Pursuant to the California Environmental Quality Act (CEQA), Environmental Impact Reports (EIRs) are often required to analyze the environmental impact a project may have on the environment, as well as ways to minimize or mitigate the environmental impact of the project. In Protect Niles et al. v. City of Fremont et al.the First District Court of Appeal analyzed whether an EIR was required for a project located in Niles Historic Overlay District in Fremont, California. [Protect Niles et al. v. City of Fremont et al., ___Cal.App.5th___, Case No. A151645 (1st Dist. Aug. 9, 2018).]

 Factual and Procedural Background

The City of Fremont (City) has designated certain areas of Niles as the Niles Historic Overlay District (HOD) and has adopted certain design guidelines and regulations for commercial projects in this area. The City approved a commercial and residential project located within the Niles Historic Overlay District despite neighborhood protest.

The proposed project consisted of 85 residential townhomes in the southern portion of the site and mixed residential and retail in the northern portion of the site. The developers (Valley Oak) claimed that their vision for the project was to establish an:

• . . .iconic development that enhances the historic character of the Niles town center, the sense of arrival to Alameda Creek Trail, and most importantly, the reinforcement of the vitality and eclectic nature of the Niles community.

Following an Initial Study, the City planning staff prepared a draft Mitigated Negative Declaration (MND) instead of an EIR. The MND draft found that the project would not significantly impact (with or without mitigation) the aesthetics or the traffic in the HOD.

The draft MND was then submitted to the City’s historical architectural review board (HARB) for review. At a January 2015 HARB hearing, several Niles residents argued that the project was inconsistent with the HOD. Specifically, the residents objected to the height of the buildings, the density of the townhouse area, the architectural style of the buildings and the choice of colors and materials on the building exteriors. The residents also objected to the generation of traffic and parking issues. The HARB denied the project because it would be incompatible in terms of siting, massing, scale, size, materials, textures and colors with the existing development in the Niles HOD.

The project and draft MND was then referred to the planning commission, which ultimately adopted the draft MND subject to conditions including height reduction of some townhouses, ensuring high windows did not provide views into adjacent homes, reduced use of metal siding and improved traffic flow at the New Street/Niles intersection with a turnaround.

Residents continued to object to the project at the March 3, 2015 city council meeting. Nevertheless, the council approved the project and adopted the draft MND. The City issued a Notice of Determination finding the project as mitigated would not have a significant effect on the environment and would be functionally and aesthetically compatible with the buildings styles, materials, colors and significant feature of the Niles HOD. One condition of the approval required that the applicant deal with the traffic issue by working with the Public Works Department. As approved, the project still included 98 residential units.

Protect Niles petitioned for a writ of mandamusordering the City to set aside the project approvals and prepare an EIR because substantial evidence supported a fair argument of significant aesthetic/land use impacts, traffic impacts, hazardous materials impacts and impacts on the Alameda Creek Regional Trail.

The trial court found substantial evidence supported a fair argument of significant impacts on aesthetics and traffic only and ordered the City to vacate its project approvals and refrain from approving the project absent compliance with the CEQA in the preparation of an EIR. Valley Oak appealed.

The Court of Appeal’s Decision

The court began its analysis with discussion on CEQA. The court cited to §§ 21100, 21151 and 21082.2 of CEQA, which supports the fact that, with limited exceptions, a public agency must prepare an EIR whenever substantial evidence supports a fair argument that a proposed project may have a significant effect on the environment. Section 21068 of CEQA defines a “significant effect on the environment” as a “substantial, or potentially substantial, adverse change in the environment.” Section 21151 of CEQA provides that:

• . . .if there is substantial evidence in the whole record supporting a fair argument that a project may have a significant nonmitigable effect on the environment, the lead agency shall prepare an EIR, even though it may also be presented with other substantial evidence that the project will not have a significant effect.

The court acknowledged and noted that the fair argument standard is a low threshold test for requiring the preparation of an EIR.

