Attempt to fix California's severe housing crisis offers lessons to US | The Excerpt

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On a special episode (first released on August 1, 2025) of The Excerpt podcast: Across the country, Americans are in need of affordable housing. Can California’s repeal of 70-year-old housing regulations spur much-needed development? Ben Metcalf, managing director of the Turner Center for Housing Innovation at UC Berkeley, joined The Excerpt to discuss the housing crisis.

Hit play on the player below to hear the podcast and follow along with the transcript beneath it.  This transcript was automatically generated, and then edited for clarity in its current form. There may be some differences between the audio and the text.

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Dana Taylor:

Hello, I’m Dana Taylor, and this is a special episode of USA TODAY’s The Excerpt.

Lack of affordable housing is an urgent problem in cities and states across America, but perhaps nowhere is it felt more acutely than in California. That’s where a 55-year-old regulation known as CEQA, the California Environmental Quality Act, has created a lengthy process, a review process that’s been blamed for gumming up the developmental pipeline, but in June, in a move that angered environmentalists, California Governor Gavin Newsom signed two bills that effectively roll back portions of CEQA. What happens now, and will the impact finally pave the way for developers to create the housing so desperately needed? Ben Metcalf, Managing Director of the Turner Center for Housing Innovation at UC Berkeley joins us to talk about what this might mean for housing in California. Ben, thank you so much for joining me.

Ben Metcalf:

It’s my pleasure. I’m very happy to be here.

Dana Taylor:

Set the stage for us here. There’s been a partial rollback of CEQA, the signature law which has largely been blamed for holding up new housing projects. What were the issues CEQA was originally trying to address, and what parts did Newsom effectively repeal in June?

Ben Metcalf:

CEQA was one of a number of state-level sort of environmental protection laws that came into force in the early 1970s, at a time of real environmental activism and a time where there was a real concern that development had been running rampant, and buildings had been getting built in places that were dangerous potentially for the inhabitants or causing real harm to wildlife or habitat. The law itself is actually sort of … on paper, seems very reasonable. It just asks developers of land to do a study, to basically look at their site before they build, and figure out what all of the environmental impacts are likely to be as a consequence of the specific structure that they plan to put there. The idea is that by documenting and disclosing these harms, there’s a daylighting of the process that allows for local governments to decide if they want to ask for changes or for developers to make those changes.

That process has evolved over the last half a century into a bit of a complex regulatory system that has been very much criticized by folks in the building industry, because while it both serves that very valuable disclosure process, it also takes a lot of time to go through a public process of vetting that reporting, and it provides both a hook where local governments have sometimes used it to functionally block development, even though that wasn’t the purpose, and it is a way by which any citizen can litigate, they can file lawsuits saying that that environmental review wasn’t properly done. So it has been blamed as providing a effective veto to any citizen who’s able to file a lawsuit.

Dana Taylor:

After signing the two bills, Newsom called it “the most consequential housing reform that we’ve seen in modern history in the state of California”. Let’s talk about likely impacts. What are you hearing from developers, and how long will people have to wait to see new housing take shape?

Ben Metcalf:

Yeah, so let me clarify, first of all, that the rollback only applies to development that’s happening for … well, primarily for residential housing, so people building new homes, and only really in the context of infill locations. So these are locations that are part of the city that are adjacent to build sites that are themselves sites that were previously developed. So part of the logic here from an environmental standpoint is that although it’s rolling back some environmental protections, it’s actually making it easier to build in the places where we know the environmental impacts are going to be less, and in fact, I think it’s sort of a little bit reflective of a growing awareness that in the 1970s a lot of our interest was on, for example, habitat protection. We were worried about impacts to specific animals, we’re worried about pollution.

I think today, our concern has evolved to be really about climate change, and when you think about development from a climate perspective, really the first and most important thing that you can do is reduce the vehicle miles traveled. The more the people are in their cars driving, the greater the carbon, the greater the climate impact. So if you want to actually have environmental benefit, you want to steer more development towards these infill locations that are going to be more likely to be in compact neighborhoods, closer to transit, closer to existing infrastructure. So there’s a little bit of a bargain that’s being done here where we’re saying, “Okay, we’re willing to have more development.” If we can help more development happen in these infill locations, we’re willing to have a lower standard of concern for the environmental impacts that may happen on a site by site basis.

