Official Summary Text
AB 158, as amended, Committee on Budget.
Budget Act of 2025.
Land use.
(1) Existing law, the Governor’s Reorganization Plan No. 1 of 2025 (GRP), which became effective on July 5, 2025, reorganized specified state agencies and departments, including establishing the Housing Development and Finance Executive Committee (executive committee) within the Business, Consumer Services, and Housing Agency for the purpose of centralizing affordable housing finance policymaking across state government. The GRP requires the executive committee to, among other things, work to align state housing funding sources for the creation of a consolidated application for multifamily affordable housing developers and a coordinated review process for the application of funds. The GRP, beginning July 1, 2026, establishes the Housing Development and Finance Committee within the
California Housing and Homelessness Agency, which the GRP also establishes, and transfers the executive committee to the Housing Development Finance Committee effective July 1, 2026.
This bill would state the intent of the Legislature that, in addition to the other duties required of the executive committee created by the GRP to align state housing funding sources, as described above, the executive committee be required to make recommendations to the Legislature regarding improvements the Department of Housing and Community Development may make to optimize loan administration, as specified.
(2) Existing law, the Planning and Zoning Law, requires each county and each city to adopt a comprehensive, long-term general plan for the physical development of the county or city, and specified land outside its boundaries, that includes, among other specified mandatory elements, a housing element. That law
requires the planning agency of a city or county to provide by April 1 of each year an annual report to, among other entities, the Governor’s Office of Land Use and Climate Innovation, formerly known as the Office of Planning and Research, and the Department of Housing and Community Development.
This bill would require an annual report required by its provisions to be prepared using standards, forms, and definitions adopted by the Governor’s Office of Land Use and Climate Innovation, except as specified. The bill would also make a nonsubstantive change to update a reference to the Governor’s Office of Land Use and Climate Innovation in these provisions.
(3) The Permit Streamlining Act establishes requirements for the review and approval of applications for development projects by public agencies. Existing law defines “development project” for purposes of those provisions to include a housing
development project that requires an entitlement from a local agency.
This bill would define “housing development project” for purposes of those provisions.
(4) The California Environmental Quality Act (CEQA) requires a lead agency, as defined, to prepare, or cause to be prepared, and certify the completion of an environmental impact report on a project that it proposes to carry out or approve that may have a significant effect on the environment or to adopt a negative declaration if it finds that the project will not have that effect. CEQA also requires a lead agency to prepare a mitigated negative declaration for a project that may have a significant effect on the environment if revisions in the project would avoid or mitigate that effect and there is no substantial evidence that the project, as revised, would have a significant effect on the environment.
CEQA, for various purposes, including for the purpose of limiting certain exemptions from CEQA, defines “natural and protected lands” to mean sites located within specified locations, including, among other locations, lands protected as preserve areas or reserve lands, as provided.
This bill would instead include in the definition of “natural and protected lands” for CEQA purposes lands that are identified for conservation in an adopted natural community conservation plan, as provided, or other adopted natural resource protection plan.
(5) Existing law exempts from CEQA specified new agricultural employee housing projects and projects consisting exclusively of the repair or maintenance of an existing farmworker housing project.
This bill would make a technical, nonsubstantive change by amending and renumbering the
above-described section of law.
(6) CEQA exempts from its requirements housing projects that meet certain conditions. Under the exemption for housing projects, CEQA requires a local government to notify and consult, as specified, with each California Native American tribe that is traditionally and culturally affiliated with the project site on the proposed project, as specified. For a development project exempt from CEQA pursuant to this exemption, existing law, the Permit Streamlining Act, requires that a public agency that is the lead agency for the development project approve or disapprove the project within 30 days from the conclusion of the consultation process.
Existing law, the Housing Accountability Act (HAA), among other things, prohibits a local agency from disapproving a housing development project that complies with applicable objective general plan, zoning, and subdivision standards and
criteria, or from imposing a condition that it be developed at a lower density, unless the local agency bases its decision on written findings supported by a preponderance of the evidence on the record that specified conditions exist, as provided. When a local agency makes a decision as described above, existing law requires the local agency to provide the applicant documentation describing the reason for the decision within a specified time period.
For a development project exempt from CEQA pursuant to the exemption for housing projects, this bill would instead require the public agency to approve or disapprove the project within 30 days from the later of the conclusion of the above-specified consultation process or the above-specified time period under the HAA.
(7) Existing law, for a proposed housing development project that would otherwise be exempt from CEQA pursuant to a statutory exemption or
specified categorical exemptions, but for a single condition, limits the application of CEQA to the effects upon the environment that are caused by that single condition, except as provided.
This bill would exempt from that limited application of CEQA a housing development project that has a project site or parcel size that exceeds 4 acres, if the project is a builder’s remedy project, as defined, and the project applicant applied, as specified.
(8) Existing law exempts from CEQA any aspect of a housing development project, as defined, including any permits, approvals, or public improvements required for the housing development project, if the housing development project meets specified conditions, as provided. Existing law requires, as one of those conditions, that the project site or parcel size for a builder’s remedy project, as defined, not be more than 5 acres.
This bill would instead require, as part of those conditions, that the project site or parcel size for a builder’s remedy project not be more than 4 acres. The bill would require, if a lead agency determines that CEQA does not apply to an activity pursuant to the above-described exemption and determines to approve or carry out the activity, the lead agency to file a notice of exemption with the Governor’s Office of Land Use and Climate Innovation and the county clerk of the county in which the activity will occur, as specified.
(9) This bill, notwithstanding exemptions from CEQA or the limited application of CEQA to housing development projects, would apply CEQA to a housing development project that meets specified criteria, including, among other things, that the project is located in a city with a population of more than 85,000 but less than 95,000, as determined by the 2020 Census, and a portion of the
parcel where the project is located is within a regulatory floodway, as provided.
(10) Existing law establishes the Homeless Housing, Assistance, and Prevention (HHAP) program for the purpose of providing jurisdictions with grant funds to support regional coordination and expand or develop local capacity to address their immediate homelessness challenges, as specified. Existing law provides for the allocation of funding under the program among continuums of care, cities, counties, and tribes in 6 rounds, with rounds 1 to 5, inclusive, administered by the Interagency Council on Homelessness and round 6 administered by the Department of Housing and Community Development, as provided. Existing law establishes a round 7 of the program and states the intent of the Legislature to enact future legislation that specifies the parameters, as specified. Existing law, effective July 1, 2026, appropriates $500,000,000, as specified, provided that these
funds be disbursed in accordance with specified requirements. Existing law authorizes the Department of Finance to augment Item 2240-001-001 of the Budget Act of 2025 by $8,000,000 to prepare to administer round 7 of the program.
This bill would instead require the department, during fiscal year 2025–26, to prepare to administer round 7 of the program with the goal that initial round 7 disbursements will be available to grantees meeting the statutory provisions for disbursement beginning September 1, 2026, as specified.
(11) This bill would appropriate the sum of $2,106,000 from the General Fund to the Governor’s Office of Land Use and Climate Innovation to support implementation of SB 131 (Chapter 24 of the Statutes of 2025).
(12) By increasing the duties of local agencies, this bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
(13) This bill would declare that it is to take effect immediately as a bill providing for appropriations related to the Budget Bill.
This bill would express the intent of the Legislature to enact statutory changes relating to the Budget Act of 2025.