Sacramento passes hundreds of bills every year. Few are as consequential as Assembly Bill 130 and Senate Bill 131, signed by Gov. Gavin Newsom on June 30.

Those bills reform the California Environmental Quality Act, better known as CEQA, to clear the way for desperately needed housing development.

Economists and housing advocates have long pointed to the supply side of the equation as a significant contributor to the housing crisis. The state has not built enough new single-family homes, condominiums and apartments to keep up with demand.

As a result, too many Californians found themselves priced out of the market, unable to find housing they can afford near where they work. Median home prices reached $868,150 in 2024.

The housing crisis is especially acute among low- and middle-income households. That, in turn, contributed to rising homelessness and people moving out of the state.

The changes enacted by the Legislature and signed by the governor will not solve that problem entirely. Local zoning ordinances limit where construction occurs. Building fees and labor costs also push up prices. But the new rules remove one monumental barrier to building.

CEQA, enacted in 1970, originated with noble intent. Californians wanted development to occur in harmony with the natural environment, not to just bulldoze across it.

That came at a cost. Developers poured large sums into environmental studies and planning to demonstrate compliance.

Often there would be multiple rounds of revisions after public comment and official review. Developers built those costs into their projects, passing them on to homebuyers and renters.

Yet often that wasn’t enough. CEQA also fostered lawsuits. In the early days, environmental groups would file suit against the worst projects.

Eventually other groups figured out that they could do the same. Today, the vast majority of lawsuits come from organizations with no environmental advocacy record. Labor unions have used CEQA to block nonunion developments. Business competitors have challenged rivals. And NIMBYs have prevented infill, affordable housing and homeless shelters from going up nearby.

That changes now. The two bills signed by the governor create sweeping exemptions for urban infill housing developments up to 20 acres. Projects still will have to exclude sensitive areas like wetlands, prime farmland and protected species habitat.

Predictable regulatory review without prolonged lawsuits should lower development costs and allow more projects to go forward more quickly and less expensively.

The exemptions go beyond housing, too. They also streamline reviews for child care centers, health clinics, high-tech manufacturing and more.

Yet how this all came about is troubling. The Legislature received the language for the reforms on a Friday and had to pass them by Monday. If they did not, the state budget would have been invalidated. Operating under threats is no way to pass laws. Indeed, the heavy-handed process endorsed by Newsom was reminiscent of Republicans in Congress forcing through Donald Trump’s “Big Beautiful Bill” with budget reconciliation.

The Legislature has carved out CEQA exemptions before, most notably for stadiums and arenas. This sort of overhaul is different and takes the state into uncharted, though optimistic, territory. If it eases the housing crisis without sacrificing precious natural spaces, this will be a huge win. If it doesn’t, lawmakers and a future governor must be prepared to change course.

Written by the Santa Rosa Press Democrat editorial board.