Judge Mitchell L. Beckloff, Case 22STCP01030 2023-01-06 Tentative Ruling

Judge: Mitchell L. Beckloff, Case: 22STCP01030, Date: 2023-01-06 Tentative Ruling

THE CALIFORNIA ENDOWMENT v. LOS ANGELES COUNTY METROPOLITAN TRANSPORTATION AUTHORITY

This dispute arises in the context of an unsolicited proposal by Real Party in Interest, Aerial Rapid Transit Technologies, LLC (ARTT) to Respondent, Los Angeles County Metropolitan Transportation Authority (Metro), for consideration of a project using aerial gondolas for round-trip transportation between Dodger Stadium and Union Station (the Project). Petitioner, The California Endowment, through its first amended petition for writ of mandate, requests a court order setting aside Metro’s memorandum of agreement with ARTT as well as Metro’s related sole source determination.

Metro’s request for judicial notice (RJN) of Exhibits A through C is granted as relevant context and background. Metro’s request is denied as to Exhibit D on relevance grounds.

Petitioner’s RJN of Exhibits A through M is granted in part. The court notes Petitioner has requested judicial notice of 14 documents, but Petitioner appears to rely on only seven of them in its reply—Exhibits B, D, F, G, K, L and M. The court denies Petitioner’s RJN on the basis of relevance as to Exhibits A through C and E through M. The court grants judicial notice of Exhibit D only.

Petitioner’s objection to post-decision documents contained in the administrative record (Tabs 28 through 37, 89 through 100) is sustained. (The court notes the documents—even if included in the administrative record—are immaterial to the court’s decision herein.)

On April 25, 2018, ARTT submitted an unsolicited proposal to Metro for evaluation by Metro’s Office of Extraordinary Innovation (OEI) pursuant to Metro’s Unsolicited Proposals Policy (the Policy). (AR 1-26.) On June 11, 2018, Metro advised ARTT it had concluded its Phase I analysis of the proposal and would continue to evaluate it pursuant to Phase II of the Policy. (AR 36-37.)

Thereafter, on August 10, 2018, Metro requested additional information from ARTT on a range of subjects. (AR 38-187.) ARTT responded on September 26, 2018. (AR 188-237.)

On October 11, 2018, Metro advised ARTT it had completed its evaluation of the proposal. Metro wrote: “We would like to inform you that we have reached a decision ahead of schedule that the project meets Metro’s criteria for a sole source. Metro is prepared to enter into exclusive negotiations on project terms with your team.” (AR 238.)

On October 31, 2018, Metro and ARTT executed a letter of intent to “establish[] intentions for exclusive negotiations on the Los Angeles Aerial Rapid Transit Project.” (AR 239-241.) Metro’s potential involvement in the Project included a ground lease at Union Station, serving as the lead agency for purposes of the California Environmental Quality Act (CEQA)[1] and (perhaps) property acquisition though its powers of eminent domain. (AR 242.)

On December 3, 2018, Metro staff (its Chief Innovation Officer, Chief of Vendor/Contract Management and Chief Executive Officer) provided Metro’s board of directors with its memorandum justifying Metro’s sole source determination. (AR 242-251.) The memorandum explained the Project could be accomplished with services available only through ARTT based on ARTT’s capability to deliver unique services for the proposal’s unique and innovative concept. (AR 245.) More specifically,

“ARTT is on the only party capable of delivering this project because they are the only party capable of working with the Dodgers to fully integrate this project with Dodger Stadium for non-[Major League Baseball] events and Los Angeles Dodger games, just as Metro is the only party capable of truly integrating the project with Los Angeles Union Station and Metro’s transit system.” (AR 245.)

On April 26, 2019, Metro and ARTT entered into their memorandum of agreement (MOA). The MOA evidences the parties’ commitment to exclusively negotiate concerning the Project. (AR 261.) The MOA defined the Project as ARTT’s unsolicited proposal “to fund/finance, design, construct, operate, and maintain the Los Angeles Aerial Rapid Transit gondola connecting Union Station and the Dodger Stadium property.” (AR 260.) The MOA expressly states the MOA “does not constitute or evidence an approval by Metro of, or commitment of Metro to, any action for which prior environmental review is required under CEQA.” (AR 261.)

Petitioner seeks relief pursuant to Code of Civil Procedure section 1085. (FAP ¶¶ 86-91.)

Ordinary mandate under Code of Civil Procedure section 1085 is generally used to review an agency’s ministerial acts, quasi-legislative acts, and quasi-judicial decisions which do not meet the requirements for review under Code of Civil Procedure section 1094.5. (Bunnett v. Regents of University of California (1995) 35 Cal.App.4th 843, 848; Carrancho v. California Air Resources Board (2003) 111 Cal.App.4th 1255, 1264-1265.)

