Compliance with California Environmental Quality Act (CEQA)

The joint application contends that the indirect change of control of NextG contemplated by the proposed merger is not a "project" within the meaning of CEQA, and thus this application is exempt from CEQA review. Citing CEQA Guidelines 15060(c)(2) and 15061(b)(3), the application asserts:

CEQA does not apply where the proposed "activity will not result in any direct or reasonably foreseeable indirect physical change in the environment" or where "it can be seen with certainty that there is no possibility that the proposed activity in question may have a significant effect on the environment."

The Transaction involves only an indirect change in control of NextG. It will not result in any change in the management or operation of NextG's facilities or in any additional construction in California. (Id. at 8-9; footnotes omitted.)

The joint application also points out that in a number of recent decisions involving changes of control under Pub. Util. Code § 854, the Commission has agreed that the transaction is exempt from CEQA review. See D.06-02-033 at 44, 52 (transfer of control of Pacificorp from Scottish Power to MidAmerican Energy Holdings Company held exempt from review pursuant to CEQA Guideline § 15061(b)(3)); D.05-12-007 at 15 (transfer of 50% interest in gas storage company held exempt from CEQA review under CEQA Guideline § 15061(b)(3)); D.03-02-071 at 20, 27 (same).