Newsom puts CEQA on blast. What is it and why does it matter?

As far as obscure-sounding government acronyms go, perhaps none carry more weight in California than CEQA.

Short for the California Environmental Quality Act, the state’s landmark environmental protection law affects a wide range of land-use decisions, from which low-income apartments win approval to where oil well permits are issued.

Environmentalists and neighborhood groups champion the law as fundamental to preserving natural habitats and protecting public health. But developers and housing advocates have long maintained it is weaponized to kill or delay new home construction — exacerbating the state’s chronic housing shortage.

After a state court last month ruled UC Berkeley violated the five-decade-old statute in its plans to build student and homeless housing at People’s Park, familiar calls for CEQA reform made headlines and sparked renewed discussion in Sacramento.

Gov. Gavin Newsom blasted CEQA for allowing the state to be “held hostage by NIMBYs” and vowed to help change the law. Scott Wiener, a Democratic state senator from San Francisco, told the Bay Area News Group he plans to introduce a bill “to deal with the specific problems this court case has created.”

Major CEQA reform efforts haven’t gone far in the past, but the political landscape could be shifting. Wiener cited recent state laws exempting certain types of housing. He said court decisions like People’s Park are increasingly convincing lawmakers and the public that “maybe this is a deeper problem that needs a more structural fix.”

Here’s the history behind CEQA (pronounced “see-kwuh”) and what’s behind the latest fight over the state’s signature environmental law.

Q: What is CEQA, and why are people so mad about it?

A: Signed into law in 1970 by then-Gov. Ronald Reagan, CEQA requires public agencies to follow a complicated process for studying and disclosing how proposed projects could affect the environment and surrounding communities. In many cases, an agency must ensure plans address any “significant impacts” — from air quality and water supply to traffic.

Importantly — and controversially — the law also allows private residents and organizations to sue to force additional project analysis. Over the decades, state courts have issued rulings broadening the scope of the reviews. Sometimes, addressing the issues raised makes projects too expensive to continue.

Studies have found CEQA lawsuits are often filed by those seizing on precedent to stall multifamily housing projects. That can include environmental advocacy groups, competing developers, labor unions and residents concerned about new homes in their neighborhood.

Developers and housing advocates say the lengthy reviews and lawsuits often add crushing costs and delays. They contend CEQA, while well-intentioned, has become one of the main hurdles to building desperately needed homes for people of all incomes.

“It’s a lead weight around the ankle of an otherwise important endeavor,” said Louis Mirante, vice president of public policy with the pro-housing Bay Area Council.

Since its passage, CEQA lawsuits have popped up in nearly every corner of the Bay Area. Recently in Livermore, a lawsuit to stall a 130-unit affordable housing complex lost on appeal, but delayed the project.

Some environmentalists and neighborhood groups, citing their own studies, say those complaints are overblown. They argue the full scope of the law is necessary to ensure homes aren’t built in areas at high risk of wildfires and to limit gentrification, among other concerns.

“It’s an incredibly important moment and opportunity and place for informed decision-making and democratic engagement for how California is going to grow,” said Aruna Prabhala, an attorney with the Center for Biological Diversity.

Q: What happened with People’s Park?

A: The state appeals court sided with two nonprofit groups that argued UC officials didn’t adequately analyze how much noise could be caused by the roughly 1,100 students who would move into the project planned for the school’s historic public park.

While maintaining CEQA should not be used as a “redlining weapon by neighbors who oppose projects based on prejudice,” the judges decided the school ignored the impacts of “loud student parties in residential neighborhoods near the campus.”

The school plans to appeal the ruling to the California Supreme Court.

Housing advocates argue the decision could become exactly the “redlining weapon” the court warned against. To avoid similar lawsuits, advocates worry planning officials may start considering how specific groups of people — low-income residents, for example — could impact a local community.

Some CEQA backers are skeptical of such arguments by housing groups and politicians, accusing them of being beholden to powerful development interests with little concern for low-income people and communities of color.

“Those who defend CEQA, who do they represent? And those who attack CEQA, who do they represent?” Prabhala asked.

A makeshift structure and treehouse on one of the last remaining trees at People’s Park in Berkeley, Calif., on Monday, Feb. 27, 2023. A California appeals court has blocked a proposed housing project at the park that has drawn protest and controversy, ruling that the project’s Environmental Impact Report was inadequate. (Jane Tyska/Bay Area News Group)

Q: What reforms have occurred in the past? 

A: In recent years, state lawmakers have passed legislation that exempts some housing projects from CEQA, including certain types of affordable housing, student housing and homeless shelters.

But opponents can file lawsuits challenging whether those projects meet the often-strict standards for exemption. That’s a big part of why housing advocates argue CEQA needs to be fundamentally reformed.

“What is needed is a wholesale look at whether having it this easy to kill a project and set it back three years can be maintained as a general rule,” said Daniel Golub, a real estate attorney with San Francisco-based Holland and Knight.

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Q: What could happen next?

A: This isn’t the first time Wiener has introduced a CEQA bill. Last year, he pushed for successful legislation exempting student housing at public universities from CEQA, partly in response to a separate lawsuit filed against UC Berkeley.

That lawsuit attempted to limit how many students the university could enroll each year, putting the People’s Park project in jeopardy. The project isn’t exempt from CEQA because it started before the student housing bill took effect, and is also a historic site.

Wiener declined to go into specifics on his upcoming legislation. But he said it could afford new protections for many types of housing development.

“It’s not a narrow bill,” he said. “Let’s put it that way.”