“may be issued by any court to any . . . board . . . to compel the performance of an act which the law specially enjoins, as a duty resulting from an office, trust, or station, or to compel the admission of a party to the use and enjoyment of a right or office to which the party is entitled, and from which the party is unlawfully precluded by such inferior tribunal, corporation, board, or person.” (Code Civ. Proc., § 1085, subd. (a).)

“To obtain a writ of mandate under Code of Civil Procedure section 1085, the petitioner has the burden of proving a clear, present, and usually ministerial duty on the part of the respondent, and a clear, present, and beneficial right in the petitioner for the performance of that duty.” (Marquez v. State Dept. of Health Care Services (2015) 240 Cal.App.4th 87, 103.)

“A ministerial duty is one that “a public functionary is required to perform in a prescribed manner in obedience to the mandate of legal authority, without regard to his or her own judgment or opinion concerning the propriety of such act.” (Association of Deputy District Attorneys for Los Angeles County v. Gascon (2022) 79 Cal.App.5th 503, 528 [cleaned up].) “Mandamus does not lie to compel a public agency to exercise discretionary powers in a particular manner, only to compel it to exercise its discretion in some manner.” (California Public Records Research, Inc. v. County of Yolo (2016) 4 Cal.App.5th 150, 177.)

In such cases, the appropriate standard of judicial review is whether the agency's action was arbitrary, capricious, entirely lacking in evidentiary support, or failed to follow the procedure required by law. (Citizens for Improved Sorrento Access, Inc. v. City of San Diego (2004) 118 Cal.App.4th 808, 814; Heist v. County of Colusa (1984) 163 Cal.App.3d 841, 846.) “[U]nless otherwise provided by law, the petitioner always bears the burden of proof in a mandate proceeding brought under . . . section 1085. [Citation.] Thus, it is petitioner's burden to establish that [the agency's] decision was arbitrary, capricious, entirely lacking in evidentiary support, unlawful, or procedurally unfair. [Citation.]” (American Coatings Assn. v. South Coast Air Quality Management Dist. (2012) 54 Cal.4th 446, 460 [cleaned up].)

Petitioner contends Metro abused its discretion when it entered into the MOA with ARTT and with its sole source determination. Petitioner argues Metro’s actions failed to comply with its applicable policies and procedures—the Policy and its Acquisition Policy and Procedure Manual (APPM). (FAP ¶¶ 61-80; AR 815 [Policy]; AR 560 [APPM].)

The Policy provides a method for Metro’s review of unsolicited proposals from third parties. The Policy requires evaluation of such proposals through Metro’s Office of Extraordinary Innovation (OEI). (AR 817, 823.) The Policy provides for up to two phases of review. At Phase I, Metro considers the proposal as a concept and whether the proposal meets the threshold requirements of an unsolicited proposal under the Policy. (AR 818.) During the Phase I analysis, Metro considers “whether to review additional and detailed information” through Phase II consideration. (AR 817.) In its Phase II evaluation, Metro considers a more detailed proposed to

“decide whether to forego the proposal, to proceed to a sole source agreement, or to pursue a competitive solicitation.” (AR 819.)

Petitioner asserts: “Metro is bound by a strict regime of state statutes limiting its authority to public transportation and limiting its discretion to enter into contracts without competitive bidding.”[2] (Opening Brief 6:3-5.) Petitioner contends the Policy permits Metro to consider unsolicited proposals from third parties only where the proposed project “aids public transportation” and meets other requirements under the Policy. (Opening Brief 6:10-12 [citing AR 555].) Petitioner argues “OEI improperly used a combination of unsolicited proposal and sole source (i.e., non-competitive) bidding processes to accept a wholly privately funded non-public proposal by [ARTT] . . . .”[3] (Opening Brief 6:13-17.)

Petitioner argues Metro could not “accept” (that is, consider) ARTT’s unsolicited proposal under the Policy. Petitioner asserts Metro’s consideration is inconsistent with the Policy because the proposed Project is entirely private, and Metro is permitted to accept only projects that “aid[] public transportation . . . .” (Opening Brief 6:11.) Petitioner later clarifies the “aid to public transportation” requirement is “is necessary but not sufficient.” (Reply to Metro 7:9-10.) Petitioner explains, “Projects adopted by Metro as public transportation, as distinguished from private common carriers, must also be eventually owned and controlled by Metro or some other public agency.” (Reply to Metro 7:10-12.)

