Title: Union of Medical Marijuana Patients, Inc. v. City of San Diego

State: california

Issuer: California Supreme Court

Document:

IN THE SUPREME COURT OF 
CALIFORNIA 
 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
Plaintiff and Appellant, 
v. 
CITY OF SAN DIEGO, 
Defendant and Respondent;  
CALIFORNIA COASTAL COMMISSION, 
Real Party in Interest. 
 
S238563 
 
Fourth Appellate District, Division One 
D068185 
 
San Diego County Superior Court 
37-2014-00013481-CU-TT-CTL 
 
 
August 19, 2019 
 
Chief Justice Cantil-Sakauye authored the opinion of the 
Court, in which Justices Chin, Corrigan, Liu, Cuéllar, Kruger 
and Groban concurred. 
 
 
1 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
S238563 
 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
 
The California Environmental Quality Act, Public 
Resources Code sections 21000 et seq. (CEQA), applies to 
“projects,” a term defined by statute.  In general, a project is an 
activity that (1) is undertaken or funded by, or subject to the 
approval of a public agency and (2) may cause “either a direct 
physical change in the environment, or a reasonably 
foreseeable indirect physical change in the environment.”  
(Pub. Res. Code, § 21065.)1  Although section 21065 supplies 
the definition of a project, another provision of CEQA, section 
21080, subdivision (a), can be interpreted to declare specified 
public agency activities, including the amendment of a zoning 
ordinance, to be a project as a matter of law, without regard to 
their potential for causing a physical change in the 
environment.  In this matter, we must decide whether to adopt 
this interpretation of section 21080, which would prevail over 
section 21065 with respect to the specific public agency 
activities listed in section 21080. 
 
In 2014, the City of San Diego (City) adopted an 
ordinance authorizing the establishment of medical marijuana 
                                        
1  
Unless 
indicated 
otherwise, 
all 
further 
statutory 
references are to the Public Resources Code. 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
2 
dispensaries and regulating their location and operation.  The 
central provisions of this ordinance amended various City 
zoning regulations to specify where the newly established 
dispensaries may be located.  Because the City found that 
adoption of the ordinance did not constitute a project for 
purposes of CEQA, it did not conduct any environmental 
review.  Petitioner Union of Medical Marijuana Patients 
(UMMP) challenged the City’s failure to conduct CEQA review 
in a petition for writ of mandate, which was denied by the trial 
court. 
On appeal, UMMP argued (1) the amendment of a zoning 
ordinance, one of the public agency activities listed in section 
21080, is conclusively declared a project by that statute and 
(2) the City’s ordinance, in any event, satisfied the definition of 
a project under section 21065.  The former argument was 
premised in part on Rominger v. County of Colusa (2014) 
229 Cal.App.4th 690 (Rominger), which relied on section 21080 
in concluding that a county’s approval of a tentative 
subdivision map, another activity listed in section 21080, was a 
project as a matter of law.  Here, the Court of Appeal disagreed 
with Rominger, concluding that the amendment of a zoning 
ordinance is subject to the same statutory test as public agency 
activities not listed in section 21080.  The court proceeded to 
find no error in the City’s conclusion that the ordinance was 
not a project because it did not have the potential to cause a 
physical change in the environment.  We granted review to 
resolve the conflict between the two Courts of Appeal regarding 
the interpretation of section 21080. 
We agree with the Court of Appeal below that section 
21080 does not override the definition of project found in 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
3 
section 21065.  Accordingly, the various activities listed in 
section 21080 must satisfy the requirements of section 21065 
before they are found to be a project for purposes of CEQA.  On 
the other hand, we conclude that the Court of Appeal 
misapplied the test for determining whether a proposed 
activity has the potential to cause environmental change under 
section 21065, which was established in Muzzy Ranch Co. v. 
Solano County Airport Land Use Commission (2007) 41 Cal.4th 
372 (Muzzy Ranch), and erred in affirming the City’s finding 
that adoption of the ordinance did not constitute a project.  For 
that reason, we reverse and remand for further proceedings. 
I.  FACTUAL AND PROCEDURAL BACKGROUND 
A. The City’s Medical Marijuana Ordinance 
 
Health and Safety Code section 11362.83, a provision of 
the Medical Marijuana Program (Health & Saf. Code, 
§ 11362.7 
et 
seq.), 
recognizes 
the 
authority 
of 
local 
governments to adopt ordinances regulating the “location, 
operation, 
or 
establishment 
of 
a 
medicinal 
cannabis 
cooperative or collective.”  (Health & Saf. Code, § 11362.83, 
subd. (a); see Kirby v. County of Fresno (2015) 242 Cal.App.4th 
940, 956.)  In 2014, the City enacted such a regulation, San 
Diego Ordinance No. O-20356 (Ordinance).  The Ordinance 
amended a variety of City Municipal Code sections to authorize 
the establishment, and regulate the siting and operation of, 
“medical marijuana consumer cooperatives” (dispensaries), 
which were defined as “a facility where marijuana is 
transferred to qualified patients or primary caregivers in 
accordance with the Compassionate Use Act of 1996 and the 
Medical Marijuana Program Act.”  (Ord., § 1.) 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
4 
The primary provisions of the Ordinance amended 
several of the City’s zoning regulations to cap the number of 
dispensaries and specify where in the City they could be 
located.  Dispensaries were added to the list of permitted uses 
in two of the City’s six categories of commercial zones and two 
of the four categories of industrial zones (Ord., §§ 6, 7, 13, 15), 
and 
they 
were 
expressly 
excluded 
from 
open 
space, 
agricultural, and residential zones.  (Id., §§ 3, 4, 5.)  
Dispensaries were also added to the list of permitted uses in 
certain planned districts of the City.  (Id., §§ 10, 11, 13.)  The 
Ordinance placed an upper limit of four dispensaries in any 
single city council district and required a dispensary to be 
located more than 1,000 feet from certain sensitive uses, such 
as parks and schools, and more than 100 feet from a 
residential zone.  (Id., § 8.)  Regardless of location, the 
Ordinance required the grant of a conditional use permit for a 
dispensary’s operation.  (Id., §§ 2, 6, 7, 8.) 
 
In addition to defining the location of dispensaries, the 
Ordinance imposed basic conditions on their operation, such as 
prohibiting the provision of medical consultation services, 
requiring particular lighting and security, defining permissible 
signage, and limiting hours of operation.  (Ord., § 8.) 
 
Because the City contains nine city council districts, the 
Ordinance’s limit of four dispensaries per district permitted, in 
theory, the establishment of 36 dispensaries.  A study 
commissioned by the City, however, found that the other 
restrictions placed on the location of dispensaries by the 
Ordinance, such as the limitation to particular zoning districts 
and the minimum distance from sensitive uses, precluded the 
establishment of a dispensary entirely in one city council 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
5 
district and limited two other districts to three dispensaries 
each.  This left a practical maximum of 30 dispensaries.  City 
planning 
staff 
concluded 
that 
the 
actual 
number 
of 
dispensaries to be created “is very likely to be significantly 
less,” since “factors such as available units for rent, rental 
rates, overall demand for dispensaries, and proximity of 
potential sites to target markets would rule out some sites.” 
 
