Crenshaw Subway Coalition v. City of L.A. ( 2022 )

Filed 3/3/22
CERTIFIED FOR PARTIAL PUBLICATION*
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION TWO
CRENSHAW SUBWAY B309288
COALITION,
(Los Angeles County
Plaintiff and Appellant, Super. Ct. No. BS174553)
v.
CITY OF LOS ANGELES et al.,
Defendants and
Respondents;
HAAS BHCP PROPERTY
OWNER, LLC,
Real Party in Interest
and Respondent.
* This opinion is published as to all parts except Part II of
the Discussion.
APPEAL from a judgment of the Superior Court of Los
Angeles County, Mitchell L. Beckloff, Judge. Affirmed.
Strumwasser & Woocher, Beverly Grossman Palmer,
Caroline Chiappetti, and Salvador E. Perez for Plaintiff and
Appellant.
Michael N. Feuer, City Attorney, Terry Kaufmann-Macias,
Assistant City Attorney, John W. Fox, Craig Takenaka, Mei-Mei
Cheng, Elaine Zhong, Deputy City Attorneys; Burke, Williams &
Sorensen, Charles E. Slyngstad, Nicholas J. Muscolino; Thomas
Law Group and Amy Higuera for Defendants and Respondents.
Alston & Bird and Edward J. Casey for Real Party in
Interest and Respondent.
******
After the City of Los Angeles (the City) approved a project
aimed at “revitaliz[ing]” a neighborhood in South Los Angeles
through the renovation and expansion of an existing shopping
mall and the construction of additional office space, a hotel, and
new apartments and condominiums, a neighborhood advocacy
group sued to enjoin the project under the federal Fair Housing
Act (42 U.S.C. § 3601 et seq.) and California’s Fair Employment
and Housing Act (FEHA) (Gov. Code, § 12900 et seq.). The
group’s lawsuit rests on a “gentrification” theory—namely, that
the project will lead to an “influx of new, more affluent residents”;
that this influx will lead to “increased rents and increased
property values that [will] put pressure” on the low-income
residents who currently live near the project site; and that these
2
higher rents will push the low-income residents out of “their
neighborhoods.” Because a majority of these low-income
residents are Black or Latinx, the group alleges, the project has
the effect of “mak[ing]” “dwellings” “unavailable” “because of
race[ and] color” in violation of the disparate impact prong of the
Fair Housing Act (and, thus, by extension, the FEHA).
Is a disparate impact claim based on this gentrification
theory cognizable under the Fair Housing Act? We conclude it is
not, and this conclusion is dictated by the United States Supreme
Court’s decision in Texas Department of Housing & Community
Affairs v. Inclusive Communities Project, Inc. (2015) 576 U.S. 519(Inclusive Communities). In no uncertain terms, Inclusive
Communities held that the Fair Housing Act does not afford relief
if such relief “cause[s] race to be used and considered in a
pervasive and explicit manner [in deciding whether] to justify
governmental or private actions” because doing so “inject[s] racial
considerations into [the] decision.” (Id. at p. 543.) Because the
Fair Housing Act itself was enacted to combat (and hence only
prohibits) those policies and practices that “ha[ve] a ‘significantly
disparate impact on nonwhites’” (Hardie v. NCAA (9th Cir. 2017)
876 F.3d 312, 319 (Hardie), quoting Wards Cove Packing Co. v.
Atonio (1989) 490 U.S. 642, 658 (Wards Cove), italics added), the
gentrification theory would be available—if at all—only when the
low-income residents who are displaced by revitalization efforts
are minorities. Thus, recognizing the group’s gentrification
theory would obligate the City to “use[] and consider[]” race in
making local planning decisions, and thus the group’s
gentrification theory is not cognizable under the Fair Housing
Act (and, by extension, the FEHA).
3
For this reason and others, we affirm the dismissal of the
group’s gentrification-based claims under the Fair Housing Act
and FEHA. In the unpublished portion of our opinion, we also
affirm the dismissal of the group’s claim under the California
Environmental Quality Act (CEQA) (Pub. Resources Code, §
21000 et seq.) as untimely.
FACTS AND PROCEDURAL BACKGROUND
I. Facts1
A. The Project
In South Los Angeles, there is a 43-acre parcel of property,
shaped somewhat like a shark’s dorsal fin, that is bounded on the
north by 39th Street, on the east by Crenshaw Boulevard, on the
south by Stocker Street, and on the west by Santa Rosalia Drive
and Marlton Avenue; Martin Luther King Jr. Boulevard runs
east-west through the center of the parcel. The parcel is
currently home to the Baldwin Hills Crenshaw Plaza, which
features an enclosed mall, a movie theatre, a few commercial
establishments, a small amount of office space, and surface
parking lots and parking structures; the parcel contains no
residential dwellings. The Crenshaw/LAX light rail line, which
currently is under construction, will eventually run through the
parcel.
Beginning in 2008 and after various proposals, three
private entities—Capri Urban Baldwin, LLC; Capri Urban
Crenshaw, LLC; and Capri Urban Rosalia, LLC (collectively, the
1 These facts are drawn from the operative third amended
complaint as well as documents judicially noticed by the trial
court.
4
developer)2—applied to the City to redevelop the parcel by
leaving most of the mall and theatre intact, but demolishing a
portion of the mall and the office space and constructing a
“mixed-use” facility with a net floor area exceeding 3 million
square feet (the Project). At the end of the 20-year lifespan of the
Project’s construction, the Project would have 331,838 square feet
of retail and restaurant space; 143,377 square feet of office space;
a new, 400-room hotel; and 961 new residential units, comprised
of 551 condominiums for purchase and 410 apartments for rent.
Ultimately, the developer agreed to set aside 10 percent of each
type of the residences for affordable housing—specifically, 5
percent of the condominiums would be available only to persons
earning less than 50 percent of the area median income and
another 5 percent would be available for members of the
workforce earning at most 150 percent of the area median
income; and 5 percent of the apartments would be available to
persons earning less than 60 percent of the area median income
and another 5 percent would be available to persons earning less
than 80 percent of the area median income. The developer also
agreed to hire 25 percent of the workforce used to build and
operate the Project from the local community.
B. The surrounding neighborhood
The Project is “near” the Leimert Park neighborhood and
within the “Crenshaw Corridor.” Together, these areas have
“served as the political, cultural, and commercial heart of Black
Los Angeles” since the 1960’s, and are one of the “last majority
Black communities in the City of Los Angeles.” Census data
indicates that in Leimert Park, 65 percent of the residents are
2 The parcel was subsequently purchased by HAAS BHCP
Property Owner, LLC, which is now the developer.
5
Black and 25 percent of the residents are Latinx, and in the
Crenshaw Corridor, 43 percent of the residents are Black and 47
percent of the residents are Latinx.
C. Administrative proceedings
1. Department of City Planning
The Los Angeles City Council has designated the
Department of City Planning (the Department) as its “Advisory
Agency” to approve vesting tentative tract maps for anticipated
land use projects. (L.A. Mun. Code, §§ 17.03.A., 17.06.) Once
approved, a vesting tentative tract establishes “certain rights to
proceed with development.” (Id., § 17.02.)