Petitioner relies on the Public Utilities Code to bolster its argument. Petitioner argues the Public Utilities Code limits Metro to managing public transportation. According to Petitioner, the Project does not qualify as a “public transportation” project because it is privately owned and services a single destination.[4] Therefore, Metro’s OEI may not consider the unsolicited proposal and has no authority to exempt the Project from competitive bidding.

“Unlike other Metro projects, the [aerial rapid transit] is a privately funded/financed, designed, built, operated, maintained, and insured conveyance to a private property that is open to the public. Like Dodger Stadium, the [aerial rapid transit] system will be open to the [paying] public for certain events and activities, but not publicly owned.” (AR 206.)

Metro persuasively disputes Petitioner’s claim the proposed Project does not aid public transportation. Metro argues Petitioner’s view of “public transportation” is unduly restrictive.[5] The court agrees.

As Metro notes “its primary purposes is to foster the movement of people in and around the Los Angeles area for the benefit of the County and State.” (Metro Opposition 4:28-5:1; see also Pub. Util. Code, § 30001, subd. (a). [“Diminution of congestion on the streets and highways in Los Angeles will facilitate passage of all Californians motoring through the most populous area of this state . . . .”]) In fact, Metro expressly determined the proposed Project would potentially further Metro’s goal of “[]carrying people from Union Station to Dodger Stadium car-free[] . . . fulfilling the Vision 2028 goal of doubling non-drive-alone trips in the next 10 years.” (AR 294-295.) The evidence also demonstrates the proposed Project “significantly improves mobility in and around the Dodger Stadium property by providing alternative access to the facility resulting in up to between a 20 to 25% reduction in private automobile trips to and from the stadium on an average game day, thereby reducing existing traffic for the benefit of surrounding communities and neighborhoods.” (AR 209.)

“ . . . has the potential to reduce congestion in the neighborhoods surrounding the Stadium during games and events, attract choice riders to the Metro system, leverage all the lines Union Station serves as a way of getting to the game, and turn car trips into transit trips thus increasing mobility. Because the capacity of the stadium is fixed, it would not induced demand and because of this could improve traffic. Each of these benefits is expected, but the extent of them is unknown . . . .” (AR 248.)

Metro’s implied finding the proposed Project would aid in public transportation is amply supported by the evidence. Petitioner has not met it burden of demonstrating Metro’s finding that the proposed Project would aid public transportation is arbitrary, capricious or unsupported by the evidence.

From the court’s perspective, Petitioner’s argument is misfocused. Importantly, Metro did not “accept” or approve any proposed Project. Metro considered ARTT’s unsolicited proposal and thereafter committed to exclusively negotiating with ARTT in the MOA. Metro also decided, after considering ARTT’s proposal, the Project, if later approved, would not be subject to competitive bidding.[6] Petitioner has not identified how Metro’s acts “accept[ed]” a project in violation of the Public Utilities Code, the Policy or the APPM.[7]

Petitioner’s legally unsupported assertion—“Projects adopted by Metro as public transportation, as distinguished from private common carriers, must also be eventually owned and controlled by Metro or some other public agency”—is belied by Metro’s own policies. (Reply to Metro 7:10-13.) Metro follows an express policy for its approval of “all non-Metro public transportation facilities within Los Angeles County.” (AR 555.) Metro defines non-Metro transportation facilities “as public transportation facilities that are planned, designed, constructed, maintained and operated by any private entity within Los Angeles County.” (AR 555.) Metro’s policy “addresses the requirements of any proposed non-Metro public transportation facility that is brought to [the] Metro Board for approval.” (AR 555.)

While “non-Metro public transportation facilities” might be limited to some governmental entity other than Metro, Metro’s policy expressly makes clear otherwise in its discussion of background to the adoption of the policy:

“Recently, there has been proposals by non-Metro private entities to build public transportation facilities within Los Angeles County. For example, underground tunnels have been proposed to transport public to Dodgers Stadium to and from various Metro transit stations. This tunnels building concept has come from The Boring Company, which is a private entity. Metro, currently does not have a formal policy in place for approval of such projects as these types of projects are unprecedented. It is therefore necessary to establish such a formal policy to obtain sufficient information for the Metro Board to review and approve current and any future non-Metro public transportation project proposals.” (AR 555.)

Similarly, Petitioner argues the proposed Project does not qualify as a joint development project pursuant to a public-private partnership under Government Code section 5956.6 because the Project is excluded under Government Code section 5956.4.[8] (See also 49 U.S.C. § 5302.) As noted earlier, Metro concedes the proposed Project is not a public-private partnership project.