Dana Taylor:

Do we know how long it’s going to take before some of the actual development begins for this housing?

Ben Metcalf:

So what we do know probably with the most certainty is that all cohort of projects that are now sort of in their, what’s called pre-development stage, they haven’t yet started construction, but they’re trying to get the approvals they need to begin building. A whole cohort of projects in that stage are going to be able to move forward faster and sooner. So if a typical environmental impact review that you would otherwise have to do is going to take four or five or six months, sometimes it takes quite a bit more, then that amount of your timeline is going to fall out. So projects that were sort of already in flight are going to get pulled forward and be able to get in the ground sooner. So I think we have a pretty good certainty that there’s going to be a timing benefit for all of these in-fill residential projects in California going forward. I think what’s a little bit less certain is does this induce new projects to get into the ground to go into development that didn’t previously pencil or didn’t make financial sense.

Dana Taylor:

I’m going to circle back to this. As you said, one group that’s very unhappy with Newsom’s move is environmentalists. What are their biggest concerns today?

Ben Metcalf:

They are very worried that by not doing this process of creating an environmental review, that we just won’t know what we don’t know, that we won’t know if development is going forward in a place that does have a sensitive habitat or will cause significant impacts to other environmental concerns, whether it’s air quality, water quality, or animal habitat. Again, I think the opposition from the environmental groups has been less than might’ve been expected. I think it’s actually quite a bit less than we would’ve seen five or 10 or 15 years ago. Again, I think it’s partly because the environmental movement is increasingly moving away from a concern just on these site-based impacts and more towards this global concern around emissions, carbon, pollution, and I think generally there’s a widespread understanding that residential development is going to happen in a place like California. People are going to keep having kids, there are going to be new jobs getting created, and so it’s in the interest of environmentalists to be facilitative of housing happening in infill area.

I think the devil’s in the details, though, because while environmental groups generally agree they want to help facilitate infill housing, they’re still going to be looking for more limitations, conditions. The bill already does require, for example, there has to be some environmental assessment that’s done. The bill already did say this doesn’t apply for areas that are in flood zones or other certain kinds of very specific fire hazard zones, for example. So I mean, there’s a little bit of compromise that was made in this vision to, I think, defuse some of the opposition, but I think there’s going to continue to be a negotiation review and possibly some future legislative amendments to this over the next year or two.

Dana Taylor:

How might Newsom’s partial repeal kickstart the availability of affordable housing? Do the new laws address the need for more multi-family construction?

Ben Metcalf:

Well, the primary beneficiary of this will be multifamily housing. In these infill locations, multifamily does comprise a larger share of net new residential housing than single family. Both some single family and multifamily both can benefit, but in practice it’ll be more multifamily, and what we do know about multifamily housing is that even when it’s not formally subsidized or officially “affordable”, it does just tend to get priced at more accessible price points and tends to be smaller units.

So look, I think any sort of new supply is going to be helpful. California is way, way, way behind on its overall housing supply. Building permit numbers have been really down for the last 15 to 20 years. So any sort of new supply is going to be helpful, and I think this kind of supply, which tends to be multifamily, which has to be infill, is probably going to be the most helpful for addressing affordability crisis.

Dana Taylor:

California is not alone in its struggles to create more affordable housing. Are there lessons for the rest of the country to be learned from California here?

Ben Metcalf:

Historically, the focus on affordable housing has manifested itself as “let’s create new affordable housing programs”, like “let’s build new public housing or pay for vouchers or low income housing tax credits.” I think what’s interesting here is there’s this awareness that part of the reason, maybe the primary reason that the affordability crisis has gotten so bad is a function simply of a lack of housing at all price points, that simply people have been unable to sort of make the math… Builders have been able to make the math pencil to build new housing of any kind, and so there’s really an idea here that if we want to solve affordability, we have to spur more market rate and private housing.