On December 21, 2016, the Department held a noticed
hearing to decide, among other things, whether (1) to approve the
vesting tentative tract map for the Project, and (2) to certify the
final environmental impact report that had been prepared for the
Project.
On January 18, 2017, the Department issued a letter of
determination that (1) approved the vesting tentative tract map,
and (2) certified the final environmental impact report.
The Department did not issue a notice of determination
until March 20, 2017, which was 61 days after the issuance of its
letter of determination.
2. City Planning Commission
In July 2017, the City Planning Commission held a hearing
to consider several other issues necessary to enable the Project to
move forward—chiefly, whether to recommend that the City
Council change the zoning and height district designation of the
Project’s parcel.
On August 3, 2017, the City Planning Commission issued a
letter stating its finding that no further environmental impact
6
analysis was required, and recommending that the City Council
adopt the proposed changes to the zoning and height district
designation.
3. Planning and Land Use Management (PLUM)
Subcommittee
At the behest of several groups who appealed the City
Planning Commission’s determination, the City Council’s PLUM
Subcommittee held a hearing in early June 2018. The PLUM
Subcommittee subsequently issued a report recommending denial
of the appeals, concluding that no further environmental impact
analysis was required, and recommending that the City Council
adopt the proposed changes to the zoning and height district
designation.
4. City Council
At its June 27, 2018 meeting, the City Council unanimously
voted to adopt the PLUM Subcommittee’s recommendations,
thereby denying the appeals, concluding that no further
environmental impact analysis was required, and enacting the
ordinances necessary to change the zoning and height district
designation of the Project’s parcel.
II. Procedural Background
A. Operative pleading
On July 30, 2018, the Crenshaw Subway Coalition (the
Coalition) sued the City of Los Angeles and the City Council
(collectively, the City), as well as the developer, to enjoin the
Project. The Coalition is a “nonprofit organization of residents,
property owners and merchants in the South Los Angeles
community” who are “firmly opposed” to “gentrification” that
would “displace long-standing Black and Latinx residents.” In
7
the operative pleading, the Coalition alleges that the Project
violates (1) the Fair Housing Act, (2) FEHA, and (3) CEQA.3
B. Dismissal of the fair housing-related claims
1. The allegations
In the operative third amended complaint,4 the Coalition
alleged that the Project violated the Fair Housing Act and FEHA
due to the gentrification it would cause. Specifically, the
Coalition alleged that (1) the Project will lead to an “influx of
new, more affluent residents,” (2) this influx will lead to
“increased rents and increased property values that [will] put
pressure on existing, lower income residents” in the
neighborhoods near the Project, (3) these higher rents will “push”
the lower-income residents, who are “already rent-burdened”
because they spend more than 50 percent of their household
income on rent, “from their homes in the neighborhoods around
the Project,” and (4) this displacement will fall predominantly
upon “lower income Black and Latinx residents” living in those
neighborhoods. The danger of displacement due to the Project is
particularly high, the Coalition alleged, because a study
conducted by the City using data from 2000 to 2014 showed that
these neighborhoods already had a “high” or “very high” “index of
displacement.” The Coalition’s pleading acknowledged that “the
goal[s] of the Project” were “to serve as ‘a catalyst for economic
3 The initial pleading filed on July 30, 2018, was a petition
for a writ of mandate against the City alleging only a violation of
CEQA. The Coalition filed a first amended petition and
complaint on September 24, 2018, which added the two housing
discrimination claims against the City and the developer.
4 The trial court had sustained the City and the developer’s
demurrer to the second amended complaint with leave to amend.
8
development in South Los Angeles,’” “‘to contribute to the
revitalization of the West Adams-Baldwin Hills-Leimert Park’”
neighborhoods, and “‘to eliminate and prevent the spread of
blight and deterioration by providing housing ownership
opportunities, together with retail, hotel, office and restaurant
uses, and public open space,’” but alleged that this justification
was “no[t] legally sufficient” and could in any event “be served by
other, properly[ ]enacted policies, practices and decisions that
have a less discriminatory effect.” As relief, the Coalition sought
an injunction halting the Project unless and until “adequate
measures” were taken “to ensure that the Project would not
displace protected minorities.” The Coalition’s pleading did not
specify what measures would be adequate: At some points
during the administrative review process, the Coalition suggested
that setting aside all of the new, 961 residential units for low-
income residents; at other points, the Coalition suggested that
the developer also be required to build “other permanent
affordable housing . . . near the Project.
2. Demurrer
The City and the developer demurred to the Coalition’s fair
housing-related claims. After briefing and a hearing, the trial
court in May 2019 overruled the demurrer. Specifically, the court
found that the City’s decision approving the 20-year-long Project
constituted a “policy” (rather than a “one-off decision”) and that
the Coalition had “met its pleading burden” of alleging that the
Project would have a “disparate impact” by “displac[ing] Black
and Latinx populations in the immediate environs.”
3. Motion for judgment on the pleadings
In July 2020, the City and the developer filed a motion for
judgment on the pleadings based on new case law—namely, the
9
opinion in AIDS Healthcare Foundation v. City of Los Angeles
(June 15, 2020, B303308), review den. and opn. ordered nonpub.
Sept. 2, 2020, S263550 (AIDS Healthcare), which rejected a
gentrification-based lawsuit under the Fair Housing Act. After
briefing and a hearing, the trial court granted the motion. The
court ruled that AIDS Healthcare was “equally applicable” in this
case “because of the substantially similar allegations.”
C. Dismissal of CEQA Claim
In the second amended complaint, the Coalition alleged
that the City had violated CEQA. The City demurred to that
claim. In February 2019, the trial court sustained the demurrer
(and granted leave to amend, but the Coalition elected not to do
so and instead to stand on its claim as previously alleged). The
court found that the Coalition’s challenge to the City’s CEQA
finding was untimely because the Coalition’s July 2018 lawsuit
was filed more than 30 days after the City posted its notice of
determination in March 2017 and, alternatively, more than 180
days after the City’s anointed advisory agency approved the
vesting tentative tract map and certified the final environmental
impact report in January 2017.
D. Appeal
Following the entry of judgment against the Coalition on
all of its claims in September 2020, the Coalition filed this timely
appeal.
DISCUSSION
The Coalition argues that the trial court (1) erred in
granting judgment on the pleadings on its Fair Housing Act and
FEHA claims because the California Supreme Court
subsequently ordered the AIDS Healthcare decision depublished,
10
and (2) erred in sustaining the demurrer to its CEQA claim
because its July 2018 lawsuit was timely filed.
Our task in evaluating orders granting judgment on the
pleadings or sustaining a demurrer without leave to amend is the
same: We accept as true the allegations in the operative pleading
along with any documents properly subject to judicial notice, and
ask (1) whether the pleading states a “legally cognizable cause of
action” and, if it does, (2) whether the pleading also alleges facts
sufficient to support that cause of action. (IMO Development
Corp. v. Dow Corning Corp. (1982) 135 Cal.App.3d 451, 457;
Sparks v. City of Compton (1976) 64 Cal.App.3d 592, 596-597;
Alameda County Waste Management Authority v. Waste
Connections US, Inc. (2021) 67 Cal.App.5th 1162, 1174 (Alameda
County); Code Civ. Proc., § 438, subds. (c)(1)(B) & (d).) Our
review is de novo. (Alameda County, at p. 1174.) Leave to amend
is properly denied when a plaintiff’s underlying theory is legally
invalid and cannot be cured by additional allegations. (Yvanova
v. New Century Mortgage Corp. (2016) 62 Cal.4th 919, 924.)
