GALANTE VINEYARDS v. MONTEREY PENINSULA WATER MANAGEMENT DISTRICT (1997)

Monterey Peninsula Water Management District (District) appeals from a judgment granting a peremptory writ of mandate ordering District to set aside its certification of a final environmental impact report (EIR) and approval of the New Los Padres Dam and Reservoir project.   District also challenges the award of attorney's fees pursuant to Code of Civil Procedure section 1021.5.   California-American Water Company (Cal-Am) ¹ has filed an amicus curiae brief in support of District's appeal.   For the reasons stated below we affirm the judgment.

FACTUAL AND PROCEDURAL BACKGROUND

In response to a period of severe drought, the District was formed in 1978 for the purpose of conserving and augmenting the water supply and to protect the environmental quality of the Monterey Peninsula.   The District boundaries encompass a 170-square mile area consisting of the cities of Carmel-by-the-Sea, Del Rey Oaks, Monterey, Pacific Grove, Sand City, Seaside, and portions of Marina, Fort Ord, and Monterey County.

Following its formation, the District explored a variety of long-term water supply alternatives.   Pursuant to the California Environmental Quality Act (CEQA) (Pub. Resources Code, § 21000 et seq.),² in 1982, the District issued a notice of preparation of an EIR for a 29,000 acre-foot New San Clemente Dam and Reservoir on the Carmel River.   After completion of a draft EIR/EIS ³ and public review of the New San Clemente Dam project, it was determined that a New Los Padres Dam and Reservoir project would be a less environmentally damaging feasible alternative.

In January 1988, District decided to prepare a supplemental draft EIR/EIS for the 24,000 acre-foot New Los Padres Dam and Reservoir.   In August 1991, the supplemental draft EIR/EIS was published.   The public comment period for oral and written comments on the New Los Padres supplemental draft EIR/EIS was from August through October 1991, during which time the District accepted written comments, conducted public workshops and held two public hearings.

In written comments on the 1991 supplemental draft EIR/EIS, state and federal resource agencies requested that the District explore additional alternatives.   In response, the District decided to prepare a second supplemental draft EIR/EIS.

The second supplemental draft EIR/EIS analyzed five alternatives, including a New Los Padres Dam and Reservoir and a New Los Padres Dam and Reservoir combined with a desalination plant.   The report identified New Los Padres Dam and Reservoir combined with the desalination plant as the District's preferred alternative, provided the desalination project received voter approval.⁴

The second supplemental draft EIR/EIS was released for public review in February 1993.   The public comment period, during which time written comments were received, workshops conducted and public hearings held, lasted through the month of April 1993.

Following the comment period for the second supplemental draft EIR/EIS, the District prepared the final EIR, which evaluated the New Los Padres Dam and Reservoir project as the environmentally preferable alternative.

In December 1993, the U.S. Army Corps published a public notice requesting comment on the District's Clean Water Act section 404 permit application.   Comments were received from December 3,1993, through May 16, 1994.

District published the final EIR/EIS in March of 1994.   Four public workshops and a public hearing to receive oral and written comments on the final EIR/EIS took place on April 20, 25, and 28, 1994, respectively.   May 2, 1994, was the final date for submitting written comments on the final report.

One of the individuals who submitted written comments was Charity Crane.   Among other concerns, Crane criticized the report's description of the Cachagua Valley as “sparsely populated” with “no industry other than several vineyards.”   Crane stated that the “Cachagua and the Tassajara areas have numerous vineyards and small world class, highly regarded winer[ies].   This industry is thriving and the area has achieved recognition world wide for its quality wines.”   Crane then complained “air pollution from dust ․ affect[s] the production and maturation of wine grapes and will result in significant damage to this industry in the area.   The loss of two year[']s grape harvest or an inferior harvest will be a significant negative economic effect on the area which has not been addressed in the EIR.” The Esselen Tribe of Monterey also submitted comments on the EIR, and both Crane and the Esselen Tribe representative appeared at the public hearing held April 28, 1994.

In an undated letter to the U.S. Army Corps, the production manager of Bernardus Winery expressed his concern about potential local impacts of the new dam project.   These included the creation of dust which would obstruct sunlight and coat vine leaves, the potential change of frost patterns due to the creation of a new body of water in Cachagua, and increased traffic that dam construction would create.   The letter was received by the District on May 26, 1994.

