How could a new CEQA law impact your city’s infill housing projects?
Posted on Friday, May 3rd, 2024 at 9:24 pm
(As published in League of California Cities Western City magazine / Legal Notes on May 1, 2024 / https://www.westerncity.com/article/how-could-new-ceqa-law-impact-your-citys-infill-housing-projects)
How could a new CEQA law impact your city’s infill housing projects?
Solange Z. Fortenbach is an associate attorney at Burke, Williams, & Sorensen, LLP. She can be reached at (949) 863-3363 or sfortenbach@bwslaw.com. Stephen E. Velyvis is a partner at Burke, Williams & Sorensen, LLP. He can be reached at (415) 655-8133 and svelyvis@bwslaw.com.
Fifty-six new housing laws came into effect in California this January — including AB 1633 (Ting), which limits environmental challenges for infill residential developments. This new law does not amend the California Environmental Quality Act (CEQA). Instead, it clarifies that withholding approval of a housing development that otherwise meets the state’s environmental review law could be a violation of the Housing Accountability Act (HAA).
AB 1633 is part of a years-long legislative effort aimed at breaking the state’s housing construction logjam. AB 1633 seeks to avoid the practice of using CEQA to block infill housing development projects.
In essence, AB 1633 allows developers to formally protest when projects they believe are entitled to CEQA exemptions are subject to a CEQA review. If an agency fails to respond in time, a court can rule that the local agency violated the HAA. This can happen if a developer successfully shows an infill project is categorically exempt from CEQA, but a local agency requires additional environmental review or fails to adopt or certify certain environmental documents for a qualified housing project.
When does AB 1633 apply?
This new law only applies to certain housing development projects. A housing project must be in an urban area which, among other criteria, has one or more of the following:
- It is within a half-mile walking distance of transit.
- It is in a very low-vehicle travel area.
- It is close to six or more amenities defined in the statute, such as a bus station or grocery store.
The housing project must also meet or exceed 15 dwelling units per acre and not be in a very high fire hazard severity zone.
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How does this law work?
AB 1633 expands the definition of “disapproving a housing development project” to include when a local agency abuses its discretion or fails to determine that a project is exempt from CEQA if certain criteria are satisfied. Developers can require a local agency to move the project along if the agency fails to act on an applicable CEQA exemption or incorrectly finds that an exemption does not apply.
This only happens if the developer initiates the process. Project applicants must give written notice to the local agency of the action or inaction that the applicant believes halted the project. The agency has 90 days to make a determination about the exemption before they will be considered to have disapproved of the housing development project.
The local agency may provide a written response to the applicant within 90 days of receiving the notice to extend the period — no more than 90 days — under certain requirements. If there is substantial evidence in the record that a CEQA exemption applies — and no potential exceptions to the exemption are present — then the local agency must find the project exempt from CEQA. If not, it will face liability under the HAA for inappropriate action that amounts to an illegal disapproval of a housing development.
AB 1633 also states that a project will be considered disapproved if the local agency fails to adopt or certify certain environmental review documents despite having held a meeting where such action could have been taken. Applicants can provide notice to local agencies of the action or inaction they believe meets these criteria. The agency then has 90 days to decide whether to adopt, approve, or certify the environmental review document. If it fails to make a lawful determination within 90 days, no opportunity to extend the decision timeline will be provided. The project will be deemed disapproved, and the local agency may face liability under the HAA.
Other key changes
AB 1633 also modifies the criteria used to assess whether an attorney fees award should be granted to a successful project challenger to give a local agency some relief if it makes a good faith effort to follow the requirements. If the local agency improperly denies a project, a party challenging a project’s denial ordinarily recovers attorney fees from a local agency if it prevails in a lawsuit. However, if a court finds that a local agency improperly required additional CEQA review but made the violation in good faith based on a reasonable difference in opinion about CEQA’s requirements, then it will not be liable for attorneys’ fees.
The law also provides some protection for a local agency that approves a project in reliance on the CEQA process required under AB 1633. Specifically, state law now provides two levels of protection for local agencies in their decision-making based on the criteria of the proposed housing development project. The first protection, the “due weight” protection, applies to all housing development projects. It requires courts considering fee motions to give due weight to three new factors:
- Whether the local agency’s approval furthers the HAA.
- The site suitability of the project.
- The reasonableness of the decision of the local agency.
A second, heightened protection only applies to certain projects and requires that attorneys’ “fees should rarely, if ever, be awarded” if the housing development project is in an area that meets certain criteria.
As an example of the second standard: A court is considering a project within a half-mile walking distance of high-quality transit with a density that meets or exceeds 15 dwelling units per acre. If a local agency approves that development, but a project opponent successfully challenges the approval under CEQA, attorneys’ fees should rarely, if ever, be awarded to the petitioner if the approval was given in good faith.
In sum, AB 1633 provides greater protection for certain housing development projects that are being unreasonably delayed through the CEQA process. As a result, local agencies should be more cautious when deciding to delay or disapprove certain housing developments to ensure sufficiency in their decision-making. AB 1633 will sunset after seven years, giving the Legislature time to check whether the law’s protections are effective at increasing housing production.
