Water District Should Have Done An EIR, Not An MND, Before Approving A Project To Cover A Reservoir


In Ocean View Estates Homeowners Association, Inc., v. Montecito Water District, (2004 Daily Journal D.A.R. 2738, Cal. App. 2 Dist., Mar. 2, 2004), the California Court of Appeal, Second Appellate District, considered the issue of whether a water district should have done an Environmental Impact Report (EIR) instead of a Mitigated Negative Declaration (MND) before approving a project to cover a reservoir. For the first time in a reported decision, CEQA was interpreted as protecting from adverse impact the aesthetics of views from private vantage points, in addition to the more usual approach of considering only publicly accessible views. The court also held that the impacts of the mitigation measures, adopted to address potential adverse impacts of the project, had not adequately been considered.


The Ortega Reservoir provides potable water for the Montecito Water District. At the encouragement of the Department of Health Services, Water District decided to cover the four-acre reservoir with an aluminum roof. After an initial study of the project’s environmental impacts and public review and hearing, Water District decided the project would not have significant impacts on aesthetics, because, it concluded, the aluminum cover would not be visible from publicly accessible vantage points. After adopting mitigation measures to deal with the potential for flooding from excess runoff, Water District issued an MND for the project. Ocean View Homeowners Association, a group of homeowners near the reservoir, filed a lawsuit, asking the superior court to direct Water District to vacate its approval of the project. The trial court denied the request and Homeowners appealed.

California Court Of Appeal Decision

An EIR is required whenever there is a “fair argument” that significant environmental impacts may occur. Homeowners argued there is a “fair argument” that the project may have significant negative aesthetic impact, thus requiring an EIR. The Court of Appeal agreed, observing that “[a]ny substantial negative effect of a project on view and other features of beauty could constitute a significant impact under CEQA.” Here, the proposed aluminum roof would extend over four acres and be 15 feet tall at its highest point. While landscaping plans would partially provide a shield, the reservoir and cover would be visible to at least two homes. Although the affected views are from private homes, they must still be considered. Furthermore, there is evidence that the cover would be visible from public trails. Therefore, the Court concluded there is “substantial evidence to support a fair argument that the project may have a significant adverse aesthetic impact.”

Homeowners also argued that an EIR is required because there is a fair argument that the mitigation measure of retaining runoff at the site may have a significant environmental impact. Relying on evidence from Water District’s own engineers who noted the possibility of contamination and dam failure, the Court of Appeal agreed with Homeowners. The Court rejected Water District’s argument that an MND was sufficient because changes in the project design have mitigated to insignificance the potential for contamination and dam failure. According to the Court, the MND did not even identify, let alone discuss, the potential environmental impact, thus thwarting public participation in the review process.

The Court therefore reversed the superior court’s decision and required it to order Water District to vacate its decision certifying the MND.

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