When the CEQA reforms passed last week, I was asked by multiple people whether I believe these changes will actually move the ball forward in terms of housing production.
The honest answer is: it depends.
From what I’ve seen, CEQA—the California Environmental Quality Act—tends more often to delay housing projects than block them outright. That’s still a serious problem. Delay adds uncertainty, drives up costs, and makes it harder for housing developers, especially affordable housing developers, to plan and execute projects.
It allows opponents of housing—often acting in bad faith—to weaponize the process against even modest developments.
That’s why it makes sense that the state has also worked to streamline project approvals through legislation like SB 35 and other pro-housing measures.
But let’s not kid ourselves: CEQA abuse is only one piece of a much larger puzzle. Even with reforms to reduce frivolous lawsuits and fast-track infill housing, we still face enormous structural barriers.
I think the point State Senator Scott Wiener recently made is important .
In an interview with The San Francisco Standard and later in a podcast conversation with Derek Thompson—who coauthored the book Abundance with Ezra Klein—Wiener was asked how success should be measured, given that the Legislature has passed a number of pro-housing bills over the last five years but new housing construction remains sluggish.
“We’re very aware that the last five years have been rough,” Wiener said, pointing to supply chain disruptions and high interest rates. “My view is that we need to get the rules right and in place so that when the economic stars align again, we can build a ton of housing.”
That’s exactly right. This moment may not deliver immediate results, but it is about laying the groundwork. When financing becomes easier and the construction environment improves, developers need to be able to build without navigating a minefield of outdated rules and politically motivated lawsuits.
Still, even with that long-term optimism, I see major barriers standing in the way—barriers that CEQA reform alone won’t solve.
Start with Davis, where I live.
Locally, Measure J/R/D has put the city in a difficult position. Intended to give residents a say in peripheral development, the law now effectively blocks all new growth outside the existing city footprint unless it’s approved by voters—something that has happened just three times in nearly a quarter-century.
In the meantime, state housing mandates have forced Davis to comply by rezoning for infill. But infill has limits.
The city has already used many of the most viable sites, and what’s left is harder, more expensive, and more politically fraught. That means the city will increasingly rely on peripheral housing to meet future obligations—but those projects are, for all practical purposes, dead on arrival unless voters change course.
This creates a legal and political contradiction: the state says we must build; the voters have erected a near-absolute barrier to building. At some point, that contradiction will become unsustainable.
Either Davis will be compelled to revise Measure J/R/D, or it will face increasing legal pressure from the state. We are already seeing HCD (California’s Department of Housing and Community Development) taking a more aggressive stance with cities that fail to comply with state law. Davis may not remain immune for long.
Second, there’s the escalating cost of construction—especially for affordable housing. Building housing in California is expensive under the best of circumstances. When land costs, labor, materials, and regulatory delays are factored in, projects become nearly impossible to finance without heavy subsidies. And the irony is that affordable housing, by definition, can’t raise rents to cover those costs. That means fewer units get built, and the ones that do require years of complex financing and public support.
The situation is only made worse by federal policy. The proposed tariffs under the Trump administration—especially those targeting construction materials like steel, aluminum, and lumber—are poised to raise costs even higher. As The New York Times and other outlets have reported, these tariffs are designed to appeal to a political base rather than solve real economic problems. But their consequences will be real: higher construction costs, fewer affordable housing starts, and longer delays. It’s the exact opposite of what we need.
Third, we lack a meaningful replacement for redevelopment funding. Before it was eliminated in 2011, redevelopment tax increment financing was the single most important tool cities had to finance affordable housing and community revitalization.
Since then, the state has offered one-off bond programs and limited tax credits, but there’s no consistent mechanism to support local governments that want to build. Some promising ideas have been floated—new tax increment tools, enhanced infrastructure financing districts, even a potential constitutional amendment—but none have scaled to meet the moment.
Without serious and sustained investment, California will not meet its affordable housing targets, no matter how many zoning laws it rewrites.
