California YIMBYs just won a major battle, but the war over CEQA isn't close to finished

San Francisco Chronicle​

02-07-2025

When Gov. Gavin Newsom signed revisions to the California Environmental Quality Act into law on Monday to expedite new housing, he and the YIMBY movement reacted as if they had just won a major war.
'To the NIMBY movement that's now being replaced by the YIMBY movement: go YIMBYs,' the governor said at a press conference.
But the CEQA war isn't over yet — and major battles over law's purpose and role still lie ahead.
To be sure, for housing advocates, this week's reforms are extremely significant: It will be a lot easier for developers to get housing approved. Two budget trailer bills (AB130 and SB131) made significant changes to CEQA. One major reform was to exempt all 'infill' housing from environmental review — housing that is located in built-up areas. Another reform exempted certain types of projects, including childcare centers and some manufacturing facilities.
But in a way, these reforms are just more examples of what's come to be known as 'Swiss-cheese CEQA': The state punches a hole in the law to favor certain types of projects, but doesn't take a comprehensive look at what the law is for or how it should be reformed.
CEQA doesn't protect the environment directly. By requiring environmental analysis on projects that impact the built or natural environment, it identifies potential damage that new projects can create and forces changes to minimize that damage. But it can be a long, expensive and unpredictable process — and it often stimulates litigation from opponents who want to kill a development but don't really care about the environment. That's why an exemption for infill housing is such a big deal.
But Monday's legislation provided exemptions only for infill housing and a few other types of projects. CEQA still looms large in almost every other California construction project, whether it's a public infrastructure like a reservoir, a private development that doesn't fit the state's definition of infill or the BART extension to downtown San Jose. (CEQA review of the project, which also included federal environmental review, is so voluminous it needs to be broken up into dozens of documents online.)
Legal advocacy organizations like the Center for Biological Diversity are skilled at using CEQA to go after these large infrastructure and development projects. And they're not going away because of Monday's reforms.
Now that infill housing is exempt from CEQA, the biggest question is what role 'greenfield' development — new development on raw land that has never been touched before — will play in attacking the housing crisis and how CEQA should deal with such situations.
As Republicans pointed out during Monday's state Legislature debate, just last week, the Center for Biological Diversity won an appellate court case on a large greenfield project in Los Angeles County. The project called for 19,000 houses on 12,000 acres and setting aside 45% of the land for permanent open space. The court found that the environmental impact report prepared for the project under CEQA had not used the right greenhouse gas emissions reduction methodology. The revised report — written after a previous court ruling — is 2,300 pages. It has to be redone because the court in Los Angeles still found it lacking.
Nothing in the budget deal from Monday changes anything about the environmental review of this kind of project.
California state policy rightly favors infill development near transit. But privately, even most YIMBY leaders and other experts will say that you can't fix the state's housing problem with infill alone. You need at least some outward expansion into previously undeveloped areas as well.
But environmental review can take years, cost millions of dollars and easily be dragged out by litigation. Ultimately, the question the Legislature has to ask is not, 'What projects should be exempt from CEQA,' but 'What purpose is CEQA supposed to serve?'
In the Bay Area, the existential battle over CEQA is likely to manifest in the form of California Forever, the huge greenfield project proposed for Solano County. Whatever you think about more suburban expansion, the backers of California Forever are at least attempting to promise a more compact and walkable community than other large greenfield projects in the state — many of which are more prototypically suburban.
Yet it's still going to have to go through round after round of CEQA review — and most likely expensive litigation as well.
There's also likely to be a major battle over the new exemption for advanced manufacturing, which was included in Monday's reforms. Advanced manufacturing, including using precision tools and other modern processes to manufacture high-tech products, is a major state economic development goal because many of these products are designed in California but manufactured elsewhere. But the definition of advanced manufacturing in state law is pretty squishy, meaning advocates are almost certain to litigate these projects depending on where such companies wind up locating.
So, while Monday's action is a big deal, it's not comprehensive CEQA reform. Comprehensive reform would not just punch more holes in a flawed law; it would revisit and clarify the whole purpose of CEQA.
That existential battle still lies ahead.