Because the City found CEQA inapplicable to the 
Ordinance’s enactment, it conducted no environmental review 
prior to its adoption.  The City’s finding explained its 
reasoning:  “The . . . Ordinance is not subject to [CEQA] . . . , in 
that it is not a Project . . . .  Adoption of the ordinance does not 
have the potential for resulting in either a direct physical 
change in the environment, or reasonably for[e]seeable indirect 
physical change in the environment.  Future projects subject to 
the ordinance will require a discretionary permit and CEQA 
review, and will be analyzed at the appropriate time in 
accordance with CEQA.” 
B. This Litigation 
According to its President, UMMP is “a civil rights 
organization that is devoted to defending and asserting the 
rights of medical cannabis patients as well as promoting safe 
access to medical marijuana.”  Prior to adoption of the 
Ordinance, UMMP submitted two letters to the City Council 
objecting to the failure to conduct environmental review under 
CEQA.  The letters argued that the Ordinance should have 
been found to be a project for purposes of CEQA because it had 
the potential to cause either a direct physical change in the 
environment or a reasonably foreseeable indirect physical 
change.  (§ 21065.)  According to UMMP, adoption of the 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
6 
Ordinance could affect the environment because (1) restrictions 
on the siting of dispensaries would require “thousands of 
patients to drive across the City” to obtain medical marijuana; 
(2) the City might prosecute and close existing, unpermitted 
marijuana dispensaries, causing medical marijuana users to 
engage in the “inherently agricultural practice” of growing 
their own marijuana; and (3) “the unique development impacts 
associated with [dispensaries] [would be] shifted to certain 
areas of the City and intensified due to the limit on the total 
number of [dispensaries].” 
After the City disregarded UMMP’s arguments and 
adopted the Ordinance without further environmental review, 
UMMP filed a petition for writ of mandate challenging the 
adoption of the Ordinance under CEQA.  The trial court, in an 
extensive written minute order, rejected UMMP’s claims of the 
Ordinance’s potential for causing environmental change, 
concluding there was insufficient evidence in the record to 
support those claims. 
On appeal, UMMP repeated its argument that the 
Ordinance should have been considered a project as a result of 
its potential for physical change in the environment, but it 
raised the additional argument that the Ordinance should be 
deemed a project as a matter of law under section 21080, which 
states that CEQA “shall apply to discretionary projects 
proposed to be carried out or approved by public agencies, 
including, but not limited to, the enactment and amendment of 
zoning ordinances . . . .”  (§ 21080, subd. (a).)  In effect, UMMP 
argued, section 21080 classifies every zoning amendment as a 
project under CEQA, regardless of its potential for effecting 
environmental change.  In a published opinion that will be 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
7 
discussed in more detail post, the Court of Appeal rejected both 
arguments.  (Union of Medical Marijuana Patients, Inc. v. City 
of San Diego (2016) 4 Cal.App.5th 103, 116, 119-124 
(Marijuana Patients).)  In doing so, the court expressly 
disagreed 
with 
the 
holding 
of 
Rominger, 
supra, 
229 Cal.App.4th 690, that section 21080 declares the specified 
public agency activities to be CEQA projects as a matter of law.  
(Rominger, at pp. 702-703; Marijuana Patients, at p. 118.) 
II.  DISCUSSION 
A.  Governing Law 
1.  Statutory interpretation 
Statutory interpretation is “an issue of law, which we 
review de novo.”  (United Riggers & Erectors, Inc. v. Coast Iron 
& Steel Co. (2018) 4 Cal.5th 1082, 1089.) 
Our overriding purpose in construing a provision of 
CEQA, as with any statute, is “to adopt the construction that 
best gives effect to the Legislature’s intended purpose.”  
(California Building Industry Assn. v. Bay Area Air Quality 
Management Dist. (2015) 62 Cal.4th 369, 381 (Building 
Industry).)  In determining that intended purpose, we follow 
“[s]ettled principles.”  (Elk Hills Power, LLC v. Board of 
Equalization (2013) 57 Cal.4th 593, 609 (Elk Hills).)  “We 
consider first the words of a statute, as the most reliable 
indicator of legislative intent.”  (Tuolumne Jobs & Small 
Business Alliance v. Superior Court (2014) 59 Cal.4th 1029, 
1037 (Tuolumne Jobs).)  In doing so, we give the words “their 
usual and ordinary meaning,” viewed in the context of the 
statute as a whole.  (Pineda v. Williams-Sonoma Stores, Inc. 
(2011) 51 Cal.4th 524, 529.)  As part of this process, “ ‘ “[every] 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
8 
statute should be construed with reference to the whole system 
of law of which it is a part so that all may be harmonized and 
have effect.” ’ ”  (Elk Hills, at p. 610.) 
When the language of a statute is ambiguous — that is, 
when the words of the statute are susceptible to more than one 
reasonable meaning, given their usual and ordinary meaning 
and considered in the context of the statute as a whole — we 
consult other indicia of the Legislature’s intent, including such 
extrinsic aids as legislative history and public policy.  (Ceja v. 
Rudolph & Sletten, Inc. (2013) 56 Cal.4th 1113, 1119; Elk 
Hills, supra, 57 Cal.4th at pp. 609-610.)  If there is no 
ambiguity, “ ‘ “ ‘we presume the Legislature meant what it said 
and the plain meaning of the statute governs.’ ” ’ ”  (Ceja, at 
p. 1119.) 
 
In 
construing 
provisions 
of 
CEQA, 
two 
unique 
considerations apply.  First, CEQA is implemented by an 
extensive series of administrative regulations promulgated by 
the Secretary of the Natural Resources Agency, ordinarily 
referred to as the “CEQA Guidelines.”2  (Guidelines, § 15000.)  
Through long practice, we “afford great weight to the 
Guidelines except when a provision is clearly unauthorized or 
erroneous under CEQA.”  (Laurel Heights Improvement Assn. 
v. Regents of University of California (1988) 47 Cal.3d 376, 391, 
fn. 2; see Building Industry, supra, 62 Cal.4th at p. 381.)  
Second, from CEQA’s inception we have held that “the 
                                        
2  
We will cite and refer to CEQA’s implementing 
regulations, codified at title 14, division 6, chapter 3 of the 
California Code of Regulations, as the “Guidelines.” 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
9 
Legislature intended . . . [C]EQA to be interpreted in such 
manner as to afford the fullest possible protection to the 
environment within the reasonable scope of the statutory 
language.”  (Friends of Mammoth v. Board of Supervisors 
(1972) 8 Cal.3d 247, 259; see Building Industry, at p. 381.) 
2.  CEQA generally 
“CEQA was enacted to advance four related purposes:  to 
(1) inform the government and public about a proposed 
activity’s potential environmental impacts; (2) identify ways to 
reduce, 
or 
avoid, 
environmental 
damage; 
(3) 
prevent 
environmental damage by requiring project changes via 
alternatives or mitigation measures when feasible; and 
(4) disclose to the public the rationale for governmental 
approval of a project that may significantly impact the 
environment.”  (Building Industry, supra, 62 Cal.4th at p. 382.)  
“CEQA embodies a central state policy to require state and 
local governmental entities to perform their duties ‘so that 
major consideration is given to preventing environmental 
damage.’  [Citations.]  [¶]  CEQA prescribes how governmental 
decisions will be made when public entities, including the state 
itself, are charged with approving, funding — or themselves 
undertaking — a project with significant effects on the 
environment.”  (Friends of the Eel River v. North Coast 
Railroad Authority (2017) 3 Cal.5th 677, 711-712, italics 
omitted (Eel River).) 
“CEQA review is undertaken by a lead agency, defined as 
‘the public agency which has the principal responsibility 
for carrying out or approving a project which may have a 
significant effect upon the environment.’ ”  (Eel River, supra, 
3 Cal.5th at p. 712, quoting § 21067, italics omitted.)  
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
10 
A putative lead agency’s implementation of CEQA proceeds by 
way of a multistep decision tree, which has been characterized 
as having three tiers.  (Muzzy Ranch, supra, 41 Cal.4th at 
p. 380.)  First, the agency must determine whether the 
proposed activity is subject to CEQA at all.  Second, assuming 
CEQA is found to apply, the agency must decide whether the 
activity qualifies for one of the many exemptions that excuse 
otherwise covered activities from CEQA’s environmental 
review.  Finally, assuming no applicable exemption, the agency 
must undertake environmental review of the activity, the third 
tier.3  (Muzzy Ranch, at pp. 380-381.)  We examine the three-
tier process in more detail below. 
CEQA’s applicability:  When a public agency is asked to 
grant regulatory approval of a private activity or proposes to 
fund or undertake an activity on its own, the agency must first 
decide whether the proposed activity is subject to CEQA.  
(Guidelines, § 15060, subd. (c).)  In practice, this requires the 
agency to conduct a preliminary review to determine whether 
the proposed activity constitutes a “project” for purposes of 
CEQA.  (Tuolumne Jobs, supra, 59 Cal.4th at p. 1037; see 
§ 21065; 
Guidelines, 
§ 15378, 
subd. 
(a) 
[both 
defining 
                                        
