SACRAMENTO — California is poised to implement one of the most significant environmental and housing reforms in decades with the expected signing of Assembly Bill 609 into law as part of the state’s budget trailer bill, AB 130. The legislation, championed by Assemblymember Buffy Wicks and housing advocates, would exempt certain infill housing projects from review under the California Environmental Quality Act, or CEQA — a move that supporters say could substantially accelerate the construction of new homes in already-developed areas without compromising environmental protections.
The bill’s core provision creates a broad and simplified CEQA exemption for code-compliant housing developments in environmentally friendly “infill” locations — meaning sites that are either already developed or surrounded almost entirely by existing urban uses. Under the law, qualifying projects must be consistent with local zoning and cannot be located in environmentally sensitive or hazardous areas. The goal is to streamline approvals for urban housing while preserving rigorous environmental standards for developments in rural, wildland, or ecologically vulnerable regions.
“For decades, CEQA has required environmental studies for nearly all types of construction projects, regardless of their environmental impact. This has allowed anyone — for a relatively nominal fee — to sue to challenge the validity of a project’s environmental review, often delaying or halting projects for years,” said Brian Hanlon, CEO of California YIMBY. “While the law was created with good intentions, it has increasingly become a tool to block precisely the types of housing projects we need most — especially infill and affordable developments in cities.”
Hanlon called AB 609 “one of the biggest wins for housing in a generation,” noting that the new exemption makes it “crystal clear: building infill housing is not a threat to the environment — it’s how we save it.” He credited Wicks and Gov. Gavin Newsom for aligning California’s environmental framework with its climate and housing priorities.
The issue of CEQA reform has long been a flashpoint in California politics. Originally passed in 1970 to safeguard the state’s natural environment, CEQA has also been criticized for enabling costly delays and litigation, even for projects that have already undergone environmental analysis at the local level. According to housing advocates, the law’s broad applicability and vulnerability to legal challenges have discouraged homebuilders from pursuing new housing in high-opportunity urban areas, where infrastructure already exists but approval processes are slow, uncertain and expensive.
In particular, CEQA lawsuits have been used to stop or delay projects like student housing for University of California campuses, homeless shelters, and multi-family developments in city centers. Because CEQA does not distinguish between environmentally damaging projects and those with net benefits, such as infill housing near transit, its application has often been indiscriminate.
CEQA review is often redundant, California YIMBY argued in a recent public statement. Cities conduct environmental analyses when they adopt new housing plans and zoning rules, but then must perform another review when projects that follow those rules are proposed. This repeated process creates bottlenecks and uncertainty, contributing to the state’s chronic housing shortage and worsening affordability crisis.
The state’s own oversight bodies have acknowledged the need for reform. In 2023, the Little Hoover Commission — an independent state watchdog — issued a report on CEQA calling for the creation of a broad, streamlined exemption for infill housing. AB 609 is a direct response to that recommendation.
Numerous studies have shown that infill housing has significantly lower environmental impacts than development in greenfield or undeveloped areas. Because urban areas already contain roads, sewer lines, transit access, and other infrastructure, building within them avoids the sprawl that contributes to air pollution, traffic congestion, energy overuse, and habitat destruction. New homes built in urban cores are also associated with lower per-capita carbon emissions due to reduced reliance on car travel and more efficient land use.
Advocates for the bill argue that by removing unnecessary CEQA barriers for this kind of housing, California can accelerate progress toward its climate goals, boost housing supply, and reduce displacement pressures.
The legislation is also notable for its labor provisions, which were included in negotiations over the trailer bill. Dave Rand, a land use attorney and partner at Armbruster Goldsmith & Delvac LLP, called the bill a long-awaited breakthrough. “Massive CEQA news. AB 609 language just released in the budget trailer bill,” Rand wrote on social media. “Labor provisions are in BUT are workable. In L.A. County, a $24 to $36 per hour wage floor — very different than prevailing wage in AB 2011/SB 35. This is it. Finally. CEQA reform for real.”
The new wage standards are expected to ensure that construction workers are paid fairly while avoiding the much higher prevailing wage requirements that some developers argue have made affordable housing prohibitively expensive to build.
AB 609, by being incorporated into AB 130, is expected to be signed into law by Gov. Newsom on Friday. It comes at a time when California is facing a severe housing crisis, with high rents, home prices, and homelessness rates threatening economic stability and social equity across the state. Experts and advocates have long called for the state to streamline approvals for infill housing, pointing to the mismatch between California’s ambitious climate and housing goals and its outdated permitting and environmental laws.
“Exempting infill housing from CEQA is one of the biggest single things we can do to address the housing crisis,” said Hanlon. “It has no fiscal cost to the state. And it will allow more homes to be built faster, where they’re needed most.”
If signed into law, AB 609 will take effect immediately as part of the state budget process, marking a rare and sweeping reform to CEQA — a law that has remained largely unchanged for more than half a century. Housing advocates see the bill’s passage as a landmark moment in the fight to increase housing supply, reduce climate emissions, and restore affordability to California’s cities.
This could be a game changer with the two important provisions. (The labor rate one may be just as important as the CEQA exemption.) I hope that developers can still be held liable for building on what later turns out to be a significantly hazardous location.
“I hope that developers can still be held liable for building on what later turns out to be a significantly hazardous location.”
That’s the same argument that’s being made regarding Village Farms, in regard to toxics and flooding (including redirecting water flow off-site, I understand).
Right now, that land is not a city liability at least.
I don’t know how it’s monitored in regard to farming the site, but the city has no responsibility for that.
For that matter, I understand that the current or future owners of the site could potentially go after the city for toxics leaking from the former adjacent landfill onto the site. (Seems like an increased risk of that potential liability if it’s subdivided with people living on it.)
“SITY” ?
From article: “Rand wrote on social media. “Labor provisions are in BUT are workable. In L.A. County, a $24 to $36 per hour wage floor — very different than prevailing wage in AB 2011/SB 35. This is it. Finally. CEQA reform for real.”
Those workers ALREADY can’t afford to live in the houses they’re building. This will ensure that situation continues.
Don’t fast food workers make almost that much, now ($20/hour minimum wage to start)?
I guess Trump better not send those construction workers back to their home countries, after all. (Not that they’d be able to afford that housing, but they might have trouble finding anyone else to take those jobs – especially for work that requires skill.)
It’s almost kind of amusing to watch the state squirming with unachievable goals that are based upon fake problems in the first place.
“Those workers ALREADY can’t afford to live in the houses they’re building.”
What is your proposal to address that problem
I’m glad you asked that. (You fell into my little “trap” – ha, ha, ha. I’m trying compose an “evil/maniacal laugh”, but I don’t know how that’s spelled.)
In any case, if those buildings aren’t constructed, those workers don’t need to be in that relatively expensive location at all. (Plus, their jobs are temporary in the first place.)
The actual problem consists of trying to house people who can’t afford a particular location IN that location.
There’s lots of places that are a better deal, at this point. (Housing prices are declining in most places by this point, but they’re still not a good-enough deal in expensive locations in particular. Unless you’re a tech worker, perhaps.)
It’s a different world than the one our parents experienced.