Jack Galante, General Manager of Galante Vineyards and a professional environmental planner, wrote to the District on August 3, 1994.   The eight-page letter detailed the concerns he and other viticulturists in Cachagua had with the final EIR/EIS and its lack of discussion on the project's impact to local agriculture.   In response, the District stated that the comment period for the final EIR/EIS had ended on May 2, 1994, and, accordingly, the District would not respond to Galante's (or Bernardus Winery's) concerns as part of the formal environmental process.⁵

On September 19, 1994, the District's Board of Directors conducted a public hearing at which various members of the public voiced their opposition to the New Padres Dam and Reservoir project.   Included among the speakers were three members of petitioner Citizens for Alternative Water Solutions (CAWS) who claimed the final EIR was inadequate in that it failed to study the project's effect on viticulture or agriculture and Chapter 14 of the EIR was not prepared by a person knowledgeable in Native American cultural resources.   Nevertheless, the Board passed Resolution No. 94-12, which adopted findings to certify that the March 1994 New Los Padres final EIR complied with CEQA. The Board also voted to receive an addendum to the final EIR and to accept it as part of the final EIR/EIS.

On October 18, 1994, Galante Vineyards, Rancho Galante, Bernardus and Durney Vineyards filed a petition for writ of mandate directing the District to set aside its certification of the EIR and its ratification of the New Los Padres Dam and Reservoir as the preferred water supply project for the District.   A first amended petition, adding CAWS and the Esselen Tribe of Monterey County as petitioners, was filed on January 30, 1995.

On May 15, 1995, the District's Board received a second addendum to the final EIR. The second addendum was released for public review and a “voluntary” comment period on May 16, 1995.   The second addendum was certified in August 1995.   Due to the date it was certified, the parties agreed that the adequacy of the second addendum for the purpose of approving the certification of the final EIR was not before the court.   Nevertheless, the court judicially noticed the addendum.

After filing an extensive intended decision, the trial court issued a peremptory writ of mandate ordering District to set aside and void its certification of the final EIR and approval of the New Los Padres Dam and Reservoir project, and to prepare a focused supplemental EIR on viticultural issues prior to further consideration of permit approval.   This appeal followed.

DISCUSSION

I**

II

Exhaustion of Administrative Remedy

 District contends all petitioners, with the exception of the Esselen Tribe, are precluded from bringing this action by virtue of the fact that they failed to participate in the public comment period for the second supplemental draft EIR.   At issue is the interpretation of section 21177 as amended in 1993.   District argues section 21177 does not allow belated challenges to a final EIR, the second addendum was the appropriate response to comments presented after close of the draft EIR comment period, and the petitioners who failed to raise objections to the second supplemental draft EIR should be dismissed for failure to exhaust their administrative remedy.   Implicit in its argument is the assumption that because the public comment period for the final EIR was optional pursuant to CEQA Guidelines, section 15089, subdivision (b),⁶ the District was not required to address concerns raised during or after that period.

Section 21177, as amended in 1993, provides in relevant part as follows:

“(a) No action or proceeding may be brought pursuant to Section 21167 unless the alleged grounds for noncompliance with this division were presented to the public agency orally or in writing by any person during the public comment period provided by this division or prior to the close of the public hearing on the project before the issuance of the notice of determination.

“(b) No person shall maintain an action or proceeding unless that person objected to the approval of the project orally or in writing during the public comment period provided by this division or prior to the close of the public hearing on the project before the issuance of the notice of determination.

“(c) This section does not preclude any organization formed after the approval of a project from maintaining an action pursuant to Section 21167 if a member of that organization has complied with subdivision (b).”  (Emphasis in original.)

