BERKELEY, California — The revolution is now a fortified construction site.
Just blocks from UC Berkeley, steel boxes and concertina wire ring the storied People’s Park. Behind them: the skeletal frame of a student dormitory, rising where protesters once clashed in one of the nation’s most famously progressive cities.
Neighbors and activists fought the campus housing complex at every turn — including through a novel legal argument: Excessive noise from its boisterous young tenants should be considered an environmental impact under the landmark California Environmental Quality Act.
The project took six years to break ground — and became a symbol of how state legislation Ronald Reagan signed in 1970 to protect air and water and check rampant development was being used to block desperately needed new homes. It also helped hasten the law’s slide — from a pillar of California’s climate leadership to a cautionary tale about the ruling party’s inability to tackle a perpetual housing shortage — that culminated last month in a major rollback.
“That Berkeley thing,” said Jason Elliott, a top housing adviser to Gov. Gavin Newsom in 2023, when Newsom championed a bill to advance the project, “was a clarifying moment for a lot of people of how far afield we had come from the purpose of the original law.”
More than half a century ago, when Republicans were still running the state, Reagan brought CEQA (pronounced ‘see-kwa’) into the world as a shield against unintended consequences: a project that befouled waterways or drove species toward extinction. But the law’s reach expanded through a series of court rulings until it applied to developments of all kinds, becoming a handy tool for almost anyone to challenge a proposed project by demanding more analysis and remediation.
CEQA has long been a bogeyman for Republicans and developers, a symbol of regulatory excess and government dysfunction — and an expensive one at that. But antipathy steadily grew on the left as home prices squeezed urban progressives and forced middle- and working-class families into two-hour commutes or out of the state entirely. The cost of a mid-priced dwelling in California has nearly doubled over the last decade, to around $800,000, more than twice the national average.
The ultimate tipping point arrived last November, when California voters showed their disillusionment with the stewards of the status quo by ousting down-ballot Democrats and delivering President Donald Trump’s across-the-board gains compared to four years earlier. As Trump toured Los Angeles wildfire damage in January, he assailed red tape for stalling rebuilding, and Newsom waived environmental rules to speed the area’s recovery.
This summer, Newsom and like-minded legislators did what was unthinkable just a few years ago: They scaled the law back dramatically, exempting most urban housing developments, along with daycares, manufacturing hubs and clinics. In doing so, they overcame a once-inviolable alliance of construction unions, environmentalists and homeowners that for decades had fought the smallest changes by casting the law as a vital protection aligned with Democrats’ core values on climate and labor.
“If we can’t address this issue, we’re going to lose trust, and that’s just the truth,” Newsom conceded to news reporters last month, going out of his way to thank the leaders of the ascendant Abundance movement focused on boosting production and rejecting a scarcity mindset.
CEQA still lives. It will still generate reviews and lawsuits, and Newsom said he would never have supported a bill “to eliminate the core tenets” of the law. But his decisive support for paring it back says something essential about the long arc of California politics: where the state has been and where its leaders hope to take it now.
CEQA’s Cradle
Reagan gave birth to the California Environmental Quality Act in an era of bipartisan concern about pollution, runaway development, and environmental degradation. The Republican former governor opened the Legislature’s work in 1970 by urging an “all-out war” against pollution, building on President Richard Nixon’s signing of the National Environmental Policy Act.
“The air is going to be cleaner, the water we drink is going to be purer and we are going to alert the people of California to the indisputable fact that the protection of our natural environment must rank as one of our major priorities,” Reagan wrote in an op-ed adapted from a speech.
CEQA was heralded for ushering in a new age of clean air and water in an era when an oil-slicked river in Ohio caught on fire and Joni Mitchell sang about replacing paradise with a parking lot. It was relatively modest at first, requiring government entities to analyze and mitigate the impact of proposed public projects.
But two years later, a court case changed everything. A group of property owners in the Eastern Sierra region of majestic mountains and crystalline water sued to block a proposed development. Warning of issues with sewage, water and vanishing open space, they argued their county had erred in approving a permit — and they had backup from a new environmental unit created by the state’s attorney general, Evelle Younger.
“Evelle Younger, a moderate Republican — remember when we had those? — he charged us with making him look good and doing good on the environment,” said Clement Shute, Jr., then a young attorney for Younger who would go on to become one of CEQA’s most resolute defenders.
The California Supreme Court’s response would shape environmental and housing politics for generations. Justices ruled in 1972 that CEQA applied to private projects if they required a public agency’s approval — in other words, virtually everything.
“Most activity that takes place is private activity, which usually requires a permit from the government, so if you want to make a real difference that has to be included,” said Nick Yost, an attorney who backed the homeowners as a young deputy attorney general.
The impact was immediate. Many projects halted as lenders, builders, real estate agents, and “anybody engaged commercially in putting two sticks of wood together descended on the Legislature in a panic,” then-Sierra Club lobbyist John Zierold recounted in an oral history.