I. Fair Housing Act and FEHA Claims
The Coalition contends that the trial court’s dismissal of its
Fair Housing Act and FEHA claims was legally incorrect. Before
addressing the viability of the Coalition’s claim under each
statute, we address two threshold issues.
A. Threshold issues
1. Automatic reversal
The Coalition asserts that we need not analyze the viability
of its claims under the Fair Housing Act or FEHA because (1) the
trial court’s ruling granting judgment on the pleadings was based
solely on the AIDS Healthcare opinion, and the depublication of
that opinion means that there is no basis for the court’s ruling,
11
which must therefore be automatically reversed; and (2) we may
not consider any further arguments in favor of affirmance
because (a) the City and the developer never sought appellate
review of the trial court’s earlier order overruling their demurrers
to these claims, and (b) the City and the developer are judicially
estopped from making any argument in favor of dismissal beyond
an AIDS Healthcare-based argument because such arguments
would be inconsistent with their earlier position that AIDS
Healthcare alone warranted dismissal.
We reject these arguments.
To begin, the depublication of AIDS Healthcare is not
dispositive of this appeal. Our task is to review the ruling
dismissing the Coalition’s claims, not its rationale. (Alameda
County, supra, 67 Cal.App.5th at p. 1174; People v. Zapien (1993)
4 Cal.4th 929, 976 [noting “firmly established” rule that appellate
courts review the trial court’s ruling, not its rationale].) Nor can
we infer our Supreme Court’s disapproval of the reasoning or
holding of AIDS Healthcare from the fact of depublication; the
California Rules of Court expressly preclude us from doing so.
(Cal. Rules of Court, rule 8.1125(d) [“A Supreme Court order to
depublish is not an expression of the court’s opinion of the
correctness of the result of the decision or of any law stated in the
opinion.”]; accord, Farmers Ins. Exchange v. Superior Court
(2013) 218 Cal.App.4th 96, 108.)
We are also not barred from considering alternative
arguments in support of the trial court’s order. The failure of the
City and the developer to seek appellate review of the trial court’s
prior order overruling their demurrers to the third amended
complaint is of no moment. They had no right to appeal that
prior order in the first place (e.g., Apple Inc. v. Superior Court
12
(2017) 18 Cal.App.5th 222, 238-239 [“‘An order overruling a
demurrer is not directly appealable . . . .’”]), and their failure to
seek a discretionary writ from that prior order would not have
precluded them from attacking that ruling in an appeal from a
final judgment (e.g., People v. Mena (2012) 54 Cal.4th 146, 156);
their failure to seek appellate review therefore does not preclude
them from making arguments that attack the prior demurrer
ruling when articulating alternative grounds for affirming the
trial court’s subsequent order granting their motion for judgment
on the pleadings. The City and the developer are also not
judicially estopped from making arguments beyond those based
on AIDS Healthcare. Judicial estoppel only precludes a litigant
from taking inconsistent positions before a tribunal (e.g., MW
Erectors, Inc. v. Niederhauser Ornamental & Metal Works Co.,
Inc. (2005) 36 Cal.4th 412, 422); arguing that a theory is invalid
for one reason is not inconsistent with arguing that a theory is
invalid for another reason, at least where, as here, the reasons
are in the alternative and not inconsistent with one another.
Indeed, the Code of Civil Procedure expressly authorizes a
litigant to file a motion for judgment on the pleadings after filing
an unsuccessful demurrer if the motion for judgment on the
pleadings is made on a different ground. (Code Civ. Proc., § 438,
subd. (g)(2).) Here, the grounds advanced in the prior demurrer
are different from the ground upon which we are now affirming.
2. Scope of this appeal
The Coalition’s gentrification theory implicates issues of
urban renewal, socioeconomic inequality, and racial injustice.
How to balance the social benefits of revitalizing blighted
neighborhoods against the resulting social costs of gentrification
is a question for our elected officials—not for this court. Elected
13
officials are the ones who must grapple with these issues in
deciding which projects to approve, where they should be sited,
and how to mitigate the potential negative impacts of those
projects on the surrounding neighborhoods by requiring or
incentivizing developers to take actions that benefit local
residents (such as setting aside affordable housing or employing
local labor). (E.g., L.A. Mun. Code §§ 12.22.A.25, 12.22.A.31,
12.24.U.26, 14.00.A.10; L.A. Admin. Code, § 5.582.)
Our task is much more limited: We decide only whether
the claims that the Coalition alleged in the operative complaint
are legally cognizable under the Fair Housing Act and FEHA.
For the reasons described below, the Inclusive Communities
decision by the United States Supreme Court dictates the
conclusion that they are not.
B. Fair Housing Act claim
1. The Fair Housing Act, generally
As its name suggests, the aim of the Fair Housing Act is “to
provide, within constitutional limitations, for fair housing
throughout the United States.” (42 U.S.C. § 3601; 82 Stat. 81.)
To do this, and among other ways, the statute makes it unlawful
to “make . . . unavailable . . . a dwelling to any person because of
race, color, religion, sex, familial status, or national origin.” (42
U.S.C. § 3604(a).)5 As pertinent here, “[a] dwelling can be made .
. . unavailable by, among other things, [a practice or policy] that
limits the availability of affordable housing” for protected groups.
5 In full, this provision provides that it shall be unlawful “[t]o
refuse to sell or rent after the making of a bona fide offer, or to
refuse to negotiate for the sale or rental of, or otherwise make
unavailable or deny, a dwelling to any person because of race,
color, religion, sex, familial status, or national origin.” (42 U.S.C.
§ 3604(a).)
14
(Mt. Holly Gardens Citizens in Action, Inc. v. Township of Mt.
Holly (3d Cir. 2011) 658 F.3d 375, 381 (Mt. Holly).)
There are two types of Fair Housing Act claims. The first is
a disparate treatment claim. To prevail, the plaintiff bringing a
disparate treatment claim “‘must establish that the defendant
had a discriminatory intent or motive’” when it undertook the
challenged practice or policy. (Inclusive Communities, supra, 576
U.S. at p. 524, quoting Ricci v. DeStefano (2009) 557 U.S. 557,
577.) The second is a disparate impact claim. To prevail, the
plaintiff bringing a disparate impact claim must establish that
the challenged practice or policy has “a ‘disproportionately
adverse effect on minorities [or other protected group]’ and [is]
otherwise unjustified by a legitimate rationale.” (Inclusive
Communities, at p. 524; see also id. at p. 534.)
