Why California Can't Build Reliable and Affordable Essential Projects

This Holland & Knight report represents the one of the most comprehensive studies of California Environmental Quality Act (CEQA) appellate outcomes to date, covering 498 published and unpublished decisions from 2013 to 2023. The study found that nearly two-thirds of challenged projects were infill development, while residential projects represented the largest category of appeals (25.5 percent) and infrastructure needed to support development was also frequently challenged. The findings reflect a larger appellate caseload than previously recognized and point to a CEQA litigation burden that continues to delay projects for years, complicating California's efforts to expand housing and modernize critical infrastructure.

Enacted unanimously by a bipartisan legislature and signed by then-Governor Ronald Reagan in 1970, CEQA is a catchall statute requiring state and local agencies to consider environmental impacts before approving or undertaking a construction project, plan or regulation applicable to a construction project or the physical environment. Any person or entity that disagrees with an agency's decision to approve or undertake a project that is subject to CEQA can file a lawsuit in state court. CEQA trial and appellate court proceedings typically take about five years to complete, and while litigation is pending, most approved projects are stalled.

Among the study's key findings:

• Housing remained the top target of CEQA appeals, accounting for roughly a quarter of all cases in the 11-year study period. More than one-third of all challenged residential projects were multifamily or mixed-use developments. Among projects categorized by location, nearly two-thirds (64 percent) of challenged projects were "infill" development within existing communities, while only about 11 percent were located on previously undeveloped county land.
• Environmental impact reports (EIRs) – the most detailed, time-consuming and costly form of CEQA compliance – were involved in roughly 53 percent of appellate decisions. EIRs were challenged far more frequently than any other CEQA compliance pathway and were found deficient in 23 percent of decisions.
• Agencies prevailed in an average of 75 percent of appeals in the updated study, up from 56 percent in Holland & Knight's 2015 study. Notably, agencies prevailed in 80 percent of unpublished decisions compared with 70 percent of published decisions, meaning agency wins were more likely to appear in decisions that cannot be cited as judicial authority in subsequent CEQA lawsuits.

The report highlights a growing disconnect between California's policy goals and its permitting and litigation system and recommends major reforms aimed at preserving CEQA's environmental protections while reducing litigation-driven delays and creating greater certainty for essential projects. Among these recommendations is the passage of California Proposition 45, which is on the ballot in November 2026. Proposition 45 would seek to establish clear, enforceable timelines for environmental review, permitting and litigation for essential projects such as housing, clean energy, water, transportation, healthcare, education, broadband and wildfire prevention – while maintaining California's environmental and worker protections.

Read the full report or find it on ISSUU.