Court Opinion

ID: 9839696
Source: CourtListenerOpinion
Date Created: 2023-09-13 19:04:13.780803+00
Date Added: 2024-06-11T09:38:24.907563
License: Public Domain

Filed 9/13/23 Historic Architecture Alliance v. City of Laguna Beach CA4/3

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                IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                     FOURTH APPELLATE DISTRICT

                                                DIVISION THREE

 HISTORIC ARCHITECTURE
 ALLIANCE et al.,
                                                                       G061671
      Plaintiffs and Appellants,
                                                                       (Super. Ct. No. 30-2021-01182450)
           v.
                                                                       OPINION
 CITY OF LAGUNA BEACH et al.,

      Defendants and Respondents,

 IAN AND CHERLIN KIRBY,

     Real Parties in Interest and
     Respondents.

                   Appeal from a judgment of the Superior Court of Orange County, Randall
J. Sherman, Judge. Affirmed.
                   Chatten-Brown, Carstens & Minteer LLP, Amy Minteer, Michelle N.
Black, and Sunjana Supekar for Plaintiffs and Appellants Historic Architecture Alliance
and Laguna Beach Historic Preservation Coalition.
              Rutan & Tucker and Philip D. Kohn for Defendants and Respondents City
of Laguna Beach and City Council of the City of Laguna Beach.
              Nokes & Quinn, LLP and Laurence P. Nokes for Real Parties in Interest
and Respondents Ian and Cherlin Kirby.
                                  *           *          *
              The Historic Architecture Alliance and the Laguna Beach Historic
Preservation Coalition (collectively, the Alliance) appeal from a judgment denying their
petition for a writ of mandamus. The action involves a decision by the City of Laguna
Beach and its City Council (collectively, the City) to approve real parties in interest Ian
Kirby and Cherlin Kirby’s (the Kirbys) application to renovate and build an extension on
an existing single-family dwelling listed in the City’s “Historic Resources Inventory.”
Because of this listing, the Kirbys’ residence is considered a presumptive historical
resource under the California Environmental Quality Act (CEQA) (Pub. Resources Code,
                    1
§ 21000 et seq.).
              “Historic resources are accorded special protection under CEQA, and the
state must ‘take all action necessary to protect, rehabilitate, and enhance the
environmental quality of the state’ including the protection and rehabilitation of ‘objects
of historic or aesthetic significance.’” (Citizens for a Sustainable Treasure Island v. City
and County of San Francisco (2014) 227 Cal.App.4th 1036, 1065 (Treasure Island).)
“‘A project that may cause a substantial adverse change in the significance of an
historical resource is a project that may have a significant effect on the environment[]’”
and “[s]uch a project would require the preparation of an environmental impact report
(EIR) or a mitigated negative declaration.” (Valley Advocates v. City of Fresno (2008)
160 Cal.App.4th 1039, 1051 (Valley Advocates).)

1
  All further statutory references are to the Public Resources Code unless otherwise
specified.

                                              2
              CEQA and the guidelines adopted to implement it (Cal. Code Regs., tit. 14,
§ 15000 et seq. (CEQA Guidelines)) allow certain exemptions from CEQA’s
environmental review requirements. Here, the City found the proposed modification to
the Kirbys’ property (the project) was categorically exempt from CEQA’s environmental
review under the “Class 31” historical resource exemption. (CEQA Guidelines,
§ 15331.) This exemption is based on the City’s factual finding the project is consistent
with the “Secretary of the Interior’s Standards for the Treatment of Historic Properties”
(the Secretary’s Standards), which has guidelines for rehabilitating historic buildings.
(Ibid.) The City made this finding despite evidence and argument from the Alliance and
others that the project does not comply with the Secretary’s Standards.
              Once it has been determined a project meets the requirements of a
categorical exemption, such as the historical resource exemption, “a party challenging the
exemption has the burden of producing evidence supporting an exception.” (Berkeley
Hillside Preservation v. City of Berkeley (2015) 60 Cal.4th 1086, 1105 (Berkeley
Hillside).) The Alliance asserts the showing it made before the City was sufficient to
support the historical resource exception, which states: “A categorical exemption shall
not be used for a project which may cause a substantial adverse change in the
                                                                                  2
significance of a historical resource.” (CEQA Guidelines, § 15300.2, subd. (f).) The
Alliance contends the fair argument standard governs the agency’s determination of
whether the historical resource exception applies and the evidence it presented to the City
provided a fair argument the project does not comply with the Secretary’s Standards.
The Alliance asserts the project therefore causes a substantial adverse change in the

2
  CEQA and its guidelines are inconsistent in their use of the indefinite article preceding
the term “historical resource.” (Compare § 21084, subd. (e) [“a historical resource”] with
§ 21084.1 [“an historical resource”] and CEQA Guidelines, § 15300.2, subd. (f) [“a
historical resource”] with CEQA Guidelines, § 15064.5, subd. (b) [“an historical
resource”].) Except when quoting from a statute or case law, we will use “a” rather than
“an” as the indefinite article preceding the term “historical resource.”

