Congress’ housing bill isn’t enough to fix California’s problems

This weekend, the most substantive housing bill in decades took effect without President Donald Trump’s signature.

The 21st Century ROAD to Housing Act has been described as the most ambitious federal housing legislation in a generation. Everyone understands that housing is too expensive in many places today because we don’t build enough of it. But the bill does little to fix that.

It ignores the thicket of federal (and federally-inspired state) environmental rules that have effectively outlawed building new, large suburban neighborhoods in areas of the country with the greatest undersupply of new homes.

Until the early 1970s, when an American metro area gained substantial population, developers built a suburb or new town for them. Levittown opened on Long Island in 1947 with 17,000 houses. Phoenix, Houston and Las Vegas mostly still grow outward year after year. Real prices stayed relatively flat, because the perimeters of major cities were permanently under construction.

That stopped almost completely in most of the cities identified today as “unaffordable” and suffering from a lack of homes. Not because we ran out of land — there is still abundant developable land within commuting distance of every congested American metro.

The reason is that, between 1969 and 1980, Congress and many state legislatures enacted a stack of environmental statutes that together function as an effective ban on greenfield development.

The National Environmental Policy Act, the Clean Water Act, the Endangered Species Act and the California Environmental Quality Act (CEQA) together form an iron cage around the perimeter of many American metros.

The environmental statutes of the 1970s did not just protect wetlands and endangered species. They reshaped the geography of American housing politics by abolishing the safety valve that had defused it in previous decades.

The big projects can’t escape.

Newhall Ranch — a planned community of 21,500 new, mostly single-family homes northwest of LA — filed its initial environmental impact report in 1995. LA County approved the overall plan in 2003.

In 2015, the California Supreme Court invalidated the approvals over greenhouse-gas and endangered-fish analysis. The first two villages were finally re-approved in 2017, 22 years after the original filing. The nearby Centennial at Tejon Ranch — about 19,000 homes, approved in 2019 — has been tied up in CEQA litigation ever since.

Smaller projects fare no better.

Consider the story of the last vacant large parcel in Tiburon, California: 110 acres overlooking San Francisco Bay, with a proposal to build a subdivision of 300 single-family homes. The Martha Company began trying to develop the land in 1974. Litigation followed. Stipulated judgments were entered in 1976 and again in 2007, twice reducing the number of homes but purportedly allowing the smaller project of 43 homes to go forward. The county eventually certified a Final Environmental Impact Report in 2017.

A neighborhood group sued again under CEQA. In May 2022, the First District Court of Appeal upheld the approval — and devoted the closing pages of its opinion to a denunciation of CEQA’s “manipulation into a formidable tool of obstruction,” writing that “something is very wrong with this picture.”

That ruling came 48 years after the dispute began. In the end, the property owner sold the property to a trust and to Marin County for open space. Fifty years of environmental litigation, zero homes built.

Or consider Fanita Ranch in Santee, just outside San Diego: roughly 3,000 homes on 2,638 acres of undeveloped land. Santee first approved the project in 2007. Lawsuits voided the approval. The project was revised, re-approved in 2020, sued, re-approved in 2022, sued again, re-approved in June 2025, and sued again a month later.

Four full rounds of CEQA litigation. A suburban subdivision that should have been finished a decade ago is still in court today.

These are the projects everyone forgets in the YIMBY-NIMBY fight. They are not asking to upzone anyone’s single family neighborhood. They are asking to put houses on empty land their owners want to develop. They cannot be built because of the thicket of environmental laws.

With expansion forbidden, every drop of housing demand gets forced onto existing neighborhoods, where the only way to add supply is to upzone someone’s block. That is why our housing politics has become an unwinnable war between people who want density and people who want their streets to stay the way they are.

The escape route is open ground. If America could once again build new suburbs the way it did before the 1980s, the pressure on existing neighborhoods would dissolve, prices would fall and the YIMBY-NIMBY war would lose most of its heat.

The reform we need, at the state and federal levels, is an overhaul of NEPA, the Clean Water Act, the Endangered Species Act and CEQA — the real gatekeepers of American land use.

Larry Salzman is the vice president for litigation and strategy at Pacific Legal Foundation.

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