🏡💚 The fight over CEQA in this year's budget

On Wednesday, representatives from the State Building Trades, the California Environmental Justice Alliance, and the Center for Biological Diversity held a press conference in Sacramento. While it is often hoped for, this trinity of labor, EJ, and Big Green environmental groups don’t often stand together united on an issue. But this week, they are sounding the alarm about major changes to housing policy that are being jammed through the state’s budget process.

This fierce opposition comes as we approach the deadline for the legislature to pass this year’s budget bill, which could be voted on as soon as today. The budget bill is often used for political shenanigans, attaching significant policy changes to a must-pass bill. This year, it is the political battleground for the latest fight in the longstanding CEQA wars.

The California Environmental Quality Act (CEQA) is a landmark environmental protection law that lays out a process for environmental and community review of proposed developments, including major infrastructure, warehouses, industrial facilities, and housing. For years, it has also been vilified as a major obstacle in the construction of new housing.

Many of you are probably quite familiar with the debates about CEQA and housing policy, but for the uninitiated I will give my own (very simplified) explainer. Critics of CEQA typically argue that this—perhaps well-intentioned—process of review has been used to hold up housing construction throughout the state. The permitting process is timely and expensive, and the process itself provides intervention points for a wide array of groups to intervene and stop a project from happening. They will point to examples of wealthy NIMBYs (Not In My Backyard) stopping new housing, or cases where people cynically use CEQA for reasons that have nothing to do with environmental protection or environmental justice.

Supporters of CEQA show the multifaceted benefits of this kind of review, which helps ensure new projects are safe and don’t create undue burdens on poor communities. It’s often the one tool that marginalized environmental justice communities have to make sure their voice is represented in proposals that would place more polluting infrastructure in their neighborhoods. The CEQA process ensures that we take into account a project’s impact on the environment, thereby helping to protect fragile ecosystems and sensitive habitats.

In the past, these debates have been resolved through negotiated policies that exempted (or “streamlined”) housing from the CEQA process as long as they met certain socially beneficial conditions, such as a certain level of affordable units, labor standards, and siting in areas that promote density. But this year featured two controversial bills that aimed to significantly overhaul CEQA — SB 607 (Wiener) and AB 609 (Wicks). As a very short summary of both: SB 607 would weaken CEQA for a wide range of infrastructure projects, everything from shopping malls to freeways, while AB 609 would exempt most urban housing projects from CEQA.

These two bills were making their way through the legislative process, stirring up debate and bringing out advocates on both sides. Then, during his May Revise budget, Governor Newsom pledged to include these in his budget, removing them from the full legislative process and putting them in the must-pass bill. That is playing out right now, but it remains to be seen if these proposals make it through the last-minute negotiations.

This was all even further complicated by another wrench thrown into the negotiations seeking to set wages for construction workers, wages that the Building Trades argue would undercut hard-fought labor standards. Lawmakers have been thrown off by this new proposal — at an Assembly budget hearing on Wednesday, Assemblymember Chris Rogers said, “I didn’t come to Sacramento to cut people’s wages.” Others voiced concern that the Trades were not consulted in this, and that this significant overhaul in the construction industry was being tossed into the bill in the final hours.

All of this led to the press conference on Wednesday. The speakers not only highlighted their own opposition to these proposals, but pointed to a new poll which found that 75% of California voters support CEQA. They forcefully argued for these policies to be taken out of the budget bill, and allow them to be debated transparently through the legislative process.

And so we come to the final day(s) of this budget bill, where controversial policy is set behind closed doors in a process mostly obscured from the public. Not to be lost in the shuffle is the fact that another controversial bill that would prohibit any updates to building codes until 2031 (AB 306) was also inserted into the budget bill.

I agree that including these proposals in the must-pass budget bill is a bad way to make policy. But I also don’t personally care that much about arguing over procedure — if something I really liked was included in the budget bill, I would be thrilled. This ultimately comes down to a political fight about the future of housing and environmental policy in the state.

And truthfully, I find the debate about CEQA very frustrating. Not that it’s not important, but that it narrows the scope of debate to an almost ridiculously simplified question — do you think CEQA is good or bad? Answering this question becomes a flamewar between advocates who both believe to their core that they are fighting to solve the housing crisis. This has long simmered between YIMBY groups (Yes in My Backyard) and tenant, community, and EJ groups, and has entered onto the national stage through the ascendant “abundance agenda” narrative.

There’s a real need for a much more comprehensive and holistic approach to the housing crisis that does not solely focus on the supply-side question of new housing production. That’s one important factor, though I would argue that ‘cutting the red tape to unleash the market’ is not going to deliver affordable housing for everyone that needs it. More than just new construction, we need to simultaneously act to protect tenants who are right now facing evictions and skyrocketing rents. We also need to preserve the existing affordable housing that is falling into disrepair, or increasingly being bought up and flipped into market-rate housing that is unaffordable to the people who used to live there.

But beyond just expanding the range of policy options, there is a question of what we believe the root cause of the housing crisis is. For some, it is a problem of an overly sclerotic government bureaucracy that prevents the housing market from building new construction. Through our campaign for green social housing, we see the problem as much deeper. The fundamental challenge is that housing is treated as a commodity, a speculative asset that is to be bought and sold for profit to the highest bidder. Free market logic will not be able to address the housing crisis because it’s not profitable to build affordable housing for people who are on low- or fixed-incomes. To make housing a human right, we need to make a public commitment to take land and housing off the private market, and secure it permanently in the public interest.

There is a lot more to say on this, and there will be a lot more time to say it — this discussion is increasingly taking center-stage in national politics, from arguments over the future of the Democratic Party, to fights over the true meaning of Zohran Mamdani’s incredible win in the NYC mayoral primary.

But for now here in California, these next few days may play a huge role in shaping the future of those debates. Stay tuned.  

Questions about the fate of CEQA as we wait for the final budget bill. Source: KCRA

WHAT WE’RE READING

• Newsom and Legislature tangle with construction unions over minimum wage (CalMatters) - a lot more info here on the labor standards proposal and budget debate

• Environmentalists, Labor Groups Urge Halt to CEQA Rollback (Davis Vanguard)

• California budget approval comes with a catch: housing, labor, environmental overhaul (KCRA)

Feel free to reply any time! I always enjoy hearing from people and getting any feedback/questions/additional thoughts.

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