                                             3
significance of a historical resource and preparation of an EIR or a mitigated negative
declaration is required.
              We conclude substantial evidence supports the City’s finding the project
was exempt under the historical resource exemption because it was consistent with the
Secretary’s Standards. We further conclude the fair argument standard does not apply
where application of the historical resource exemption and the historical resource
exception depend on the same issue—whether the project complies with the Secretary’s
Standards. We affirm the judgment.

                   FACTUAL AND PROCEDURAL BACKGROUND
                                             I.
                THE HOUSE’S HISTORY PRIOR TO THE KIRBYS’ PURCHASE
              The house, built in 1925, is a two-story Colonial Revival style single-
family residence (1,940 square feet) with a partial basement (479 square feet). The
residence is described as having “a rectangular plan and a side-gable roof with boxed
eaves. The windows and doors are symmetrically placed on the west, north, and south
fa[ç]ades. There is a one-story projection with a flat roof and stepped wood parapet on
the east façade at [the] rear of the parcel. The entire house is clad with wood shingle
siding; the shingles on the north façade have been painted. The fenestration consists of
six-over-six double-hung wood sash windows, divided-light glazed doors, divided-light
wood sash basement windows (glazed and screened), and divided-light wood sash fixed
and casement windows. All windows have flat wood trim with projecting sills. There is
an exterior brick chimney prominently placed on the street-facing (west) façade, and a
wood porch with square wood posts supporting an upper deck that spans this fa[ç]ade.
The main entry, with a single wood paneled door, is on the south (primary) façade and is
reached by a raised wood porch with square wood posts supporting a flat roof. There is a

                                             4
secondary entry, with a partially glazed wood door, on the north façade reached by [a]
raised wood stoop.”
               The City does not have the original building permit for the house, but maps
from 1930 and 1948 show its footprint was the same then as it appears today, including
the porches and the one-story projection at the rear of the house. The basement is
believed to be a later addition.
               In 1981, the neighborhood in which the house is located was surveyed and
the house was identified as a potential heritage property. The property was considered
eligible for inclusion in the City’s historical register either as an individual resource or a
contributor to a historical district.
               In 2014, the City’s Heritage Committee approved an application to place
the house on the City’s historical register as an individual resource. The application
stated the house’s distinctive features were its gabled roof, shingled siding, and brick
chimney; it did not identify the one-story projection and its stepped wood parapet as
distinctive features. The house was listed on the City’s historical register “with a
‘K’ . . . rating,” which is used for buildings that “strongly maintain their original integrity
and demonstrate a particular architectural style or time period.”

                                              II.
                               THE KIRBYS’ PROPOSED PROJECT
               The Kirbys purchased the property in 2017. That year, they submitted their
initial application and plans to the City for the remodel of the existing two-story structure
and for a two-story addition with an attached garage at the rear of the property (the 2017
project). These additions required the removal of the one-story projection at the rear of
the house. A portion of the north exterior wall would also be removed, as well as two
replacement windows and a door on the north façade. The plans for the 2017 project also
required altering the location of two original windows on the north façade second floor,

                                               5
adding one window on the north façade, and removing two original attic openings and
two original windows from the east façade. “The new addition [would] wrap around the
existing house at the northeast corner of the first floor and extend beyond the width of the
original house on the north and south fa[ç]ades.” The cladding on the new addition was
designed to match the house’s existing shingle cladding, and the new windows would
match the existing ones. The addition’s roof would have a lower pitch and be lower in
height than the roof on the existing portion of the home. The 2017 project also provided
for new landscaping, hardscaping, and the addition of a pool on the property.
              City staff met with the Kirbys and their architect to review the project. As
part of the review process, an assessment of the 2017 project was conducted by the City’s
consultant Historic Resources Group (HRG). In 2018, HRG issued its report, which
analyzed the project’s potential impacts according to the Secretary’s Standards. HRG’s
report explained: “The [Secretary’s] Standards provide guidance for reviewing proposed
projects that may affect historic resources. The intent of the [Secretary’s] Standards is to
assist the long-term preservation of a property’s significance through the preservation,
rehabilitation, and maintenance of historic materials and features. The [Secretary’s]
Standards pertain to historic buildings of all materials, construction types, sizes, and
occupancy and encompass the exterior and interior of the buildings.”
              The HRG report concluded the 2017 project met Secretary’s Standards 1, 4,
6, 7, and 8 but did not meet standards 2, 3, 5, 9, and 10. HRG’s report also provided
guidance and recommendations to help the Kirbys and their architect design a more
compatible project. It explained: “There is no formula or prescription for designing a
new addition that meets the [Secretary’s] Standards. A new addition to a historic
building that meets the [Secretary’s] Standards can be any architectural style —
traditional, contemporary or a simplified version of the historic building. However, there
must be a balance between differentiation and compatibility in order to maintain the
historic character and the identity of the building being enlarged. New additions that too

