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April 16, 2024  |  Written by Casey A. Shorrock

Fifth District Appellate Court Revisits King & Gardiner Farms, Now Finding Agricultural Conservation Easements May Be Required Under CEQA As Partial Mitigation For Project’s Conversion Of Agricultural Land

In a partially published opinion—V Lions Farming, LLC v. County of Kern (2024) 100 Cal.App.5th 412—the Fifth District Court of Appeal held that even though agricultural conservation easements (ag easements) may only partially mitigate a project’s conversion of agricultural land, those easements are not obsolete under the California Environmental Quality Act (CEQA).

As background, agricultural land is defined by CEQA as “prime farmland, farmland of statewide importance, or unique farmland, as defined by the [USDA] land inventory and monitoring criteria, as modified for California.” (Pub. Resources Code, § 21060.1 (a).) In 2015, Kern County approved an ordinance streamlining the permitting process for new oil and gas wells, and the environmental impact report (EIR) prepared for that ordinance used a no-net-loss threshold of significance for agricultural land. The original EIR mitigated impacts to agricultural land to a less-than-significant level by requiring ag easements at a replacement ratio of 1:1 acre. Petitioners successfully challenged the EIR, but nevertheless appealed on several issues they had lost. The Fifth District Court of Appeal in King & Gardiner Farms, LLC v. County of Kern (2020) 45 Cal.App.5th 814, held that “[b]ecause the easement does not offset the loss of agricultural land (in whole or in part), the easement does not reduce a project’s impact on agricultural land.” The court then directed Kern County to set aside its 2015 approval and prepare a revised EIR should it choose to re-approve the ordinance. Kern County then prepared a supplemental recirculated EIR that eliminated ag easements altogether on the grounds that, because they cannot provide effective mitigation for the impact pursuant to the court’s ruling in King & Gardiner Farms, they are not required under CEQA. The trial court upheld the County’s determination, and petitioners appealed.

In disagreeing with the trial court, the appeals court in V Lions Farming repeatedly emphasized the “narrow aspect” of its holding in King & Gardiner Farms—that it previously was deciding only whether ag easements were effective mitigation for reducing a project’s “conversion of agricultural land to a less than significant level for the purpose of CEQA.” The court then addressed what it now deemed the “broader issue” of whether ag easements qualify at all as compensatory mitigation pursuant to criteria set forth in the state CEQA Guidelines. For this, the court looked at a variety of resources, including the state’s statutory definition of conservation easements, other CEQA appellate decisions on ag easements as mitigation, its 2020 King & Gardiner Farms opinion and its ambiguities, CEQA approaches to compensatory mitigation, federal approaches to compensatory mitigation, and legal principles for interpreting statutes and guidelines. The court concluded this sweeping inventory by focusing on CEQA Guidelines section 15370(e) definition of mitigation that, in relevant part, includes “[c]ompensating for the impact by … providing substitute resources or environments, including through permanent protection of such resources in the form of conservation easements.” By interpreting the word “providing” to mean preservation or permanent protection, and the phrase “substitute resources” to mean existing agricultural land, the use of ag easements as CEQA mitigation would be promoted, which, per the court, ultimately “would advance CEQA’s purpose of long-term protection of the environment and its specific role of preserving agricultural land.”

While acknowledging that its ruling in King & Gardiner Farms could have been clearer in some respects, the court determined that the “scope of the issue impliedly limited what the opinion meant” and its former holding that ag easements “do[] not offset the loss of agricultural land (in whole or in part)” and therefore “do[] not reduce a project’s impact on agricultural land” did not conflict with the current holding that ag easements “are a type of compensatory mitigation [under CEQA] for the conversion of agricultural [land] even though, operating by themselves, they do not replace the converted land or otherwise result in no net loss of agricultural land.”

This case has implications for any development in California that would convert agricultural land to another use and for parties looking to increase the conservation of agricultural land. Ag easements can be costly and challenging to establish. CEQA does not explicitly require them, though, as pointed out by the Fifth District Court of Appeal, it does require the implementation of feasible mitigation. Whether an ag easement constitutes feasible mitigation should be a factual determination left to the lead agency. Now, however, any decision to not require an ag easement comes with an increased risk of a successful CEQA challenge to that decision, bringing with it inevitable increases in costs associated with litigation and/or the provision of easements. At the same time as the burden on development increases, opportunities expand for farmers willing to allow ag easements on their land and for conservation land trusts and other similar organizations eager to increase their easement holdings.

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