Case No. H038550 (Monterey County Superior Court No.

M1 05019) COURT OF APPEAL OF THE STATE OF CALIFORNIA SIXTH APPELLATE DISTRICT

MARINA COAST WATER DISTRICT,
Respondent/Appellant,

v.
AG LAND TRUST,
Petitioner/Respondent.

On Appeal from the Judgment of the Monterey County Superior Court, No. M105019 Honorable Lydia M. Villarreal, Judge

RESPONDENT'S BRIEF

MICHAEL W. STAMP (72785) MOLLY ERICKSON (253198) LAW OFFICES OF MICHAEL W. STAMP 4 79 Pacific Street, Suite One Monterey, CA 93940 Telephone: (831) 373-1214 Email: Stamp@stamplaw.us Erickson@stamplaw.us
Attorneys for Respondent AG LAND TRUST

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Case No. H038550 (Monterey County Superior Court No. M105019) COURT OF APPEAL OF THE STATE OF CALIFORNIA SIXTH APPELLATE DISTRICT

MARINA COAST WATER DISTRICT,

Respondent/Appellant,

v.
AG LAND TRUST,

Petitioner/Respondent.

On Appeal from the Judgment of the Monterey County Superior Court, No. M1 05019 Honorable Lydia M. Villarreal, Judge

RESPONDENT'S BRIEF

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TO BE FILED IN

APP-008

CERTIFICATE OF INTERESTED ENTITIES OR PERSONS

Notice: Please read rules 8.208 and 8.488 before completing form. You may use this form for the initial certificate an appeal when you file your brief or a prebriefing motion, application, or opposition to motion or application the Court of Appeal, and when you file a petition for an extraordinary writ. You this form a supplemental certificate when you learn of changed or additional information that must

1. This form is

submitted

2. a. [l]
b.

Full name of interested entity or person

Nature of interest (Explain):

The undersigned certifies thatthe above-listed persons or entities (corporations, partnerships,firms, or any other association, but not including government entities or their agencies) have either (1) an ownership interest of 10 percenfor more in the party if it is an entity; or (2) a financla I or other interest in the outcome oft he proceeding thatthe justices should consider in determining Whether to disqualify themselves, as defined in rule 8.208(e)(2).

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TABLE OF CONTENTS

INTRODUCTION ....................................... 1 STANDARD OF REVIEW ON APPEAL ...................... 8 STATEMENT OF FACTS ................................. 9 A. B. C. D. Marina Coast Water District Is a Local Public Agency . 9 The CPUC Regulates Private Corporations ........ 10 In 2008, Public Agencies Proposed a Public Project . 12 The 2009 Environmental Impact Report ........... 13 1. 2. FEIR Response to Comments ............. 14 Marina Coast Admitted the EIR Was Inadequate ............................ 16

STATEMENT OF THE CASE ............................. 19 ARGUMENT .......................................... 23 I. THE SUPERIOR COURT PROPERLY DETERMINED THAT MARINA COAST WAS THE LEAD AGENCY UNDER CEQA ................................... 23 THE SUPERIOR COURT PROPERLY DETERMINED THAT THE EIR IS LEGALLY INADEQUATE ............ 28 A. Water Rights ................................ 29 1. 2. 3. 4. CEQA Requires a Reasonable Analysis of Water Rights ........................... 29 The Basin Is in Overdraft ................. 30 The EIR Asserted that Water Rights Were Not an Environmental Issue ............... 31 Marina Coast's Argument on Appeal ........ 33

II.

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a.

The EIR Did Not Discuss Water Rights Now Asserted by Marina Coast ....... 34 The EIR Did Not Analyze the Deferral of Pumping ................ 36 The EIR Did Not Adequately Address the Amount of Pumping Required for the Project .......................... 38 Conclusion ....................... 40

b.

c.

d. B.

Six Other Substantive Defects in the EIR .......... 40 1. Lack of Contingency Plans and Impacts Thereof ............................... 41 Assumption of Continuous Groundwater Pumping .............................. 42 Prohibition on Exportation of Groundwater .... 43 Brine Impacts on Outfall Pipeline ........... 44 Impacts to Overlying and Adjacent Properties . 45 Violations of Anti-Degradation Policy and Basin Plan ......................... 46

2.

3. 4. 5. 6.

C.

Because the EIR Was Defective, a New EIR Was Required to be Prepared by Marina Coast as Lead Agency .................................... 46

Ill.

THE SUPERIOR COURT HAD JURISDICTION OVER THE CEQA CHALLENGE TO MARINA COASTS ACTIONS ... 49 A. Public Utilities Section 1759 Does Not Affect The Superior Court's Lawful Exercise of Jurisdiction in this Case ...................................... 49 The Superior Court Was Not Deprived of Jurisdiction by Public Utilities Code Section 1759, Subdivision (a) .............................. 51
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B.

C.

The Cases Relied on by Marina Coast Do Not Apply to Public Agencies Not Regulated by the CPUC ................................ 53 The CPUC's Position Is Not Material or Dispositive Here ............................. 55

D.

IV.

MARINA COAST'S REMAINING AFFIRMATIVE DEFENSES ARE WITHOUT MERIT .................. 58 A. Derivative Claims Relating to the CPUC Have No Merit ............................... 58 Ag Land Trust's Challenge to Resolution 2010-18 (Property Purchase) Is Not Separately Moot ....... 59 Ag Land Trust's Claims Were Ripe as to Resolution 2010-18 (Property Purchase) and 2010-20 (Project Approvals) . . . . . . . . . . . . . . . . . . . . ............. 60 1. 2. D. Resolution 2010-18 (Property Purchase) ..... 62 Resolution 2010-20 (Project Approvals) ...... 62

B.

C.

Ag Land Trust Exhausted Its Administrative Remedies .................................. 65 Ag Land Trust Did Not Fail to Join Indispensable Parties .................................... 65 1. 2. Statutory Requirements: CEQA ............ 66 Statutory Requirements: Code of Civil Procedure ............................. 67

E.

V.

THE SUPERIOR COURT PROPERLY DENIED MARINA COAST'S MOTION TO AUGMENT THE ADMINISTRATIVE RECORD ....................................... 68

CONCLUSION ........................................ 70

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TABLE OF AUTHORITIES

CASES
AmeriGas Propane, L.P. v. Landstar Ranger, Inc. (201 0) 184 Cai.App.4th 981 .............................. 48 Asociacion de Gente Unida por el Agua v. Central Valley Regional Water Quality Control Board (2012) 210 Cai.App.4th 1255 ...... 46 Bakersfield Citizens for Local Control v. City of Bakersfield (2004) 124 Cai.App.4th 1184 ............................. 59 California Veterinary Medical Assn. v. City of West Hollywood (2007) 152 Cai.App.4th 536 .............................. 56 Cedar Fair, L. P. v. City of Santa Clara (2011) 194 Cai.App.4th 1150 ............................. 62 Cherry Valley Pass Acres & Neighbors v. City of Beaumont (2010) 190 Cai.App.4th 316 .............................. 37 Citizens Task Force on Sohio v. Board of Harbor Commissioners of the Port of Long Beach (1979) 23 Cal.3d 812, 814 (Sohio) ............ 6-7, 23-28, 51, 57 City of Carmel-by-the-Sea v. Board of Supervisors (1986) 183 Cai.App.3d 229 ........................... 48-49 City of Pasadena v. City of Alhambra (1949) 33 Cal.2d 908 ..... 34 City of Sacramento v. State Water Resources Control Bd. (1992) 2 Cai.App.4th 960 ................................ 27 City of Santa Maria v. Adam (2012) 211 Cai.App.4th 266 ..... 9, 35 County of Imperial v. Superior Cowt of Sacramento County (2007) 152 Cai.App.4th 13 .......................... 9, 66-67 County of Orange v. Superior Court of Orange County (2003) 113 Cai.App.4th 1 ................................ 69

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Deltakeeper v. Oakdale Irrigation District (2001) 94 Cai.App.4th 1092 ........................... 67-68 Environmental Protection Information Center v. California Dept. of Forestry (2008) 44 Cal. 4th 459 ............................ 34 Federation of Hillside Canyon Assns. v. City of Los Angeles (2004) 126 Cai.App.4th 1180 .......................... 58-59 Friends of Cuyamaca Valley v. Lake Cuyamaca Recreation and Park District (1994) 28 Cai.App.4th 419 ................. 27 Galante Vineyards v. Monterey Peninsula Water Management District (1997) 60 Cai.App.4th 1109 ..................... 34, 39 Guardians of Turlock's Integrity v. Turlock City Council (1983) 149 Cai.App.3d 584 .............................. 48 Habitat and Watershed Caretakers v. City of Santa Cruz (2012) 211 Cai.App.4th 429 ............................... 8 Hartwell Corp. v. Superior Court of Ventura County (2002) 27 Cal.4th 256 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53-54 Katz v. Walkinshaw (1903) 141 Cal. 116 .................... 34 Kaiser Foundation Health Plan, Inc. v. Zingale (2002) 99 Cai.App.4th 1018 .............................. 56 Landry v. Berryessa Union School Dist. (1995) 39 Cai.App.4th 691 ............................... 48 Laurel Heights Improvement Assn. v. Regents of University of California (1988) 47 Cal.3d 376 ........................... 51 Los Angeles v. San Fernando (1975) 14 Cal.3d 199 ........... 30 Madera Oversight Coalition, Inc. v. County of Madera (2011) 199 Cai.App.4th 48 ............................... 68 MHC Operating Limited Partnership v. City of San Jose (2003) 106 Cai.App.4th 204 .............................. 66

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Mycogen Corp. v. Monsanto Co. (2002) 28 Cal.4th 888 . ....... 59 Onofrio v. Rice (1997) 55 Cai.App.4th 413 ................... 49

0. W.L. Foundation v. City of Rohnert Park (2008) 168 Cai.App.4th 568 . ............................. 39
Pacific Legal Foundation v. California Coastal Commission (1982) 33 Cal.3d 158 ................ . .......... . ....... 60 People ex rei. Orloff v. Pacific Bell (2003) 31 Cal. 4th 1132 . . . 54-56 PG&E Corporation v. Public Utilities Commission (2004) 118 Cai.App.4th 1174 ..... . ....................... 56 Planning and Conservation League v. Department of Water Resources (2000) 83 Cai.App.4th 892 ............. 25, 27, 46-47 Ross v. California Coastal Commission (2011) 199 Cai.App.4th 900 ................ . ............. 24 San Diego Gas & Electric Company v. Superior Court ( 1996) 13 Cal. 4th 893 (Covalt) .............. . ............. 53 Santa Clarita Organization for Planning v. County of Los Angeles (2003) 106 Cai.App.4th 715 ................ . .......... 29, 33 Santiago County Water Dist. v. County of Orange (1981) 118 Cai.App.3d 818 .................... . ..... . ............. 34 Sarale v. Pacific Gas and Electric Co. (201 0) 189 Cai.App.4th 225 ............................ . . 57 Save Our Peninsula Committee v. County of Monterey (2001) 87 Cai.App.4th 99 ....... . . . . . .. .... .. . ... 8, 10, 29, 51 Save Tara v. City of West Hollywood (2008) 45 Cal.4th 116 ..... 64 Save the Sunset Strip Coalition v. City of W Hollywood (2001) 87 Cai.App.4th 1172 .......... . ................... 48 Simpson Strong-Tie Co., Inc. v. Gore (2010) 49 Cal.4th 12 ...... 70