3  
In a very early CEQA case, No Oil, Inc. v. City of Los 
Angeles (1974) 13 Cal.3d 68, we described the three tiers 
differently, disregarding the project step and dividing the third 
tier into two parts, the preparation of an initial study and, if 
required, an environmental impact report (EIR).  (Id. at p. 74.)  
Because the initial study and EIR are both aspects of 
environmental 
review, 
we 
find 
the 
Muzzy 
Ranch 
characterization more helpful in understanding CEQA’s 
procedures. 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
11 
“project”].)  If the proposed activity is found not to be a project, 
the agency may proceed without further regard to CEQA.4  
(Muzzy Ranch, supra, 41 Cal.4th at p. 380; Guidelines, 
§ 15060, subd. (c)(3) [if a proposed activity does not qualify as a 
project, it “is not subject to CEQA”].) 
Exemption from environmental review:  If the lead agency 
concludes it is faced with a project, it must then decide 
“whether the project is exempt from the CEQA review process 
under either a statutory exemption [citation] or a categorical 
exemption set forth in the CEQA Guidelines.”  (Building 
Industry, supra, 62 Cal.4th at p. 382.)  The statutory 
exemptions, created by the Legislature, are found in section 
21080, subdivision (b).  Among the most important exemptions 
is the first, for “[m]inisterial” projects, which are defined 
generally as projects whose approval does not require an 
agency to exercise discretion.  (§ 21080, subd. (b)(1); 
Guidelines, § 15369; see Sierra Club v. County of Sonoma 
(2017) 11 Cal.App.5th 11, 19-20 (Sierra Club).)  The categorical 
exemptions, found in Guidelines sections 15300 through 15333, 
were promulgated by the Secretary for Natural Resources in 
response to the Legislature’s directive to develop “a list of 
                                        
4  
Courts 
have 
often 
labeled 
the 
project 
decision 
“jurisdictional” because it determines whether CEQA applies 
at all.  (Muzzy Ranch, supra, 41 Cal.4th at p. 380; Davidon 
Homes v. City of San Jose (1997) 54 Cal.App.4th 106, 112.)  
The term is inapposite because an agency’s jurisdiction over a 
proposed activity does not depend upon the application of 
CEQA.  Nonetheless, its use conveys the preliminary nature of 
the project determination. 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
12 
classes of projects which have been determined not to have a 
significant effect on the environment.”  (§ 21084, subd. (a); 
Guidelines, 
§ 15354; 
see 
generally, 
Berkeley 
Hillside 
Preservation v. City of Berkeley (2015) 60 Cal.4th 1086, 1100-
1101 (Berkeley Hillside).)  If the lead agency concludes a 
project is exempt from review, it must issue a notice of 
exemption citing the evidence on which it relied in reaching 
that conclusion.  (Muzzy Ranch, supra, 41 Cal.4th at pp. 380, 
386-387.)  The agency may thereafter proceed without further 
consideration of CEQA. 
Environmental review:  Environmental review is required 
under CEQA only if a public agency concludes that a proposed 
activity is a project and does not qualify for an exemption.  In 
that case, the agency must first undertake an initial study to 
determine whether the project “may have a significant effect on 
the environment.”  (Guidelines, § 15063, subd. (a); Friends of 
the College of San Mateo Gardens v. San Mateo County 
Community College Dist. (2016) 1 Cal.5th 937, 945 (San Mateo 
Gardens).)  If the initial study finds no substantial evidence 
that the project may have a significant environmental effect, 
the lead agency must prepare a negative declaration, and 
environmental review ends.  (§ 21080, subd. (c)(1); San Mateo 
Gardens, at p. 945.)  If the initial study identifies potentially 
significant environmental effects but (1) those effects can be 
fully mitigated by changes in the project and (2) the project 
applicant agrees to incorporate those changes, the agency must 
prepare a mitigated negative declaration.  This too ends CEQA 
review.  (§ 21080, subd. (c)(2); San Mateo Gardens, at p. 945.)  
Finally, if the initial study finds substantial evidence that the 
project may have a significant environmental impact and a 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
13 
mitigated negative declaration is inappropriate, the lead 
agency must prepare and certify an environmental impact 
report before approving or proceeding with the project.  
(§ 21080, subd. (d); Building Industry, supra, 62 Cal.4th at 
p. 382.) 
3.  The Court of Appeal’s decision 
 
At issue before the Court of Appeal was the first tier in 
the CEQA process, the determination by a putative lead 
agency whether a proposed activity constitutes a project.  In 
particular, the court was asked to decide whether a public 
agency’s amendment of a zoning ordinance constitutes a 
project as a matter of law. 
As suggested ante, two separate provisions of the Public 
Resources Code are potentially relevant to this question.  
“Project” is defined in section 21065 as an activity 
(1) undertaken or funded by or requiring the approval of a 
public agency that (2) “may cause either a direct physical 
change in the environment, or a reasonably foreseeable 
indirect physical change in the environment.”5  (See Sunset 
                                        
5  
The full text of section 21065 follows: 
“ ‘Project’ means an activity which may cause either a 
direct physical change in the environment, or a reasonably 
foreseeable indirect physical change in the environment, and 
which is any of the following: 
“(a) An activity directly undertaken by any public agency. 
“(b) An activity undertaken by a person which is 
supported, in whole or in part, through contracts, grants, 
subsidies, loans, or other forms of assistance from one or more 
public agencies. 
 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
14 
Sky Ranch Pilots Assn. v. County of Sacramento (2009) 
47 Cal.4th 902, 907 (Sky Ranch Pilots).)  The controversy 
arises because a related statute, section 21080, can be 
interpreted to override section 21065 with respect to the 
classification of zoning ordinance amendments and certain 
other public agency activities:  “Except as otherwise provided 
in this division, this division shall apply to discretionary 
projects proposed to be carried out or approved by public 
agencies, including, but not limited to, the enactment and 
amendment of zoning ordinances, the issuance of zoning 
variances, the issuance of conditional use permits, and the 
approval of tentative subdivision maps unless the project is 
exempt from this division.”  (§ 21080, subd. (a), italics added.)  
As UMMP argued, this language can be read to classify the 
various listed agency activities as “discretionary projects” in 
every case, regardless of their potential for bringing about a 
physical change in the environment. 
The Court of Appeal rejected UMMP’s argument that 
“any enactment of a zoning ordinance by a public agency 
necessarily constitutes a project.”  (Marijuana Patients, supra, 
4 Cal.App.5th at p. 114.)  The court began its analysis by 
concluding that section 21080’s listing of various local agency 
activities is ambiguous.  As the court viewed it, the Legislature 
could have intended either “that the examples given . . . are 
illustrations of activities that are ‘discretionary projects 
                                                                                                           
