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Friends of Outlet Creek v. Mendocino County Air Quality Management District

California Court of Appeals, First District, First Division

May 25, 2017

FRIENDS OF OUTLET CREEK, Plaintiff and Appellant,
MENDOCINO COUNTY AIR QUALITY MANAGEMENT DISTRICT et al., Defendants and Respondents, GRIST CREEK AGGREGATES, LLC, et al., Real Parties in Interest.

          Filed March 23, 2017

         Trial Court: Mendocino County Superior Court No. SCUK-CVPT-15-66445 Trial Judge: Hon. Jeanine Nadel

          Greenfire Law, PC, Rachel S. Doughty for Plaintiff and Appellant.

          Terry N. Gross, Esq.; Office of the County Counsel for Mendocino County, Katharine L. Elliottand Michael John Makdisi; Law Offices of Rapport and Marston, David Joseph Rapport for Defendants and Respondents.

          Harrison, Temblador, Hungerford & Johnson LLP, Adam K. Guernsey and Mark D. Harrison for Real Parties in Interest and Respondent.

          Humes, P. J.

         This is one of several lawsuits Friends of Outlet Creek (Friends) is pursuing in an effort to prevent asphalt production at the site of an aggregate operation. The Mendocino County Air Quality Management District (District) and Grist Creek Aggregates, LLC (Grist Creek) successfully demurred on the ground Friends can only proceed against the District in an administrative mandamus proceeding under Health and Safety Code section 40864, which the District and Grist contend cannot embrace a challenge under the California Environmental Protection Act (CEQA). Friends, in turn, has expressly disclaimed any reliance on Health and Safety Code section 40864 and asserts it can sue the District directly under CEQA. The trial court sustained the District's and Grist's demurrer, and dismissed the action.

         We reverse, as there is established precedent allowing CEQA claims against air quality management districts. However, that does not mean Friends can challenge any land use designations or authorizations pertaining to the site that have been made by the County of Mendocino(County). The only action taken by the District (a separate and independent governmental agency) in connection with the land use dispute here, is an assessment of the proposed asphalt production's impact on air quality and issuance of an “Authority to Construct”-and that is the only action Friends can challenge in this lawsuit. Further, even under CEQA, this is an administrative mandamus proceeding governed by Code of Civil Procedure section 1094.5. Accordingly, the only relief Friends can obtain through this lawsuit against the District is invalidation of the Authority to Construct.


         Since 1972, the County has granted land use approvals for aggregate and asphalt production on the site at issue.[1] The County approved one such use permit in 2002, and in doing so, conducted environmental review under CEQA. The County ultimately issued a mitigated negative declaration.[2]

         Seven years later, in 2009, the County updated its General Plan, changing the land use designation of the site from Rangeland to Industrial. In doing so, the County proceeded under CEQA and prepared an environmental impact report (EIR). The following year, in 2010, the County, consistent with its updated General Plan, rezoned 61 parcels, including the site at issue, to conform to the updated use designations. In doing so, the County relied on its previously certified EIR. According to County planning staff the “approved zoning change thus allows, by right, industrial uses that were previously considered to be non-conforming and subject to discretionary land use entitlements.” There was no judicial challenge to either the General Plan update or the rezoning.

         After Grist Creek acquired the site, it applied to the County for Development Review of its proposed continuation and resumption of aggregate and asphalt production at the site. The Mendocino County Planning Department's staff report for the review stated there had been little asphalt production primarily due to market conditions and over the years much of the asphalt processing equipment had been removed. It further stated that due to environmental impacts that could result from asphalt production, Grist had opted to proceed for the time being only with an aggregate and concrete operation. The Planning Department undertook an environmental review under CEQA and, ultimately, the County adopted a negative declaration subject to two dozen conditions in mitigation. The Air Quality Management District was listed as a referral agency that had provided comments to the County.

         In late 2014, the County Planning Department and Grist Creek again discussed the production of asphalt, and in March 2015, the matter was presented directly to the County Board of Supervisors by way of an “Operational Statement” that asked the board to decide whether the proposed resumption of asphalt production at the site would be a “new or changed” industrial use under the County's zoning ordinance.[3] The board, by way of a March 2015 resolution, declared the proposed use was neither a new, nor a changed, industrial use. Three days later, the County Planning Department issued a “Notice of Exemption” for the “[r]esumption of activity at the... aggregate processing plant, ” specifying the County as the “Public Agency Approving Project.” Friends promptly filed a lawsuit against the County challenging this resolution.

         Having obtained approval of asphalt production from the County, Grist applied to the District for an Authority to Construct.[4] As part of the review, the District's air pollution control officer issued a report stating, among other things, that use of the site by two previous owners for “aggregate processing, concrete, as well as a hot mix asphalt plant and concrete batch plant, ... led to the determination by the lead Planning agency that a new [E]nvironmental Impact Review (EIR) was not required.” Without further discussion, the report concluded the proposed asphalt facility was “a project or a portion of a project for which another public agency has already acted as the lead agency in compliance with CEQA.” Given that determination, the air pollution control officer concluded no further environmental review by the District was required. The bulk of the report discussed emissions related to the proposed use and concluded the proposed use would “not result in a significant net increase in emissions of any air contaminant regulated under the Clean Air Act[5] Amendments of 1990 and as amended at the time of the application.” In June 2015, the officer issued an Authority to Construct.

         Later in the same month, the County Board of Supervisors adopted a second resolution. Expressly stating it wished to avoid protracted and expensive litigation under CEQA, the board of supervisors rescinded its March 2015 resolution. The new, June 16, 2015, resolution also expressly stated it did not impact any land use entitlements or authorizations that existed in connection with the site prior to the March 2015 resolution. Friends then filed an amended pleading in its lawsuit against the County. The County, in turn, successfully demurred on the ground the lawsuit was moot, given that the March 2015 resolution Friends was challenging had been rescinded. Friends appealed, and that appeal (No. A147499) now rests with another Division of this court.

         In the meantime, a month after the District's air pollution control officer approved an Authority to Construct, Friends, in July 2015, filed an administrative appeal to the District's hearing board. During these proceedings, the District presented the following in support of the air pollution control officer's determination that the District did not need to conduct further environmental review: (1) the County's 2009 EIR done in connection with updating its General Plan; (2) the County's approval of the General Plan changes; (3) the County's rezoning of the site to Industrial; and (4) the 2002 mitigated negative declaration adopted by the County and the prior use permit issued by the County authorizing an asphalt plant at the site. The hearing board denied Friends' appeal in early September in a written decision, setting forth its findings and the evidence supporting them.

         Friends then filed the instant lawsuit against the District, its hearing board and the air pollution control officer who issued the District's report and the Authority to Construct. The first cause of action alleged that the District failed to comply with CEQA by acting without a new environmental impact analysis. The second cause of action alleged the District did not follow its own regulations, including Mendocino County Air Quality Management District Regulation 1, Appendix A, section XIV (Regulations), requiring it to certify that it has reviewed and considered a lead agency's EIR or negative declaration when approving a project without conducting its own CEQA process.

         The District and Grist demurred to both causes of action on the ground Friends cannot sue the District directly under CEQA, but, instead, can only sue it under Health and Safety Code section 40864, which they maintain cannot be used to make a CEQA challenge. The trial court agreed and sustained the demurrers. Although granted leave to ...

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