The California Environmental Quality Act (CEQA) was signed by Governor Reagan in 1970. It mandates that before a public agency approves a project over which it has discretion, it must study the environmental effects, disclose them publicly, and require that significant problems be mitigated if feasible.
The review process requires an initial study that will produce one of three outcomes:
- Projects that meet exemption criteria can skip the initial study.
- Projects that the initial study determines will not cause significant unmitigated effects receive a negative declaration. This affirms the project will not create a significant adverse effect on the environment.
- Every other project requires a full environmental impact report (EIR) before it is approved.
In practice, almost all projects are exempted from the initial study or receive negative declarations. Only about 1 percent, roughly five hundred a year statewide, require a full EIR.
However, CEQA is involved almost any time a government agency exercises discretionary approval, covering projects from housing and highways to water, energy, and transit. This means that nearly every project is exposed to lawsuits or criticism that could cause delays.
Why does one environmental law touch everything?
There are two design features of CEQA that make it problematic.
The first is breadth. “Project” and “discretionary approval” cover most things requiring government permission, from apartment buildings to bike lanes to university enrollment plans.
The second is enforcement. CEQA is enforced almost entirely by lawsuit, and anyone can sue over an allegedly inadequate initial study or EIR. While CEQA provides transparency, that transparency also provides a leverage point for neighbors, unions, and other special interest groups to weaponize the regulation for their own purposes.
As a result, the mere threat of delay can inhibit potential projects, producing a chilling effect on projects that Californians need as well as the corresponding economic growth.
Does CEQA actually block many projects?
It’s uncertain how many projects CEQA blocks. The question is hotly contested.
The cost imposed by CEQA EIR approval timelines is the least controversial issue. EIRs that are contested by external parties routinely take years to complete because courts have declined to enforce a nominal one-year statutory limit allowed for CEQA review.
Rose Foundation–commissioned reports have consistently found low litigation rates; the most recent estimated that 1.9 percent of projects requiring CEQA environmental-review documents faced litigation from 2013 through 2021.
However, practitioner studies from Holland & Knight find that lawsuits disproportionately target infill housing and that the threat of a future lawsuit and its associated costs changes the scope of the projects that are filed.
Both findings are likely true within their own domains. Litigation affects a small share of CEQA-reviewed projects overall, while housing and infill projects account for a substantial share of the lawsuits that are filed.
Lawsuit counts also cannot show how often the threat of litigation causes a project to be redesigned, delayed, or abandoned before a case reaches court.
What has changed recently?
AB 130 (2025) exempted qualifying infill housing from CEQA, and SB 131 (2025) narrowed review criteria for “near-miss” projects, those that met all but one condition for a CEQA exemption.
SB 131 also exempted certain health clinics, childcare facilities, food banks, and advanced manufacturing projects from CEQA review.
In November 2026, Californians will vote on Prop 45, a ballot initiative that, for “essential projects” involving housing, water, clean energy, transportation, and health, would shorten agency deadlines, narrow the alternatives analysis, and limit opportunities for litigation.
After fifty years of tinkering around the edges of CEQA, the law’s core mechanics now seem to be squarely in play for reform.
What should a voter remember?
CEQA is a procedure, not a standard. It requires studying and disclosing potential problems; it does not simply mandate choosing the environmentally friendly option.
Its costs show up as delays in project start times, shifted project scope, and litigation risk. Its benefits show up as disclosure, mitigation, and an opportunity for affected communities to express their concerns.
Every proposed CEQA reform effectively asks the same question: Who should be able to slow a project down, for how long, and at what burden of proof?
