Prop 45 explained: CEQA overhaul could shift who holds power over building

In 2014, residents and environmental groups argued in a lawsuit that a California Department of Transportation road project planned to run through Richardson Grove State Park failed to properly evaluate how it could harm the redwood trees. It still took courts a total of 15 years to resolve all of the related legal complaints before Caltrans could move forward with building.  

Environmental advocates say the litigation led to changes that better protect redwood trees. But pro-building advocates point to the case as evidence that the California Environmental Quality Act and the review process it requires need an overhaul.   

Proposition 45 , a November ballot initiative that aims to streamline the process, would change how fights like this one play out.  

At the heart of the debate over the measure is who holds power over environmental reviews. Some legal experts say Prop. 45 would shift power away from courts and the public, giving project applicants, who include developers and public agencies building their own projects, more control at key points. For public agencies, including cities, counties and state entities, it’s complicated: an agency could lose discretion when it reviews someone else’s project and gain speed and certainty when it builds its own.

The California Chamber of Commerce, the measure’s sponsor, says the measure would cut costs by speeding up building. Critics say it goes much further than streamlining. 

“This is not surgical at all,” said Ethan Elkind, a climate law expert at the Berkeley School of Law. “This would be a sea change.” 

How does CEQA work? 

California’s landmark environmental review law, signed in 1970, requires agencies to take into account the environmental impacts of a development and help avoid them. 

Over decades, developers have raised concerns about the process, arguing litigation and bureaucracy slow down needed housing. Environmental groups say it gives communities a say in how projects get built.

In response to a housing shortage and high prices, state leaders have moved to ease CEQA’s reach over housing. Most recently, in 2025, Gov. Gavin Newsom signed laws that exempt many housing projects from having to go through a lengthy environmental review process. 

Prop. 45 would reach housing that doesn’t qualify for those exemptions, along with roads, water and other infrastructure projects.

Under the current process, public agencies are responsible for reviewing the potential environmental impacts of projects. Project applicants, usually developers, present an initial study summarizing the expected impacts. The lead public agency overseeing the review decides whether the impacts are significant enough to warrant  more thorough scrutiny. 

Public agencies are responsible for comparing the effects of a range of project alternatives, including a “no project” scenario.

Agencies judge project impacts using environmental standards they choose, covering everything from noise to air pollution, and they can revise those standards as new information emerges.

The public can then submit comments and suggest project alternatives, which the lead agency must consider. Members of the public, environmental groups and other stakeholders can sue to challenge reviews they think are illegal or incomplete. 

Prop. 45 would give agencies 365 business days to decide on an environmental impact report for projects the measure defines as essential, including housing, roads, water, broadband and wildfire mitigation, , and require courts to resolve cases within 270 calendar days. 

Eligible applicants could choose the new procedures or stay with the existing ones.

What supporters and opponents say 

Supporters of Prop. 45 say that the current process causes unnecessary delays and expenses, including the costs of reviewing late public comments and defending against litigation.

Jennifer Barrera, chief executive of the California Chamber of Commerce, said the delays are costly. 

“Time is money, and the delays that we see with regards to all of the red tape and bureaucracy … it could be anywhere from six to 10 years added on to the determination of moving a project forward,” Barrera said. “All those costs are ultimately borne by the consumers.”

Dan Dunmoyer, chief executive of the California Building Industry Association, said the proposition would decrease the cost of the average home by $75,000. 

“If we want to have a society where people can live and thrive, we’ve got to find the sweet spot, and we think Prop. 45 is the sweet spot,” Dunmoyer said. 

Opponents — a coalition that includes environmental groups, some labor unions and the California Democratic Party — say the measure goes far beyond basic streamlining, and gives project applicants too much power, undercutting the point of CEQA.  They say Prop. 45 would strip agencies of the tools they have to protect communities, increase costly litigation and practically eliminate agencies’ ability to enforce the law.

“When you’re undoing or undermining environmental review, or saying you don’t need to do as much environmental review, you can have less community input for a project,”  said Aruna Prabhala, an attorney for the Center for Biological Diversity who works on the opposition campaign.

A power shift?

Prop. 45 doesn’t just make the process go faster. It also changes the rules for project applicants and the government agencies overseeing the review process, according to the Legislative Analyst’s Office, the Legislature’s nonpartisan adviser. 