 
“(c) An activity that involves the issuance to a person of a 
lease, permit, license, certificate, or other entitlement for use 
by one or more public agencies.” 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
15 
proposed to be carried out or approved by public agencies,’ or 
. . . are illustrations of activities ‘proposed to be carried out or 
approved by public agencies,’ but that not all such activities 
will qualify as ‘discretionary projects.’ ”  (Marijuana Patients, 
at p. 115.)  The court rejected the first reading on the basis of 
section 21065.  It noted that section 21065 defines a project as 
having two characteristics, the potential to cause a physical 
change in the environment and the involvement of a public 
agency.  To harmonize the “more specific provision” of section 
21065 with the “more general provision” of section 21080, the 
court held that the “most reasonable interpretation” of section 
21080, subdivision (a), is that the various listed public agency 
activities are examples of “ ‘[a]n activity directly undertaken by 
any public agency’ as set forth in section 21065, but that the 
enactment or amendment of a zoning ordinance will not 
constitute a CEQA project unless it also meets the second 
requirement in section 21065, namely that it ‘may cause either 
a direct physical change in the environment, or a reasonably 
foreseeable indirect physical change in the environment.’ ”  
(Marijuana Patients, at p. 116.) 
The court found support for its interpretation in 
Guidelines section 15378.  (Marijuana Patients, supra, 
4 Cal.App.5th at p. 116.)  As noted above, the Guidelines are 
“afford[ed] great weight” in interpreting CEQA.  (Building 
Industry, supra, 62 Cal.4th at p. 381.)  In defining “project,” 
Guidelines section 15378, subdivision (a)(1) partially melds 
sections 21065 and 21080:  “ ‘Project’ means the whole of an 
action, which has a potential for resulting in either a direct 
physical change in the environment, or a reasonably 
foreseeable indirect physical change in the environment, and 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
16 
that is any of the following:  [¶]  (1)  An activity directly 
undertaken by any public agency including but not limited to 
public works construction and related activities[,] clearing or 
grading of land, improvements to existing public structures, 
enactment and amendment of zoning ordinances, and the 
adoption and amendment of local General Plans or elements 
thereof . . . .”6  Although Guidelines section 15378 includes an 
express reference to the enactment or amendment of a zoning 
ordinance, it classifies those activities merely as examples of 
“activit[ies] directly undertaken by any public agency.”  
(Id., subd. (a)(1).)  The requirement that an activity have the 
potential to cause a change in the environment is classified by 
                                        
6  
The 
complete 
text 
of 
Guidelines 
section 
15378, 
subdivision (a), is as follows: 
“ ‘Project’ means the whole of an action, which has a 
potential for resulting in either a direct physical change in the 
environment, or a reasonably foreseeable indirect physical 
change in the environment, and that is any of the following: 
“(1)  An activity directly undertaken by any public agency 
including but not limited to public works construction and 
related activities[,] clearing or grading of land, improvements 
to existing public structures, enactment and amendment of 
zoning ordinances, and the adoption and amendment of local 
General Plans or elements thereof pursuant to Government 
Code Sections 65100-65700. 
“(2)  An activity undertaken by a person which is 
supported in whole or in part through public agency contracts, 
grants, subsidies, loans, or other forms of assistance from one 
or more public agencies. 
“(3)  An activity involving the issuance to a person of a 
lease, permit, license, certificate, or other entitlement for use 
by one or more public agencies.” 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
17 
Guidelines section 15378 as an independent element of 
“project,” applicable whether or not the activity is listed in 
section 21080.  “Thus,” the Court of Appeal concluded, “under 
the CEQA Guidelines, the enactment and amendment of a 
zoning ordinance is a project only if that action also creates ‘a 
potential for resulting in either a direct physical change in the 
environment, or a reasonably foreseeable indirect physical 
change in the environment.’ ”  (Marijuana Patients, supra, at 
p. 116.) 
The Court of Appeal rejected the contrary conclusion of 
Rominger, supra, 229 Cal.App.4th 690, because that court’s 
“analysis ignores the definition of a project as set forth in 
CEQA and the CEQA Guidelines.”  (Marijuana Patients, supra, 
4 Cal.App.5th at p. 118.)  Rominger, in holding that a county’s 
approval of a tentative subdivision map constituted a project as 
a matter of law under section 21080, did not base its ruling on 
an analysis of the respective texts of sections 21065 and 21080.  
Rather, it looked to our observation in Muzzy Ranch, supra, 41 
Cal.4th 372, that “[w]hether an activity constitutes a project 
subject to CEQA is a categorical question respecting whether 
the activity is of a general kind with which CEQA is concerned, 
without regard to whether the activity will actually have 
environmental impact.”  (Id. at p. 381.)  Taking this principle 
as its guide, Rominger concluded that “the Legislature has 
determined [in section 21080, subdivision (a)] that certain 
activities, including the approval of tentative subdivision 
maps, always have at least the potential to cause a direct 
physical change or a reasonably foreseeable indirect physical 
change in the environment.”  (Rominger, at p. 702.)  In 
reaching this conclusion, Rominger did not, as Marijuana 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
18 
Patients rightly noted, take into account the language of 
section 21065 or otherwise attempt to reconcile the two 
statutes. 
Having held that the Ordinance was not a project unless 
it had the potential to cause a direct or reasonably foreseeable 
indirect physical change in the environment, as required by 
section 21065, the Court of Appeal proceeded to consider 
UMMP’s argument that the City erred in concluding that the 
Ordinance did not have that potential.  (Marijuana Patients, 
supra, 4 Cal.App.5th at p. 119.)  UMMP effectively conceded 
that the Ordinance did not have the potential to cause a direct 
physical change (Marijuana Patients, at p. 113), but it 
contended, as noted above, that the Ordinance had the 
potential to cause various indirect effects, namely, increased 
traffic from patients driving to the new dispensaries, increased 
self-cultivation of marijuana, and changed patterns of urban 
development within the City.  (Marijuana Patients, at p. 120.)  
After evaluating each of the claimed indirect effects 
individually, the court concluded that all were too speculative 
or lacking in evidentiary support in the administrative record 
to permit a finding that they were reasonably foreseeable, as 
required by section 21065.  (Marijuana Patients, at pp. 120-
124.)  Finding no error in the City’s determination that CEQA 
was inapplicable, the Court of Appeal affirmed the trial court’s 
denial of a writ of mandate.  (Marijuana Patients, at p. 124.) 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
19 
B. Whether Section 21080 Conclusively Declares 
the Amendment of a Zoning Ordinance To Be a 
CEQA “Project” 
We agree with the Court of Appeal that section 21080 
does not dictate the result here as a matter of law, and we 
agree for essentially the reasons cited by that court.7 
As the Court of Appeal concluded, section 21080’s 
statement that CEQA applies to “discretionary projects 
proposed to be carried out or approved by public agencies,” 
followed by its listing of the amendment of a zoning ordinance 
as an example, is ambiguous, at least when considered in 
isolation.  It is unclear from the text of section 21080 whether 
the amendment of a zoning ordinance, as well as the other 
listed activities, are examples of “discretionary projects” to 
                                        
