SUBJECT
Title
VEHICLE MILES TRAVELED MITIGATION UPDATES AND RELATED CEQA EXEMPTION (DISTRICTS: ALL)
Body
OVERVIEW
The County of San Diego (County) Board of Supervisors (Board) has taken ongoing actions to align local policies with State of California (State) requirements to address housing production, sustainability, and greenhouse gas (GHG) reduction, including directing options for Vehicle Miles Traveled (VMT) mitigation. Today’s item provides updates on VMT mitigation efforts, shares findings from a Transit Opportunity Area (TOA) assessment, and discusses how this work connects to the Board’s direction on the Sustainable Land Use Framework (Framework), which may support a longer-term solution for VMT mitigation, housing production, and GHG reduction.
In 2013, the State passed Senate Bill (SB) 743, establishing VMT as the standard for evaluating the transportation impacts of development projects under State law. VMT focuses on reducing the number and distance traveled of vehicle trips and replaces the previous Level of Service (LOS) standard, which focused on capacity enhancing roadway improvements, such as road widening, to reduce traffic congestion, especially during peak traffic periods. While the Board has taken steps to implement SB 743, several actions have been challenged in court (see Attachment A). During this time, some groups have noted that VMT mitigation requirements created uncertainty and perceived risk for development, which has affected interest in building in the unincorporated areas.
On February 9, 2022 (7), the Board directed staff to develop options for a VMT mitigation program for the unincorporated area, and to prepare options for the Framework. The Framework is intended to help the County navigate new legislative requirements, such as SB 743, while still ensuring community priorities and development activity are considered through land use planning in the unincorporated area. It will ensure that the County’s 2011 General Plan (the County’s guiding land use document) and land use policies remain compliant with State legislation and aligned with Board and community goals.
Today’s item provides an update on previous VMT-related actions, including the results of the TOA assessment that the Board directed on June 5, 2024 (8). The TOA assessment was intended to identify areas where increased housing densities could help reduce VMT and to explore whether a focused mitigation program could support housing and remove VMT related barriers. However, since that Board direction, case law and resulting legal interpretations have reconfirmed the use of California Environmental Quality Act (CEQA) Guidelines Section 15183 (15183) streamlining. As of July 2024, most General Plan-consistent projects can use 15183 streamlining, which avoids the need to analyze or mitigate for VMT impacts. This change greatly reduced the issue of VMT as a major barrier to development by allowing streamlining under the 2011 General Plan Environmental Impact Report (EIR). While most projects do not require VMT analysis and mitigation, some projects still need to analyze and address VMT mitigation such as certain projects that require a Major Use Permit (propose a more intensive use than what was studied under the General Plan EIR), or projects that propose density changes beyond the General Plan, often referred to as General Plan amendment (GPA) projects.
The original direction in 2024 called for consideration of an Unincorporated Area VMT Mitigation Program to provide mitigation options for projects throughout the unincorporated area. At the time, most development projects needed full VMT studies and often an EIR. Factors such as the clarity on 15183 streamlining have reduced the urgency for an unincorporated area VMT Mitigation Program at this time; however, there is a need to consider such a program as part of longer-term planning efforts as laws around VMT potentially evolve and as a land use planning tool. For efficiency of time and resources, staff will bring forward options addressing this Board direction as part of the Framework return.
However, should the Board wish to provide a near-term pathway for projects still requiring VMT mitigation, there is an option today to direct development of a local VMT Mitigation Exchange Program. A VMT Mitigation Exchange Program could offer mitigation options for the limited number of projects that require it, and could be operationally simple for the County to implement. Implementation of a VMT Mitigation Exchange Program would involve identifying VMT-reducing improvements that project proponents could construct to mitigate VMT impacts. While this type of program would not offer CEQA streamlining, it would offer an option for VMT mitigation that would primarily help projects that require nominal VMT reductions since the improvements would not substantially reduce VMT. Additionally, the cost to developers of implementing the VMT reducing improvements are likely to be high, depending on the improvement. Considering most development qualifies for 15183 streamlining and VMT mitigation is rarely required, today’s item recommends advancing a VMT Mitigation Exchange Program, rather than the options previously introduced at the June 5, 2024 (8) Board hearing.