The Policy, however, is not limited to unsolicited proposals for public-private partnership with Metro. The Policy expressly—and separately—defines an unsolicited proposal for joint development as:

“a written proposal that is submitted to Metro on the initiative of a prospective offeror (organizations or individuals) (‘Offeror’) for the purpose of developing a partnership that is not in response to a formal or informal request issued by Metro. For the purposes of the Unsolicited Proposals & Public/Private Sector Engagement Policy (‘UP Policy’), as well as the Metro Joint Development Program: Policies and Process document (‘JD Policy’), a Joint Development (‘JD’) Unsolicited Proposal would seek the right to develop or improve property owned by Metro.” (AR 850.)

Finally, Petitioner concedes Metro, as a regulatory body, may review the proposed Project for compliance with applicable laws. According to Petitioner, however, “review of a project is different from what Metro has purported to do here: i.e., accepting ARTT’s proposal as Metro’s own project and holding it out to the public as a Metro project. The Project was not proposed or approved as a public mass transit project. Public Utilities Code section 130051.12 provides no authority for Metro to accept a private project as its own.” (Reply to Metro 9:21-27.)

Petitioner’s fact-based argument distracts from its overall legal premise. Petitioner has not demonstrated Metro acted in an arbitrary or capricious fashion or was without legal authority to consider ARTT’s unsolicited proposal. Petitioner has not demonstrated the proposed Project would not aid public transportation and did not qualify for consideration under the Policy. Further, there is no evidence Metro has approved any mass transit project. Nothing suggests Metro has “accept[ed] a private project as its own.”[9] (Reply to Metro 9:27.)

Petitioner also argues even if the proposed Project is within Metro’s authority to consider, “Metro may not accept it as an unsolicited proposal because it does not meet the requirements for such a proposal, including that it demonstrate economic feasibility based on costs and revenues, be espoused by a proponent with the necessary experience and qualifications to carry it out, and be unique and innovative.” (Opening Brief 7:11-15.)

First, Petitioner contends Metro violated the Policy by considering the unsolicited proposal despite ARTT having failed to demonstrate the financial viability of the proposed Project during Phase I of Metro’s consideration. More specifically, Petitioner argues ARTT’s unsolicited proposal did not warrant consideration because ARTT did not commit itself to directly finance construction or operation of the aerial gondola and failed to identify any specific sources of third-party private financing for the proposed Project. Instead, ARTT’s unsolicited proposal generally revealed ARTT “will obtain third-party financing for the capital construction of the Project.” (AR 2.)

Metro explains the Policy sets forth factors Metro’s Phase I evaluation “generally will consider,” although the “evaluation team . . . will determine the evaluation criteria, as necessary, to reflect the specific proposal.” (AR 819.) Thus, Metro’s evaluation is flexible and based on the particular circumstances of the unsolicited proposal.[10]

The Policy’s language suggests flexibility and discretion for Metro when considering the financial viability of an unsolicited proposal in the Phase I analysis. In fact, the Policy itself requires no specific information from a third party for Phase I consideration. Rather, Phase I’s evaluation criteria merely acknowledges an unsolicited proposal may include a financial component. (AR 818 [financial evaluation team has access to proposal to determine project scope].)

Here, ARTT stated in its unsolicited proposal (and Metro considered in its Phase I evaluation):

“The Proposer commits to obtain third party private financing for the capital construction cost of the Project as proposed, as well as to privately operate and maintain the ART system. As noted above, this commitment is based on the direct route with two stations, but we would be happy to coordinate on potential additional points of access if other sources of funding are available. The Proposer is deeply committed to this innovative project and fully capable of meeting all funding commitments.” (AR 16.)

Thereafter, OEI’s expert team reviewed the proposal and advanced it to Phase II analysis. (AR 294.)

There is no showing by Petitioner of Metro’s failure to comply with a ministerial mandatory duty in advancing the unsolicited proposal for Phase II evaluation based on Metro’s consideration of the financial details submitted by ARTT in Phase I. That is, the court agrees Metro did not violate an identified mandatory, nondiscretionary, ministerial duty when it advanced consideration of ARTT’s unsolicited proposal from Phase I to Phase II because ARTT did not include more detailed financial information in its proposal. The Policy expressly builds into it discretion for Metro’s OEI based on the circumstances presented. (AR 819.)

The court makes the same finding as to Metro’s decision to negotiate with ARTT after its Phase II evaluation. Petitioner asserts, under the Phase II criteria, ARTT was required to submit “a detailed proposal” that “at a minimum,” included the following information:

“Technical Information: . . . v. Proposed price or total estimated cost for the effort and/or the revenue generated in sufficient detail for the meaningful evaluation and cost analysis including a annual cash flow for the project and . . . costs to operate and maintain; . . . .

