Marketing departments in major corporations love to describe products as “new and improved” in order to convince you that the product is something you need. In many cases though, you already have the product; the new and improved version is actually the same with just a few minor changes.

On September 19, 2016, the California Supreme Court issued its opinion in Friends of the College of San Mateo Gardens v. San Mateo Community College District (Case: S214061).  In situations where a lead agency makes changes to an already approved project and decides that no further review under the California Environmental Quality Act (CEQA) (Pub. Resources Code, § 21000 et seq.) is necessary, the Court considered the question, “is the agency’s decision reviewed under a substantial evidence standard of review or is the agency’s decision subject to a threshold determination whether the modification of the project constitutes a ‘new project altogether,’ as a matter of law?”

CEQA requires subsequent or supplemental review when changes to a proposed project—for which an Environmental Impact Review (EIR) has already been completed—are substantial and require major revisions of the existing EIR (PRC § 21166). The CEQA Guidelines (Cal. Code Regs., tit. 14, §15162) also require subsequent review with this same criteria for projects adopted through a negative declaration or a mitigated negative declaration (MND).

The Petitioners, Friends of the College of San Mateo Gardens (Friends of the Gardens), argued that the changes made by the College District constituted a new project which required a new CEQA review. The brief version of the events leading to the lawsuit is that in 2006, the College District adopted a facilities master plan for its three campuses.  The plan identified the demolition of some buildings and renovation of others at the College of San Mateo.  The Building 20 Complex, which was surrounded by gardens, was identified for renovation.  The College District issued an MND and approved the project.  However, due to fiscal issues, the College District re-evaluated its plan and in 2011 decided that the Building 20 Complex and its gardens were to be demolished.  The land would be utilized for a parking lot, which of course did not sit well with Friends of the Gardens.  The College District also decided that other buildings previously identified for demolition were now to be renovated and that no further CEQA review was necessary for these changes.  Friends of the Gardens disagreed, stating that these changes created a new project requiring CEQA review, and sued the College District.

The Court of Appeal invalidated the College District’s decision, “finding it ―clearly as a matter of law that the district’s proposed demolition of the building complex was not merely a change to its previously approved project, but a new project altogether.” Well, that changes things a bit.  If the project is a new project, then wouldn’t the proponent have to start a brand new environmental review rather than being able to do a subsequent review with an existing document?  The Appellate Court said that is in fact what needs to happen…a brand new environmental review for the brand new project.  Furthermore, the Court stated that whether the changes constitute a new project is a “threshold question of law” for the Court to decide.

The California Supreme Court disagreed. In its Opinion, the Court stated that:

“the Court of Appeal erred in its application of this new project test. When an agency proposes changes to a previously approved project, CEQA does not authorize courts to invalidate the agency‘s action based solely on their own abstract evaluation of whether the agency‘s proposal is a new project, rather than a modified version of an old one. Under the statutory scheme, the agency‘s environmental review obligations depend on the effect of the proposed changes on the decision-making process, rather than on any abstract characterization of the project as ―new or ―old. An agency that proposes project changes thus must determine whether the previous environmental document retains any relevance in light of the proposed changes and, if so, whether major revisions to the previous environmental document are nevertheless required due to the involvement of new, previously unstudied significant environmental impacts. These are determinations for the agency to make in the first instance, subject to judicial review for substantial evidence.”

The Court pointed out that the purpose of CEQA is to inform the public of potential environmental effects of a proposed project. Any subsequent review of a project is to analyze impacts that were not studied in the existing document.  When determining whether an agency may proceed under CEQA’s subsequent review provisions, the Court states that the question is not whether an agency’s proposed changes render a project new in an abstract sense.  Rather the question actually “turns on the value of the new information to the still pending decision-making process…If the existing document retains some informational value despite the proposed changes, then the agency proceeds to decide under CEQA’s subsequent review provisions whether project changes will require major revisions to the original environmental document because of the involvement of new, previously unconsidered significant environmental effects.”

The bottom line is that a “new and improved” finding by the Court would have caused the College District to do a new initial study to determine whether an EIR was necessary. However, the Court found that it is the agency’s duty, and not the Court’s initial threshold, to review and determine whether project changes are substantial and require major revisions to an existing EIR document.  A change in the project does not mean that your entire EIR is useless and outdated.  Such a mandatory result would negate the possibility of preparing a subsequent or supplemental document to analyze just those portions that have changed and how the changes impact the whole of the project.  In today’s world, it can take years to develop projects and obtain approvals, and some project changes are inevitable.  Project proponents and lead agencies should seriously consider the scope of the changes in relation to the analysis of the project in the existing EIR.  If the existing document retains informational value, then consider doing a supplemental review.  In addition to costs savings, this approach does not expose the entire EIR to legal challenge again.