While circumstances have changed since the TOA assessment was conducted, the analysis results provide important insights that can inform next steps. Broadly, the TOA assessment found that advancing certain land use changes to increase densities in certain areas can expand where development can be considered VMT efficient. Additionally, changes to land use that reduce VMT can bring down mitigation costs. While land use changes may offer some VMT reducing benefit, it is recommended that any land use change be considered as part of a comprehensive evaluation that considers various factors. Looking ahead, it is expected that certain planning efforts, such as land use changes associated with planning for Regional Housing Needs Assessment (RHNA) sites and Community Planning efforts will require analysis of VMT. Future planning efforts and longer-term solutions for VMT will be discussed when staff returns to the Board with Framework options in the next year, and these opportunities can be considered further.
In addition to the TOA assessment update, today’s item will include updates on the San Diego Association of Governments (SANDAG) effort to develop a Regional VMT Mitigation Program in partnership with the County. Today’s update will also consider how the VMT mitigation program being developed at the State level could be used locally, including highlighting the opportunity for VMT mitigation programs to provide a source of funding for affordable housing.
RECOMMENDATION(S)
CHIEF ADMINISTRATIVE OFFICER
Planning & Development Services recommends that the Board of Supervisors (Board):
1. Find that the proposed actions are not subject to the California Environmental Quality Act (CEQA) because they are not a project as defined in Section 15378(b)(5) of CEQA guidelines.
2. Receive the Transit Opportunity Area (TOA) Assessment Report (Attachment B).
3. Direct staff to:
a. Continue to work with the San Diego Association of Governments on the Regional Vehicle Miles Traveled (VMT) Mitigation Program and explore opportunities for grant funding for a pilot program.
b. If directing 3.a., pursuant to Board Policy B-29, authorize the Director, Department of Planning & Development Services, or his/her designee, to submit grant applications and accept grant funds related to the Regional VMT Mitigation Program and waive Board Policy B-29, Fees, Grants, Revenue Contracts - Department Responsibility for Cost Recovery, which requires full cost recovery for services provided under grants.
c. Consider TOAs and land use changes as part of the Sustainable Land Use Framework at a future hearing.
4. Provide direction to staff on whether to pursue development of a local VMT Mitigation Exchange program.
EQUITY IMPACT STATEMENT
Vehicle Miles Traveled (VMT) mitigation can support reductions in environmental and health impacts within the unincorporated areas associated with transportation, including noise, air pollution and safety, and help accomplish the goals of Senate Bill (SB) 743 to balance the needs of congestion management with goals related to infill development, promotion of public health, and reduction of greenhouse gas emissions that cause climate change.
SUSTAINABILITY IMPACT STATEMENT
Reducing Vehicle Miles Traveled (VMT) and greenhouse gas (GHG) emissions in the unincorporated area helps meet the State and County climate, health, and mobility goals by implementing Senate Bill (SB) 743. Initiatives that advance implementation of SB 743 will support the County’s Strategic Initiatives, State, and other regional policy efforts to ensure that communities grow and evolve in a healthy, resilient, and equitable way by prioritizing decarbonization, sustainable development and housing for all, conservation, social and health equity, and environmental justice. Reducing VMT contributes to the County’s Sustainability Goal No. 3 to reduce GHG emissions and prepare for impacts of a changing climate.
FISCAL IMPACT
There is no fiscal impact associated with the actions taken today. Funds are included in Fiscal Year (FY) 2026-27 Operational Plan in Planning & Development Services (PDS) for the development of a Vehicle Miles Traveled (VMT) Mitigation Program and the development of the Sustainable Land Use Framework. The funding source is available, prior-year General Fund fund balance allocated for the VMT Mitigation Program and the Sustainable Land Use Framework. There will be no change in net General Fund costs and no additional staff years.
BUSINESS IMPACT STATEMENT
N/A
Details
ADVISORY BOARD STATEMENT
N/A
BACKGROUND
In 2013, the State of California (State) enacted Senate Bill (SB) 743, replacing Level of Service (LOS), which measured roadway congestion and vehicle delay, with Vehicle Miles Traveled (VMT), which measures the total distance vehicles travel, as the new metric for evaluating transportation impacts under the California Environmental Quality Act (CEQA) to better align transportation analysis with climate and land use goals. Since SB 743 took effect statewide on July 1, 2020, the County of San Diego (County) Board of Supervisors (Board) has been working to align local policies and regulations with the State's direction.