2. Disparate impact claims, specifically
Disparate impact claims are critical to the efficacy of the
Fair Housing Act. Liability that turns solely on a showing of
discriminatory impact (rather than upon discriminatory intent or
motive) “permits plaintiffs to counteract unconscious prejudices
and disguised animus,” and thus “serves to uncover unconscious
or consciously hidden biases.” (Inclusive Communities, supra,
576 U.S. at p. 540; Avenue 6E Investments, LLC v. City of Yuma
(9th Cir. 2016) 818 F.3d 493, 503 (Avenue 6E).) Liability that
turns solely on a showing of discriminatory impact (rather than
upon discriminatory intent or motive) “also targets ‘artificial,
arbitrary, and unnecessary barriers’ to minority housing and
integration that can occur through unthinking, even if not
malignant, policies” and practices. (Avenue 6E, at p. 503, quoting
Inclusive Communities, at p. 540.)
15
At the same time, the United States Supreme Court has
held that the Fair Housing Act is not a panacea against all
wrongs. Instead, it was enacted to address historically
entrenched “segregated housing patterns” and was designed to
end that segregation by “eradicat[ing] discriminatory practices
within [the housing] sector” that “exclude minorities.” (Inclusive
Communities, supra, 576 U.S. at pp. 528, 539.) It was not meant
to “displace[] . . . valid governmental policies.” (Id. at p. 540.)
Because disparate impact liability looks solely to disproportionate
effect without regard to the intent or motive behind the practice
or policy, and because a practice or policy may end up having a
disproportionate effect on minorities even when it serves a valid
government policy, the Supreme Court has seen fit to “properly
limit[]” disparate impact claims by articulating “safeguards” and
“cautionary standards” to ensure that such claims do not sweep
beyond the purpose—and hence the scope—of the Fair Housing
Act. (Inclusive Communities, at pp. 540, 541, 544; Oviedo Town
Center II, L.L.L.P. v. City of Oviedo (11th Cir. 2018) 759
Fed.Appx. 828, 834 (Oviedo Town Center) [observing how
Inclusive Communities “cabin[ed] disparate-impact liability”
because that “theory of liability . . . would create substantial
difficulties if applied too expansively”].) Whether “the merits” of
an alleged disparate impact claim remain within these limits is to
be “rigorous[ly] examin[ed]” “at the pleading stage.” (Burbank
Apartments Tenant Assn. v. Kargman (2016) 474 Mass. 107, 127
(Burbank Apartments).) Disparate impact claims that fall
outside “the purview” of the Fair Housing Act are not legally
cognizable and are properly dismissed at that stage. (Laramore
v. Illinois Sports Facilities Auth. (N.D.Ill. 1989) 722 F.Supp. 443,
452; Southend Neighborhood Improvement Assn. v. County of St.
16
Clair (7th Cir. 1984) 743 F.2d 1207, 1210 [dismissal is
appropriate when the Fair Housing Act was “not designed to
address the concerns raised by the complaint”].)
Three of the “cautionary standards” and “safeguards”
articulated in Inclusive Communities are relevant here.
First, Inclusive Communities held that the Fair Housing
Act does not encompass disparate impact claims that “cause[]
race to be used and considered in a pervasive and explicit manner
to justify governmental or private actions” because construing the
Fair Housing Act to “inject[] race into a city’s decisionmaking
process” raises “serious constitutional concerns” and “ten[d]s to
perpetuate race-based considerations rather than move beyond
them.” (Inclusive Communities, supra, 576 U.S. at pp. 542-543;
Oviedo Town Center, supra, 759 Fed.Appx. at p. 834.) Put
differently, courts are not to interpret “disparate-impact liability”
under the Fair Housing Act “to be so expansive as to inject racial
considerations into every housing decision.” (Inclusive
Communities, at p. 543; accord, Wards Cove, supra, 490 U.S. at p.
654 [interpreting the anti-discrimination provisions of Title VII of
the Civil Rights Act in a way that “almost inexorably lead[s] to
the use of numerical quotas in the workplace” is “a result that
Congress and this Court have rejected repeatedly in the past”].)
Second, Inclusive Communities held that the Fair Housing
Act does not encompass disparate impact claims that coopt the
act into an “instrument to force housing authorities to reorder
their priorities” and thereby “displace[] . . . valid governmental
policies.” (Inclusive Communities, supra, 576 U.S. at p. 540.)
This is because the Fair Housing Act “does not decree a
particular vision of urban development” and “does not put
housing authorities and private developers in a double bind of
17
liability, subject to suit” no matter where they authorize and
build “new low-income housing.” (Id. at p. 542; Inclusive
Communities Project, Inc. v. Lincoln Property Co. (5th Cir. 2019)
920 F.3d 890, 903 (Lincoln).) A disparate impact claim lies
beyond the purview of the Fair Housing Act if “the specter of
disparate-impact litigation [on the theory underlying a Fair
Housing Act claim] causes private developers to no longer
construct or renovate housing units for low-income individuals”
because, by recognizing such a claim, “the [Fair Housing Act]
would have undermined its own purpose as well as the free-
market system.” (Inclusive Communities, at p. 544.)
Third, Inclusive Communities acknowledged that, while the
Fair Housing Act does not categorically prohibit the consideration
of race “in certain circumstances and in a proper fashion,” the act
will not sanction disparate-impact claims that have the effect of
“perpetuating” “racial isolation” and segregation. (Inclusive
Communities, supra, 576 U.S. at pp. 540, 545, 546; Southwest
Fair Housing Council, Inc. v. Maricopa Domestic Water
Improvement District (9th Cir. 2021) 17 F.4th 950, 960
(Southwest Fair Housing) [the Fair Housing Act “‘forbids actions .
. . that . . . perpetuate housing segregation’”]; cf. Resident
Advisory. Bd. v. Rizzo (3d Cir. 1977) 564 F.2d 126, 129, 143
[public agency’s obstruction of project that would further racial
integration of community is actionable].) That is because the
Fair Housing Act’s underlying and overarching tenet is to “mov[e]
the Nation toward a more integrated society.” (Inclusive
Communities, at pp. 546-547.) Contrary to what the Coalition
argues, nothing in Inclusive Communities limits the Fair Housing
Act’s prohibitions against claims perpetuating segregation to only
that subset of segregation that is “to the detriment of minorities.”
18
3. Analysis
The gentrification-based theory of liability alleged by the
Coalition is not a legally cognizable disparate impact claim under
the Fair Housing Act because it runs afoul of the three
“cautionary standards” articulated above.
The gentrification theory necessarily injects racial
considerations into the City’s decisionmaking process. That is
because this theory is premised on the allegation that the persons
displaced by the gentrification are members of minority groups.
The race-dependent availability of the gentrification theory is a
function of the scope of the Fair Housing Act’s protections. The
Fair Housing Act only prohibits policies and practices that
discriminate—by intent or by effect—on the basis of “race, color,
religion, sex, familial status, or national origin.” (42 U.S.C. §
3604 (a).) The Fair Housing Act does not reach discrimination on
the basis of socioeconomic status (United States v. City of
Birmingham (E.D.Mich. 1982) 538 F.Supp. 819, 830
[“discrimination on the basis of wealth” not prohibited by the Fair
Housing Act]; see generally, San Antonio Indep. School Dist. v.
