thresholds. This has left local and regional agencies with the responsibility for determining what levels of GHG emissions are significant, despite the state agencies’ greater expertise.

Under BAAQMD’s new thresholds, GHG emissions of a project are presumed insignificant if the GHG emissions remain below enumerated thresholds or if the project complies with a “Qualified GHG Reduction Strategy.” For residential, commercial, industrial, and public land use projects, emissions of more than 1,100 metric tons of carbon dioxide equivalent per year or 4.6 metric tons of carbon dioxide equivalent per year per person (residents and employees) will be considered to have significant effects. These thresholds correspond roughly to a 56-unit single-family housing project, an 83-room hotel, a general office building of 53,000 square feet, or a regional shopping center of 19,000 square feet. For stationary-source projects, the threshold level is 10,000 metric tons of carbon dioxide equivalent per year.

Through these relatively low thresholds, BAAQMD is encouraging local and state agencies to adopt qualified GHG Reduction Strategies consistent with AB 32 goals. Those strategies can consist of a general plan or “climate action plan,” or can be comprised of a collection of climate action policies, ordinances, and programs that have been legislatively adopted by a local jurisdiction. But, if the jurisdiction fails to adopt a Reduction Strategy, compliance with BAAQMD’s thresholds will likely increase the number of projects that require EIRs because the thresholds are so low that cumulative impacts cannot be mitigated to a less-than-significant level. A project with significant and unavoidable impacts can only be approved with a “statement of overriding consideration” explaining its reasons for approval despite significant unmitigated environmental effects. This in turn will slow down and complicate an already complex, expensive, and lengthy environmental review process.

Because BAAQMD is the only agency to conduct a detailed analysis and provide a thorough justification for its GHG thresholds, the District’s interim Guidelines are likely to become the measuring stick across the state. Other local and state agencies are sure to adopt similar or identical thresholds. Agencies can adopt thresholds that substantially differ from the District’s, but they should support any such thresholds with substantial evidence and a sound explanation.

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

* William Most is a law clerk at Briscoe Ivester & Bazel LLP and a J.D. candidate at the University of California, Berkeley, School of Law.

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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