RUVOLO, P. J. —
In this case, we address a discrete dispute arising out of the controversial "8 Washington Street Project," a plan to develop waterfront land near the San Francisco Ferry Building. The site for the project includes a parcel of property commonly referred to as "Seawall Lot 351," which is currently owned by the City and County of San Francisco through its Port Commission (the City), subject to the public trust for uses benefiting the people of California. The public trust restriction on the use of Seawall Lot 351 is inconsistent with the 8 Washington Street Project as conceived by the project developers, real parties in interest San Francisco Waterfront Partners II, LLC, and Pacific Waterfront Properties LLC (the Developers). To remove this inconsistency, the Developers and the City devised a plan to transfer Seawall Lot 351 out of the public trust and replace it with a different parcel of property pursuant to a land exchange agreement with the State Lands Commission (the SLC).
Defend Our Waterfront (respondent) brought this suit to challenge the SLC's reliance on a CEQA exemption which applies to "settlements of title and boundary problems by the State Lands Commission and to exchanges or leases in connection with those settlements." (§ 21080.11.) The trial court granted respondent's petition for a writ of mandate, finding that the proposed land exchange agreement is not statutorily exempt from CEQA review. The SLC, the City, and the Developers (collectively appellants) contend the judgment must be reversed because (1) respondent failed to exhaust its administrative remedies, and (2) the Seawall Lot 351 land exchange agreement is exempt from CEQA review. We affirm.
Seawall Lot 351 is an approximately 23,000-square-foot triangle-shaped parcel of land located near the corner of Washington Street and the Embarcadero, in close proximity to the San Francisco Ferry Building. Presently, Seawall Lot 351 is used as a surface parking lot serving the Ferry Building and surrounding facilities pursuant to a lease agreement between the City and the Ferry Building's management company. However, Seawall Lot 351 was once tide and submerged land under the San Francisco Bay. California acquired title to tide and submerged lands within its borders when it became a state in 1850. State ownership of these lands was "subject to the public trust" for commerce, navigation, fisheries and other recognized uses.
In the late 1870's, a new seawall was constructed on the waterside of an existing seawall originally built along the San Francisco waterfront, and the area between the two walls was filled. The filled land, which included Seawall Lot 351, retained the title of tide and submerged lands owned by the state in its sovereign capacity, subject to the public trust.
In 1968, the City acquired title to Seawall Lot 351 when the Legislature passed the Burton Act, pursuant to which it granted to the City sovereign lands within the City and County of San Francisco. (Stats. 1968, ch. 1333, p. 2544.) These granted lands remained subject to the public trust and were also subject to the terms of a statutory trust imposed by the Burton Act.
Today, Seawall Lot 351 is in an area covered by the Port of San Francisco Waterfront Land Use Plan (the WLUP), which the City adopted in order to "identify development opportunities that allow the Port to promote Trust uses while maximizing revenues from property no longer useful for Trust purposes through other compatible development." In the City's view, Seawall Lot 351 does not currently allow for development in furtherance of goals established by the WLUP because of its small size and irregular configuration.
The 8 Washington Street Project is a planned waterfront development consisting of up to 134 condominiums, 389 subsurface parking spaces, restaurants, retail establishments, and a tennis and swim club. The development site includes property commonly referred to as the "8 Washington Property," which is currently used as a privately owned swim and tennis club. The Developers of the 8 Washington Street Project hold an option to purchase the 8 Washington Property.
Seawall Lot 351 is immediately adjacent to the 8 Washington Property and is part of the development site for the 8 Washington Street Project. The Developers made a proposal to acquire Seawall Lot 351 from the City in exchange for a comparable section of the 8 Washington Property (the 8 Washington parcel), an upfront payment of $3 million, and future payments of a percentage of transfer fees that will be imposed on condominium unit sales within the development area. The proposal also requires the City to lease the 8 Washington parcel back to the Developers so that it can be improved as part of the overall 8 Washington Street Project.
To remove impediments to the development of the 8 Washington Street Project resulting from the public trust restriction on Seawall Lot 351, the City has proposed a "land exchange agreement" with the State of California pursuant to which the SLC would exercise its authority under chapter 310 of the Statutes of 1987 and the California Constitution to terminate public trust interests in Seawall Lot 351. The record does not disclose precisely when or how the land exchange plan originated. At least by October 2008, the Developers and the City were considering a "trust exchange." Three years later, in October 2011, the City met with the SLC about the proposal and submitted a draft land exchange agreement. A "final draft" of the proposed agreement (the draft agreement) is dated August 13, 2012.