Industry backlash intensified through the years as CEQA continued to expand through various court rulings. In the mid-’70s, Dow Chemical launched a concerted campaign to dilute the law, which it faulted for stalling economic activity, and irate loggers drove their trucks around the Capitol, horns blaring, after a ruling applied CEQA to timber projects.
CEQA has long been “the scapegoat for everything,” said Shute, and “under attack almost constantly” since its inception.
It also enjoyed powerful defenders. A formidable coalition of environmental organizations, homeowners resistant to neighboring high-rises, and above all the State Building and Construction Trades Council — an umbrella for construction workers’ unions that have been known to use the law to negotiate higher wages — thwarted significant changes. They could rely on the backing of Democrats who would come to fully control California politics.
Yet even some of the law’s most ardent supporters eventually had second thoughts about what it had become — including Yost, who this year wrote an op-ed embracing changes.
“It’s one thing to say you should have an intelligent decision by a local government,” Yost said. “It’s another thing to just delay or completely block needed housing.”
The Tipping Point
At People’s Park near UC Berkeley, a monument to the CEQA wars is rising above a discarded symbol of 1960’s counterculture, seven years after the campus first announced contentious plans to build a 1,000-student dormitory and low-income housing there.
The project, delayed by the noise-pollution argument, was one of many examples that had accumulated over the years and soured perceptions of the law. Projects delayed or blocked included a food bank in Alameda, bike lanes in San Francisco, and a daycare center in Napa. The law’s expansiveness makes it especially potent.
“Anyone can file a CEQA suit,” said Sonja Trauss, executive director of YIMBY Law, a group she cofounded in 2017 during a protracted fight over a proposed apartment complex in the upscale Bay Area suburb of Lafayette. “This is what’s so astonishing and catastrophic about it.”
The law is also used for reasons that have little to do with environmental protection. Businesses have invoked it to block competition from moving in. And labor unions can use the threat of a lawsuit as leverage to extract conditions from developers such as wage guarantees or the use of union workers.
Union officials insist the tactic is rare and argue the state’s housing affordability crisis runs far deeper than labor costs or CEQA-related delays. But they also describe CEQA as a vital tool to ensure housing is being built in a way that ensures, the Trades’ leader Chris Hannan said, both “better projects” and “good jobs.”
“I don’t see how anyone thinks this is a winning possibility when it includes undermining environmental standards that are important and that give us leverage to get worker standards,” California Labor Federation leader Lorena Gonzalez said of efforts to streamline CEQA.
Similarly, the law’s defenders argue it often works as intended, with little fanfare, by forcing developers to minimize their projects’ fallout and giving the community a vital lens into what is happening in their community. Last week, for instance, a developer agreed to scale back a proposed project in the sensitive area near Lake Tahoe.
But easy-to-condemn cases like the People’s Park standoff — “right under the law but politically stupid,” as Shute described it — would come to symbolize the law’s general brokenness, frustrating even its staunchest allies.
“You have stories that get repeated over and over to the point that they become (seen as) the pinnacles of truth,” said Kim Delfino, a longtime CEQA advocate who founded the firm Earth Advocacy. “That is more the exception than the norm, but unfortunately those lawsuits are so egregious, they provide grist for the mill — for God’s sake, who the hell challenges a daycare center?”
Yet for years, the status quo prevailed, even as home prices and rents continued to climb. Working groups came and went, and efforts to more narrowly tailor CEQA failed even as California passed a series of exemptions for individual projects like arenas for the Sacramento Kings and the Los Angeles Rams.
In 2013, a trio of former governors from both parties urged then-Gov. Jerry Brown to disarm groups who saw CEQA as a “favorite tool … to stop economic growth and progress.” Brown once called reforming CEQA “the Lord’s work,” but the former Jesuit seminarian could not deliver a miracle. His 2016 proposal to waive environmental reviews for developments containing low-income housing did not receive a single vote.
“The Legislature was passing a lot of special interest legislation that continued to drive up the cost of living,” said former Gov. Gray Davis, but “there was nothing happening in California to reduce the cost of housing — just the opposite.”
But change was coming.
The Political Shift
Attorney Jennifer Hernandez has spent decades working on CEQA cases, spotlighting what she calls the law’s abuses, and advising people working to change the law. Unsuccessfully.
“In an arms control race, who wants to lay down their weapon?” Hernandez said. “You’re talking about a real challenge to political power.”
For years, Hernandez’s car bore the vanity plates “CEQANRD.” More recently, she added a “FIX CEQA” plate — feeling, she said, a “political vibe shift” that made her “more bullish about fixing it.”
She had good reasons. A new generation of Democratic state lawmakers from the epicenter of the housing crisis, like Scott Wiener, of San Francisco, and Buffy Wicks, of Oakland, arrived in Sacramento determined to address a housing crisis that had become existential for their priced-out voters.
Over time, Wicks and Wiener maneuvered to positions of power and influence, leading key committees and forging an alliance with unionized carpenters, giving them a counterweight against the Trades.
