In an opinion filed September 10, and later ordered partially published on October 9, 2015, the Court of Appeal affirmed the substance of a judgment upholding an EIR for a regional shopping center renovation project in Carlsbad, California, reversing only with respect to certain cost award issues treated in an unpublished portion of the opinion. North County Advocates v. City of Carlsbad (Plaza Camino Real, LP, et al., Real Parties in Interest) (4th Dist., Div. 1, 2015) ____ Cal.App.4th ______, 2015 WL 5895477. The published portions of the opinion address the case’s facts, applicable CEQA rules and standards of review, and traffic baseline issues; the unpublished portions address issues concerning traffic mitigation measures, the adequacy of the City of Carlsbad’s (“City”) responses to comments, and the propriety of the various aspects of the trial court’s record preparation cost awards that were made to the City and real parties (“Westfield”) as prevailing parties.

The project at issue was the City’s approval of a Specific Plan and a Site Development Plan for renovation of a large regional shopping center originally built in 1969. The project included the demolition and reconstruction of a 148,159 square foot building that formerly housed a Robinsons-May store; the building was fully occupied for more than 30 years until vacated by Robinsons-May in 2006, but has had a lesser and fluctuating occupancy by various retail users since that time. Apart from actual use, Westfield had the right under a 1977 Precise Plan to renovate and fully occupy the building without need of any further discretionary approvals from the City.

Project opponents’ primary challenge was to the traffic baseline that the City determined to use in its EIR. That baseline augmented actual traffic counts with traffic volumes based on afully occupied Robinsons-May building using trip generation rates and estimates for a “Super Regional Shopping Center” land use taken from a 2002 SANDAG publication. Using a baseline with this “imputed” traffic, the City’s traffic analysis concluded the project would have no significant impacts at analyzed intersections or street segments, including on a bridge across SR-78 which the neighboring City of Oceanside wanted to have widened while compelling the City to pay part of the costs.

The Court of Appeal affirmed the trial court’s judgment upholding the EIR in all respects – including City’s use of the augmented traffic baseline as being supported by substantial evidence, with the Court rejecting petitioner’s contentions that the baseline was “incorrect and misleading.” The Court distinguished Communities for a Better Environment v. South Coast Air Quality Management Dist. (2010) 48 Cal.4th 310 (“CBE”) and found Cherry Valley Pass Acres & Neighbors v. City of Beaumont (2010) 190 Cal.App.4th 316 (“Cherry Valley”) to be “on point and persuasive” on the baseline issue. While CBE held the air “district’s selected baseline was impermissibly “hypothetical” because it was based on maximum permitted operating conditions that were “not the norm” “(CBE at 322), it also recognized there is no “uniform, inflexible rule” and agencies have discretion to devise a baseline that accommodates fluctuating operating conditions as long as it is supported by substantial evidence. (Id. at 327-328; also citing Save Our Peninsula Committee v. Monterey County Board of Supervisors(2001) 87 Cal.App.4th 99, 125 [“Environmental conditions may vary from year to year and in some cases it is necessary to consider conditions over a range of time periods.”].)

Cherry Valley involved the evaluation of a project’s impacts on an overdrafted groundwater basin. It upheld a city’s discretionary baseline determination, in a context of fluctuating historical water use at the project site, based on both a legal entitlement to extract 1,484 acre-feet annually of groundwater, and a recent history of actual extraction of substantially that amount. (Cherry Valley, at 340.) Following Cherry Valley’s reasoning, the Court found City’s traffic baseline proper and supported by substantial evidence. Per the Court:

… the City’s … traffic baseline that assumed full occupancy of the Robinsons-May space was not merely hypothetical because it was not based solely on Westfield’s entitlement to reoccupy the … building “at any time without discretionary action,” but was also based on the actual historical operation of the space at full occupancy for more than 30 years up until 2006. … . [¶] The City’s decision to base the traffic baseline on historical occupancy rates is further supported by substantial evidence consisting of SANDAG data on such use levels. [¶] Therefore, we conclude substantial evidence supports the City’s exercise of discretion in selecting a traffic baseline that assumed a fully occupied Robinsons-May building.

The unpublished portions of the opinion dealing with the adequacy of mitigation and responses to comments are not particularly noteworthy – due to the clear lack of merit of Petitioner’s arguments in these areas, the Court’s holdings were not “close calls.” However, the opinion’s 8-page concluding section dealing with the trial court’s various rulings awarding administrative record preparation costs to the City – despite Petitioner’s election to prepare the record – probably should have been published as it contains a clear and helpful distillation and summary of the rules in this area as established by recent case law, particularly the decisions in Coalition for Adequate Review v. City and County of San Francisco (2014) 229 Cal.App.4th 1043 and St. Vincent’s School for Boys, Catholic Charities CYO v. City of San Raphael (2008) 161 Cal.App.4th 989. Counsel dealing with such issues would be well advised to read this part of the opinion as a primer even though it can’t be cited.

What is the case’s key “takeaway” on the baseline issue? “Existing conditions” are not always static, so it’s not necessarily about what actually exists at the time environmental review commences. Lead agencies commonly deal with “fluctuating” environmental conditions – such as, for example, traffic, water use, air emissions or noise – and they retain considerablediscretion (subject to review under the deferential “substantial evidence” standard) in determining the appropriate “baseline” against which to measure a project’s environmental impacts in such areas. This case illustrates that lead agencies are not compelled to select a frozen-in-time “snapshot” of the most recent conditions when substantial evidence of factors such as longstanding historical use, legal entitlement, and reasonable projections make the use of another baseline a reasonably accurate representation of “real” conditions obtaining at the project site and not merely “hypothetical” ones.