Rodriguez (1973) 411 U.S. 1, 29 [“wealth discrimination” is not a
protected class under equal protection principles]), and does not
reach discrimination on the basis of race unless it has a
“‘significantly disparate impact on nonwhites’” (Hardie, supra,
876 F.3d at p. 319, quoting Wards Cove, supra, 490 U.S. at p. 658,
italics added). Thus, if gentrification were a valid theory for
relief under the Fair Housing Act, city officials would be required
to avoid gentrification-based displacement for a potential
development located in a majority minority community, but not
19
for one in a mostly white community.6 Thus, accepting
gentrification as a valid theory would inexorably “cause[] race to
be used and considered in a pervasive and explicit manner [in
deciding whether] to justify governmental or private actions,”
thereby “inject[ing] racial considerations into [the] decision.”
(Inclusive Communities, supra, 576 U.S. at p. 543.) Inclusive
Communities says such a theory is not cognizable under the Fair
Housing Act.
By requiring a developer either to dedicate every new
residential unit it builds to affordable housing and perhaps also
to obligate the developer to build additional affordable housing off
site in the adjoining neighborhoods, the net effect of the
gentrification theory is to summon “the specter of disparate-
impact litigation” in a way that would cause “private developers
to no longer construct or renovate housing units for low-income
individuals.” (Inclusive Communities, supra, 576 U.S. at p. 544.)
Inclusive Communities says such a theory is not cognizable under
the Fair Housing Act.
As the Coalition’s allegations make clear, the evil of
gentrification is that it “displace[s] Black and Latinx residents”
from some of the “the last majority Black communities in Los
Angeles.” According to the Coalition, this concentration of Black
6 Although whites have standing to raise Fair Housing Act
claims when nonwhites are victimized (e.g., Wentworth v. Hedson
(E.D.N.Y. 2007) 493 F.Supp.2d 559, 566 [so noting]), nonwhites
would not be victimized in significant measure by gentrification
that displaces mostly white residents (Southwest Fair Housing,
supra, 17 F.4th at p. 961 [requiring “‘a significantly . . .
disproportionate impact on persons’” belonging to a group
protected by the Fair Housing Act].)
20
residents and their Latinx neighbors is what forms “the political,
cultural, and commercial heart of Black Los Angeles.” The
Coalition’s gentrification theory exists to protect this
concentration of minority community members, and thus seeks to
employ the Fair Housing Act as a means of preserving the racial
composition of these communities. However politically,
culturally, historically, and commercially beneficial such
segregation might be for those resulting communities, the Fair
Housing Act was designed as a tool for “moving . . . toward a
more integrated society,” not a less integrated one. (Inclusive
Communities, supra, 576 U.S. at p. 547.) That the Coalition’s
gentrification theory is seeking to perpetuate the segregation of a
blended community of two minority groups (rather than a single
minority group) does not, as the Coalition suggests, mean that
the theory is not perpetuating segregation; that is because the
theory is still aimed at preventing the displacement of these
groups by others and is thus still designed to prevent a more fully
integrated community. Inclusive Communities says claims that
perpetuate segregation are inimical to the core purpose of the act
and, as such, are not cognizable under it.
4. The Coalition’s chief argument
The Coalition makes a two-part argument as to why we
must reverse the trial court’s grant of judgment on the
pleadings—namely, (1) its operative complaint sufficiently alleges
a prima facie case of disparate impact discrimination, and (2)
doing so is sufficient to ward off the City and the developer’s
attack on the sufficiency of the pleadings.
The concept of a prima facie case originated in precedent
arising under Title VII of the Civil Rights Act (42 U.S.C. § 2000e
et seq.) and the Age Discrimination in Employment Act (ADEA)
21
(29 U.S.C. § 621 et seq.). Being able to state a prima facie case is
the first step in a three-step, burden-shifting rubric that is
designed to assess the merit of disparate impact claims under
statutes authorizing such claims as a means of challenging
unlawful discrimination. (Southwest Fair Housing, supra, 17
F.4th at pp. 960-961.) In this first step, the plaintiff has the
burden of showing “a prima facie case of disparate-impact
discrimination.” (Id. at p. 960.) Under the Fair Housing Act, this
means the plaintiff must show that (1) the defendant has
implemented a facially neutral “policy” (rather than making a
“one-time decision”), (2) the policy has a “significantly adverse or
disproportionate effect” on a protected class, and (3) there is a
“robust” “causal connection” between the policy and the
disproportionate effect, which is typically demonstrated through
“statistical evidence.” (Inclusive Communities, supra, 576 U.S. at
pp. 542-543; Southwest Fair Housing, at p. 961; Oviedo Town
Center, supra, 759 Fed.Appx. at p. 834; Connecticut Fair Housing
Center v. CoreLogic Rental Property Solutions, LLC (D.Conn.
2020) 478 F.Supp.3d 259, 287 [referring to “robust causation” as
a species of “proximate cause”]; cf. Swierkiewicz v. Sorema N.A.
(2002) 534 U.S. 506, 511-512 [pleading alleging disparate impact
in an employment discrimination case need not plead a prima
facie case and need only include a “short and plain statement of
the claim” showing entitlement to relief].)7 The plaintiff’s burden
7 Inclusive Communities was the first decision to require the
more onerous showing of “robust causation.” Prior to that, a
plaintiff was required only to show that the defendant’s policy
“actually or predictably result[ed] in” a discriminatory impact
(Sisemore v. Master Financial, Inc. (2007) 151 Cal.App.4th 1386,
1420 (Sisemore)) or that the policy caused “a significantly adverse
or disproportionate impact” on a protected class (Committee
22
during this first step “is not intended to be ‘onerous[]’ [citation]”
because “a prima facie case, by itself, is not enough to establish
liability under the [Fair Housing Act]” and is meant to be an
entrée to further analysis. (Avenue 6E, supra, 818 F.3d at p. 513;
Mt. Holly, supra, 658 F.3d at p. 385; Abed v. Western Dental
Services, Inc. (2018) 23 Cal.App.5th 726, 739.) If the plaintiff
carries his burden, the rubric moves to the second step, where
“the burden shifts to the defendant” to prove that its policy “is
necessary to achieve a valid” and “legitimate interest.” (Inclusive
Communities, at p. 541; Mt. Holly, at p. 382; Southwest Fair
Housing, at p. 967.) For these purposes, “necessary” does not
mean “essential” or “indispensable”; instead, it means that the
policy “in a significant way” “serves” “a legitimate business [or
governmental] interest.” (Southwest Fair Housing, at pp. 967-
968.) And if the defendant carries the burden in this second step
of showing a justifiable policy, then the rubric moves to the third
step, where “the burden shifts back to the plaintiff to show the
availability of an alternative practice that has less discriminatory
impact yet is still equally effective in serving the defendant’s
legitimate goals.” (Southwest Fair Housing, at p. 961; Inclusive
Communities, at p. 533.)
We need not address the parties’ lengthy arguments about
whether the Coalition has sufficiently alleged a prima facie case
of disparate impact discrimination under the Fair Housing Act
because we will assume, for sake of argument, that it has done so
Concerning Community Improvement v. City of Modesto (9th Cir.
