(May 27, 2020) A job killer bill that will impede housing construction and harm California’s economic recovery will be considered by the Senate Environmental Quality Committee on Friday.

SB 950 (Jackson; D-Santa Barbara) would expand the California Environmental Quality Act’s (CEQA) existing requirements by adding costly new mandates that will burden local agencies, add substantial time and costs to the CEQA process and provide project opponents with new legal arguments to delay or block housing and other projects.

Housing construction has been devastated by COVID-19. A new economic report from the U.S. States Commerce Department reveals that housing construction collapsed by 22.3% in March. The state Department of Finance recently forecasted that permits for new housing construction will drop by more than 21% this year. These grim figures represent the worst drop in housing construction activity since March 1984.

At a time when California is reeling from the impacts of the COVID-19 global pandemic and struggling with an existing housing crisis, SB 950 attempts to make major changes to CEQA, the Elections Code and the California Code of Civil Procedure that will harm California’s economic recovery, place substantial cost pressures on local governments, substantially degrade the state’s ability to build more housing and negatively impact jobs in or related to the construction industry.

Costly, Time-Consuming Requirements

SB 950 proposes amendments to Public Resources Code Section 21083.03 that would require the Office of Planning and Research (OPR) to develop new translation requirements for all CEQA “notices and other documents” into one or more nonEnglish languages spoken by a substantial number of people served by the lead agency. The bill enumerates a non-exhaustive list of documents lead agencies would be required to translate and provides OPR with authority to develop translation requirements for any other CEQA document.  Should OPR include environmental impact reports (EIR), mitigated negative declarations (MND) and technical appendices, lead agencies would be required to translate hundreds or even thousands of pages of CEQA documents into other nonEnglish languages.

In addition to the time and costs associated with translating CEQA documents, SB 950 also provides project opponents with new legal arguments to challenge housing and other projects on the basis that the documents were not translated accurately. Project opponents can exploit the difficulty in translating CEQA documents into other languages where five decades of CEQA case law is entirely in English and technical terms of art may not necessarily translate well into other languages. The practical result will be that lead agencies will have the almost impossible task of translating CEQA documents into multiple other non-English languages without any errors or else risk invalidation of the project approvals.

Reduces Citizen Access to the Ballot

SB 950 would substantially reduce citizen participation and access to the ballot by changing California Election Code so that voter-sponsored initiatives cannot be approved by a legislative body. In doing so, the bill overturns a seminal California Supreme Court decision with implications beyond housing and CEQA. The change to Election Code could subject just about any new initiative to CEQA review and likely protracted CEQA litigation.

More CEQA Litigation by Revising CEQA’s Original Legislative Findings

SB 950 would change CEQA’s original Legislative findings to explicitly include the consideration of environmental justice. Rewriting the original intent language to inject the issue of discriminatory land use policies into an environmental statute that was never intended to deal with this issue invites more CEQA litigation. CEQA requires project applicants to analyze all identifiable and tangible environmental impacts associated with proposed land use projects and to mitigate any potentially significant impacts from the project to less than significant. Discriminatory land use policies should be addressed through planning and zoning policies rather CEQA which looks to mitigate quantifiable environmental impacts associated with a particular project.

Second Public Comment Period Fails to Address ‘Late Hit’ Letters

SB 950 attempts to address a common tactic under CEQA whereby lead agencies are bombarded with extensive written comments and expert reports on or shortly before the day of the final hearing for a project approval.  “Late hit” comment letters abuse the CEQA process by allowing project opponents to inject extensive written comments, expert reports, and other evidence into the administrative record as late as the final day of the hearing. By submitting their comments on or just before the final day of the hearing, project opponents prevent lead agencies from being able to meaningfully consider the comments and change any aspects of the project in light of the feedback received.

Unfortunately, SB 950 does nothing to protect lead agencies from “late hit” comments that abuse the CEQA process. The proposed second comment period only attempts to address issue preclusion, but leaves an obvious workaround that allows the project opponent to simply attend the final hearing and exhaust all issues orally. Worse, a second comment period could have the unintended consequence of incentivizing project opponents to hold their comments during the first comment period and ambush the unexpecting lead agency during the second comment period where the project opponents have the advantage of seeing all of the agency’s responses to other public comments. But most importantly, SB 950 fails to address the heart of the problem with “late hit” letters. As noted above, project opponents utilize the late hit comment strategy in order to ensure all of their comments and expert reports are included in the administrative record without agency rebuttals and without allowing the lead agency to address any of the issues they raise. Meaningful CEQA reform around the “late hit” comment issue would instead focus on excluding “late hit” comments from the administrative record altogether.

Encourages More Lawsuits Against Moderate-Income Housing

SB 950 proposes to substantially amend California Code of Civil Procedure Section 529 by eliminating moderate-income housing projects from qualifying for bond protection. Under existing law, a court may require persons suing to halt low- or moderate-income housing projects to post a bond for any costs and damages that the defendant may incur as a result of delay in carrying out the project. A plaintiff loses that bond if the defendant shows that the action was brought in bad faith for the purpose of delaying or impeding development of low- or moderate-income housing. This public policy can help to discourage frivolous lawsuits aimed at thwarting low- or moderate-income housing projects. SB 950 would provide project opponents of moderate-income housing projects with carte blanche to sue to delay or halt without any fear of having to pay attorney costs or damages incurred by a housing developer whose project was unjustly delayed or halted.

Even during the best of times, these proposed changes would damage California’s economy, substantially slow the state’s housing production and negatively impact jobs all across the state. During these extraordinary times, substantially raising the costs, time and litigation risks associated with land use development in California will be a crushing blow to the state’s efforts to bring more affordable housing online and rebound from the economic impacts of the COVID-19 pandemic.

Staff Contact: Adam Regele