California Takes YEARS to Build Housing…This Election Could Change That!

The California Environmental Quality Act, better known as CEQA, is a hot topic in California’s housing debate. And this November, we have a proposition on our ballots that proponents say could roll back some of the most burdensome aspects of CEQA, helping increase the housing supply and bring down costs.

But CEQA is complicated. It has been woven into California’s development process for decades, and it affects far more than just housing. Can we really roll back some of these regulations? And if we can, will it actually make a difference?

We must answer these questions, because one thing is clear: something has to change with California’s housing crisis. It is simply too expensive to live here, and despite years of promises and policies aimed at fixing the problem, housing costs continue to rise! So, I’m breaking it all down for you today! What exactly in CEQA, what would Proposition 45 change about it, and how should you vote on it this November?

Background: Why is CEQA a Problem?

Proposition 45 seeks to correct one of the biggest issues in our state: the housing crisis. It centers around reducing regulatory burden on developers by making changes to the environmental review process as required under the California Environmental Quality Act. But to understand what Proposition 45 does and if it is a good policy for our state to adopt, we have to back up to understand what CEQA is and why it has been framed by conservatives as a problem.

For years, the Legislative Analyst’s Office has reported the fundamental cause of high house prices in California is a chronic, decades-long shortage of housing supply relative to consumer demand.[1] And, for years, they have also consistently called out the California Environmental Quality Act, or CEQA, as a major factor in that shortage. Because the very simple question to ask is: why not just build more housing? But, when you begin to realize the layers and layers of regulatory burden that has been heaped on housing developers here, that question actually becomes laughable. 

So, what exactly does CEQA do, and why has it been such a problem for fixing the housing crisis? The main goal of CEQA is to make sure California doesn’t approve development without first considering what that development will do to the environment. It looks at things like air quality, traffic, noise, water, wildlife, greenhouse-gas emissions, and other environmental effects.[2] Now, that intended goal, taken in isolation, is not a bad thing. After all, the environment IS something we should care about and steward.

I do not want development that is going to disregard air quality or traffic or noise. Those things affect our daily lives, but they are also important to maintaining the beauty and wonder of the nature around us! My husband and I go on walks several mornings a week before work, and we are blessed where we live with tons of walking paths lined with trees and flowers and bushes. It is so good for the soul to live among nature, and it is right to preserve nature as much as we can. So, the problem isn’t that California has environmental standards.

The problem is the consequences that have resulted in practice. While the intentions may be to evaluate each development project for environmental impacts, CEQA has instead become a major roadblock to ever accomplishing a building project. CEQA is often used to challenge the very kind of development California says it wants – housing built within existing communities, at higher densities, and near public transportation. Simply put, there are two main problems with CEQA: first, the delays and costs that CEQA litigation can create, and second, the fact that CEQA can be used to challenge and potentially stop housing projects that have already gone through the environmental review process.

Let’s unpack these two problems. The first problem is time and cost. The CEQA process itself can take months or even years, depending on the project. A project may require environmental studies, an initial study, a full Environmental Impact Report, public review and responses to comments…all before the project can move forward. And then, on top of that process, the project can still be challenged in court. All of that takes time and money. Developers are paying for consultants, attorneys, studies, financing and land while they wait to get through the process. And then, if in the waiting it becomes too expensive and uncertain to develop out the project, some projects no longer make financial sense and are abandoned entirely. That means fewer homes get built – because developers are weighing out the regulatory costs they are incurring against the potential revenues of the project, and the homes that do get built can become more expensive in order to help recoup those costs. 

The LAO reviewed CEQA documents from California's 10 largest cities from 2004 to 2013 and found that housing projects requiring an EIR took about two and a half years on average to receive approval.[3] One such example was a project back in 2007 called the Miraflores Senior Affordable Housing Project in Richmond, California. The city’s Community Redevelopment Agency acquired 14-acres that they planned to redevelop into senior housing – some as affordable housing, and some at market rates. The total environmental review for the project took 29 months – over TWO years! In that time, the review racked up $300,000 in costs.[4] So, for one project, to build senior housing units, the redevelopment agency had to wait YEARS and pay hundreds of thousands in review costs. Do you see how this would massively slow housing development, and disincentivize developers from taking on projects that will incur such high compliance costs?

But that is not all, because the second problem has to do with what happens after a project has gone through the environmental review process. You might think, if a developer can plan for the lengthy timelines and high costs, then these challenges can be mitigated. But CEQA can be used to challenge housing projects even after environmental review. The regulation creates a legal pathway for people to further challenge that project in court. These CEQA lawsuits can create additional, significant delays, legal expenses and uncertainty. A project that was ready to move forward can suddenly be tied up in court, and that can make it much harder to secure financing and actually get those homes built.

