Judge: William D. Claster, Case: 21-01178477, Date: 2023-09-01 Tentative Ruling
Petitioners Laguna Beach Historic Preservation Coalition, Preserve Orange County, and Village Laguna's Notice of Motion and Motion for Stay and Preliminary Injunction ROA 171
In the prior minute order, the Court directed Petitioners Laguna Beach Historic Preservation Coalition, Preserve Orange County, and Village Laguna to file the negative declaration at issue and sought supplemental briefing from Petitioners, Respondent City of Laguna Beach, and Real Party in Interest (RPI) 1902 Ocean Way, LLC. The City and RPI elected to file a joint supplemental brief. Upon review of all filings related to Petitioners’ motion for a preliminary injunction, the motion is DENIED.
I. Factual and Statutory Background
This is a CEQA challenge to the City’s adoption of its new Historic Resources Element, part of its overall updated Historic Preservation Program. As described in more detail below, the City previously had a Historic Resources Inventory listing several hundred properties considered to be of historical significance. Under the new Historic Resources Element, the old Historic Resources Inventory is abolished and replaced with a voluntary registry that property owners may choose not to join. The City adopted the Historic Preservation Program, including the Historic Resources Element, after adopting a negative declaration rather than preparing an EIR.
These proceedings originally challenged only the Historic Resources Element itself, not any particular project approved thereunder. After Petitioners filed suit, RPI applied for, and was granted, permits to demolish and remodel a single-family home at 1902 Ocean Way in the City. Petitioners amended the petition to name RPI as a party, and also to add numerous Doe RPIs, defined in the supplemental petition as “applicants who have sought and received and have or may seek permits for demolition and substantial remodel of historic properties for which the City has failed or refused to apply prior protections of the Historic Resources Element of the General Plan following its amendment in 2021.” (Supp. Pet. ¶ 7.)
When the structure at 1902 Ocean Way had been partially demolished, Petitioners sought (and were eventually granted) a TRO, and the Court set a hearing on a motion for a preliminary injunction. After the first hearing, the Court sought additional evidence (specifically, the negative declaration itself, which was not included in any version of the pleadings or in Petitioners’ moving papers) and briefing. This ruling follows the supplemental filings.
A. Relevant Statutes
1. Defining Historic Resources
There are at least two ways a property may be officially listed as having historic significance. (As discussed below, CEQA may also protect unlisted properties.)
First is the California Register of Historical Resources. (Pub. Resources Code, § 5020.1(a). Further section references are to the Public Resources Code unless noted.) By statute, the California Register must include certain historical resources, such as properties either eligible for or formally listed in the National Register of Historic Places. (§ 5024.1(d)(1).) For other historical resources, the State Historical Resources Commission may choose to list them on the California Register if they satisfy statutory criteria. Relevant here, resources identified as significant in historical resource surveys may be listed in the California Register if all the following factors listed in § 5024.1(g) are met:
A second listing is a local register of historic resources. A local register of historic resources is “a list of properties officially designated or recognized as historically significant by a local government pursuant to a local ordinance or resolution.” (§ 5020.1(k).)
2. CEQA Protection of Historic Resources
With certain exceptions, lead agencies must prepare an EIR for “any project which they propose to carry out or approve that may have a significant effect on the environment.” (Pub. Resources Code, § 21100(a).) If a lead agency determines a project “would not have a significant effect on the environment,” it may issue a negative declaration and avoid the EIR process. (Pub. Resources Code, § 21080(c).)
As regards historical resources, Pub. Res. Code § 21084.1 provides:
A project that may cause a substantial adverse change in the significance of an historical resource is a project that may have a significant effect on the environment. For purposes of this section, an historical resource is a resource listed in, or determined to be eligible for listing in, the California Register of Historical Resources. Historical resources included in a local register of historical resources, as defined in subdivision (k) of Section 5020.1, or deemed significant pursuant to criteria set forth in subdivision (g) of Section 5024.1, are presumed to be historically or culturally significant for purposes of this section, unless the preponderance of the evidence demonstrates that the resource is not historically or culturally significant. The fact that a resource is not listed in, or determined to be eligible for listing in, the California Register of Historical Resources, not included in a local register of historical resources, or not deemed significant pursuant to criteria set forth in subdivision (g) of Section 5024.1 shall not preclude a lead agency from determining whether the resource may be an historical resource for purposes of this section. [emphasis added]
The Court finds the discussion of § 21084.1 in Valley Advocates v. City of Fresno (2008) 160 Cal.App.4th 1039, a case cited by the City and RPI, instructive. As Valley Advocates explains in detail at pp. 1051-1061 of the opinion:
Section 21084.1 creates three categories of historical resources, i.e., properties for which a substantial adverse change in their significance would be a significant environmental effect. First are “mandatory” historical resources. These are properties either listed in, or eligible for listing in, the California Register. They must be considered historical resources under § 21084.1.
