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State Supreme Court Rules CEQA Inapplicable to Approval of Pro-Wal-Mart Initiative

by on August 12, 2014

posted in CEQA, Elections, Initiatives,

Californians are fond of government by initiative.  At the ballot box, state voters have registered their preferences on a number of hot-button issues.  Voters have done the same at the local level, often using the initiative power to slow the pace of growth and gain control over land use.

A recent State Supreme Court case signals a new trend in the use of initiatives may be emerging.  In Tuolumne Jobs & Small Business Alliance v. City of Sonora, the Court considered whether review under the California Environmental Quality Act (“CEQA”) is required when a city council chooses to enact an initiative petition rather than submit it to voters.  Unlike the typical situation in which an initiative proposes to stop a particular development, the petition at issue in this case proposed to approve a development application—specifically, the expansion of an existing Wal-Mart into a 24-hour “Supercenter” that would sell groceries.

Because of a unique feature of California’s initiative law, the city council in this case was able to summarily approve the initiative, without submitting it to the voters.  The council did so by invoking Elections Code section 9214, which provides that when a city receives an initiative petition signed by more than 15% of its registered voters, it has the option to approve the initiative without alteration, or submit the measure to its voters.  The council chose the former option, effectively approving the Wal-Mart project in a way that foreclosed further public consideration.

A group of local merchants challenged this action, claiming the council could not summarily approve the project without first conducting a proper review under CEQA.  A unanimous Supreme Court rejected their appeal.

Comparing the statutory language governing initiatives to that governing CEQA, the Court found no way to reconcile the former’s timing for acting on a proposed initiative measure with the latter’s timelines for environmental review.  Its opinion was long, but generally speaking, the Court found that:

  • As a city council generally must act upon a proposed initiative within 10 days of receipt—and can extend that time by no more than 30 days in certain instances—a city could never conduct review under CEQA prior to enacting the proposed measure.
  • There is no evidence in the legislative record that the Legislature intended for CEQA review to occur prior to action on a proposed initiative.

A New Era for Pro-Development Initiatives?

The Supreme Court’s decision that an agency need not conduct CEQA review prior to approving an initiative petition all but ensures that the initiative power will become a tool to promote certain pro-development interests.  Where a city council or county board of supervisors is believed to be friendly to a particular development proposal, a project applicant can seek fast-track approval of its project if it—no doubt working behind the scenes with others—can get a sufficient number of registered voters to sign an initiative petition supporting its project and then get a council or board majority to approve.

Especially since CEQA review can be very expensive and CEQA lawsuits can slow down development and jeopardize project viability, this potential to obtain summary project approval will be very attractive to many project applicants.

Oh, the Irony

The initiative power was given to California voters more than a century ago to combat the power of the railroads and their control over California politics.  Today, there is no shortage of commentators who have noted the ironies of the initiative’s modern use as a tool for special interests to bypass normal political processes.  The Supreme Court’s decision appears to signal yet another irony, the pro-development initiative.

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tags: Big-box Retail, CEQA, Elections Code, Initiatives,

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