California Chamber’s Barrera says environmental review streamlining will boost housing & growth

The Building an Affordable California Act (BACA), sponsored by the California Chamber of Commerce (CalChamber), is a ballot measure designed to streamline and modernize the construction of essential projects and could result in a multibillion-dollar boost to California’s economy, add new jobs and revenues to help pay for vital government programs, according to Jennifer Barrera CalChamber CEO.

The measure is close to receiving enough signatures to be up for voter approval in November, Barrera said.

Speaking to the Propeller Club of Northern California on April 7th, Barrera argued in favor of streamlining environmental approvals mandated by the California Environmental Quality Act (EQA):” Our state has so much potential that’s being locked up by well-intended but outmoded processes, and the Building an Affordable California Act will be a catalyst toward making the state a more affordable place to live and work.”

The “measure would establish strict deadlines for environmental review and judicial proceedings under CEQA (California Environmental Quality Act). Public agencies must determine whether an application is complete within 30 days of receipt, or the application is automatically deemed complete. Once complete, the lead agency must decide within 30 days which type of environmental document to prepare. The ballot measure would impose firm timelines for completing CEQA review,” according to the law firm Best, Best & Kreiger.

A review by California’s nonpartisan Legislative Analyst’s Office (LAO) found evidence of economic benefits of BACA.

PMSA Supports BACA Initiative

Introducing Barrera at the Propeller Club event was Mike Jacob, President, Pacific Merchant Shipping Association (PMSA), representing marine terminals and ocean carriers at West Coast ports. Jacob said the BACA initiative was vital to speed up approvals for port and infrastructure projects in California: “And so, we are trying to constantly engineer environmental risk out of our system and it's very, very expensive. It is very, very time-consuming. And what happens is we end up, more often than not, either delaying projects that should have been approved without delay or stopping projects entirely that actually had a lot of economic purpose … So, they don't occur. And so, when we have been addressing affordability issues, one of the questions that has come up that the Chamber's tackling is how to translate the concept of affordability into some sort of concrete action that will help people make investments in their state.”

Importance of Ports

Jennifer Barrera said ports can be a major beneficiary of the BACA initiative: “I often highlight the ports as one of the huge assets of California, and it absolutely is the economic engine that our ports are, and the value that they provide is such a unique asset to California that we need to continue to invest in and protect.”

Barrera cited the partnerships between CalChamber, and the ports spearheaded by Susanne Stirling, Senior Vice President, who has headed CalChamber’s international activities: “I would echo Susanne Sterling, I will just channel her for a moment if she were here … she's quite amazing and has been at the Chamber for over 30 years on our international trade side. And she does a remarkable job with regard to all the trade discussions, specifically, obviously focused on the supply chain, the ports, and the free trade.”

Affordable Housing

Barrera said when CalChamber started evaluating the idea of a ballot initiative, “I will be candid that we (were) initially just looking at it from a housing perspective. I have been at the Chamber for 15 years now, and we have a lot of housing advocates and builders in our membership. And I've been hearing from them since Day One about how hard it is to build housing in California. And eventually when I was looking at affordability, the issue of housing, and many of you are familiar with this, the average price of housing in California is around $900,000, which is completely out of reach for so many of our next generation, our children who are struggling … to figure out how are they going to afford to live here in California. And you see a lot of the discussions about children living with parents for a longer period, having to save up for that first home. A lot of them are not home buyers until the age of 40 … because there is just not an opportunity …It's a shocking statistic and it's denying so many of our children and the next generation, the opportunity to also build wealth.”

For example, she cited a housing development that has been delayed for twenty-six years: “I often cite, when we're talking about housing, one of our members who has a 19,000-unit home proposal in Southern California, right on the border of Los Angeles County and Kern County, my hometown, 19,000 units that they have been trying to get approved since 2000.”

Infrastructure Projects

Barrera said the Chamber felt that it was important to go beyond housing and focus BACA on streamlining infrastructure initiatives.

The Chamber has cited the Oakland-based Blue Sky Consulting Group report that found that even a 5% increase in annual statewide spending on essential projects, as defined in the Building an Affordable California Act, could generate $12 billion a year in additional economic output and more than 38,000 new jobs in construction and other sectors.

The resulting wages, profits, and taxable sales would, in turn, add some $220 million a year to California’s general fund and $89 million in annual revenue for local governments. The Blue Sky report notes that increased productivity in the construction sector will “allow firms to produce more output given the same inputs” — in essence, more bang for the buck. Costs will also go down, the report’s authors conclude, when a project’s backers are no longer saddled with indefinite delays and bureaucracy.

“These delays impose costs in the form of uncertainty,” they write, “given that investors may require a higher rate of return to compensate for the uncertainty and development costs may increase by more than the rate of inflation during the delay period.”

Government Costs Likely to go Down.

The current open-ended reviews “impose significant time burdens on government staff, who must prepare updated technical analyses, draft revised impact studies, and coordinate the review process across several public departments,” the report notes. It also points out that local and state governments would see cost pressures go down when building their own public works projects.

So, BACA has a broader infrastructure mandate, Barrera says: “If we want to continue to be the fourth largest economy in the world, what projects do we actually need to streamline to make sure that we're meeting this moment and that we're building out California? So yes, housing is a part of it … but so is … clean energy, because we're obviously going through this transition, it's starting to get quite expensive as we are moving through this energy transition, and how can we really bring down those costs…”

Water is another important infrastructure investment: “We do a poll every single year, and water is the top priority when we are going through a drought. And then when it's not a drought, everybody kind of forgets about it. But we have an aging infrastructure with water as well. We need to do new water sources, recycling plants, and storage facilities.”

Barrera concluded by saying, “We have a beautiful geography here in California, from the coastline to the mountains, the Central Valley … where I grew up, beautiful ag space. And so, we do need to be sensitive to the environment, but we can do better, and we can protect the environment at the same time (as) building this critical infrastructure that we need here in California to continue to be competitive.”