Dive Brief:
- California Gov. Gavin Newsom has vetoed SB 954, a bill closely watched by the state’s manufacturing sector that would have narrowed the California Environmental Quality Act exemption for advanced manufacturing projects.
- The legislation would have reduced the scope of final-tier advanced manufacturing facilities eligible for the CEQA exemption, created by two other bills Newsom signed in June.
- Industry groups said that SB 954 would have imposed unnecessary new hurdles and compliance costs for advanced manufacturing projects in the state. Newsom agreed, saying the bill would make many such projects “impractical”.
Dive Insight:
The veto comes as California has been trying to balance protecting the environment with implementing CEQA reforms to streamline approvals for new advanced manufacturing facilities and other projects such as housing, broadband and childcare centers.
The CEQA currently requires a lead agency to determine whether a project qualifies for an exemption from the act’s environmental review requirements.
California defines “advanced manufacturing” as “manufacturing processes that improve existing or create entirely new materials, products, and processes through the use of science, engineering, or information technologies, high-precision tools and methods, a high-performance workforce, and innovative business or organizational models” using specified technologies.
The bill provides that the advanced manufacturing exemption only applies if a project met several different criteria, such as using a minimum of 50% zero-emissions backup power generation and enforcing high labor standards. This could have delayed advanced manufacturing projects or prompted companies to scale them back or move them out of state, the California Manufacturing & Technology Association said in April.
“With this veto, Gov. Newsom backed ‘Made in California’ with the action that matters most – he protected the ability of manufacturers to innovate and create here in California,” CMTA said in a Sept. 18 statement. "Rejecting SB 954 maintains the promise the state made last year when it streamlined CEQA review for advanced manufacturing projects and told companies to build here. That certainty is what turns planned investments into real facilities, real payrolls and real tax revenue for communities across the state.”
SB 954 would have replace the existing CEQA exemption for advanced manufacturing facilities with “a substantially narrower exemption limited to final-tier manufacturing facilities that meet numerous new siting, emissions, operational, technological, and procedural requirements,” Newsom said in his Sept. 18 veto statement to the California State Senate.
Noting two bills enacted last year — AB 130 and SB 131 — to overhaul the state’s housing and environmental review law and “get California building again,” Newsom said SB 954 had the effect of repealing the CEQA exemption for advanced manufacturing facilities.
“Further, the bill’s numerous new siting, operational, and emissions requirements would make the narrower exemption impractical for many of the projects it was intended to support,” he said.
State Sen. Catherine S. Blakespear, who introduced SB 954, expressed disappointment in the veto.
“While some CEQA exemptions enacted last year are important to stimulate housing, economic development and encourage advanced manufacturing, California must provide basic protections for the environment and vulnerable communities – specifically with the inherent dangers that come with advanced manufacturing facilities,” she said in a statement. “We should not have to wait for another emergency before recognizing that sweeping – and rushed – exemptions from environmental review need reasonable guardrails.”
