Opinion ID: 2631711
Heading Depth: 1
Heading Rank: 1

Heading: factual, legal and procedural background

Text: Fort Ord is a former United States Army base on the Pacific Coast, about five miles north of Monterey and 125 miles south of San Francisco. The base lies on the northern end of Monterey Bay, an important tourist destination known for its scenic beauty and historic sites. In 1994, the Department of Defense formally closed the base and transferred 27,000 acres (over 42 square miles) to a variety of governmental entities and local organizations. The closure created both problems and opportunities for the region. On one hand, the loss of one of the nation's largest military installations threatened to disrupt the local economy. On the other hand, valuable land that for over 75 years had been exclusively controlled by the Army became available for civilian economic development. To provide a government for the former base and to manage its transition to civilian use, the Legislature enacted the Fort Ord Reuse Authority Act (Gov.Code, § 67650 et seq.) (hereafter the FORA Act or the act). Effective May 9, 1994, the act authorized FORA's creation and conferred upon it governmental powers and duties within the former base that prevail over those of any other local governmental entity. ( Id., § 67657, subd. (c).) FORA's general statutory purpose is to plan for, finance, and carry out the transfer and reuse of the base in a cooperative, coordinated, balanced, and decisive manner. (Gov.Code, § 67652, subd. (a).) The act also charges FORA with the more specific policy goals of facilitat[ing] the transfer and reuse of the real and other property [of the base] . . . with all practical speed, minimiz[ing] the disruption caused by the base's closure on the civilian economy and the people of the Monterey Bay area, maintain[ing] and protect[ing] the unique environmental resources of the area, and accomplishing these tasks in ways that enhance the economy and quality of life of the Monterey Bay community. ( Id., § 67651, subds. (a)-(d).) The 13 members of FORA's governing board are appointed by local governments neighboring the baseMonterey County and the Cities of Carmel, Del Rey Oaks, Marina, Monterey, Pacific Grove, Salinas, Sand City and Seaside. ( Id., § 67660.) Also on the board are 10 ex officio, nonvoting members, including one appointed by the Chancellor of the California State University. ( Id., § 67661.) The charter for Fort Ord's future use and development is the statutorily mandated Base Reuse Plan (hereafter Reuse Plan), which FORA adopted on June 13, 1997. (See Gov.Code, § 67675 et seq.) The plan addresses land use, transportation, conservation, recreation and capital improvement in Fort Ord until the year 2015. (See id., § 67675, subd. (c).) Pursuant to the plan, FORA will make land available over time for a wide range of civilian uses, including residential housing, business, light industry, research and development, visitor services, recreation and education. All such development will require improvements to the infrastructure the Army left behind. Recognizing this, the Legislature gave FORA the power and duty to prepare the base's infrastructure for civilian development. In the words of the act, FORA shall identify those basewide public capital facilities . . . that serve residents or will serve future residents of the base territory (Gov.Code, § 67679, subd. (a)(1)) and shall undertake to plan for and arrange the provision of those facilities, including arranging for their financing and construction or repair, remodeling, or replacement ( ibid.; see also id., § 67675, subd. (c)(5) [Reuse Plan must include capital improvement plan]). FORA has, as the Legislature directed, prepared a capital improvement plan identifying public facilities that need construction or improvement and projecting future expenditures for that purpose through the year 2015. (See Gov.Code, § 67675, subd. (c)(5).) The facilities FORA has identified include elements of Fort Ord's infrastructure for transportation (mainly roadways), water supply and distribution, wastewater management, drainage, and fire protection, among other things. FORA plans to improve these facilities over the life of the Reuse Plan, as increasing land use necessitates the improvements and as funding becomes available. Funding is not expected to come through legislative appropriations. Instead, the Legislature has directed FORA to arrange its own financing as it sees fit (Gov.Code, § 67679, subd. (a)(1)), employing any of several funding methods authorized in the FORA Act. FORA may, for example, levy