In the Absence of CEQA Review, In Lieu Fee Programs Cannot Presumptively Establish Full Mitigation of Environmental Impacts

The Third Appellate District Court of California held in the case California Native Plant Society v. County of El Dorado, that the payment of a rare plant impact in lieu fee, which was not reviewed under the California Environmental Quality Act (CEQA), does not presumptively establish that the environmental impacts to rare plants for all projects are fully mitigated such that a developer is entitled to a mitigated negative declaration.

El Dorado County had established by ordinance a program whereby developers would pay a rare plant impact fee that would be used to create rare plant habitat preserves. The County, however, never evaluated this program under CEQA. The County then relied on the fee program as full mitigation for the impacts of the proposed project, an Alzheimer’s residential and medical care center, on rare plants. At the planning commission hearing, several federal and county staff testified that the ordinance fee was not sufficient mitigation for the project’s impacts.

The Court held that because the fees set by the ordinance never passed a CEQA evaluation, “payment of these fees does not presumptively establish full mitigation for a discretionary project.” The fee is merely an “in lieu” regulation in which a developer may pay the fee in lieu of acquiring off-site habitat for impacted rare plants. The Court further held that for an in-lieu fee to adequately satisfy the duty to mitigate imposed by CEQA, the fee or the individual project must be evaluated by CEQA. The Court differentiated this case with Save Our Peninsula v. Committee v. Monterey County Bd. of Supervisors (2001) 87 Cal. App. 4th 99 , in which an EIR had already been prepared for the fee. The Court clarified that Save Our Peninsula simply means that fee-in-lieu programs may provide adequate mitigation to presumptively justify a MND, when reviewed under CEQA. The Court also rejected the County’s reliance on the General Plan EIR, holding that the General Plan EIR did not establish that the in lieu fee would fully mitigate impacts from all projects.