WALNUT CREEK, CA-GlobeSt.com chats with Christopher Calfee ofcounsel in the environmental and natural resources practice groupof Best Best & Krieger LLP’s Walnut Creek and Sacramentooffices about planning for development certainty in a quicklychanging climate and about making the most out of recent changes inthe State CEQA Guidelines.

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Dolce: Tell me a bit about the Global WarmingSolutions Act of 2006 and the Sustainable Communities and ClimateProtection Act of 2009, because I know the development landscapechanged as a result of those, and I know there is a new set ofclimate regulations were enacted this year aswell.

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Calfee: The Global Warming SolutionsAct of 2006, commonly known as AB32, does not directly regulatereal estate development. Shortly after its passage, however, thedevelopment landscape quickly changed as new projects werechallenged in court for not incorporating climate changeconsiderations into the environmental review process. Projectproponents soon rushed to highlight the green credentials of theirprojects, but a lack of statewide standards and inconsistent localresponses to climate change policies injected unwelcome uncertaintyinto the development process. The Sustainable Communities andClimate Protection Act of 2008 (SB375) offers some relief byexempting certain types of mixed use projects that would beconsistent with a regional “Sustainable Communities Strategy” fromsome of the more onerous environmental review requirements. It willstill be several years though before such strategies are adopted insome of our most populous regions. Even then, the promisedexemptions may apply to only a narrow category of projects.

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Beyond the AB32 and SB375 hype, a separate set of climate changeregulations were enacted just this year that could provide just thecertainty necessary to facilitate future development. Majoramendments to guidelines implementing the California EnvironmentalQuality Act, widely known as CEQA, went into effect in Marchrequiring public agencies to analyze and mitigate the effects oftheir projects’ greenhouse gas emissions. In a nutshell, before anypublic agency can adopt almost any type of project, theenvironmental review for that project must study the magnitude ofthe project’s direct and indirect greenhouse gas emissions, decidewhether and how those emissions may harm the environment, andimplement measures to mitigate those emissions. While analyzing aproject’s greenhouse gas emissions is a complicated task, thoseregulations also provide a streamlining tool for communities thathave adopted a climate action plan or similar policy for reducingcommunity-wide greenhouse gas emissions. Under the new CEQAGuidelines, projects that are consistent with a communitygreenhouse gas reduction plan can skip the complicatedanalysis. In other words, the agency will not have toreinvent the wheel for each new project that is proposed.

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Dolce: What goes into a climate actionplan?

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Calfee: One of the major plan elementsis a reduction target. Unlike the SB375 targets, which are mandatedby the State Air Resources Board, emissions reduction targets in alocal climate plan are set by the local community, based on localconditions. Once potential future emissions are calculated, thenext piece of the plan is to identify ways to reach the reductiontarget. This is the part that will interest developers. Awell-designed plan will spell out exactly how emissions reductionswill be achieved (i.e., through energy efficiency standards, solarrequirements, urban forestry projects, programs for efficiencyupgrades, etc.). This benefits potential developers in at least twoways. First, the types of exactions and mitigation measuresthat may be required will be known up front. Second, suchplans can also achieve emissions reductions from existing sources,so that the entire burden does not have to be shouldered by newdevelopment.

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Dolce: How many communities actually have suchplans?

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Calfee: More than you might think. TheGovernor’s Office of Planning and Research further reports that, asof 2008, more than 70 cities and counties had developed generalplan policies and programs addressing climate change. More arelikely to come, since each of the major air districts that hastried to develop greenhouse gas thresholds has recognized thatprojects that are consistent with qualified plans should not haveto engage in further analysis. Such plans can be included in alocal general plan or can be adopted as a stand-alone policydocument. While the updated CEQA Guidelines set out criteria forwhat such plans should contain, communities have tremendousflexibility in developing a plan that suits local conditions andpriorities.

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Dolce: So does this mean that some developers mightsit on the sidelines while things get worked out?

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Calfee: Yes, some local agencies anddevelopers might still be tempted to sit on the sidelines whilequestions about AB32 and SB375 get worked out. There are very goodreasons to partner with local agencies in the development of suchclimate plans now, however. First, even if Proposition 23, theproposal to suspend AB32, were passed by the voters in November, itwould not insulate projects from CEQA compliance. It would onlysuspend the provisions of the Health and Safety Code added by AB32and climate change would remain a CEQA issue. Second, a sustainablecommunity’s strategy developed under SB375 is only required toaddress greenhouse gas emissions from transportation. Unless aproject is completely exempt from CEQA review, even a project thatis consistent with a sustainable community’s strategy may stillneed to analyze non-transportation greenhouse gas emissions. Alocal greenhouse gas reduction plan, on the other hand, couldaddress a broader range of sources of greenhouse gas emissions inthe community. Finally, because development of sustainablecommunity’s strategies is tied to the regional transportationplanning cycle, it will still be several years before most regionshave an adopted strategy in place.

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Local plans for greenhouse gas reduction can be designed tomaximize local public benefits and ease the analysis of newprojects under new CEQA rules. More importantly, local governmentsthat develop such plans can achieve greenhouse gas emissionsreductions in a way that reflects local concerns, constraints andpriorities. Working with local agencies in the development ofsuch plans will help provide some certainty in an uncertaindevelopment climate.

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Natalie Dolce

Natalie Dolce, editor-in-chief of GlobeSt.com and GlobeSt. Real Estate Forum, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.