And this brings us to the broader point: the housing crisis is no longer just a California problem.
As The Atlantic recently reported, housing prices are rising fastest in red and purple states that were once thought of as havens for affordable living. In cities across the Sunbelt—from Phoenix to Austin to Nashville—demand has outpaced supply, and the same forces that plague California are beginning to show up elsewhere: exclusionary zoning, neighborhood opposition, infrastructure bottlenecks, and political paralysis.
The article put it bluntly: “Housing prices are rising fast in red and purple states known for being easy places to build.” That should be a wake-up call to anyone who thinks this crisis is about state mismanagement or liberal overreach. It’s not. It’s about the structural failure of our entire housing system—across the country.
So yes, CEQA reform was necessary. It won’t solve everything, and it won’t immediately produce a surge in housing starts. But it removes one of the tools that has been routinely misused to stop even the most sensible development. Combined with recent streamlining laws and accountability measures, it helps lay a foundation for a better, more responsive housing system.
But make no mistake: the real solutions require more than legal reform. We need political courage to revisit exclusionary local policies like Measure J. We need financial tools to support affordable housing at scale. And we need federal leadership that doesn’t kneecap the very projects it claims to support.
We’ve taken some good steps. But we still have a long way to go.
“CEQA Reform Is Only One Piece of t he Housing Puzzle”
Yes, the other piece is Communism. With Weiner as our authoritarian overlord.
“When financing becomes easier and the construction environment improves, developers need to be able to build without navigating a minefield of outdated rules and politically motivated lawsuits.”
Politically motivated – like motivated by those of us who believe in historical preservation and protecting the environment and not paving over farmland and not having the entire Sacramento – Bay Area corridor go the way of Orange County? That sort of ‘politics’. Lamest of the lame arguments – to cast yourself as morally superior, while casting your political opponents as being “political”. Lame.
DG say: “Start with Davis, where I live.”
I had no idea . . . Howdy Neighbor!
From article: “It allows opponents of housing—often acting in bad faith—to weaponize the process against even modest developments.”
It’s not “acting in bad faith”, when residents believe that developers and the state are the ones doing so in the first place. Some environmental groups also apparently have concerns regarding what the state has done. (Not sure of the reason, but perhaps it has to do with creeks or other sensitive habitat that exist within city limits.)
From article: “The city has already used many of the most viable sites, and what’s left is harder, more expensive, and more politically fraught. That means the city will increasingly rely on peripheral housing to meet future obligations—but those projects are, for all practical purposes, dead on arrival unless voters change course.”
Compared to some place like San Francisco (and much of the Bay Area), Davis is not a dense city (not even close). But the “problem” (for those pushing for more development) is that dense infill often doesn’t pencil out in a place like Davis, especially away from the core of the city. Housing prices (demand) are not HIGH enough to justify it, especially when all of the surrounding communities willingly pursue sprawl. The one exception is mega-dorms, for which the state apparently does not provide full RHNA credit.
It’s expensive to knock down existing buildings (in order to replace them). That type of thing works in places like San Francisco, Manhattan, Hong Kong, Tokyo, etc. (Might also increasingly pencil-out in Silicon Valley.) But it’s been going on for decades, without any “help” from the housing activists.
Ultimately, it seems likely that most “dense” rezoning in Davis will only be a paper exercise. In a sense, the state did a favor for the environment and farmland surrounding places like Davis, in that CEQA is still required for sprawl. As such, perhaps developers will increasingly seek infill (in places like the Bay Area), instead. The so-called “housing crisis” arose from places like the Bay Area in the first place.
With the housing market declining, I suspect that Davis will essentially continue as it is, including daily articles from the Vanguard, decrying the lack of sprawl (and lack of infill). And a school district that will be forced to close down a school or two, as many other districts are also facing.
The population itself is no longer growing. Young people aren’t having kids at replacement levels (nationwide), Trump is disincentivizing immigration, and there’s an exodus from the state itself. It’s a tough time to be a growth advocate, indeed.