Supporting information: Information, in the form of Metro’s Pre-Qualification Application [] demonstrating . . . that the proposer has the necessary financial resources to complete the project, as determined by Metro and OEI staff.”

(AR 820; AR 613. [“The proposed price or total estimated cost for the effort in sufficient detail for meaningful evaluation.”])

Petitioner contends ARTT’s information does not demonstrate ARTT’s financial capability to complete the Project in a manner that satisfies the Policy’s Phase II requirements. Petitioner asserts Metro deferred ARTT’s submission of the financial information. (AR 338.) Petitioner argues ARTT failed to provide the actual cost of the Project to Metro, noting the sum of $125 million identified in the proposal omits acquisition costs for the “Dodger Stadium Land Cost” and “Union Station Ground Lease.” (AR 235.)

Petitioner is correct. ARTT did not provide land or ground lease costs to Metro in connection with Metro’s Phase II analysis. (AR 235.)

Under the Policy, Phase II requires “[p]roposed price or total estimated cost for the effort and/or the revenue generated in sufficient detail for meaningful evaluation and cost analysis, including an annual cash flow for the project and annual or future costs to operate and maintain . . . .” (AR 820.) Thus, the Policy permitted ARTT to submit the estimated cost or the revenue generated. ARTT, however, provided both—the estimated cost and revenue sources. (AR 225-227, 235.)

The Policy, however, merely requires an estimate be considered in Phase II. Metro received an estimate; the estimate contained omissions. Nothing suggests, however, Metro could not exercise its discretion and consider ARTT’s estimate—in spite of its omissions.

In fact, Metro understood ARTT did not provide certain financial information to it. ARTT’s unsolicited proposal explained it could not determine or estimate a ground lease cost (as well as others) because ARTT needed information from Metro. ARTT could not know “Metro's requirements for leasing an [aerial rapid transit] station location at Union Station, together with reimbursement arrangements for Metro as lead for project approval process, including CEQA review and actions needed for ART route selection.” (AR 21.) As noted by Metro, “Once the design details have been further advanced and the potential use of Metro property is better defined, Metro will appraise the fair market value of its property at Union Station proposed for Project use.” (AR 1066.) Thus, the information omitted by ARTT was information generally known by and available to Metro.

ARTT also advised Metro it had not identified available sites at Dodger Stadium for use as a station. (AR 209. [“ARTT LLC and the Los Angeles Dodgers are coordinating to identify available sites at the Dodger Stadium property to locate an [aerial rapid transit] station.”]) Thus, the specifics related to land at Dodger Stadium was then unascertainable by ARTT.

Metro’s reliance on an estimate—albeit with omissions—for consideration of ARTT’s unsolicited proposal in Phase II was not arbitrary or capricious. It was well within Metro’s discretion—nothing required Metro to reject the unsolicited proposal because of the omissions.

Petitioner also complains ARTT failed to identify the key financial partners for the Project. The Policy, however, does not require key financial partners. Instead, the Policy requires disclosure of key financial partners where they exist. ARTT stated:

“ARTT LLC has the necessary financial resources to fund the Project and is planning to do so through environmental review and permitting, at that time, the market offers availability of third-party private financing for the capital construction cost of the Project as proposed, so ARTT LLC can assess whether additional financial partners may become involved.” (AR 204 [emphasis added].)

ARTT’s disclosure appears consistent with the Policy. Petitioner has not demonstrated otherwise.[11]

Finally, Petitioner argues an ordinance[12] requires a Pre-Qualification Questionnaire be provided to Metro for consideration of unsolicited proposals. (AR 2291.) Petitioner notes ARTT failed to submit the questionnaire. (AR 233.)

ARTT expressly requested the Pre-Qualification Questionnaire for its unsolicited proposal be omitted. ARTT explained to Metro:

“Metro’s Pre-Qualification Requirements are identified in the context of projects to be issued for public bids, while ART LLC has requested Metro to consider its request for a sole source determination. As described above, since no public funds are requested from Metro, and full reimbursement of services is proposed through a services agreement, we seek to proceed to an ENA as quickly as possible.” (AR 233; see also AR 551 [“Fill out and submit a Pre-Qualification Application for any proposal that would result in a contract of $100,000 or greater.”]; see also AR 840.)