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Sunnyvale West Neighborhood Association v. City of Sunnyvale City Council (201 0) 190 Cai.App.4th 1351 .................... 8, 28 The Flanders Foundation v. City of Carmel-by-the-Sea (2012) 202 Cai.App.4th 603 ........................... 33, 38 Uriarte v. United States Pipe & Foundry Co. (1996) 51 Cai.App.4th 780 .............................. 8-9 Vineyard Area Citizens for Responsible Growth v. City of Rancho Cordova (2007) 40 Cal.4th 412 . . . . . . . . . . . . . . . . . . 28-30, 35, 40 Warburton/Buttner v. Superior Court (2002) 103 Cai.App.4th 1170 . 9 Western States Petroleum Association v. Superior Court (1995) 9 Cal.4th 559 .................................... 68 Woodward Park Homeowners Association v. Garreks, Inc. (2000) 77 Cai.App.4th 880 ............................... 60 CONSTITUTION California Constitution, article XII, section 3 ................ 3, 10 STATUTES Code of Civil Procedure section 389 ....................... 67 Code of Civil Procedure section 632 ....................... 48 Code of Civil Procedure section 1094.5 ..................... 68 Public Resources Code section 21000 et seq .................. 1 Public Resources Code section 21005, subdivision (c) ......... 47 Public Resources Code section 21 067 . . . . . . . . . . . . . . . . ...... 23 Public Resources Code section 21152, subdivision (a) .... 2, 17, 61 Public Resources Code section 21167, subdivision (a) ......... 61 Public Resources Code section 21167, subdivision (b) ...... 17, 61
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Public Resources Code section 21167, subdivision (c) ......... 61 Public Resources Code section 21167.6 ................. 69-70 Public Resources Code section 21167.6.5 ................ 66, 67 Public Resources Code section 21168.5 ..................... 8 Public Utilities Code section 1759 . . . . . . . . . . . . . . . . 49-50, 53-57 Public Utilities Code section 2106 ......................... 53 COURT RULES Cal. Rules of Court, rule 8.204(a)(1 )(C) .................. 50, 68 OTHER AUTHORITIES CEQA Guidelines section 15050 .......................... 25 CEQA Guidelines section 15051 ..................... 2, 28, 52 CEQA Guidelines section 15051, subdivision (a) ..... 23, 24, 26, 53 CEQA Guidelines section 15051, subdivision (b) ..... 11, 24, 26, 52 CEQA Guidelines section 15051, subdivision (d) .............. 25 CEQA Guidelines section 15065 (former section 15051 ), subdivision (c) ...................................... 24-25 CEQA Guidelines section 15082 .......................... 11 CEQA Guidelines section 15088, subdivision (c) .............. 33 CEQA Guidelines section 15091 .......................... 18 CEQA Guidelines section 15093 .......................... 18 CEQA Guidelines section 15097 .......................... 18 CEQA Guidelines section 15144 .................... 32, 40,46

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CEQA Guidelines section 15151 .................... 40, 43, 46 CEQA Guidelines section 15200 .......................... 43 CEQA Guidelines section 15204 .......................... 43 CEQA Guidelines section 15352, subdivision (a) .............. 61

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INTRODUCTION Respondent Ag Land Trust, a nonprofit public benefit corporation, sued Marina Coast Water District, a local public agency, for failure to comply with the California Environmental Quality Act ("CEQA," Pub. Resources Code, § 21000 et seq.). The superior court found that Marina Coast was the lead agency. The superior court also found that Marina Coast in March 2010 and Apri1201 0 approved a desalination project in reliance on an EIR that did not comply with CEQA. The superior court ordered Marina Coast to vacate its approvals and prepare a legally adequate EIR. Factual Summary On March 16, 201 0, the Marina Coast Water District approved the purchase and annexation of approximately 224 acres of property north of Marina. (4ROP 1 1726-1824.) The property was the site for Marina Coast's proposed desalination plant and appurtenant facilities to be owned by Marina Coast and other public agencies. (4ROP 1730.) In approving the purchase, Marina Coast relied on an EIR previously prepared by the California Public Utilities Commission (CPUC) (4ROP 1728-1732). Marina Coast filed a Notice of

"ROP" preceded by a number refers to the volume and page of the Record of Proceedings (administrative record). "AA'' refers to the Appellant's Appendix. "RT" preceded by a Roman numeral refers to a volume and page of the Reporter's Transcript.
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Determination under CEQA (2ROP 1083-1085; Pub. Resources Code, § 21152, subd. (a)). Ag Land Trust filed suit under CEQA. (1AA 1-20.) On April 5, 2010, Marina Coast formally approved the desalination project and facilities. (1 ROP 1-264.) The desalination plant and most of the facilities were to be constructed, owned and operated by Marina Coast. (1ROP 13-16.) Marina Coast made final CEQA approvals and adopted CEQA findings and a statement of overriding considerations. (1 ROP 5-6.) The April 5, 2010 action by Marina Coast relied on the same EIR as its March 16, 2010 action. (1ROP 4, 6.) Marina Coast was the first public agency to approve a project in reliance on the EIR. Marina Coast was the first public agency to approve the desalination project. (22AA 5512.) Ag Land Trust appeared at Marina Coast's March and April hearings. Ag Land Trust pointed out that because Marina Coast's desalination project would be carried out by Marina Coast, Marina Coast was the lead agency for the project under CEQA Guidelines2 section 15051 and Supreme Court precedent. Ag Land Trust submitted detailed documentation of EIR flaws, and attached

California Code of Regulations, title 14, hereafter "CEQA Guidelines."
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evidence supporting its allegations. (3ROP 11 06-1725; 2ROP 5951021 [letters]; 1ROP 554, 4ROP 1922 [minutes].) Procedural Summary On April6, 2010, Ag Land Trust filed its First Amended Petition against Marina Coast under CEQA. Ag Land Trust alleged that Marina Coast violated CEQA in several significant ways. (1AA 21-41.) Marina Coast argued in response that Marina Coast was not the lead agency for the Marina Coast desalination plant, and that Marina Coast could not be responsible for the EIR. (3AA 517-535.) Marina Coast argued that the CPUC was responsible for defending the EIR (3AA 517-521 ), even though the CPUC had not approved Marina Coast's project. And the CPUC could not approve Marina Coast's project, because the CPUC has authority only over private corporations, and not over public agencies such as Marina Coast. (Cal. Canst., art. XII, § 3.) As the EIR said, "As a municipally owned utility, the MCWD [Marina Coast] is not subject to the CPUC's jurisdiction" (9ROP 4536, fn. 2), and "the CPUC would not have authority over any element ... undertaken by the MCWD" (9ROP 4532). Relying on the argument that it was not responsible for the EIR, Marina Coast demurred to the CEQA petition and asserted that 3

the superior court lacked jurisdiction over the lawsuit. (2AA 313335.) The superior court overruled the demurrer. (3AA 539.) This Court denied a subsequent writ petition filed by Marina Coast. (Case no. H036084.) The Supreme Court denied Marina Coast's petition for review. (Case no. 8192285.) Again relying on the argument that the superior court lacked jurisdiction, Marina Coast filed a motion for summary judgment and/or adjudication. (4AA 997 to 5AA 1075.) The superior court denied the motion. (18AA 4447-4451.) In October 2011, the superior court heard oral argument on the CEQA petition. Marina Coast again argued that the superior court lacked jurisdiction and argued, for the first time, that the EIR was adequate. (IX-RT 2440-2444, 2449-2452, 2464-2498.) In December 2011, the superior court issued an intended decision. (21AA 5362-5384.) After further briefing, the court issued an amended intended decision. (22AA 5406-5440.) The court found that Marina Coast was the lead agency for the desalination project, and that the EIR was defective in each of the seven ways briefed by Ag Land Trust. (22AA 5424-5425, 5435.) The court also determined that Marina Coast's arguments as to jurisdiction were not meritorious. (22AA 5437-5438.)

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Before a judgment could be entered and the peremptory writ issued, Marina Coast filed another writ petition in this Court. The writ petition claimed that the superior court lacked jurisdiction. (Case no. H038167.) This Court denied the writ petition. The Supreme Court denied the petition for review. (Case no. S204634 ). On April17, 2012, judgment was entered (22AA 5487-5528) and the writ issued (22AA 5529-5531 ). Summary of This Appeal On appeal, Marina Coast raises the same jurisdiction argument it raised in the superior court and raised twice before in this Court and in the Supreme Court. Marina Coast devotes most of its factual recitation to CPUC actions (Opening Brief of Appellant Marina Coast Water District (AOB) 1-21 ), and another twenty pages arguing that the superior court did not have jurisdiction (AOB 26-45). This effort is an attempt to misdirect the focus from Marina Coast and Marina Coast's public project- to the CPUC. The proper focus of the case is the action of Marina Coast, a local public agency that is subject to superior court jurisdiction, and that is not subject to CPUC regulation. The CPUC does not regulate public agencies, including Marina Coast. It is undisputed that the CPUC has no authority over Marina Coast or over Marina Coast projects. Marina Coast and the

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EIR admit that fact. (2AA 934 [1f15, admitting ~15 of petition (1AA 25); 9ROP 4536, fn. 2.) The CPUC did not- and could not- order Marina Coast to proceed or to rely upon any environmental documents. Marina Coast's actions were the decisions of Marina Coast, not of anyone else. Marina Coast's argument is based on a flawed premise: that because the CPUC prepared the EIR, the CPUC must defend the EIR and the superior court has no jurisdiction. That is not the law. In

Citizens Task Force on Sohio v. Board of Harbor Commissioners of the Port of Long Beach (1979) 23 Cal. 3d 812, 814 (Sohio), two
agencies - a local public agency and the CPUC -jointly prepared an EIR for a nongovernmental project proposed by a private corporation subject to CPUC jurisdiction. The California Supreme Court held that when the local agency acts first to approve a project, the local public agency (the Port of Long Beach in Sohio, Marina Coast in this case) is the lead agency and the local public agency must defend the EIR. Sohio is on point. The facts here are even more favorable to superior court jurisdiction than those in Sohio, because unlike the private project at issue in Sohio, the CPUC never had jurisdiction over Marina Coast, or the Marina Coast desalination plant, or the appurtenant facilities that were to be owned and operated by Marina Coast and other

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public agencies. As the superior court determined, Marina Coast was the lead agency for this Marina Coast project, and Marina Coast is responsible for the EIR. (22AA 5512-5513, 5522-5523.) "Because the [local agency] was the first to act ... , it became the lead agency and hence was required to defend the adequacy of the entire EIR [in the superior court] under Public Resources Code section 21167."

(Sohio, supra, 23 Cal.3d 812, 814.)
Marina Coast argues that the EIR is adequate as to one of the seven EIR defects found by the superior court: the analysis of water rights (AOB 45-50). As to the other six defects, Marina Coast presents no argument, but merely cites to the transcript of its oral argument below (AOB 51, fns. 189-195). Marina Coast presents several affirmative defenses, most of which rely on the argument that the CPUC is responsible for defending the EIR (AOB 31-39). Marina Coast argues that the administrative record below should have been augmented with two documents. (AOB 52.) Conclusion The superior court correctly decided the case in favor of Ag Land Trust. The judgment should be affirmed.

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STANDARD OF REVIEW ON APPEAL Judicial review of an agency's decision to approve a project extends only to whether there was a prejudicial abuse of discretion. Abuse of discretion is established if the agency has not proceeded in a manner required by law or if the decision is not supported by substantial evidence. (Pub. Resources Code, § 21168.5; Save Our

Peninsula Committee v. County of Monterey (2001) 87 Cai.App.4th
99, 117 (Save Our Peninsula); Habitat and Watershed Caretakers v.

City of Santa Cruz (2012) 211 Cai.App.4th 429, 438 (Habitat).) The
failure to comply with the law subverts the purposes of CEQA if it omits material information. In such cases, the error is prejudicial.

(Sunnyvale West Neighborhood Association v. City of Sunnyvale City Council (2010) 190 Cai.App.4th 1351, 1392 (Sunnyvale West); Habitat, supra, 211 Cai.App.4th 429, 438.)
This Court reviews Marina Coast's CEQA actions de novo.

(Sunnyvale West, supra, 190 Cai.App.4th 1351, 1371-1372.) That
does not make the superior court's decision irrelevant. (Uriarte v.

United States Pipe & Foundry Co. (1996) 51 Cai.App.4th 780, 791
["The fact that we review de novo a grant of summary judgment does not mean that the superior court is a potted plant in that process"].) The determination of subject matter jurisdiction is subject to de novo review. (Warburton/Buttner v. Superior Court (2002) 103

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Cai.App.4th 1170, 1180.) Where the challenge is to the sufficiency of the evidence, the appellate courts defer to the superior court, and the substantial evidence test is used if the facts are disputed. (City of Santa Maria v. Adam (2012) 211 Cai.App.4th 266, 286.) The court reviews an indispensable party question for an abuse of discretion. (County of Imperial v. Superior Court of Sacramento County (2007) 152 Cai.App.4th 13, 25 ("County of lmperiaf').) STATEMENT OF FACTS
A. MARINA COAST WATER DISTRICT IS A LOCAL PUBLIC AGENCY.

Marina Coast Water District is a local public agency. (AOB 1, 1ROP 1) Marina Coast pumps groundwater from the Salinas Valley Groundwater Basin and provides that water to the City of Marina and the former Fort Ord. (1 ROP 1.) Marina Coast's service area is located north of the Monterey Peninsula. (1ROP 216, 501; 4ROP 2133.) As a public agency, Marina Coast is not subject to the jurisdiction of the California Public Utilities Commission (CPUC). (1 ROP 8; 9ROP 4532; see Cal. Canst., art. XII,§ 3.)