                                              6
closely resemble the historic building or are in extreme contrast to it fall short of this
balance. Inherent in all of the guidance is the concept that an addition needs to be
subordinate to the historic building.”
              One project specific recommendation HRG made was to “[m]inimize the
degree of material loss by retaining the one-story extension.” Another recommendation
was: “The new addition should not wrap around the existing house, and it should be
visually distinguishable and not compete in size, scale, or design. Reduce the size and
scale of the addition so it is compatible with, and subordinate to, the original house per
[National Park Service Technical] Preservation Brief 14. The original design and form of
the house must remain clearly identifiable.” A third recommendation was: “Retain as
many original features as possible including original windows and doors in original
locations. The symmetrical window placement is important to the overall integrity and
architectural design of this house and should be retained.” Additional recommendations
were made concerning the exterior siding and the windows.
              The Kirbys and their architect revised their plans. In January 2019, they
                                                            3
presented their project to the City’s Heritage Committee, which recommended the City’s
Design Review Board approve the project with two alterations: (1) the new windows be
further differentiated from the original windows; and (2) the proposed wrap around on
the northeast elevation be reduced so the existing window could remain.
              For several months in 2019, the City’s staff, which included Jennifer Gates,
a qualified historical preservation professional, worked with the Kirbys and their architect
to conform the project to the Secretary’s Standards and to address the recommendations
of HRG and the City’s Heritage Committee. During this process, the addition to the
house was reduced from 1,304 square feet to 1,020 square feet. The revised project,

3
  The City’s Heritage Committee serves in an advisory role on matters pertaining to
historic preservation as specified in the Laguna Beach Municipal Code. (Laguna Beach
Mun. Code, § 25.45.004.)

                                               7
however, still called for the removal of the one-story projection at the rear and the
construction of a two-story addition in its place with an attached garage.
              As they were revising their plans, the Kirbys learned next-door neighbor
Dennis Sundman was concerned the proposed project would negatively impact his
property, i.e., his privacy, intrusion on the light and air to his property, and his view. In
an effort to address Sundman’s concerns, the Kirbys reduced the size of the second-story
addition and made further design changes.
              When the revised project was submitted to the City’s Design Review Board
in September 2020, the City’s staff prepared a report recommending approval of the
revised project and adoption of CEQA’s Class 31 historical resource exemption. The
report stated the Secretary’s Standards had been used to analyze the project and “the
project was found to be in compliance.” It further indicated no exception to the
categorical exemption applied. Addressing historical preservation, the staff report stated:
“The proposed addition does not diminish or detract from the historic significance of the
structure as it complies with the [Secretary’s Standards] for Rehabilitation, and the
addition is compatible in scale and character with the surrounding neighborhood.”
HRG’s report evaluating the 2017 project was included with the staff’s report.
              Several members of the City’s Design Review Board visited the property
and spoke to the Kirbys and Sundman prior to the board’s public hearing. At the hearing,
Sundman and Dr. Catherine Jurca, a consultant to Sundman, spoke in opposition to the
project. Members of the Design Review Board, the City’s staff, and Jurca discussed the
Secretary’s Standards and whether the project was in compliance. The Design Review
Board found the project met the Secretary’s Standards and qualified for a Class 31
historical resource exemption. The project was approved (four votes to one) with
conditions concerning the second-story windows on the north side of the addition and the
addition’s exterior paint color.

                                               8
              Sundman appealed the Design Review Board’s decision to the City
Council, asserting, among other claims, the board’s approval of the project violated
CEQA. Sundman asserted the Design Review Board improperly relied on the historical
resource exemption because the “project would cause a substantial adverse change in the
significance of a historic resource, which is considered a significant effect on the
environment.”
              Prior to the City Council’s public hearing on the matter, several neighbors
wrote to the council expressing their support for the project. However, the Laguna Beach
Historic Preservation Coalition submitted a letter, written by Jurca, in opposition. In the
letter, Jurca contended the City’s staff “erroneously claimed” the project conformed to
the Secretary’s Standards “to justify the categorical exemption.” Relying on the HRG
report and her own analysis, she asserted there was “substantial evidence to support a fair
argument that the project is not categorically exempt from CEQA and an Initial Study
must be prepared.”
              The City’s staff prepared a report for the City Council, recommending the
council deny the appeal and sustain the Design Review Board’s approval of the historical
resource exemption for the project. At the public hearing held in December 2020, the
City Council heard comments from individuals in favor of the project as well as those in
opposition. At the City Council’s request, the City’s staff addressed how the 2017
project had been revised to comply with the five previously unmet Secretary’s Standards
identified in the HRG report. After analyzing the project’s compliance with the
Secretary’s Standards, the City Council unanimously denied the appeal.