7  
The City urges us to dismiss this appeal as moot on the 
basis of Business and Professions Code section 26055, 
subdivision (h), enacted after we granted review (Stats. 2017, 
ch. 27, § 41), which exempts from CEQA a public agency’s 
enactment of any regulation that requires discretionary review 
of licenses to engage in “commercial cannabis activity.”  The 
City does not argue that subdivision (h) applies retroactively to 
exempt the Ordinance from CEQA, and we offer no opinion on 
that issue.  Instead, the City contends that UMMP can no 
longer be granted effective relief because the City could re-
enact the Ordinance without environmental review.  (See In re 
David B. (2017) 12 Cal.App.5th 633, 644 [a matter becomes 
moot if effective relief can no longer be granted].)  We reject the 
argument because the trial court can still grant some of the 
relief requested by UMMP by vacating the City’s approval of 
the Ordinance, if such relief is appropriate.  (See Save Tara v. 
City of West Hollywood (2008) 45 Cal.4th 116, 127 [matter not 
moot because petitioner “can still be awarded the relief it 
seeks, an order that [the] [c]ity set aside its approvals”].) 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
20 
which CEQA does apply, or whether they are examples of 
discretionary activities “proposed to be carried out or approved 
by public agencies” to which CEQA might apply. 
When interpreting the provisions of CEQA, however, we 
do not consider them in isolation, but in the context of the 
entire statute.  (Tuolumne Jobs, supra, 59 Cal.4th 1029, 1037.)  
Within CEQA, “project” is not merely a word; it is a defined 
term.  “ ‘If the Legislature has provided an express definition of 
a term, that definition ordinarily is binding on the courts.’ ”  
(State ex rel. Dept. of California Highway Patrol v. Superior 
Court (2015) 60 Cal.4th 1002, 1011.)  As a corollary of this 
principle, “[t]erms defined by the statute in which they are 
found will be presumed to have been used in the sense of the 
definition.”  (Faulder v. Mendocino County Bd. of Supervisors 
(2006) 144 Cal.App.4th 1362, 1371.)  In the case of CEQA, this 
judicial presumption is legislatively mandated.  Section 21060 
expressly 
states 
that 
CEQA’s 
definitions 
“govern 
the 
construction of this division.” 
Applying this principle of interpretation, we must 
assume that in using the defined term “project” in section 
21080, the Legislature intended it to bear the definition 
assigned in section 21065.  Accordingly, the first portion of 
section 21080, subdivision (a) — “Except as otherwise provided 
in this division, this division shall apply to discretionary 
projects proposed to be carried out or approved by public 
agencies” — must be understood to mean that CEQA applies to 
activities proposed to be carried out or approved by a public 
agency that both (1) are discretionary and (2) satisfy the 
requirements for a project under section 21065.  Although all of 
the exemplary activities listed in section 21080 necessarily 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
21 
satisfy 
section 
21065’s 
requirement 
of 
public 
agency 
involvement, there is no reason to conclude that they 
invariably satisfy its requirement of the potential to cause a 
physical change in the environment.  For that reason, we must 
interpret the listing of public agency activities in section 
21080, subdivision (a), merely to offer generic examples of the 
type of “discretionary [activities] proposed to be carried out or 
approved by public agencies” to which CEQA could apply.  
CEQA does apply only to activities that qualify as projects — 
in other words, to specific examples of the listed activities that 
have the potential to cause, directly or indirectly, a physical 
change in the environment. 
UMMP has not suggested any reason why the ordinary 
presumption requiring a defined term to carry that meaning 
should not apply in these circumstances, and we aware of none.  
As noted, the definition in section 21065 is legislatively 
mandated to apply to section 21080, as well as to the 
remainder of CEQA.  (§ 21060.)  Nothing in section 21080 
suggests that the Legislature intended to exempt the listed 
activities from satisfying the requirements for a project.  On 
the contrary, its use of the defined term “project,” rather than a 
generic term such as “activity,” suggests that the Legislature 
intended to incorporate the defined concept.  Finally, using the 
defined meaning does not result in an absurdity or otherwise 
impair the enforcement of CEQA.  It simply confirms that the 
public agency activities listed in section 21080 must satisfy the 
same requirement applicable to nonlisted activities before they 
are subject to CEQA, the requirement of potential for physical 
change in the environment.  (See § 21065.) 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
22 
Because the plain language of section 21080 is 
unambiguous when evaluated in context, it is unnecessary for 
us to consider other indicia of meaning.  Yet it is worth noting 
that other available indicia support our interpretation.  First 
and most important, as the Court of Appeal recognized, our 
interpretation is consistent with that of the Secretary for 
Natural Resources in the Guidelines, to which we must “afford 
great weight.”  (Building Industry, supra, 62 Cal.4th at p. 381.)  
In defining “project,” the Guidelines impose the requirement of 
a potential for causing a physical change in the environment 
on all public agency activities.  (Guidelines, § 15378, subd. (a).)  
Although Guidelines section 15378 mentions enactment and 
amendment of a zoning ordinance, activities also mentioned in 
section 21080, it cites those activities merely as examples of 
activities “directly undertaken by any public agency” (§ 15378, 
subd. (a)(1)), a usage equivalent to our understanding of the 
significance of the list of activities in section 21080.  Guidelines 
section 15378 does not suggest that the enactment or 
amendment of a zoning ordinance constitutes a project without 
regard to its potential for causing environmental change. 
Policy considerations favor this interpretation as well.  
Finding a proposed activity subject to CEQA can lead to 
additional costs, in time and money, for both a public agency 
and a private applicant.  (Sky Ranch Pilots, supra, 47 Cal.4th 
902, 909.)  As section 21065 recognizes, there is no reason to 
impose those costs by subjecting a proposed activity to CEQA if 
the activity does not have the potential to affect the 
environment.  Declaring all of the activities listed in section 
21080 to be a project would necessarily subject them to these 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
23 
incremental costs without regard to their potential for causing 
an environmental impact. 
The legislative history of sections 21065 and 21080 also 
supports our conclusion.  As originally enacted, section 21065 
defined “project” merely as an activity undertaken, financed or 
subject to approval by a government agency, using the text 
now contained in subdivisions (a) through (c) of the statute.  
(Stats. 1972, ch. 1154, § 1, pp. 2271-2272.)  The statute did not 
contain the further requirement that a proposed activity have 
the potential to cause environmental change.  At that time, 
section 21080, subdivision (a) was materially identical to its 
present text.  (Stats. 1972, ch. 1154, § 1, p. 2272.)  Accordingly, 
the local government activities listed in section 21080 
necessarily constituted examples of “projects,” since all land 
use regulations and approvals constituted projects under the 
version of section 21065 in effect at the time.8  In 1994, section 
21065 was amended to its present form, limiting “projects” to 
governmental activities that posed the possibility of an 
environmental effect.  (Stats. 1994, ch. 1230, § 4, p. 7682.)  The 
purpose of the amendment was to “prohibit CEQA from being 
used to delay or kill [activities] that have no direct or indirect 
effect on the environment” by narrowing the definition of 
project.  (Assem. Natural Resources Com., Republican Analysis 
of Sen. Bill No. 749 (1993-1994 Reg. Sess.) Aug. 22, 1994, p. 1.)  
                                        
8  
The significance of the list in section 21080 was 
presumably to classify the activities as “discretionary” projects, 
which made them ineligible for the ministerial exemption 
under section 21080, subdivision (b). 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
24 
To continue to treat all of the activities listed in section 21080 
as “projects” following this amendment of section 21065, 
regardless of their potential for producing an environmental 
change, would entirely defeat the narrowing purpose of the 
amendment, at least as far as the listed activities are 
concerned. 
The Rominger court, in holding that section 21080 
declared all tentative subdivision map approvals to be projects, 
explained its reasoning in part by noting, “Presumably no one 
goes to the trouble of subdividing property just for the sake of 
the process; the goal of subdividing property is to make that 
property more useable.  And with the potential for greater or 
different use comes the potential for environmental impacts 
from that use.”  (Rominger, supra, 229 Cal.App.4th at p. 702.)  
Even assuming this to be true with respect to tentative 
subdivision maps, the rationale supports Rominger’s statutory 
interpretation only if the same logic also holds for the other 
public agency activities listed in section 21080.  It does not.  As 
amici curiae League of California Cities and California State 
Association of Counties point out, many types of local 
government regulations are labeled “zoning ordinances,” 
covering a wide range of regulatory subjects.  Whether the 
enactment or amendment of a regulation denominated a 
“zoning ordinance” carries the potential for environmental 
change depends entirely on the nature of the particular 
regulation.  A potential environmental effect cannot be 
presumed solely from the label applied to it.  The same point 
applies with equal force to the two other activities listed in 
section 21080, zoning variances and conditional use permits.  
Neither can reliably be presumed to have the potential to 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
25 
create environmental change.  To subject such activities to 
CEQA as a matter of course serves no obvious public policy 
purpose. 
It might be objected that this interpretation of section 
21080, subdivision (a), strips the provision of its legal 
significance, rendering it surplusage (e.g., Berkeley Hillside, 
supra, 60 Cal.4th 1086, 1097 [we should avoid “interpretations 
that render any language surplusage”]), but that argument 
misunderstands the significance of section 21080 within 
CEQA.  Section 21080, subdivision (a) establishes that CEQA 
applies to activities proposed to be carried out or approved by a 
public agency that are (1) discretionary and (2) satisfy the 
requirements for a project.  This limitation to activities 
requiring the exercise of agency discretion is not otherwise 
reflected in CEQA, at least as stated in the affirmative.  The 
only other statutory reference occurs by negative inference 
from the exemption for ministerial activities, which are defined 
as activities not requiring an agency’s exercise of discretion.  
(Sierra Club, supra, 11 Cal.App.5th at pp. 19-20.)  Not by 
coincidence, this exemption is contained in subdivision (b)(1) of 
section 21080, the subdivision immediately following the 
statute’s reference to “discretionary projects.”9  Because it 
establishes the requirement of discretionary agency action, 
section 21080, subdivision (a) retains a legal significance 
                                        
