Updates to CEQA streamlining procedures may make green infrastructure more attainable for Californians.
California is set to receive an estimated $120 billion in federal and state infrastructure funds – including anticipated funding from the federal Infrastructure and Investment Jobs Act (IIJA) and Inflation Reduction Act (IRA). On July 10, 2023, California Governor Newsom signed into law a suite of legislation designed to advance his recent executive order aiming to facilitate sustainability-focused environmental projects.
Legislative Background
While the state’s environmental journey is well established, this particular plan began in late 2022, when Californians from various industries provided feedback on region-focused infrastructure spending. The result was Executive Order N-8-23, and an ambitious review and approval process proposal.
As California seeks to increase funding opportunities to exceed $180 million, this is an unprecedented opportunity to build on the California Environmental Quality Act (CEQA) and to expand on the state’s commitment to protecting the environment now and in the future.
Executive Order N-8-23
California is poised to become the fourth largest economy in the world. Doing so successfully will require agility and forward-thinking to create quality jobs, transition to clean energy, and develop a sustainable transportation network, among other important tasks.
Progress in these areas can be challenging with the complex permitting and regulatory approvals process. Gov. Newsom’s order, signed May 19, 2023, is an important step toward streamlining this process, capitalizing on anticipated federal investments, and seeking to create more than 400,000 jobs in the next 10 years, many in the infrastructure industry.
Within the executive order, Newsom outlines the creation of an Infrastructure Strike Team, composed of various state leaders, including but not limited to:
- Director of Finance
- Director of the Governor’s Office of Business and Economic Development
- Tribal Affairs Secretary
- Director of the Office of Planning and Research
- Secretary of Transportation
- Secretary of Food and Agriculture
- Secretary for Environmental Protection
This team would work with various state agencies to maximize funding opportunities for California’s innovation and infrastructure projects. This may include identifying projects in which streamlining efforts would be most beneficial, particularly those presenting significant challenges and opportunities for infrastructure and job creation.
Additionally, the team would support coordination between federal, state, tribal, and local government regarding project review, permitting, and approvals. A major component of this initiative is to support infrastructure in specific sectors by prioritizing complementary investments in adjacent sectors, e.g., transportation and energy investments that support housing projects.
Legislative Package
Along with his executive order, Gov. Newsom introduced a comprehensive legislative package to reform the infrastructure approval process. Five of the proposals advanced as part of the state’s budget negotiations and were signed into law on July 10, 2023.
Senate Bill 145, SB 146, SB 147, SB 149 and SB 150 seek to accelerate building clean infrastructure to help reach the state’s environmental goals and create jobs. As urgency statutes, all legislative provisions take effect immediately and are effective until 2033.
Senate Bill Summaries
SB 145: Authorizes CalTrans to acquire property for environmental mitigation, purchase environmental mitigation credits, or enter agreements to mitigate environmental impacts from transportation projects or for advance mitigation purposes.
SB 146: Authorizes CalTrans and the Department of Water Resources (DWR) to use the progressive design-build project delivery method for a limited number of public works projects per department with an estimated contract price exceeding $25 million.
SB 147: Authorizes California’s Department of Fish and Wildlife (CDFW) to issue permits to allow certain infrastructure projects to “take” species currently designated as “fully protected” so long as the project fully mitigates the impacts of the authorized take.
SB 149: Addresses moderate CEQA reforms that include a 270-day expedited court review for challenges related to certain water, energy, transportation, and semiconductor projects. The bill also reforms CEQA’s administrative record preparation process in a manner intended to reduce costs and expedite the process.
The bill also extends the Economic Improvement Through Environmental Leadership Act of 2021, which allows the governor to certify certain “environmental leadership development projects” for streamlining under CEQA.
SB 150: Requires the inclusion of workforce and community benefits in labor agreements for state projects with $35 million and above in construction costs. These benefits include local hire provisions, partnerships with high-road construction career programs, and other methods to promote employment of economically disadvantaged areas and veterans.
These bills are intended to facilitate a more expedient process for approving projects and advance the state’s economic, climate, and social goals by maximizing California’s share of federal infrastructure dollars, investing up to $180 billion over the next decade in clean infrastructure and jobs.
Benefits in Tandem
Legal, financial, and bureaucratic challenges can often delay the approval process, even after a successful environmental review. Together, the legislative package and executive order have the potential to cut project timelines and save businesses, state, and local governments hundreds of millions of dollars.
Examples of potentially streamlined projects include:
- Solar, wind, and battery storage projects
- Transit and regional rail construction
- Clean maintenance and bridge projects
- Water storage
- Semiconductor fabrication plants
- Wildlife crossings
Understanding What’s Ahead
While the possibilities surrounding Gov. Newsom’s executive order and recent legislation are significant for CEQA advancements, its many moving pieces mean the future is still uncertain. To ensure your upcoming development or environmental project is on track for future regulations, it may make sense to work with a trusted third-party consultant that can stay ahead of the informational curve.
FirstCarbon Solutions (FCS), an ADEC Innovation, has extensive expertise in assisting our clients with complex environmental liabilities. We provide technical support, funding advice, and regulatory response for clients across various industries and levels of government. Contact us for a free consultation to discuss your current and potential future obligations and how to prepare your response to the latest CEQA regulations.
