In Sacramentans for Fair Planning v. City of Sacramento, the Third District Court of Appeal recently upheld the City of Sacramento’s (“City”) approval of the “Yamanee” a mixed-use high rise in its bustling Midtown corridor. This decision establishes two important precedents for local policies to promote housing, by upholding 1) the City’s use of incentives to increase the allowable density to a project under a general plan, based on the project’s “community benefits”; and 2) streamlined environmental review under a Sustainable Communities Environmental Assessment (“SCEA”).

Increasing Density through “Significant Community Benefits”

Plaintiffs challenged Policy LU 1.1.10 in the City’s general plan, which allows projects to exceed the maximum density for a parcel, if the City finds that the project provides a “significant community benefit.” The Court of Appeal rejected Plaintiffs’ claims that the term “significant community benefit” is unconstitutionally vague.

Although Policy LU 1.1.10 does not specifically detail what constitutes a “significant community benefit,” the Court upheld the City’s findings that the project would provide a high level of design, contribute to the City’s housing goals, and provide additional environmental benefits as a high-density infill site. In upholding the City’s findings, the Court upheld a project that exceeds the floor area ratio by more than 300%, resulting in many more units per acre than would have otherwise been allowed under the general plan. This ruling, therefore, provides cities with a high degree of discretion to promote greater density and to approve projects that exceed the maximum density in a general plan, if reasonable findings can be made as to the community benefits of the project.

Expediting Environmental Review through Senate Bill (“SB”) 375 (2008)

SB 375 included provisions to relieve certain “transit priority projects” from some aspects of review under the California Environmental Quality Act (“CEQA”). Transit priority projects are developments that contain at least 50% residential uses, with a minimum density of twenty units per acre and located within a one-half mile of a major transit stop. Under SB 375, eligible projects need only prepare an SCEA or streamlined environmental impact report (“EIR”), rather than a full EIR. The SCEA may also refer to earlier completed EIRs for certain impacts. SB 375 also authorized cities to review projects under an SCEA if it is consistent with a “sustainable communities strategy” (“SCS”).

In this case, the City drew from the Sacramento Area Council of Governments’ (“SACOG”) transit plan/SCS. The Court rejected the argument that the City could not use SACOG’s SCS. The Court upheld the City’s reliance on the general plan EIR and SACOG’s SCS EIR in evaluating the Project’s cumulative impacts, and concluded that no further review of those cumulative effects was required in the SCEA.

Conclusion

After the ruling in Sacramentans for Fair Planning, cities have greater incentives to coordinate with regional transit agencies, COGs and MTOs, to seek expedited processing of projects through SB 375. Cities should also consider general plan policies that provide incentives for smart, compact development. By encouraging smart growth and reducing project processing costs and timelines, “community benefit” findings provide a new tool local governments can use to address climate change and the current housing crisis.

In a 2008 article published in Western City Magazine, SB 375 author, then-State Senator Darrell Steinberg, wrote that SB 375 maintains “local land use authority while at the same time creating incentives for cities and developers to build housing closer to job and retail centers.” Now, as Mayor of Sacramento, Steinberg will appreciate this decision upholding his 2008 law on his home turf.

If you have any questions about this case, please contact Robin Baral at robin@whitebrennerllp.com, Braeden Mansouri at braeden@chuchwellwhite.com, or Churchwell White LLP at (916) 468-0950.