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California has rolled back a landmark environmental law in a bid to boost house building.
The regulations have long been blamed for the Golden State’s chronic housing shortage and homelessness crisis.
The move was championed by Governor Gavin Newsom, who argued the rollback would ‘speed up delivery of housing and infrastructure projects’ while still protecting green spaces.
The California Environmental Quality Act was initially passed by then-governor Ronald Reagan in 1970.
The Act ensures that both state and local governments must perform environmental impact reviews before new construction projects can start.
Developers have blamed the bill for allowing ‘NIMBY’ opponents to delay projects for years by tying them up in lengthy and complex challenges.
A lack of housing supply has driven California’s home prices to double the US median, according to figures from California’s legislative analyst’s office.
The state is also struggling with a widespread homelessness crisis.
Newsom said the rollback would ‘speed up delivery of housing and infrastructure projects’
Around 187,000 unhoused people live in the state – a quarter of the entire homeless population in the US – according to the Public Policy Institute of California.
The now hollowed out environmental law has also been blamed for getting in the way of vital rail and infrastructure projects.
‘CEQA allows for potentially unlimited litigation,’ UCLA economist Jerry Nickelsburg told the Financial Times.
‘Production of homes in California just hasn’t been moving.’
The new law exempts most new housing projects in town and city centers from the long environmental review process.
It comes as Los Angeles begins the enormous rebuilding required after swathes of the city were destroyed by wildfires in January.
The fires destroyed around 16,000 buildings and developers and homeowners are having to get creative to speed up the reconstruction process.
Developers have reacted to the law change with glee after years of campaigning for reform.
The regulations have long been blamed for the Golden State’s chronic housing shortage
The California Environmental Quality Act was initially passed by then-governor Ronald Reagan (pictured during his presidency in 1987)
Around 187,000 unhoused people live in California, a quarter of the entire US homeless population
A sign at a homeless encampment in Oakland, California
‘This is major, major reform,’ Sean Burton, CEO of multifamily developer Cityview told The Wall Street Journal.
‘We are thrilled,’ Burton added.
‘A lot of investors have redlined California, now, you’re going to see a lot of people give California a fresh look.’
Other states and cities are being forced to turn to the state of housing availability and affordability.
The housing crisis in New York City was one the main drivers between the shock Democratic primary victory of Zohran Mamdani in his bid to become mayor.