                                             III.
                PETITION FOR WRIT OF MANDAMUS IN THE TRIAL COURT
              In February 2021, the Historic Architecture Alliance and the Laguna Beach
Historic Preservation Coalition jointly filed a petition for writ of mandamus in the trial

                                              9
court under Public Resources Code section 21168 and Code of Civil Procedure section
1094.5. In the petition, the Historic Architecture Alliance described itself as “an
unincorporated association formed in the public interest following the city’s approvals of
the expansive project at” issue here and identified Sundman as a member. The Laguna
Beach Historic Preservation Coalition was described in the petition as “an unincorporated
association formed in the public interest prior to 2020,” whose members “enjoy and
appreciate the city’s historic resources” and “objected to the city’s approvals of
the . . . project.” Together, they argued the City abused its discretion and failed to act in
the manner required by law in approving the Kirbys’ project based on a categorical
exemption under CEQA. They asserted the City’s decision was not supported by
substantial evidence the project met the requirements for a historical resource exemption
and the exemption was barred by the historical resource exception because there was a
fair argument the project would result in a substantial adverse change in the significance
of a historical resource.
              In 2022, the trial court denied the petition. It concluded the administrative
record contained substantial evidence supporting the City’s decision the project qualified
for a historical resource exemption (CEQA Guidelines, § 15331) and the Alliance had not
carried their burden of showing an exception applied. After judgment was entered in
favor of the City and the Kirbys, the Alliance appealed.

                                       DISCUSSION
                                              I.
                               THE CEQA REVIEW PROCESS
              “‘CEQA is a comprehensive scheme designed to provide long-term
protection to the environment.’ [Citation.] It applies to ‘discretionary projects proposed
to be carried out or approved by public agencies.’ [Citation.] ‘In enacting CEQA, the
Legislature declared its intention that all public agencies responsible for regulating

                                              10
activities affecting the environment give prime consideration to preventing environmental
damage when carrying out their duties. [Citations.] CEQA is to be interpreted “to afford
the fullest possible protection to the environment within the reasonable scope of the
statutory language.”’” (Protect Tustin Ranch v. City of Tustin (2021) 70 Cal.App.5th
951, 958 (Protect Tustin Ranch).)
              CEQA and the CEQA Guidelines provide three fundamental steps or tiers
in the review process. (Protect Tustin Ranch, supra, 70 Cal.App.5th at p. 959.) “‘“The
first step is jurisdictional and requires a public agency to determine whether a proposed
activity is a ‘project.’”’” (Ibid.) Here, there is no dispute the Kirbys’ remodel and
expansion of their house listed on the City’s historical registry qualifies as a project under
       4
CEQA. The issues in this appeal concern the second step of the review process.
              At the second step, “the agency must next 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 [citations].” (California
Building Industry Assn. v. Bay Area Air Quality Management Dist. (2015) 62 Cal.4th
369, 382; accord, Protect Tustin Ranch, supra, 70 Cal.App.5th at p. 959.) There are
33 categorical exemptions listed in the CEQA Guidelines. (CEQA Guidelines,
§§ 15301–15333.) These are “classes of projects” the Secretary of the Natural Resources
Agency has determined “do not have a significant effect on the environment” (Pub.
Resources Code, § 21084, subd. (a)) and are therefore “categorically exempt” from
CEQA’s provisions (CEQA Guidelines, § 15300). “In listing a class of projects as
exempt, the Secretary has determined that the environmental changes typically associated

4
  CEQA defines a “‘project’” as “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: [¶] . . . [¶] (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.” (§ 21065.) The Kirbys’ remodel and expansion of their
house requires the issuance of permits by the City.

                                              11
with projects in that class are not significant effects within the meaning of CEQA, even
though an argument might be made that they are potentially significant.” (Berkeley
Hillside, supra, 60 Cal.4th at pp. 1104–1105.) At issue in this case is the historical
resource categorical exemption. (CEQA Guidelines, § 15331.)
              “Unlike statutory exceptions, categorical exemptions such as the [historical
resource] exemption are subject to exceptions enumerated in [CEQA] Guidelines section
15300.2. [Citation.] An agency may not apply a categorical exemption without
considering whether it is foreclosed by an exception.” (World Business Academy v. State
Lands Com. (2018) 24 Cal.App.5th 476, 491 (World Business Academy).) “If the agency
establishes the project is within an exempt class, the burden shifts to the party
challenging the exemption to show that it falls into one of the exceptions.” (Committee
to Save the Hollywoodland Specific Plan v. City of Los Angeles (2008) 161 Cal.App.4th
1168, 1186; accord, Berkeley Hillside, supra, 60 Cal.4th at p. 1105.) In this matter, the
Alliance asserts it carried its burden of establishing the historical resource exception
applied and therefore the project was not exempt from CEQA’s requirements.
              “‘“If a project is categorically exempt and does not fall within an exception,
‘“it is not subject to CEQA requirements and ‘may be implemented without any CEQA
compliance whatsoever.”’”’” (Protect Tustin Ranch, supra, 70 Cal.App.5th at p. 959.)
“The agency need only prepare and file a notice of exemption [citations], citing the
relevant statute or section of the CEQA Guidelines and including a brief statement of
reasons to support the finding of exemption [citation].” (Muzzy Ranch Co. v. Solano
County Airport Land Use Com. (2007) 41 Cal.4th 372, 380.)
              The City in this matter filed a notice of exemption after concluding the
Kirbys’ project was categorically exempt from CEQA requirements under the historical
resource exemption. The City, therefore, did not reach step three of the CEQA review
process, which would have required the City to “decide whether the project may have a
significant effect on the environment” and prepare “a negative declaration, a mitigated

