From Permits to Penalties: A Deep Dive Into Coastal Development Law

The California Coastal Act (The Act) is a critical piece of legislation impacting countless developers and homeowners within the coastal zones of California. Understanding the intricacies of The Act is pivotal for anyone engaged in coastal property or development.

In the latest episode of Digging Into Land Use Law, John Erskine and Patrick Richard explore the challenges faced by developers and homeowners under The Act. John and Patrick discuss the permitting process, the broad definition of “development,” enforcement actions with significant penalties and hot-button issues like seawalls. With practical tips on navigating regulations and responding to violations, this episode, part of a new series on The Act, is a must-listen for anyone involved in coastal zone property or development.

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Transcript: From Permits to Penalties: A Deep Dive Into Coastal Development Law

_{0:00:03.6 Patrick Richard: Since Californians passed Prop 20 in 1972 and the legislature passed the Coastal Act in 1976, which made the Coastal Commission a permanent agency with broad authority, anyone seeking to undertake development in the coastal zone needs to understand the requirements of the Act and the regulations and the penalties for failing to do so.}

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_{0:00:31.5 Speaker 2: Welcome to Digging Into Land Use Law, Nossaman's podcast covering the development of all things in, on, or above the ground.}

_{0:00:47.9 PR: Welcome to Digging Into Land Use Law. I'm Patrick Richard, a partner in our San Francisco office specializing in civil litigation and dispute resolution. Today I have with me my colleague John Erskine, one of the preeminent land use and coastal lawyers in the state. John, why don't we start with you telling me a little bit about yourself?}

_{0:01:09.8 John Erskine: Sure, Patrick. Thanks a lot. I had a background in government, worked for a couple of Orange County supervisors in the late 70s, early 80s. I actually got appointed as a full-time alternate on the then South Coast Regional Coastal Commission while I was going to law school, became a land use lawyer, joined this firm, joined Nossaman in 1989, and immediately started representing property owners and developers in the coastal zone. And I've been a land use and coastal lawyer since that time, the last 35 years.}

_{0:02:00.2 PR: Okay. Well, let's get right to it. Let me ask you, if I'm a property owner, a developer, or maybe someone looking to buy property to develop near the coast in California, when should I be thinking about the California Coastal Commission and their permit process?}

_{0:02:19.2 JE: You should be thinking about it if you know or find out from your local government, assuming that you are planning to do something with the property, either renovate it, remodel it, demolish it, you should know where the coastal zone is. So the coastal zone is basically 1,000 yards inland from the mean high tide line, although that varies. The coastline is 1,100 miles. The Coastal Commission has jurisdiction over that entire 1,100 miles. The jurisdiction extends out three miles off the beach, and it goes inland further than 1,000 yards in some cases. So if you're in the coastal zone, you're gonna need to think about getting a permit not only from the local government for whatever you want to do, but a permit from the Coastal Commission.}

_{0:03:18.7 PR: Well, let me ask you, you gave us some examples. Surely not everything that I want to do at my home, if I just want to renovate a little bit, stuff that's already there, that's not development, is it?}

_{0:03:38.0 JE: It can be. The definition of development, which is in the Coastal Act, it's 30106 of the Public Resources Code, is one of the broadest definitions of development that exists. It includes anything you want to do in terms of construction, renovation, demolition, dredging, modifying property lines, subdividing property. Anything in the coastal zone that would change the overall density or intensity of the use of the property needs to get either a coastal development permit or a waiver or an exemption from the coastal development permit process. In some cases, the local city or the county has what's called a certified local coastal program. And in that case, you go to the coastal city or county to get a permit or a waiver of permit or an exemption. But that's subject in many cases to appeals. And the appeals can be filed by two members of the Coastal Commission or aggrieved environmental activists or others in the area. And then you have a subsequent appeal hearing before the full 12-member Coastal Commission.}

_{0:05:16.6 PR: Wow, that sounds involved. What if I'm buying a property, a home or some other property that has some outbuildings on it? If the building's already there, could I get hit for violating this development rule if it's already built?}