The draft agreement reflects that the proposed exchange is part of a broader plan for the development of the 8 Washington Street Project. The agreement provides that, after the Developers transfer the 8 Washington parcel to the City, the following transactions will take place: (1) the City will convey Seawall Lot 351 and the 8 Washington parcel to the SLC; (2) the SLC will terminate the public trust interests in Seawall Lot 351 and then convey it back to the City free of the trust; (3) the SLC will impress the 8 Washington parcel with the public trust and convey it back to the City as trustee. The draft agreement also contemplates that after the land exchange is completed, the City will convey Seawall Lot 351 to the Developers pursuant to a
The land exchange agreement was scheduled for consideration at an August 14, 2012 meeting of the SLC. The agenda for the meeting was posted on the SLC Web site on August 1. The City's request for SLC approval of the Seawall Lot 351 land exchange agreement was calendared as "Regular Calendar [Item] 103" (Calendar Item 103) and was described as follows: "PORT OF SAN FRANCISCO, CALIFORNIA STATE LANDS COMMISSION (PARTIES): Consider a Land Exchange Agreement between the State of California, acting by and through the Commission, and the City and County of San Francisco, acting by and through the Port of San Francisco, involving certain parcels of land located within Seawall Lot 351 and the 8 Washington Street property, [C]ity of San Francisco, County of San Francisco. The result of the proposed Agreement would be to terminate any and all public trust and sovereign property rights in approximately .52 acres of filled tidelands and acquisition by the Port, as trustee, of approximately .54 acres of certain other lands."
On August 7, 2014, the SLC added a hyperlink to its August 14 meeting agenda which gave access to an SLC staff report recommending approval of the land exchange agreement. The staff report included a description of the proposed exchange agreement, background information about the 8 Washington Street Project, a summary of legal requirements for terminating the state's public trust interests in Seawall Lot 351, an analysis in support of the staff's approval recommendation, and a list of other "pertinent" information about the 8 Washington Street Project. The staff report also included a set of recommended findings, the first of which pertained to CEQA and stated: "Find that the activity is exempt from the requirements of CEQA pursuant to Title 14, California Code of Regulations, section 15061 as a statutorily exempt project pursuant to Public Resources Code Section 21080.11, settlement of title and boundary problems and to exchanges or leases in connection with those settlements."
A transcript of the August 14, 2012 SLC meeting reflects that when Calendar Item 103 was called, SLC Chief Counsel Jennifer Lucchesi presented a slide show presentation in support of the land exchange agreement. Lucchesi underscored that "it's important to note the Commission is not being asked to approve any proposed development projects involving this property, only a land exchange pursuant to a 1987 statute." Without making
On August 21, 2012, a "Notice of Exemption" was filed with the State Clearinghouse,
On September 25, 2012, respondent filed a petition for writ of mandate challenging the SLC decision to approve "an exchange of Seawall Lot 351 for non-trust parcels located at 8 Washington Street" without requiring CEQA review. According to the petition allegations, respondent is a nonprofit unincorporated public interest association of individuals and groups that was formed in September 2012, after the SLC approved the land exchange agreement. Respondent alleged that members of its association, "including the non-profit association Friends of Golden Gateway (FOGG), objected to the State Lands Commission's approval of the 8 Washington/Seawall Lot 351 land exchange agreement and exhausted administrative remedies."
Respondent further alleged that the SLC abused its discretion and failed to proceed in the manner required by law by approving the land exchange agreement that terminated the state's sovereign public trust interests in Seawall Lot 351 and exchanged that parcel for other property located at the 8 Washington Street Project site based on a claimed statutory exemption from CEQA for SLC "settlements of title and boundary problems." (§ 21080.11.) According to respondent, this statutory exemption does not apply as a matter of law "because there is neither a title or boundary dispute nor settlement of any such dispute relating to Seawall Lot 351 held in public trust. Instead, the purpose of the land exchange agreement is to promote the 8 Washington luxury condominium project."
On January 10, 2014, the trial court found that exhaustion of administrative remedies requirements imposed by CEQA do not apply in this case because there was no effective notice of a public hearing on a CEQA matter prior to the SLC ruling. (See § 21177, subd. (e).)