9  
As originally enacted, section 21080 consisted of the 
present text of subdivision (a) and a single exemption, the 
ministerial exemption, which was codified as subdivision (b).  
(Stats. 1972, ch. 1154, § 1, p. 2272.) 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
26 
independent of its purported classification of the agency 
activities it specifies. 
UMMP relies on Rominger, supra, 229 Cal.App.4th 690, 
in arguing that our decision in Muzzy Ranch, supra, 41 Cal.4th 
372, dictates the conclusion that section 21080 declares the 
listed public agency activities to be a project as a matter of law.  
Again, we do not agree.  Muzzy Ranch did not address, or even 
purport to consider, the question before us.  Because the 
activity of concern in Muzzy Ranch was a local agency’s 
approval of a land use compatibility plan (Muzzy Ranch, at 
p. 378), an activity not mentioned in section 21080, we had no 
reason to construe that statute, and the decision mentions 
section 21080 only once, in a general discussion of statutory 
exemptions.  (Muzzy Ranch, at p. 380.)  Muzzy Ranch is in no 
way binding in the present circumstances.10 
We recognize that the Muzzy Ranch observation cited by 
Rominger, “[w]hether an activity constitutes a project subject 
to CEQA is a categorical question respecting whether the 
activity is of a general kind with which CEQA is concerned,” 
may be interpreted to suggest that certain types of activities 
can be considered projects as a matter of law.  (Muzzy Ranch, 
supra, 41 Cal.4th at p. 381, italics added.)  Yet the decision 
does not so state.  Other than its particular choice of phrase, 
                                        