_{0:05:35.4 JE: Yes, you could. The Coastal Act, as you mentioned in the intro, came into being in 1976, effective January 1, 1977. So in some cases, if the outbuilding you're describing in your example was developed prior to the Coastal Act's effective date, you may be able to keep it. But if you modify that outbuilding, or the outbuilding was built after '77 without a permit, then you absolutely are gonna have to deal with again the local coastal jurisdiction, the city or county, and potentially on appeal with the 12 members of the commission in order to get approval to do anything with that outbuilding or to accomplish what's called an after-the-fact permit process.}

_{0:06:41.9 PR: Before we get into some of those procedural issues, you mentioned appeal, etc., I wanted to ask you about something that has been in the news and up and down the coast, and that has to do with seawalls and people either wanting to repair an existing seawall or build a seawall to protect their home, their yard, other infrastructure. What are some of the concerns one should have about either building a seawall or repairing an existing seawall?}

_{0:07:14.5 JE: Great question. Seawalls are an area of great controversy because most of the Coastal commissioners, certainly the Coastal Commission staff and many of the environmental activists, whether it's Surfrider Foundation, Audubon Society, others, Coastkeeper, have an antipathy towards shoreline protection of all forms. The struggle, though, is that when the Coastal Act was passed back in '76, there was... And by the way, the Coastal Act passed by one vote. It was a different kind of legislature, as we both know, back in 1976, the Coastal Act was somewhat controversial. And so there were a lot of protections put in for property owners, including people on the beach or bayfront. So Section 30235 of the Public Resources Code, or the Coastal Act, 30235 deals with revetments, breakwaters, seawalls, other shoreline protective devices, as they're called, and says that they shall be permitted when required to serve coastal dependent uses or to protect existing structures. So that's the controversy. The Coastal Act provides for seawalls. The commission doesn't want them anymore. The activists who are focused more on maintaining surf breaks and the such don't want them. And so there's a constant struggle to limit the use of seawalls and other forms of shoreline protection.}

_{0:09:13.0 PR: Wow, great overview. Thank you. So what if I engage in development or I buy a home and, unbeknownst to me, there's buildings that were unpermitted, and I get hit with something called a notice of violation or a letter threatening penalties? What should I be doing at that point?}

_{0:09:38.6 JE: Well, at that point, you ought to be checking your bank account because you're gonna be paying some lawyer, hopefully an experienced coastal lawyer, and then probably someone like yourself, because there's very little recourse unless you've got super good facts, you've got a good history of the property, you can prove that the alleged unpermitted development or whatever the violation is alleged to be, particularly if it's what we call an access violation and we can get into more detail on the types of Coastal Act violations but assuming you have unpermitted development or alleged unpermitted development that is blocking coastal access, you can stand to face fines upwards of $11,150 a day. And the state legislature gave the Coastal Commission the authority to levy these types of fines administratively through a very limited administrative process limited in the sense of, and we'll talk about that in a minute, but limited in the sense of due process protections. So you're gonna need to have a coastal lawyer, coastal expert, and then you're gonna need an experienced trial lawyer because of the nature of the negotiations over the violations. And I would probably at this point ask you, since you've worked with me and others in our firm on enforcement actions, what you would recommend in terms of how to prepare for that kind of enforcement action?}

_{0:11:40.0 PR: Well, I was told that I simply had to ask questions today, but I will answer that one. And that is, first, if you can try to resolve it, and that's negotiating from a position of strength and information is your best bet. So one, yeah, work with a coastal expert, because just in this short conversation, you've tossed out various regulations and aspects of the act and nuances. But two, what you learn from doing the trial work on these things is you need to build your best evidentiary record. You can do that in a number of ways. You can serve a Public Records Act request. You can hire a historical expert. You can have your own folks go down to the planning department to pull all the old permits. Building a factual record with the assumption that if you need to go to a hearing, if you're unable to resolve it with staff and you need to go to a hearing with the full commission, they are not equipped to be an independent fact finder. They will generally follow the recommendations of staff. They're not there to review the evidence in detail like a judge would or a lot of other administrative agencies that have an independent hearing officer make judicial determinations.}

