BIA Bay Area Regional Regulatory Bulletin

  • by BPC Staff
  • on February 22, 2013
 BIA Reg. Regulatory Bulletin

Economy and Environment-San Jose Gets Balance Right

For more than a decade, the city of San Jose had been under increasing pressure from federal and state wildlife agencies to ratify and implement the Santa Clara Valley Habitat Conservation Plan, a $660 million program of land acquisition, habitat management and other measures to protect and preserve threatened plant and animal species in the Santa Clara Valley.Effectively the price of federal and state approval of a set of Highway 101 interchange improvements back in 2001, the drafting of the Habitat Conservation Plan has been a joint effort of the cities of San Jose, Morgan Hill and Gilroy, the county of Santa Clara, and the Santa Clara Valley Water District and Valley Transportation Agency.

By 2012, the pressure on San Jose to adopt the Plan was considerable—given that the other participating local governments had or signaled their intention to do so and given the authority the U.S. Department of Fish and Wildlife Service and California Department of Fish and Game over permitting of public infrastructure and private development projects in the Santa Clara Valley.

The path of least resistance would have been to uncritically approve the Habitat Plan, despite serious reservations about its effects on smart growth housing development in the city and across the Valley.

Fortunately, as the vote approached, San Jose Mayor Chuck Reed’s administration and the City Council majority took the time and effort to understand the legitimate concerns raised by BIA, and made resolution of the concerns a condition to moving forward with adoption.

Plan’s rationale

Federal and state wildlife agencies contend the Santa Clara Valley Habitat Conservation Plan (SCVHCP) will be a win-win for conservation and development.

Under the Plan, a 50-year program of habitat conservation activities would be funded by development fees within the 506-acre plan area, federal and state grants, other government revenues and private contributions.

The work would be carried out by and at the direction of an implementing agency to be established and governed by a board jointly appointed by the cities of San Jose, Morgan Hill, Gilroy, the county of Santa Clara and other participating local jurisdictions that later join.

In the view of the federal and wildlife agencies, the Habitat Plan will establish a consistent framework for project compliance with regulatory requirements related to biological and natural resources within Santa Clara Valley.

The cost to local government and the regulated community, they say, is outweighed by the time and money that will be saved through predictable and streamlined environmental review.

The agencies justify the scheme with a view that the cumulative impact of growth and development have degraded natural habitat throughout the Valley and put at risk 18 plant and animal species, among them the Burrowing Owl and the Bay Checkerspot butterfly.

However, if the promise of predictable and streamlined environmental review isn’t enough to convince other jurisdictions to join or otherwise participate in the Habitat Plan, the agencies have made it clear they are prepared to use a stick where the carrot doesn’t suffice.

In a Nov. 13, 2012, joint letter to city planners throughout Santa Clara and Southern Alameda counties, regional leaders of U.S. Fish and Wildlife and California Fish and Game were extraordinarily blunt.

“We expect that jurisdictions not directly participating in the SCVHCP will follow requirements in both state and federal law to implement comparable mitigation measures,” the agencies stated in the letter.

The message: Absent participation in the Habitat Plan, local governments cities risk project permit denials for failure to adequately mitigate contributions to the cumulative effects of development on Valley habitat—in particular, the serpentine soil plant species home to the Bay Checkerspot butterfly.

BIA advocacy

While BIA objects to these heavy handed tactics and disputes the core scientific assumptions underpinning the letter’s legal and regulatory assertions regarding the butterfly,  our longstanding position has been to support adoption of a SCVHCP, provided it appropriately balances economic development and environmental conservation and takes meaningful steps toward streamlining the overall environmental permit process.

Unfortunately, the Habitat Plan the wildlife agencies and environmental advocates were pushing fell far short of meeting those criteria.

Most notably, the Plan called for adopting a new development impact fee on infill and higher-density housing that was fundamentally inconsistent with the city’s and the region’s emphasis on smart-growth development patterns.

Specifically, SCVHCP-member jurisdictions would have been required to charge a new fee based on the number of car trips expected to be generated by new housing development, regardless of its type or location of the projects.

The agencies and advocates justified this by asserting that nitrogen emitted from the tailpipes of cars owned by residents blows miles away and eventually alters natural habitat in places like Coyote Ridge, home to the last core population of Bay Checkerspot.

Ironically, while embracing this version of the “butterfly effect,” they brushed off concerns the “urban intensification fee” would drive up the price of a smart growth, arguing that the fee was relatively small and ignoring its incremental contribution to the rising cumulative costs of infill, transit-oriented development in San Jose, throughout the South Bay and across our entire region.

While adding to development costs on the one hand, the Habitat Plan also under delivered on predictability and streamlining of environmental review.

It contained no assurances that other agencies, specifically the U.S. Army Corps of Engineers and Regional Water Quality Control Board, would be satisfied with the SCVHCP’s requirements for projects near and along shorelines, rivers and other waterways.

Likewise, while the Habitat Plan established a standard and framework for complying with most federal and state environmental regulation, it didn’t prevent local jurisdictions from adding additional requirements at the urging of local advocates.

Lastly, the potential remained for federal and state wildlife agencies to overlay critical habitat designations on areas already covered by the Habitat Plan.

Key amendments address most (not all) concerns

In contrast to the agencies and the advocates, San Jose Mayor Reed, the city’s Council majority and city staffers were attuned to these problems and had additional misgivings.

Last summer, Reed, with input from BIA, began to apply the brakes to council consideration of the Habitat Plan until a set of amendments could be prepared and vetted by both the regulated community and environmental advocates.

The results of his administration’s work proved acceptable to both sides, was presented to the Council on Jan. 22, and approved on a 10-1 vote.

The amendments called for a series of changes and commitments being added to the various implementing agreements and ordinances to be finally ratified by the participating cities and county.

Among them:

Participating local governments would be free to tap other revenue sources as a substitute for imposing the nitrogen deposition.  In San Jose, infill and transit-oriented projects in Downtown, North San Jose, Urban Village and Employment Lands would be exempt and the fee would be covered from existing city construction tax coffers.

All parties to the Plan would commit to getting the Army Corps and Regional Water Quality Control Board to also adopt the Habit Plan framework for issuing permits.

San Jose would draft expeditiously a local “no surprises” policy that could serve as a model, providing added certainty that cities and counties wouldn’t add new costs and regulations for habitat protection above and beyond what is included in the SCVHCP.

Additionally, the Reed administration wants to see the $660 million cost of the Habitat Plan spread more broadly—both geographically and across more activities than new housing construction.

BIA | Bay Area also supports additional measures to lessen the Plan’s overall reliance on home-building and to more equitably distribute the cost burden across all users of existing and future infrastructure improvements.  This issue will move front and center as efforts begin to push other jurisdictions to share the cost of conserving the Bay Checkerspot butterfly.  Again, while BIA Bay Area supports an equitable distribution of the regional costs of protecting the butterfly, we will strongly oppose any attempt to export the nitrogen fee concept to other cities as a method of “sharing the pain.”  If indeed the SCVHCP accurately assesses the cost of preserving the butterfly, funding should come from a broad-based subregional source or sources that captures existing and future residents and businesses.

BIA Bay Area supported moving forward with the SCVHCP as amended.  The modifications put forth by Mayor Reed greatly improved the document.  While it is not perfect and much work remains to be done with future implementation, a major bullet in the form of the nitrogen fee that was aimed at the very premise of smart growth has for now been averted.