📰 What Happened: In a major shift, California has removed most infill urban housing from review under the California Environmental Quality Act (CEQA). Passed as part of the 2025 state budget and signed by Governor Newsom, the new law ends CEQA’s application to projects that meet density, zoning, and site requirements, eliminating a major regulatory roadblock to housing production.

🔍 A Closer Look: The change exempts qualifying multifamily from environmental litigation risks and complex impact studies tied to CEQA. The law includes carveouts for tribal consultation, prevailing wage requirements on affordable housing, and union labor rules for buildings over 85 feet. While the exemption applies to projects under 20 acres, most urban developments qualify.

🧠 Why It Matters: With California facing a severe housing crisis, this marks a historic rollback of the state’s most cited barrier to urban development. While it won't resolve all cost and financing challenges, developers and pro-housing advocates believe the streamlined approvals could speed up delivery of market-rate and mixed-income housing across the state’s cities.