On January 17, the court granted the mandate petition, ruling that the section 21080.11 statutory exemption "is not applicable to the exchange agreement for seawall lot 351" and, "[a]ccordingly, the exchange agreement is not exempt from CEQA review." The court's findings included (1) the statutory language in section 21080.11 is clear and unambiguous; (2) in light of the clear statutory language, the agency action is not entitled to deference; (3) the exchange agreement is not a "settlement[] of title and boundary problems" by the SLC as required for section 21080.11 to apply; and (4) the legislative history of the statutory exemption does not compel a different conclusion.
Appellants contend the trial court should have dismissed the mandate petition without reaching its merits because respondent failed to comply with section 21177 of CEQA, which they characterize as a standing statute, but which is actually an exhaustion of administrative remedies statute. (Citizens for Open Government v. City of Lodi (2006) 144 Cal.App.4th 865, 875, fn. 8 [50 Cal.Rptr.3d 636] (City of Lodi); see Tomlinson v. County of Alameda (2012) 54 Cal.4th 281, 291 [142 Cal.Rptr.3d 539, 278 P.3d 803] (Tomlinson).) "We apply a de novo standard of review to the legal question of whether the doctrine of exhaustion of administrative remedies applies in a given case. [Citations.]" (City of Lodi, supra, 144 Cal.App.4th at p. 873.)
The exhaustion of administrative remedies rules for CEQA are codified in section 21177. For clarity's sake, we will refer to the following provisions of section 21177 by their subdivision designations:
Subdivision (b) requires that the petitioner must have objected to the project on some ground before the agency made its decision. (Woodward Park Homeowners Assn., Inc. v. City of Fresno (2007) 150 Cal.App.4th 683, 711 [58 Cal.Rptr.3d 102] ["petitioner itself need only have raised some objection before the agency [citation]; if it has, it may then litigate any issue raised before the agency by anyone" (italics omitted)].) Here, although respondent was formed after the SLC decided the matter, former San Francisco City Attorney Louise Renne appeared at the August 14 meeting and opposed the project on behalf of Friends of Golden Gateway (FOGG), a group that subsequently became a member of respondent.
Subdivision (c) also potentially applies in this case because respondent was formed after the SLC issued its decision. To satisfy subdivision (c), respondent was required to comply with both subdivisions (a) and (b). Appellants concede that Louise Renne's objection to the project satisfied subdivision (b), but they interpret subdivision (c) as modifying the statutory language in subdivision (a) in cases involving after-formed organizations. According to appellants, such a party cannot rely on another party's CEQA objection, but must establish that one of its own members raised the precise issue that it wants to raise in court. Thus, appellants contend that the mandate petition should have been dismissed because the Ferry Building management company that raised the CEQA objection at the August 14 meeting is not a member of respondent's organization.
We disagree with appellants' contention because the only notice provided by the agenda for the August 14 SLC meeting was that the SLC was considering a land exchange agreement proposed by the City. The agenda did not notify anyone that the SLC would also consider invoking a statutory
Appellants argue that even if the Web site posting of the SLC meeting agenda was insufficient notice, the public received adequate notice of the SLC's intention to invoke a CEQA exemption because the SLC staff report was also available on the Internet. However, the SLC staff report did not provide legally sufficient public notice of the SLC's CEQA decision for two reasons. First, the report was made available for public review via a hyperlink that was posted on the SLC's meeting agenda, which did not disclose that the SLC staff recommended consideration of a CEQA exemption. Thus, someone would have to take the additional steps of accessing and reviewing the report in order to learn that a CEQA issue would be decided at the August 14 SLC meeting. Second, and in any event, the hyperlink to the staff report was not added to the meeting agenda until August 7, and thus the report itself could not have provided the 10-days' notice required by Government Code section 11125, subdivision (a).
Alternatively, appellants argue that subdivision (e) of section 21177 does not exempt respondent from the subdivision (a) exhaustion requirement because respondent had actual notice that the SLC was going to consider a CEQA exemption at the August 14 meeting. To support this contention, appellants rely on an August 13, 2012 letter that Louise Renne sent to the SLC in which she opposed the land exchange agreement both as a citizen of San Francisco and on behalf of FOGG. In that letter, Renne objected that "[t]he proposed land exchange would violate the common-law and constitutional public-trust doctrines in several respects," but she did not raise a CEQA objection to the project. Appellants contend that this letter proves that Renne had actual notice that the SLC was going to make a CEQA ruling because it contains several references to the SLC staff report for Calendar Item 103.