                                             12
negative declaration or an environmental impact report.” (Protect Tustin Ranch, supra,
70 Cal.App.5th at p. 959.)
              “‘[In] an appeal challenging a trial court’s denial of a petition for a writ of
mandate in a CEQA case, our task is the same as the trial court’s. [Citation.] We
conduct our review of the agency’s action independently of the trial court’s findings.
[Citation.] Accordingly, in this appeal we review [the] City’s decision and not the trial
court’s.’” (Protect Tustin Ranch, supra, 70 Cal.App.5th at p. 959.)

                                             II.
                             HISTORICAL RESOURCE EXEMPTION
              Because the Kirbys’ house is included in the City’s register of historical
resources, it is considered a presumptive historical resource under CEQA. (§ 21084.1;
                                              5
CEQA Guidelines, § 15064.5, subd. (a)(2).) As a presumptive historical resource, a
project involving it is subject to CEQA’s requirements unless the City, as the lead
agency, concludes the project is exempt and if categorically exempt, an exception does
not bar its application. (CEQA Guidelines, § 15061, subds. (a), (b).)
              The City determined the Kirbys’ project was categorically exempt from
CEQA under the Class 31 exemption for a historical resource. This exemption states:
“Class 31 consists of projects limited to maintenance, repair, stabilization, rehabilitation,
restoration, preservation, conservation or reconstruction of historical resources in a
manner consistent with the Secretary of the Interior’s Standards for the Treatment of
Historic Properties with Guidelines for Preserving, Rehabilitating, Restoring, and
Reconstructing Historic Buildings (1995), Weeks and Grimmer.” (CEQA Guidelines,

5
  A structure’s status as a historical resource for purposes of CEQA is either mandatory,
presumptive, or discretionary, depending on whether it has been or could be listed on
various registers of historical resources. (Valley Advocates, supra, 160 Cal.App.4th at
pp. 1051–1052, 1054, 1058–1059.)

                                             13
§ 15331.) This means a project involving the rehabilitation of a historical resource is
categorically exempt from CEQA if the project is consistent with the Secretary’s
Standards and application of the exemption is not barred by an exception. (CEQA
Guidelines, §§ 15061, subd. (b)(2), 15331.) By creating this exemption, the Secretary of
California’s Natural Resources Agency has declared projects involving the remodel of
historical resources in a manner consistent with the standards promulgated by the
Secretary of the United States Department of the Interior do not have a significant effect
on the environment and are exempt from CEQA. (Pub. Resources Code, § 21084,
subd. (a); CEQA Guidelines, § 15331.)

                                             III.
                            HISTORICAL RESOURCE EXCEPTION
              The historical resource exception bars application of a categorical
exemption if the project “may cause a substantial adverse change in the significance of a
historical resource, as specified in Section 21084.1 . . . .” (§ 21084, subd. (e); accord,
CEQA Guidelines, § 15300.2, subd. (f).) Public Resources Code section 21084.1 states:
“A project that may cause a substantial adverse change in the significance of an historical
resource is a project that may have a significant effect on the environment.”
              This is reiterated and further explained in CEQA Guidelines section
15064.5, subdivision (b), which defines a “[s]ubstantial adverse change in the
significance of an historical resource” as the “physical demolition, destruction,
relocation, or alteration of the resource or its immediate surroundings such that the
significance of an historical resource would be materially impaired.” (Id., subd. (b)(1).)
CEQA Guidelines section 15064.5, subdivision (b)(2) describes what constitutes a
material impairment of a historical resource. It explains, in relevant part: “The
significance of an historical resource is materially impaired when a project: [¶] . . . [¶]
(B) Demolishes or materially alters in an adverse manner those physical characteristics