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8.

THE CPUC REGULATES PRIVATE CORPORATIONS.

The CPUC has regulatory authority over private corporations that provide utilities within California. (Cal. Const., art. XII, § 3.) California American Water Company (CaiAm) is a private corporation that delivers water. It is a "public utility" subject to CPUC jurisdiction. (1 ROP 2.) CaiAm provides water to the Monterey Peninsula. (1 ROP 2, 218.) CaiAm gets water from two sources: the Carmel River and the Seaside Basin. (4ROP 2062-2063.) CaiAm has been illegally diverting water from the Carmel River without a legal right, causing environmental harm. (4ROP 2051.) In 1995, the State Water Resources Control Board ordered CaiAm to find another water source. (Save Our Peninsula, supra, 87 Cai.App.4th 99, 108.) The Seaside Basin recently was adjudicated. (4ROP 2063.) In 1998, Assembly Bill 1182 directed the CPUC to prepare a plan alternative to a proposed CaiAm dam (4ROP 2055-2056). That direction was satisfied when in 2002 the "Plan B" report was issued recommending a desalination plant at Moss Landing. (4ROP 2051; 6ROP 3039.) In February 2003, CaiAm applied to the CPUC for a "certificate of public convenience and necessity" for a CaiAm desalination plant in Moss Landing, or for an alternative site north of Marina.
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(2ROP 937-945.) The CaiAm proposals to the CPUC were called the "Coastal Water Project." (2ROP 937; 4ROP 1992.) In September 2003, the CPUC determined that it would be the lead agency under CEQA on the two CaiAm proposals (14ROP 7676). The CPUC stated that it met the criteria for lead agency where a project is proposed by a nongovernmental entity such as CaiAm: Under CEQA, where a project is to be carried out by nongovernmental entities, the lead agency will normally be the public agency with the greatest responsibility for supervising or approving the project as a whole. (14ROP 7693; see 7670-7671, 7676, discussing CEQA Guidelines,

§ 15051, subd. (b).) The bulk of the CPUC decision was devoted to
ratemaking issues involving the costs and rates to be charged to CaiAm's customers (14ROP 7679-7695). In September 2006, the CPUC released a Notice of Preparation of an EIR for the two CaiAm projects. (2ROP 937; see CEQA Guidelines, § 15082.) The CPUC has acknowledged that the EIR was to be the first water supply project EIR ever to be prepared by the CPUC. (2ROP 1104.)

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C.

IN

2008, PUBLIC AGENCIES PROPOSED A PUBLIC PROJECT.

In June 2008, Marina Coast and two other local public agencies jointly proposed a public project as an alternative to the nongovernmental projects proposed by CaiAm. (4ROP 1994.) None of the three public agencies is subject to CPUC authority. The "Regional Project" facilities were to be carried out and owned by the three public agencies: 1. Marina Coast was to construct and own: the desalination plant; a pipeline for source water; a brine return pipeline; a pipeline for desalinated water; operations building, electrical building, and chemical buildings; laboratory facilities; parking lot; and access roads. (1 ROP 13-16.) Marina Coast was to use some of the desalinated water to supply Marina and development in Fort Ord (4ROP 201 0), and was to sell additional desalinated water (1 ROP 2, 12, 142). Marina Coast was to purchase capacity in outfall facilities for disposal of brine. (1 ROP 16.) 2. Monterey County Water Resources Agency was to construct the source water intake wells and a pipeline from the wells to Marina Coast's pipeline. (1ROP 1213.)
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3.

Monterey Regional Water Pollution Control Agency was to construct a brine receiving facility, and was to sell capacity in its outfall facilities to Marina Coast for brine disposal. (1 ROP 16.)

CaiAm was to be a secondary participant in the Regional Project. (1 ROP 16-17.) CaiAm was to construct a distribution system to take some of Marina Coast's desalinated water (1 ROP 16, 4ROP 2009) and deliver that water to CaiAm customers on the Monterey Peninsula (1ROP 16-17). The source water for the desalination project was the 180-foot aquifer near the coast. (1 ROP 12; 9ROP 4555.) The aquifer has suffered significant seawater intrusion. (2ROP 755, 759; 4ROP 2263 [map]; 5ROP 2684.) D.
THE

2009 ENVIRONMENTAL IMPACT REPORT.

On January 30, 2009, the CPUC released a draft EIR that addressed the two CaiAm projects and the recently added Regional Project. (4ROP 1966.) On August 10, 2009, at the request of Marina Coast, the CPUC agreed to bifurcate the certification of the EIR from any CPUC action on a project. (4ROP 1944.) In October 2009, the CPUC released a Final EIR (FEIR) on the two CaiAm projects and the Regional Project. (4ROP 1965.) For

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the Regional Project, the FEIR stated that Marina Coast "would own and operate desalination facilities," have "primary responsibilities related to water supply, project implementation, and agency coordination," and would "initiate contact with" and "be responsible for coordinating" with other public agencies. (9ROP 4592; see 4ROP 2009 [MCWD will be "Project Sponsor of the desalination facility"].)

1.:.

FEIR Response to Comments.

In response to public comments expressing confusion over the lead agency for the Regional Project, the FEIR stated: [T]he regional desalination facility would be owned and operated by the Marina Coast Water District ("MCWD") . . . . As a municipally owned utility, the MCWD is not subject to the CPUC's jurisdiction. (9ROP 4536, fn. 2.) If MCWD ... were to own and operate the desalination plant and/or the wells ... , the CPUC would not have jurisdiction over the components. (9ROP 4534, fn. 6.) If the ... Regional Project is selected, the MCWD, as owner and operator of the desalination plant, would approve the plant itself (and any associated facilities that it

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would own) and would apply the EIR to that decision .... (9ROP 4537.) The FEIR discussed the CPUC's authority over "public utilities" (9ROP 4531-4538) which are defined as private corporations that own, operate, control or manage a system for the production or furnishing of water (9ROP 4531 ). CaiAm is a public utility. (Ibid.) The FEIR pointed out as follows: Significantly, the CPUC does not have jurisdiction over municipally-owned utilities unless expressly provided by statute .... Marina Coast Water District ("MCWD") is a municipally-owned utility . . . . The CPUC has no jurisdiction over the MCWD. Thus, as discussed below, the CPUC would not have authority over any element of the CWP [Coastal Water Project] that ultimately is undertaken by the MCWD (. . . as is projected for the Regional Project). (9ROP 4532, emphasis added.) The CPUC acknowledged that it had no power to require Marina Coast to approve or disapprove any or all of the Project or the EIR: Thus, for the Regional Project, the CPUC would have jurisdiction over CaiAm's portion, but not MCWD's [Marina Coast's].

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(9ROP 4535.) [T]he CPUC will neither consider adoption of the Regional Project in its entirety nor consider adoption of all projects composing the ... Regional Project. (9ROP 4538.) If the California Public Utilities Commission (CPUC) approves a project, local agencies would then begin the process of local permitting and approvals. (9ROP 4583.) On December 17, 2009, the CPUC certified the FEIR. (4ROP 1941.) The CPUC stated that its action was necessary "before determining whether to approve CaiAm's request for a CPCN [Certificate of Public Convenience and Necessity]" for one of the CaiAm projects. (4ROP 1961.) 2. Marina Coast Admitted the EIR Was Inadequate.

Before the CPUC certified the EIR, the Regional Project proponents, including Marina Coast, had already determined that the EIR was inadequate as to specific known environmental impacts of the Regional Project, including brine disposal. (3ROP 1172-1174 [Nov. 2009 memo].) Marina Coast asked the Monterey Peninsula Water Pollution Control Agency to perform further environmental

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review of brine disposal (3ROP 1172, 1176, 1178) with regard to capacity and corrosion impacts (14AA 3410 [ROP 8167]). On March 4, 2010, a report stated that the brine would have significant corrosion impacts on the outfall (14AA 3430 [ROP 8187]). On March 16, 201 0, Marina Coast approved the purchase and annexation of Armstrong Ranch property for Marina Coast's construction of the Regional Project desalination plant. (4ROP 17261824.) For its approvals, Marina Coast relied on the EIR, as well as an EIR addendum prepared by Marina Coast. (4ROP 1825-1826, 1883.) On March 17, 2010, Marina Coast filed a Notice of Determination under CEQA regarding Marina Coast's approvals. (2ROP 1083-1085.) A Notice of Determination is formal notice that an agency has decided to carry out or approve a specific project. (Pub. Resources Code, § 21152, subd. (a).) The filing of the notice starts a 30-day statute of limitations on court challenges to the project approval under CEQA. (Pub. Resources Code,§ 21167, subd. (b).) On April 5, 2010, also in reliance on the EIR, Marina Coast formally approved the Regional Project as a whole, including the Marina Coast desalination plant. (1 ROP 1-264.) Marina Coast adopted Resolution 201 0-20 (1ROP 1-7) as "final" project approval 17
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(1 ROP 3 [§8.1 0]). Resolution 2010-20 stated unconditionally as follows: NOW THEREFORE, BE IT RESOLVED, that .... 2. The Directors hereby approve and adopt the [CEQA] Findings ... , pursuant to CEQA .... 3. The Directors hereby approve and adopt the Mitigation Monitoring and Reporting Plan .... pursuant to CEQA .... (1ROP 6.) Resolution 2010-20 approved: • 78 pages of CEQA findings (1 ROP 8-85; see CEQA Guidelines, § 15091 ). • CEQA statement of overriding considerations (1 ROP 85-86; see CEQA Guidelines, § 15093). • CEQA mitigation monitoring chart ( 1ROP 88-115; see CEQA Guidelines, § 15097). (1 ROP 6 [items 1, 2, 3].) These actions were final project approvals under CEQA, as the superior court determined. (22AA 5511-5513.) Before Marina Coast acted, Ag Land Trust commented on the proposed approvals in detail, and pointed out that Marina Coast's actions would violate CEQA. (2ROP 595-1 021, 3ROP 11 06-1725 [letters]; 1ROP 554, 4ROP 1922 [minutes].)

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STATEMENT OF THE CASE On April 6, 2010, Ag Land Trust filed its first amended petition and complaint. (1AA 21-41.) The first amended petition challenged the independent and voluntary actions taken under CEQA by Marina Coast on March 16, 2010 and April 5, 2010. (1AA 30-33
[~~

26-34].)

The petition alleged that Marina Coast violated CEQA when Marina Coast approved the Regional Project, despite being informed that Marina Coast was the proper lead agency and that the EIR was materially inadequate due to informational omissions and other prejudicial errors under CEQA. (1AA 29-33.) On July 23, 2010, Marina Coast certified the record of proceedings. (1AA 180-182.) On August 6, 2010, the superior court set the briefing schedule on the merits of the CEQA petition for fall 2010. (2AA 302-303.) On August 13, 2010, Marina Coast demurred to the first amended petition, arguing that the superior court had no jurisdiction. (2AA 304-343.) On September 24, 2010, the court overruled the demurrer. (3AA 538-539.) On September 29, 2010, Marina Coast filed a petition for writ of mandate in this Court (case no. H036084), challenging the overruling of the demurrer. This Court did not grant the immediate stay or expedited consideration sought by Marina Coast.