Legal commentators have construed subdivision (a) of the statute as requiring that specific issues raised in litigation must first be raised during the administrative process, albeit not necessarily by the person who brings the litigation.  (See, e.g., Remy, Guide to the California Environmental Quality Act (CEQA) (9th ed.1996), p. 378.)   Subdivision (b) of the statute restricts the availability of judicial review to parties who objected to the agency's approval of the project.   That is, a petitioner need not have articulated every basis for objecting to the project, but must have participated in the administrative process.  (Ibid.) Thus, a petitioner who has taken part in the administrative process may assert any issues raised by other parties during the administrative proceedings.  (Kings County Farm Bureau v. City of Hanford (1990) 221 Cal.App.3d 692, 734, fn. 13, 270 Cal.Rptr. 650;  Resource Defense Fund v. Local Agency Formation Com. (1987) 191 Cal.App.3d 886, 894, 236 Cal.Rptr. 794.)

Subdivision (c) permits an organization formed after approval of the project to seek judicial review as long as a member of the organization objected prior to project approval.  (Garrison v. Board of Directors (1995) 36 Cal.App.4th 1670, 1677, 43 Cal.Rptr.2d 214.)

The obvious problem in section 21177 is the use of the disjunctive in subdivisions (a) and (b);  i.e., objections must be raised by persons “during the public comment period provided by this division or prior to the close of the public hearing on the project before the issuance of the notice of determination.”   In discussing the statute in its intended decision the trial court stated:  “The statute should be interpreted to permit an action to be brought by any person who has objected up to or at the public hearing for issuance of the notice of determination, but only based on grounds for noncompliance for which the issue or factual support was raised prior to the close of the public hearing relating to the end of the comment period.”  (Emphasis in original.)   The decision assumes, without so stating, that the “public comment period provided by this division” was the comment period for the final EIR, since the decision refers to the written comments by Charity Crane during the public comment period on the final EIR. The court's interpretation extends the comment period through the certification hearing for a person, but limits the comment period for raising objections to mandatory or optional public comment periods.   The District correctly argues there is no satisfactory justification for interpreting the language one way as applied to the grounds for objecting and a different way when applied to the person objecting.

Nevertheless, we are unpersuaded by District's contention that the phrase “prior to the close of the public hearing on the project before the issuance of the notice of determination” as used in section 21177 must be interpreted as referring to a public hearing held during the public comment period for draft EIRs. We are mindful that section 21003.1 mandates that “[c]omments from the public ․ shall be made to lead agencies as soon as possible in the review of environmental documents ․ to allow the lead agencies to identify, at the earliest possible time in the environmental review process, potential significant effects of a project, alternatives, and mitigation measures which would substantially reduce the effects.”   We are also aware that the practice of allowing objectors to withhold objections, which could have been raised earlier in the environmental review process, until the last possible moment must be strongly disapproved.  (See Citizens of Goleta Valley v. Board of Supervisors (1990) 52 Cal.3d 553, 568, 276 Cal.Rptr. 410, 801 P.2d 1161.)

However, the term “notice of determination” refers to a brief notice that must be filed with the Office of Public Planning and Research and the county clerk of each county in which the project will be located whenever an agency determines to carry out a project.  (See §§ 21108, subd. (a);  21152, subd. (a);  Guidelines § 15373.)   The notice of determination must include among other things a “statement that an EIR was prepared and certified pursuant to the provisions of CEQA.” (Guidelines, § 15094, subd. (a)(5).)  “The filing of the Notice of Determination and the posting on a list of such notice starts a 30-day statute of limitations on court challenges to the approval under CEQA.” (Guidelines, § 15094, subd. (d).)  District's construction of the statute not only ignores the second alternative of the statute, but renders the phrase “during the public comment period provided by this division,” which includes optional comment periods, meaningless.

We think the problem was best described in 2 Kostka and Zischke, Practice Under the California Environmental Quality Act (Cont.Ed.Bar 1996) section 23.97, page 1013.   The authors first observe that no court has held that delaying submission of comments until after the conclusion of the public comment period constitutes a failure to exhaust administrative remedies.   They then state:  “By amending the statute to indicate that the grounds for noncompliance must be asserted during the public comment period or before the close of the public hearing on the project, the legislature has probably made it more difficult to characterize a failure to raise CEQA defects during the comment period as a waiver or failure to exhaust.   Indeed, the amendments to the statute could be interpreted to allow project opponents to delay raising any criticisms until the final hearing on the project.   In the authors' view, at least with respect to draft EIRs, this interpretation would conflict with the statutory scheme calling for criticisms to be raised in comments on the draft EIR so that the agency is given an adequate opportunity to respond in the final EIR.”