                                             14
that account for its inclusion in a local register of historical resources . . . or its
identification in an historical resources survey . . . .” As succinctly stated in one treatise:
“The significance of a resource is materially impaired when the physical characteristics
that convey its historical significance and that justify its designation as a historical
resource are demolished or materially altered in an adverse manner.” (2 Kostka &
Zischke, Practice Under the Cal. Environmental Quality Act (Cont.Ed.Bar 2023)
§ 20.99(D), p. 20-137.)
               CEQA Guidelines section 15064.5, subdivision (b)(3) offers agencies
further guidance on determining whether a project has a significant impact on a historical
resource. It states: “Generally, a project that follows the Secretary of the Interior’s
Standards for the Treatment of Historic Properties with Guidelines for Preserving,
Rehabilitating, Restoring, and Reconstructing Historic Buildings or the Secretary of the
Interior’s Standards for Rehabilitation and Guidelines for Rehabilitating Historic
Buildings (1995), Weeks and Grimmer, shall be considered as mitigated to a level of less
than a significant impact on the historical resource.” (Italics added; accord, CEQA
Guidelines, § 15126.4, subd. (b)(1).) This means if the Secretary’s Standards are
followed, then generally the project does not have a significant impact on the historical
resource and the exception does not apply.
               CEQA Guidelines section 15064.5, subdivision (b)(4) requires a lead
agency to “identify potentially feasible measures to mitigate significant adverse changes
in the significance of an historical resource” and “ensure that any adopted measures to
mitigate or avoid significant adverse changes are fully enforceable through permit
conditions, agreements, or other measures.”

                                                15
                                              IV.
     THE SECRETARY’S STANDARDS IN THE HISTORICAL RESOURCE EXEMPTION AND
                          THE HISTORICAL RESOURCE EXCEPTION

              For both the historical resource exemption and the historical resource
exception, conformity with the Secretary’s Standards is consequential. If a project
involving a historical resource is consistent with the Secretary’s Standards, the project is
exempt from CEQA under the historical resource exemption (CEQA Guidelines,
§ 15331) and “shall be considered as mitigated” to have “less than a significant impact on
the historical resource” (id., § 15064.5, subd. (b)(3)), so that the historical resource
exception does not bar the exemption.
              “The Secretary’s Standards are the benchmark that CEQA uses to establish
whether a project will have a significant adverse impact on a historical property.”
(Treasure Island, supra, 227 Cal.App.4th at p. 1066.) If the Secretary’s Standards are
followed, then under the CEQA Guidelines, any impact to the historical resource “that
might otherwise be regarded as adverse will be considered to have been mitigated to
insignificant levels.” (Treasure Island, supra, at p. 1066.)
              An agency’s finding a project comes within the historical resource
exemption necessarily includes the finding the project complies with the Secretary’s
Standards. It also includes an implied finding the project does not have a significant
impact on the environment. (CEQA Guidelines, § 15064.5, subd. (b)(3); World Business
Academy, supra, 24 Cal.App.5th at p. 496 [“‘[A]n agency’s finding that a particular
proposed project comes within one of the exempt classes necessarily includes an implied
finding that the project has no significant effect on the environment’”].)

                                              16
                                              V.
   THE HISTORICAL RESOURCE EXEMPTION IS SUPPORTED BY SUBSTANTIAL EVIDENCE
              “‘A public agency’s “determination that [a particular] project [is] exempt
from compliance with CEQA requirements . . . is subject to judicial review under the
abuse of discretion standard in . . . section 21168.5. [Citations.] . . . Abuse of discretion
is established if the agency has not proceeded in a manner required by law or if the
determination or decision is not supported by substantial evidence.”’” (Protect Tustin
Ranch, supra, 70 Cal.App.5th at p. 960.) “Judicial review of these two types of error
differs significantly: While we determine de novo whether the agency has employed the
correct procedures, scrupulously enforcing all legislatively mandated CEQA
requirements, we accord greater deference to the agency’s substantive factual
conclusions.” (Treasure Island, supra, 227 Cal.App.4th at p. 1045.)
              “‘[W]here[, as here,] a public agency makes a factual determination that a
project falls within a . . . categorical exemption, we apply the substantial evidence
standard in reviewing the agency’s finding.’” (Protect Tustin Ranch, supra, 70
Cal.App.5th at p. 960.) “Under this deferential standard of review, our role is different
from the agency’s. [Citation.] The agency must weigh the evidence before it and make a
finding based upon the weight of the competing evidence. As a reviewing court, we do
not reweigh the evidence. Instead, we ‘must affirm [the agency’s] finding if there is any
substantial evidence, contradicted or uncontradicted, to support it.’ [Citation.] We
‘resolv[e] all evidentiary conflicts in the agency’s favor and indulg[e] . . . all legitimate
and reasonable inferences to uphold the agency’s finding . . . .’” (World Business
Academy, supra, 24 Cal.App.5th at pp. 498–499.) If the administrative record “contains
evidence of ponderable legal significance that is reasonable in nature, credible, and of
solid value, to support the agency’s decision,” we must affirm. (Protect Tustin Ranch,
supra, 70 Cal.App.5th at p. 960.)