Metro exercised its discretion and agreed with ARTT. Metro reasoned the unsolicited proposal did not request or require Metro funding to finance, design, build, operate, or maintain the proposed Project. Instead, the proposal requested Metro’s consideration of a potential aerial rapid transit station at Union Station and Metro’s service as a lead agency for CEQA. (AR 169, 199.) Metro’s decision to excuse ARTT’s failure to submit a Pre-Qualification Questionnaire was not arbitrary and capricious and reasonable under the circumstances.[13]

Petitioner also argues ARTT’s proposal failed to demonstrate the experience necessary to carry out the proposed Project. Petitioner notes under Phase II of the Policy, the proposer must submit information as to its “previous experience in the field” and its “related experience.” (AR 820.)[14]

Petitioner argues ARTT did not meet the Policy’s experience requirement. Petitioner further contends ARTT cannot meet the requirement because it did not exist prior to March 2018. Petitioner complains ARTT relied on hired subcontractors with relevant experience to meet the experience requirement. (AR 17-18.)[15]

Petitioner fails to elaborate on how Metro’s reliance on ARTT’s “highly-qualified consultants with the expertise necessary to implement the Project” is inconsistent with the Policy. (AR 221-224.) Nothing suggests Metro could not reasonably exercise its discretion to determine ARTT and those it hires have the necessary technical experience to complete the proposed Project.

Finally, Petitioner argues even if the proposed Project could be accepted as an unsolicited proposal under the Policy, the unsolicited proposal does not qualify for a sole source determination because it is not unique or innovative. Therefore, according to Petitioner, the proposal should have been subject to a competitive solicitation process. That is, Metro erred when it made the sole source determination.

The Policy requires sole source approval of an unsolicited proposal be based on the proposed project’s unique and innovative characteristics. (AR 817 [“Innovative and pragmatic”], 821.)

Sole source status applies only where there is “a proprietary concept that is essential to contract performance,” i.e., there is evidence the exact proposer is the only entity capable of carrying out the proposed project. (AR 855.) The Policy also specifies “[a] sole source award may not be based solely on the unique capability of the proposer to provide the specific property or services proposed.” (AR 855; see AR 667)

Petitioner contends the proposed Project is not unique and innovative because, as recognized by ARTT in its unsolicited proposal, there are several aerial gondola systems in operation in the United States as well as various countries around the world. (AR 11-12; see also, AR 210.) Petitioner demonstrates Metro knew many aerial gondola systems were currently being proposed, used, or studied for feasibility (AR 792; AR 911 [Metro press release “ARTT revived the concept”].)

Based on the existing aerial gondola systems and Metro’s knowledge of same, Petitioner contends Metro erred in finding the proposed Project was unique and innovative. Metro’s error, according to Petitioner, requires the proposed Project be subjected to competitive bidding and not a sole source contract.

Metro justifies its unique and innovative decision based on evidence. (AR 245-246.) Metro notes the proposed Project would be the first urban aerial gondola system in the country to employ “a Tricable Detachable Gondola (3S) system (the most advanced technology currently available).” (AR 7; see also AR 214 [describing the 3S system].) In addition, the evidence demonstrates there is no similar aerial gondola system in use in the United States. While such systems apparently exist outside the United States, there are very few in the world.

Metro’s finding the proposed Project is unique and innovative is not arbitrary and capricious. The decision is supported by the evidence. Metro’s interpretation of its Policy and whether the proposed Project is unique and innovative is not unreasonable.

Petitioner’s claim is based on the legal theory a court may “direct an agency to follow its own rules when it has a ministerial duty to do so or when it has abused its discretion.” (Opening Brief 11:6-8 [citing Pozar v. Department of Transportation (1983) 145 Cal.App.3d 269, 271].) ARTT argues Petitioner has failed to state a claim because the court cannot compel Metro to comply with each provision of the “staff-adopted” Policy.

It is well established that “absent a clear duty imposed by law . . . mandamus is not a proper vehicle for resolution for the asserted grievance.” (Shamsian v. Department of Conservation (2006) 136 Cal.App.4th 621, 640.)

ARTT’s position is unpersuasive.[16] Nothing suggests Metro is not required to comply with its own policies. While a duty expressed in the Policy may be discretionary and for that reason not enforceable by mandate, the duty nonetheless exists.

Petitioner also notes ARTT’s argument ignores Petitioner’s reliance on the APPM (Opening Brief 6, 8, 10-12, 15-18, 20), Metro’s ordinance (AR 2291), the Public Utilities Code (Opening Brief 6, 7, 8, 12, and 17), and the Government Code (Opening Brief 12, 14, 17, and 18). Thus, ARTT has not demonstrated every source of duty is inapplicable under the circumstances here.