Second are “presumptive” historical resources, those included in a local register or deemed significant under § 5024.1(g). But the definition of “local register” itself is disjunctive: it includes not only properties formally designated on a list, but also properties “recognized as historically significant by a local government pursuant to a local ordinance or resolution.” (§ 5020.1(k).) The “recognized as” category means that properties not formally listed on a local register may nevertheless be considered part of a local register, provided a local resolution or ordinance recognizes their significance.
Accordingly, the second category consists of (1) properties formally listed on a local register, (2) properties formally recognized as significant by a local government resolution, even if not listed on a register, and (3) properties that satisfy § 5024.1(g). For a “presumptive” historical resource, unlike a “mandatory” historical resource, the property’s historical significance can be disproven by a preponderance of the evidence.
Third are “discretionary” historical resources. The last sentence of § 21084.1 gives lead agencies the discretion to consider a property a historical resource even if it is neither a “mandatory” nor a “presumptive” historical resource. Under Valley Advocates, this discretion means, “at a minimum,” that a lead agency has the discretion to consider whether a property is historically significant even if it previously decided not to list the building on a local register.
B. Relevant Facts Surrounding Historic Resources Element
As set forth in the minutes of the December 21, 1982 City Council meeting, in connection with the 1981 revision of the City’s general plan, the City commissioned a survey of historic properties. (Kohn Decl., Ex. C, p. 31.) That survey resulted in a list of properties the parties refer to as the “Historic Resources Inventory.”
On December 21, 1982, the City Council adopted Resolution No. 82.111, titled “A Resolution of the City Council of the City of Laguna Beach Recognizing the Laguna Beach Historic Resources Inventory as a Listing of the Best Representative Examples of Historically Significant Architecture Within the City.” (Kohn Decl., Ex. C, p. 32.) The minutes reflect that the City Council did so to access grant funds that required “an officially recognized roster of historically and architecturally significant buildings.” (Ibid.)
In 2020, the City Council adopted the current General Plan, which includes the amended Historic Preservation Program, of which the challenged Historic Resources Element is a part. The Historic Preservation Program was adopted with a negative declaration.
The ordinance amending the Historic Preservation Program was supported by a staff analysis. As relevant here, City staff wrote: “It has been determined that the 1981 Historic Inventory no longer meets the requirements of Public Resources Code section 5020.1(k) because it has not been updated within the last five years. Consequently, the Inventory does not provide a presumption that properties identified are historic resources . . . .” (Kohn Decl., Ex. B, p. 27.)
As the current version of the City’s historic preservation laws now state, their “purpose” is to “achieve the following objectives,” which include “Recognize that the previous historic resource inventory (adopted by Ordinance [sic] No. 82.111) is ineffective for the purposes of creating a presumption of historicity of any property identified thereon.” (Laguna Beach Mun. Code § 25.45.002(H).) This statement tracks language in the staff report, which suggested the Code be amended to “Declare that the previous historic resource inventory (adopted by Ordinance [sic] No. 82.111) is ineffective for the purposes of creating a presumption of historicity of any property identified thereon.” (Kohn Decl., Ex. B, p. 27.)
It is undisputed for present purposes that the City’s new local register is voluntary: an owner must consent to have his or her property listed. As noted above, RPI’s project was approved by the City under the new Historic Resources Element.
II. Petitioners’ Claim
The Court understands Petitioners’ theory of the case to be as follows:
The 1981 Historic Resources Inventory was a local register under § 5020.1(k). As a result, all properties on the Historic Resources Inventory were presumptively protected under § 21084.1. The new Historic Resources Element does away with the Historic Resources Inventory entirely, replacing it with a new, voluntary local register. As a result, properties that used to be presumptively protected no longer have that presumptive protection (unless the current owner signs up for the new register). This loss of presumptive protection poses a substantial risk of adverse change in the significance of the properties listed on the Historic Resources Inventory, as seen by the permits given to RPI (and others).
Because the elimination of the Historic Resources Inventory and its replacement with the new Historic Resources Element’s voluntary register poses a risk of adverse change in the significance of the formerly listed properties, the new Historic Resources Element has a “significant effect on the environment” requiring an EIR rather than a negative declaration. Finally, because the City proceeded by negative declaration rather than EIR, its adoption of the Historic Resources Element was an abuse of discretion and must be set aside.
III. CEQA Standard of Review
In its prior minute order, the Court suggested the “fair argument” standard applied to Petitioners’ challenge to the City’s negative declaration. Under the fair argument standard, a negative declaration is appropriate only if the record lacks substantial evidence as to whether the project would have the claimed significant environmental effect. “Stated another way, if the [reviewing] court perceives substantial evidence that the project might have such an impact, but the agency failed to secure preparation of the required EIR, the agency’s action is to be set aside because the agency abused its discretion by failing to proceed ‘in a manner required by law.’” (Berkeley Hillside Preservation v. City of Berkeley (2015) 60 Cal.4th 1086, 1112 [quoting Friends of “B” Street v. City of Hayward (1980) 106 Cal.App.3d 988, 1002].)
