The California Environmental Quality Act, Public Resources Code sections 21000, et seq., ("CEQA") requires that an environmental assessment be performed before a government agency acts on certain qualifying projects. A recently published opinion from the California 2nd District Court of Appeal shows how powerful CEQA is and illustrates that the act can be invoked to require a full Environmental Impact Report ("EIR") be performed prior to the government acting.

On Jan. 27, 2010, California’s 2nd Appellate District issued a ruling requiring the city of Manhattan Beach, Calif., (the "City") to prepare an EIR prior to enacting a City ordinance banning the distribution of plastic bags from certain retail and restaurant establishments. This case should serve as a reminder to project developers of how far CEQA can reach, and how low the bar is for a plaintiff to claim that an agency must perform an EIR before acting.

In Save the Plastic Bag Coalition v. City of Manhattan Beach, 2010 WL 298001 (Cal.App. 2 Dist.), the Court of Appeal affirmed the trial court’s issuance of a peremptory writ of mandate which invalidated the Negative Declaration the City had prepared and vacated its ordinance, until after a full EIR was prepared to analyze the potential impacts of the proposed ordinance.

The Court of Appeal agreed that the plaintiff in the case, an association of plastic bag manufacturers, had succeeded in making a fair argument that the ordinance may cause increased use of paper bags which may have a significant negative impact on the environment. Therefore, an EIR was required to help the City make an informed decision about the ordinance.

The case highlights two issues under CEQA:

Low bar to establish standing

First, there is a low bar for a plaintiff to establish standing to bring a CEQA claim. Here, the plaintiff was an association of plastic bag manufacturers that formed to respond to the misinformation, myths and exaggerations that the association said had been disseminated about the environmental impacts of plastic bag use. The plaintiff association claimed it had a public interest in the need for an EIR which "addresses pollution, greenhouse gas emissions and the other negative impacts resulting from paper bag use."

This argument prevailed at the trial court and was upheld on appeal. The Appellate Court explicitly stated this was not a case in which the plaintiff’s interest was purely commercial and competitive. Further, it found the statewide concern for maintaining a quality environment established a public right and duty at stake in the case. It is likely that this public right/duty argument could be advanced by nearly any plaintiff at nearly any time.

Low bar to require full EIR before agency acts

Second, there is a low bar for a plaintiff to establish that a full EIR should be performed before an agency acts. When there is substantial evidence, in light of the record as a whole, that a fair argument can be made that a project may have a significant environmental impact, an EIR must be prepared. In other words, when it can be fairly argued that there may be a significant environmental impact, even if the overall effect of a project is beneficial, then the agency must prepare an EIR to assess the impacts before making a decision.

Here, the plaintiff offered four studies that had been conducted, each one concluding that the increase in the use of paper bags, in place of plastic bags, would have a negative effect on some aspects of the environment, such as an increase in nonrenewable energy and water consumption, greenhouse gas emissions, solid waste production or acid rain.

The requirement to perform an EIR does not mean the ordinance cannot be passed after the EIR has been certified, and the opinion refers to this fact. It just means that the potential environmental impacts must be assessed before passage so the agency and the public can be informed about the effect on the environment, and possibly minimize or mitigate some impacts. The court found that performing an EIR will ensure the agency makes an informed decision.

Conclusion

Project proponents should view the Save the Plastic Bag Coalition case as a reminder that a California court may direct that an EIR be performed (based on broad grounds for standing and the fair argument test) and used as an informative tool. Even if the agency is acting with the purpose of an overall benefit to the environment, it must adhere to the CEQA process and be mindful of the low thresholds contained in the statutory requirements and judicial interpretations of that process.