At a glance, last week's California Supreme Court ruling in the Expo Line CEQA case laid down a pretty clear rule: Lead agencies can use a "future baseline" for environmental analysis, but they have to be very careful in documenting the reasons why. L.A. Metro erred in using a "future baseline," but fortunately for the agency the court concluded that it didn't make any difference to the analysis.

A deeper look at Neighbors for Smart Rail v. Exposition Metro Rail Construction Authority, however, reveals a deeply split court that apparently almost went the other way  and that could have significant implications in the future for the way the California Environmental Quality Act unfolds in future court cases. The court split 3-3-1 in the case. Justice Goodwin Liu provided the deciding vote on the future baseline question  but he didn't agree with the plurality decision on the question of whether using the future baseline made any difference in the outcome.

And a close read of the two main opinions  the plurality opinion written by Justice Patricia Werdegar and the main dissent written by Justice Marvin Baxter, both of which got three votes  suggests that Baxter's was originally written as the majority opinion and Werdegar's as the dissent. Baxter's dissent begins with a broad and sweeping description of CEQA  typical of a majority opinion  while Werdegar's plurality contains many refutations of Baxter's points, as a dissent typically does. Had Baxter's reasoning carried the day, lead agencies would have virtually unlimited discretion in deciding what kind of baseline analysis to use.

Why is this important? Because we've entered a new period of CEQA court rulings focused on narrow, technical decisions that have enormous consequences on the size and scope of the analysis.

For the first 20 years after CEQA was passed  from 1972 until 1990  the courts consistently expanded CEQA's scope so that more and more issues had to be analyzed in great technical detail, thus creating ever-expanding environmental analyses. For the next 20 years  after the California Supreme Court's New Year's Eve 1990 ruling in Citizens Of Goleta Valley, v. Board Of Supervisors, 52 Cal.3d 553, 801 P.2d 1161, 276 Cal.Rptr. 410, the courts were much less aggressive in expanding CEQA's scope  largely because Goleta Valley contained a pretty clear warning.

Now, however, we appear to have entered the CEQA's "third wave". The courts are not vastly expanding CEQA's reach, and plaintiffs know better than to push in that direction. Instead, plaintiffs are relying on narrow technical arguments to make their case  mostly about what the ground rules for the analysis are. But while the arguments are narrow and technical, the impact of the rulings is not. For example, in Ballona Wetlands Land Trust v. City of Los Angeles (2011) 201 Cal. App. 4th 455, the Second District Court of Appeal ruled that a project's impacts do not have to be measured against future changing environmental conditions (for example, sea level rise).

Similarly, in last week's Neighbors for Smart Rail v. Exposition Metro Line Construction Authority, the issue was whether or not L.A. Metro erred in the way it created the baseline of analysis for traffic and air quality impacts. For those two issues  but not for others  Metro use a "future baseline" of 2030 without the Expo Line Phase 2 in place, rather than a current baseline.

In a lot of ways, this makes sense. After all, we're not talking about a development project here. We're talking about a transportation project. So, whereas you might be able to analyze a development project against current conditions  assuming that the only change is whether or not the new subdivision is built  the whole point of a transportation project is to change future conditions from what they otherwise would be.

This was persuasive to Justice Baxter and the two judges who agreed with him. TO quote Baxter at some length:

"As a major infrastructure project designed specifically to address projected long-term increases in traffic congestion and air pollution, Expo Phase 2's very operation will, over time, achieve environmental objectives and efficiencies in complete alignment with CEQA's goals of enhancing and protecting the environment in this state. The majority does not disagree that the traffic and air quality conditions in 2007 will no longer exist when Expo Phase 2 is fully operational. But despite Expo Authority's reliance on this reality as a justification for omitting an impacts analysis based on the 2007 conditions, the majority proceeds to fault the agency for failing to analyze the conditions projected to exist eight years after that date, when Expo Phase 2 is scheduled to begin operations in 2015.

"The unfairness of today's decision is stunning: the majority finds an abuse of discretion based on the lead agency's failure to use a baseline that is nowhere mentioned in the CEQA statutes, regulations, or case law, and that no agency or member of the public ever advocated in the administrative review process below."

But it wasn't persuasive to the majority. Quoting Werdegar's opinion  which got four votes: "Projected future conditions may be used as the sole baseline for impacts analysis if their use in place of measured existing conditionsa departure from the norm stated in Guidelines section 15125(a)is justified by unusual aspects of the project or the surrounding conditions.

"That the future conditions analysis would be informative is insufficient, but an agency does have discretion to completely omit an analysis of impacts on existing conditions when inclusion of such an analysis would detract from an EIR's effectiveness as an informational document, either because an analysis based on existing conditions would be uninformative or because it would be misleading to decision makers and the public."

This last bit of reasoning  that existing conditions can only be omitted if uninformative or misleading  appeared to be especially infuriating to Baxter. "It is unclear," he wrote, "how an agency might show that an existing conditions analysis would be "uninformative" or "misleading," without actually conducting such an analysis."

Baxter concludes that the majority's decision will increase the complexity of CEQA analysis significantly and will lead to further conclusion and delay for both public and private projects in California. He may well be right. One can't help but notice that Baxter's reasoning is pretty clean and simple, while Werdegar's  while not tortured  is nevertheless complicated. As Baxter says, it's hard to know exactly how to follow the bouncing ball.

When CEQA's critics complain that the law is unnecessarily complicated, this is the kind of thing they're talking about. At its core, the question in the Expo Line CEQA analysis is simple: Will the construction of a major light-rail line benefit the environment or harm it? The Neighbors for Smart Rail ruling deals with the question of "compared to what"  and provides, , unfortunately, a rule that gives CEQA critics even more ammunition when they say the law is unnecessarily complicated.