Aesthetic Impacts

To begin analysis, the court referred to CEQA and noted that aesthetic issues are properly studied under the CEQA. The CEQA Guidelines suggest that agencies consider whether a proposed project would “substantially degrade the existing visual character or quality of the site and its surroundings.”

The court cited to several cases that analyzed whether an EIR was required for a particular project. For instance, courts have previously emphasized that context is crucial in determining the appropriateness of CEQA aesthetic review. Particularly “sensitive” contexts may require an EIR. The court noted that a designated historical district is recognized as a particularly sensitive context.

HARB opined that the six-acre housing complex was inconsistent with the Niles HOD because of its height, density and massing, as well as its architectural style. The project was modified after the HARB meeting but the density and architectural style of the project was never changed.

The court ultimately concluded that substantial evidence supported a fair argument that the project would have an adverse aesthetic impact on the Niles HOD due, in part, to its sensitive context. The court further concluded that its function is to ensure that the CEQA environmental review process serves its purpose of facilitating informed decision making with public participation on environmental issues and preparing an EIR will facilitate the informed self-government process of evaluating the project’s aesthetic impact on the Niles HOD. The court determined that an EIR would describe the project’s compatibility with the Niles HOD, assess the adequacy of the proposed mitigation measures, discuss possible alternative designs and assess their feasibility.

Traffic Impacts

Valley Oaks argued that the trial court erred in concluding that substantial evidence supported a fair argument of significant traffic impacts from the project.

The Niles HOD is bordered by Alameda Creek to the south and west and Mission Boulevard to the north and east. Niles Boulevard (a two-lane minor arterial street) transverses Niles, connecting with Mission Boulevard east of Niles and becoming Alvarado-Niles Road west of the Niles commercial core on the way to Union City.

Heading westbound from Niles/Mission intersection, Niles Boulevard narrows, with a low speed limit, to pass under a railroad.

A traffic study was conducted and estimated that the project would generate 785 daily trips and at the New Street/Niles intersection, a left-turn pocket lane on westbound Niles Boulevard was warranted under national guidelines. The City, however, decided not to require a left turn pocket lane for two reasons: 1) without a left turn pocket lane, the intersection would operate much like the existing intersection in downtown Niles and 2) having no left turn pocket lane at the New Street/Niles intersection would help to slow down vehicles as they entered downtown Niles.

The Initial Study incorporated the traffic study’s analysis and concluded that the project would have less than significant traffic impacts with mitigation to ensure adequate sight distance at the New Street/Niles intersection.

However, residents and City officials expressed concern that, without a left turn pocket lane at the New Street/Niles intersection, westbound drivers on Niles Boulevard taking the hard right turn might run into cars queued up to turn left into the project. Other residents expressed concern about the speed limit and that “people go flying by my house at 45 and 50 mph before they reach the overpass into Union City.”

The court concluded that the fact-based comments are substantial evidence supporting a fair argument that the New Street/Niles intersection would create traffic safety hazards due to excessive queuing in the westbound lane, a tendency of westbound drivers to exceed the posted speed limit, and limited visibility around the 90-degree curve. Even the traffic study’s author acknowledged a left turn pocket lane was warranted by engineering standards. The court noted that this is the sort of evaluation that should follow preparation of an EIR, not justify reliance on an MND.

The court concluded that the fact-based comments by residents supported a fair argument that the project would have a significant adverse impact on traffic congestion on Niles Boulevard in the vicinity of the project.

Conclusion and Implications

The court concluded that substantial evidence supports a fair argument that the project would have significant adverse aesthetic and traffic impacts on the Niles Historic Overlay District and therefore the court affirmed the trial court’s decision.

As discussed above, the threshold for requiring a EIR is low and only a “fair argument” based on substantial evidence that a project may have a significant environmental impact must be presented to require an EIR. Therefore, it is common that a project similar to the project presented in this case will require an EIR to analyze aspects of the project, such as aesthetics and traffic, if no substantial evidence is presented that a significant effect on the environment would be reduced to an insignificant level by implementing mitigation measures and adopting an MND. The court’s decision is available online at: http://www.courts.ca.gov/opinions/documents/A151645.PDF

(Stephanie Nelson)