California Housing Bill Signed by Governor Newsom

Eight years ago, Governor Gavin Newsom made a promise during his campaign to support the construction of 3.5 million new homes in California by the end of this year. While the actual number may differ, his recent actions seem to back that commitment.

Newsom has signed Senate Bill 79, which will take effect on Friday. This significant legislation seeks to enhance the density around transportation hubs across California and stands as one of the most ambitious housing initiatives from the state in recent times.

“Every Californian deserves access to affordable housing close to employment, schools, and other opportunities,” Newsom stated. “Building homes near transit leads to shorter commutes, reduced expenses, and more quality time with families. Investing in housing is essentially investing in people who aspire to create a future and contribute to their communities.”

The comprehensive bill, effective from July 1, 2026, will allow local zoning laws to be overridden, promoting taller and denser developments near transit hubs like subway and light rail stations, as well as dedicated bus lanes.

Developers will be permitted to erect residential buildings up to nine stories adjacent to subway stations, seven stories within a quarter-mile, and six stories within a half-mile. The legislation also makes allowances for five- to eight-story residential structures near light rail and bus routes, depending on proximity to key stops.

This marks the second major housing reform Newsom has enacted this year, complementing a previous bill aimed at expediting home construction by dismantling some of the regulatory challenges posed by the California Environmental Quality Act (CEQA).

Newsom’s decision concludes a wave of discussions and petitions from various stakeholders, including residents and advocacy groups, urging him to either approve or reject the bill.

Many view this as a significant win for YIMBY (Yes In My Backyard) organizations and developers who assert that the best solution to California’s housing crisis is to facilitate building near transit, helping satisfy the demand for public transit and curbing vehicle emissions.

“Signing SB 79 cements Governor Newsom’s reputation as a pioneering force in California housing policy,” commented Brian Hanlon, CEO of California YIMBY. “Our next step is ensuring the fair implementation of its provisions.”

However, the bill has drawn criticism from cities such as Los Angeles, which argue that this approach lacks consideration for local needs. Mayor Karen Bass has called for Newsom to veto the legislation, and the Los Angeles City Council has passed motions against it.

This has sparked a complex debate among cities, developers, and residents regarding the bill’s impact and the potential for exemptions.

Senator Scott Wiener (D-San Francisco) introduced the bill in January, emphasizing urgent action to tackle the state’s housing dilemma. Nevertheless, as the bill navigated through legislative processes, numerous amendments were introduced to secure the necessary votes.

The final version ended up being somewhat convoluted. Some stakeholders have expressed confusion about its provisions. For instance, the bill’s focus has narrowed to counties having a minimum of 15 passenger rail stations, leaving only eight counties remaining under its jurisdiction: Los Angeles, Orange, San Diego, Alameda, San Francisco, San Mateo, Santa Clara, and Sacramento.

Reports suggest that the most significant effects of this legislation will likely be experienced in Los Angeles, where around 150 transit stops would fall under the bill’s provisions.

Transportation and Housing Dynamics

According to preliminary analyses, Senate Bill 79 will alter local zoning regulations to permit constructions of five to nine stories in neighborhoods surrounding numerous public transit stations in Los Angeles. However, certain properties may still qualify for exemptions or multi-year deferrals.

Lawmakers included various deferral options to allow cities to postpone implementation in selected zones until approximately 2030. This will give the government an additional year to propose updated plans for boosting new housing developments and managing growth.

For a span of five years, cities can opt to exempt properties situated in high-fire risk zones, historical preservation areas, and low-resource regions, attempting to minimize the bill’s adverse impact on gentrification in vulnerable communities.

Challenges and Complications

In an effort to secure more votes, amendments known as the “Beverly Hills carve-out” were introduced. This creates disparities in zoning requirements for specific affluent cities like Beverly Hills and South Pasadena, confusing the entitlement map further.

For example, while the law may apply to only a quarter-mile radius around a transit stop in South Pasadena, it covers a half-mile radius in neighboring cities like Pasadena and Highland Park in Los Angeles. It’s noted that these differing regulations could generate inconsistencies in housing availability.

Prior to Newsom’s endorsement, council member Katie Yaroslavsky from Los Angeles commented on this disparity, highlighting that “Beverly Hills will get a pass, while Los Angeles needs to deal with the issues.”

The dynamics surrounding this bill are undeniably complicated. For instance, a city could exempt properties from certain requirements if they are over half a mile from a transit station, even if physical barriers create substantial distances on foot.

Though various online resources attempted to illustrate the potential areas for upzoning under SB 79, none managed to provide precise parcel details. Recently, Los Angeles planners released a draft map, warning that this should only be seen as a research tool rather than a definitive guide, as an official eligibility map will be issued later by the Southern California Association of Governments.

Cities, developers, and homeowners will only find clarity when this updated map is available. Meanwhile, YIMBY groups are hopeful that the bill could encourage multifamily development in Los Angeles—a trend that has diminished in recent years due to challenging economic conditions and regulatory uncertainties.

“California is changing whether people want to accept it or not,” commented Matt Lewis, a spokesperson for California YIMBY, a primary supporter of the bill. “The real question is whether these changes will lead to sustainable and affordable outcomes or become chaotic and expensive.”