Don’t be afraid of change.
“Don’t be afraid of change.”
That’s why they changed the law…
They did, but (as far as Davis and places like it are concerned), it’s yet another disincentive regarding sprawl.
And it also won’t result in more infill in places like Davis.
For the reasons I just pointed out.
You whiffed on this. Embracing change is not path dependent. You opened the door to change you don’t like when you exhort people to embrace change.
No – I’m pointing out that the state’s actions may result in a change that someone like me would “like”. Did you read my comment?
For that matter, I don’t think it will make much difference (regarding infill) statewide, since legal challenges of CEQA approvals were always costly for those challenging them, and such challenges usually don’t derail developments in the first place.
CEQA is only a “notification” tool, as Bill Marshall used to point out. Listing an impact as “unavoidable” doesn’t mean that the proposal itself isn’t approved.
What we have here is a governor who is preparing for a presidential campaign, and wants to “disassociate” himself from California, in a sense. (In other words, someone willing to slash “bureaucracy” – just like Trump.) I’m not the only one who noticed this.
That part I don’t disagree with – and have stated as much. In fact, that was the whole point of my piece.
Right – that’s why you continue to push for sprawl in your article (but your argument for it was just weakened by the state).
Like I said, the state might have gotten this one right (with the exception of wildlife areas that exist within cities, such as riparian corridors).
In any case, I don’t believe that CEQA was always limited to impacts on the natural environment. (We saw that in regard to the campaign to mislabel concerns regarding noise from student housing, as akin to calling students “pollution” – when that’s obviously not what that was about.)
Oddly enough, the growth activists focus on noise from mini-dorms, when it suits their purpose.
That’s a different issue.
If you’re referring to the “noise” issue, I’d suggest that state officials were the ones engaging in “bad faith” regarding how the labeled that.
Reminds me of how the “don’t say gay” legislation was labeled, in that I’m pretty sure you could still “say gay”. (Don’t recall the details, however.)
In any case, picking fights with the electorate (and purposefully mislabeling their concerns) sometimes ends up as something like Proposition 13. (Or, crackdowns on homeless encampments which are now fully allowed, etc.)
It takes a lot to awaken a sleeping tiger – but when that does occur – “bam”.
And when the electorate is lied to in the first place (e.g., “housing shortage” – put forth by those who benefit from claiming that it exists), it tends to piss them off even more when they ultimately figure it out.
I’m referring to the CEQA issue as to whether the reform will work – I think it is necessary but not sufficient to induce more housing. Therefore I laid out what more was needed locally and statewide. My support for peripheral development in Davis is both limited and specific to the fact that we have largely used up infill options.
You didn’t specify what you were referring to, but I already addressed that as well. Compared to some place like San Francisco (and much of the Bay Area), Davis is nowhere near as dense – not even close. As such, Davis absolutely has not “used up its infill options”.
But again, “your” problem is that it doesn’t pencil out to make it more dense (other than the core area).
So the likely outcome is a piece of paper showing more density, which will never occur. Especially when the population isn’t growing, and surrounding communities are nevertheless continuing to offer sprawl.
Face it – the state just handed someone like me a “gift”. But it’s more than that, because it actually provides legitimacy to what they claim was the problem (in places like the Bay Area).
Unfortunately, they continue to ignore the actual cause (pursuing the technology industry in an already-developed area, for example). That “oversight” is not an accident, since that industry (along with others) are the ones who fund the YIMBYs and their political allies.
That’s not exactly my view.
Again, not sure what you’re referring to, but I’m almost certain that housing won’t be knocked down in Mace Ranch, Wildhorse, or Lake Alhambra (three areas I’m familiar with) to accommodate the state’s “mandates”.
It’s apparently not even viable at Trackside – and it’s already been APPROVED.
But will some of this show rezoning “on paper”? Probably, and will never be built.
“LO ST REVERDRTEMENT FUNDING” ???
WT . . . ???