2009) 583 F.3d 690, 711).
The federal courts are deeply divided over precisely what
showing satisfies Inclusive Communities’s “robust causation” test.
(See Lincoln, supra, 920 F.3d at pp. 903-907 [detailing a four-way
split on the meaning of this test].)
23
and has thereby established the first part of its two-part
argument.8 However, we conclude that the Coalition has not
established the second part of its argument because the
Coalition’s success in alleging a prima facie case does not insulate
its disparate-impact claim from the dismissal compelled by
Inclusive Communities.
That is because the three-step, burden-shifting rubric is
merely an evidentiary standard designed to shift the burden of
production back and forth in order to suss out the valid disparate
impact claims from the invalid. (Inclusive Communities, supra,
576 U.S. at p. 527; Southwest Fair Housing, supra, 17 F.4th at p.
961.) At all times, the burden of proof remains with the Fair
Housing Act plaintiff. (Southwest Fair Housing, at p. 967 [“‘[t]he
ultimate burden of proving that discrimination against a
protected group has been caused by a specific . . . practice
8 Our assumption renders it unnecessary to address whether
(1) the three-step, burden-shifting rubric is defined by Inclusive
Communities or instead by regulations promulgated by the
United States Department of Housing and Urban Development
(HUD) (compare National Fair Housing Alliance v. Travelers
Indemnity Co. (D.D.C. 2017) 261 F.Supp.3d 20, 22 [applying
Inclusive Communities’s “more stringent” test]; Southwest Fair
Housing, supra, 17 F.4th at p. 961, fn. 6 [same]; Lincoln, supra,
920 F.3d at pp. 901-903 [same] with Burbank Apartments, supra,
474 Mass. at p. 126 [applying HUD regulations]; Mhany
Management, Inc. v. County of Nassau (2d Cir. 2016) 819 F.3d
581, 617-620 [same]); (2) a Fair Housing Act plaintiff must allege
that the policy at issue constitutes an “artificial, arbitrary, and
unnecessary barrier[]” to housing as part of its prima facie case
(see Ellis v. City of Minneapolis (8th Cir. 2017) 860 F.3d 1106,
1112 (Ellis) [so requiring]; Khan v. City of Minneapolis (8th Cir.
2019) 922 F.3d 872, 874 [same]); and (3) the Coalition’s causation
allegations satisfy the “robust causation” standard.
24
remains with the plaintiff at all times.”’”]; Wards Cove, supra,490 U.S. at p. 659 [“The burden of persuasion . . . remains with
the disparate-impact plaintiff.”].) This is why “‘the establishment
of a prima facie case, by itself, is not enough to establish liability
under the [Fair Housing Act].’” (Avenue 6E, supra, 818 F.3d at p.
513; Mt. Holly, supra, 658 F.3d at p. 385; cf. A.F. Arnold & Co. v.
Pacific Professional Ins., Inc. (1972) 27 Cal.App.3d 710, 715 [lack
of justification is an affirmative defense to a tort; it is not an
intermediary step in a mechanism shifting the burden of
production].) Thus, the Coalition—as the plaintiff—has always
borne the burden of establishing that its gentrification-based,
disparate impact claim is cognizable under the Fair Housing Act.
As explained above, Inclusive Communities dictates that the
Coalition cannot carry that burden based on the gentrification
theory it advances.
The Coalition responds that a plaintiff’s ability to
sufficiently allege a prima facie entitlement to relief is always
enough to defeat a challenge to the pleadings in a disparate
impact case because the last two steps of the burden-shifting
rubric—namely, whether the impact is justified and is
sufficiently tailored—may only be addressed in a subsequent
motion for summary judgment. More specifically, the Coalition
asserts that Inclusive Communities’s safeguards are already
accounted for in the three-step, burden-shifting mechanism and
in the “robust causality” requirement of the plaintiff’s “prima
facie” case, and thus have no independent force. For support, the
Coalition cites Sisemore, supra, 151 Cal.App.4th at p. 1423,
Schnall v. Hertz Corp. (2000) 78 Cal.App.4th 1144, 1167
(Schnall), and De Reyes, supra, 903 F.3d at pp. 430-432. Thus,
25
the Coalition concludes, it should be permitted to proceed beyond
the pleadings stage of its lawsuit.
We reject this argument on legal and factual grounds.
As a legal matter, Inclusive Communities forecloses
allowing the Coalition’s gentrification-based disparate impact
claim to proceed any further. Although Sisemore, Schnall, and
De Reyes suggest that the second and third steps of the burden-
shifting rubric are typically to be litigated on a motion for
summary judgment rather than on demurrer or a motion for
judgment on the pleadings, Inclusive Communities dictates that
we reject that approach here. As explained above, the Coalition’s
gentrification-based theory is not cognizable under the Fair
Housing Act because that theory, by its very nature, is
inconsistent with Inclusive Communities’s holding that the Fair
Housing Act may not be used to inject race into land use
decisions, to discourage the construction of affordable housing, or
to perpetuate segregation. Allowing the case to move forward in
order to allow for the discovery of additional facts cannot change
the fundamental legal inconsistency between the Coalition’s
theory and the Fair Housing Act. As a result, judgment in favor
of the City and the developer is preordained. This is true because
the gentrification-based theory will be just as uncognizable on
summary judgment as it is on the pleadings, and because the
City and the developer will prevail on the last two steps of the
burden-shifting rubric in any event: “[A]lleviating blight is a
legitimate interest” (Mt. Holly, supra, 658 F.3d at p. 385), and the
“safeguards” that Inclusive Communities pronounced and that
dictate our conclusion that the gentrification theory falls outside
the Fair Housing Act are to be considered in the third step of the
burden-shifting rubric (Southwest Fair Housing, supra, 17 F.4th
26at pp. 970-971) and dictate dismissal. Allowing the Coalition’s
Fair Housing Act claim to proceed while knowing to a certainty
that it would be dismissed on summary judgment would
undermine Inclusive Communities’s pronouncement that “prompt
resolution of these cases is important.” (Inclusive Communities,
supra, 576 U.S. at p. 543; accord, Ellis, supra, 860 F.3d at p.
1111.) Although, as the Coalition points out, Inclusive
Communities made its pronouncement about the need for prompt
resolution” at the summary judgment stage of that case, the
concerns animating the need for prompt resolution of a Fair
Housing Act claim that is not cognizable apply with equal force at
the pleading stage; otherwise, a defendant would have to incur
the time and expense of extensive discovery and summary
judgment litigation simply to obtain a dismissal to which it was
entitled at the pleading stage.
As a factual matter, we may not focus solely on the first,
prima facie case step because the Coalition has also made
allegations in its operative pleading regarding the second and
third steps that we cannot ignore. (Cf. Schnall, supra, 78
Cal.App.4th at p. 1167 [“since the complaint is unlikely to reveal
defendant’s justification—if [the] pleading states a prima facie
case of harm . . . the defendant should be made to present its side
of the story”].) Specifically, the Coalition alleged the City’s and
the developer’s stated justification for the Project (namely, that it
would “serve as a catalyst for economic development” and
“contribute to the revitalization” of the area); alleged that this
justification was “[n]ot legally sufficient”; and alleged that the
justification could in any event “be served by other, properly
enacted policies, practices and decisions that have a less
discriminatory effect.” Even if the Coalition had not made those
27
allegations expressly in its operative pleading, the City’s and the
developer’s proffered justifications and the Coalition’s responses
to them were part of the public record that was judicially noticed
by the trial court in adjudicating the motions below. (See Evid.