                                              17
              Here, there is substantial evidence in the administrative record supporting
the City’s factual determination the Kirbys’ project is consistent with the Secretary’s
Standards and falls within the historical resource exemption. The administrative record
shows the project was subjected to a rigorous development cycle and numerous revisions
were made to the proposed plans. When the initial plans were reviewed by HRG, it
concluded the project met standards 1, 4, 6, 7, and 8 of the Secretary’s Standards but did
not meet standards 2, 3, 5, 9, and 10. HRG made recommendations to assist the Kirbys in
designing an addition that would meet the Secretary’s Standards. The Kirbys revised
their plans, and their plans were submitted to the City’s Heritage Committee for review.
The Heritage Committee recommended approval of the project with two modifications,
which included additional differentiation of the new windows and reduction of the
proposed wraparound on the northeast elevation for an existing window to remain. The
City’s staff worked with the Kirbys and their architect to conform the project to the
Secretary’s Standards and to address the recommendations from HRG and the Heritage
Committee. After Sundman expressed concerns about the impact the project would have
on his neighboring property, the Kirbys made further design changes to decrease the size
of their addition.
              The City’s staff concluded the revised project qualified for a historical
resource exemption under CEQA because it conformed to the Secretary’s Standards and
an exception to the exemption did not apply. At the hearing before the City’s Design
Review Board, Sundman and Jurca spoke in opposition of the project. Jurca asserted the
project did not meet the Secretary’s Standards and the City’s staff had not provided an
evaluation demonstrating it did. Members of the Design Review Board questioned the
City’s staff concerning compliance with the Secretary’s Standards. The City’s staff
reviewed the Secretary’s Standards discussed in the HRG report and explained the
changes made to the project after the HRG report to comply with the Secretary’s
Standards. After staff addressed how the project had been revised to meet the previously

                                             18
unsatisfied Secretary’s Standards, the Design Review Board found the project met the
Secretary’s Standards and qualified for a historical resource categorical exemption. The
Design Review Board approved the project with conditions concerning some of the
windows on the addition’s second story and changing the addition’s exterior color.
              After Sundman appealed the Design Review Board’s approval of the
project, the City Council considered the matter at a public hearing. The City’s staff again
explained how the revised plans for the project complied with the Secretary’s Standards
that were unmet at the time of the HRG report. Opposing viewpoints were presented by
Jurca and Francesca Smith, an architectural historian. Jurca asserted the finding the
project met the Secretary’s Standards was not supported by substantial evidence. Smith
similarly asserted the project did not comply with the Secretary’s Standards. After
considering these comments, the staff’s analysis, and the Design Review Board’s
findings, the City Council found the project complied with the Secretary’s Standards.
The City Council unanimously denied the appeal and sustained the Design Review
Board’s decision to approve the project and adopt a historical resource exemption under
CEQA.
              Under the substantial evidence standard, it is the agency’s role to weigh
conflicting evidence and not ours. (Protect Tustin Ranch, supra, 70 Cal.App.5th at
p. 960.) Thus, we accept the City’s finding the evidence of compliance with the
Secretary’s Standards was weightier than the opposing views.

                                            VI.
            THE ALLIANCE’S RELIANCE ON THE FAIR ARGUMENT STANDARD
                       FOR THE HISTORICAL RESOURCE EXCEPTION

              The Alliance asserts the City should have applied the fair argument
standard to determine whether the historical resource exception barred reliance on the
historical resource exemption and further asserts it satisfied this standard. The Alliance

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contends the historical resource exception includes two different determinations. The
first is whether the project involves a CEQA-defined historical resource. As there is no
dispute the Kirbys’ project involved such, the Alliance focuses on the second
determination. The Alliance argues the second determination “is whether the Project
may have an adverse impact on this historic resource,” and the Alliance asserts the fair
argument standard applies to this issue. We conclude in the particular context of this
case, where the decisive factor for the historical resource exception is the same as that for
the historical resource exemption—whether the project complies with the Secretary’s
Standards—the Alliance’s reliance on the fair argument standard is misplaced.
              Under the fair argument standard, “‘“an agency is merely supposed to look
to see if the record shows substantial evidence of a fair argument that there may be a
significant effect. [Citations.] In other words, the agency is not to weigh the evidence to
come to its own conclusion about whether there will be a significant effect.”’ [Citation.]
An agency must find a ‘fair argument’ if there is any substantial evidence to support that
conclusion, even if there is competing substantial evidence in the record that the project
will not have a significant environmental effect.” (World Business Academy, supra,
24 Cal.App.5th at p. 499.) “The fair argument standard creates a low threshold favoring
future environmental review and differs markedly from the deferential substantial
evidence standard of review normally enjoyed by agencies.” (Treasure Island, supra,
227 Cal.App.4th at p. 1049.)
              The Alliance asserts it cleared this low threshold for the historical resource
exception with the evidence before the City from its experts Jurca and Smith and the
HRG report, all of whom concluded the project at various stages did not comply with the
Secretary’s Standards.
              The Alliance’s argument the fair argument standard applies comes from
two cases addressing issues different than the one before us, which state, in dicta, the fair
argument standard applies to a facet of the historical resource exception. In the first case,

