VMT Tries Changing Horses in Mid-Stream
The California Environmental Quality Act is intended to make responsible agencies stop and think about the full range of environmental consequences before approving projects, and consider alternatives and mitigations.  The process requires the circulation of a draft Environmental Impact Report for comment by the public and regulatory agencies, and the final document responds to those comments.  A local agency can still vote to approve projects in spite of remaining significant environmental impacts with a finding of overriding considerations.

The Vallejo City Council voted to approve the preparation of an EIR to evaluate the VMT/Orcem proposal on April  8, 2014.  The consent calendar item authorized the city manager to engage a consulting firm to prepare the document and negotiate with VMT and Orcem to reimburse the City for the cost.   The staff report for Consent Item F begins with a background discussion:
On September 4, 2013, Vallejo Marine Terminal, LLC (“VMT”) and Orcem California, Inc. (“Orcem”) submitted two separate applications for a Major Use Permit and Site Development Permit to establish a marine terminal and processing facility for the production of high-performing “green” cement material (the “Project") on a site formerly occupied by a General Mills production facility.  A Master Environmental impact Report (EIR) under the California Environmental Quality Act (CEQA) has been identified as the appropriate environmental document based on the multi-phase nature of these projects, the proposed operating characteristics of the site where the Orcem Project is highly dependent on the Project for transporting raw materials, and the number of state and federal regulatory agencies with permitting authority over the site.”
The choice of a Master or Program EIR as the appropriate vehicle, as opposed to a project-level EIR, proved an even better call than it seemed at the time because of one of those state regulatory agencies mentioned, but that isn’t what ultimately was presented to the public.  The draft EIR that circulated for public review and comment instead described an international break bulk port operation with a slag cement mill as a single two-component project.  The applicants now want to change the project but continue on with the process as though a scaled-back final version of the circulated project level EIR can somehow substitute for the Master EIR that was needed and authorized.  In practice the document the public reviewed and commented on extensively can no longer serve in either role to fulfill the purposes of CEQA.
The Bay Conservation and Development Commission is a state planning and regulatory agency with regional authority over the Bay’s shoreline band.   Our city council was told when they voted to amend the lease for the waterfront trust land that because General Mills had used the south Vallejo site as a shipping terminal, the VMT port component of this project would not even need discretionary approval for a major use permit.  In truth, the Bay Plan under the BCDC reserves the site for water-related industry which imports materials for on-site processing and distribution.  That designation does not allow a permit for the port operation to import and export break bulk goods described as the main component of the VMT/Orcem project in the draft EIR that circulated for public comment and in the application for a Major Use permit from the City.
The Bay Conservation and Development Commission was created in 1965 and is the nation’s oldest coastal zone agency.
Communications between the applicant’s consultants, the City, and the BCDC staff reveal the extent of the dilemma created by misinterpreting Bay Plan use classifications and forgoing a Master EIR.  A consultant for the applicants announced their intention to drop the marine terminal port operation in a June 2, 2016 letter:
Elimination of the VMT Phase 2 project component serves to avoid further speculative assumptions in the City’s final CEQA document with respect to the BCDC Permit process for confirming VMT Phase 2 consistency with applicable Bay Plan policies.  As stated in the BCDC letter of 4/29/16, “Commission staff believes that the project sponsors could submit a Phase l project proposal, including proposed interim uses, that is potentially consistent with the Commission's site designation for a ‘water-related industry’ and related policies (of the San Francisco Bay Plan), and that an amendment to the Bay Plan is not needed in order to consider the proposed development of Phase I.”
That reference to proposed interim uses highlights the need for a different type of EIR to evaluate this significantly revised project.  The BCDC staff said they have found instances where a nonconforming use - in this case the port operation - has been allowed for a temporary period of five to ten years.  The applicant’s economic impact study says that the Orcem cement mill, which would qualify as water-related industry, would only utilize a third of the developed capacity.  The applicants have indicated to the BCDC that they would need the interim port use while they recruit additional water-related industrial tenants for the remainder of the sixty-six year lease.  This new set of circumstances guarantees a project that would be built in stages over time.  Among the classes of projects identified in the government public resources code for which a Master EIR would be appropriate:  “A project that consists of smaller individual projects which will be carried out in phases.”