Upon review of the parties’ supplemental briefing, the Court now concludes this prior statement was incorrect in the context of this case. Section 21084.1 allows an agency to find based on a preponderance of the evidence that a presumptive historic resource is not, in fact, a historic resource. When a negative declaration is based on such a finding, the finding is reviewed under the “substantial evidence” standard, not the fair argument standard. As explained in Friends of Willow Glen Trestle v. City of San Jose (2016) 2 Cal.App.5th 457:
A resource included in a local historical register is “presumed” historical “unless the preponderance of the evidence demonstrates” that it is not. The fact that a lead agency may find even a presumptively historical resource not to be a historical resource if “the preponderance of the evidence” supports the lead agency’s finding necessarily establishes that such a finding would not be reviewed under the fair argument standard. The inclusion of a resource in a local historical register will by itself generally create a fair argument that the resource is historical, yet the statute plainly permits the lead agency to conclude that it is not. It would make no sense for the statute to permit the lead agency to make a finding based on a preponderance of the evidence that a resource is not a historical resource if the fair argument review standard would generally result in the invalidation of that finding. By allowing the lead agency to eliminate the presumption by making a contrary finding supported by a “preponderance” of the evidence, the statute expressly selects an evidentiary standard for the lead agency’s decision that is inconsistent with that decision’s being subject to a fair argument standard of judicial review. If the lead agency’s standard for its decision is “preponderance of the evidence,” the standard of judicial review logically must be whether substantial evidence supports the lead agency’s decision, not whether a fair argument can be made to the contrary.
(Id., at pp. 467-68 [emphasis original, footnote omitted].)
Petitioners contend the City should have used an EIR instead of a negative declaration because the properties no longer protected by the old Historic Resources Inventory should be presumptively protected under § 21084.1. That is, they argue the City was wrong to conclude the properties were not historic resources. Following Friends of Willow Glen Trestle, Petitioners’ theory of the case presents a two-step process with two different standards of review.
First, because the City has concluded the properties are not historic resources in issuing the negative declaration, Petitioners must show the City abused its discretion in reaching that conclusion, i.e., that the record lacks substantial evidence to support the City’s conclusion. Second, if Petitioners satisfy the first step (i.e., the City abused its discretion in concluding the properties were not historic resources), Petitioners need only make a fair argument that the Historic Resources Element imperils the properties. On the other hand, if Petitioners fail at step one, their claim fails, at least as pled.
IV. Preliminary Injunction Standard of Review
“‘In determining whether to issue a preliminary injunction, the trial court considers two related factors: (1) the likelihood that the plaintiff will prevail on the merits of its case at trial, and (2) the interim harm that the plaintiff is likely to sustain if the injunction is denied as compared to the harm that the defendant is likely to suffer if the court grants a preliminary injunction.’” (Take Me Home Rescue v. Luri (2012) 208 Cal.App.4th 1342, 1350.)
The party seeking injunctive relief bears the burden of proof. (O’Connell v. Superior Court (2006) 141 Cal.App.4th 1452, 1481.) The first element is met by showing it is “reasonably probable that the moving party will prevail on the merits.” (San Francisco Newspaper Printing Co., Inc. v. Superior Court (1985) 170 Cal.App.3d 438, 442.) In the context of this motion, Petitioners bear the burden of showing it is reasonably probable they will be able to show the record lacks substantial evidence to support the City’s conclusion that properties on the old Historic Resources Inventory are not protected under § 21084.1.
V. Analysis
On these papers, and on this record, the standard of review is dispositive: Petitioners do not meet their burden of showing a reasonable likelihood that they will eventually show the City abused its discretion in concluding the properties on the Historic Resources Inventory were not historic resources protected under § 21084.1.
This is a result of Petitioners’ single-minded focus on the fair argument standard of review. The Court agrees Petitioners can easily make a fair argument the properties are presumptive historic resources under § 21084.1. The properties either are on a formal local register or were formally recognized by Resolution No. 82.111 as having historic significance. Petitioners believe this makes the motion (and presumably the case) open-and-shut, to the point that the Court need not even consider what the negative declaration or its supporting study says.
But as Friends of Willow Glen Trestle explains, the fair argument standard is incompatible with a statute that gives agencies the ability to find, by preponderance of the evidence, that a property is not a historic resource. Instead, the substantial evidence standard applies, so Petitioners must not only point to evidence in the record that supports their argument, but they must also show a lack of substantial evidence in the record supporting the City’s conclusion. It appears Petitioners do not even attempt to meet this burden, instead focusing solely on the inapplicable fair argument standard.
Even if Petitioners applied the right standard, the Court does not see how they would be entitled to injunctive relief on the present record. Based on the parties’ representations, the Court understands the administrative record in this matter will be quite large. In fact, the parties have yet to assemble the record. While Petitioners identify some evidence that might undercut the City’s conclusion (e.g., declarations from Catherine Jurca describing historic aspects of 1902 Ocean Way), this is a far cry from showing that based on the entire administrative record, it is reasonably likely no substantial evidence supports the City’s conclusion that the properties at issue are not historic resources. Indeed, the negative declaration itself, at page 125, contains statements and information that arguably serve as substantial evidence supporting the City’s conclusion--at least as to those properties designated “C Properties.”
For these reasons, the motion for a preliminary injunction is denied.