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Valley Advocates, the Court of Appeal held the fair argument standard does not apply to
the question of whether a building is a historical resource under CEQA. (Valley
Advocates, supra, 160 Cal.App.4th at pp. 1046, 1072.) Although unnecessary for the
issues before it, the appellate court remarked, “once the resource has been determined to
be an historical resource, then the fair argument standard applies to the question whether
the proposed project ‘may cause a substantial adverse change in the significance of an
historical resource’ [citation] and thereby have a significant effect on the environment.”
(Id. at p. 1072.)
               In the second case, Berkeley Hillside, the California Supreme Court quoted
this portion of Valley Advocates when addressing the standard of review to be applied to
an agency’s determination concerning the unusual circumstances exception. (Berkeley
Hillside, supra, 60 Cal.4th at pp. 1110, 1117.) The Supreme Court concluded two
different standards apply under the unusual circumstances exception where the issues are:
(1) whether a project presents circumstances that are unusual for projects in an exempt
class, and (2) whether there is “a reasonable possibility of a significant effect due to that
unusual circumstance.” (Id. at p. 1105.) As to the first issue, “a reviewing court should
apply the traditional substantial evidence standard.” (Id. at p. 1114.) As to the second
issue, the agency applies the fair argument standard and the reviewing court
“‘determine[s] whether substantial evidence support[s] the agency’s conclusion as to
whether the prescribed “fair argument” could be made.’” (Id. at p. 1115.) It was in this
context the Supreme Court used “Valley Advocates to support its conclusion that a
bifurcated standard could apply where one part of the agency’s decision was subjected to
the substantial evidence standard and another part to the fair argument standard.”
(Friends of Willow Glen Trestle v. City of San Jose (2016) 2 Cal.App.5th 457, 465–466.)
               But neither Berkeley Hillside nor Valley Advocates was addressing the issue
before us—does the fair argument standard apply to the agency’s determination of
whether a project complies with the Secretary’s Standards for purposes of the historical

                                              21
resource exception when the agency has found the project does comply with the
Secretary’s Standards for purposes of the historical resource exemption. We conclude
the fair argument standard does not apply in this situation.
              When the historical resource exemption is at issue, we apply the substantial
evidence standard to the agency’s determination of whether the project complies with the
Secretary’s Standards. Whether a particular project follows the Secretary’s Standards,
like the issue of “[w]hether a particular project presents circumstances that are unusual
for projects in an exempt class[,] is an essentially factual inquiry.” (Berkeley Hillside,
supra, 60 Cal.4th at p. 1114.) “Accordingly, as to this question, the agency serves as ‘the
finder of fact’ [citation], and a reviewing court should apply the traditional substantial
evidence standard . . . .” (Ibid.)
              When a party challenging the historical resource exemption asserts the
historical resource exception applies because the project does not comply with the
Secretary’s Standards, there is no second inquiry to which the agency applies the fair
argument standard. We do not disagree that two different standards of review may apply
when there are two different determinations to be made, as addressed in Valley Advocates
and Berkeley Hillside. But here, the single inquiry to be determined is whether the
project complies with the Secretary’s Standards. During this inquiry, the agency
considers the evidence and argument of the opposing sides. If the agency finds the
project follows the Secretary’s Standards, the agency’s finding establishes the project
does not have a significant impact on the historical resource and the historical resource
exception would not bar reliance on the historical resource exemption. (CEQA
Guidelines, § 15064.5, subd. (b)(3).)
              To establish the historical resource exception, it is not enough to merely
make a fair argument the project did not comply with the Secretary’s Standards. If this
was all the challenger had to establish, the historical resource categorical exemption
would be meaningless. (See Berkeley Hillside, supra, 60 Cal.4th at pp. 1104–1105

                                             22
[discussing the unusual circumstances exception].) It would prohibit the agency from
weighing the conflicting evidence and making a finding based upon the weight of the
competing evidence.
              Here, the City considered the Alliance’s evidence in evaluating whether the
project complied with the Secretary’s Standards, but the City nonetheless concluded the
project was entitled to a historical resource exemption. As we have discussed, the City’s
conclusion is supported by substantial evidence. Thus, the record does not indicate the
City abused its discretion in determining there was no exception to the historical resource
exemption.

                                     DISPOSITION
              The judgment is affirmed. Respondents are entitled to recover their costs
on appeal.

                                                 MOTOIKE, J.

WE CONCUR:

O’LEARY, P. J.

DELANEY, J.

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