Park District Need Not Comply with CEQA Prior to Taking Private Property

A local government agency may start the process for condemning private property without first complying with the California Environmental Quality Act (“CEQA”), a California appellate court has held. Golden Gate Land Holdings, LLC v. East Bay Regional Park District (1st Dist. 2013).

The East Bay Park District (the “District”) proposed to take 2.88 acres of private property in fee title and a 4.88 acre perpetual, non-exclusive easement “. . . in order to construct, operate, and maintain a recreational trail . . . to be used by the general public for hiking, bicycling and equestrian use and other related uses.” The District authorized its special counsel to commence the proceedings necessary to acquire the property in the District’s name. The District filed a notice of exemption under CEQA stating that the District “has approved this project and found it to be exempt from CEQA.” The notice of exemption provided: “The subject parcels are being acquired for the purpose of open space protection and future public access.” As for the stated reasons why the project was exempt from CEQA: “This project consists of the acquisition of land in order to protect open space and to secure future public access to [Eastshore Park] and the . . . Bay Trail. . . . Any development of this property and land use changes would be subject to future CEQA review.”

The property owner filed a court action, asserting that the District had violated CEQA and the eminent domain law. The trial court found that the District had approved a CEQA “project” — which consisted of both the proposed acquisition and the proposed trail improvements. For CEQA purposes, addressing the two parts separately would be improper piecemealing of the project, the court reasoned. The proposed improvements are sufficiently definite given the District considered three options for a trail site, selected one, has a design and price estimate for the improvements, and is now initiating the condominium proceeding. Nevertheless, the court determined that a public agency is permitted to initiate condemnation proceedings with “actual acquisition” conditioned on CEQA compliance. As a result, the court allowed the District to proceed with its eminent domain action before complying with CEQA, requiring the District to vacate only that portion of its resolution that provided that the project was exempt from CEQA.

The court of appeal turned quickly to the essential question: “when an EIR must be prepared in a case where CEQA and eminent domain law intersect.” Some California authorities suggest that CEQA review must be completed before a condemnation proceeding is started. However, the appellate court declined to follow those authorities. Instead, the appellate court held that a trial court did not have to vacate the entire resolution of necessity (a first step in an eminent domain proceeding) but could order a lesser remedy and vacate only a part of the District’s action. The appellate court relied on state statutes and equitable principles to give the trial court flexibility to fashion an appropriate remedy. Also, the court found “no evidence that, by continuing its eminent domain proceedings, the District was going to be prejudiced in its ‘consideration or implementation of particular mitigation measures or alternatives to the [proposed improvements].”

The District dodged a bullet in this case. When the appellate court agreed with the trial court that the District did not comply with CEQA, it should have been “game over” — particularly when the trial court found that the acquisition of the property was part of the CEQA “project”! Even so, court of appeal held that the condemnation proceeding could continue. In my view, once the case was framed as whether a trial court had power and authority to fashion a narrowly tailored remedy, the property owner had an uphill battle. Courts are generally reluctant to limit their powers, particularly when the power that is being limited is one that allows a trial court to fashion a remedy that looks like judicial restraint. Nevertheless, CEQA played a big role in this case and it is a warning to local governments. Counsel for landowners will argue that this case continues the trend: public agencies must comply with CEQA before fully implementing a public project, even one that may have an “environmental benefit” like a park or trail. Counsel for local governments may be tempted to see this case as providing an “escape hatch” in litigation, arguing that a court can fashion a narrowly tailored remedy that allows “a portion of the action” to move forward while the local government complies with CEQA on an after-the-fact basis. Of course, CEQA requires analysis of “the whole of an action” and defines a “project” in that manner. When the “portion of an action” is something other than the eminent domain power and its well-developed statutory procedures and rich history in the case law, CEQA may very well require a different result.