Code, § 452; Code Civ. Proc., § 438, subd. (d).) Thus, the last two
steps were at issue in this case and, for the reasons noted above,
dictate dismissal of the Coalition’s gentrification-based, disparate
impact claim.
C. FEHA Claim
Among other things, FEHA makes it unlawful “to . . . make
unavailable or deny a dwelling based on discrimination because
of race, color,” or several other protected characteristics. (Gov.
Code, § 12955, subd. (k).) FEHA expressly extends its
prohibitions to policies and practices that have a “discriminatory
effect.” (Id., § 12955.8, subd. (b).) By borrowing language from
the Fair Housing Act, FEHA was meant to provide
“‘“substantially equivalen[t]”’” protections to its federal
counterpart. (Konig v. Fair Employment & Housing Commission
(2002) 28 Cal.4th 743, 749.) But FEHA’s protections are not
identical: FEHA may not provide “fewer rights or remedies than
the federal Fair Housing Act” supplies, yet FEHA is to be
“construed liberally” and “may be construed to afford greater
rights and remedies . . . than those afforded by federal law.”
(Gov. Code, §§ 12955.6, 12993, subd. (a), italics added; Auburn
Woods I Homeowners Assn. v. Fair Employment & Housing
Comm. (2004) 121 Cal.App.4th 1578, 1590-1591 (Auburn Woods),
italics added.)
The Coalition argues that the dismissal of its Fair Housing
Act claim is not dispositive of its FEHA claim because FEHA can
afford broader relief. Of course, that FEHA can be construed to
28
be broader than the Fair Housing Act does not mean that it must
always be construed to be broader or that it inevitably must be so
construed in any particular case. Here, it must not. California
courts “often look to cases construing the [Fair Housing Act] . . .
when interpreting FEHA.” (Auburn Woods, supra, 121
Cal.App.4th at p. 1591; Sisemore, supra, 151 Cal.App.4th at p.
1420.) Inclusive Communities is the critical case delimiting the
scope of disparate impact claims under the Fair Housing Act, and
thus is pertinent to the construction of FEHA. More to the point,
the safeguards that Inclusive Communities built into disparate
impact claims under the Fair Housing Act would seem to be
equally pertinent to such claims under FEHA—namely, the
concern that such claims not be used to coopt FEHA into a tool
for injecting race into city planning decisions, for discouraging
affordable housing, or for perpetuating racial segregation in
housing patterns. (Accord, Mahler v. Judicial Council of
California (2021) 67 Cal.App.5th 82, 113 [interpreting FEHA
through the lens of Inclusive Communities and its concern about
“‘abusive disparate-impact claims’”].)
We therefore conclude that the Coalition’s FEHA claim
must be rejected for the same reasons as its Fair Housing Act
claim.
II. CEQA Claim
The Coalition argues that the trial court erred in
sustaining the demurrer to its CEQA claim on the grounds of
untimeliness.
A. CEQA and CEQA review, generally
CEQA is designed “‘to “[e]nsure that the long-term
protection of the environment shall be the guiding criterion in
public decisions.”’” (Friends of College of San Mateo Gardens v.
29
San Mateo County Community College Dist. (2016) 1 Cal.5th 937,
944, quoting No Oil, Inc. v. City of Los Angeles (1974) 13 Cal.3d
68, 74.) CEQA operates, not by dictating proenvironmental
outcomes, but rather by mandating that “decision makers and the
public” study the likely environmental effects of contemplated
government actions and thus make fully informed decisions
regarding those actions. (Neighbors for Smart Rail v. Exposition
Metro Line Construction Authority (2013) 57 Cal.4th 439, 447;
Cal. Code Regs., tit. 14, § 15002, subd. (a)(1) [a “basic purpose[] of
CEQA [is] to . . . [¶] . . . [i]nform governmental decision makers
and the public about the potential, significant environmental
effects of proposed activities.”].)
Once a public agency has approved a project after
considering the environmental effects of that project, CEQA
allows for judicial review of the agency’s compliance with CEQA.
(Pub. Resources Code, § 21167.) But “[t]o ensure finality and
predictability in public land use planning decisions,” “CEQA
provides unusually short statutes of limitations on filing court
challenges to the approval of projects . . . .” (Cal. Code Regs., tit.
14, § 15112, subd. (a); Stockton Citizens for Sensible Planning v.
City of Stockton (2010) 48 Cal.4th 481, 499 (Stockton).)
As pertinent here, CEQA requires a party seeking to
challenge a public agency’s approval of a project due to alleged
noncompliance with CEQA to file that challenge in court (1)
within 30 days of when the agency posts a notice of
determination, which must be posted within five days of the
approval itself and must be publicly posted for a full 30 days; or
(2) with 180 days of the public agency’s “decision to carry out or
approve the project.” (Pub. Resources Code, §§ 21167, subds. (a),
(b), (c) & (e), 21152, subds. (a) & (c); Cal. Code Regs., tit. 14, §
30
15112, subd. (c)(1) & (5); Citizens for a Green San Mateo v. San
Mateo County Community College (2014) 226 Cal.App.4th 1572,
1589-1590; Sierra Club v. City of Orange (2008) 163 Cal.App.4th
523, 532.)
An untimely filed challenge is to be dismissed. (Cal. Code
Regs., tit. 14, § 15112, subd. (b); Stockton, supra, 48 Cal.4th at p.
499.)
B. Analysis
Because the Coalition first filed its CEQA challenge 558
days9 after the Department of City Planning approved the
vesting tentative tract map and certified the final environmental
impact report for the Project, the timeliness of the Coalition’s
CEQA challenge boils down to whether the Department’s actions
on January 18, 2017, constituted a “decision to carry out or
approve” the Project. We conclude that they did.10
For purposes of assessing the timeliness of a CEQA
challenge, approval of a project “means the decision by a public
agency which commits the agency to a definite course of action in
regard to a project . . . .” (Cal. Code Regs., tit. 14, § 15352, subd.
(a); Stockton, supra, 48 Cal.4th at pp. 505-506.) “With private
projects” like the one in this case (that is, a project to be built by
a private developer), “approval occurs upon [(1)] the earliest
commitment to issue or [(2)] the issuance by the public agency of
a discretionary contract, grant, subsidy, loan, or other form of
9 There are 558 days between January 18, 2017, and July 30,
2018.
10 Our decision to rely on the 180-day limitations period
obviates any need for us to address the parties’ arguments
regarding the 30-day limitations period and the validity of the
notice of determination posted by the Department.
31
financial assistance, lease, permit, license, certificate, or other
entitlement for use of the project.” (Cal. Code. Regs., tit. 14, §
15352, subd. (b).) “No particular form of approval is required.”