Finally, ARTT contends invalidating the MOA does not preclude Metro from continuing with the proposed Project’s environmental review. While seemingly true, invalidating the MOA would terminate the obligations between the parties crated by the MOA.

Pursuant to Code of Civil Procedure section 1086, Petitioner must demonstrate a beneficial interest in the outcome of the proceedings. (Code Civ. Proc. § 1086.) That is, Petitioner must have “a clear, present and beneficial right” to the performance of the duty allegedly owed by Respondent. (California Assn. of Medical Products Suppliers v. Maxwell-Jolly (2011) 199 Cal.App.4th 286, 302 [cleaned up].) Generally, a beneficial interest means a petitioner has some special interest to be served or some particular right to be preserved or protected over and above the interest held in common with the public at large. (Save the Plastic Bag Coalition v. City of Manhattan Beach (2011) 52 Cal.4th 155, 166.)

ARTT contends Petitioner has no beneficial interest in any performance of a duty by Metro that is something other than the duty owed by Metro to the general public. ARTT challenges Petitioner’s standing to bring this proceeding.

ARTT contends Petitioner has not demonstrated it has standing to challenge Metro’s execution of the MOA. ARTT contends Petitioner’s mission is unrelated to building and operating aerial gondolas. ARTT reports Petitioner is “a private foundation dedicated to expanding access to affordable quality healthcare for underserved individuals and communities” and “provides below-market office space to local non-profit organizations.” (FAP ¶ 4.)

Petitioner disputes ARTT’s lack of standing claim. Petitioner asserts it has both beneficial interest standing and public interest (citizen) standing. Additionally, Petitioner also claims it has taxpayer standing under Code of Civil Procedure section 526a, subdivision (a)(2).

With respect to the beneficial interest standing, Petitioner claims it will suffer a particularized harm from the proposed Project. The proposed Project would place a station, with a 195-foot tall tower supporting the gondola, immediately adjacent to Petitioner’s headquarters. (FAP ¶¶ 4, 81. [“The Endowment’s offices, non-profit tenants, and the Center for Healthy Communities (which provides free conference space to non-profit grantees and public sector institutions throughout Los Angeles County) will be severely impacted by the construction and disruption along Alameda Street.”]) Thus, Metro’s consideration of the proposed Project through the MOA directly impacts Petitioner’s interests.

The court notes “[t]he beneficial interest standard is so broad, even citizen or taxpayer standing may be sufficient to obtain relief in mandamus. ‘[W]here a public right is involved, and the object of the writ of mandate is to procure enforcement of a public duty,’ a citizen is beneficially interested within the meaning of Code of Civil Procedure section 1086 if ‘he is interested in having the public duty enforced.’ [Citation.]” (Mission Hospital Regional Medical Center v. Shewry (2008) 168 Cal.App.4th 460, 480.) This public interest exception “promotes the policy of guaranteeing citizens the opportunity to ensure that no governmental body impairs or defeats the purpose of legislation establishing a public right.” (Driving Sch. Assn. of Cal. v. San Mateo Union High Sch. Dist. (1992) 11 Cal.App.4th 1513, 1518, 14 Cal.Rptr.2d 908.)

Petitioner has demonstrated an interest in challenging Metro’s actions with ARTT’s unsolicited proposal that is beyond the public at large. (FAP ¶ 81.) The verified petition supports a finding Petitioner will be directly impacted by the construction, maintenance and operation of the proposed Project. The MOA provides a step towards the potential later approval of the proposed Project. Such interest is sufficient to satisfy the beneficial interest requirement in traditional mandamus.[17]

Metro issued its sole source determination in October 2018. It entered into the MOA with ARTT in April 2019. Petitioner filed this proceeding in March 2022.

ARTT contends Petitioner unreasonably delayed bringing this proceeding such that laches precludes Petitioner from obtaining any relief. The defense of laches requires: “(1) an omission to assert a right; (2) a delay in the assertion of the right for some appreciable period; and (3) circumstances which would cause prejudice to an adverse party if assertion of the right is permitted.” (See Stafford v. Ballinger (1962) 199 Cal.App.2d 289, 296)

ARTT argues it and Metro have invested tremendous resources toward the proposed Project’s environmental review. ARTT explains Metro has released a 7,877-page draft environmental impact report and it is out for public review and comment. (Metro RJN, Ex. A.) Based on ARTT’s expenditures (with Metro’s expenditures reimbursed by ARTT), ARTT contends it and Metro will suffer extreme prejudice if Petitioner obtains any relief in this proceeding.