Integration of VMT into County procedures and processes has encountered challenges. Staff developed Transportation Study Guidelines (TSG) that established thresholds of significance and provided processes for applicants to use when preparing transportation analyses for projects in the unincorporated area using VMT. Since the original adoption of the TSG in 2020, it has been the subject of legal challenges and court decisions regarding the County’s VMT screening criteria and VMT threshold (a standard used to determine whether a project’s generated car travel distance causes a significant environmental impact). Most notably, the County’s infill areas and small-project exemptions were challenged and have been eliminated from the current TSG. Additionally, in consideration of litigation and guidance from the Governor's Office of Land Use and Climate Innovation (LCI) (previously named the Office of Planning and Research), the County updated its VMT threshold to be based on a regional average instead of the unincorporated area average, which resulted in a threshold that is very hard to achieve for most unincorporated area communities. For more information on the County’s history of implementing VMT, see Attachment A.
Following recent case law and legal guidance, as of July 2024, the County reconfirmed the use of CEQA Guidelines Section 15183 (15183) streamlining for General Plan consistent projects under the 2011 General Plan Environmental Impact Report (EIR). This change effectively removed VMT as a major barrier for development in the unincorporated area because qualified projects can proceed with LOS as the metric to determine impacts without VMT analysis or mitigation. Since 15183 streamlining applies to General Plan consistent projects and most development in the unincorporated area is in alignment with the General Plan, a VMT mitigation program would not be widely used at this time. However, there are some instances of projects that would require VMT mitigation such as General Plan amendment projects or other projects that cannot rely on the 2011 General Plan EIR, such as Major Use Permits.
Previous Board Direction
On June 5, 2024 (8), Board directed staff to evaluate the following County VMT mitigation program options including:
1. An Unincorporated Area Mitigation Program
a. Including an additional option for a VMT Mitigation Program within the General Plan Village areas.
2. A Regional and/or Partnership Mitigation Program
3. A Focused Transit Opportunity Area (TOA) Mitigation Program (No Land Use Changes)
4. A Focused TOA Mitigation Program (Including Potential Changes to Land Use Densities)
The Board also asked the County to continue to work with project applicants to review projects on a case-by-case basis to determine applicability of 15183 exemption process, which is occurring.
An Unincorporated Area VMT Mitigation Program
While there ultimately will be a need to transition from LOS to VMT as the appropriate metric for transportation analysis in the General Plan (i.e., re-analyze the General Plan land uses based on VMT as the metric) along with providing VMT mitigation options for unincorporated areas, advancing a stand-alone Unincorporated Area Mitigation Program at this time would not provide substantial benefits. With recent case law and legal guidance, most development does not require VMT mitigation and may rely on the 15183 streamlining as a pathway for CEQA compliance for General Plan consistent projects. Considering the changed circumstances since the original Board direction, a standalone VMT mitigation program, whether for the unincorporated area or just the Villages, is not recommended at this time. A comprehensive approach to VMT mitigation would be best considered in a more coordinated approach that considers opportunities for land use changes that support VMT reductions, as discussed under the TOA discussion below. A long-term solution for VMT mitigation can be explored as part of the ongoing efforts of the Sustainable Land Use Framework (Framework) in order to allow for efficiency of resources and broader consideration of how land use changes can support VMT reductions and key planning efforts, like the next Housing Element cycle.
Local VMT Mitigation Exchange Program
A short-term solution to advance a VMT mitigation strategy for projects in the unincorporated area that do require mitigation for transportation impacts could involve the creation of a local VMT Mitigation Exchange Program. This type of program would offer an option for VMT mitigation that could be implemented with minimal operational costs to the County in the short term. It would let applicants fund or construct specific projects that reduce VMT, one project at a time, within the unincorporated area. This structure is flexible, easy to implement, and allows the County to provide an option for VMT mitigation while broader planning work continues. Given that the majority of projects are consistent with the County’s General Plan and zoning requirements, very few require VMT mitigation. Consequently, a local VMT mitigation program would likely experience minimal, if any, utilization.
