This article, authored by Michael Shonafelt, was originally published by Law360 on April 10, 2018

On Feb. 5, 2018, the Sixth Appellate District of the California Court of Appeal issued a crucial ruling concerning California Environmental Quality Act review for wireless telecommunications facilities in the public rights-of-way. The case, Aptos Residents Association v. County of Santa Cruz,[1] clarifies that so called “small cell” telecommunications networks in the public streets and highways are exempt from CEQA review under the “Class 3” categorical exemption, which, among other things, applies to “limited numbers of new, small facilities or structures,” such as “[w]ater main, sewage, electrical, gas, and other utility extensions…”[2]

The Facts

The project involved installation of small antennas (or “microcells”) and radios on existing utility poles. The appellant, Aptos Residents Association (“Aptos”), an association of area residents organized to oppose the project, contended that the facilities constituted a “health hazard” and created aesthetic blight. Aptos further argued that the purported aesthetic impacts were sufficient to override a Class 3 exemption and therefore require CEQA review. The county disagreed, noting that the network was “relatively visually inconspicuous” and “created no visual impact, either individually or cumulatively.” At each stage of the county’s administrative appeal process, the county affirmed the Class 3 exemption. After the board of supervisors declined to take Aptos’s final administrative appeal, Aptos brought a lawsuit challenging the county’s determination.

To advance its arguments, Aptos relied on certain “exceptions” to the Class 3 exemption, arguing that the county abused its discretion by (1) failing to consider the aesthetic impacts of the entire project and instead improperly segmenting the project by considering each of the 11 microcells individually; (2) failing to consider information submitted by Aptos that AT&T was interested in putting cell transmitters in the Day Valley area and finding that the “cumulative impact” exception did not apply; (3) finding that the “location” exception did not apply, and (4) finding that the “unusual circumstances” exception did not apply. The trial court rejected each of contention and affirmed the county’s decision.

The Court’s Decision

The Court of Appeal affirmed. It observed that the Class 3 exemption applies to “limited numbers” of “small structures,” and that it is “clearly not limited to a single small structure. Each microcell consisted of a two-foot by one-foot antenna mounted to an extension on the utility pole. The structure was no more than six feet in length along with pole-mounted equipment to support it. The court also noted that each microcell unit was a utility extension, which the Class 3 exemption explicitly included. 

The court then turned to the question of whether any “exception” applied to displace the Class 3 exemption, noting that “where an exception is predicated on a factual issue, we apply a traditional substantial evidence standard of judicial review to that factual issue.”

For the “cumulative impacts” exception, the court determined that substantial evidence supported the county’s conclusion that the project would not give rise to cumulative aesthetic impacts. It found that Aptos’s information about the cumulative effects of future AT&T projects in the area amounted to nothing but speculation. The court similarly dispatched Aptos’s “location exception” theory. The location exception applies only to projects that “may impact on an environmental resource of hazardous or critical concern where designated, precisely mapped and officially adopted pursuant to law by federal, state, or local agencies.”[3] In this case, the mere fact that the Day Valley community was zoned “Residential Agricultural” did not qualify as an “environmental resource of hazardous or critical concern.” Finally, for the unusual circumstances exception, the court determined that it was not sufficiently “unusual” to locate small cell telephone facilities in agricultural/residential zones, noting “[a]reas that are used for residential and agricultural purposes clearly need utilities, including cell coverage. It is not unusual that such services are provided by small structures.”

Conclusion

The case highlights the propriety of Class 3 CEQA exemptions for critical wireless telecommunications and broadband infrastructure in the state of California. The First Appellate District Court of Appeal had earlier held that a network like Crown Castle’s microcell network was subject to the Class 3 CEQA exemption in the urban setting of San Francisco.[4] The Aptos Residents Association case establishes that the exemption also applies in a rural setting, where aesthetic impacts may be more heightened. Aptos Residents Association also establishes that that “substantial evidence” standard of review applies when a court is required to determine whether or not the “location” or “cumulative impacts” exceptions defeat a Class 3 CEQA exemption. Finally, the case demonstrates the application of the California Supreme Court’s recent articulation of the bifurcated standard of review for the “unusual circumstances” exception in Berkeley Hillside Preservation v. City of Berkeley.[5]

The case comes at a critical time for the wireless telecommunications industry. Small cell networks in the public streets and highways are becoming the sine qua non for the nation’s broadband network, which must continually expand to keep pace with exponential growth in the use of mobile devices and mobile applications. As recently as ten years ago, larger “macro-sites” or towers provided service for voice communications over cell phones. With the blistering pace of 4G and 5G technologies, however, the legacy macro-sites and cell phone towers are woefully inadequate to deliver sufficient bandwidth to users. Americans’ voracious appetite for mobile data puts continual pressure on the industry to deploy networks rapidly. The question of whether and how such networks must comply with CEQA review has loomed, not just for the industry, but also for the local governments charged with issuing permits for the networks.

Trends in the use of wireless telecommunications devices are being tracked by the U.S. Department of Health and Human Services. According to that agency, over 50 percent of all American homes are now wireless only. Global mobile data traffic is expected to reach a sevenfold increase by 2021. As use of mobile smart phones and tablets proliferates, and dependency on such technologies grows, the telecommunications industry and local governments alike need certainty on the applicability of CEQA exemptions for the vital communications infrastructure, whether such networks exist in rural or urban settings. Aptos Residents Association v. County of Santa Cruz advances that level of certainty.