SAN FRANCISCO—The California Coastal Commission recently issued draft residential adaptation policy guidance to help municipal governments evaluate residential development compliance with the California Coastal Act, GlobeSt.com learns in the second in a two-part exclusive. There are legal considerations surrounding this draft policy, as one might imagine.

Municipalities implementing these policy recommendations may face legal issues related to provisions of the Coastal Act itself, the public trust doctrine and property takings, whether through eminent domain or through regulatory takings under federal law. Because the act aims to protect shorelines from any unnecessary risks arising from new development (i.e., development completed after the act's passage), the draft guidance raises potential concerns regarding public access, marine habitats, water quality, waterway conditions and visual resources.

For instance, some measures, such as armoring against sea level rise, that alter natural shoreline processes are strictly limited for new development but sometimes permitted to save existing development only if necessary and if no less environmentally damaging measure is available. Other restrictions may limit the type of measures available for new development. The draft guidance advises municipalities to work closely with the commission to navigate these intricacies and craft policies consistent with the act. Another issue is the common-law doctrine of public trust, under which the state of California holds sovereign title to all tidelands, submerged lands and navigable-waterway beds in trust for the benefit of its citizenry.

“To illustrate, the doctrine generally forbids water use that individually benefits a particular residential or commercial owner while allowing uses related to recreation, maritime commerce, navigation and fishing,” George Gigounas, a partner in DLA Piper's litigation and environment, health and safety practices, tells GlobeSt.com. “The demarcation of California's sovereign title is the mean high-tide line. That line will likely envelope more real estate as sea levels rise, leading to more disputes over the reach of California's sovereign ownership, especially as the mean high-tide line encroaches on areas primed for development in previously safe areas.”

Gigounas says disputes may also arise under the doctrine where municipalities sell public lands to private buyers, especially where land is purchased before rising sea levels bring it within the public trust.

Finally, municipal efforts to regulate coastal development may result in a taking under the US Constitution in one of three situations, GlobeSt.com learns. The first is when regulation deprives an owner of all economically beneficial use of the property. A taking may also occur if regulation significantly reduces the property's value even if some economically beneficial use remains. Finally, a compensable regulatory taking can also occur if a government-permitting decision places exactions as conditions on a property owner to abate a harmful condition associated with the property unless the condition is sufficiently related to the harmful condition. Property owners are entitled to just compensation if regulation amounts to a taking, but would receive nothing where regulation does not reach that level.

Developers of property in California's coastal zone face considerable uncertainty from accelerating sea-level rise and government efforts to address that it. Developers with existing coastal property may find value considerably diminished by regulatory responses to sea-rise vulnerability, making careful analysis of regulatory takings essential. Particular risks will arise where municipal policies seek to safeguard interests—such as public access or ecological balance. Even development completed before adoption of the act may be susceptible to losses from regulation, depending on the strategies local governments adopt. Property owners must therefore closely observe local regulatory trends in these areas and assess impacts on a case-by-case basis. Even formerly unoffending coastal developments could be labeled nuisances if found to interfere with public rights to the coastline or with nearby private owners' reasonable use of their own property.

“The final guidance will provide important clues about the trajectory of municipal efforts to address rising sea levels,” Jesse Medlong, litigation associate in DLA Piper's San Francisco office, tells GlobeSt.com. “Developers and property owners should consider the final document in its entirety, carefully considering how their local governments seek to adopt the guidance. They should also coordinate with state and local authorities, and experienced California counsel, so ongoing and future coastal development complies with the changing regulatory landscape and to ensure maximum protection where development projects potentially intersect with vulnerable coastal areas.”

Gigounas resolves environmental and product-related litigation, enforcement and compliance issues on behalf of industrial, manufacturing and product-based businesses. Medlong focuses on environmental and administrative law, and regulatory compliance.