Last July, California Gov. Gavin Newsom signed a landmark law shielding apartment and residential projects from lengthy environmental review processes to boost the state’s housing supply and improve affordability.
It’s working – but not without a fight.
Developers wasted no time seizing the opportunity. A growing list of housing developments are securing exemptions from reviews under the 1970 California Environmental Quality Act, which environmentalists and “not-in-my-backyard” groups used to stall or stop projects.
What that does not mean, however, is that local opposition to such projects has no remaining means to ensnare them in a host of other delay tactics and obstructive gambits.
California’s experience offers a preview of what other states exploring similar reforms should expect. New York lawmakers are in the final stages of revamping the state’s 50-year-old State Environmental Quality Review Act, but have faced stiff opposition from the same types of groups that fought the California reform.
A legal fight over zoning
In La Cañada Flintridge, Cedar Street Partners used the new exemption for its 600 Foothill mixed-use project as early as July 3, 2025 – just three days after Newsom signed the bill – with city planning staff confirming it applied.
The project had been tied up in court for several years. Its legal course began in November 2022 when Cedar Street submitted a preliminary application for an 80-unit, mixed-use project, invoking what’s known as “the builder’s remedy” – a state provision that allows developers to bypass local zoning restrictions when a city lacks a compliant housing element.
La Cañada Flintridge pushed back. In May 2023, the City Council rejected the proposal, arguing the city had come into compliance with its housing element before Cedar Street filed. Cedar Street sued that July, alleging violations of the Housing Accountability Act. The California Housing Defense Fund and Californians for Homeownership filed separate suits.
Courts were not sympathetic. In November 2023, an L.A. County judge rejected the city’s attempt to get the case thrown out. Four months later, Judge Mitchell Beckloff ruled the city violated the HAA and ordered it to process the application under the builders’ remedy – the first such ruling in California history.
Newsom and Attorney General Rob Bonta had intervened on the developer’s side.
“La Cañada Flintridge is the latest community that has failed in their effort to override state housing laws,” Newsom said after the ruling. He added the decision should “serve as a warning to other NIMBY jurisdictions that the state will hold every community accountable in planning for their fair share of housing.”
The cost of fighting
Facing a $14 million appeal bond, the City Council voted in March 2025 to drop its challenge. “While this was a difficult decision, prolonged litigation of these issues would have cost significantly more and created an increasing financial burden on the City,” Mayor Mike Davitt said. So far, the city has settled legal fees with the California Housing Defense Fund for $1.26 million.
The law change also removed a potential obstacle opponents could have used to further delay the project. Jonathon Curtis, managing partner at Cedar Street Partners, told The Builder’s Daily that he is now in the capital-raising phase for the project, seeking equity and debt.
Fighting the state capitol’s backyard
The new exemption faced one of its earliest high-profile challenges in East Sacramento, where two neighborhood groups contested a city decision to shield a proposed six-story, 332-unit apartment project on Alhambra Boulevard from environmental review.
The city’s Planning and Design Commission voted unanimously in February to grant the CEQA exemption – the first time Sacramento had used AB 130 – finding the project met the law’s infill criteria. Two groups quickly appealed: Citizens for Positive Growth & Preservation, which has filed three CEQA-based lawsuits against Sacramento since 2015, and a coalition called Save East Sac! Their appeal argued the project conflicted with the city’s general plan and zoning, which, if proven, would disqualify it from the exemption.
“It’s a bad argument that is going to lose,” Chris Farrell with YIMBY Law told the Sacramento Bee. He was right. The council denied both appeals and upheld the exemption April 29, clearing the project to move forward.
A church chooses a CEQA exemption
California’s 2024 law allowed faith-based organizations to build on property they own by right, spurring projects throughout the state. In Danville, Community Presbyterian Church is pursuing a 68-unit townhouse development town planning staff determined was exempt from CEQA under AB 130.
The master plan, designed by Dahlin Architecture, would replace 19 church-owned single-family homes with 49 townhomes and 19 accessory dwelling units. The church selected Tri Pointe Homes as the builder in March after reviewing bids from multiple developers, and the land will be sold to Tri Pointe for development.
The project cleared the town’s Design Review Board unanimously in April and is scheduled for Planning Commission hearings beginning May 26.
Glendale’s near legal battle
In Glendale, the City Council voted 4-1 last October to reject Trammell Crow Residential‘s plan to redevelop a former Sears department store into an eight-story, 682-unit mixed-use complex — including 72 very low-income units — despite the project carrying a CEQA exemption. City staff, the Design Review Board, the Planning Commission and the city’s Planning Hearing Officer had all recommended approval.
The council’s objections centered on scale, design and what members described as a failure to honor the Art Deco character of the historic Sears building. The lone dissenting vote, Mayor Ara Najarian, warned colleagues they were inviting legal and financial consequences. He was right.
Trammell Crow’s attorney called the potential case a “slam dunk” under the Housing Accountability Act. On Dec. 30, the state Department of Housing and Community Development issued a formal notice of violation. It said Glendale was legally required to approve the project and gave the city a deadline to reverse course. If the city didn’t, it faced fines of up to $34 million.
The City Council reversed its denial in late January and approved the project — three months after voting it down. No lawsuit was filed, but Trammell Crow had made clear one was waiting if the council held firm.
The road ahead
The law has shifted the arena of conflict. Under the old system, opponents used the CEQA process itself as a delay tactic – filing challenges, demanding studies and running out the clock.
Now those fights are moving to city councils and the courts, where elected officials have begun to learn the hard way that rejecting exemption-eligible projects could carry a steep price.
“They’ve done an unbelievable job changing the landscape,” he said, but added that judges remain a problem. “Some are still in the mindset that cities can do no wrong.”