Newsom Signs Housing and Development Streamlining Bills

SACRAMENTO — On Monday, Governor Gavin Newsom signed Assembly Bill No. 130 (AB 130) and Senate Bill No. 131 (SB 131) into law as part of California’s 2025-2026 budget. These bills aim to boost housing supply by encouraging development and simplifying processes like environmental reviews and permitting.

AB 130 offers an exemption from the California Environmental Quality Act (CEQA)—a law requiring environmental impact assessments—for infill housing projects. Infill housing refers to building on previously developed land in urban areas. To qualify, projects must meet environmental and zoning standards, ensuring they avoid sensitive or hazardous locations. The exemption is temporary and will end in 2031 unless lawmakers extend it.

SB 131 expands CEQA exemptions to include a variety of projects beyond housing. If specific conditions are met, health centers, childcare facilities, certain manufacturing plants, food banks, farm worker housing, clean water initiatives, wildfire prevention efforts, broadband expansion, and parks can skip CEQA reviews. The bill also tasks the Office of Land Use and Climate Innovation with mapping urban infill sites eligible for housing exemptions by July 1, 2027.

Governor Newsom’s press release highlights these laws as part of a larger effort to streamline development. Alongside the bills, the state is expanding the Permit Streamlining Act for quicker approvals, pausing new residential building rules, increasing oversight of homeless shelters, and more than doubling the Renters Tax Credit. The measures generally gained strong backing from the State Assembly and Senate.

Supporters, including the California State Association of Counties (CSAC), praise the changes. “No longer will CEQA be leveraged to stall critical county wildfire, water, and housing projects. This legislation will make California more affordable for families by helping to alleviate our housing crisis and, in turn, reducing homelessness,” said CSAC President and Inyo County Supervisor Jeff Griffiths. Housing developers and trade groups, like the United Brotherhood of Carpenters, also back the bills. “The Carpenters want to thank Governor Newsom and those legislators that are keeping the housing crisis at the very top of the California legislative agenda,” said Douglas J. McCarron, President of the United Brotherhood of Carpenters.

Environmental groups, however, express concern over weakened protections. In a KQED article, Matthew Baker, Policy Director at the Planning and Conservation League, called SB 131 “the worst rollback of environmental and public health protections” in decades. He criticized the fast-tracked budget process for lacking transparency and limiting community input in planning decisions.