Mixed-use development pulled following legal challenge over environmental review
A long-planned mixed-use development proposed for 603 Sutter Street in Folsom’s Historic District has officially been abandoned following a Sacramento County Superior Court ruling that found the City’s approval process violated state environmental law.
On Tuesday, Jan. 13, 2026, the City Council formally rescinded its prior approval and environmental determination for the project, complying with a court order that required the City to set aside all entitlements associated with the proposal. The action brings an end to a multi-year process that included commission approval, a City Council appeal, and subsequent litigation involving the City of Folsom and the project applicant.
The project was originally approved by the Historic District Commission on Sept. 6, 2023. Plans called for a three-story, 12,177-square-foot mixed-use building designed to reflect a pre-1900 architectural style intended to complement the character of Folsom’s historic Sutter Street corridor.
According to earlier city staff reports, the development would have included approximately 2,700 square feet of ground-floor retail or restaurant space, more than 5,200 square feet of office use on the second floor, and two two-bedroom residential units occupying the third floor. Outdoor features such as patios and balconies were also part of the proposal.
At the time of approval, City staff determined the project qualified for a Class 32 infill exemption under the California Environmental Quality Act, concluding that no additional environmental review was required. That determination quickly became a central point of contention.
Folsom resident Robert Delp filed a formal appeal of the design review approval, raising more than a dozen objections related to the project’s massing, scale, parking impacts, removal of oak trees, proximity to historic structures, and concerns over the accuracy of project renderings. City staff responded to each issue in a detailed report, and on Oct. 10, 2023, the City Council denied the appeal, allowing the project to move forward.
The dispute did not end there.
In December 2023, Delp filed suit in Sacramento County Superior Court against the City and the project applicant, Cedrus Holdings Limited Partnership, arguing that the City improperly relied on a categorical CEQA exemption and failed to adequately analyze potential environmental and historic impacts.
In a ruling issued Nov. 21, 2025, the Sacramento County Superior Court granted a peremptory writ of mandate, ordering the City to vacate its approval of the project and its environmental determination. The court further directed the City to revoke any permits or approvals that had been issued based on those decisions.
According to the staff report presented to council, state law requires local agencies to comply with such writs and outlines penalties for failure to do so. City staff advised that the only legally permissible action was to formally set aside the approvals in their entirety.
The City Council unanimously adopted the recommended action without discussion, bringing the City into compliance with the court’s judgment and officially closing the entitlement process for the proposed development.
With the approval now rescinded, the 603 Sutter Street project cannot move forward as previously designed. Any future development at the site would be required to restart the process from the beginning, including new design review applications, fresh environmental analysis, and public hearings before both the Historic District Commission and City Council.
For now, the site remains undeveloped, and City staff reported that no new applications have been submitted to replace the withdrawn proposal.
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