Developers constructing land development and transportation projects within the unincorporated area would be able to browse and use a program database to identify potential mitigation projects to offset VMT-related environmental impacts. Significant challenges do exist with the rural and semi-rural nature of the unincorporated area related to the amount of VMT needed to be reduced and the limited VMT-reducing infrastructure available. As such, a local program intended to fully mitigate for VMT in the unincorporated area may not be very effective for many projects, and it is not anticipated this program would be widely used. However, this option would provide a VMT mitigation tool that does not exist today and would help the County better understand which types of VMT-reducing improvements are most effective in practice. Additionally, this program could be set up by the County with minimal cost and effort. If directed, staff can implement the program within one year. A local VMT mitigation exchange program could also be used as part of the regional mitigation program with SANDAG.
A Regional and/or Partnership Mitigation Program:
San Diego Association of Governments Regional VMT Mitigation Program
The San Diego Association of Governments (SANDAG) and the County received a California Department of Transportation (Caltrans) Strategic Partnership grant to develop a Regional VMT Mitigation Program for the San Diego region. The Regional VMT Mitigation Program set out to explore mitigation options based on regional resources and infrastructure by contributing to the funding and implementation of SANDAG’s Regional Plan. It included the formation of a technical advisory committee made up of SANDAG member agencies, the County, Caltrans, and regional transit agencies. After multiple mitigation programs were evaluated, the technical advisory committee voted to proceed with developing a hybrid program consisting of a regional credit/banking program, a regional exchange program, and the development of local in-lieu fee guidelines. The hybrid program will provide tools for use by local agencies but does not require mandatory participation. The Regional VMT Mitigation Program is expected to be presented to the SANDAG Board of Directors in the summer of 2026.
The Board could consider initially using the Regional VMT Mitigation Program as a local, unincorporated area-only program in partnership with SANDAG. A regional program with other participating jurisdictions would include funding infrastructure improvements in other jurisdictions, which would then allow for more opportunities to reduce VMT and facilitate development within the unincorporated area. As the program is further developed and evolves to include participation with other jurisdictions, the County will be able to evaluate the benefits of working in a regional partnership with outside jurisdictions that may have an excess capacity of unfunded, VMT-reducing infrastructure. Participation in the Regional VMT Mitigation Program can continue to be evaluated and assessed with respect to the costs and benefits to the County. If other jurisdictions decided not to opt in, it would continue to serve as a local, unincorporated area-only exchange program until such time that the Board elected to no longer participate. The Board could also choose to develop both a local VMT mitigation exchange program and also participate in the Regional VMT Mitigation Program, which would provide the most options for developers.
Decisions about who would implement and administer the Regional VMT Mitigation Program are still being discussed. At this time, staff would recommend continuing to work with SANDAG to pursue additional grant funding to implement a three-year pilot program. A pilot program would help both agencies understand the real-time benefits, costs, and responsibilities of a Regional VMT Mitigation Program and ultimately would support long-term solutions for VMT in the unincorporated area.
State VMT Mitigation Program
Under State legislation (Assembly Bill (AB) 130) adopted in 2025, the State is introducing a voluntary, State VMT Mitigation Program, administered through a Transit-Oriented Development Implementation Fund (TDIF). The purpose of this program is to mitigate transportation impacts by funding location-efficient, affordable housing and related infrastructure on the understanding that affordable housing generates less VMT than market-rate housing projects. On April 8, 2026, LCI released draft program guidance that outlines how the program will operate, including how mitigation contributions will be calculated, how location-efficient areas will be defined, and how VMT reduction benefits will be verified. The California Department of Housing and Community Development (HCD) will issue technical guidance on pricing, accounting, and program administration with the final materials, which are expected to be released alongside the full plan by July 1, 2026. County staff are participating in the State’s technical advisory group for program development.
