The California Sixth Appellate Court heard and gave guidance on the applicability of CEQA analysis in regards to a zoning updates and modernization by a municipality, certified for publication on 3/30/17. This is a particularly relevant case, state wide, as well as locally, as it gives likely guidance to the San Luis Obispo City Council, the San Luis Obispo Planning Commission, and the City of San Luis Obispo Community Development Department on how the bench will likely interpret revisions to existing ordinances and land use regulation. This decision changes how the San Luis Obispo Superior court is able to decide a case brought on similar grounds. The Superior Court, being inferior to the State Appellate Courts, must decide a similar matter using this guidance. However this decision, if appealed to the Second District Court of Appeals (the district in which San Luis Obispo is located) will be persuasive authority, given the geography of San Luis Obispo County being coastal and in other ways quite similar with the neighboring sixth district in precedent. Therefore, it is likely that these interpretations may be substantially comparable if not the same.


In this case the County of Santa Cruz began the process of a zoning regulation update. As part of this there were a series of regulations introduced for revision: 1) minor exceptions to zoning site standards regarding setbacks, height, and lot density (All changing the existing zoning less than approximately 15% with administrative review) 2) a hotel zoning ordinance that allowed hotels to move from 1,400sq/ft density to 11,000sq/ft density in order to allow more rooms per lot. In addition to these amendments the prohibition on more than three story hotels was lifted to allow, under the proper circumstances and with administrative approval, a four story hotel.

As part of the zoning modernization process the county used the rationale that “…modernizing, clarifying and streamlining regulations and the regulatory process is a top priority of the Planning Department, accomplished in a way that continues to respect community and environmental values” and further stated that the changes being made were “…completed in order to modernize, simplify, clarify, streamline and/or provide standards where there were no clear standards previously (such as for vacation rentals).” The County was in the process of completing a zoning update and as a result was making changes such as those outlined above for minor exceptions.

The County was completing this process in the Planning Department with information and input from the public. Having held many public hearings and other input/information gathering sessions, these changes were the result of community input as to individual ordinances. The City of Aptos City Council took another view however. Aptos Council interpreted the zoning revision when taken as a whole to represent a single project within the meaning of CEQA (California Environmental Quality Act). CEQA was the sweeping legislation introduced in the 70s shortly after the Federal Government introduced the Federal legislation known as NEPA or the National Environmental Policy Act. NEPA is the Federal mandate that any government project that may as a whole impact the environment adversely prepare a Environmental Impact Statement and an Environmental Assessment addressing the different impacts to and analyze through several subsequent steps the mitigation measures that can be used in order to minimize or offset unavoidable impacts. CEQA is the state version of NEPA. It was Aptos Council’s interpretation that this zoning revision, when considering the totality of the zoning review, represents a ‘project’ within the meaning of the term as defined in the CEQA documents.


CEQA broadly interprets ‘project’ as “an activity which may cause either direct physical change in the environment, or a reasonable foreseeable indirect physical change to the environment, and…that involves the issuance to a person of a lease, permit, license, certificate, or other entitlement for use by one or more public agencies.” In addition there is a principle introduced in the preamble of the CEQA document that the legislature intended the act “to be interpreted in such manner as to afford the fullest possible protection to the environment within the reasonable scope of the statutory language.”

Based on the forgoing language and other terms and provisions contained in the minutiae of CEQA, Aptos Council contended that an Environmental Impact Report (EIR) must be prepared and environmental impacts be given due consideration in the drafting of zoning regulations. Council argued that by increasing the density of the hotel lots by allowing a reduction in minimum size of the hotel rooms that County was increasing the environmental impacts of those uses. Additionally, the provision that there can be minor exceptions to the existing zoning laws, densities, and other regulations acted as an impact on the environment. Council further contended that all of these impacts, when viewed in a county and city wide context, amount to a ‘project’ within the meaning of CEQA and as a result the County was wrong for finding a negative declaration. A Negative Declaration is a document that states that, upon completion of an reasonable study and finding, a municipality or government has determined that there is no substantial evidence that the project may have a significant effect on the environment or, if there are found impacts that they are trivial or minor (de minimis). If impacts are found mitigation measures must be instituted or a finding of an unavoidable significant impact must be made known to the body for consideration as to the feasibility and design of offsetting mitigations elsewhere.