The authors conclude that the failure to participate in the public comment period for a draft EIR should be treated as a waiver of any claims relating to the objection, unless the objection concerns the adequacy of the final EIR's response to comments, or the objection could not have been made during the comment period.   While the authors' conclusion may have procedural merit, it sheds no light on what the Legislature meant by the phrase “close of the public hearing on the project before the issuance of the notice of determination.”   Clearly, there is no issuance of the notice of determination immediately following the public comment period for draft EIRs.

 “The Legislature is presumed to have meant what it said, and the plain meaning of the language will govern the interpretation of the statute.”  (In re Khalid H. (1992) 6 Cal.App.4th 733, 736, 8 Cal.Rptr.2d 414;  see also, Craig v. City of Poway (1994) 28 Cal.App.4th 319, 337, 33 Cal.Rptr.2d 528.)   Accordingly, this court is without authority to disregard a portion of the language of section 21177.  (William Dal Porto & Sons, Inc. v. Agricultural Labor Relations Bd. (1987) 191 Cal.App.3d 1195, 1204, 237 Cal.Rptr. 206.)   As we read section 21177, any alleged grounds for noncompliance with CEQA provisions may be raised by any person prior to the close of the public hearing on the project before the issuance of the notice of determination.

Any challenge to this interpretation should be addressed to the Legislature.   If the time for exhausting administrative remedies is to be limited to the “public comment period provided by this division,” the Legislature also should clarify whether this includes voluntary comment periods for final EIRs.

Based on our reading of section 21177, we conclude that any party may bring a action pursuant to section 21167 if it has raised an objection to the adequacy of an EIR prior to certification.   According, we find all petitioners have exhausted their administrative remedies in that each raised concerns about the inadequacy of the final EIR prior to certification.

III-V ***

DISPOSITION

The judgment is affirmed.

FOOTNOTES

1.   Cal-Am is the utility company responsible for supplying water to District residents.   On July 6, 1995, the State Water Resources Control Board (SWRCB) issued Order No. WR 95-10 which reduced Cal-Am's right to divert water from the Carmel River and ordered Cal-Am to immediately identify alternative water supply sources.   In a November 7, 1995 public vote, the District's constituents failed to approve the District's financing plan to the New Los Padres Dam and Reservoir project.   Thereafter, Cal-Am announced that it would privately finance construction of the dam under a different name, the Carmel River Dam. Accordingly, Cal-Am now has a direct interest in the outcome of this action.

2.   All further statutory references are to the Public Resources Code unless otherwise indicated.

3.   Before the EIR was complete, the U.S. Army Corps of Engineers informed the District that a federal Clean Water Act section 404 permit for the project was required.   To obtain the 404 permit, the District needed to prepare a federal Environmental Impact Statement (EIS) pursuant to the National Environmental Protection Act (NEPA).

4.   In June 1993, voters within the District boundaries failed to authorize financing or construction of the desalination facility.

5.   The District indicated that it would be interested in an informal meeting with Galante and other Cachagua vineyard owners to better understand their concerns, clarify perceptions about the proposed dam, and discuss means to reduce potential adverse effects during project construction.

FOOTNOTE.   See footnote *, ante.

6.   Guidelines section 15089, subdivision (b) states in relevant part:  “Lead Agencies may provide an opportunity for review of the final EIR by the public or by commenting agencies before approving the project.”  (Emphasis added.)All references to “Guidelines” are to the CEQA Guidelines, which implement the provisions of CEQA. (Cal.Code Regs., tit. 14, § 15000 et seq.)   The Guidelines state, “These Guidelines are binding on all public agencies in California.”  (Guidelines § 15000.)   There is a conflict of authority on whether the Guidelines are regulatory mandates or only aids to interpreting CEQA. (See Laurel Heights I, supra, 47 Cal.3d at p. 391, fn. 2, 253 Cal.Rptr. 426, 764 P.2d 278.)

FOOTNOTE.   See footnote *, ante.

MIHARA, Associate Justice.

COTTLE, P.J., and BAMATTRE-MANOUKIAN, J., concur.