San Jose officials are celebrating the rollback of a long-standing environmental law, which has been a hurdle for housing production.
Gov. Gavin Newsom on June 30 signed two bills, Senate Bill 131 and Assembly Bill 130, which bring significant reforms to the California Environmental Quality Act (CEQA) — allowing many developments to circumvent an environmental review process. New housing projects built on vacant land around existing development, known as infill housing, will no longer be constrained by environmental reviews if they are under 20 acres, less than 85 feet tall and meet local zoning standards.
Other projects exempted from CEQA regulations include health clinics, child care centers, broadband, water infrastructure, food banks, farmworker housing and advanced manufacturing facilities.
CEQA, signed into law in 1970 by then-Gov. Ronald Reagan, required governments to evaluate and publicize the environmental impacts of a project — from pollution, noise, groundwater quality and more — giving the public a chance to weigh in before it gets approved. It also required cities and developers to do what they could to mitigate these impacts.
With new CEQA reforms, cities and developers will be less concerned about a citizen or neighborhood association coming after them for not having a detailed environmental impact report.
“For too long, CEQA has been weaponized to delay and derail housing, infrastructure and other investments we desperately need. In fact, a majority of the lawsuits brought under CEQA are not even about the environment,” San Jose Mayor Matt Mahan told San José Spotlight. “With these long-overdue reforms, California is finally restoring balance to a process that has stood in the way of progress. In San Jose, we’re pairing these state-level changes with local incentives so we can say ‘yes’ to more housing and other things we need — and actually get shovels in the ground.”
A spokesperson in San Jose’s Planning, Building and Code Enforcement department said while CEQA has been useful in understanding environmental impacts, in some instances projects have been delayed for up to two years in the planning process due to environmental reviews.
“While it has helped ensure responsible growth, it has become a significant barrier to the delivery of new housing throughout the city over time,” the spokesperson told San José Spotlight. “Projects can get caught up in litigation. Technical analysis for CEQA reports are also costly, which poses a barrier for applicants with smaller projects.”
The city will likely start to feel a direct impact in its ability to quickly approve housing developments, the spokesperson said. The department estimates some projects can be approved in half the time.
However, environmentalists question how big of a role CEQA has played in holding up housing development, and say it protects vulnerable communities from incurring more negative environmental effects.
“Very few projects get contested through CEQA,” Raquel Mason, senior legislative manager with California Environmental Justice Alliance, told San José Spotlight. “CEQA has been in place for decades, and we’ve had good housing markets and really tough housing markets, at the same time. CEQA is not the reason why our housing prices are so unaffordable right now.”
Affordable housing won’t be affected much by these reforms, given the exemptions that already exist through legislation like SB 35, passed in 2017 to allow cities to streamline and bypass certain review processes. It’s largely market-rate housing developers that will be able to take advantage of these reforms, Rob Wilkins, Northern California vice president of affordable housing developer Affirmed Housing, said.
“The affordable housing community has been able to get around CEQA for several years now,” Wilkins told San José Spotlight. “But now (the changes) have finally blown them out of the water, and you don’t even have to really worry (about CEQA). Which is the biggest obstacle, people say, to get to reaching the (state-mandated housing) numbers that we’re supposed to be hitting. So whether that’s true or not, you know, time will tell.”
San Jose is required to build 62,200 homes by 2031, according to its state-mandated housing plan. So far, San Jose has completed 3,586 homes in the current cycle, which runs from 2023 to 2031. It has another 5,890 houses and apartments that are permitted, and 14,280 that have received land use approvals.
The high costs of construction have been a barrier to meeting housing goals, the planning department spokesperson said, and construction costs also increase when CEQA delays a project from moving forward.
“We hope that these changes will help us fulfill that goal,” the spokesperson said.
Ilya Gurin, a member of South Bay YIMBY, said it’s too early to be sure how much impact these reforms will have — and is largely dependent on how San Jose will implement them.
“It’s possible that this will have a small impact. It’s possible that it will have a huge impact,” Gurin told San José Spotlight. “Housing advocates are quite optimistic.”
Contact Joyce Chu at [email protected] or @joyce_speaks on X.
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