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By October 29, 2010, the opening brief, opposition brief, and reply brief on the merits had been filed in superior court. (2AA 344409; 3AA 494-537, 544-579.) On April 6, 2011, this Court summarily denied the writ petition. Marina Coast sought Supreme Court review. In May 2011, the Supreme Court denied Marina Coast's petition for review (case no. 8192285). In June 2011, Marina Coast filed a motion for summary judgment and/or adjudication. (4AA 997 to 5AA 1075.) Marina Coast asserted 215 undisputed material facts. (5AA 1029-1075.) In August 2011, the court denied the motion. (17AA 4367-4365, see 18AA 4447-4452.) Also in June 2011, Marina Coast moved to augment the record with post-approval documents. (4AA 989-996.) On July 12, 2011, the superior court denied the motion (14AA 3600-3601) and on August 11, 2011, the court amended its ruling (15AA 3651-3652). On August 16, 2011, Monterey County Water Resources Agency (MCWRA) moved to consolidate this case with a superior court case filed February 14, 2011 by Ag Land Trust against MCWRA as a responsible agency. (16AA 3892-3948.) Marina Coast did not join or oppose the motion, but filed a response arguing that the upcoming October 2011 CEQA hearing in the Marina Coast

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case should not be moved. (18AA 4389-4394.) The case against MCWRA was not yet at issue. The court denied the consolidation motion (21AA 5354-5356), holding that consolidating at such a late stage would "substantially delay" the resolution of the Marina Coast case (21AA 5355, line 16). In June, August, and October 2011, the parties filed supplemental briefing on issues ordered by the court: brine disposal impacts (14AA 3377-3384, 3568-3578, 3595-3598); whether conflicts of interest voided the project approvals (17AA 4329-4336); and the significance of a lead agency finding (18AA 4494-4503). On October 27, 2011, the superior court held its law and motion hearing on the CEQA petition. (IX-RT 2401-2505.) On December 19, 2011, the superior court issued an intended decision in favor of Ag Land Trust. (21AA 5362-5383.) In January 2012, Marina Coast filed objections (22AA 5392-5403) and Ag Land Trust filed a request for clarification (21AA 5385-5390). On February 2, 2012, the Court issued an amended intended decision (22AA 54065440) which on February 29, 2012 became the court's final order (22AA 5482-5483). On April 12, 2012, Marina Coast filed its second writ petition in this Court (case no. H038167).

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On April17, 2012, the superior court entered its Judgment in favor of Ag Land Trust and against Marina Coast (22M 5487-5527), and issued a peremptory writ of mandate (22M 5529-5530). The court determined that Marina Coast failed to comply with CEQA by failing to proceed as a lead agency (22M 5488, 5512) and by approving the Regional Project in reliance on a legally inadequate EIR (22M 5523). The court determined that there were no valid issues of preemption, jurisdiction, or other claimed affirmative defenses. (22M 5524-5527.) The court determined that Marina Coast through its actions of March and April 2010 was the first to approve the Regional Project (22M 5512) and that if Ag Land Trust had not challenged the March 2010 approvals, then all CEQA challenges to the Regional Project would have been foreclosed (22M 5513). On June 11, 2012, Marina Coast filed its Notice of Appeal. (22M 5576-5577.) On August 2, 2012, this Court denied the second writ petition. On August 10, 2012, Marina Coast filed another petition for review in the Supreme Court (case no. S204634). On September 12, 2012, the Supreme Court denied the petition. In its statement of the case on appeal, Marina Coast inserts an argument to the effect that the "project cessation" does not moot the
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appeal. (AOB 19-21.) The argument is dependent upon a document that is not in the appellate record. Marina Coast's discussion of the Regional Project's cessation does not raise an appellate claim of error. Therefore, Ag Land Trust does not address the issue further in Respondent's Brief.
ARGUMENT

I.
THE SUPERIOR COURT PROPERLY DETERMINED THAT MARINA COAST WAS THE LEAD AGENCY UNDER CEQA.

This lawsuit challenges Marina Coast's CEQA approvals of its project. (1AA 30-33, 37.) The superior court correctly determined that Marina Coast is the lead agency under CEQA for the Regional Project. (22AA 5496-5513; CEQA Guidelines, § 15051, subd. (a); Sohio, supra, 23 Cal.3d 812, 814.) The superior court had the jurisdiction to decide this case, and Marina Coast was required to defend its CEQA decisions. Public Resources Code section 21067 defines "lead agency" as the public agency with the principal responsibility for approving a project. CEQA Guidelines, section 15051, subdivision (a) directs that "If the project will be carried out by a public agency, that agency shall be the lead agency even if the project would be located within the jurisdiction of another public agency."

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Marina Coast was to construct and own the essential component of the Regional Project: the desalination plant. (1 ROP 13-16.) Marina Coast also was to construct and own the majority of the project facilities (ibid.) and have "primary responsibilities" related to water supply, project implementation, and agency coordination" (9ROP 4592). Because of its role in carrying out the Regional Project, Marina Coast was the lead agency under CEQA Guidelines section 15051, subdivision (a). In some cases, two or more public agencies may qualify as lead agencies. If so, the agency that acts first to approve the project is the lead agency. (Sohio, supra, 23 Cal.3d 812, 814; Ross v.

California Coastal Commission (2011) 199 Cai.App.4th 900, 940,
citing Sohio, supra.) Sohio is the leading Supreme Court decision on lead agency under CEQA, where the CPUC and a local agency are involved. It is controlling here. In Sohio, the EIR was for an interstate project proposed by a CPUC-regulated entity (see CEQA Guidelines, § 15051, subd. (b), which applies to projects proposed by nongovernmental entities).

Sohio applied subdivision (c) of CEQA Guidelines section 15065.
(Section 15065 was later renumbered as section 15051.) Subdivision (c) states that "where more than one public agency

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equally meet the criteria in subdivision (b), the agency which will act first on the project in question shall be the lead agency." 3 The Supreme Court in a per curiam opinion held that where the local public agency was the first to approve a project, it was the lead agency for purposes of CEQA and "hence was required to defend the adequacy of the entire EIR." (Sohio, supra, 23 Cal. 3d 812, 814.) The superior court therefore had jurisdiction over the CEQA petition that challenged the CEQA approvals by the Port, the local public agency. Sohio applies here, because it decided a similar set of issues and legal relationships, and is definitive in its holding.

Sohio shows that the local agency properly can be the sole
lead agency responsible for defending the entire EIR, even where the project is proposed by a CPUC-regulated entity, and even where the CPUC has jointly participated in the preparation of an EIR, which is a lead agency task (CEQA Guidelines, § 15050). Sohio is the only reported CEQA case discussing what happens when the CPUC and a local agency exercise lead agency duties (in Sohio, by jointly

Subdivision (d) of section 15051 states that where two or more agencies have a substantial claim to be lead agency under subdivisions (a), (b) and (c), "the public agencies may by agreement designate an agency as the lead agency." Here, there was no such agreement. In any event, an agreement cannot be used to designate an agency that does not qualify as lead agency. (Planning & Conservation League v. Department of Water Resources (2000) 83 Cai.App.4th 892, 906.)

3

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preparing an EIR), and the local agency then acts first to approve the project. Just as the Los Angeles Superior Court had jurisdiction to decide the CEQA issues in Sohio, the Monterey County Superior Court had jurisdiction to decide the CEQA issues in this case. Under CEQA Guidelines section 15051, subdivision (a), and consistent with Sohio, Marina Coast was the lead agency, and, as lead agency, "was required to defend the adequacy of the entire EIR." (Sohio, supra, 23 Cal.3d 812, 814.) Marina Coast does not establish that the superior court was deprived of jurisdiction over this CEQA action against the local public agency that acted first to approve the public project. Marina Coast argues that subdivision (b) of CEQA Guidelines section 15051 applies. (AOB 40, 42.) Subdivision (b) applies only where the project proponent is a nongovernmental entity. Subdivision (b) does not apply here because Marina Coast and its two co-proponents of the Regional Project were public agencies. Marina Coast argues for a general rule that local agencies should not be lead agencies in this type of case. In essence, Marina Coast asks the Court to rewrite section 15051. The three cases cited by Marina Coast (AOB 43-44) do not support Marina Coast.

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In Planning & Conservation League v. Department of Water

Resources (2000) 83 Cai.App.4th 892, 907 (PCL v. DWR), the
Department of Water Resources was the proper lead agency because it had principal responsibility for implementation of an agreement - the project at issue - that substantially restructured the distribution of State Water Project water throughout the state. In

Friends of Cuyamaca Valley v. Lake Cuyamaca Recreation and Park District (1994) 28 Cai.App.4th 419, 428-429, the State's ownership
interest of the key site in the case, Lake Cuyamaca, mandated its status as lead agency. Further, the state agency had the principal responsibility for the challenged activity- the duck hunting season. In City of Sacramento v. State Water Resources Control Bd. (1992) 2 Cai.App.4th 960, 973, the statutory scheme at issue established concomitant responsibility in two state agencies. Because one agency's environmental responsibilities were broader, that agency was in the better position to make such an assessment and should be the lead agency. (Ibid.) In each of these cases there was a statewide scheme or interest at issue and/or the project had direct impacts statewide, unlike the present case, where a local project was approved by a local water district. Any argument that the CPUC had extraordinary expertise (see PCL v. DWR, supra, 83 Cal App.4th 892, 904) due to

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its statewide perspective is weak because the CPUC had never before prepared an EIR on a water supply project (2ROP 1104, fn. 3). Here, as in Sohio, the agency that acted first to approve its project is the logical and legally appropriate lead agency under section 15051 of the CEQA Guidelines.

II.
THE SUPERIOR COURT PROPERLY DETERMINED THAT THE EIR IS LEGALLY INADEQUATE. The Court's principal task is to evaluate the adequacy of the EIR as an informational document. (Sunnyvale West, supra, 190 Cai.App.4th 1351, 1392.) The EIR must "clearly and coherently explain" the issue, "using material properly stated or incorporated in the EIR." (Vineyard Area Citizens for Responsible Growth v. City of

Rancho Cordova (2007) 40 Cal.4th 412, 421 (Vineyard).)
The superior court carefully considered the issue of water rights. (22AA 5514-5523.) The court determined that the EIR discussion of water rights did not comply with CEQA's informational mandates (22AA 5488, 5523) and there are six additional substantial and prejudicial defects in the EIR (22AA 5523).

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A.

WATER RIGHTS.

1..

CEQA Requires a Reasonable Analysis of Water Rights.

CEQA policies require that an EIR include sufficient detail to permit informed decisionmaking. An EIR that relies on uncertain sources of water must explain the uncertainty and explain any assumptions. (Santa Clarita Organization for Planning v. County of

Los Angeles (2003) 106 Cai.App.4th 715, 721-724 (SCOPE).)
CEQA requires the EIR to provide a detailed analysis of water rights issues, including ownership of those rights, when such rights reasonably affect the project's supply. Assumptions about supply are simply not enough. (Vineyard, supra, 40 Cal.4th 412, 431; Save

Our Peninsula, supra, 87 Cai.App.4th 99, 131-134, 143.)
Water rights lie at the heart of this desalination project. The illegal Carmel River overpumping and the Seaside Basin adjudication are repeatedly identified in the EIR as the rationale for the project. (E.g., 4ROP 1993.) The impacts of water uses, overpumping, basin overdraft, and the future of land uses in Monterey County are at stake, all amidst competing claims of water rights, or the lack of rights. Because the desalination project would require additional groundwater withdrawals in an overdrafted basin, and because the EIR failed to identify water rights for the additional

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pumping, or to disclose the uncertainty of "paper water" claims

(Vineyard, supra, 40 Cal.4th 412, 432) or to "clearly and coherently
explain" the issue (id. at p. 421 ), the EIR failed as an informational document. The EIR also ignored the apparent illegal taking of groundwater rights from the Salinas Valley landowners which would result from the project. 2. The Basin Is in Overdraft.

Overdraft is a physical condition that commences whenever extractions increase, or the withdrawable maximum decreases, or both, to the point where the amount of water being extracted from a basin causes adverse effects on the basin's supply. (Los Angeles v.

San Fernando (1975) 14 Cal.3d 199, 277-278.)
The Salinas Valley Groundwater Basin is in overdraft. (4ROP 2257, 2262; 9ROP 4946.) The overdraft has reduced groundwater levels and caused significant salt water intrusion in the coastal aquifers (2ROP 755, 789). Due to the overdraft, the State has threatened adjudication of the basin (2ROP 764-765). In response, the Monterey County Water Resources Agency approved the Salinas Valley Water Project, which was intended to stop and reverse seawater intrusion (7ROP 3796; see 2ROP 728.) The Salinas Valley Water Project EIR estimated basin overdraft to be 17,000 to 19,000 acre feet per year (AFY) for many

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years (2ROP 764, 789). The 17,000 to 19,000 AFY figure did not include seawater intrusion. (2ROP 764.) The Salinas Valley Water Project EIR said the overdraft had caused seawater intrusion to affect over 24,000 acres as of 1999 (2ROP 761 ), with intrusion advancing at the rate of 425 feet per year (2ROP 759). The Salinas Valley Water Project EIR admitted that the Salinas Valley Water Project would have only a "marginal ability ... to halt seawater intrusion (2ROP 780). In April 2010, the Salinas Valley Water Project was not operational (1 ROP 596, 4ROP 2053). 3. The EIR Asserted that Water Rights Were Not an Environmental Issue.