County on the other hand relied on the argument that the zoning revision is not a ‘project’ within the meaning of CEQA and introduced an excerpt from CEQA that minor alternations, limited variances with land use and accessory structures are exempt from CEQA and further introduced the ‘common sense exemption” in defense of their negative declaration which states “…(3) the common sense exemption which applies when ‘it can be seen with certainty that there is no possibility that the activity in question may have significant effect on the environment” ( CEQA Guidelines, § 15601, subd. (b)(3)).”

To counter County’s contention, City made the argument that while County’s argument may be correct as to the zoning revisions as applied to the existing housing and structure inventory, it must take into account future developments in order to be able adequately protect the environment. County argues that it cannot reasonably forecast future projects that would be a result of this revision.

The court gives the several examples in agreement with City’s contention. The most telling is the example of when a zoning revision would allow a shopping center to be constructed. As part of the revision there would need to be a road realignment. The Court pointed out that because the zoning change would all but require a road to be realigned in order to take advantage of the revision that the impact of the road needs to be accounted for when deciding as to CEQA. In the California Supreme Court Case Laurel Height Improvement Assn. v. Regents of University of California (1988) 47 Cal.3d 376, 390 (Laurel Heights). A two part rule was outlined and as of the deciding of this case is still good law. An EIR must include effects of future expansion or other action if: 1) it is a reasonably foreseeable consequence of the initial project, and 2) the future expansion or action will be significant in that it will likely change the scope or nature of the initial project or its environmental effects.

The court outlines that the impacts must be reasonably foreseeable, giving guidance as to what this means the court points out that the ordinances can be taken advantage of one at a time, and it is very likely that the ordinances will be used one ordinance at a time. The court outlines precedents and cases where you cannot base a CEQA determination on neighboring projects when there are different proponents for those projects. In addition the court points out that the future impacts must be foreseeable; pointing out that the County had contacted affected property owners and other owners of blank parcels where the zoning regulations would be reformed and the amendments to the zoning regulation would not induce the owners to change their projects or properties.


Because there were no imminent projects after study that would be influenced by this modernization and reform, the court found that the reformation of the code for the County’s stated objectives was not a ‘project’ within the meaning of CEQA and County properly used the exemptions from CEQA in order to not complete an Environmental Impact Report. In addition it was noted by the court that existing unamended ordinances would adequately prevent the type of community impacts that a revision would have. The court did however say that, based on THESE facts and circumstances that the revision did not represent a project within the meaning of CEQA. The court was very careful to point out that, given the right facts, a zoning modernization and revision would require a CEQA analysis and environmental impact.

STOP WHAT YOU”RE DOING! If you haven’t already done so, subscribe to my blog to get weekly posts in your inbox on: Real Property, Property Law, Real Estate, Construction, and Property Politics in California.

DISCLAIMER: Let me stop here to give you the boilerplate disclaimer. Every situation in law, real estate and building is different. Do not rely on this article to make decisions on your specific situation. Every matter is different and requires that you talk to a professional. If you want to talk to me about your matter see my contact below. Nothing in this article shall be construed to create an attorney client relationship or partnership.


Dan Knight is principle at Dan Knight Construction & Plumbing and The Law Office of Daniel J. Knight. He is a third generation building contractor, attorney, real estate broker, construction management lecturer at Cal Poly State University, and Lead Instructor at Cuesta Community College Construction Technology Program in San Luis Obispo. He is a former San Luis Obispo City Planning Commissioner.

His practice focuses on construction defect expert witness engagements, construction defect representation, land use and zoning, public interest real property matters, and private real property matters.

Phone 805-316-1180 | Email:

Twitter: @Nerd_Contractor


Office Location 1103 Johnson Ave #H, San Luis Obispo CA 93401