Participation in the State program would be an option for mitigating VMT impacts for projects where the lead agency identifies a VMT impact requiring mitigation. Where a project applicant elects to use the State program as a mitigation strategy, the lead agency would contact HCD, provide relevant information about the location of the project and amount of VMT mitigation needed. HCD would calculate the monetary contribution needed to mitigate the project’s transportation impact and the project applicant would deposit the contribution amount into the TDIF. Initial fee estimates from the State indicate that the cost to mitigate VMT will be high, particularly for unincorporated areas. Applying the draft State fee to example unincorporated area projects, the mitigation fee per unit ranges from a low of approximately $6,800 per unit (North County Metro area) up to $231,000 per unit (Bonsall area), depending on project location. Local VMT mitigation contributions into the State program would be invested back into the SANDAG region; however, it is expected that most improvements would be located within cities and may not directly benefit unincorporated communities because allocations will follow regional (SANDAG) priorities rather than local jurisdiction boundaries.
The State has confirmed that participation in the State program is optional, and local agencies will continue to determine whether a project has a significant VMT impact and how much mitigation is required. State law also clarifies that agencies may continue to use local or regional mitigation programs, transportation demand management, transit improvements, or active transportation projects instead of the State program. The State intends to phase in program implementation by first allowing public projects to participate in the program to support effective implementation.
As longer-term, local solutions for VMT are considered as part of the Framework, a local VMT mitigation program could be designed to work with the State program. For example, the County could require VMT mitigation to prioritize mitigation using a local program to maintain local control of the mitigation fees and decision-making on how to invest those funds. If additional mitigation is needed beyond what a local program can offer, the State program could offer another way to mitigate. Further, a unique feature of the State program is that VMT mitigation funds will be used to supply the gap funding needed to support affordable housing production. As local VMT mitigation options are considered, the Board can consider how a local VMT mitigation program could similarly support affordable housing development in partnership with the County’s HCDS to help meet both VMT mitigation requirements and advance housing goals.
Focused TOA Mitigation Program
At the direction of the Board, staff conducted a TOA assessment to study how market conditions, financial feasibility of housing, existing land use types, and potential land use changes could support VMT reductions. The purpose of the TOA assessment was to understand where increased densities could reduce VMT and whether a focused mitigation program could help support housing and remove VMT barriers. Since that Board direction was given, case law has allowed the County to reconfirm the use of 15183 streamlining. As a result, most General Plan-consistent projects are able to use this streamlining pathway which allows transportation analysis to be based on LOS instead of VMT. This has removed VMT as a major barrier to development within unincorporated areas at this time.
The Board originally asked for options to create a focused TOA VMT Mitigation Program that considered no changes in land use and another option that would consider changing land use. Based on current conditions and the use of 15183 streamlining, a TOA-specific VMT mitigation program would not offer substantial benefits. While the circumstances have changed since Board direction to complete a TOA assessment, the results still provide important information that can help guide future planning efforts. The assessment shows that increasing density in certain areas could expand where development may be considered VMT-efficient. It also shows that land use changes can reduce VMT in certain areas, which could reduce potential VMT mitigation costs. These findings offer a clearer understanding of where targeted land use updates could support VMT reductions and improve overall feasibility of VMT mitigation.
The TOA assessment examined how land use changes could affect VMT efficiency. This work identified 297 parcels near transit, infill areas, and certain Villages where increased densities could be feasible. An analysis of current market conditions as well as the financial feasibility of attracting higher density of development was completed. A VMT analysis was then conducted to determine how these potential density increases would affect VMT performance in the studied areas. The results showed that targeted land use changes could create new VMT-efficient areas around Valle de Oro and lower VMT in several other TOAs, including Spring Valley and Sweetwater (page 11 of Attachment B, Exhibit A).
As part of the TOA assessment, staff performed a high-level evaluation of potential VMT mitigation cost for the various TOAs. The per unit costs vary greatly depending on the Community Plan Area (CPA) and the location within the village cores of the CPAs. For example, a project in the Lakeside Town Center/Village Core may have a per unit cost of $2,900 to $7,400 while a unit in the Ramona Town Center/Village Core may have a per unit cost of $20,100 to $50,200. If the program were to include density changes, the analysis demonstrated that the average VMT in certain areas could be reduced, reducing the mitigation cost by 20-30%. The VMT reductions would occur with the change to the General Plan. With an EIR, the mitigation cost could be reduced further by taking into account project feasibility when considering mitigation fees.
