On June 30, California Governor Gavin Newsom signed the two most recent California Environmental Quality Act (“CEQA”) amendments, Assembly Bill 130 (“AB 130”) and Senate Bill 131 (“SB 131”). The bills collectively create new categories of CEQA exemptions, remove sunset dates applicable to the Permit Streamlining Act, and create a new process for environmental review for projects that do not squarely fit within an exemption. These bills take effect immediately, and each bill can be found here (AB 130) and here (SB 131).

AB 130 Creates an Exemption for Infill Projects and Reinforces the Permit Streamlining Act.

AB 130 Creates a New Exemption for Infill Housing.

The past exemption for infill development was limited to projects of five acres or less and contained ambiguous requirements. (See e.g., 14 CCR § 15332 [requiring that the project site be “substantially” surrounded by urban uses].) AB 130 creates a related exemption and clarifies these requirements. In sum, AB 130 has three basic requirements: 1) the project must be in an urban area; 2) the project’s site must fit within the definition of “infill;” and 3) the project must have some residential use on a site no more than 20 acres.

Projects are within an urban area of less than 20 acres and are within an incorporated municipality or located within an urban area as designated by the US Census. (AB 130 § 59 [Pub. Resources Code § 21080.66(a)(2)].) AB 130 largely requires the project site to be previously developed with urban uses or to have at least 75% of its perimeter adjoining parcels or land within a quarter-mile radius that is developed for urban uses. (See AB 130 § 59 [Pub. Resources Code § 21080.66(a)(1-4)].) In addition to these location-based criteria, further requirements are proposed for urban projects, such as avoiding the demolition of any structure on the historic register. (See e.g., AB 130 § 59 [Pub. Resources Code § 21080.66(a)(7)].)

“Housing development projects” and “urban use” are broadly defined by AB 130. Aside from purely residential developments, AB 130’s definition includes certain mixed-use developments. (See id. [Pub. Resources Code § 21080.66(a)].) Urban use encompasses any current or previous residential or commercial development, public parks, and even parking lots. (Id. [Pub. Resources Code § 21080.66(f)(3)].) As AB 130 creates a statutory exemption, projects are also exempt from the disqualifying provisions that prevent use of a categorical within the CEQA Guidelines, such as the “unusual circumstances” exception. (See e.g., 14 C.C.R. § 15300.2(c).)

AB 130 Removes Sunset Dates in the Permit Streamlining Act.

AB 130 repeals the sunset dates and makes several key provisions of the Permit Streamlining Act (“PSA”) permanent. AB 130 indefinitely extends the provisions that allow for the submission of a “preliminary” project application. (See AB 130 § 18 [Gov. Code, § 65941.1].) The 2030 sunset dates that applied to the 30-day timelines in which an application must be “deemed complete” and the 60 or 90-day timelines in which a project must be approved after CEQA review have also been removed, thereby extending these provisions indefinitely. (See AB 130 §§ 19, 21 [Gov. Code, §§ 65943, 65950].) For projects qualifying under the new “infill” exemption created by AB 130, the lead agency must approve or deny the project within 30 days after completing tribal consultation. (Id. [Gov. Code, § 65950(7)].)

SB 131 Creates a Streamlined Process for Projects Failing to Qualify for an Exemption and New Exemptions for a Range of Projects.

Streamlined CEQA Review for “Near Miss” Projects.

Prior to SB 131, projects that did not qualify for an exemption were subject to a full CEQA review, including an Initial Study (“IS”) briefly analyzing all aspects of a project. (See e.g., Pub. Resources Code § 21080.1(a); see also14 CCR § 15063(a).) Thereafter, if an environmental impact report (“EIR”) was necessary, the lead agency focused on disclosing and mitigating all potentially significant impacts of the project.

Under SB 131, if a housing project would qualify for a CEQA exemption except for a single condition, CEQA review for that project is limited to the environmental effects caused by that specific condition. (SB 131, § 7 [Pub. Resources Code § 21080.1(b)(1)].) “Condition” means a physical or regulatory feature of the project, its setting or a particular effect upon the environment caused by the project. (Id. [Pub. Resources Code § 21080.1(b)(5)(A)].)  As a result, the CEQA document for these projects, including an environmental impact report (“EIR”), only needs to examine the environmental effects that are solely related to the single condition preventing qualification. (Id. [Pub. Resources Code § 21080.1(b)(2)].)For example, if a housing project would destroy a historic resource and be disqualified from using AB 130’s infill exemption, then only that “condition” or aspect of the project destroying the historical resource would be examined.

Additionally, the EIRs for these projects are not required to discuss alternatives to the project or the potential growth-inducing impacts of the project. (Id. [Pub. Resources Code § 21080.1(b)(3)].) However, this limited review does not apply to projects that are not “similar in-kind” to other housing projects within the CEQA exemptions; two or more conditions preclude use of an exemption; the development includes a warehouse over 50,000 square feet or an oil and gas facility; or the project is located on “natural and protected lands.” (Id. [Pub. Resources Code § 21080.1(b)(4)(A-D)].)   

New or Expanded Exemptions Created by SB 131.

Examples of new exemptions established or expanded by SB 131 include:

• Advanced manufacturing facilities on sites zoned exclusively for industrial uses. (SB 131 § 15 [Pub. Resources Code § 21080.69(a)(4)].)

• Installation of broadband underground facilities in public rights-of-way. (SB 131, § 12 [Pub. Resources Code § 21080.51].)
• Updates to California’s Climate Adaptation Plan. (SB 131, § 13 [Pub. Resources Code § 21080.55].)
• Certain maintenance and appurtenant facilities associated with the High-Speed Rail System. (SB 131 § 16 [Pub. Resources Code § 21080.70].)

Notably, SB 131 would also require the CEQA Guidelines to be updated at least every two years to clarify problematic provisions. (See SB 131, § 18 [Pub. Resources Code § 21094.5.5(c)].)

While SB 131 and AB 130, are touted as a much-needed fix to hurdles in housing and infrastructure development, their effectiveness is still undecided. The clarity of these new exemptions will need to be assessed through real-world application and on a project-by-project basis. Nevertheless, these changes reflect a broader policy shift to encouraging development by narrowing the grounds for environmental review and providing greater CEQA exemptions.

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