A 2017 study by Holland & Knight analyzed all CEQA lawsuits filed statewide from 2013 through 2015, and they found that housing was the single largest target of CEQA lawsuits. In fact, 25 percent of all CEQA lawsuits targeted new private-sector housing projects. Specifically in Southern California, approximately 14,000 housing units were challenged through CEQA lawsuits during that three-year period, and 98 percent of those challenged units were in existing communities – so this was not opposition to brand new development out in fields or undeveloped areas, but in existing neighborhoods.[5]

So again, the issue isn't that every CEQA lawsuit is frivolous or that every environmental concern is illegitimate. The issue is that the structure of CEQA creates an opportunity for approved housing projects to be challenged after they've already gone through environmental review — and that litigation can make housing slower, more expensive and more difficult to build.

We can see what this looks like in practice with the University of California, Berkeley’s People’s Park housing project. UC Berkeley planned to build roughly 1,200 units of student housing. But in 2021, the project was challenged in court under CEQA. The lawsuit argued, among other things, that the university had failed to adequately consider the environmental effects of noise from the future student residents. That lawsuit turned into a three-year legal battle. The project was stalled, and UC Berkeley said the delays had driven projected costs up by millions of dollars. It ultimately took a decision from the California Supreme Court in 2024 to clear the way for construction to move forward.[6]

Just consider the significance of this. What should have been a routine expansion for more student housing was tied up in court for years because CEQA gives the legal structure for complaints about noise to stall a project in an entire court battle. While this particular case eventually moved forward, think of the many, smaller projects, not tied to university funding, that would not survive such delays. Those years of delay and additional costs are exactly the kind of consequences that make it harder and more expensive to build housing in California.

What Proposition 45 Would Change

So now we get to Proposition 45. At its core, Proposition 45 is an attempt to make the environmental review process faster and make it harder for CEQA litigation to completely derail certain projects.

The proposition creates a new, optional process for projects that qualify as “essential” projects. Rather than getting rid of environmental review altogether, it changes how that review happens, how long it can take, and what happens if someone challenges the project in court. There are really three major changes I want you to understand.

First, Prop 45 puts tighter deadlines on the government. Like we just talked about, time is one of the main problems under CEQA. Under Proposition 45, state and local agencies would have more binding deadlines for things like determining whether a project application is complete, completing the environmental impact report (EIR), and issuing other permits and approvals. For example, if an agency hasn't completed the EIR within 365 business days, the project applicant can request a hearing and potentially take the matter to court. The measure also establishes deadlines for courts to resolve CEQA challenges and puts limits on the length of public comment periods.

Second, Prop 45 changes some of the rules for the environmental review itself. For eligible projects, agencies would have to tell applicants upfront what information is required in their application, rather than repeatedly asking for additional information or changes. Environmental impacts would generally be assessed using the laws and standards in place when the application was submitted, rather than allowing the standards to change during the review. This is huge, because in the time that these reviews take, new requirements can be added, or by the time changes to an issue raised have been made, new ones have come up. This would change that, hopefully adding to the streamlining effect.

And third, and probably most importantly given what we just talked about, Prop 45 changes what happens when someone sues under CEQA. Right now, if a court finds that an agency failed to comply with CEQA, the court can stop the entire project and require the agency to go back and fix the environmental review. Under Prop 45, the court would have less power to do that. The measure limits what courts can consider in these lawsuits, and if the court finds a CEQA violation, it generally could only stop the portion of the project affected by the problem while the agency fixes the environmental review, rather than stopping the entire project.

So, in very simple terms, Prop 45 does not eliminate CEQA, but it says: if we're going to require environmental review, let's put some actual deadlines around it, limit some of the ways the process can continually expand, and make it harder for a CEQA lawsuit to bring an entire project to a halt.

The Effectiveness of Proposition 45

Now, we have to ask the most important question when evaluating any policy – is this effective? Will this truly help the housing crisis? The way I would answer this is to say that Proposition 45 is a targeted, worthwhile reform that doesn't address the much larger structural problems behind California's housing shortage.

California needs dramatically more housing. The California Department of Housing and Community Development’s current planning numbers call for more than 2.5 million homes to be built over the next 8 years to help reduce housing prices meaningfully in our state. That would break down to building about 312,500 homes per year.[7] But we just do not see that level of volume even able to be approved. From 2019 to 2024, jurisdictions only permitted about 754,000 units, which is roughly 126,000 per year[8] – less than HALF of the projected need! This shows us that getting projects approved and built faster matters.