Numerous comments on the Draft EIR raised serious concerns about the lack of EIR discussion of water rights for the project. (8ROP 4125-4126, 4164-4165, 4413 [SVWC-1 0], 4415-4416 [TOMP-6].) In response, the FEIR stated that "water rights are not considered an environmental issue." (9ROP 4974.) The EIR did not identify any water rights claimed by Marina Coast. The FEIR admitted that if the groundwater basin in overdraft then Marina Coast would have only prescriptive rights in an amount "subject to proof' (9ROP 4 730). Instead of focusing on Marina Coast, the FEIR focused on CaiAm. The FEIR admitted that "CaiAm claims no rights to

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groundwater in the Salinas Valley" (9ROP 4778) and that "since CaiAm has no rights to the Salinas Valley groundwater, it must enter into an agreement with MCWRA [Monterey County Water Resources Agency] for use of the water. This contractual agreement is assumed in the Draft EIR." (9ROP 4591.) The EIR failed to use its best efforts to investigate or to disclose the fact that MCWRA does not have groundwater rights that it could assign to CaiAm. (Guidelines,§ 15144 [EIR preparer "must use its best efforts to find out and disclose all it reasonably can"].) MCWRA admitted it does not have water rights that could be used for the Regional Project. (2ROP 817.) In its response to comments, the FEIR mostly brushed off questions on water rights. To a question seeking an explanation of the water rights claimed by MCWRA, the FEIR responded only as to surface water rights, and ignored groundwater. (9ROP 4975-4976 [TOMP-4].) To a detailed request for "the specific water rights" (8ROP 4415-4416 [TOMP-6]), the FEIR referred to two other responses (9ROP 4978 [TOMP-6]) which did not provide the information sought. To CaiAm's question about water rights (8ROP 4176), the FEIR responded that "all water rights ... would have to be obtained at the appropriate time" (9ROP 4799).

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The EIR failed as an informational document, and the responses to comments were not the "good faith, reasoned analysis in response" mandated by CEQA. (CEQA Guidelines, § 15088, subd. (c); The Flanders Foundation v. City of Carmel-by-the-Sea (2012) 202 Cai.App.4th 603, 615 (Flanders Foundation); SCOPE, supra, 106 Cai.App.4th 715, 722-723.) 4. Marina Coast's Argument on Appeal.

In the superior court, Marina Coast argued in its brief on the merits that Marina Coast "was not required to and did not analyze water rights claims related to water pumped from the intake wells" (3AA 531 ), Marina Coast "would not 'pump' any water" (3AA 532; see 3AA 535), and "MCWRA would own the intake wells and would do any pumping" (3AA 534; see 3AA 535). At the October 2011 oral argument in the superior court, Marina Coast abandoned its written position and for the first time made new and different assertions (22AA 5522 [line 23]). On appeal, Marina Coast asserts that it has water rights that it would use to "take that same amount of product water from the project" and that Marina Coast would "defer" pumping from an unidentified source. (AOB 47-48.) The EIR did not take the position that Marina Coast now urges on this Court. A post hoc declaration of the agency may not be

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considered by this Court (Environmental Protection Information
Center v. California Dept. of Forestry (2008) 44 Cal.4th 459, 487).

The EIR did not identify water rights held by Marina Coast, did not identify water rights to be used for the Regional Project, and did not quantify the amount of pumping required for the project. The EIR did not analyze any deferral of pumping by Marina Coast. The EIR project description did not include an offset of reduced pumping in the Salinas Valley Groundwater Basin. An EIR cannot be deemed adequate for analysis the EIR did not include. (Galante Vineyards v.
Monterey Peninsula Water Management District ( 1997) 60

Cai.App.4th 1109, 1124 ["everything that is required to be considered in an EIR must be contained in that formal report"], citing Santiago
County Water Dist. v. County of Orange (1981) 118 Cai.App.3d 818,

831.) a. The EIR Did Not Discuss Water Rights Now Asserted by Marina Coast.

In an overdrafted, percolated groundwater basin, California groundwater law holds that the doctrine of correlative overlying water rights applies (Katz v. Walkinshaw (1903) 141 Cal. 116, 134-136), whereby no surplus water is available for new groundwater appropriators, except in specific circumstances (City of Pasadena v.
City of Alhambra (1949) 33 Cal.2d 908, 926). The Regional Project

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would require additional withdrawals of groundwater to be appropriated from the overdrafted Salinas Valley basin in order to provide the intake water for the desalination plant. Marina Coast does not claim any adjudicated rights. Marina Coast is an appropriator in an overdrafted groundwater basin. (See City of Santa Maria v. Adam, supra, 211 Cai.App.4th 266, 296-297 [discussing how prescriptive rights can be acquired only in time of surplus (e.g., not overdraft) and how unadjudicated prescriptive rights are difficult to determine].) Contrary to Marina Coast's assertion (AOB 4 7), any claimed rights to groundwater by Marina Coast are speculative and uncertain (ROP 4730 [any Marina Coast rights "would be subject to proof']; AOB 47 [vague allegations of "sufficient rights" and "claimed rights"]). Absent water rights in the overdrafted basin, the project would not have an available water supply. (Vineyard, supra, 40 Cal.4th 412, 432.) The sole support cited by Marina Coast for its dubious claim of "water rights" is a 1996 agreement with Monterey County Water Resources Agency (AOB 47, fn. 177). The 1996 agreement does not support the claim. Monterey County Water Resources Agency is organized under County Water District Law. MCWRA has constitutional police power over groundwater (9ROP 4 729). The Regional Project would have

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required new additional pumping from the overdrafted 180-foot aquifer (1 ROP 12; 9ROP 4555). Marina Coast does not currently pump from the 180-foot aquifer (4ROP 2286; 5ROP 2685). MCWRA has long opposed any pumping by Marina Coast from the 180-foot aquifer. The 1996 agreement between MCWRA and Marina Coast states that MCWRA believes that pumping by Marina Coast "would not be appropriate from ... the 180-foot confined aquiferD ... in the Salinas Valley Groundwater Basin" (14ROP 7711 ). Further, the 1996 agreement limits Marina Coast's use and distribution of water. (5ROP 2685.) Each of Marina Coast's record citations (AOB 47, fn. 177) has been discredited by the Ag Land Trust (22AA 5475-5477). b. The EIR Did Not Analyze the Deferral of Pumping.

Contrary to Marina Coast's unsupported claim that "it would defer pumping" (AOB 48), the EIR did not contain evidence that Marina Coast would cease current pumping in order to enable pumping at new Regional Project wells. The only evidence was to the contrary. The EIR assumed that Marina Coast would continue to use other "water supplies" (5ROP 2792) and that Marina Coast would continue to rely upon "its existing groundwater supplies" (9ROP 4541 ). Because the EIR did not discuss deferral of pumping, deferral was not subjected to public review. To the extent that deferral was 36
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intended by Marina Coast to mitigate project pumping, it should have been addressed in the EIR. The purpose of CEQA is to inform both the public and the decision makers, before the decision is made, of any reasonable means of mitigating the environmental impact of a proposed project. (The Flanders Foundation, supra, 202 Cai.App.4th 603, 617.) The cases mentioned by Marina Coast do not support Marina Coast's arguments (AOB 46, 48). Cherry Valley Pass Acres &

Neighbors v. City of Beaumont (201 0) 190 Cai.App.4th 316, is
distinguishable. In Cherry Valley, the critical facts included an adjudicated basin (id. at p. 336), a "physical solution" which provides an equitable remedy for allocating and sharing water (id. at pp. 330331 ), a quantified award of water to an owner, and a proposed development project with a specific estimated water demand (ibid.). The issue was whether the adjudicated figure was properly used as the EIR baseline (id. at pp. 338-340) where the project's estimated demand would be less than the EIR baseline (id. at p. 347). Unlike in Cherry Valley, the Salinas Valley Groundwater Basin is not adjudicated, no "physical solution" has been imposed by the Court, Marina Coast has no adjudicated right to groundwater, and the Regional Project EIR did not use a baseline and did not

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adequately quantify the amount of groundwater pumping needed for the Regional Project. c. The EIR Did Not Adequately Address the Amount of Pumping Required for the Project.

The EIR did not quantify the amount of pumping for the project (5ROP 2877 [groundwater would be extracted "at unspecified volumes"]). In the superior court, Ag Land Trust described the EIR's inadequate analysis of the amount of groundwater that would be pumped. (2AA 394-397.) On appeal, Marina Coast suggests that the project would require pumping 20,000 acre feet per year (AFY) of groundwater (AOB 47). But Marina Coast's citations (AOB 48, fn. 178) do not support its claim. 7ROP 3793-3794 and 9ROP 4553 do not mention the amount of pumping. 7ROP 3757 mentions modeling of pumping 20,000 AFY from five wells (7ROP 3752), but that page is from a 2008 technical memorandum for analysis of a draft EIR project alternative called Scenario 4d (7ROP 3751 [subject line]). That memorandum is not applicable because Scenario 4d was superseded by Scenario 4f in the FEIR. (5ROP 2865.) Scenario 4f required six wells (7ROP 3793). Scenario 4f was the approved project. (4ROP 1995 ["Regional Project" refers to revised project

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described in Appendix Q], 5ROP 2787; 1ROP 12 [approved project has six wells]; 9ROP 4541, fn. 7.) As additional evidence of the inaccuracy of Marina Coast's claim that project pumping would be approximately 20,000 AFY (AOB 47-48), FEIR Appendix Q stated that pumping would be 22.2 million gallons per day (mgd) or more (5ROP 2808 [Table 5-3A]; 7ROP 3828). One mgd is approximately 1,120 AFY. (O.WL.

Foundation v. City of Rohnert Park (2008) 168 Cai.App.4th 568, 576,
fn. 2.) Thus, 22.2 mgd would be over 24,860 AFY, which is significantly more than 20,000 AFY. The actual figure could be even higher because it was "to be determined" (5ROP 2808 ["tbd" in Table 5-3A]) at some point in the future. Marina Coast also argues that, based on the EIR's assumption that the groundwater was 15% fresh water and 85% seawater, Marina Coast's asserted water rights of 9,350 AFY would be sufficient to pump 20,000 AFY. (AOB 47-48.) The asserted water rights are uncertain, as argued above. The asserted rights were not in the EIR, thus cannot be relied upon as evidence of the EIR's adequacy. (Galante Vineyards, supra, 60 Cai.App.4th 1109, 1124.) The EIR's 15%/85% assumption is not reliable because it is based on a water sample from a location that was not the proposed well field site (7ROP 3794). Based on that unreliable sample, the FEIR
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revealed that the source water would be up to 40% fresh water (2ROP 907; 7ROP 3810-3811 [wells would produce total dissolved solids [TDS] concentration of 21,300 mg/L, which is 60% of seawater's TDS concentration of 34,000 to 35,000; the remaining 40% is fresh water]). 40% is significantly larger than the EIR's assumption of 15% (2AA 395-396). A fresh water component of 40% would require groundwater pumping of 88,000 AFY in order to meet regulatory requirements (2ROP 933; 3ROP1123), which the FEIR did not disclose. d. Conclusion.

Because additional groundwater withdrawals would be required from the project, because the EIR failed to identify water rights for the additional pumping, and because the EIR failed to "clearly and coherently explain" the issue, the EIR failed as an informational document. (Vineyard, supra, 40 Cal.4th 412, 421; CEQA Guidelines,§§ 15144, 15151.)

B.

SIX OTHER SUBSTANTIVE DEFECTS IN THE

EIR.

In addition to water rights, Ag Land Trust briefed six other substantive flaws in the EIR. (2AA 371-403; 14AA 3377-3380, 35953597; 18AA 4499-4502.) The superior court determined that each of the claims, including water rights, is meritorious. (22AA 5488, 5523.)

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.1.

Lack of Contingency Plans and Impacts Thereof.

The EIR failed (see 2ROP 597) to identify the County requirement that desalination plants must have a contingency plan for an alternative water supply (3ROP 1162-1163) to protect human health and safety. The EIR failed to discuss the lack of reliability of desalination plants, which are notoriously unreliable (2ROP 600, 826, 933; 3ROP 1125-1126,1370-1371,1471, 1475). There is no evidence of reliability in the record. No other plants of even closely comparable size (10 mgd [5ROP 2791]) operate in California (3ROP 1353); in other states, such plants have been unreliable and have never operated at full capacity (3ROP 1460, 1471-1472; 2ROP 751). No active California plant involves municipal or domestic uses, as proposed for Marina Coast's plant (5ROP 2791 ). Because the EIR failed to identify a backup water supply plan, the EIR did not evaluate the foreseeable impacts of that plan, as CEQA requires. The only "emergency backup" plan in the record was to take water from the Carmel River and the Seaside Basin (2ROP 829)the water supplies that are being illegally pumped and are suffering environmental damage (4ROP 2062-2063; 5ROP 2790; 1OROP 5142-5143). The Carmel River and the Seaside Basin are governed by legal rulings that severely limit the legal right to take water from them. (Ibid., 4ROP 2062-2063.) The EIR failed to make the
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required effort to identify the environmental harm caused by use of these "backup" sources, or the water rights that would allow use of these sources. 2. Assumption of Continuous Groundwater Pumping.