“For so many years we’ve been nibbling at the edges because we thought it was impossible when you look at the reality of everyone trying to protect the status quo of what CEQA was,” Wicks said in an interview. “I have a lot of battle scars in this space, and it felt like it took all of these things finally to be able to put this bill out there.”
That new cohort was bolstered by a rising “Yes in my backyard,” or “YIMBY,” movement, powered by young urbanites and funded by tech workers. More recently, the “Abundance” philosophy popularized by Ezra Klein — which also blames bloated bureaucracy for the tight housing supply and high cost of living — captivated Democrats, including Newsom and legislative leaders. Housing advocates capitalized on the prevailing winds to elect allies.
“It required an additional decade or more of trench politics,” said Matt Regan of the Bay Area Council, a business coalition whose leader, Jim Wunderman, is close with Newsom. “Relying on logical arguments got us nowhere for 20 years. We had to win some election campaigns and change the political makeup of Sacramento.”
Those dynamics transformed the Legislature, opening political space to take on a law that was once seen as sacrosanct. “It feels like there are more members of the Legislature in the ‘CEQA is the problem’ camp than there are lawmakers in the ‘bedrock environmental laws are worth fighting for’ camp,” said Jennifer Fearing, a veteran environmental lobbyist.
That emerging majority found an ally in Newsom. The governor used his first State of the State speech to call for expedited CEQA reviews for housing, flexed his executive muscle to compel cities like San Francisco — where Newsom rose to power as mayor — to plan for more housing, and signed a series of bills to streamline construction.
“Reforming CEQA always required the leadership of a governor,” said former Senate President Pro Tem Darrell Steinberg, who led a largely unsuccessful effort under Brown. “When it got really hot and the Trades and the environmentalists pushed back hard, [Brown] chose not to make it a priority. Gov. Newsom chose to lean in, big time.”
Where Reagan vowed to prioritize clean air, Newsom emphasized more homes — and a restoration of the faith in government he said CEQA had helped squander.
Newsom made his move on CEQA in May. His budget plan, he announced, would incorporate sweeping legislation to exempt most housing from environmental reviews. Similar proposals advancing through the statehouse had collided with opposition from labor, environmentalists, and their Democratic allies.
In meetings with legislative leaders, Newsom issued an ultimatum: He was prepared to veto the budget unless lawmakers approved those changes to the law.
“That was a real third rail of Sacramento politics,” said Dan Dunmoyer, head of the California Building Industry Association. “The fact that we have a governor saying, ‘We’re going to hold up the budget if there’s not CEQA reform,’ is a sea change.”
Newsom called the overhaul “the most consequential housing reform we’ve seen in modern history.”
For Newsom and other Democratic lawmakers, a new calculus emerged from the disastrous 2024 election: It is riskier not to act on cost-drivers like CEQA than to antagonize powerful allies.
“The dam broke on the political resistance,” said Dave Rand, a land use attorney and Newsom appointee who provided information to Wicks’ committee on permitting reform. “Democrats reading the tea leaves from the last election, catching the abundance wave, realized this is an absolute necessity.”
Organized labor and their environmental advocates rallied to defeat a last-minute housing proposal that they argued would depress wages for union laborers. But they could not stop a bill to expedite advanced manufacturing projects — despite raising alarms about how it could increase pollution in vulnerable communities — or the law’s larger overhaul, which they believe will primarily benefit wealthy developers with little impact on the cost of living.
“Developers are getting their asks granted now,” said Hannan. “We’ll see if it results in them building.”
‘Big, Big Headwinds’
Supporters believe California has achieved a breakthrough that will make it far easier, and cheaper, to build new homes in cities throughout the state.
“In my lifetime nothing more significant has happened to build housing,” said Davis, the former governor, who described calls pouring into his law firm from eager developers around the country. “People who’d given up on California are now giving us a second look.”
Others are less sanguine. For all the fanfare, the new housing exemptions are confined to certain parcels within cities. And the bill carving out projects like daycare centers and factories didn’t go as far as it could have in making it harder to contest approvals in court.
“There’s a lot of big, big headwinds on housing this doesn’t solve for,” said Ben Metcalf, who was Brown’s top housing official and now leads UC Berkeley’s Terner Center for Housing Innovation.
Environmentalists fear Democrats’ rush to address a political liability is undermining decades of work to battle smog, protect animals, and preserve green spaces.
“We have this sort of collective amnesia about why we enacted these laws in the first place,” Delfino said.
In the meantime, even champions of the overhaul are working to manage expectations, noting CEQA is only one of many factors in a housing market strained by high interest rates and material costs.
Wicks has vowed to carefully track the law’s implementation to ensure it is working as intended. Wiener said in a victory press conference that the bill is not about “the next year or three years, it’s about decades to come.” He has already floated a new exemption for clean energy projects.
Sasha Issenberg contributed reporting.
