The Montecito Water District relied on a mitigated negative declaration to approve a project to cover the Ortega Reservoir with an aluminum roof. Petitioners argued that the MND did not address evidence from the District’s own consultants that the project’s plan to retain runoff at the site could have a significant environmental impact: The excess runoff could flow into the reservoir, causing contamination of the drinking water, or if the excess was prevented from flowing into the reservoir, dam failure might result.
The Court of Appeal agreed that substantial evidence in the record supported a fair argument that the project could have a significant environmental impact on the environment. In the end, the District prepared an EIR, which allowed the development of a project alternative with more effective mitigation measures that resolved the adverse impacts, and the reservoir cover project was able to proceed.