Fresno's planning fails three court tests

Interest groups and government agencies are successfully suing the city of Fresno, winning cases that raise questions about how the city protects the public from the effects of development.

The lawsuits, filed under the California Environmental Quality Act, have accused the city of failing to fully consider air pollution, traffic, historic buildings and other factors when approving development.

Since the start of 2005, 10 CEQA actions against Fresno have been decided, and the city won just once. Fresno settled six cases and lost three -- the losses coming in appellate court decisions made during a 14-month period ending in May.

The string of higher-court rulings, including a decision on the Fresno 40 project in northeast Fresno, suggests the city isn't always following the law, experts said. Some critics of the city have made that complaint for years.

"If I was the planning director, one appellate ruling would have me scratching my head," said Mike McCoy, co-director of the Information Center for the Environment, at the University of California at Davis. "Three would have me in the city manager's office defending my job."

But Nick Yovino, who recently retired as Fresno's planning director, said the court decisions aren't the result of problems in the Planning and Development Department. The department handles most of the city's environmental reviews.

"Everything we do is in compliance with CEQA," Yovino said, even though two of the appellate rulings involved his department. The third case was handled by the city's Redevelopment Agency.

City Council Member Jerry Duncan said the court rulings didn't convince him of the need to change the city's review process.

"We could probably make sure we never have a CEQA challenge, but it would probably add a year to each project," he said. "I don't want us to shut down our economy."

City Attorney Jim Sanchez, however, said the city has refined its development reviews as a result of CEQA decisions. The city pays greater attention to historic properties, and what development means for air quality and traffic, among other things, he said.

The city has spent about $100,000 on legal fees for lawsuits filed over the relocation of historic homes for a redevelopment project downtown, Sanchez said. But typically the city spends less than $10,000 on legal fees for CEQA cases.

Former City Council Member Tom Boyajian said the city doesn't worry much about the cost of CEQA challenges. An attorney who served eight years on the council before leaving in 2006, Boyajian often voted against development proposals, saying the city hadn't met CEQA requirements.

"It was like a badge of honor at the city not to follow CEQA," he said. "The city is like a prostitute who knows she's going to get caught a few times and considers it the cost of doing business."

Fewer reviews in Fresno

Government agencies must review all development proposals to see whether CEQA applies. If it does, the agency decides whether the project will likely have significant environmental effects.

A finding of significance leads to a more detailed study, which can upset developers. The study can take nine months to a year to complete and cost the developer up to $20,000, city officials said.

Fresno finds that projects are likely to produce significant effects far less often than other similar-sized cities in California, The Fresno Bee found in an analysis of CEQA records sent to the state.

In a 10-year period ending in July, Fresno required a full environmental review for nine out of 73 projects, or 12% of the time, according to the CEQA database.

By comparison, California's 20 biggest cities, except Los Angeles and San Diego, required a full environmental review for 26% of projects.

The results seem to indicate that Fresno is reluctant to require a full review, said McCoy of the Information Center for the Environment, which maintains the database.

Environmental violations

Appellate courts repeatedly have found fault with the city's CEQA standards:

In April 2007, an appellate court tossed out the city's approval of a shopping center proposed on North Friant Road near Highway 41. The Woodward Park Homeowners Association sought the decision for the property known as the "Fresno 40," referring to its acreage.

The city erred by allowing developer DeWayne Zinkin to pay just $44,000 for the traffic the shopping center would add to Highway 41, when Caltrans estimated the fee at $307,000, the court said. Fresno's decision would leave the public "holding the financial bag," the court said.

As a result, the city failed to make a reasonable effort to offset the effects of development, a key CEQA requirement, the court said.

The city violated the other key part of CEQA by failing to inform the public about the likely effects of the shopping center, the court found.

The court said the city's reviews were "deeply flawed": Instead of comparing the project's expected effects against existing conditions, the city wrongly based its review on a comparison with a "massive hypothetical office park," creating a "misleading report." The city staff misrepresented findings to the City Council, which received them at the last minute, the court said.

More than a year after the ruling, Terry Rivasplata, former director of the State Clearinghouse, an agency responsible for reviewing CEQA filings, recalled specifics of the decision.

"It just gives you pause about how the city is handling CEQA," said Rivasplata, a planning consultant in Sacramento. "It suggests problems to me -- not keeping up with case law, for instance. Ignoring the Caltrans recommendations for another."