10  
For reasons stated in the text, we disapprove Rominger v. 
County of Colusa, supra, 229 Cal.App.4th 690, to the extent it 
holds that the various public agency activities listed in section 
21080, subdivision (a), are conclusively declared to be CEQA 
projects. 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
27 
there is no indication in Muzzy Ranch that the description of 
the project decision as a “categorical question” was intended to 
imply that entire categories of local governmental activities 
may be deemed projects, without consideration of their 
individual substance.  Instead, as discussed further below, that 
characterization was intended to convey the relatively abstract 
and preliminary nature of the project decision. 
C.  Whether the Ordinance Is the Sort of Activity 
That May Cause a Direct or Indirect Physical 
Change in the Environment 
Because we conclude that section 21080 does not declare 
every zoning amendment to be a CEQA project as a matter of 
law, we must, like the Court of Appeal, review the City’s 
conclusion that the Ordinance did not qualify as a project 
under section 21065.  On this issue, we part ways with the 
Court of Appeal. 
The 
governing 
decision 
is 
Muzzy 
Ranch, 
supra, 
41 Cal.4th 372.  The lead agency in Muzzy Ranch was a Solano 
County commission (commission) established to regulate land 
uses associated with county airports.  (Id. at p. 378.)  The 
activity of concern was the commission’s adoption of the Travis 
Air Force Base land use compatibility plan (TALUP), which set 
out model land use policies for portions of the county 
neighboring the military air base.  The policies were designed 
“ ‘to ensure that future land uses in the surrounding area will 
be compatible with the realistically foreseeable, ultimate 
potential aircraft activity at the base.’ ”  (Ibid.)  The Muzzy 
Ranch plaintiff was particularly concerned with the TALUP’s 
model policy for a 600-square-mile area exposed to low altitude 
overflights by aircraft using the base.  The policy, which did 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
28 
not apply to developed areas within existing city limits, 
“purport[ed] to restrict residential development within [areas 
subject to overflights] to levels currently permitted under 
existing general plans and zoning regulations.  Specifically, the 
TALUP state[d] that ‘[n]o amendment of a general plan land 
use policy or land use map designation and no change of zoning 
shall be permitted if such amendment or change would allow 
more dwelling units in the affected area than are allowed 
under current zoning.’ ”  (Muzzy Ranch, at p. 379.) 
In approving the TALUP, the commission initially 
adopted a resolution finding that the approval was not a 
project under CEQA because the TALUP would not cause a 
direct or reasonably foreseeable indirect physical change in the 
environment.  (Muzzy Ranch, supra, 41 Cal.4th at p. 378.)  
Five days later, the commission also adopted a CEQA notice of 
exemption, finding that the TALUP’s adoption “created ‘[n]o 
possibility of significant effect on the environment.’ ”  (Id. at 
p. 379.)  Muzzy Ranch reviewed both the commission’s 
conclusion that TALUP’s approval was not a project and its 
finding that, if a project, the approval was exempt from 
environmental review. 
As noted above, we began our discussion of the TALUP’s 
status as a project by observing, “Whether an activity 
constitutes a project subject to CEQA is a categorical question 
respecting whether the activity is of a general kind with which 
CEQA is concerned, without regard to whether the activity will 
actually have environmental impact.”  (Muzzy Ranch, supra, 
41 Cal.4th at p. 381.)  Because there was no question the 
commission’s approval satisfied section 21065’s requirement of 
public agency involvement, we addressed only “whether the 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
29 
Commission’s adoption of the TALUP is the sort of activity 
that may cause a direct physical change or a reasonably 
foreseeable indirect physical change in the environment.”  
(Muzzy Ranch, at p. 382.) 
On this issue, the plaintiff contended that the TALUP’s 
limitation of development in the relevant area to existing 
approved levels could cause intensified development in other 
parts of the county, a phenomenon referred to as “displaced 
development.”  (Muzzy Ranch, supra, 41 Cal.4th at p. 382.)  
The commission responded that such effects were “inherently 
too speculative to be considered a reasonably foreseeable effect 
of an airport land use compatibility plan.”  (Ibid.)  We began 
our analysis by recognizing that “no California locality is 
immune from the legal and practical necessity to expand 
housing due to increasing population pressures.”  (Id. at 
p. 383.)  Given this expectation of growth, we reasoned that a 
local agency “may reasonably anticipate that its placing a ban 
on development in one area of a jurisdiction may have the 
consequence, notwithstanding existing zoning or land use 
planning, of displacing development to other areas of the 
jurisdiction.”  (Ibid.)  On that reasoning alone, we held that the 
TALUP’s approval might cause a reasonably foreseeable 
indirect physical change in the environment and therefore 
constituted a project.  (Ibid.) 
Our analysis of the commission’s notice of exemption was 
quite different.  In finding the TALUP exempt from 
environmental 
review, 
the 
commission 
relied 
on 
the 
“commonsense” exemption of the Guidelines, which applies 
“[w]here it can be seen with certainty that there is no 
possibility that the activity in question may have a significant 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
30 
effect on the environment.”  (Guidelines, § 15061, subd. (b)(3).)  
In contrast to the decision under section 21065, which we 
treated as an issue of law, Muzzy Ranch held that the TALUP’s 
eligibility for the commonsense exemption “presents an issue of 
fact, and . . . the agency invoking the exemption has the 
burden of demonstrating it applies.”  (Muzzy Ranch, supra, 
41 Cal.4th at p. 386.)  Applying this standard of review, we 
held 
that 
the 
commission 
correctly 
found 
that 
the 
commonsense 
exemption 
applied, 
notwithstanding 
our 
conclusion that the TALUP’s possible environmental impact 
was sufficient to require its treatment as a project.  As we 
reasoned, “When approving a project that is consistent with a 
community plan, general plan, or zoning ordinance for which 
an environmental impact report already has been certified, a 
public agency need examine only those environmental effects 
that are peculiar to the project and were not analyzed or were 
insufficiently analyzed in the prior environmental impact 
report.”  (Id. at pp. 388-389.)  In restricting growth in areas of 
the county affected by overflights, the TALUP merely 
incorporated limits already imposed by existing general plan 
and zoning provisions.  (Id. at p. 389.)  As a result, “any 
potential displacement the TALUP might otherwise have 
effected already has been caused by the existing land use 
policies and zoning regulations to which the TALUP is keyed.”  
(Ibid.) 
 Under 
Muzzy 
Ranch, 
a 
local 
agency’s 
task 
in 
determining whether a proposed activity is a project is to 
consider the potential environmental effects of undertaking the 
type of activity proposed, “without regard to whether the 
activity will actually have environmental impact.”  (Muzzy 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
31 
Ranch, supra, 41 Cal.4th at p. 381.)  Applying this test, our 
discussion of the TALUP’s status as a project was brief and 
straightforward.  We made no reference to any evidence in the 
record bearing on the actual impact of the TALUP on 
development in Solano County.  Instead, the decision restricted 
itself to an examination of the potential effects that could 
reasonably be anticipated from adopting a land use policy of 
the type contained in the TALUP.  Reasoning that population 
growth and resulting development can be anticipated in 
California counties, and that a policy capping development in 
one area might be expected to divert this growth to other areas 
of a county, we found the TALUP to be the sort of activity that 
could result in a physical change in the environment.  (Id. at 
p. 383.) 
To encapsulate the Muzzy Ranch test, a proposed activity 
is a CEQA project if, by its general nature, the activity is 
capable of causing a direct or reasonably foreseeable indirect 
physical change in the environment.  This determination is 
made without considering whether, under the specific 
circumstances in which the proposed activity will be carried 
out, these potential effects will actually occur.  Consistent with 
this standard, a “reasonably foreseeable” indirect physical 
change is one that the activity is capable, at least in theory, of 
causing.  (Guidelines, § 15064, subd. (d)(3).)  Conversely, an 
indirect effect is not reasonably foreseeable if there is no causal 
connection between the proposed activity and the suggested 
environmental change or if the postulated causal mechanism 
connecting the activity and the effect is so attenuated as to be 
“speculative.”  (Ibid.; e.g., City of Livermore v. Local Agency 
Formation 
Com. 
(1986) 
184 
Cal.App.3d 
531, 
541-543 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
32 
[amendment of local agency formation commission guidelines 
to permit urban development outside cities constitutes a 
project]; Kaufman & Broad-South Bay, Inc. v. Morgan Hill 
Unified School Dist. (1992) 9 Cal.App.4th 464, 474 [creation of 
a Mello-Roos district for the purposes of funding an anticipated 
future school system in an undeveloped portion of the city not a 
project because “the causal link between the [formation of the 
district] and the alleged environmental impact (construction of 
new schools) is missing”].) 
The somewhat abstract nature of the project decision is 
appropriate to its preliminary role in CEQA’s three-tiered 
decision tree.  Determination of an activity’s status as a project 
occurs at the inception of agency action, presumably before any 
formal inquiry has been made into the actual environmental 
impact of the activity.  The question posed at that point in the 
CEQA analysis is not whether the activity will affect the 
environment, or what those effects might be, but whether the 
activity’s potential for causing environmental change is 
sufficient to justify the further inquiry into its actual effects 
that will follow from the application of CEQA.  If the proposed 
activity is the sort that is capable of causing direct or 
reasonably foreseeable indirect effects on the environment, 
some type of environmental review is justified, and the activity 
must be deemed a project.  CEQA analysis is then undertaken 
to evaluate the likelihood and nature of the project’s 
environmental impacts, in order to determine the extent of 
environmental review required. 
Only as so understood is the nature of the project 
decision consistent with the scope of appellate review.  As 
noted, we evaluate that decision as a question of law, rather 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
33 
than fact, to be decided on “undisputed data in the record on 
appeal.”  (Muzzy Ranch, supra, 41 Cal.4th at p. 382; see San 
Mateo Gardens, supra, 1 Cal.5th at p. 952 [whether an activity 
constitutes a project under CEQA is “a predominantly legal 
question”].)  Given the often disputed nature of the real-world 
environmental impacts of a typical project and the discretion 
invested in an agency to make related factual findings, the 
environmental effects of a proposed activity can be reviewed as 
a matter of law only if the analysis is restricted to the effects 
that the activity is capable of causing, rather than those it 
actually will cause if implemented. 
Our understanding of Muzzy Ranch is therefore 
somewhat different from Rominger’s understanding, which 
UMMP urges here.  UMMP argues that Muzzy Ranch’s 
reference to “a categorical question respecting whether the 
activity is of a general kind with which CEQA is concerned” 
(Muzzy Ranch, supra, 41 Cal.4th at p. 381) makes it 
unnecessary to consider the substance of a proposed activity.  
Instead, UMMP argues, it is sufficient to know the nature of 
the agency action involved — for example, approval of a zoning 
amendment or of a permit for private land development.  On 
the contrary, as our discussion demonstrates, Muzzy Ranch 
clearly requires a public agency to consider the substance of a 
proposed activity in determining its status as a project.  What 
need not be considered is the activity’s actual impact in the 
specific circumstances presented.  As Muzzy Ranch noted, the 
analysis is conducted “without regard to whether the activity 
will actually have environmental impact.”  (Ibid., italics 
added.)  Similarly irrelevant is the specific type of 
governmental action required, so long as the proposed activity 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
34 
satisfies one of the criteria for governmental involvement 
established in section 21065, subdivisions (a) through (c).11 
Applying the foregoing test, we conclude the City erred in 
determining that the adoption of the Ordinance was not a 
project.  Prior to the Ordinance, no medical marijuana 
dispensaries were legally permitted to operate in the City.  The 
Ordinance therefore amended the City’s zoning regulations to 
permit the establishment of a sizable number of retail 
businesses of an entirely new type.  Although inconsistency 
with prior permissible land uses is not necessary for an activity 
to constitute a project (see Muzzy Ranch, supra, 41 Cal.4th at 
p. 388), establishment of these new businesses is capable of 
causing indirect physical changes in the environment.  At a 
minimum, such a policy change could foreseeably result in new 
retail construction to accommodate the businesses.  In 
addition, as UMMP suggests, the establishment of new stores 
could cause a citywide change in patterns of vehicle traffic 
from the businesses’ customers, employees, and suppliers.  The 
necessary causal connection between the Ordinance and these 
effects is present because adoption of the Ordinance was “an 
essential step culminating in action [the establishment of new 
                                        
