Executive Order Suspends Environmental Permitting and Review Requirements for Fire-Damaged Areas

Understanding Executive Order N-4-25 and EO-N-9-25

On Jan. 12, 2025, California Gov. Gavin Newsom signed executive order EO-N-4-25 to waive permitting and review requirements under the California Environmental Quality Act (CEQA) and the California Coastal Act to allow victims of the recent Los Angeles-area fires to restore their homes and businesses as quickly as possible. Subsequently, on Jan. 16, 2025, the Governor signed EO-9-25, extending the waiver of CEQA and the California Coastal Act to the building of accessory dwelling units to assist in creating more temporary housing. 

CEQA typically applies to state, regional, or local public and private projects that require an agency’s discretionary approval. It also applies to activities undertaken by governmental agencies and activities financed in whole or in part by a governmental agency. 

Newsom states that the executive order will help cut permitting delays, as well as assist state agencies in identifying additional means for streamlining the rebuilding and recovery process. CEQA serves to publicly disclose any significant environmental effects of a proposed discretionary project through initial studies, negative declarations, mitigated negative declarations, or environmental impact reports.

At its core, CEQA is meant to prevent or minimize environmental damage by recognizing effects and developing alternatives and monitoring measures. State and local public agencies must comply with CEQA requirements before making a discretionary approval or a project. This is typically done by preparing an environmental analysis, such as an environmental impact report (EIR), or utilizing a CEQA streamlining procedure. Under the EO, these typical means of compliance are suspended.

Similarly, the California Coastal Act guides how the land along the California coast is developed or protected from development. It emphasizes the importance of public access to the coast and preserving the sensitive coastal and marine habitat and biodiversity. 

Executive order N-4-25 suspends both CEQA review and the California Coastal Act permitting for reconstruction of properties substantially damaged or destroyed in the recent wildfires. It only applies to properties and facilities that are in substantially the same location and do not exceed 110% of the footprint and height of, properties and facilities that were legally established and existed immediately before the fires. However, in an effort to expand available housing options, the Governor expanded the waivers to the creation of certain new Accessory Dwelling Units on any residential property substantially damaged or destroyed as a result of this emergency.

Additionally, agencies must identify additional permitting requirements that can be safely suspended or streamlined to accelerate rebuilding and assist in affordability. EO N-4-25 also will extend protections against price gouging on building materials, storage services, construction, and other essential goods and services until Jan. 7, 2026, in Los Angeles County. EO-N-9-25 extends protections against price gouging for rental housing in times of emergency, and the prohibitions against eviction of a residential tenant and re-letting the unit at a higher price until March 8, 2025, for Los Angeles County. Newsom added that his office is committed to working with the legislature to identify statutory changes that can help expedite rebuilding efforts while enhancing wildfire resilience and safety.

The situation is constantly evolving as wildfire circumstances change. FirstCarbon Solutions (FCS) clients can rest assured that FCS is monitoring the situation and will provide guidance as information becomes available.