assessments, reassessments, or special taxes and issue bonds under existing laws governing public finance ( id., § 67679, subd. (d)), [1] levy development fees on development projects within the area of the base ( id., § 67679, subd. (e)) pursuant to the Mitigation Fee Act ( id., § 66000 et seq.), sell or lease land ( id., § 67678, subd. (a)), and seek state and federal grants and loans or other assistance ( id., § 67679, subd. (c)). FORA and its local-government member agencies ( id., § 67660) may also provide by contract for the transfer of tax revenues ( id., § 67691) and/or adopt programs of local revenue sharing ( id., § 67692). In order to determine the long-term financial viability of the Reuse Plan, FORA has prepared a Comprehensive Business Plan setting out assumptions about projected revenue and expenditures. As part of this exerciseone obviously subject to numerous contingencies given the long planning horizonFORA has projected that it will spend $249.2 million to improve Fort Ord's infrastructure over the 20-year life of the Reuse Plan, i.e., from 1996 to 2015. FORA projects that the largest part of its operational revenue over the same period will derive from the sale of land and from a one-time special tax under the Mello-Roos Community Facilities Act of 1982 (Gov.Code, § 53311 et seq.). Other revenue is expected to come through local development fees, water and sewer fees, a grant from the federal Economic Development Administration, and the annual dues of FORA's members. The California State University (CSU) is the largest university system in the United States. Governed by the Trustees, CSU's 23 campuses across the state collectively enroll 405,000 students and employ 44,000 faculty and staff. CSU Monterey Bay (CSUMB), which occupies 1,370 acres transferred by the Army to CSU in 1994, is presently the main user of the base. CSUMB opened in 1995 with 633 students, using existing military buildings, and now enrolls approximately 3,800 students, 2,600 of whom live on campus. From this modest beginning the Trustees plan to expand enrollment at CSUMB greatly over the next few decades, eventually reaching the target enrollment of 25,000 full-time equivalent (FTE [2] ) students in the year 2030. On May 13, 1998, the Trustees approved a Campus Master Plan (hereafter Master Plan) to guide CSUMB toward this target. Under the Master Plan, CSUMB's resident population of students, faculty, staff and household members would gradually increase to 10,350. The campus's average daily population, which also includes students who commute, would grow to 19,000. Together with the Master Plan for CSUMB, the Trustees also prepared and certified an EIR. The EIR is the focus of the environmental review process and, as we have explained, the primary means of achieving the state's declared policy of taking `all action necessary to protect, rehabilitate, and enhance the environmental quality of the state.' ( Laurel Heights Improvement Assn. v. Regents of University of California (1988) 47 Cal.3d 376, 392, 253 Cal.Rptr. 426, 764 P.2d 278, quoting Pub. Resources Code, § 21000, subd. (a); see also CEQA Guidelines, [3] § 15003, subd. (a).) The EIR's more specific purposes are to identify the significant effects on the environment of a project, to identify alternatives to the project, and to indicate the manner in which those significant effects can be mitigated or avoided. (Pub. Resources Code, § 21002.1, subd. (a).) CEQA expressly requires that an EIR accompany the Master Plan for CSUMB. The selection of a location for a particular campus and the approval of a long range development plan are subject to [CEQA] and require the preparation of an [EIR]. ( Id., § 21080.09, subd. (b).) The Trustees necessarily serve as the lead agency ( id., § 21067) responsible for preparing and certifying the EIR ( id., § 21100, subd. (a)) because they possess full power and responsibility in the construction and development of any state university campus (Ed.Code, § 66606) and thus final authority to approve or disapprove the Master Plan. In their EIR for CSUMB, the Trustees have determined that expanding CSUMB to accommodate 25,000 students will have many significant effects on the physical environment of Fort Ord. CEQA requires [e]ach public agency [to] mitigate or avoid the significant effects on the environment of projects that it carries out or approves whenever it is feasible to do so (Pub. Resources Code, § 21002.1, subd. (b)) and to discuss feasible methods of mitigation in the EIR ( id., § 21100, subd. (b)(3); CEQA Guidelines, § 15126.4, subd. (a)(1); see also Pub. Res.Code, § 21002.1, subd. (a) [one