Proposition 45 directly targets this issue. It imposes tighter deadlines, limits some of the ways the review can expand, establishes deadlines for CEQA lawsuits, and prevents a court from automatically stopping an entire eligible project because of a CEQA violation. That's a pretty logical policy response to the problems we've just laid out.

At the same time, CEQA is only one piece of California’s housing problem. Even if our state makes environmental review dramatically faster, we still have to contend with local zoning restrictions, high land costs, construction costs, financing costs, building and development fees, density restrictions, permitting and entitlement requirements outside CEQA, labor and material costs, and on and on – all of which are still regulated. Proposition 45 doesn't fix those. So, to say that Proposition 45 addresses in full the root causes of high housing costs is not quite true. This would be one step of many steps required to making housing more affordable in our state.

But I think there's an important argument in favor of it. We don't actually have to believe that CEQA is the sole cause of the housing crisis to conclude that making CEQA less burdensome could help. If developers in our state are already struggling to build enough homes, why would we want to keep them stuck in a system where a qualifying housing project can spend years in environmental review and then potentially be stopped entirely by litigation? Removing one barrier doesn't solve every barrier, but that doesn't mean the barrier wasn't worth removing. AND, taking the first step to remove the most obvious barriers could set voters up to continue stripping back the parts of CEQA that severely restrict housing development in our state in the future.

So, is Proposition 45 a silver bullet? No. But could it help? Yes. Is it a reasonable policy response to a real problem? I believe so.

How to Vote in November

At the end of the day, when our leaders talk about California's housing crisis, they like to point to a lot of external factors. They blame high interest rates, construction costs, population growth, investors, developers, and so on. But at some point, we have to be willing to look inward.

California has created a housing market that is extraordinarily difficult and expensive to build in. We have hundreds, if not thousands, of laws and regulations governing what can be built, where it can be built, and how long it takes to get it approved. The harsh reality is that we are never going to undo all of that overnight. Rolling back decades of regulations is going to take time, and there will be plenty more reforms that need to happen. But we have to start somewhere.

Proposition 45 is a reasonable place to start. It doesn't eliminate environmental review. It definitely doesn't say we should stop caring about air quality, water, wildlife, traffic or the natural beauty of our state. It simply says that environmental stewardship shouldn't require a process so burdensome and unpredictable that it prevents us from building the homes and infrastructure Californians desperately need.

There will be more work to do. Proposition 45 won't solve California's housing crisis by itself. But if we want a California where families can actually afford to live, we have to start removing the barriers we've created ourselves. This November, we have an opportunity to take that first step! I hope you'll join me in voting YES on Proposition 45.

References:

[1] Legislative Analyst’s Office, “California’s High Housing Costs: Causes and Consequences,” March 17, 2015, https://lao.ca.gov/reports/2015/finance/housing-costs/housing-costs.aspx.

[2] State of California - Department of Justice - Office of the Attorney General. “California Environmental Quality Act (CEQA),” June 11, 2021. https://oag.ca.gov/environment/ceqa.

[3] Legislative Analyst’s Office, “California’s High Housing Costs: Causes and Consequences,” March 17, 2015.

[4] BAE Urban Economics, Ethan Elkind, Sean B. Hecht, Daniel P. Selmi, Janet Smith-Heimer, Jessica Hitchcock, Paige Roosa, and Chelsea Guerrero. “CEQA in the 21st Century: Environmental Quality, Economic Prosperity, and Sustainable Development in California.” Report, August 2016. https://www.housingworkshop.com/_files/ugd/a71a83_b5f3f5baaa244b41b6dac448c5447a40.pdf.

[5] Hernandez, Jennifer L. “New Holland & Knight Study Links CEQA Litigation Abuse to California Housing Crisis | News | Holland & Knight,” n.d. https://www.hklaw.com/en/news/pressreleases/2017/12/new-holland--knight-study-links-ceqa-litigation-ab.

[6] Christopher, Ben. “California’s Highest Court Rejects ‘People as Pollution’ Argument for UC Berkeley Housing.” CalMatters, March 27, 2025. https://calmatters.org/housing/2024/06/berkeley-peoples-park-ceqa-supreme-court/.

[7] California Department of Housing and Community Development. “RECENT LEGISLATIVE ACTIONS TO INCREASE HOUSING PRODUCTION IN CALIFORNIA,” February 2025. https://shou.senate.ca.gov/system/files/2025-02/recent-leg-actions-factsheet-updated-feb-2025_0.pdf.

[8] Whisenhut, Ryan. “2024-109 California Department of Housing and Community Development.” California State Auditor, July 30, 2026. https://www.auditor.ca.gov/reports/2024-109/