Fresno business and political leaders are getting a better sense of the impacts of an Aug. 6 court ruling against the city’s environmental assessment.

A list of projects sent to city leaders shows construction was halted on hundreds of homes and several businesses.

Even though the city of Fresno list acquired by GV Wire shows two dozen projects held up by the ruling, experts and politicians say this is only an initial list. The full scope of businesses impacted is only beginning to be understood.

The list contains three transportation projects, two storage facilities, an energy project, an apartment complex, two industrial businesses, an Amazon truck parking lot, nine residential tracts, and an entire subdivision.

But the California 5th Circuit Court of Appeals decision affects a wide variety of projects looking to be built. That could mean car washes to gas stations and especially affordable housing, said Dirk Poeschel, principal at Land Development Services.

“It’s essentially a moratorium,” Poeschel said.

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‘Public Has No Idea of the Real Consequences’

Fresno City Councilmember Miguel Arias said the tracts and subdivisions on the list equal hundreds of houses.

“My understanding is that they are still trying to assess what is the scope of the projects impacted,” Arias said.

The city may also have to spend an additional $330,000 to do an environmental study for the Tower District Specific Plan.

Fresno City Council Vice President Mike Karbassi said the impact of the judicial ruling is widespread.

“(The) public has no idea of the real consequences,” Karbassi said.

Half of Projects Initially Impacted Are Residential

In 2021, two community groups, South Fresno Community Alliance and Leadership Counsel for Justice and Accountability sued Fresno, saying its 2019 program environmental impact report did not adequately address traffic, pollution, and water problems.

The court of appeals agreed saying the PEIR was deficient.

“(The city) concluded ‘economic and social considerations outweighed the remaining environmental effects of approval and implementation of the project,’” the appellate opinion stated.

They gave the city six specific items it needs to fix. Those fixes could take months or years, depending on who is being asked. The court in its ruling said the city could get conditional approval for the PEIR by showing the court it has a plan to fix these shortcomings.

“We are evaluating the court’s ruling with our counsel to determine the next steps,” said Sontaya Rose, director of communications with the city.

Most new construction needs to have an environmental assessment. A car wash might need to show it won’t back up traffic. New home construction, in addition to potential impacts on undeveloped land, has to show that the people who will live there won’t significantly increase car pollution when they go to work or shop. Developers will have to find ways to mitigate what’s called vehicle miles traveled, or VMT.

For small business owners, doing an environmental study is costly and takes a long time. Environmental impact reports also expose projects to litigation for those studies.

To save time and money, businesses use — or tier off — a PEIR to understand what they have to do to comply with the state’s landmark California Environmental Quality Act.

Of the two dozen projects on the list, nine had industrial uses. More than half of the projects impacted were residential. One was an apartment complex.

“I think the unintended consequence sadly is that the very group that’s suing the city over this deficiency wants to have additional increased densities to help with greenhouse gas and traffic and service delivery costs, but those projects are also stopped because they also rely on this EIR,” Poeschel said.

Industrial/Commercial Projects Citing Fresno PEIR

• Papé Material EIR
• Willow/Nees Annexation
• Barstow Truck Repair
• Mini Storage
• NKRS Trucking
• Unifirst — Industrial Laundry
• Amazon Truck Parking
• McKinley/Fine Rezone
• RVJ Green Energy
• Central Transportation
• Darrel’s Mini Storage

Residential Projects Citing Fresno PEIR

• Los Pueblos Apartments
• Sierra Racquet Subdivision
• Bella Vita (Commercial/Residential)
• Tract 6468
• Tract 6352
• Tract 6411
• Tract 6440
• Tract 6441
• Tract 6432
• Tract 6472
• Tract 6475
• Tract 6376

Projects Should Have to Do Their Own EIRs: Arias

Arias said every project with big enough impacts should have to do its own full environmental study. Getting a memo saying more studies have to be done is a consequence of tiering off of the city’s environmental assessment.

“Any project that’s of significant impact, in both vehicle and truck and pollution impacts has always been required to complete a full environmental study,” Arias said. “And when they follow the simple state law of CEQA, then they’re approved and they overcome any legal challenges or opposition.”

He brought up the north Fresno Costco and south Fresno Scannell warehouse project as examples, both of which did their own EIRs. The Scannell project was nearly denied after union groups used the EIR to try to get the company to sign a Project Labor Agreement.

Most major industrial projects have to do their own EIRs.

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Arias said, however, that the city encouraged businesses to use the PEIR.

“A lot of applicants were misguided by the city’s suggestion to skip a full environmental study and simply tier off our PEIR,” Arias said. “And those individuals and applicants did spend a significant amount of resources following the city’s direction.”

Homebuilders Rely on City PEIR to Understand Impacts

For homebuilders, PEIRs provide reference points for the necessary greenhouse gas and traffic studies, said Darren Rose, president and CEO of the Building Industry Association of Fresno Madera Counties.

An EIR can cost over $100,000 for an impact analysis, he said. And those costs get baked into the cost of homes. In the long term, problems like these push builders away from the city. Cities such as Sanger, Madera, and Clovis have become popular for builders.

“With each new headwind, with each new challenge it becomes increasingly difficult and all that does is add cost and delay time,” Rose said.

The delay affects everything in the planning and development stages, Rose said.

Rose expects it to be at least a year to fix the PEIR to comply with the appellate decision. That will take additional city staff time probably not budgeted.

The industry has worked very closely with the city to move forward on the homes being delayed. Each project will most likely have to develop its own plan to move forward.

Each project has a different environmental deficiency, be it traffic or greenhouse gas, Poeschel said. Short of waiting for the city to fix its PEIR, a project developer may be able to pay for a limited study on a specific topic, he said.

“Whatever the solution is, because the city’s the lead agency, they have to tell us (developers) what the solution is going to be,” Poeschel said.

City Projects Also Set Back

Arias questioned the merits of even having a PEIR.

The Southwest Fresno Specific Plan — outlining land use in that part of town — had its own EIR, he said. Projects within that area can cite that EIR, he said.

The city’s nearly $1 million Tower District Specific Plan may cost an additional $330,000 for an environmental review.

Fresno City Council President Annalisa Perea, whose district encompasses Tower District, said in the Sept. 26 council meeting this sets the project back.

“We have to do an EIR. We have to start from scratch to some degree, currently at the cost of $330,000 which we do not have,” Perea said.

A large city park on Peach Avenue in southeast Fresno also is delayed because of the PEIR decision, according to Karbassi.

He said the delays will be costly in potential lost jobs and higher home prices.

“I think it’s unfortunate for Fresno’s working families that some special interests have effectively created a moratorium on new housing and parks projects in the entire City of Fresno, all in the name of social justice,” Karbassi said. “There is nothing just about killing jobs and driving up housing prices and rents. We will be feeling the repercussions for years to come.”