California Enacts Major Housing Reform Exempting Urban Projects From CEQA

California is enacting significant reforms to the California Environmental Quality Act (CEQA) to address the state's severe housing crisis by removing a major legal barrier to construction in urban areas. Governor Gavin Newsom has signed legislation that exempts most low- and mid-rise developments in multifamily zones from extensive environmental reviews and litigation risks, aiming to streamline housing development and encourage infill projects. While CEQA has historically served as an important environmental safeguard, critics argue it has also been used to delay or block needed housing, contributing to affordability and homelessness challenges. Despite these reforms, other factors such as labor shortages and high costs will continue to influence housing production, but the removal of CEQA hurdles is seen as a crucial step toward increasing supply. Public opinion polls indicate that California voters remain deeply concerned about housing affordability, with many feeling the state has not done enough despite recent legislative efforts. Local voices, including Fresno business leaders, emphasize the necessity of reducing bureaucratic delays to unlock housing potential and comply with state mandates, further highlighting the urgency for streamlined development processes.