Local Government
Study: Blame Cities, Not CEQA for Housing Shortage

Study: Blame Cities, Not CEQA for Housing Shortage

By Avery Bisset.

The oft-maligned California Environmental Quality Act (CEQA) may not be to blame for the Golden State’s housing shortage and steep development costs, according to recent UC Berkeley/Columbia working paper.

Passed in 1970, CEQA requires state and local agencies to assess the environmental impact of projects and, if possible, mitigate these impacts. While some argue it merely protects the environment, CEQA has attracted critics from both sides of the political spectrum. It’s blamed for contributing to the state’s insufficient housing stock and some argue it has resulted in frivolous red tape and litigation that bogs down and deters development.

According to the study, however, CEQA doesn’t come into play unless approval of the development is at the discretion of the local government.  “As of right” development – projects that need only to meet zoning and planning regulations – do not generally trigger the CEQA process.

In the five cities studied – Oakland, Palo Alto, Redwood City, San Francisco and San Jose – only 23 of 287 projects required a full environmental impact report.

The crux of the problem is that all the cities studied required discretionary review for residential projects. Some of the cities maintained minor exemptions, such as for single family homes, while San Francisco had no exemptions. Combined with the inefficiencies resulting from the byzantine review processes of these cities, developers face significant hurdles when embarking on projects.

“A single project might need to obtain Design Review approval and a Minor Variance from the Director of the Planning Department and a rezoning from the City Council. This requires navigating multiple levels of local government where only one approval process would be sufficient to pull the project within the scope of local discretion.”

The result is that more land use/planning approvals were issued than the number of projects. Additionally, parceling up the land would lead to even more review processes.

Even when cities use the same regulatory tools, the outcomes can vary drastically. Both Oakland and San Francisco rely on Community Plan Exemptions to mitigate CEQA compliance obligations. Yet the process takes only 7 months in Oakland, as opposed to 23 months in San Francisco.

The authors concluded that “these five local governments are choosing to opt into CEQA through their choice to embed discretionary review into the entitlement process,” and “the problem (and potential costs) associated with environmental review do not appear to originate with state environmental regulation.”

The implications of the study are a bottom-up and local focus might do more to ameliorate the state’s affordable housing shortage than the more popular top-down, “reform CEQA” approach.

“This is much more than CEQA,” Eric Biber, one of the study’s authors, told the L.A. Times. “Really if you just went after CEQA, you’re not going to solve the problem.”

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