The Center for Biological Diversity and California Native Plant Society filed a lawsuit challenging the environmental review for a development project on 12,323 acres on Los Angeles County’s border with Kern County. The project, which the petition called “a new, sprawl city,” would include 19,333 houses and 8.4 million square feet of commercial, industrial, and business park space. On June 26, 2025, the California Court of Appeals held that the environmental impact report (EIR) involved in the California Environmental Quality Act (CEQA) challenge to the County of Los Angeles’s approval of the 12,000-acre Centennial Specific Plan proposed by Tejon Ranchcorp (Tejon), was legally inadequate with respect to climate change impacts, specifically greenhouse gas emissions (GHGs) and wildfire risk. The court found that the County’s reliance on California’s cap-and-trade program to offset the Centennial project’s estimated unmitigated GHG emissions was prejudicially misleading and unlawful under the CEQA. The EIR claimed the project would emit approximately 157,642 metric tons of greenhouse gas emissions annually. After deeming these emissions “significant,” the County proposed to mitigate 96% of them through the purchase of cap-and-trade allowances. However, the court found this approach improper since, although the cap-and-trade program regulates certain sectors such as energy and fuel suppliers, the Centennial project itself was not a “covered entity” under the program. Relying on emissions reductions already required by law for other entities did not constitute valid CEQA mitigation. Further, the CEQA’s “additionality” requirement prohibits the leverage of emissions reductions that are already legally mandated for other entities to offset a project’s climate impacts. The court concluded that the County’s certification of the EIR violated CEQA due to improper reliance on the state’s cap-and-trade program to offset the project’s greenhouse gas emissions impacts. The Los Angeles County supervisors approved the 12,000-acre Centennial development in 2020. The Center and California Native Plant Society sued the county for failing to thoroughly analyze the environmental consequences of the project and violating the California Environmental Quality Act, or CEQA. A Los Angeles Superior Court judge sided with the environmentalists in 2021 but the developers appealed. Today’s decision affirms the lower court ruling. The ruling states that the law explicitly requires that climate, wildfire and other environmental harms must be fully factored in when building a risky project of this size. The court’s decision cautions developers against building poorly planned projects that put people’s lives at risk in fire-prone areas.
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