purpose of the EIR is to indicate the manner in which . . . significant effects can be mitigated or avoided].) In fact, the Trustees' EIR does identify and adopt specific measures that the Trustees have found will mitigate most of the environmental effects of campus expansion to a level that is less than significant. Full mitigation of five remaining effects, however, will require action not just by the Trustees on the CSUMB campus but also by FORA on a basewide or regional basis. These remaining effects have become the subject of this litigation. The Trustees' EIR describes the five remaining environmental effects, for which the Trustees have not provided full mitigation, as follows: (1) Drainage: Construction of new buildings and facilities will increase impervious surfaces and runoff, and could result in localized drainage problems and/or flows exceeding storm drain capacities, if storm drainage facilities are not adequately sized and maintained. (2) Water supply: CSUMB water demand will contribute incremental demands on existing deficient facilities and/or non-existent facilities. (3) Traffic: Campus-related traffic will result in a decrease in level of service from D to E [ [4] ] at the [Light Fighter] Drive/North-South Road intersection [ [5] ] during the PM peak period in the year 2005, from D to E along Del Monte Blvd. between Reindollar [Avenue] and Reservation Road [ [6] ] in the years 2005 and 2015, and will contribute to Highway 1 impacts in the years 2015 and 2030. (4) Wastewater management: Campus growth will result in increased wastewater generation that can be accommodated by the existing wastewater treatment system, but will contribute flows to currently deficient sewer lines. (5) Fire protection: Campus population and facility growth will result in increased demand for fire protection services. Before a public agency, such as the Trustees, may approve a project for which the EIR has identified significant effects on the environment, such as the Master Plan for CSUMB, the agency must make one or more of the findings required by section 21081 of the Public Resources Code. The required findings constitute the principal means chosen by the Legislature to enforce the state's declared policy that public agencies should not approve projects as proposed if there are feasible alternatives or feasible mitigation measures available which would substantially lessen the significant environmental effects of such projects. . . . ( Id., § 21002; see also id., § 21002.1, subd. (a).) More specifically, the agency must find that the project's significant environmental effects have been mitigated or avoided ( id., § 21081, subd. (a)(1)), that the measures necessary for mitigation are within the responsibility and jurisdiction of another public agency and have been, or can and should be, adopted by that other agency ( id., subd. (a)(2)), and/or that specific economic, legal, social, technological, or other considerations render mitigation infeasible ( id., subd. (a)(3)). When the agency finds that mitigation is infeasible, the agency must also find that specific overriding economic, legal, social, technological, or other benefits of the project outweigh the significant effects on the environment. ( Id., subd. (b).) [7] In their EIR, the Trustees have identified and adopted a variety of measures they have found will partially mitigate the five remaining environmental effects noted above. Full mitigation of these effects to the level of insignificance will, however, as the EIR specifically notes, require FORA to improve Fort Ord's infrastructure. In fact, FORA's own planning documents take the Trustees' plans for CSUMB into account and propose specific infrastructure improvements that will fully mitigate the expanding campus's remaining effects on water supply, drainage, wastewater management, traffic, and fire protection. Concerning each of these effects, the Trustees have declared in their formal findings certifying the EIR and approving the Master Plan (see Pub. Resources Code, § 21081) that the implementation of FORA's proposed improvements constitutes the specific measure to mitigate [each of CSUMB's corresponding environmental impacts] to the level of insignificance. . . . As part of its long-term planning process, FORA adopted the assumption that that CSUMB would pay, as its share of the cost of infrastructure improvements, 18 annual installments of $1.139 million each, beginning in fiscal year 1997/1998 and ending in fiscal year 2015/2016, for a total contribution over time of approximately $20.5 million. At the present time, however, FORA has not imposed any