Finally, appellants contend that respondent waived any inadequacy in the notice of the SLC's August 14 meeting because Louise Renne appeared at the meeting and could have raised a CEQA objection at that time. This waiver theory misses the mark because the pertinent question is whether the SLC provided the required 10-days' notice to the public of its intention to make a CEQA decision at the August 14 meeting. Providing that notice at the meeting where the decision was made obviously did not satisfy the 10-day requirement.
For similar reasons, appellants mistakenly rely on Temecula Band of Luiseño Mission Indians v. Rancho Cal. Water Dist. (1996) 43 Cal.App.4th 425 [50 Cal.Rptr.2d 769] (Temecula). The issue in that case was whether an agency's notice of intent to issue a negative declaration under CEQA contained an incomplete and therefore inaccurate description of the project. (43 Cal.App.4th at pp. 433-434.) The Temecula court found this issue was waived because, when the project was correctly described at the public hearing appellant did not object that the project description in the notice was inaccurate. (Id. at p. 434.) Temecula does not alter our conclusions here because there was no question that the appellant in that case had prior legally adequate notice of the agency's intention to make a CEQA decision. (43 Cal.App.4th at p. 431.)
Furthermore, in Temecula, supra, 43 Cal.App.4th at page 434, the court distinguished the principal case relied on by the objector — McQueen v. Board of Directors (1988) 202 Cal.App.3d 1136 [249 Cal.Rptr. 439] (McQueen), disapproved on another ground in Western States Petroleum Assn. v. Superior Court (1995) 9 Cal.4th 559 [38 Cal.Rptr.2d 139, 888 P.2d 1268]. In McQueen, the issue was whether a regional district's plan to acquire property contaminated with PCB was exempt from CEQA review. The McQueen court rejected the district's claim that the CEQA petitioner failed to exhaust his administrative remedies, finding that the project description in the district's notice of intent to invoke a CEQA exemption was so inaccurate and misleading that it was tantamount to a lack of notice. (McQueen, at p. 1150.) Furthermore, the court found that, "[c]onsidering the manner in which the district's proposed plans ... were publicized," the CEQA petitioner "adequately raised the objections available at the time." (McQueen, at p. 1151.)
To the extent Temecula and McQueen support appellants' theory that the waiver doctrine can excuse an agency's failure to comply with the section
For all these reasons, we affirm the trial court's finding that respondent's mandate petition did not violate the exhaustion of remedies doctrine.
In the present case, appellants implicitly concede that the land exchange agreement constitutes a CEQA project. In fact, during the administrative process, the SLC and the City proceeded to the second step of CEQA by
Typically, courts resolve substantive CEQA issues by determining independently whether the administrative record demonstrates any legal error by the agency and whether it contains substantial evidence to support the agency's factual determinations. (North Coast Rivers Alliance v. Westlands Water Dist. (2014) 227 Cal.App.4th 832, 850 [174 Cal.Rptr.3d 229].) Thus, an "agency's finding that a statutory exemption applies to a project will be upheld if substantial evidence supports the finding of exemption. [Citation.]" (Ibid.) "On the other hand, if we are required to construe the scope of a statutory exemption, to that extent the issue becomes one of statutory interpretation to which we apply de novo review. [Citations.]" (Id. at p. 851.)
In the present case, the SLC found that the land exchange agreement is statutorily exempt from CEQA review under section 21080.11, which states: "This division shall not apply to settlements of title and boundary problems by the State Lands Commission and to exchanges or leases in connection with those settlements." As noted above, the record on appeal is silent as to how the SLC determined that the land exchange agreement falls within the scope of this exemption. In this court, appellants contend that the plain language of the exemption applies because the land exchange agreement settles a title problem by removing the public trust restrictions preventing development of Seawall Lot 351. Respondent, on the other hand, argues that the plain language of the exemption precludes its application here because the land exchange agreement is not connected to the settlement of a boundary or title dispute.
