California Governor Gavin Newsom vetoed legislation on Friday that sought to limit exemptions under the California Environmental Quality Act (CEQA) for advanced manufacturing facilities, responding to concerns from business groups about potential impacts on industrial growth.
Senate Bill 954, introduced by state Senator Catherine Blakespear (D-Encinitas), aimed to roll back parts of last year’s CEQA overhaul, which expedited approval processes for various housing and infrastructure projects. Critics of the reform argued it allowed certain advanced manufacturing operations—including strip mining, chemical production, battery recycling, and semiconductor plants—to be established without undergoing environmental review.
The legislation had garnered support from numerous environmental organizations, including the Sierra Club, the Natural Resources Defense Council, and California Environmental Voters. Proponents contended that the bill would provide essential protections for communities disproportionately affected by industrial pollution.
In his veto message, Newsom acknowledged the intent behind SB 954 but emphasized that last year’s CEQA reforms were necessary to accelerate construction efforts across the state. He stated that the bill did not simply refine the existing exemption but effectively eliminated CEQA’s exemption for advanced manufacturing. Newsom expressed concerns that the bill’s extensive new requirements related to facility siting, operational practices, and emissions would undermine the practical implementation of the exemption, hindering projects the reforms intended to facilitate.
Blakespear expressed disappointment with Newsom’s decision, citing a recent near-catastrophic chemical incident in Garden Grove that triggered thousands of evacuations as an example of the risks posed by unrestricted siting of industrial facilities in residential areas. She argued that reasonable safeguards do not impede economic growth but rather constitute responsible development to protect communities and workers.
The veto was supported by several business and industry groups, including the California Chamber of Commerce and the California Manufacturers & Technology Association (CMTA). The California Department of Finance also opposed SB 954, describing it as inconsistent with the administration’s policy priorities. CMTA CEO Lance Hastings praised the governor’s decision, highlighting manufacturing’s significant economic contribution to the state, with $382 billion in annual output and 1.24 million jobs supported.
Environmental advocates criticized the veto, warning that the lack of strengthened environmental reviews would leave vulnerable communities exposed to industrial hazards. Asha Sharma, deputy director of Sierra Club California, remarked that the bill was developed to prevent continued environmental injustice in communities harmed by pollution.
Senator Blakespear indicated she plans to continue pursuing legislative solutions on this issue in the coming year.