tax, fee or charge on CSUMB or proposed to do so. Instead, FORA hopes to reach agreement with the Trustees on their fair share of the cost of infrastructure improvements. The Trustees, however, have refused to contribute any amount to FORA for improvements in roads and fire protection, even while finding that FORA's proposed improvements constitute the specific measures necessary to mitigate CSUMB's effects in these areas. Accordingly, the Trustees cannot logically find and, indeed, have not found that CSUMB's effects have been fully mitigated. Instead, to justify certifying the EIR and approving the Master Plan despite the remaining, unmitigated effects, the Trustees rely on the following three alternative findings: (1) improvements to roads and fire protection are the responsibility of FORA rather than of the Trustees; (2) mitigation is infeasible because the Trustees may not legally contribute funds toward these improvements; and (3) the planned expansion of CSUMB offers overriding benefits that outweigh any remaining unmitigated effects on the environment. [8] (See Pub. Resources Code, § 21081, subds. (a)(2), (3) & (b).) While the Trustees have refused to contribute any amount for improvements in roads and fire protection, they are willing to contribute for improvements in water supply, drainage and wastewater management, albeit not in the amount FORA has proposed. Instead, the Trustees propose to contribute through the procedure set out in chapter 13.7 of the Government Code (section 54999 et seq.). Chapter 13.7 authorizes a public utility that is providing a public utility service to a public educational agency to impose a capital facilities fee on the latter after agreement has been reached between the two agencies through negotiations entered into by both parties. (Gov.Code, § 54999.3, subd. (b).) The resulting dispute over the amount of the Trustees' contribution creates uncertainty about the extent to which CSUMB's off-campus environmental effects will be mitigated. Accordingly, to justify certifying the EIR and approving the Master Plan for CSUMB, the Trustees have made alternative findings of the same type used to address CSUMB's effects on roads and fire protection. Specifically, the Trustees have found that (1) the basewide infrastructure improvements proposed by FORA constitute the specific measures necessary to mitigate CSUMB's effects to the level of insignificance, (2) the mitigation of CSUMB's effects on drainage, water supply, and wastewater management are FORA's responsibility, and (3) overriding circumstances justify certifying the EIR and approving the Master Plan despite any remaining unmitigated effects. [9] In an appendix to the EIR addressing public comments, the Trustees explain why they have refused to contribute toward improvements in roads and fire protection, and why they have agreed to contribute toward improvements in drainage, water supply and wastewater management only through the procedure established in chapter 13.7 of the Government Code (§ 54999 et seq.), even though these decisions will leave some environmental effects unmitigated. Whether the Trustees, in view of the unmitigated effects, properly exercised their discretion to certify the EIR and to approve the Master Plan for CSUMB depends in large part on whether they have correctly understood the nature and scope of their obligation to contribute to FORA. We thus briefly summarize the relevant portion of the appendix, which effectively defined the issues in the lower courts and anticipated the Trustees' arguments in the present proceeding. CSUMB's land, the Trustees observe in the appendix to the EIR, is exempt from taxation as [p]roperty owned by the State under article XIII, section 3, subdivision (a) of the California Constitution. This constitutional provision has been interpreted as implicitly immunizing state-owned property from special assessments imposed by local governments, except as authorized by the Legislature. ( San Marcos Water Dist. v. San Marcos Unified School Dist. (1986) 42 Cal.3d 154, 160-161, 228 Cal.Rptr. 47, 720 P.2d 935 ( San Marcos ).) In reaction to San Marcos, the Legislature passed a law (chapter 13.7 of the Government Code, beginning with section 54999) authorizing any public agency that provides public utility services to a public educational agency to impose a [c]apital facilities fee on the latter after agreement has been reached between the two agencies through negotiations entered into by both parties. (Gov.Code, § 54999.3, subd. (b).) This law, which addresses only fees intended to pay the capital cost of a public utility facility ( id., § 