Senate budget committee approves CEQA trailer with $500 million for homelessness funding and a disputed manufacturing exemption

The Senate Committee on Budget and Fiscal Review on Jan. 30 approved AB 1 31, a budget trailer bill that combines housing-focused CEQA changes with a $500 million conditional appropriation for the Homeless Housing Assistance and Prevention (HAP) program and other provisions, despite sustained objections from several senators, tribal nations and environmental and community groups. The committee passed the bill, 13–2.

The bill matters because it changes how and when the California Environmental Quality Act (CEQA) applies to a set of housing, infrastructure and “advanced manufacturing” projects while moving a large, contingent homelessness appropriation through the budget process. Supporters say it will speed housing and infrastructure delivery; opponents say it removes transparency and legal safeguards for tribes, endangered species and environmental justice communities.

Bridal Koli of the Department of Finance told the committee that “This trailer bill includes a 2026–27 appropriation of $500,000,000 General Fund for the Homeless Housing Assistance and Prevention program, also known as HAP, contingent on the enactment of future legislation, including accountability metrics.” Department staff and the bill text also describe a package of targeted CEQA exemptions and a “near miss” approach that limits environmental review in some housing cases to only the narrow issue that prevented a full exemption.

Committee discussion highlighted three recurring flash points:

- Tribal consultation: Several senators and tribal speakers said they fear exemptions could remove the CEQA trigger for AB 52-style consultation. Department of Finance staff replied that CEQA’s tribal…