So, what did Sen. Darrell Steinberg's last-minute switcheroo mean for CEQA reform? More than you might think.

As you may have heard, during the last week of the Legislative session, Steinberg gave up on his bill to reform the California Environmental Quality Act – SB 731 – in order to focus on a bill providing CEQA breaks for a new arena in Sacramento, SB 743. He also gave up on his redevelopment revival bill, SB 1, even though that bill was just one slam-dunk Assembly floor vote from the governor's desk.

The irony is that after fighting rear-guard actions all summer against both CEQA critics and CEQA defenders on SB 731, Steinberg actually got some significant reform at the last minute in the Sacramento arena bill. By moving quickly at the end of the session – something he prohibited former Sen. Michael Rubio from doing last year -- he also freed himself from the morass that 731 had gotten bogged down in. And since Steinberg reportedly pulled the switcheroo after meeting with Brown, it seems likely Brown will sign the bill.

The two most important changes have to do with (1) parking and visual impacts of infill projects, and (2) the possibility of giving the Brown Administration a run at traffic level-of-service analysis in infill locations. The bill also eliminated a 2009 sunset date for the creation of "infill opportunity zones" under state law.

The first issue  is likely to have an immediate impact on how infill projects are handled under CEQA. SB 743 says that parking and visual impacts shall not be considered significant impacts on infill projects. There's some wiggle room here for local design standards, but this is still a pretty big deal.

Even the intent language is a big deal, because it is clearly designed – maybe for the first time in the history of CEQA – to put traffic in its place at least in infill locations: "It is the intent of the Legislature to balance the need for level of service standards for traffic with the need to build infill housing and mixed use commercial developments within walking distance of mass transit facilities, downtowns, and town centers and to provide greater flexibility to local governments to balance these sometimes competing needs."

The free pass for parking and visual impacts only applies to infill parcels – that is, parcels that are surrounded on three sides by development – in transit priority areas, defined as areas within a half-mile of a major transit stop. A major transit stop in state law typically means any rail stop, or any bus stop with 15-minute headways.

In practical terms, what this means is that parking and visual impacts wodn't trip an environmental impact report on an infill project and therefore the likelihood of prolonged litigation on infill projects is significantly reduced.

The provision of SB 743 dealing with levels of service is potentially far more significant, though it might take a while to play out. The bill requires the Governor's Office of Planning & Research to prepare new significance thresholds for noise and transportation impacts in infill locations. This was undoubtedly part of the conversation with Brown, because OPR is eager to take a run at levels of service.

The ‘90s-era congestion management act basically requires CEQA analysis to take traffic congestion into account. This has led to a situation where the traffic analysis consumes more time and attention than anything else in a CEQA analysis; and it has made approval of infill projects an uphill battle because, obviously, traffic congestion is more likely to be present in an infill location than a greenfield location.

CEQA practitioners around the state are struggling to figure out how to either revise or jettison the level of service standard – often simply giving up and acknowledging that LOS "F" (the worst congestion) is simply inevitable and therefore acceptable. It's well-known that OPR wants to take a run at a new level of service standard – this was one of the many topics of OPR's proposed changes to SB 731 – and this provision will give the office a chance to come up with something.

All this does not mean that the other proposed changes contained – or potentially contained – in SB 731 are dead. This year is the first year of a two-year legislative session, and so Steinberg simply carried 731 over to next year. 

The same is true for SB 1. This bill would revive tax-increment financing on a limited basis with no impact to the state's general fund when a city, a county, and special districts agree on a strategy that conforms with the sustainable communities strategy. Brown vetoed the same bill last year but Steinberg vowed to bring it back – he introduced as SB 1 in order to make a point – and claimed he had a better shot this year at getting Brown to sign it. 

If Steinberg had permitted the last Assembly floor vote to occur, however, SB 1 would have gone to Brown's desk; and if Brown vetoed it, Steinberg would have had to start over again next year. By holding it over, he can move quickly early next year and hope that Brown signs the bill – Steinberg's last year in the Senate before he is termed out.