Yovino and Sanchez said the city will make sure the mistakes aren't repeated in the next review of the project, due next year. The Planning Commission and the City Council will have to vote again on the project, having first approved it five years earlier.

In February of this year, an appellate court ruled that Fresno botched another environmental review. The review, which found a downtown apartment building wasn't historic, would have allowed developers to tear it down for a parking lot.

City staff mistakenly used an earlier decision by the City Council to not list the building on the city's historic register, when a separate decision was needed under CEQA, the court said.

CEQA has a different standard than the city's historic register, the court said, and the circumstances of the city's initial decision also made the question worth revisiting. The council voted 4-3 to exclude the building from the register when the city's preservation manager and preservation commission had unanimously recommended its inclusion.

The city is waiting to find out whether the developers want to go through the review process a second time.

In May, an appellate court found yet more errors in a city review of historic property -- homes that stand in the way of a proposed parking garage for the Old Armenian Town redevelopment project downtown. Preservationists want to keep the homes in Old Armenian Town, saying they represent an important part of the city's history.

An initial report by the city found that developers couldn't build the parking garage where they wanted, because the relocated historic homes would need to go there, the court's ruling says.

Nevertheless, the city proceeded with the developers' plans for the parking garage, ignoring what its own review had found earlier, the court said.

The city "never justified its abandonment of the previously adopted mitigation measure, and no substantial evidence supports the change," the court said.

The future of the parking garage, originally approved in 2002, is now in doubt. Without the garage, the developers might also abandon plans to build retail and office space there. The city is waiting to see whether the developers want to proceed.

Lawsuits get response

CEQA can invoke strong feelings. Developers worry about costly delays and additional requirements. Interest groups worry about their various causes. And the city tries to sort out the competing concerns.

"CEQA is like abortion -- you have your proponents and opponents," said Moses Stites, who reviews CEQA cases for the state Public Utilities Commission. "CEQA is very controversial."

Until he left in July, Stites reviewed CEQA cases for 18 years at the state Department of Transportation district office in Fresno. He often butted heads with city officials, trying to get Fresno to collect fees from developers for projects that would add traffic to highways.

In one case, developer Ed Kashian had a highly publicized dispute with Yovino over how the city would review his Fancher Creek development. When completed, Fancher Creek will put 700 homes and a shopping center on 500 acres in southeast Fresno.

City staffers initially recommended approval of the project without a full environmental review. Fancher Creek would not have a "significant effect on the environment," the city's 2002 report says.

But when environmental attorney Patience Milrod and then-Planning Commission Member Lee Brand complained that the project was being reviewed in segments instead of as a whole, the developers withdrew their request to have the environmental review approved.

Yovino later met with Kashian to discuss how the city would review the project. At the time, Yovino said Kashian twice threatened to have him fired, although Kashian said he was just joking.

"I did not take it as a joke because it didn't seem funny," Yovino said at the time.

The city staff eventually required a full environmental review of Fancher Creek, which was approved by the City Council.

Milrod, representing a group of doctors called Medical Advocates for Healthy Air, challenged the council's decision in Fresno County Superior Court. The group accused the city of failing to fully consider a number of environmental effects, including air quality and traffic.

CEQA requires cities to consider the concerns of the public and other government agencies before making a finding. But Milrod and others said they've had to sue to get Fresno to listen.

The city and the Fancher Creek developers settled the lawsuit, agreeing to conduct a transportation study and install emission-control devices on some city buses, among other things.

Caltrans also got a better response from Fresno by going to court, Stites said. Caltrans sued Fresno in 2004 over fees for increased highway traffic from new development.

Previously, Caltrans had only sued Irvine over the highway fees, but has since filed lawsuits against Monterey County and Elk Grove, according to the department's public affairs office.

Fresno also settled two cases filed by Madera County in recent years over concerns about traffic from two shopping centers approved by the city.

Fresno settled the Caltrans lawsuit, too, agreeing to a formula to determine how much the city should collect from developers for highway fees. Stites said he spent less time haggling with the city as a result.

"When I first started at Caltrans, Fresno didn't stack up very well," Stites said. "Toward the end of my time there, things had changed 1,000%. ... I saw a lot of changes after the lawsuit."