(Stockton, supra, 48 Cal.4th at p. 506.)
Here, the Department’s approval of the vesting tentative
tract map constitutes an “approval” for purposes of CEQA
because it constituted the “issuance by a public agency of a
discretionary . . . entitlement for use of the Project.” The
Department was authorized to issue that approval (and to certify
the final environmental impact report) because the City Council,
consistent with the Municipal Code, had delegated that authority
to the Department. (L.A. Muni. Code, §§ 17.03, 17.06.A.2; Pub.
Resources Code, § 21151, subd. (c); Cal. Code Regs., tit. 14, §§
15090, subd. (b), 15025; cf. California Clean Energy Committee v.
City of San Jose (2013) 220 Cal.App.4th 1325, 1340 [delegation
not sanctioned by local law is invalid].) Further, and as dictated
by statute, the Department’s approval of a vesting tentative tract
map—whether conditional or unconditional—“confer[s] [upon the
developer] a vested right to proceed with development in
substantial compliance with the ordinances, policies, and
standards” in effect at the time of approval. (Gov. Code, §
66498.1, subd. (b); Kaufman & Broad Central Valley, Inc. v. City
of Modesto (1994) 25 Cal.App.4th 1577, 1586, 1588 [noting that
this statute was “intended to create a vested right affording
greater protection and arising earlier in the development process
than the right available under the common law doctrine”].) This
vested right enables ‘“[t]he private sector . . . to rely upon an
approved vesting tentative [tract] map prior to expending
resources and incurring liabilities without the risk of having the
project frustrated by subsequent action by the approving [public]
32
agency . . . .”’ (Bright Development v. City of Tracy (1993) 20
Cal.App.4th 783, 793, quoting Gov. Code, § 66498.9.) Because it
vests rights to proceed with the project in the private developer,
the approval of a vesting tentative tract map constitutes an
“entitlement for use of the project” that falls comfortably within
the definition of “approval” for CEQA purposes.
C. The Coalition’s arguments
The Coalition makes what boils down to three categories of
arguments in support of its position that the Department’s
approval of the vesting tentative tract map and its simultaneous
certification of the final environmental impact report did not
constitute an “approval” of the Project for CEQA purposes.
First, the Coalition argues that the Department’s actions
do not constitute an “approval” because, at that time, the City
Council had yet to approve the City’s development agreement
with the developer and had yet to approve the height and zoning
district changes necessary to implement the Project. We reject
this argument. The Department’s approval of the vesting
tentative tract map granted the developer an entitlement to
proceed with the Project. That the implementation of the Project
was contingent on further approvals outside the Department’s
purview to grant does not negate the entitlement conferred by the
Department’s approval of the vesting tentative tract map, and
thus does not preclude the approval of the tract map from
constituting an “approval” for purposes of CEQA. (See Save Tara
v. City of West Hollywood (2008) 45 Cal.4th 116, 132-133 [CEQA
“does not establish that a conditional agreement for development
never constitutes approval of the development”].) As our
Supreme Court put it, the pertinent regulations “define
[‘]approval’ as occurring when the agency first exercises its
33
discretion to execute a contract or grant financial assistance [or
take other actions committing it to a project], not when the last
such discretionary decision is made.” (Id. at p. 134, original
italics.)
Second, the Coalition argues that a “project” is defined as
“the whole of an action” (Cal. Code Regs., tit. 14, § 15378, subd.
(a)); that a project thus cannot be approved until all of the
necessary approvals are conferred and all administrative appeals
have been exhausted; and that this degree of finality was not
attained until the City Council enacted ordinances granting the
height and zoning district changes, approved the development
agreement, and denied all earlier administrative appeals. We
reject this argument. It is specifically foreclosed by the CEQA
regulations themselves: “The term ‘project’ refers to the activity
which is being approved and which may be subject to several
discretionary approvals by government agencies. The term
‘project’ does not mean each separate governmental approval.”
(Cal. Code Regs., tit. 14, § 15378, subd. (c), italics added; Citizens
for a Megaplex-Free Alameda v. City of Alameda (2007) 149
Cal.App.4th 91, 105.) Although, as the Coalition notes, courts
have sometimes cited the definition of the term “project” to assess
whether “approval” is required, they have done so in order to
assess whether the underlying activity had sufficiently coalesced
to be deemed a “project” that could be approved. (Save Tara,
supra, 45 Cal.4th at pp. 134-135, 139.)
Lastly, the Coalition argues that the City should be
equitably estopped from invoking the CEQA limitations period
because it misled the public in the public notice announcing the
Department’s December 2016 meeting when the vesting tentative
tract map was to be approved and the final environmental impact
34
report was to be certified. Specifically, the Coalition observes
that the notice states that the Department itself was to consider
these matters and, at the same time, states that “written
comments” on those subjects “will be provided to the City
Planning Commission” and that the final environmental impact
report “will be submitted to the City Planning Commission and
City Council for requested certification and action.” According to
the Coalition, the latter portions were misleading because they
suggested that the Department was merely acting as a hearing
officer for the Planning Commission and City Council rather than
as a decision maker. We reject this argument for two reasons.
To begin, although equitable estoppel may be invoked against
public entities (Citizens for a Responsible Caltrans Decision v.
Department of Transportation (2020) 46 Cal.App.5th 1103, 1128-
1129 (Caltrans Decision)), its use is to be limited to “unusual
instances when necessary to avoid grave injustice and when the
result will not defeat a strong public policy” (City of Goleta v.
Superior Court (2006) 40 Cal.4th 270, 279). Further, and more to
the point, the notice does not satisfy the baseline standard for
invoking estoppel—let alone the heightened showing necessary to
invoke it against a public entity. The notice at issue is, at best,
unclear and ambiguous about whether the Department was
making final decisions or merely making recommendations to be
passed up the food chain to the Planning Commission and City
Council.11 But it is well settled that “‘[c]ertainty is essential to all
11 And this is a generous reading because the notice is
arguably not inaccurate or misleading at all. The notice did not
say that the vesting tentative tract map would be submitted to
the Planning Commission and City Council for action, and the
Planning Commission and City Council did review the
35
estoppels’” and that it is not enough that a person makes a
statement that is “‘doubtful or matter of questionable inference.’”
(Steinhart v. County of Los Angeles (2010) 47 Cal.4th 1298, 1318,
quoting Wheaton v. Insurance Co. (1888) 76 Cal. 415, 429-430.)
The Coalition points us to Caltrans Decision, but the agency in
that case unambiguously stated it would be preparing an
environmental impact report but instead turned around and filed
a notice of exemption that obviated the need for any impact
report. (Caltrans Decision, at pp. 1133-1134.)
DISPOSITION
The judgment is affirmed. The City and the developer are
entitled to their costs on appeal.
CERTIFIED FOR PUBLICATION.
______________________, J.
HOFFSTADT
We concur:
_________________________, P. J.
LUI
_________________________, J.
CHAVEZ
Department’s certification of the final environmental impact
report to determine whether any supplemental environmental
analysis was necessary (and both concluded that no such
supplemental analysis was warranted).
36