Planning Issues In Depth

A Trap for the Unwary Lead Agency: CEQA’s Latest Mediation Amendment

By Beth Collins-Burgard and Dylan K. Johnson, Brownstein Hyatt Farber Schreck LLP

A new CEQA mediation provision applicable to Notices of Exemption (NOEs) and Notices of Determination (NODs) filed after July 1, 2011, creates a potential trap for unwary lead agencies and applicants undergoing the CEQA review process.  Under the guise of supporting mediation and reducing CEQA litigation, Senate Bill 1456 (SB 1456), specifically the addition of Public Resources Codes section 21167.10, provides a method for project opponents to toll CEQA’s long-established and very short statute of limitations periods, potentially for indefinite periods of time and for all future project opponents.

CEQA includes short statute of limitations periods to create more certainty for agencies and permit applicants.  When a lead agency approves a project, the agency typically files either an NOE or NOD notifying the public of the agency action.  An NOD triggers a 30-day statute of limitations period and an NOE triggers a 35-day limitations period.  Petitioners can only file a CEQA challenge to an agency action within those limited time periods.  After that, their claims are barred.

The new statute creates a mediation mechanism.  It allows any person seeking to challenge an agency action under CEQA to submit, within five days of the lead agency filing its NOD/NOE, a request to the lead agency for mediation.  This request is designed to be submitted before the party files litigation.  If a lead agency “accepts” a request to mediate, CEQA’s statute of limitations is tolled “until completion of the mediation.”  (Pub. Res. Code § 21167.10(d).)  The statute does not define “completion of the mediation.”  Even worse, no mechanism is created for any party to terminate mediation and end the tolling period.  Further, the statute provides no time limit for the tolling period and appears to extend the tolling period to the parties who did not request mediation.

This new CEQA mediation provision introduces a host of potential problems for lead agencies and permit applicants.  If a lead agency “accepts” a proposal to mediate, that agency could end up mediating with one group while a separate group waits in the wings, preparing its own challenge during the tolling period.  Alternatively, a lead agency could find itself unable to terminate a mediation, even if it has determined that no resolution is possible, because there is no mechanism in the new section for the agency to restart CEQA’s statute of limitations period.  It is conceivable that an agency could declare that the mediation is completed, but the potential challenger disagrees and asserts that mediation should continue.  Finally, the new mediation mechanism has no finality:  an agency could successfully mediate with a group of opponents, only to find itself facing a lawsuit from one dissenting member because the statue of limitations period was tolled during the mediation period.

In short, the new statute is fatally flawed, and a public agency that has approved a project creates significant risks for itself and the permit applicant by agreeing to mediation under this new procedure.  In our opinion, public agencies should never accept a mediation proposal.  It is much safer to require that project opponents formulate their claims and file their lawsuit.  At that point, the agency and permit applicant will know exactly what parties have a potential claim against the project and the parties with whom they should mediate.

It bears noting that for years CEQA has included an expedited settlement procedure.  Public Resources Code section 21167.8 requires that a settlement conference be scheduled and held not later than 45 days from the date of service of the petition upon the public agency.  The settlement process is facilitated by the fact that the petitioners are known and have articulated their claims and although the agency may not be finished compiling the administrative record, the process is well underway, so the parties can evaluate the strength of the evidence in the record.  By contrast, the new mediation procedure set up by SB 1456 could lead an unwitting public agency into years of fruitless mediation with a party who  never intended to sue the project, but managed to accomplish significant delay by the simple expedient of requesting mediation.  A lead agency would be wise to avoid accepting a request to mediate under section 21167.10, lest it and the permit applicant be trapped in an interminable CEQA limbo.

This entry was posted on Wednesday, November 9th, 2011 at 2:04 am and is filed under: Openspace.