Second, although we have not found a case applying section 21080.11, at least one court has recognized that the purpose of this CEQA exemption is to promote the state's legitimate interest in settling land disputes. (Burke v. California Coastal Com. (2008) 168 Cal.App.4th 1098 [85 Cal.Rptr.3d 909] (Burke).) In Burke, a homeowner filed a writ petition challenging the California Coastal Commission's jurisdiction to prevent him from rebuilding a fence separating his property from a sandy beach public easement. The Burke court found that the fence was exempted from the Coastal Commission's jurisdiction under section 30416, subdivision (c), a provision of the California Coastal Act of 1976 (§ 30000 et seq.), which states: "Boundary settlements between the State Lands Commission and other parties and any
Appellants argue that limiting the section 21080.11 exemption to "situations involving settlement of a title or boundary `dispute' or `defect'" would constitute an impermissible rewriting of the statute. They contend that the language as written broadly applies to settlements of title or boundary "problems," which easily include "a difficult or perplexing situation regarding title or boundaries, such as the unsuitability of Seawall Lot 351 for Burton Act trust and public trust uses." However, in our view, it is appellants who attempt to rewrite the clear meaning of the exemption language by assigning an overbroad, ill-conceived meaning to the word "problems," and by disregarding material language in the statute that explicitly limits the scope of the exemption to "settlements." (§ 21080.11.)
Appellants forcefully argue that the Supreme Court has long recognized that the SLC has authority to approve land exchange agreements even in
Appellants next claim that the "arbitrary and capricious" standard governing judicial review of an agency decision precludes a court from substituting "its own judgment about what constitutes a `title and boundary problem' for that of the Commission — the Legislature's delegee of the power to make this very determination." As support for this argument, appellants mistakenly rely on County of Orange v. Heim (1973) 30 Cal.App.3d 694 [106 Cal.Rptr. 825] (Heim). First, we observe that appellants neglect to mention that the Heim court invalidated a land exchange agreement between a county and a private property owner which called for the dredging and filling of tidal land notwithstanding the fact that the SLC had approved it. (Id. at p. 707.) Furthermore, the land exchange agreement that was reviewed in Heim did not raise any issue under CEQA because the SLC approved that agreement before CEQA was enacted. (30 Cal.App.3d at p. 714.) Interestingly, though, the Heim court stated that "[w]e have no doubt that today approval of the land exchange agreement would have to be preceded by an environmental impact study and report pursuant to [CEQA]. [Citation.]" (Ibid.)
Without acknowledging the important distinctions between this case and Heim, supra, 30 Cal.App.3d 694, appellants insist that Heim undermines the judgment here because that case affirms the principle that, when "exercising the limited scope of judicial review of the quasilegislative actions of administrative agencies, a court may not reweigh the evidence and substitute its judgment for that of the agency nor may it inquire into the soundness of the reasoning by which the agency's conclusions were reached. [Citations.]" (Id. at p. 721.) However, the Heim court applied this deferential standard to its review of the SLC's exercise of its delegated authority to administer tideland grants. Here, by contrast, the action we review was not an exercise of the SLC's delegated authority over tide and filled lands subject to the public trust. As discussed above, this court offers no opinion as to whether the SLC can or should approve the Seawall Lot 351 land exchange agreement. The sole question we answer is whether that proposed agreement is statutorily exempt from CEQA review. Construing the scope of this CEQA exemption is
Finally, both sides rely on an environmental impact report (EIR) that has allegedly already been prepared for the 8 Washington Street Project. Appellants argue that EIR covers this land exchange agreement and that "[n]o interest would be served" by requiring a separate CEQA review in this case. Respondent attempts to counter this argument by filing a request for judicial notice of a recent court decision which allegedly evaluates the adequacy of the EIR for the 8 Washington Street Project. We reject appellants' argument and also deny respondent's request for judicial notice as irrelevant to our disposition of this appeal. (Golden Gate Land Holdings LLC v. East Bay Regional Park Dist. (2013) 215 Cal.App.4th 353, 366 [155 Cal.Rptr.3d 546] ["Only relevant evidence is admissible by judicial notice."].) In deciding that the proposed Seawall Lot 351 land exchange agreement between the City and the SLC is not exempt from CEQA review, we need not, and do not, address any question about the adequacy of the EIR prepared for the 8 Washington Street Project.
For the reasons stated we conclude that the land exchange agreement was not exempt from CEQA review.
The judgment is affirmed. Costs on appeal are awarded to respondent.
Reardon, J., and Rivera, J., concurred.
The 2010 amendment to subdivision (c), which added language explicitly requiring after-formed organizations to comply with subdivision (a), as well as with subdivision (b), will remain in effect at least until 2016. (Subd. (f) ["This section shall remain in effect only until January 1, 2016, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2016, deletes or extends that date."].)
