The California Environmental Quality Act (CEQA) is a California statute that requires public agencies to consider the environmental consequences of their discretionary actions and to inform government decisionmakers and the public about the potential environmental effects, and to avoid environmental damage when feasible. Since its enactment in 1970, CEQA has evolved into a very complex and legally fraught process that can be unpredictable and very time-consuming and consequently drives up project development costs and extends permitting timelines.

To many, the original intent of CEQA has been diluted for many reasons. Sometimes it is due to special interest groups intervening and requiring onerous technical oversight, that slows down project development schedules and often is used to derail the project application. CEQA lawsuits after project approval also presents a significant hurdle, especially as the legal bar for bringing such a challenge has historically been quite low. All of this has undermined the intent to use CEQA to reduce environmental impacts while not substantially impeding development opportunities. Given that CEQA has contributed to increases in development costs and timelines, CEQA has been due for more exemption categories and additional streamlining pathways.

The state of California just enacted recent CEQA reforms through two budget reconciliation bills. These legislative updates are intended to reduce regulatory barriers while also streamlining the time it could take to permit certain housing and infrastructure developments. Specifically, California’s Governor signed into law Assembly Bill (AB) 130 and Senate Bill (SB) 131 on June 30, 2025. These new laws include the following key updates to CEQA and the CEQA Guidelines:

1. Permit Streamlining for infill housing designed to help increase production:
   1. New exemptions for housing-rich infill projects, subject to size and height restrictions and compliance with land use designations.
   2. New limits and constraints for reviews of housing projects which fail to meet an exemption. Such projects now focus only on the critical environmental issues that precluded the exemption.
2. Permit streamlining for high-speed rail facilities, linear broadband, certain water, wastewater and utility systems and advanced manufacturing projects, while continuing natural and sensitive lands protections. Advanced manufacturing projects (as defined) located on sites zoned exclusively for industrial uses are now exempt from CEQA. Examples of such projects include manufacturing in the areas of microelectronics and nanoelectronics (including semiconductors); advanced materials; integrated computational materials engineering; nanotechnology; additive manufacturing; and industrial biotechnology.
3. Statutory exemptions from CEQA for other specified projects include: day care centers (not located in residential areas), rural health clinics and other qualified health centers and food pantries, farmworker housing, wildfire prevention, some parks and recreational trails, and updates to the state’s climate adaptation strategy.
4. New 30-day deadlines to act to approve or disapprove qualifying projects.
5. Qualifying projects must still conduct analyses for environmentally sensitive areas, retaining environmental protections, with streamlined processes. This includes certain coastal zone areas, habitat for protected species, wetlands, very high fire hazard severity zones, hazardous waste sites, delineated earthquake fault zones, special flood hazard areas, regulatory floodways, and land dedicated for conservation in an adopted natural community conservation plan or conservation easement (subject to exceptions).
6. Other CEQA reforms provide for the creation of innovative financing mechanisms to attract long-term investment, including a revolving fund to reinvest equity from stabilized affordable housing into new developments. It also excludes the certain internal communications from the CEQA administrative record, updates to the CEQA Guidelines, and a legislative declaration that “CEQA should not be used primarily for economic interests, to stifle competition, to gain competitive advantage, or to delay a project for reasons unrelated to environmental protection.”

While these are just the high notes of the June 30, 2025 CEQA regulatory updates, an in-depth summary of the CEQA updates as well as more technical details can be accessed at the July 16, 2025 National Law Review.

Other recent updates include 2024 SB 69 (Cortese, 2023), which now requires that local agencies electronically file all notices of determination (NODs) and filing notices of exemption (NOEs) with the Office of Land Use and Climate Innovation (LCI) in addition to the applicable county clerk. Additionally, every year, there are new landmark CEQA cases that influence the practice as well as the content of CEQA compliance documents.

Our team of CEQA experts have managed hundreds of complex major industrial projects for a wide range of clients and with many jurisdictions throughout California. We understand what level of detail and which compliance document is appropriate for each jurisdiction; CEQA is not a one-size fits all regulation. CEQA is a tool, not a roadblock, and a regulatory practice that requires deep experience supported by strong technical expertise. If you would like to reduce your permitting risks and timelines, please reach out. We can explore if these new or other applicable regulatory changes could shave time from your permitting and project entitlement timelines.

Please contact Valerie Rosenkrantz or Graham Stephens to explore permit streamlining opportunities that apply to your development projects.