In keeping with the purposes of CEQA, the code specifies that “a Master EIR shall, to the greatest extent feasible, evaluate the cumulative impacts, growth inducing impacts, and irreversible significant effects on the environment of subsequent projects.”  The public received none of that information.  The draft VMT/Orcem project EIR circulated for comment treats the port function as a permanent use instead, and one essential to meeting the stated project objectives.  The revelation that the project can now only meet its stated objectives for a small fraction of the lease term, and that unidentified and unmentioned industrial tenants would occupy the site for the remainder, renders the circulated draft wholly inadequate as a project EIR.  A revised and shrunken final version of the circulated document that attempts to now stand in place of the Master or Program EIR that should have been developed will suffer the same fatal flaw. 
The applicants submitted an application to the City for a major use permit to develop a marine terminal port facility "primarily servicing the import and export of bulk and break-bulk commodities."  The EIR project description presented for public review no longer applies if the applicants now simply abandon VMT Phase 2.  That circulated draft EIR says nothing at all about impacts from subsequent water-related industrial projects that will be needed by the applicants to remain economically viable once the temporary port use ends.  The process that unfolded over the past couple years has fundamentally failed to meet the purposes of CEQA to fully inform decision makers and the public about the environmental consequences of this project.
A recent Appeals Court decision from Sebastopol confirms that a City Council is on solid legal ground in requiring circulation of a revised draft EIR when applicants change a project after the public comment period ends.  There the council twice required the circulation of a new draft EIR over a period of years, as the applicants continued to tinker with the project after circulating a draft for comment.  After the second such action the applicants sued to compel the City to certify a proposed EIR, even though the Sebastopol council had decided that the pending draft EIR required yet another round of circulation to address project modifications.  The court sided with the City and noted that environmental review is often a lengthy process.  The opinion opens by stating that “frustration is not enough to justify premature judicial action that would short-circuit the decision-making process intended by CEQA.”  (Schellinger Brothers v. City of Sebastopol, 2009).
Vallejo would be best served by resuming the public planning process for this site that was put on hold while this abortive environmental review process drags out.  The applicants have established no vested rights to reestablish heavy industrial use of the site by virtue of their permit applications under the legacy zoning.  Neither does the sum of money spent on a botched CEQA process they have been complicit in conducting and delaying earn them any preferential consideration.  A zoning change to a less intensive use would not deprive the owners of significant economic value of the property, which would require reimbursement by the City.  In short, it is well within the City's power to change the zoning to a more appropriate and less intensive use.  Benicia worked with the BCDC to develop a Special Area Plan for their waterfront decades ago that converted property slated for port and industrial use to recreational uses, water-oriented commercial development, and a marina.
Vallejo's legacy intensive use zoning that would permit polluting heavy industry no longer belongs on the south Vallejo waterfront.  Decades of  development in south Vallejo and the surrounding area means we'd put too many vulnerable residents at additional risk by adding more heavy industry today, and there are higher and better uses for our waterfront.  Cities are supposed to periodically revisit and update their General Plans as they mature and conditions change.  The VMT principals would be well advised to go back to the drawing board and this time recruit development partners for a mixed use project more along the lines of the one planned by the previous owners before the economy collapsed.  If they have no interest in such a project they can always sell the property to someone who does at a substantial profit over the price they paid for it in foreclosure.
The Sperry Landing mixed-use development planned for the abandoned General Mills site in 2008 - just prior to the economic collapse.  Conditions in the financial sector have since markedly improved, and a project like this would contribute far more to the local economy while fostering the preferred public planning scenario for a connected waterfront from the Maritime campus to the downtown. 
The business objective of the Sperry Landing project was "to redevelop the Fee Lands as residential town homes, convert the Mill Building to lofts and redevelop the waterfront area (Leasehold) as a park/open space.  The redevelopment project will ... consist of a diverse mix of about 370 residential units.  The redevelopment will integrate existing structures with progressive new construction to create  live-work area and will potentially have ancillary commercial and retail uses."
An Ecocem Slag Milling 'Green' Cement Plant in Europe.  Orcem Americas is a subsidiary of Ecocem, based in Dublin, Ireland.  Which would you rather see on our south Vallejo waterfront at the mouth of the Napa River?