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DOWDALL LAW OFFICES A PROFESSIONAL CORPORATION ATTO R N EYS AT LAW City Council of the City of Santa Ana City of Santa Ana September 16, 2021 Page 18 "Project," in turn, is defined by the Guidelines as "the whole of an action, which has a potential for resulting in a physical change in the environment, directly or ultimately, and that is ... (1) an activity directly undertaken by any public agency...." (14 Cal.Admin.Code Section 15378). It is apparent solely from the terms of CEQA and the Guidelines that the proposed rent control law in Los Angeles is a "discretionary project" subject to the requirements of CEQA. Passage of the rent control law would clearly be an activity directly undertaken by a public agency and would, equally clearly, involve the exercise of judgment or deliberation (See, 60 Ops. Ally. Gen. 335, 336 (1977) "Ordinances and resolutions adopted by a local agency are 'projects' within the meaning of CEQA"). It is also apparent that the proposed modification of the RSO, if enacted, would have "a potential for resulting in a physical change in the environment, directly or ultimately," in the form of deterioration of the physical condition of a mobilehome park, abandonment, or termination of the business of operating a mobilehome park. If a landlord cannot pass through all increased costs (and not some fractional portion), including increased debt service costs involving refinancing of previously incurred costs of capital improvements and additional capital improvements and necessary capital for maintenance and repair, the physical environment will de -stabilize and change. This is a situation, in other words, in which the direct economic impact of the ordinance translates to an ultimate physical impact. An analogy may be drawn between the ultimate physical impact that may result from the proposed amendment and the ultimate physical impact which might result from a public transportation fare increase. In Opinion No. SO74-42, 60 Ops. Atty. Gen. 708 (1975), the former Attorney General, Evelle Younger, wrote: "It is clear that the proposed... fare increase, in all likelihood, would cause some of the current passenger trips to be diverted either to the automobile or to the Greyhound Bus service, thereby adversely impacting the San Francisco Bay area's ambient air quality and the overall traffic flow in the Westbay-Peninsula Corridor." Id., at 720. See also, Shawn v. Golden Gate Bridge (1976) 60 Cal.App.3d 699 (Transportation District's fare increase for travel upon bus line was a "project" under CEQA). The potential for adverse environmental consequences is sufficient, per se, to trigger a decision requiring preparation of an Environmental Impact Report. The possibility for future environmental impact from a rent control ordinance necessitates a study to determine whether the impacts of the ordinance can be alleviated by less restrictive terms, provisions, and conditions. Indeed, it is the purpose of CEQA to allow the public to comment on mitigation measures which would reduce the environmental impact. Such mitigation measures should also be addressed by the Environmental hnpact Report, to insure that the impact upon the environment caused by restriction in rental income is eliminated. Indeed, in the City of Los Angeles which adopted rent controls, an FIR was prepared, in the face of a rent law allowing an