California Gov. Gavin Newsom was forced to sign a pair of bills, gutting portions of the state’s green agenda law that restricts new home construction.
The move was a rare retreat for the liberal governor as the state’s housing crisis continues to spiral.
The legislation, passed with bipartisan support, rolls back parts of the California Environmental Quality Act (CEQA).
The CEQA has long been considered one of the most burdensome regulations in the country.
It exempts certain high-density housing and infrastructure projects from the law’s complex and time-consuming review process.
Newsom has faced mounting pressure from both parties and voters frustrated by the state’s affordability crisis.
He threatened to hold up California’s entire budget unless lawmakers delivered the CEQA reforms to his desk.
They did just that, and the governor signed the legislation swiftly.
“Today’s bill is a game changer, which will be felt for generations to come,” Newsom said in a statement.
The Democrat governor, who has repeatedly touted California as a model for progressive governance, conceded in a Monday evening press conference that his administration’s credibility is on the line.
“If we can’t address this issue, we’re going to lose trust, and that’s just the truth,” Newsom said, according to The New York Times.
“And so this is so much bigger in many ways than the issue itself.
“It is about the reputation of not just Sacramento and the legislative leadership and executive leadership, but the reputation of the state of California.”
Newsom first promised to fix the state’s housing shortage back in 2018 when he ran for governor.
Now in his second term and widely viewed as a 2028 Democratic presidential hopeful, Newsom is facing criticism that his lofty pledges have produced little real-world improvement.
The original CEQA law, signed in 1970 by then-Gov. Ronald Reagan, was initially meant to apply to government projects.
But a 1972 court decision dramatically expanded its reach, allowing private development projects to be targeted with lawsuits and delays.
Critics across the political spectrum have long blasted CEQA for enabling environmental activists, labor unions, and NIMBY residents to exploit the review process to block or delay housing developments and critical infrastructure, often for political leverage or self-interest.
The rollback represents one of the most significant changes to CEQA in decades.
It’s drawn fierce opposition from environmental groups, who argue that the reforms are a direct attack on the state’s longstanding climate and land-use protections.
“This bill is the worst anti-environmental bill in California in recent memory,” a coalition of environmental groups wrote in a joint letter to lawmakers.
“It represents an unprecedented rollback to California’s fundamental environmental and community protections at a time in which the people of California grapple with unprecedented federal attacks to their lives and livelihoods.”
Despite the criticism from the environmental lobby, the legislation marks a rare moment of consensus in the state’s bitterly divided legislature, as lawmakers from both parties signal that CEQA’s regulatory overreach has become a roadblock to progress.
With housing prices at record highs, homelessness exploding, and middle-class families fleeing the state, Newsom’s shift on CEQA could be seen as a tacit admission that California’s own “green” regulations are now part of the problem.
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