Court of Appeal Affirms EIR Water Supply Analysis for Major Industrial Warehouse Project

A recent decision by the Third District Court of Appeal confirms that an EIR's water supply assessment need only provide decisionmakers with sufficient information to evaluate the pros and cons of supplying a project's water needs. City of Vallejo v. City of American Canyon, __ Cal. Rptr. 3d __, 2026 WL 100754 (Jan. 14, 2026).

The Giovannoni Logistics Center Project is a 2.4 million-square-foot industrial warehouse complex proposed on industrially zoned land in American Canyon. The Project would require 23.9 acre-feet of potable water per year—an amount the court characterized as "modest compared to other uses"—but would not generate any new water supply. American Canyon lacks groundwater access and depends in part on the City of Vallejo, which supplies roughly 23 percent of its water under a 1996 interagency agreement. A portion of that water is diverted from the Sacramento-San Joaquin Bay Delta pursuant to Vallejo's appropriative water right, which restricts where the water can be delivered.

Vallejo challenged the EIR's water supply assessment.

Analytical Framework

The court's analysis was guided by four principles from Vineyard Area Citizens for Responsible Growth, Inc. v. City of Rancho Cordova, 40 Cal.4th 412 (2007), concerning the sufficiency of an EIR’s water supply analyses. Under Vineyard, an EIR must present sufficient facts for decisionmakers to evaluate water supply, must not defer analysis of future sources, must identify supplies bearing a reasonable likelihood of availability rather than relying on "paper water," and must discuss alternative sources where future supplies remain uncertain. At the same time, the court emphasized, a project need not have "definitely assured water through signed, enforceable agreements."

Water Supply Claims

On Vallejo's first claim—that the contracted amounts represented “paper water” rather than a reliable source of supply—the court found no support for this characterization. American Canyon had received 100 percent of its contracted water for all but one year since 1999 and purchased less than its entitlement due to cost, not supply constraints. Because these water supplies were neither uncertain nor unlikely to be available, the court found no basis to treat the contracted entitlements as "paper water."

The court also rejected Vallejo's argument that the EIR’s failure to disclose place-of-use restrictions in the water supply contract was prejudicial error. While those restrictions prevented delivery of the contracted supply directly to the project site, they affected only where water could be used, not the overall volume available. The EIR concluded that total projected water supplies in American Canyon would be sufficient to meet total projected demand in all years and all scenarios. Thus, the omission of the place-of-use limitations was "insubstantial or technical" and harmless.

The court likewise found no merit in Vallejo’s claim that the EIR’s discussion of the possibility of emergency water curtailments was inadequate. The EIR disclosed that both cities received water through the North Bay Aqueduct, and adequately alerted decisionmakers to the risks of simultaneous water curtailment. The court rejected Vallejo’s contention that the EIR should have discussed alternative water supply sources, noting that this requirement applied only if the agency was unable to determine whether a particular water supply would be available, which was not the case here. 

Practical Implications

This decision reinforces that CEQA demands adequacy, not perfection, in water supply analyses. Agencies may rely on contracted water entitlements and existing urban water management plans rather than disclosing every detail of historical purchases, and courts will resist imposing analytical requirements not explicitly required under CEQA or the Guidelines.