In a partially published opinion filed on November 3, 2021, involving the CEQA review for a bed and breakfast/commercial event project proposed on property within a Yolo County agricultural zone, the Third District Court of Appeal (in a unanimous opinion authored by Justice Robie) reaffirmed the basic CEQA principle that a “full EIR” must be prepared whenever a project may have any significant environmental effect; it thus reversed the trial court’s judgment that had allowed a deficient revised Mitigated Negative Declaration (MND) and its mitigation measures to remain intact while ordering Yolo County to also prepare an EIR limited to addressing only the project’s impacts on three species of concern (tricolored blackbird, valley elderberry longhorn beetle, and golden eagle).  The Court of Appeal reversed and remanded with instructions to issue a peremptory writ directing the County to set aside its MND approval and to prepare a full EIR instead.  Farmland Protection Alliance v. County of Yolo (2021) 71 Cal.App.5th 300.  (In the unpublished portion of its opinion, which won’t be further discussed in this post, the Court of Appeal held the trial court was correct in finding that substantial evidence supported a fair argument that the project may have a significant impact on the beetle, thus requiring an EIR, and also concluded the trial court did not err in upholding the County’s determinations that the project was consistent with the Williamson Act and County’s zoning code.)

Relevant Factual and Procedural Background

The County and its Board of Supervisors adopted a revised MND and issued a conditional use permit (CUP) for the project, which proposed operation of “a bed and breakfast and commercial event facility supported by onsite crop production intended to provide visitors with an education in agricultural operations.”  In the ensuing CEQA/land use lawsuit brought by entities interested in the protection and preservation of agricultural land, the trial court found merit in three of the plaintiffs’ CEQA arguments challenging the MND’s adequacy – i.e., that substantial evidence supported a fair argument that the project may have a significant effect on each of the three species of concern mentioned above.  As a remedy, it ordered County to prepare an EIR, but one limited to addressing only the project’s impacts on those species, while allowing the project approval and MND (and its mitigation measures) to remain in effect and also allowing project operations to continue pending compliance with its order.  (Since the County had already filed a return evidencing its compliance with the order through preparation and certification of the “limited EIR” prior to the Court of Appeal’s decision, the Court found moot and did not reach the argument that the portion of the trial court’s order allowing continued project operation during compliance was unlawful, as it could no longer provide any effectual relief on that issue.)

The Court of Appeal’s Opinion

Further factual and procedural details regarding the project or the County’s proceedings are unnecessary to understand the Court of Appeal’s published holding and the bases for it.  Boiled down to the essentials, the Court of Appeal held that neither CEQA nor its interpretive case law authorize a “limited EIR” at the “third tier” of the CEQA review process, nor do they provide any authority for “an order splitting the analysis of a project’s environmental impacts across two types of environmental review documents,” such as the deficient MND and the “limited EIR” ordered by the trial court here.  Rather, once substantial evidence is presented that a project might have a significant environmental impact in any area, a negative declaration is inappropriate and CEQA requires the lead agency to prepare an EIR – in the Court’s parlance, a “full EIR” – for the proposed project.  While the CEQA remedies statute (Pub. Resources Code, § 21168.9) is intended to provide flexibility in facilitating compliance with CEQA, it doesn’t trump CEQA’s mandatory provisions or allow circumvention of “the heart of the Act – the preparation of an environmental impact report for the project.”

As indicated, the Court relied in significant part on CEQA’s “three-tiered” process for lead agencies as confirming this conclusion.  That process is:  (1) conduct preliminary review to determine whether a “project” subject to CEQA exists, and if so whether it is exempt (statutorily or categorically); (2) conduct an initial study to identify potential impacts, and to inform the choice between a negative declaration (ND) (or mitigated negative declaration (MND)) and an EIR, and then prepare an ND if there is no substantial evidence of a potential significant effect (or an MND if project plans are revised to eliminate any such potential effect with certainty); and (3) if it is determined that the project may have a significant environmental effect, prepare a full EIR, which requirement has been described as “the heart of CEQA.”  (Citing Save Our Big Trees v. City of Santa Cruz (2015) 241 Cal.App.4th 694, 704-705; Laurel Heights Improvement Assn. v. Regents of University of California (1993) 6 Cal.4th 1112, 1123.)

The Court observed that it found nothing in CEQA or the case law interpreting it “suggesting a project’s impact analysis may be divided across the second and third tiers of environmental review such that some impacts are analyzed in a mitigated negative declaration and others are analyzed in an environmental impact report.”  Rather, the Court held, “if any aspect of the project triggers preparation of an environmental impact report, a full environmental impact report must be prepared in accordance with the definition of [an EIR in Public Resources Code] section 21061.”  (Citing San Bernardino Valley Audubon Society v. Metropolitan Water Dist. (1999) 71 Cal.App.4th 382, 402 & fn. 11; Muzzy Ranch Co. v. Solano County Airport Land Use Com. (2007) 41 Cal.4th 372, 381.)  In other words, under CEQA’s “three-tiered” process, the choice between adopting a negative declaration (of some type) and preparing an EIR is a binary decision.  Per the Court, “the second and third tiers of environmental review under the Act are mutually exclusive[.]”

The Court also held that Public Resources Code § 21168.9 – CEQA’s remedies statute – does not provide authority to disregard CEQA’s “mandatory three-tier approach” and “split a project’s impact analysis across two types of environmental review documents.”  That statute authorizes “flexibility in fashioning remedies,” involving consideration of equitable principles, to bring agency actions into compliance with CEQA.  But ordering a “limited” EIR to supplement a deficient MND when CEQA requires a full EIR does not achieve compliance.  Even where substantial evidence is found to support only a fair argument that a single aspect of the project may have a significant effect, an EIR for the project is still required in accordance with the CEQA statute and Guidelines.  The Court held that the remedies statute does not give the trial court the power to “circumvent” this “fundamental” CEQA requirement.

