California governor orders streamlining housing development using federal funds

(The Center Square) - California Gov. Gavin Newsom signed an executive order demanding the state streamline housing development and determine how to use federal climate change funding towards housing as a climate mitigation element.

Housing experts note that Newsom’s suggestions could reduce the cost of building housing by as much as 30%.

“Success could reduce the price of building by 10-30 percent,” said Louis Mirante, Vice President of Public Policy at the Bay Area Council, on X. “It’s time to clear out the cobwebs, and this would be huge.”

Newsom’s directive orients building housing as an element of achieving the state’s climate change goals, which he says should enable the use of federal climate funding towards housing production.

“Infill housing development reduces costs by leveraging existing infrastructure, while also decreasing vehicle miles traveled and related greenhouse gas emissions,” Newsom wrote in his order. “Adaptive reuse — a strategy to repurpose buildings for housing where the original purpose of the building is no longer productive or useful — can help expedite infill housing development and reinvigorate downtown corridors in an environmentally-responsible manner.”

The order directs the state to change the building code and permitting process to reduce costs and expand where infill development is possible, use state funding and federal climate change funding towards infill housing and adaptive reuse, expedite accessory dwelling unit permitting, and make it easier to build housing on government land.

“This executive order take a lot of steps to try and align the state’s housing policy with our climate goals,” said Los Angeles Housing Production Institute Director Joseph Cohen to The Center Square. “The processes Newsom has initiated will take a while to play out, and we still need a lot of additional action by the legislature, particularly around [the California Environmental Quality Act] and approval timelines, but I am optimistic that we could see concrete results from this order that will increase the rate of infill housing production.”

California has one of the highest office vacancy rates and worst post-pandemic downtown recovery rates in the nation, suggesting adaptive reuse could keep those properties and districts more viable in the future. With an up to 4.5 million unit housing shortage, and a goal of permitting and constructing 2.5 million more homes by the end of the decade, infill development and adaptive reuse buoyed by state and federal funding and bureaucratic prioritization could make significant strides towards ending the state’s housing crisis.