Continuous groundwater pumping was not part of the draft EIR project description. However, the FEIR relied on a new description of the Regional Project that assumed six vertical intake wells "pumping continuously" (5ROP 2874; 7ROP 3828) for 56 years (5ROP 2874-2875). That new model, called Scenario 4f, was prepared for Marina Coast (7ROP 3804 ), and showed up for the first time in the FEIR in a new document, Appendix Q (4ROP 1973). Continuous pumping is the basis for the EIR assumption that the wells would create a "trough" that "could act as a barrier'' to (5ROP 2865), and "would halt the advancement" (9ROP 4551) of, further seawater intrusion, according to Appendix Q (7ROP 3794, 3804, 3809). This "barrier" (5ROP 2866) and its effects are unlikely and uncertain because pumping from the 180-foot aquifer has caused seawater intrusion (9ROP 4548). New coastal pumping would likely cause the same impact: more seawater intrusion. (3ROP 1264, 1272; 7ROP 3755.) Further, the EIR conclusion that seawater intrusion "would halt" (9ROP 4551) was contradicted by the EIR conclusion that the post-project rate of seawater intrusion would
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be similar to baseline conditions and the intrusion would be worse in the vicinity of the intake wells and the area south of the Salinas River (5ROP 2865-2866). That area is productive agricultural land (5ROP 2628; 6ROP 2980, 2982; 7ROP 381 0). Given the unreliability of large desalination plants, it is reasonably foreseeable that one or more of the six wells would not pump continuously for 56 years, and as a result the assumed impacts of the "trough" would not be achieved. That means that seawater intrusion could be worsened, which is likely to affect the Salinas Valley physical environment and agriculture. The EIR did not disclose in good faith the uncertainty around the assumption of constant pumping, and did not investigate the potential impacts if pumping was not continuous. Because the assumption was not in the Draft EIR, it was not presented for public comment, thereby violating CEQA's procedural mandates (e.g., CEQA Guidelines,

§§ 15151, 15200, 15204).
3. Prohibition on Exportation of Groundwater.

California law prohibits exportation of groundwater from the Salinas Valley Groundwater Basin due to concern about the "balance between extraction and recharge." (4ROP 2274, 2289.) The Draft EIR improperly assumed that there would not be exportation (5ROP 2877). The FEIR relied on Marina Coast's assumption that 43
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the groundwater pumped for the project - the "intake" water - would be 85% seawater and 15% fresh water (7ROP 3792; 2ROP 843). That assumption was not reliable for several reasons. The assumption was for only the first 10 years of the 56-year project. (5ROP 2866; 7ROP 3811.) The assumption was based on a groundwater sample from a site at Marina Coast's offices (7ROP 3794), not the proposed well field (11 ROP 5854), and "on a local scale there were variations in ... chloride concentrations" (7ROP 3794 ). FEIR Appendix Q predicted up to 40% fresh water (2ROP 905, 907; 7ROP 3810-3811). The EIR did not analyze the possible impacts of groundwater exportation under a scenario where the intake water had more than the 15% fresh water, even though larger percentages are foreseeable and would likely result in exportation. 4. Brine Impacts on Outfall Pipeline.

The desalination project proposed to dispose of project waste brine through the existing sewage outfall. (1ROP 2 [§7.3], 16.) A study by another water agency had concluded that a smaller desalination plant (2ROP 745) would discharge brine amounts that would exceed the outfall capacity during high-flow periods (2ROP 747). Despite this known conclusion, the EIR failed to adequately investigate whether the outfall had adequate capacity for Regional

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Project brine, and what impacts would be caused by inadequate capacity. Marina Coast and Monterey Regional Water Pollution Control Agency, the owner of the outfall, acknowledged that the EIR inadequately disclosed the impacts of brine disposal, and planned additional studies to be funded by Marina Coast (3ROP 1172-1173, 1176; 15ROP 8098-8099). Experts also were concerned about the brine's corrosion impacts decreasing the life of the outfall ( 14AA 3398 [ROP 8155]). After the FEIR was released, Marina Coast received- from a Marina Coast expert consultant - a report that "the conveyance of the MCWD brine will reduce the [outfall] time to corrosion by over 40 percent. This is a significant impact." (14AA 3430 [ROP 8187].) The EIR did not include this information or adequately analyze or mitigate the corrosion impacts. 5. Impacts to Overlying and Adjacent Properties.

The EIR predicted that the project's six intake wells would cause up to a 30-foot drawdown in the groundwater (9ROP 4552) and increased saltwater intrusion under the well field (4ROP 19331934; 5ROP 2865). The well field was proposed to be located south of the Salinas River (5ROP 2802 [Fig. 5-3, showing well location in blue]), on or adjacent to productive agricultural land (3ROP 11371138, 7ROP 3798 [aerial photograph]). The EIR did not adequately
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identify and investigate the impacts on the physical environment of the agricultural property or the associated water rights. 6. Violations of Anti-Degradation Policy and Basin Plan

The EIR failed to adequately investigate and disclose the impacts of the project's increase in salinity in the groundwater in the vicinity of project wells (5ROP 2865-2866). The increase in salinity foreseeably would violate the State Water Resources Control Board's antidegradation policy (see Asociacion de Gente Unida por

el Agua v. Central Valley Regional Water Quality Control Board
(2012) 210 Cai.App.4th 1255, 1261-1262 [describing policy]). The Basin Plan implements the Anti-Degradation Policy. The EIR merely mentions that the policy "could apply" (4ROP 2271 ), which is inadequate informational analysis under CEQA. (CEQA Guidelines,

§§ 15144, 15151.)
C. BECAUSE THE EIR WAS DEFECTIVE, A NEW EIR WAS REQUIRED TO BE PREPARED BY MARINA COAST AS LEAD AGENCY.

An incorrect designation of the lead agency requires the preparation of a new EIR under the direction of the proper lead agency where the initial EIR is defective. (PCL v. DWR, supra, 83 Cai.App.4th 892, 903-907, 920.) PCL v. DWR is the case most analogous on this point to the present case. It used a two-step analysis: (1) Did an incorrect lead agency prepare the EIR? (2) If so,

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is there at least one deficiency in the El R? If the test is met, the matter is remanded to the proper lead agency in order for that agency to prepare a legally sufficient EIR. (/d. at p. 926.) In PCL v. DWR, the Court of Appeal concluded that the wrong agency had been designated as lead agency, and that the EIR was inadequate in at least one important respect. The Court therefore ordered "the preparation of a new EIR under the direction of' the proper lead agency (83 Cai.App.4th 892, 907). The Court stated that it need not further inquire into the remaining alleged defects in the EIR "as we ordinarily would" (id. at p. 920, referencing Pub. Resources Code,§ 21005, subd. (c)) because the proper lead agency "may choose to address those issues in a completely different and more comprehensive manner" (id. at p. 920). Marina Coast is not correct in its claim that "the superior court was required to state its decision on each of the seven alleged EIR deficiencies." (AOB 51.) The Judgment stated that Marina Coast's approval of the Project failed to adequately identify, discuss, and address the seven deficiencies raised. (22AA 5488.) The Judgment relied on PCL v. DWR. (22AA 5513.) In response to the seven EIR defects briefed by Ag Land Trust in the superior court, Marina Coast presented no meaningful written defense. (22AA 5522 [line 22].) On appeal, Marina Coast argues
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only the issue of water rights (AOB 45-50). Marina Coast's briefing to this Court as to the six other EIR defects is supported solely by citations to its oral argument at the CEQA hearing "and ROP cited" there (AOB 51, fns. 189-195). The Court should deem the six EIR flaws abandoned by Marina Coast. "Points that are not properly raised in the trial court are ordinarily waived on appeal." (Guardians of Turlock's Integrity v.
Turlock City Council (1983) 149 Cai.App.3d 584, 599; Save the Sunset Strip Coalition v. City of W Hollywood (2001) 87 Cai.App.4th

1172, 1181, fn 3.) "Briefing" involves more than simply raising a point orally at oral argument. When a party asserts a point but fails to support it with reasoned argument and citations to authority, the court may deem it to be forfeited. (AmeriGas Propane, L.P. v.
LandstarRanger, Inc. (2010) 184 Cai.App.4th 981, 1001, fn. 4.) As

this Court has held, "When an issue is unsupported by pertinent or cognizable legal argument it may be deemed abandoned and discussion by the reviewing court is unnecessary" (Landry v.
Berryessa Union School Dist. (1995) 39 Cai.App.4th 691, 699-700).

Marina Coast's claim that Code of Civil Procedure section 632 required the superior court to issue a statement of decision (AOB 51) is unavailing. Section 632 does not apply to this law and motion hearing. (City of Carmel-by-the-Sea v. Board of Supervisors ( 1986)

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183 Cai.App.3d 229, 237-238.) In any event, before entering the Judgment, the court explained its reasoning by filing an intended decision (21AA 5362-5384}, reviewing additional briefing by the parties (22AA 5392-5403, 21AA 5385-5391 }, filing an amended intended decision (22AA 5406-5440), and reviewing further written arguments (22AA 5443-5462, 5463-5481) before ordering that the amended decision is the Statement of Decision (22AA 5482). (Onofrio v. Rice (1997) 55 Cai.App.4th 413, 425 [statement of decision that responds to each material issue "passes appellate muster"].) There is no error, and no prejudice to Marina Coast.

Ill.
THE SUPERIOR COURT HAD JURISDICTION OVER THE CEQA CHALLENGE TO MARINA COAST'S ACTIONS. A. PUBLIC UTILITIES SECTION 1759 DOES NOT AFFECT THE SUPERIOR COURT'S LAWFUL EXERCISE OF JURISDICTION IN THIS CASE.
Marina Coast's primary claim in the superior court, on the two writ proceedings, and on appeal, is that under Public Utilities Code section 1759 the superior court did not have jurisdiction to review Marina Coast's independent decisions to approve the Project. (AOB 26-31 ). Section 1759 bars certain actions which seek to "review, reverse, correct, or annul any order or decision of the commission or

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to suspend or delay the execution or operation thereof, or to enjoin, restrain, or interfere with the commission in the performance of its official duties, as provided by law" (Pub. Utilities Code, § 1759, subd. (a)). However, Marina Coast, a local public agency, is not subject to CPUC jurisdiction, and the CPUC has no authority to impose any obligation upon Marina Coast under the CPUC's regulatory authority. The superior court had jurisdiction over the litigation here. As the superior court found and determined, the CPUC "has no authority to regulate or dictate to Marina Coast, or any other public agency, regarding the approval and development of the Regional Project. This action does not hinder the PUC's ability to regulate [CaiAm], and this Court has jurisdiction." (22AA 5526.) Marina Coast's presentation (AOB 26-38) is confusing and unduly selective. Nowhere does Marina Coast recognize the CPUC's lack of jurisdiction over Marina Coast. Marina Coast cites to documents not in the record, and fails to cite the evidence in the record that supports the superior court's ruling that the CPUC had no authority over Marina Coast. (AOB 3, fn. 20; Cal. Rules of Court, rule 8.204(a)(1 )(C)].)

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8.

THE SUPERIOR COURT WAS NOT DEPRIVED OF JURISDICTION BY PUBLIC UTILITIES CODE SECTION 1759, SUBDIVISION (a).