_{0:13:11.0 PR: So the best working assumption, if you're in a dispute situation that you cannot resolve, you need to assume that you're gonna end up in court and that you need to have created the best administrative record possible because then that becomes your record with the court. You also need to be aware of and we can touch on this perhaps in our next podcast in greater detail there is a body of law, a growing body of law on due process violations by the Coastal Commission arising out of the Nollan/Dolan line of cases, and being familiar with those upfront so you can build a record that draws you into those standards is also important. So that would be my overall advice, John, is matching up a coastal expert with a civil litigation expert.}

_{0:14:09.3 JE: So one of the things that perhaps I skipped over, but assuming we've got time, the administrative civil penalty and fining provision that I mentioned that was passed by the legislature and authorized the Coastal Commission to pursue that without going to court, pursue these major fines and I think I mentioned earlier, they can be $11,150 a day. They have assessed against both individual beachfront property owners and homeowner associations fines upwards of five, six million dollars. There is a provision that allows for these penalties to not be assessed if the property owner corrects the violation consistent with the Coastal Act provisions within 30 days of receiving written notification of the notice of violation. The problem with that in practice that we've experienced is the notice of violation can often be very vague. It can be unspecific. I think sometimes the Coastal Commission enforcement staff deliberately makes it less than specific. And so then you're in the situation, a property owner's in the situation of trying to uncover evidence that they're not violating the Coastal Act, that they don't have unpermitted development.}

_{0:15:51.8 JE: We find that many homeowners, particularly if they've got a home that, let's say, it predates the Coastal Act, they don't have their permits anymore. So then you gotta go dredging for property assessments, property tax worksheets, and the like to try to find out when certain structures that the commission is alleging are unpermitted were actually constructed. The other part of it is the coastal enforcement staff. And I want to say just parenthetically, we process and work with lots of developers and property owners to process coastal development permits. And the permit staff in general, from San Diego to upwards to Humboldt County we've worked in just about every coastal county coastal staff in general is very good.}

_{0:16:53.2 JE: They work hard. It's, they're under a lot of pressure. It's very complex. And so they're doing the best job they can. I think where, in my experience, where the problem lies is with the enforcement staff. And they've developed this methodology where they put pressure on you to say, "Well, the fines are building. This has taken us three or four months. And if we don't get X, Y, and Z in terms of monetary payments or constructing some new structure or installing electrical vehicle charging stations in one case," which has nothing to do with coastal access, "then we may have to take this to an even higher penalty." And so that in practice is where a lot of excitement and a lot of the controversy about the Coastal Commission has arisen.}

_{0:17:59.1 PR: That's a great summary, John. And it sounds like you're saying what a client told me many years ago: "Patrick, I try to avoid" this was an in-house counsel for a major corporation "I try to avoid litigation at all costs. But if I'm in it, I'm in it to win." And it sounds like you're saying you're better off to avoid the enforcement folks, but if you do get into a donnybrook with them, make sure you have your documents lined up and your arguments ready to go.}

_{0:18:32.6 JE: Absolutely.}

_{0:18:34.1 PR: Well, why don't we leave it there? There's a lot more we can cover, and in our next podcast we can go into greater detail. You mentioned public access. I think that would be a good jumping-off point for our next discussion. I want to thank you and the folks who helped put together this podcast today. And I want to thank our listeners for joining us for this episode of Digging Into Land Use Law. For additional information on this topic or other environmental and land use matters, please visit our website at nossaman.com. And don't forget to subscribe to Digging Into Land Use Law wherever you listen to podcasts so you don't miss an episode. Until next time.}

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_{0:19:25.9 S2: Digging Into Land Use Law is presented by Nossaman LLP and cannot be copied or rebroadcast without consent. Content reflects the personal views and opinions of the participants. The information provided in this podcast is for informational purposes only, is not intended as legal advice, and does not create an attorney-client relationship. Listeners should not act solely upon this information without seeking professional legal counsel.}