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Ordinance Number 1116 URGENCY ORDINANCE NO. 1116 AN INTERIM ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN JUAN CAPISTRANO PROHIBITING NEW COMMERCIAL BATTERY ENERGY STORAGE SYSTEMS WITHIN THE CITY OF SAN JUAN CAPISTRANO, ADOPTED AS AN URGENCY MEASURE; AND FINDING THE ACTION TO BE EXEMPT FROM CEQA WHEREAS, the City of San Juan Capistrano, California (“City”) is a municipal corporation, duly organized under the constitution and laws of the State of California; and WHEREAS, in general, a Battery Energy Storage Systems (“BESS”) facility collects energy from the grid, stores it, and then discharges that energy later to provide electricity or other grid services when needed, typically at times of high demand; and WHEREAS, Engie North America (“Applicant”) is proposing to construct a BESS facility on land currently owned by Saddleback Church located at the northern end of the city; and WHEREAS, in December 2021, the City received entitlement applications and a letter of intent from the Applicant requesting to establish a BESS facility. The proposed project is located within the Planned Community (“PC”) District zoning designation. The PC District zoning designation allows uses and structures permitted within the city subject to the approval of a Comprehensive Development Plan (“CDP”) consistent with the General Plan, pursuant to San Juan Capistrano Municipal Code (“Municipal Code”) Section 9-3.315(b). In the absence of an approved CDP, the PC District zoning designation allows identified interim uses pursuant to Municipal Code Section 9-3.315(c) subject to the development standards for the Agri-Business District, pursuant to Municipal Code Section 9-3.315(e)(3); and WHEREAS, the Planning Director also has the authority and responsibility to review uses not listed in the Municipal Code and permit such proposed unlisted use if it falls within the purpose and intent of the base district, is of a comparable nature to the principal, accessory, or conditional uses set forth in the base district, is not listed in the base district, and will not be detrimental to property in the vicinity of such use pursuant to Municipal Code Section 9-3.203; and WHEREAS, on April 29, 2022, the Development Services Director determined that a BESS facility cannot be accommodated by an unlisted use determination under Municipal Code Section 9-3.203 as the required findings could not be met. As such, the preparation and approval by the City Council of a CDP would be required to allow the proposed use. Consequently, in September 2022, Saddleback Church submitted a request for the City Council to initiate a Rezone study to establish a CDP that would govern the approximately 161-acre Saddleback Church Rancho Capistrano property; and WHEREAS, the proposed CDP would have identified the uses currently operating on the property (i.e. a church use), uses allowed on the property by the General Plan, Ordinance No. 1116 April 2, 2024 2 and a BESS facility use. On November 1, 2022, the City Council denied the initiation of a Rezone study to create the proposed CDP; and WHEREAS, the City’s current Zoning Regulations do not contain criteria specifically for BESS facilities; and WHEREAS, in 2022, the Governor signed into law Assembly Bill 205 (“AB 205”), which expands the California Energy Commission’s (“CEC”) powerplant siting authority— previously limited to thermal powerplants—to certain renewable energy facilities, including energy storage systems (as defined in Pub. Util. Code section 2835) that are capable of storing 200 Megawatt-hours or more of electrical energy; and WHEREAS, pursuant to AB 205 (as codified at Pub. Res. Code Division 15, Chapter 6.2), an applicant proposing to build a qualifying energy facility may file an “opt- in application for certification” at the CEC and the CEC’s permitting authority over the proposed project is “in lieu of any permit, certificate, or similar document required by a state, local, or regional agency, or federal agency, to the extent permitted by federal law, for those facilities”; and WHEREAS, in reviewing so-called opt-in projects, the CEC functions as the Lead Agency for purposes of California Environmental Quality Act (“CEQA”) review. In certifying an opt-in project, the CEC must make certain findings; and WHEREAS, in early 2023, Applicant informed the City that it has opted to pursue a State approval process through the CEC, as opposed to seeking local approval through the City Council; and WHEREAS, while the Applicant’s proposed project may no longer require local entitlement approvals, there remain significant public safety-related concerns that must be analyzed prior to any BESS project moving forward within San Juan Capistrano, whether at the Saddleback Church site or elsewhere in the community; and WHEREAS, there have been several fires at BESS facilities both in California and nationwide. BESS facilities that use lithium-ion batteries create particularly unique fire and explosion hazards. Lithium-ion batteries are inherently safe and stable but certain conditions elevate the risk of fire such as impacts, puncture, or mechanical damage, overcharging, overheating, and short circuits. The proposed location is near established residential neighborhoods in San Juan Capistrano and downslope of several hundred homes