The court is unpersuaded on the evidence submitted. While a reasonable inference can be drawn about the time and expense expended to create a 7,877-page report, the court cannot determine the extent of prejudice actually suffered. Moreover, whether the report is completely unusable if the MOA is set aside is unclear. In fact, it seems otherwise. Setting aside the MOA would not preclude Metro from completing its environmental review of the proposed Project.

[1] CEQA is found at Public Resources Code section 21000 et seq.

[2] To be sure, Metro has not entered into any contract with ARTT except the exclusive negotiating agreement, the MOA.

[3] For clarity, Metro agreed to consider ARTT’s unsolicited proposal through the Policy. The Policy allows Metro to “accept” all unsolicited proposals from third parties. Thus, Metro’s acceptance of the unsolicited proposal is consistent with the Policy. Petitioner argues Metro violated the Policy by giving any consideration to ARTT’s unsolicited proposal and by failing to reject it outright.

[4] That the Project, if consummated, would be privately owned, precludes it from status as a public-private partnership. Metro acknowledges as much and does not contend the Project would be a public-private partnership.

[5] The Public Utilities Code defines “public transportation” as “any system of an operator which provides transportation services to the general public by any vehicle which operates on land or water, regardless of whether operated separated from or in conjunction with other vehicles.” (Pub. Util. Code, § 99210.) An “operator” is defined under the Public Utilities Code as “any transit district, included transit district, municipal operator, included municipal operator, or transit development board.” (Pub. Util. Code, § 99210.) “’[P]ublic transportation’— (A) means regular, continuing shared-ride surface transportation services that are open to the general public or open to a segment of the general public defined by age, disability, or low income.” (49 U.S.C. § 5302, subd. (15)(A).) The ordinary definition of “aid” is “to give assistance.” (www.merriam-webster.com/dictionary/aid)

[6] As noted, the MOA expressly provides the Project has not been approved and could not be approved until sometime after environmental review. (AR 261.)

[7] Petitioner raises a new issue in reply: “Metro’s October 2018 acceptance of the Project (AR 238), its sole source determination for ARTT (AR 238), and its locking into exclusive negotiations (AR 261) with ARTT that forecloses alternatives are exactly the sort of approvals that lend “bureaucratic momentum” to a Project, are viewed as early project approvals, and are prohibited by the Supreme Court prior to completion of CEQA environmental review.” (Reply to Metro 6:19-25.) Petitioner’s CEQA-based argument exceeds the scope of its petition and is late thereby unfairly precluding response by Metro or ARTT.

[8] Petitioner misinterprets Government Code section 5956.4’s specification of the types of public-private partnership projects an agency may pursue. Contrary to Petitioner’s interpretation, the statute does not preclude public-private partnership projects for commuter, light rail, or other public transit that may run to a stadium, but rather stadiums, arenas, and other buildings for sporting events. (See Gov. Code, § 5956.4, subd. (p), (i).)

[9] It is not entirely clear to the court what it means for Metro to accept a private project as its own.

[10] Petitioner omits the entirety of the criteria specified by the Policy that Metro may consider at Phase I. The Policy provides consideration of various factors, including: “If the proposal contains significant financial, technical and legal components, those disciplines have approved an action that proceeds to Phase Two . . . .” (AR 819.)

[11] Metro appears to have understood ARTT is funded by Frank McCourt, former owner of the Los Angeles Dodgers. (See AR 245.) To the extent it did not know about McCourt, Metro did not err in accepting ARTT’s representation about key financial partners.

[12] Petitioner refers to Metro’s Administrative Code and section 4-05-050 specifically. (See SAR 2170, 2291.)

[13] To the extent Petitioner contends the ordinance does not vest Metro with any discretion to waive the Pre-Qualification Questionnaire, the court finds MTA’s Administrative Code at section 4-05-050 does not apply as Metro is not awarding any contract to ARTT. (SAR 2293. See Metro’s Administrative Code section 4-05-060.)

[14] Petitioner suggests the information is required under Government Code section 5956.5, which states “The competitive negotiation process shall utilize as the primary selection criteria, the demonstrated competence and qualifications for . . . developing, financing, construction, maintenance, . . . or operation, or any combination thereof, of the facility.” (Gov. Code, § 5956.5.) Under these circumstances, the statute appears inapplicable.

[15] Petitioner also cites AR 854 to suggest ARTT was required to have three similar past project experiences, but the Policy at AR 854 concerns a proposer’s ability to finance/obtain financing for a proposed Project rather than prior technical project experience.

[16] Even if the court considered Exhibit D of Metro’s RJN, the evidence is unhelpful; it does not specifically address the issue.

[17] Given the court’s finding that Petitioner has a beneficial interest, the court need not address Petitioner’s other grounds for standing.