El Cajon wins appeal to annex Home Depot property

An appellate court has cleared the way for Home Depot to build a store on unincorporated land bordering El Cajon in a case that has drawn the interest of local residents.

The 4th District Court of Appeal, Division Three last week overturned a lower court decision, ruling the San Diego Local Agency Formation Commission (LAFCO) erred in its claim that the property was not "substantially surrounded" by El Cajon, and the agency should have accepted the city's application for annexation.

"The statutory language reflects geographic and physical factors are the primary determinants of whether a parcel is substantially surrounded by an agency seeking an annexation or reorganization of it," Associate Justice William Rylaarsdam wrote in the opinion.

El Cajon tried to annex the 14.3-acre property, which is bordered on three sides -- or 68 percent -- by the East County municipality. Interstate 8 runs along the remaining 32 percent of the property.

El Cajon's fire department has the closest station and is designated as the first responder for emergency services. The city's police station is also closer to the property than the county sheriff's department. In addition, El Cajon has a sewer main adjacent to the property, and the proposed annexation would not result in any change for the provision of water to the parcel, according to court papers.

LAFCO, however, denied the city's annexation application, citing vocal opposition from residents and local agencies, including more than 150 letters and a petition "signed by over 1,000 people."

It also said Lakeside, which currently provides fire protection services for the land, would lose property tax revenue, and the agency disagreed with the environmental impact review (EIR) commissioned by Home Depot (NYSE: HD), which purchased the property in 2004, and certified by El Cajon.

City officials answered by filing a lawsuit, pointing to legislation that prohibits LAFCOs from denying annexation requests when the property in question is significantly surrounded by another jurisdiction.

"It's the classic case of the so-called 'island' that the state legislature has, for decades, urged LAFCOs to eliminate because of service inefficacies and poor land-use development," said Evelyn Heidelberg, a partner with Procopio, Cory, Hargreaves & Savitch, who helped represent El Cajon.

According to the appellate opinion, "not only is delivery of services and access to the property available solely through (El Cajon), absent the freeway, the statutory definition for a parcel that is completely surrounded would be satisfied."

The court also found LAFCO had violated the California Environmental Quality Act (CEQA) because it ignored the EIR that had been certified by the city of El Cajon, according to Heidelberg.

LAFCO and the county of San Diego, which is an interested party in the suit, will have 40 days to decide whether to appeal the case to the state Supreme Court.

Deputy County Counsel Ellen Pilsecker said attorneys will discuss the case with the County Board of Supervisors at its Sept. 14 meeting.

"I thought the trial court was correct," Pilsecker said. "(LAFCO) had exercised their discretion. There's nothing in the law says 68 percent is enough (to be substantially surrounded). Here, the court of appeal is saying it wasn't just 68 percent, but other geographical factors."

El Cajon Mayor Mark Lewis was pleased with the decision.

"If we do build a Home Depot there then that'd mean a great deal of tax income for the jurisdiction, be it the county or the city of El Cajon," he said. "Home Depot would be a benefit to the whole community. They are a very good community partner and were very generous with equipment in helping the city out with regard to the (2007) fires."

Heidelberg said the city has lost significant sales tax revenue because of the decision by LAFCO to deny annexation.

"This property is, and has been since 1985, in the city of El Cajon's sphere of influence," she said.