in Laguna Niguel; and WHEREAS, the proposed project is located adjacent to Trabuco Creek, which is an environmentally sensitive watercourse that flows to the ocean. Should a fire occur at the proposed BESS site, fire extinguishing compounds used to combat the fire (either from the ground or air) would have the potential of entering the creek and significantly impairing water quality and native flora and fauna; and WHEREAS, on October 7, 2023, the Governor of California signed into law Senate Bill 38 (“SB 38”), which amends California Public Utilities Code Section 761.3 to address Ordinance No. 1116 April 2, 2024 3 safety concerns with BESS projects. SB 38 requires every BESS facility in California to establish an emergency response and emergency action plan for the facility to protect surrounding residents, neighboring properties, emergency responders, and the environment. The BESS facility owner or operator must coordinate with local emergency management agencies, unified program agencies, and local first responders to develop the plan, and submit the plan to the county and the city where the facility is located; and WHEREAS, SB 38 recognizes the many hazards that BESS facilities create. It provides that the mandated emergency response and action plan may consider responses to potential offsite impacts, such as poor air quality, threats to municipal water supplies and water runoff, and threats to natural waterways. The plan may also include procedures related to shelter-in-place orders and road closure notifications; and WHEREAS, California Government Code Section 65858 provides that, without following the procedures otherwise required prior to the adoption of a zoning ordinance, an urgency measure in the form of an interim ordinance may be adopted by a four-fifths vote of the City Council to protect the public from a current and immediate threat to the public health, safety, or welfare resulting from a contemplated zoning proposal. Government Code Section 65868 further provides that such an urgency measure shall be effective for only 45 days following its adoption, but may be extended beyond the initial 45 day period, following compliance with that Section, for an additional 10 months and 15 days and subsequently for an additional 12 months; and WHEREAS, the potential for development of new commercial BESS facilities within the City of San Juan Capistrano without adequate land use policies and standards in place to implement SB 38 and to prevent potentially catastrophic interference with nearby communities presents a current and immediate threat to the public’s safety and welfare, and the approval of use permits, building permits, or other applicable entitlements for such uses would result in that threat to public safety and welfare; and WHEREAS, while this interim ordinance is in effect, the City intends to study and consider land use development policies and standards related to BESS facilities that should be added to the City’s General Plan and Zoning Regulations. NOW, THEREFORE, the City Council of the City of San Juan Capistrano does ordain as follows: Section 1. The recitals above are each incorporated by reference and adopted as findings by the City Council. Section 2. This interim ordinance is not subject to the CEQA (Public Resources Code §21000, et seq.) pursuant to CEQA Guidelines (Cal. Code Regs., tit. 14, §15000 et seq.) Section 15060(c)(2) [activity will not result in a direct or reasonably foreseeable indirect physical change in the environment]. Here, the interim ordinance will prohibit certain projects from proceeding for a period of time during which the City will study the potential development. As a result, this interim ordinance will not result in a direct or reasonably foreseeable indirect physical change in the environment. Ordinance No. 1116 April 2, 2024 4 Alternatively, this interim ordinance is exempt from CEQA under CEQA Guidelines Sections 15061(b)(3) [it can be seen with certainty that there is no possibility the activity in question may have a significant effect on the environment], and, in the alternative, 15307 [Class 7 categorical exemption for regulatory activity to assure the protection of natural resources], and, in the alternative, 15308 [Class 8 categorical exemption for regulatory activity to assure the protection of the environment]. Here, the interim ordinance will prohibit certain projects from proceeding for a period of time during which the City will study the potential development. This activity is meant to assure the protection of the environment and natural resources by studying the hazards associated with BESS facilities, such as unique fire and explosion hazards, for potential development of zoning regulations for BESS facilities. Alternatively, this interim ordinance is exempt from CEQA pursuant to Public Resources Code Section 21080(b)(4) and CEQA Guidelines Section 15269(c) because it prevents a clear and imminent danger that requires immediate action to prevent or mitigate the loss of, or damage to, life, health, property, and essential public services. Here, the interim ordinance will prohibit certain projects from proceeding for a period of time during which the City will study the potential development. This activity is meant to prevent or mitigate the loss of, or damage to, life, health, property, and essential