So it’s interesting, particularly in a place like California. California has a democratic legislature, they have a democratic governor, and what we’re seeing here is really like, “Hey, a deregulatory thrust, let’s actually get government out of the way a little bit so builders can build,” and so I think that’s interesting, because that’s a little bit of a, hey, the Democrats in California maybe arguably attacking to the center. They’re trying to say, “Well, we can both focus on core liberal ideals and help with social safety nets, and also we want to make government work better and maybe get a little bit out of the way when we’re achieving this kind of an important public policy purpose.”

So I think number one, it sort of signals like, hey, maybe there’s a way to move more centrist, let’s call it pro-business or pro-development kind of land use and supply reform laws to a place of California, and I think honestly, a lot of other states are watching what’s happening right now in California. So if you’re a governor in another state, particularly a democratic state that has long had a history of very strong environmental protections, I think you’re looking at this and saying, “Hey, I have an affordability crisis in my state. Should I also be revisiting some of the ways my environmental regulations have worked so that I can sort of have a both end? Both protect the environment, but also help get more housing built in the places where I know that the housing needs to go.

Dana Taylor:

Ben, some politicians are touting this as a solution to the housing crisis. Is that overblown, or will more legislation be needed to incentivize development?

Ben Metcalf:

I regret to say it’s definitively overblown. I think this is a really important step. Like I said, I think it will absolutely speed up housing in California, which is really important. It will slightly lower costs and it will also reduce the uncertainty that comes from that sort of threat of litigation that I mentioned, but at the end of the day, it’s still really expensive to build housing and really hard to build housing, and that has to do with a lot of factors that go well beyond this particular CEQA environmental policy. So until we can figure out ways to make it cheaper overall to build housing, until we can address issues like construction labor shortage, and incredible challenges with material pricing, and unless we can also figure out ways to achieve the life, safety and health benefits that we get from a very strong building code, it’s still going to be very expensive to build that housing. So we have to figure out how to lower those.

We also have to figure out how we can make sure that there are places where building is allowed, and particularly multifamily housing is allowed. Historically in California, there’s been a very strong undercurrent of what’s called NIMBYism. Not in my backyard. People saying, “Hey, I don’t want new housing in my neighborhood. It should go somewhere else.” California has made some progress on that, but there’s still more work that’s needed to basically say to every city in town of California, we all sort of need to take our share of this growth and hopefully direct a lot of it into [inaudible 00:12:24] areas, and where that’s not possible, make sure that it’s happening and sort of compact, more accessible communities proximate to jobs and amenities.

Dana Taylor:

Finally, what’s your biggest takeaway on the national crisis in affordable housing?

Ben Metcalf:

That this is a complicated one, but there’s real dynamism right now, I think, coming from all sides of the political spectrum, to come up with real and meaningful fixes. So we have states like California that have Democrats controlling the legislature and the governorship, but we also have states like Montana, Utah, Arizona, which are Republican controlled, and we have exactly the same conversations going on, and exactly the same energy too. This is one of these rare issues that isn’t super polarized where there really is a possibility for folks to work across the aisle and come up with creative solutions that involve both making it easier to get new housing built and coming up with some ways to really protect the most vulnerable residents who are really right now at real risk of homelessness or seeing their whole paychecks go into really substandard housing.

So that’s an opportunity, and I’m excited with things like what we saw in California to see where this momentum goes and see if it’s augers, more of these sort of creative approaches to look at how we can have government work better.

Dana Taylor:

It’s good to talk to you, Ben. Thank you so much for being on The Excerpt.

Ben Metcalf:

Hey, it’s my pleasure. It was a great conversation. Thanks for taking up this topic.

Dana Taylor:

Thanks to our senior producers, Shannon Rae Greene and Kaely Monahan for their production assistance, our executive producer Laura Beatty. Let us know what you think of this episode by sending a note to podcasts at usatoday.com. Thanks for listening. I’m Dana Taylor. Taylor Wilson will be back tomorrow morning with another episode of USA TODAY’s The Excerpt.

This article originally appeared on USA TODAY: Attempt to fix California’s severe housing crisis offers lessons to US | The Excerpt