The CEQA lawsuit was not against CaiAm or the CPUC. The CEQA lawsuit brought by Ag Land Trust was directed at Marina Coast, a local public agency over which the CPUC has no jurisdiction. The lawsuit sought to have Marina Coast comply with CEQA in its decision to carry out the project. The public policy behind CEQA enforcement is strong, and weighs heavily in favor of the jurisdiction of the superior court. The overriding purpose of CEQA is to ensure that agencies regulating activities that may affect the quality of the environment give primary consideration to preventing environmental damage. (Save Our Peninsula, supra, 87 Cai.App.4th 99, 117.) CEQA is the Legislature's declaration of policy that all necessary action be taken to protect, rehabilitate, and enhance the environmental quality of the state. (Ibid.; Laurel Heights Improvement Assn. v. Regents of University of California (1988) 47 Cal. 3d 376, 392 (Laurel Heights/).) There is no statutory or public policy conflict between Ag Land Trust's CEQA challenge to Marina Coast's approvals and the CPUC's proceeding involving CaiAm. (Sohio, supra, 23 Cal.3d 812, 814 [superior court had jurisdiction over local public agency, and

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court "should have permitted the action to proceed against the (local agency) alone"].) In 2003, when the CPUC determined that it should be lead agency under CEQA on CaiAm's proposed projects, the CPUC determination was based on CEQA Guidelines section 15051. The only projects before the CPUC at that time were proposed by CaiAm, a CPUC-regulated entity. (14ROP 7667-7668.) The CPUC relied on subdivision (b), which applies only to projects that will "be carried out by a nongovernmental person or entity" and states that for a nongovernmental project, "the lead agency shall be the public agency with the greatest responsibility for supervising or approving the project as a whole." (14ROP 7670, underlining added.) At the time, the CPUC concluded that the CPUC was the agency with the greatest responsibility for supervising or approving the nongovernmental CaiAm projects as a whole (14ROP 7676). After the public agencies proposed their Regional Project in 2008, the CPUC never revisited its 2003 determination that the CPUC should be lead agency, even though the Regional Project would be carried out by governmental entities not subject to CPUC control (9ROP 4534, fn. 6; 4536, fn. 2). CEQA did not authorize the CPUC to be lead agency for the Regional Project. For a public project such as the Regional Project,

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subdivision (a) of CEQA Guidelines section 15051 controls. Under subdivision (a), the public agency that is to carry out the projectMarina Coast- is the lead agency.
C. THE CASES RELIED ON BY MARINA COAST Do NOT APPLY TO PUBLIC AGENCIES NOT REGULATED BY THE CPUC.

Marina Coast cites San Diego Gas & Electric Company v. Superior Court (1996) 13 Cal. 4th 893 (Covalt) in passing (AOB 23, 29) or for general propositions (AOB 40). In Covalt, the Supreme Court held that property owners could not sue a CPUC-regulated utility over the effect of nearby power lines. (13 Cal.4th 893, 903.) Plaintiffs argued that a "public fear of such fields" (id. at p. 914) had diminished the value of their property. The issue in Covalt was whether private causes of action may be asserted in superior court for personal injury claims and damages allegedly caused by an entity and an activity that are regulated by the CPUC (Pub. Util. Code,§ 2106). In Hartwell Corp. v. Superior Court of Ventura County (2002) 27 Cal.4th 256, 260 (AOB 29), the Supreme Court held that the claims against CPUC-regulated entities were barred by Public Utilities Code section 1759 because their adjudication would interfere with the CPUC's regulatory authority. The Supreme Court held that the claims against nonregulated entities (public agencies) were not

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precluded by section 1759 because the public agencies were not part of the CPUC's scope of regulation, and because section 1759 does not bar private lawsuits in superior court against public agencies. (Hartwell, supra, 27 Cal.4th 256, 282.) Under Hartwell, non regulated entities - such as Marina Coast- cannot avoid legal scrutiny of their actions by asserting protections reserved for CPUC-regulated entities. Marina Coast cites to People ex ref. Orloff v. Pacific Bell (2003) 31 Cal.4th 1132 (AOB 30), but misinterprets the meaning of the case. In Orloff, several district attorneys filed a civil action alleging that the telephone company (a CPUC-regulated entity) engaged in false advertising and unfair business practices. (31 Cal. 4th 1132, 1137.) A proceeding involving some of the same allegations against the company was pending before the CPUC. (Ibid.) The superior court and the First District Court of Appeal reasoned that because the CPUC proceeding and civil action could result in inconsistent rulings and "thus might result in factual and legal conflicts with regard to ongoing PUC proceedings," the civil action should be dismissed under Public Utilities Code section 1759.
(ld. at p. 1142.) The Supreme Court reversed the lower courts,

holding that the remedies sought by the district attorneys were cumulative to those in the CPUC proceedings (id. at p. 1151 ), and
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that the civil action did not violate section 1759 (id. at p. 1156; see pp. 1144, 1149). Marina Coast's presentation of Covalt, Hartwell and Orloff confuses the proper analysis. The superior court held as follows: (1) The CPUC did not have the right, ability, or authorization over the public agencies' Regional Project under CEQA (22AA 5509 [line 20] through 5511 [line 8], 5512 [lines 13-16], 5526 [lines 1-4].) (2) The CPUC did not exercise authority over the Regional Project other than including the Project in an alreadyunderway EIR for CPUC-regulated projects and considering whether to grant a certificate to CaiAm for CaiAm's role (22AA 5511 [lines 13-16], 5526 [lines 1-4]). (3) The grant of relief sought by Ag Land Trust against Marina Coast would not interfere with the CPUC's policies or duties because the relief would vacate only Marina Coast's approvals of the Regional Project (22AA 5488 [lines 7-27], 5526 [lines 1-4]).
D. THE CPUC's POSITION Is NOT MATERIAL OR DISPOSITIVE HERE.

Marina Coast argues that the superior court decision was in contravention of the CPUC's position, and that the court decision

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interfered with the CPUC's performance of its official duties. (AOB 26-31.) When the issue is the scope of the CPUC's jurisdiction, the CPUC is not the arbiter of its own authority. That is the exclusive province of the courts. (PG&E Corporation v. Public Utilities Commission (2004) 118 Cai.App.4th 1174, 1194-1195, quoting Kaiser Foundation Health Plan, Inc. v. Zingale (2002) 99 Cai.App.4th 1018, 1028; California Veterinary Medical Assn. v. City of West Hollywood (2007) 152 Cai.App.4th 536, 556 [state agency's interpretations of a statute or regulation "are not binding or necessarily even authoritative"].) Contrary to Marina Coast's implied claim (AOB 30), People v. Orloff, supra, 31 Cal. 4th 1132 does not hold that this Court should seek the CPUC's opinion as to whether this case interferes with its jurisdiction. Under the circumstances in Orloff, involving overlapping enforcement of a regulated entity (phone company), an opinion from the CPUC as to whether the action interfered with the performance of CPUC duties could be considered helpful. (/d. at p. 1138; see p. 1156, fn. 12.) There is no claim of overlapping enforcement in this CEQA litigation against Marina Coast. It is unclear what legal principle Marina Coast is arguing in its collective cite of eight cases in support of its claim that "No California

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appellate court having a Commission amicus curiae brief before it in a section 1759 case has ever reached a conclusion contrary to the Commission's stated position in any reported case." (AOB 30-31.) The eight cases certainly do not comprise a statistically significant universe, and the widely varying subject matters of the selected cases do not reliably prove anything. None of the cases is in the CEQA context, is in regard to the environmental review of a public agency's water project, or proves causation from correlation. For example, Sara/e v. Pacific Gas and Electric Co. (2010) 189 Cai.App.4th 225, the first of the eight cases (AOB 30), is yet another case involving damage claims by private parties against a regulated entity arising out of activities regulated by the CPUC. Therefore, the rationales for the Court's holding are not pertinent to this case. To demonstrate the logical flaws in Marina Coast's claim even further, Marina Coast does not take into account the Sohio decision, where it was settled by the Supreme Court that requiring a local agency to act as the lead agency on a case where the EIR was prepared by the CPUC was the correct way to determine the CEQA and jurisdictional issues in a case similar to the present one. Amicus letters or briefs do not alter the significance or application of the Supreme Court's decision in Sohio.

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IV. MARINA COAST'S REMAINING AFFIRMATIVE DEFENSES ARE WITHOUT MERIT. A. DERIVATIVE CLAIMS RELATING TO THE CPUC HAVE NO MERIT. Marina Coast's asserted affirmative defenses of Public Utilities Code section 1759, res judicata, ripeness, and exhaustion (AOB 2638) all depend on an underlying claim that the CPUC had sole authority over Marina Coast's actions and that the superior court does not have jurisdiction. These claims fail because the trial court had jurisdiction over Marina Coast. Marina Coast's res judicata claim (AOB 32-33) is barred for other reasons as well. As the superior court determined, res judicata only applies if all the following exist: "(1) the decision in the prior proceeding is final and on the merits; (2) the present proceeding is on the same cause of action as the prior proceeding; and (3) the parties in the present proceeding or parties in privity with them were parties in the prior proceeding." (22AA 5525, citing Federation of

Hillside Canyon Assns. v. City of Los Angeles (2004) 126
Cai.App.4th 1180, 1202.) There was no final litigated prior decision on the merits regarding which public agency was to carry out - or be lead agency for - the Regional Project, or regarding the adequacy of

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the EIR. (Ibid., citing Mycogen Corp. v. Monsanto Co. (2002) 28 Cal.4th 888, 896-897.)

8.

AG lAND TRUST'S CHALLENGE TO RESOLUTION 2010-18 (PROPERTY PURCHASE) Is NOT SEPARATELY MOOT.

In March 2010, Marina Coast adopted Resolution 2010-18 to authorize purchase of 224 acres of land (Armstrong Ranch) north of Marina for the site of the desalination plant. (4ROP 1726-1824.) Marina Coast filed a Notice of Determination under CEQA, confirming that the property was for the Regional Project. (2ROP 1083-1 085.) That purchase was challenged as part of the CEQA lawsuit. (1AA 30-33, 37.) Marina Coast now claims that it mooted the CEQA action regarding Resolution 2010-18 by "consummating the transaction" (AOB 33-34) three months after the CEQA action was filed and served. Marina Coast acted at its own risk and peril when it purchased the property despite the pending litigation. As several cases point out, a public agency or project proponent (Marina Coast was both) cannot moot a CEQA action by going ahead with the project. In
Bakersfield Citizens for Local Control v. City of Bakersfield (2004)

124 Cai.App.4th 1184, 1203-1204, the superior court invalidated the EIR, but the developer transferred property interests to third parties. The Court of Appeal held that such third party transactions "do not

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immunize defective land use approvals" because as a matter of public policy and equity, developers are not permitted to defeat a CEQA suit by "transferring interests in the underlying real property."
(/d. at p. 1203.) The same result occurred in Woodward Park Homeowners Association v. Garreks, Inc. (2000) 77 Cai.App.4th

880, 888-890, where the Court of Appeal held that a case was not moot because a completed car wash project could be removed, torn down, or modified. Marina Coast must live with the "consequences of its financial choice" (id. at p. 882). Marina Coast argues that Ag Land Trust was required to obtain an injunction against Marina Coast in 201 0 to prevent Marina Coast from purchasing the Armstrong Ranch property. (AOB 33-34.) The Regional Project was at least several years away from obtaining its many permits. (See 5ROP 2833-2837.) There was no need or legal obligation for Ag Land Trust to specially enjoin Marina Coast's purchase of the property.
C. AG lAND TRUST'S CLAIMS WERE RIPE AS TO RESOLUTION 201018 (PROPERTY PURCHASE) AND 2010-20 (PROJECT APPROVALS).

Marina Coast makes a claim that the petition was not ripe. (AOB 34-35, citing Pacific Legal Foundation v. California Coastal
Commission (1982) 33 Cal.3d 158.) The claim is without merit.

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Under CEQA, an agency decision is final for purposes of judicial review when the agency files a notice of determination or notice of exemption in connection with its decision to approve or carry out the project. (Pub. Resources Code,§ 21167, subds. (a)(c); CEQA Guidelines, § 15352, subd. (a) ["approval" of project is "the decision by a public agency which commits the agency to a definite course of action in regard to a project"].) It would be illogical and wasteful to require challenges to an EIR to be filed before any project is approved based on that EIR. CEQA challenges are based on an inadequacy of the environmental documents to accurately assess the environmental impacts of a specific project, not upon an EIR analysis that may apply to a project that is never approved. (Pub. Resources Code, §§ 21167, subds. (a)-(b) [approval of "project," not certification of EIR, makes case ripe for CEQA challenge]; 21152, subd. (a).) In March and April 2010, Marina Coast acted first to approve the Regional Project and Marina Coast was the lead agency. Ag Land Trust promptly sued Marina Coast. No CEQA challenge against the CPUC was appropriate because the CPUC did not and could not approve any project. The CPUC's 2009 certification of the EIR was not a final approval of a project under CEQA.