public services by studying the hazards associated with BESS facilities, such as unique fire and explosion hazards, for potential development of zoning regulations for BESS facilities. Section 3. From and after the date of enactment of the interim ordinance, no use permit, variance, building permit, business license, or any other entitlement for use shall be approved or issued for the establishment, construction, or operation of a commercial BESS facility for any location or property within the City of San Juan Capistrano, unless a use permit was approved prior to April 2, 2024, authorizing the establishment, construction, and operation of the commercial BESS facility, in which case the commercial BESS facility may continue in operation as approved but may not be replaced or modified in any manner that would require revision or amendment to the use permit under the City’s Zoning Regulations. As used in this ordinance, the term “commercial” means the use of a BESS facility to provide electricity to third parties, for consideration. Section 4. This interim ordinance is urgently needed for the immediate preservation of the public health, safety, and welfare based on the findings in this interim ordinance. It shall take effect immediately upon adoption and shall be of no further force and effect 45 days following the date of its adoption, unless earlier repealed by the City Council or extended in accordance with the provisions set forth in California Government Code Section 65858. Section 5. The penalties for land use violations that are prescribed in Section 9- 1.201 of the Municipal Code shall apply to violations of the provisions of this interim ordinance. Section 6. If any provision of this ordinance or its application to any person or circumstance is held to be invalid, such invalidity has no effect on the other provisions or applications of the ordinance that can be given effect without the invalid provision or application, and to this extent, the provisions of this resolution are severable. The City Ordinance No. 1116 April 2, 2024 5 Council declares that it would have adopted this resolution irrespective of the invalidity of any portion thereof. Section 7. The City Council hereby directs staff to prepare, execute, and file with the County of Orange Clerk a notice of exemption within five (5) working days of the adoption of this Ordinance. Section 8. The Custodian of Records for this Ordinance is the City Clerk and the records compromising the administrative record for this Ordinance are located at 32400 Paseo Adelanto, San Juan Capistrano, CA 92675. PASSED, APPROVED AND ADOPTED by the City Council of San Juan Capistrano, California, at a regular meeting of the City Council held on the 2nd day of April, 2024. City of San Juan Capistrano ________________________________ SERGIO FARIAS, MAYOR ATTEST: ________________________________ CHRISTY JAKL, ACTING CITY CLERK STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss. CITY OF SAN JUAN CAPISTRANO ) I, CHRISTY JAKL, Acting City Clerk of the City of San Juan Capistrano, do hereby certify that the foregoing is a true and correct copy of Urgency Ordinance No. 1116 was duly adopted and passed at the Regular Meeting of the City Council on the 2nd day of April 2024 by the following vote, to wit: AYES: COUNCIL MEMBERS: Taylor, Campbell, Hart, Bourne and Mayor Farias NOES COUNCIL MEMBERS: None ABSENT: COUNCIL MEMBERS: None _____________________________________ CHRISTY JAKL, ACTING CITY CLERK Ordinance No. 1116 April 2, 2024 6 STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss AFFIDAVIT OF POSTING CITY OF SAN JUAN CAPISTRANO ) I, CHRISTY JAKL, declare as follows: That I am the duly appointed and qualified City Clerk of the City of San Juan Capistrano; That in compliance with State laws, Government Code section 36933(1) of the State of California, on the 28th day of March 2024, at least 5 days prior to the adoption of the ordinance, I caused to be posted a certified copy of the proposed ordinance entitled: AN INTERIM ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN JUAN CAPISTRANO PROHIBITING NEW COMMERCIAL BATTERY ENERGY STORAGE SYSTEMS WITHIN THE CITY OF SAN JUAN CAPISTRANO, ADOPTED AS AN URGENCY MEASURE; AND FINDING THE ACTION TO BE EXEMPT FROM CEQA This document was posted in the Office of the City Clerk ________________________________ CHRISTY JAKL, ACTING CITY CLERK San Juan Capistrano, California STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss AFFIDAVIT OF POSTING CITY OF SAN JUAN CAPISTRANO ) I, CHRISTY JAKL, declare as follows: That I am the duly appointed and qualified City Clerk of the City of San Juan Capistrano; that in compliance with State laws, Government Code section 36933(1) of the State of California. On the 11th day of March 2024, I caused to be posted a certified copy of Urgency Ordinance No. 1116, adopted by the City Council on April 2, 2024, entitled: AN INTERIM ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN JUAN CAPISTRANO PROHIBITING NEW COMMERCIAL BATTERY ENERGY STORAGE SYSTEMS WITHIN THE CITY OF SAN JUAN CAPISTRANO, ADOPTED AS AN URGENCY MEASURE; AND FINDING THE ACTION TO BE EXEMPT FROM CEQA Ordinance No. 1116 April 2, 2024 7 This document was posted in the Office of the City Clerk ________________________________ CHRISTY JAKL, ACTING CITY CLERK San Juan Capistrano, California