Citing inadequate wildfire plans, Lake County judge deals setback to Guenoc Valley resort development

A judge has issued a blow to the developers of a proposed sprawling luxury resort and housing project in southeastern Lake County, ruling that the environmental impact report for the 25-square-mile development inadequately addresses wildfire impacts and evacuation safety.

The Jan. 4 ruling by Superior Court Judge J. David Markham is also a setback for elected officials who hoped the Guenoc Valley project would be an economic development boon for the struggling county, one of California’s poorest.

“If the ultimate result of this decision is the project not moving forward, that will be a tremendous loss,” south Lake County Supervisor Moke Simon said Thursday.

California Attorney General Rob Bonta is counting the decision as a win for the public.

The lawsuit was a result in part of a strategy unveiled by his predecessor to ensure greater scrutiny of development proposals in fire-prone areas through more aggressive intervention by the Department of Justice in environmental lawsuits.

The ruling “affirms a basic fact: Local governments and developers have a responsibility to take a hard look at projects that exacerbate wildfire risk and endanger our communities,” Bonta said in statement Thursday. “We can't keep making shortsighted land use decisions that will have impacts decades down the line. We must build responsibly.”

The proposal at the center of the debate is loaded with glittery appeal: a unique, ultraluxury Wine Country resort and sustainable, master-planned residential community with 1,400 estate villas and five boutique hotels with a total of 850 rooms, and resort apartments. Plans also include a golf course, polo fields, equestrian center, spa and wellness facilities, and mixed commercial uses developed around the farm built by famed 19th-century British actor Lillie Langtry, though her farmstead and nearby winery aren’t actually included in the project.

Lotusland Investment Holdings Inc., the international consortium behind the project, says it intends to create “a world class resort destination,” but one that honors the land, letting “nature take center stage” and leaving more than 90% of the landscape undeveloped.

But what developers view as the perfect spot for their new project has been overrun repeatedly by catastrophic wildfires since the landmark Valley fire in 2015, which ripped across 18 miles in a 12 hours and eventually torched 120 squares miles of land, destroying 2,000 structures, including 1,281 homes.

Most recently, a large part of the 16,000-acre site burned during the lightning-sparked LNU Complex fire, which scarred 363,220 acres beginning Aug. 17, 2020.

The developers took that history into account when designing the project, building in exterior sprinkler systems, underground utilities, fire breaks, an on-site fire station and helipad, and said the area would be safer than it is now.

But wildfire concerns were among the items cited in a 2020 lawsuit filed by the nonprofit Center for Biological Diversity against the project and against Lake County supervisors, who certified the project environmental impact report.

The Attorney General’s Office joined the case last year, saying the environmental impact report approved for the project failed fully to account for increased potential for greenhouse gas production and wildfire ignition, as well as emergency evacuation.

“Lake County residents have borne the brunt of many of the recent wildfires that have ravaged our state,” then-Attorney General Xavier Becerra said. “They deserve to know that the increased wildfire risks resulting from any new development in their area have been properly considered — and mitigated.”

In his ruling, Markham rejected many criticisms raised against the environmental report in the initial lawsuit.

But he found that the addition of an estimated 4,070 residents east of Middletown, stretching to the Napa County line, would complicate emergency evacuation efforts in the rural area and that the necessary analysis was not present in the environmental review certified by Lake County supervisors.

Evacuation routes are few in pastoral area and would be shared by an estimated 10,163 in the two census tracts the project crosses, the judge wrote. That would have the potential to put panicked residents trying to flee a wildfire on congested roads at risk of injury and even death, which has occurred in recent fires, including Paradise.

The report “primarily addresses the issue of whether the Project’s residents could safely leave the Project in the event of a wildfire,” Markham wrote. “This evidence does not focus on the issue that is required to be addressed by CEQA (the California Environmental Quality Act); whether evacuation of the residents in the nearby area would be affected by the evacuation of the Project’s residents during a wildfire.”

Peter Broderick, an attorney for the Center for Biological Diversity, said Markham “recognized that Lake County failed in one of its most important jobs, which was to consider how dangerous development in the path of fire can increase risks to surrounding communities.

“Given the fire threats facing California, I hope decision-makers and developers come to see how absolutely crucial it is to consider evacuation challenges when building projects this risky,” he said. “No developer should be allowed to make it harder for people to escape deadly fires.”

After the ruling, Lake County supervisors and Lotusland Investment Holdings, based in San Francisco and Hong Kong, held out hope they could work their way through the judge’s concerns about wildfire safety and see the project through.

“We remain committed to working alongside the Lake County community and fire safety experts to ensure this project is built in the right way to improve wildfire detection, prevention and response throughout the region,” Lotusland partner Chris Meredith said in a statement.

Lake County Supervisor Simon similarly welcomed “future opportunities to partner with Lotusland and others to promote thoughtful development” in the county, but expressed bitter disappointment with the ruling.

“As I have publicly stated on previous occasions, Lotusland had made considerable efforts to mitigate potential environmental concerns, and honor Lake County’s rich Tribal history, in their planning,” he said in a statement. “Their flexibility and engagement made them in many ways an ideal partner.”

You can reach Staff Writer Mary Callahan at 707-521-5249 or mary.callahan@pressdemocrat.com. On Twitter @MaryCallahanB.