Case Summary: New CEQA Case Reinforces Validity of Using Projected Conditions in EIR Traffic Baseline

December 30, 2011

On November 22, 2011, the Sixth District of the California Court of Appeal certified for publication its decision Pfeiffer v. City of Sunnyvale City Council ("Pfeiffer"), Case No. H036310, in which the Court upheld the use of a traffic baseline that included future projects, notwithstanding an earlier Sixth District case, Sunnyvale West Neighborhood Ass’n v. City of Sunnyvale City Council (2010) 190 Cal.App.4th 1351 (“Sunnyvale West”), that had raised serious concerns about that practice.

It has been a longstanding practice of traffic engineers evaluating the potential traffic impacts of a project to analyze whether roadways could accommodate project-generated traffic under the circumstances that were expected to exist when the project was fully constructed and actually generating traffic.  Typically, this formulation would assess a baseline traffic level consisting of existing traffic plus traffic from approved but not yet built projects and anticipated growth, and then compare that background level to the traffic circumstances that would be expected once project-generated traffic was added to the equation. 

This practice was severely questioned in the Sixth District’s 2010 decision in Sunnyvale West.  In Sunnyvale West, the court acknowledged that a lead agency has discretion to determine what constitutes the “existing physical conditions” that CEQA requires be used as a baseline for measuring impacts.  However, it concluded that “[t]he Supreme Court never sanctioned the use of predicted conditions on a date subsequent to EIR certification or project approval as the baseline. . . .”  The court then invalidated the EIR because it “did not use the anticipated traffic conditions on the expected date of project approval . . . .”   The court further emphasized that it did not interpret the CEQA Guidelines “to mean that a lead agency has carte blanche to select the conditions on some future, post-approval date as the ‘baseline’ so long as it acts reasonably as shown by substantial evidence.”

In response to the Sunnyvale West decision, traffic engineers began excluding approved but not yet built projects, as well as anticipated growth, from their baseline analyses, and instead developed a new practice of assessing project impacts by comparing project traffic against circumstances existing no later than the project approval date, even when a project was not expected to generate traffic impacts until far into the future.  However, that formulation was largely considered unhelpful by public agencies because they still had to determine whether road capacity would be sufficient for a project (including background growth in the future), when the completed project actually started generating traffic.  Consequently, some EIR preparers added another layer to their traffic analyses such that EIRs often now contain three separate traffic scenarios:  (a) the Sunnyvale West analysis in which no future growth, including from approved projects,  are included in the baseline; (b) a near-term cumulative analysis in which approved, but not completed projects are included in the background traffic; and (c) a long-term cumulative analysis that analyzes traffic impacts at general plan buildout or some other future date.  The inevitable result of all of these “layers” of analysis is added complexity, and confusion about both when mitigation requirements are triggered and the extent to which project proponents are required to actually fund mitigation.

In Pfeiffer, which involved a neighborhood group’s challenge to the expansion of a medical facility and the creation of a waste management and parking facility on various single-family residential lots, the city’s traffic analysis identified existing conditions measured by traffic counts, and then used background conditions, consisting of the existing peak-hour volumes multiplied by a growth factor derived from the City’s travel demand forecasting model, plus traffic from approved but not yet built projects, to determine that the project would not result in significant near-term impacts or any significant intersection impacts.  The neighborhood group alleged that that the traffic analysis used an illegal “hypothetical” baseline rather than assessing impacts based on existing conditions. 

On appeal, the Pfeiffer Court upheld the City’s traffic analysis, citing a long list of California Supreme Court decisions characterizing CEQA’s "baseline" concept as flexible, especially "where conditions are expected to change quickly during the period of environmental review," for reasons other than implementation of the project under review.  The Court noted that CEQA does not require that baselines only use currently existing conditions; rather, “predicted conditions may serve as an adequate baseline where environmental conditions vary.”  On this point, the Court found that there was substantial evidence that traffic conditions could vary from existing conditions due to traffic growth and construction of already-approved developments.  In addition, the Court stated that the EIR did address existing conditions based on actual traffic counts in its analysis.

The Court then went on to distinguish Sunnyvale West, noting that the EIR at issue in Sunnyvale West had used a baseline consisting of projected conditions in 2020 – more than a decade after project approval.   The Court stated:  “Sunnyvale West is therefore distinguishable from the present case, where the traffic baselines included in the EIR were not limited to projected traffic condition[s] in the year 2020, but also included existing conditions and the traffic growth anticipated from approved but not yet constructed developments.”  The Court emphasized that the CEQA Guidelines expressly provide for consideration of potential future conditions, quoting CEQA Guidelines 15126.2 and 15125, which require that environmental documents consider “long-term effects” and “potential future conditions . . . .”

The holding in Pfeiffer is notably different from, but consistent with, Madera Oversight Coalition v. County of Madera (2011) 199 Cal.App.4th 48, in which the Fifth District found an EIR’s baseline selection inadequate for a mixed-use development project near the San Joaquin River in southeastern Madera County.  In Madera Oversight Coalition, the EIR only labeled one of its three traffic scenarios as a “baseline” in connection with predicted year 2025 conditions.  However, on appeal, the court could not determine if existing conditions were also used as a baseline because, although three traffic scenarios were provided (existing 2007, predicted 2025 without the project, and predicted 2025 with the project), because there was no explicit statement or analysis confirming that existing conditions had been used.  As in Sunnyvale West, the Madera Oversight Coalition case only used “projected traffic conditions in the year 2020” as a baseline, and did not consider traffic impacts on the existing environment.

The Court of Appeal decision in Pfeiffer is significant for several reasons.  It restores some of the traditional deference that courts have given to a lead agency's determination concerning how to establish baseline conditions so as to ensure preparation of a practical, useful analysis, and clarifies that projected conditions, if used properly, can serve as a baseline.  In addition, Pfeiffer reinforces the importance of (1) discussing existing conditions in addition to other scenarios that may provide more useful information regarding potential project impacts; and (2) making sure that any decision to deviate from using existing conditions as the analytical baseline is supported by substantial evidence.

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