11  
The characterization of the project decision in Muzzy 
Ranch as a “categorical question” derives from the description 
of the relevant question as whether “the activity is of a general 
kind with which CEQA is concerned.”  (Muzzy Ranch, supra, 
41 Cal.4th at p. 381, italics added.)  Given the demonstrated 
potential for confusion in using the term, however, we now 
refrain from characterizing the project decision as a 
“categorical question.”  This will also avoid any confusion with 
“categorical exemptions,” an unrelated concept. 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
35 
businesses] which may affect the environment.”  (Fullerton 
Joint Union High School Dist. v. State Board of Education 
(1982) 32 Cal.3d 779, 797 (Fullerton).)  The theoretical effects 
mentioned above are sufficiently plausible to raise the 
possibility that the Ordinance “may cause . . . a reasonably 
foreseeable indirect physical change in the environment” 
(§ 21065), warranting its consideration as a project. 
Although UMMP raised these potential effects in the 
Court of Appeal, as well as other, less plausible effects, it 
framed them in the context of the specific circumstances it 
claimed to prevail in the City, hypothesizing various City-
specific reasons why the Ordinance might indirectly produce 
physical changes.  The Court of Appeal understandably 
rejected these specific impacts as speculative, given the 
absence of any evidence to support their occurrence.  For the 
reasons discussed above, however, both UMMP’s framing of 
the arguments in this manner and the court’s rejection of them 
put the cart before the horse.  The likely actual impact of an 
activity is not at issue in determining its status as a project.12  
                                        
12  
The Court of Appeal misunderstood its task in reviewing 
the City’s decision.  Although the court noted Muzzy Ranch’s 
characterization of the project decision as requiring a 
“categorical approach,” it ultimately described the required 
analysis in a very different way.  Quoting Wal-Mart Stores, Inc. 
v. City of Turlock (2006) 138 Cal.App.4th 273, 290-291, the 
court held, “ ‘The correct analysis of the relevant physical 
change in the environment involves a comparison of (1) the 
physical conditions that existed at the time the Ordinance was 
proposed or approved with (2) forecasts of reasonably 
foreseeable future conditions that may occur as a result of the 
adoption of the Ordinance.’ ”  (Marijuana Patients, supra, 
 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
36 
Further, at this stage of the CEQA process virtually any 
postulated indirect environmental effect will be “speculative” 
in a legal sense — that is, unsupported by evidence in the 
record (e.g., People v. Murtishaw (2011) 51 Cal.4th 574, 591 
[“defendant’s claim . . . is entirely speculative, for he points to 
nothing in the record that supports his claim”]) — because 
little or no factual record will have been developed.  A lack of 
support in the record, however, does not prevent an agency 
from considering a possible environmental effect at this initial 
stage of CEQA analysis.  Instead, such an effect may be 
rejected as speculative only if, as noted above, the postulated 
causal mechanism underlying its occurrence is tenuous. 
Finally, the City argues, in passing, that environmental 
review would be more appropriate at the time each dispensary 
applies for a conditional use permit, which is required by the 
Ordinance for operation of a dispensary.  We withhold 
comment on the significance of this argument for tiers two and 
three of the CEQA decision tree, but we note that the 
requirement of individual use permits does not prevent the 
Ordinance from being considered a project if section 21065 is 
otherwise satisfied.  As we observed in Fullerton, supra, 
                                                                                                           
 
4 Cal.App.5th 103, 120.)  The test quoted from Wal-Mart, 
however, was not intended to govern the project decision but 
instead concerned the application of Guidelines section 15183, 
which permits “a streamlined environmental review for 
qualifying projects that are consistent with a general plan for 
which an EIR was certified.”  (Wal-Mart, supra, at p. 286; see 
id. at pp. 286-288.)  The project decision never arose in Wal-
Mart because the court assumed that the activity under 
consideration was a project.  (Id. at p. 286.) 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
37 
32 Cal.3d at page 795, a local agency “cannot argue” that 
approval of a regulation is not a project “merely because 
further decisions must be made” before the activities directly 
causing environmental change will occur.  The City argues that 
too little is known about the environmental impact of the 
Ordinance to permit effective environmental review at this 
stage, but that argument conflates the various tiers of CEQA 
review.  (Muzzy Ranch, supra, 41 Cal.4th at p. 383 [“That 
further governmental decisions need to be made before a land 
use measure’s 
actual 
environmental 
impacts 
can 
be 
determined with precision does not necessarily prevent the 
measure from qualifying as a project”].)  At this initial tier in 
the CEQA process, the potential of the Ordinance to cause an 
environmental change requires the City to treat it as a project 
and proceed to the next steps of the CEQA analysis. 
It ultimately might prove true that, in the context of the 
City, the actual environmental effects of the Ordinance will be 
minimal.  It is possible, as the Court of Appeal assumed, that 
the City’s commercial vacancy rate is sufficient to provide 
retail space for the new businesses without the need for 
expansion.  (Marijuana Patients, supra, 4 Cal.App.5th at 
p. 123 [dispensaries “could simply cho[o]se to locate in 
available commercial space in an existing building”].)  It is also 
possible, as UMMP suggests, that a significant number of 
unlicensed businesses selling medical marijuana already exist 
in the City and that the newly licensed businesses will simply 
displace them.  Rather than causing increased traffic and other 
activity, the net effect of this substitution might be little or no 
additional environmental burden on the City.  All of these 
factors can be explored in the second and, if warranted, third 
UNION OF MEDICAL MARIJUANA PATIENTS, INC.,  
v. CITY OF SAN DIEGO 
Opinion of the Court by Cantil-Sakauye, C. J. 
 
38 
tiers of the CEQA process.  As to those tiers, we are in no 
position to offer, and do not express, an opinion on the 
applicability of the various exemptions or, alternatively, the 
appropriate level of environmental review. 
III.  DISPOSITION 
The judgment of the Court of Appeal is reversed.  That 
court is directed to vacate the order of the superior court 
denying a writ of mandate and to remand the case to the trial 
court for further proceedings consistent with this opinion. 
 
CANTIL-SAKAUYE, C. J. 
 
We Concur: 
CHIN, J. 
CORRIGAN, J. 
LIU, J. 
CUÉLLAR, J. 
KRUGER, J. 
GROBAN, J.
 
 
See next page for addresses and telephone numbers for counsel who argued in Supreme Court. 
 
Name of Opinion Union of Medical Marijuana Patients, Inc. v. City of San Diego 
__________________________________________________________________________________ 
 
Unpublished Opinion 
Original Appeal 
Original Proceeding 
Review Granted XXX 4 Cal.App.5th 103 
Rehearing Granted 
 
__________________________________________________________________________________ 
 
Opinion No. S238563 
Date Filed: August 19, 2019 
__________________________________________________________________________________ 
 
Court: Superior 
County: San Diego 
Judge: Joel R. Wohlfeil 
 
__________________________________________________________________________________ 
 
Counsel: 
 
Channel Law Group, Jamie T. Hall and Julian Killen Quattlebaum for Plaintiff and Appellant. 
 
Jan I. Goldsmith and Mara W. Elliott, City Attorneys, George F. Schaefer, Assistant City Attorney, Glenn 
T. Spitzer and M. Travis Phelps, Deputy City Attorneys, for Defendant and Respondent. 
 
Best Best & Krieger, Michelle Ouellette, Charity Schiller and Sarah E. Owsowitz for League of California 
Cities and California State Association of Counties as Amici Curiae on behalf of Defendant and 
Respondent. 
 
No appearance for Real Party in Interest. 
 
 
 
 
 
 
 
 
 
 
 
Counsel who argued in Supreme Court (not intended for publication with opinion): 
 
Jamie T. Hall 
Channel Law Group 
8383 Wilshire Boulevard, Suite 750 
Beverly Hills, CA  90211 
(310) 982-1760 
 
Julian K. Quattlebaum 
Channel Law Group 
8383 Wilshire Boulevard, Suite 750 
Beverly Hills, CA  90211 
(310) 982-1760 
 
M. Travis Phelps 
Deputy City Attorney 
Office of the City Attorney 
1200 Third Avenue, Suite 1100 
San Diego, CA  92101-4100 
(619) 533-5800