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Despite Marina Coast's claim to the contrary (AOB 34-35), this case is not analogous to Cedar Fair, L. P. v. City of Santa Clara (2011) 194 Cai.App.4th 1150. In finding that approval of a term sheet was not a project approval under CEQA, this Court in Cedar

Fair relied upon significant statements in the term sheet.
Specifically, the term sheet contained "preliminary terms" (id. at p. 1168), stated that the project "shall not proceed unless and until" the CEQA environmental review process is completed (ibid.). and stated it was "not intended ... to commit any Party to a particular course of action" (id. at pp. 1168-1169).

1...

Resolution 201 0-18 (Property Purchase).

The March 16, 2010 approvals by Marina Coast were final and were made in reliance on the EIR, as shown by the Resolution and the March 17, 2010 Notice of Determination (2ROP 1083-1086). As the superior court found, "If Ag Land had not challenged Marina Coast's approvals, the 30-day limitations period to challenge Marina Coast's Notice of Determination would have foreclosed a challenge to the Regional Project." (22AA 5513; see 22AA 5511 :13-15.) 2. Resolution 2010-20 (Project Approvals).

On April 5, 2010, Marina Coast approved Resolution 2010-20, which approved the Regional Project and adopted CEQA findings, CEQA mitigation monitoring chart, and CEQA statement of

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overriding considerations. (1 ROP 8-115.) As a matter of CEQA law, the CEQA claims became ripe no later than April 5, 2010. Ag Land Trust filed its first amended CEQA petition on April 6, 2010. (1AA 21-41.) Ag Land Trust's challenge met all CEQA criteria. Marina Coast asserts that its April 5, 2010 approvals were conditioned upon final approval by the CPUC. (AOB 8.) The superior court correctly found that the approvals were not conditional. (22M 5512-5513.) By its terms, Resolution 2010-20 was Marina Coast's "final" approval without any further action by Marina Coast (1 ROP 3 [§8.1 0]). Resolution 2010-20 stated unconditionally as follows: NOW THEREFORE, BE IT RESOLVED, that .... 2. The Directors hereby approve and adopt the [CEQA] Findings ... , pursuant to CEQA Guidelines§§ 15091 and 15096(h). 3. The Directors hereby approve and adopt the Mitigation Monitoring and Reporting Plan .... pursuant to CEQA Guidelines 15096(g). (1ROP 6.) Resolution 2010-20 approved the Regional Project, 85 pages of findings of approval including 78 pages of CEQA findings, a mitigation monitoring program under CEQA, and a CEQA statement of overriding considerations. (1 ROP 1-264.) Marina Coast, in

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making its findings and adopting the CEQA approvals, approved the project unconditionally. In Save Tara v. City of West Hollywood (2008) 45 Cal. 4th 116, the Supreme Court held that an agency's own characterization of its actions as "conditional" is not dispositive. The Court held that an agency's actions, including "its willingness to bind itself' to the project based on a single condition - whose compliance would be determined by agency staff- "all demonstrate that [the agency] committed itself to a definite course of action regarding the project." (/d., at p. 142). Marina Coast asserts that under Save Tara, Ag Land Trust should have waited until December 2010 to file this action. (AOB 34-35.) Marina Coast does not acknowledge the superior court's determination that "Marina Coast acted first [to approve the project] and filed a Notice of Determination" in March 201 0 (22AA 5524 ["Ripeness"]) which started the 30-day clock for Ag Land Trust, nor does Marina Coast cite to the evidence in the record that supports the Judgment. Under CEQA, such a belated challenge would have been months late, and the action would have been barred.

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D.

AG lAND TRUST EXHAUSTED ITS ADMINISTRATIVE REMEDIES.

Marina Coast argues that Ag Land Trust failed to exhaust administrative remedies (AOB 35-38). Two of Marina Coast's "exhaustion" claims are that the CPUC had exclusive jurisdiction, and the third is the assertion that Ag Land Trust did not adequately present its CEQA claims. (Ibid.) Ag Land Trust presented its positions in writing and in person prior to the Marina Coast actions of March 16, 2010 and April 5, 2010. Ag Land Trust presented in detail all of its CEQA claims and submitted evidence. (3ROP 1106-1725; 2ROP 595-1021 [letters]; 4ROP 1922, 1ROP 554 [minutes].) Ag Land Trust exhausted its available remedies in regard to the approvals. The 2009 CPUC decision (AOB 36) did not approve a project. The 2010 CPUC decision (AOB 37) was made nearly eight months after the litigation against Marina Coast was initiated and after briefing on the merits had been completed in the superior court. There is no merit to Marina Coast's claim.
E. AG lAND TRUST DID NOT FAIL TO JOIN INDISPENSABLE PARTIES.

Marina Coast claims that Ag Land Trust failed to join Monterey County Water Resources Agency (MCWRA) and CaiAm as indispensable parties. (AOB 38-39.)

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The superior court correctly determined that MCWRA and CaiAm were not indispensable parties (22M 5526-5527). The decision is reviewed for abuse of discretion (County of Imperial.
supra, 152 Cai.App.4th 13, 25). Whether a party is indispensable is

a fact-specific inquiry, the resolution of which depends on practical considerations in the context of a particular litigation. (MHC
Operating Limited Partnership v. City of San Jose (2003) 106

Cai.App.4th 204, 215.)

1...

Statutory Requirements: CEQA.

In April 2010, when this action was filed, "real parties" (i.e., recipients of an approval) were named as parties in some cases, in addition to the public agency. (Pub. Resources Code,§ 21167.6.5, subd. (a). 4 ) "Potential parties" were not required to be named, and could not be indispensable parties. (/d. at subd. (d).) Failure to name any other party did not result in dismissal under CEQA. (Ibid.)

On January 1, 2012, Public Resources Code section 21167.6.5, subdivision (a) was amended to state, in pertinent part: "The petitioner or plaintiff shall name, as a real party in interest, the person or persons identified by the public agency in its notice filed pursuant to subdivision (a) or (b) of Section 21108 or Section 21152 or, if no notice is filed, the person or persons in subdivision (b) or (c) of Section 21065 .... " Ag Land Trust fully complied with the requirements. In its Notice of Determination, Marina Coast did not name MCWRA or CaiAm. (2ROP 1083-1085.)

4

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Neither MCWRA nor CaiAm were indispensable parties under CEQA. Neither was a "recipient of an approval" from Marina Coast. 2. Statutory Requirements: Code of Civil Procedure.

Code of Civil Procedure section 389 governs necessary and indispensable parties in general. Persons who ought to be joined, if possible, are "necessary parties." (Code Civ. Proc., § 389, subd. (a);

County of Imperial, supra, 152 Cai.App.4th 13, 26.) Any "necessary"
parties must also be "indispensable". (Code Civ. Proc., § 389, subd. (b), County oflmperial, supra, 152 Cai.App.4th 13, 30.) As the superior court correctly determined, a finding that Marina Coast was the lead agency did not "impair or impede" MCWRA's or CaiAm's ability to protect their interests, nor would either entity suffer prejudice by the lead agency determination and resolution of CEQA issues. (22AA 5527.) If the action had been dismissed for failure to join MCWRA or CaiAm, Ag Land Trust would not have an adequate remedy. (Ibid., citing Code Civ. Proc. § 389, subds. (a), (b); Pub. Resources Code,§ 21167.6.5, subd. (a).) The superior court acted within its discretion and substantial evidence supports its ruling. The judgment adequately adjudicated the rights of the parties before the court, because the only issues before the court were whether the EIR was adequate and Marina Coast's lead agency status. (Deltakeeper v. Oakdale Irrigation

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District (2001) 94 Cai.App.4th 1092, 11 08.) Marina Coast failed to
establish error, a prejudicial abuse of discretion, or any prejudicial harm to Marina Coast.

v.
THE SUPERIOR COURT PROPERLY DENIED MARINA COAST'S MOTION TO AUGMENT THE ADMINISTRATIVE RECORD.

Marina Coast claims that the superior court erred in denying Marina Coast's motion to augment the record. (AOB 52; see Code Civ. Proc., § 1094.5 [in administrative mandamus actions, judicial review is generally limited to administrative record]; Cal. Rules of Court, rule 8.204(a)(1 )(C); Madera Oversight Coalition, Inc. v.

County of Madera (2011) 199 Cai.App.4th 48, 62-66 [discussing
presumption that superior court's determinations regarding scope of CEQA administrative record are correct).) The superior court properly exercised its discretion in denying Marina Coast's motion to augment the record with post-decision documents. (15AA 3651 [lines 13-17].) As a general rule, in the absence of good cause and special circumstances, extra-record evidence, including post-decision evidence, is not admissible.

(Western States Petroleum Association v. Superior Court (1995) 9
Cal.4th 559, 577.)

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Marina Coast approved the Regional Project in March 2010 (4ROP 1726-1824) and April2010 (1ROP 1-264). On July 23,2010, Marina Coast certified the record of proceedings (1AA 180-182.) In October 2010, Ag Land Trust filed its reply brief (3AA 544). In June 2011 Marina Coast moved to augment the record with two postdecision documents created in December 2010 (4AA 989): a CPUC decision and a Marina Coast notice of determination (AOB 52; 4AA 992). The exclusion of the two post-decision extra-record documents caused no prejudice to Marina Coast, and Marina Coast cites to none. The presumption of prejudice discussed in the County of
Orange v. Superior Court of Orange County (2003) 113

Cai.App.4th 1, 13 (AOB 52) does not apply here because the records in that case were pre-decision records- an earlier EIR addendum and documents relating to that addendum - that were in the agency's possession at the time of the agency's decision. That rationale does not apply to post-decision records. The statute that describes the contents of a CEQA record of proceedings (Pub. Resources Code,§ 21167.6) does not require the inclusion of post-decision documents created eight months later. A statute should not be literally construed if to do so would lead to

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absurd results and would defeatthe
(Simpson

evident purpose.

v.

(20 10) 49 Cal. 4th

27.)

The purpose•of section 21

is to include in the record the

materials that were before the agency at the time of the challenged decision. was properly compiled.
CONCLUSION

each

the reasons stated above,

the interests of

justice, Respondent Ag Land Trust requests that this Court affirm the Judgment January 7, 2013 OF MICHAEL W. STAMP

Attorneys for Respondent, Ag Land Trust

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CERTIFICATE OF WORD COUNT (Calif. Rules of Court, rules The text of this brief consists. of
8.490)

words

by

the Corel WordPerfect word-processing program used to the document.

January 7, 2013

MICHAEL W. STAMP

Attorneys for Respondent Ag Land Trust

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PROOF OF SERVICE

STATE OF CALIFORNIA, COUNTY OF MONTEREY

I am employed in the County of Monterey, State of California. I am over the age of 18 and not a party to the within action. My business address is 479 Pacific Street, Suite One, Monterey, California 93940.
On January 7, 2013, I served the foregoing document described as follows:
RESPONDENT'S BRIEF

on the parties in this action as follows: ( X ) by placing a true copy thereof enclosed in a sealed envelope and addressed as shown below, and depositing the envelope with Federal Express for delivery the next business day. Mark Fogelman Ruth Stoner Muzzin Friedman & Springwater LLP 33 New Montgomery Street Suite 290 San Francisco, CA 941 05 Attorneys for Appellant Marina Coast Water District Telephone: (415) 834-3812

( X ) by placing a true copy thereof enclosed in a sealed envelope and addressed as shown below, and placing the envelope for collection and mailing on the date and at the place shown below following our ordinary business practices. I am readily familiar with this business practice for collecting and processing correspondence for mailing. On the same day that the correspondence is placed for collection and mailing, it is deposited in the ordinary course of business with the United States Postal Service in a sealed envelope with first class postage fully prepaid.

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Addressed as follows: Lloyd Lowrey, Jr. Noland, Hamerly, Etienne & Hoss 333 Salinas Street Salinas, CA 93901 Whitman F. Manley Remy Moose Manley LLP P. 0. Box 2510 Sacramento, CA 95814 Clerk of the Court Monterey County Superior Court 1200 Aguajito Road Monterey, CA 93940 (for delivery to the Hon. Lydia M. Villarreal) Attorneys for Appellant Marina Coast Water District Telephone: (831 ) 424-1414 Attorneys for Appellant Marina Coast Water District Telephone: (916) 443-2745

( X ) by uploading a text-searchable PDF version of the document, identical to the paper copy, to the Sixth District Court of Appeal website , thus satisfying service on the California Supreme Court, in compliance with California Rules of Court, rule 8.212(c)(2).

Executed and mailed on January 7, 2013 , at Monterey, California. I declare under penalty of perjury under the laws of the State of California that the above is true and correct.

Rachael Mache

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