PUBLIC INPUT
Staff have heard a wide range of perspectives regarding VMT implementation and potential mitigation programs. Some community members have expressed concern that any County VMT mitigation program would not adequately reduce VMT impacts. Other groups have raised concerns that VMT mitigation requirements have created uncertainty, and new fees will create new barriers for development. Some community members have stated a preference for the continuing use of 15183 and mitigating based on LOS, noting that it provides predictability and avoids new VMT mitigation requirements.
As part of recent outreach, staff met with interest groups to discuss the potential role of VMT in future planning efforts. These groups emphasized the importance of predictability, consistency, and clarity in the development process. They noted that frequent changes to VMT rules have made long-term planning and investment decisions more challenging. Concerns were also raised about the cumulative cost of development, including the possibility that VMT mitigation fees could be added to existing requirements, which may affect project feasibility in the unincorporated area.
Sustainable Land Use Framework
Beyond the action today, staff will return with options for Board consideration on the Framework within the next year. Broader decisions about how to integrate VMT, housing, sustainability, and other land use considerations will be included in that hearing. The Framework is intended to aid the County in navigating and balancing actions such as evolving legislative mandates, community priorities, and development activity by serving as both a responsive and proactive tool for future land use planning and decision-making for the unincorporated area. Potential implementation paths for the Framework can establish a clear foundation for policy development, such as potential land use changes to align with findings from technical analyses such as the recently completed Development Feasibility Analysis and the TOA assessment. Framework efforts would incorporate meaningful engagement with community and industry members.
As discussed above with the State program, costs to mitigate for VMT will be high and will likely be considered another barrier to housing. One way to address this barrier locally is to consider a local VMT Mitigation Program within the context of an EIR. Within an EIR, there is opportunity to require partial VMT mitigation provided the fee is supported by substantial evidence and reduces impacts to the maximum extent feasible. This approach would provide the flexibility to create a tiered fee structure where lower fees (supported by market studies) can be applied to areas such as certain Villages and areas near transit and services. By considering a VMT Mitigation Program together with focused consideration of land use changes within the context of the Framework and supported by an EIR analysis, there is opportunity to advance longer-term VMT mitigation solutions.
Looking ahead, in order to advance key planning efforts, a transition from LOS to VMT will be required as the appropriate metric for transportation analysis in the General Plan. There is a need to consider future land use changes as part of Community Planning efforts, density changes to accommodate new RHNA sites as part of the next Housing Element cycle, and to incorporate land use changes based on the results of the TOA assessment (if directed). Land use changes associated with these planning efforts will require an update to the General Plan and an evaluation of transportation impacts based on VMT. Staff will present options for the Framework in the coming year that advance opportunities for future planning efforts and will incorporate longer-term solutions for VMT. A transition to VMT as the transportation metric in the General Plan for the unincorporated area would maintain 15183 streamlining, while further aligning with sustainability goals.
ENVIRONMENTAL STATEMENT
Receiving this report on the options for Vehicle Miles Traveled mitigation and directing further investigation are exempt from the California Environmental Quality Act (CEQA) because it is not a project as defined in section 15378 (b)(5) of the CEQA. The County of San Diego Board of Supervisor’s direction to initiate work on any of the proposed options will not have a significant effect on the environment.
LINKAGE TO THE COUNTY OF SAN DIEGO STRATEGIC PLAN
Today’s proposed actions for this project support the County of San Diego’s 2026-2031 Strategic Initiatives of Sustainability, Equity, and Community by pursuing policy and program changes that enhance the community through increasing the well-being of residents and the environment.
Respectfully submitted,
DAHVIA LYNCH
Deputy Chief Administrative Officer
ATTACHMENT(S)
Note: Due to the size of the attachments, the documents are available online through the Clerk of the Board’s website at www.sandiegocounty.gov/content/sdc/cob/bosa.html. <http://www.sandiegocounty.gov/content/sdc/cob/bosa.html>
Attachment A - County of San Diego History of Vehicle Miles Traveled Integration
Attachment B - Transit Opportunity Area Assessment Report Cover Letter
Exhibit A - Transit Opportunity Area Assessment Report