Conclusion and Implications

While the term “full EIR,” which is used by the Court throughout its published opinion, is not a term defined by CEQA, I read the opinion to use the term as shorthand for an EIR that is complete and complies with the content requirements of CEQA and the CEQA Guidelines; the Court meant to pointedly distinguish such an EIR from the “limited” EIR contemplated by the trial court’s order, an unauthorized CEQA document that would not so comply and which would have to be considered together with an MND prepared for the same project to provide a purportedly complete and adequate environmental analysis.  The cases cited by the Court that used the term (“full EIR”) generally did so in contexts where it was meant to emphasize CEQA’s EIR requirement and to sharply distinguish it from situations where an exemption or ND would be appropriate; none of the cases dealt with the exact issue involved here, i.e., a court essentially authorizing a hybrid document – part MND/part EIR – as sufficient CEQA compliance for a project.

The clearest cited support for the Court’s rejection of the type of “limited EIR” ostensibly ordered by the trial court here is found in San Bernardino Valley Audubon Society, supra, 21 Cal.App.4th 382, a case holding that an EIR was required for a complex mitigation bank project that was intended to provide mitigation credits for future projects both within and outside the project’s vicinity that would adversely impact endangered species and their habitats.  After finding that the project challengers had raised a number of fair arguments, supported by substantial evidence, of specific potential adverse environmental impacts, that court stated, in footnote 11 at page 402 of its opinion:  “By limiting our discussion to the specific aspects of the Project which were challenged by Audubon, we do not mean to suggest than an EIR can or should be limited to, or focused on, those aspects.  To the contrary, a full EIR should be prepared in accordance with the definition in section 21061.”  (Citation to CEQA CEB treatise omitted.)

Of course, what a “full,” i.e., statutorily compliant, EIR will contain may well vary with the project and the circumstances, but the key takeaway is that its contents may not be limited solely to analyses of the potential impact (or impacts) as to which a fair argument has been made to compel its preparation.  Lest too much be read into the instant opinion’s statements regarding a “full EIR,” it bears emphasis that I do not read the Court of Appeal opinion’s references to a “full EIR” to cast any doubt upon commonly used and well-established practices and procedures for streamlining and narrowing the scope and analytic content of EIRs.  Such practices include, but are not limited to:  using an initial study to “scope out” issues and thus “narrow” the EIR’s scope (CEQA Guidelines, § 15006(d)); relying on an earlier EIR or MND to the extent that such a document has already adequately analyzed certain effects (§ 15063(b)(1)(C)); focusing EIR discussions on significant effects in proportion to the impacts’ severity, while limiting discussion of other impacts to a brief explanation of why they are not potentially significant, or omitting discussion of effects dismissed in the initial study as “clearly insignificant and unlikely to occur” (preferably while attaching a copy of the initial study to the EIR to document the basis for so limiting the discussion of environmental effects) (Pub. Resources Code, § 21002.1(e); CEQA Guidelines,§§ 15128, 15143); incorporating by reference portions of prior valid CEQA documents; or using a “Focused EIR” when the stringent statutory requirements for such a document are met.  The opinion did not address, nor do I read anything in it that would affect, such practices.  I do, however, read the opinion to state – unequivocally – that it is improper for an agency to prepare both a negative declaration (of any type) and an EIR as purported CEQA compliance for its approval of a single project, and that any EIR may not be truncated and must fully comply with all applicable statutory and CEQA Guidelines requirements.  With the many substantive and procedural differences between NDs and EIRs, it is not difficult to envision the problems and mischief that would arise were the law otherwise.

Whether this should be the law, and whether these legal requirements should exist – i.e., whether they are wise legislative policy choices – poses different issues altogether.  Preparation of an EIR is inherently more expensive, time-consuming, and burdensome than preparation of an ND or MND.  Some have questioned the wisdom and utility of a rule requiring a “full EIR” for a project with only very limited potentially significant impacts.  But it is a court’s job to apply the law as it exists, not to rewrite it.  I find no fault with Justice Robie’s opinion, which, in my view, accurately captures CEQA’s EIR requirement as it is currently structured and as it has been consistently interpreted by the courts.

But that is not to say that it must always remain so.  To invoke the words of the late Robert F. Kennedy, in the current context of widespread acknowledgment of CEQA litigation abuse and the need for CEQA reform:  “Some men see things as they are and say, why; I dream things that never were and say, why not.”  The Legislature has shown itself capable of creating more streamlined CEQA documents, falling outside of the traditional and established binary choice (between an ND/MND or an EIR) highlighted by the Court’s opinion, when it serves policy objectives deemed important and desirable.  (See, e.g., Pub. Resources Code, § 21155.2(b) [2008 legislation creating option of “sustainable communities environmental assessment” or “SCEA” for streamlined review of certain GHG-reducing projects, as discussed in my July 19, 2019 post].)  A streamlined or limited EIR (or other CEQA document) for some (or even all) types of projects that present only very few or limited potentially significant environmental effects, while not currently authorized by CEQA, is certainly a possibility.

And, why not?  It is clearly not beyond the realm of legislative reform.  (See Saltonstall v. City of Sacramento (3d Dist. 2014) 231 Cal.App.4th 837, 854 [observing “no matter how important its original purpose, CEQA remains a legislative act, subject to legislative limitation and amendment … and the Legislature constitutionally may eliminate any of its requirements.”].)  And so, while Justice Robie got the law right, and while the trial judge here undoubtedly got “out of her lane” in making her unauthorized remedial order, perhaps – in some ways – she was also ahead of her time.  Something to ponder.


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