Applicants could choose just one project alternative for the agency to consider rather than the multiple alternatives agencies assess today. Agencies would have to judge a project’s impacts under the standards in place when the applicant applies, rather than revising them as new information emerges, and list everything an application requires up front. If an agency misses the 365-business-day deadline, the applicant could request a hearing and potentially sue.

The public and courts would have less say. Public comments would be subject to a strict 45-day deadline, and any late comments can’t be entered into the record that a judge could review if there’s litigation. 

Courts could still order agencies to fix flawed reviews, but could stop only the part of a project that failed to comply, not the whole project.

The same rules would apply when public agencies are developers themselves. Agencies building roads or water systems, for instance, would have the option of just analyzing one project alternative and choosing the environmental rules that apply at the time of submission. If they’re sued and a court finds they made a mistake with just one piece of their review, the overall project could still move forward.  

Sean Marciniak, an attorney for Hanson Bridgett, which helped the California Chamber of Commerce write the measure, said agencies would keep the power to reject projects and the measure would not override other planning or zoning laws. 

“This will protect agencies in their decisions,” he said.

Why a county group is sitting this out

Organizations that represent local governments in California, including the League of California Cities and the California State Association of Counties, have mostly stayed out of the debate.

California’s rural counties say they have a problem with building housing, and they’ve historically advocated for CEQA reform.  

These counties often have small populations. They’re strapped for cash and the staff needed to handle the complicated process, said John Kennedy, a policy advocate for the Rural County Representatives of California. 

So when the California Chamber of Commerce proposed a ballot initiative to speed up environmental reviews, Prop. 45 at first looked like a natural fit. 

“CEQA has long been misused and manipulated by a number of interest groups seeking to extract their own interests,” Kennedy said. 

But the group, which represents parts of 40 counties, is sitting this one out. Its leaders voted to stay neutral; Kennedy said he suggested the group oppose it because he thinks it goes too far.  

“Prop. 45 really puts the power in the hands of the project proponents, project developers, and limits local authority to require consideration of alternatives,” he said. 

He worries local agencies would lose control over the standards that decide when noise, dust or runoff is significant enough to require action.  

What Prop. 45 would have changed

In Richardson Grove, had the Caltrans case come up after Prop. 45, Caltrans could have benefited from a 270-calendar-day time limit on courts to resolve the case.  If a court found a flaw, it could stop only the part of the project that fell short.

The case, Marciniak said, also shows how Caltrans could have used existing standards to make the review go more smoothly and quickly. In 2014, an appeals court found Caltrans’ environmental report applied no standard for judging harm to the redwoods’ roots, and noted a state parks handbook with guidelines for protecting trees from construction damage. “There are easy tweaks any agency can make to crystallize meaningful thresholds of significance,” he said. 

Opponents say the case is not typical. It’s rare for a case to take so long, said Doug Carstens, an attorney who often represents environmental groups in CEQA cases. The fixes courts required made the review better, he added.

“In this instance you’re talking about trees, but Prop. 45 could also apply to an instance where there’s people,” Carstens said. “It’s a question of going too far.”

What would it cost, and what would it save

The measure’s backers pitch it as an answer to California’s cost-of-living crisis.

Amelia Matier, a spokesperson for the Prop. 45 campaign, said faster, more predictable reviews would let California build housing and infrastructure at lower cost.

A study by Blue Sky Consulting Group, commissioned by the California Chamber of Commerce, estimates state and local governments and other public agencies would see $1.5 billion in combined savings and additional revenues. 

The Legislative Analyst’s Office estimates that state and local governments and courts would face initial costs in the high tens of millions of dollars annually, potentially more than $100 million, over the first several years, partly covered by fees.

Some costs would likely decline over time, the office said, but long-term impacts are unclear. For instance, faster building would likely lower project costs, but any harmful environmental impacts resulting from quicker reviews would cost state and local agencies more. 

Carstens said the savings aren’t even guaranteed, and that the Chamber of Commerce is using the affordability debate to deregulate in favor of business.

“They say it’s about affordable housing, but that’s not anywhere visible in this measure,” Carstens said. “There’s no affordability provision or requirement for addressing the needs of people who are impoverished and underprivileged.” 

If Prop. 45 passes, much would be left to the courts. The measure says it should be interpreted to give “the fullest possible weight” to approving and building essential projects. Opponents say that would tilt unclear language in favor of applicants. 

Marciniak said the provision is meant for situations the authors couldn’t predict. 

“There is going to be confusion, but I think importantly, a judge in California is going to look at this and understand immediately what it means,” he said.