On April 1 (local time), California made significant revisions to environmental-related legislation that had long obstructed the supply of dwellings. Despite being a region with a strong Democratic presence, the severe housing shortage and the resulting social issues led to a reversal of the previous policy direction prioritizing environmental concerns.
According to major foreign media outlets, Governor Gavin Newsom of California approved two amendments to the California Environmental Quality Act (CEQA) that exempt environmental assessments during dwelling construction. These bills received unusual bipartisan support in the state legislature.
With this revision, unless it is a site that is environmentally sensitive or hazardous, there is no longer a need to consider noise, air pollution, traffic, and other environmental issues when constructing dwellings in California. The New York Times (NYT) reported, "This revision lowers regulatory barriers, making it easier to convert vacant shopping centers into residential spaces."
The California Environmental Quality Act was enacted in 1970 by then-Governor Ronald Reagan (Republican) and requires state and local agencies to review the environmental impacts of development projects and create countermeasures. Private development projects, including dwelling construction, have also been subject to this law.
The Washington Post (WP) reported, "Housing developers have claimed that the Environmental Quality Act has been a major obstacle for decades, sometimes halting projects entirely, and that environmental activists have used the law to delay projects they oppose."
Due to these issues, the California legislature has been pushing for revisions to the Environmental Quality Act over the last decade, but efforts have repeatedly failed due to opposition from environmental activists and local governments. Governor Newsom has linked the revision of the Environmental Quality Act to the approval of the 2025-2026 state budget and has finally achieved legislative amendments for the first time in 50 years.
At a press conference following the approval of the legislative amendment, Governor Newsom said, "We have continually witnessed the abuse of the Environmental Quality Act, and we have become victims of delay tactics, resulting in a situation where the demand for dwellings is excessive while supply is drastically insufficient."
The reason Governor Newsom, a Democrat, is leading the revision of the Environmental Quality Act is directly related to his political future. As California's shortage of dwelling supply has persisted, it has become one of the most expensive housing markets in the United States. The Wall Street Journal (WSJ) reported that California needs 3.5 million dwellings, but only 100,000 dwellings are supplied each year.
The emergence of homeless camps throughout the region, unable to withstand high housing prices, is a serious social issue that is pointed out in every presidential election. From Governor Newsom's perspective, whose term expires in 2026, there was a need to address California's chronic social issues in preparation for a presidential run in 2028, and the revision of the Environmental Quality Act was the first step.
NYT assessed, "It is noteworthy that the Democratic Party led by Governor Newsom is showing signs of distancing itself from this measure, which has long been considered a core value of the Democratic Party." Christopher S. Elmendorf, a property law professor at the University of California, Davis, said, "The policy shift by Governor Newsom is evidence of how high a priority housing policy has become for California voters."