54999.1, subd. (b)), defines `[p]ublic utility facility' for these purposes as a facility for the provision of water, light, heat, communications, power, or garbage service, for flood control, drainage or sanitary purposes, or for sewage collection, treatment, or disposal ( id., subd. (d)). The FORA Act, in turn, provides that [t]he applicability of any capital facilities fees imposed under this title [i.e., the FORA Act] to public educational agencies shall be subject to the provisions of Chapter 13.7 [of the Government Code] (commencing with section 54999). . . . (Gov. Code, § 67685.) Based on these authorities, the Trustees conclude in the appendix that the Legislature has in effect authorized FORA to impose fees on CSUMB for the purposes mentioned in chapter 13.7 of the Government Code (e.g., water, drainage and sewage; see id., § 54999.1, subd.(d)) but not for any other purposes not mentioned (e.g., roads and fire protection). Any payment to FORA for a purpose not mentioned in the section, the Trustees conclude, even a voluntary payment made in order to mitigate CSUMB's environmental effects, would amount to an assessment prohibited by the state Constitution, as interpreted in San Marcos, supra, 42 Cal.3d 154, 228 Cal.Rptr. 47, 720 P.2d 935, and constitute a gift of public funds. Having thus concluded that any contribution by CSUMB to mitigate the campus's effects on roads and fire protection would be unlawful, the Trustees further conclude that to mitigate these effects is infeasible, presumably for legal reasons (see Pub. Resources Code, § 21081, subd. (a)(3)), and thus not required by CEQA because, in the Trustees' view, overriding considerations justify proceeding with the project despite the unmitigated effects (see id., § 21081, subd. (b)). A lengthy statement of overriding considerations accompanies the Trustees' findings certifying the EIR and approving the Master Plan for CSUMB. In the statement, the Trustees reiterate the requirements of CEQA, the content of the EIR, the principal features of the Master Plan for CSUMB, and favorable public comments on the EIR. The following excerpts summarize some of the considerations underlying the Trustees' conclusion that campus expansion will offer benefits that outweigh any remaining unmitigated effects on the environment: The CSU has identified the need for a university in the Monterey Bay area that addresses the projected demand for postsecondary education in the state of California by accommodating 25,000 [FTE students] at buildout. CSU recognizes official projections of future increases in the number of students to be served . . . which cannot be accommodated within [the] existing system capacity of the CSU. The reuse of Fort Ord for this purpose is particularly advantageous to the CSU because of the difficulty in acquiring campus-size parcels, the value of existing development on the site, and the attractive location of the site in the Monterey area. The master plan has been designed to provide an institution that will effectively serve the mission of the CSU system. In addition, development of the campus will offer higher education to historically underrepresented populations and cultures of the state of California, foster economic revitalization of a region impacted by closure of the largest residential military training facility in the nation and create job opportunities for approximately 2,760 faculty and staff as well as significant additional employment in university support activities. On May 13, 1998, the Trustees adopted resolutions approving the statement of overriding considerations, certifying the EIR, and approving the Master Plan for CSUMB. Thereafter, FORA and the City of Marina filed separate petitions for writ of mandate challenging the Trustees' actions. The petitions alleged, among other things, that the Trustees had (1) failed to identify and adopt existing, feasible measures to mitigate significant effects on the environment described in the EIR, (2) improperly certified the EIR and approved the Master Plan despite the availability of feasible mitigation measures, (3) improperly disclaimed responsibility for mitigating CSUMB's environmental effects, and (4) improperly relied on a statement of overriding considerations to justify certifying the EIR and approving the Master Plan. The superior court granted the petitions, issued its writ of mandate directing the Trustees to vacate their actions certifying the EIR and approving the Master Plan, and to set aside the EIR's statement of overriding considerations. A divided Court of Appeal reversed. We granted FORA's petition for review. [10]