This conversation aired in the October 20, 2026 episode of Crosscurrents.
Gas is expensive, energy costs are high; housing is scarce and pricey. Many people in the Bay Area are feeling the affordability crisis first-hand. So with the midterm elections coming up on November 3rd, it’s no surprise that many campaigns are honing in on the cost of living. One of those is Proposition 45, which promises to drive down the costs of building things in California. Supporters – including the measure’s sponsor, the California Chamber of Commerce – say it would lead to more housing and lower bills. But opponents say it puts business interests ahead of environmental and civic protections.
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Conversation transcript:
Hana Baba: So we've been seeing mailers and emails and commercials about Proposition 45. Some people say it's a wolf in sheep's clothing. Other people say it's going to save us all money. So break this down. What is it all about?
Mary Catherine O’Connor: Proposition 45 would amend a law called the California Environmental Quality Act or CEQA. This is a bedrock California law that dates back to 1970. And it requires government agencies to determine if a project will harm the environment. And if the answer is yes, then developers have to do what's called an environmental impact review and show all the ways that they could mitigate that harm and alternative ways of building the project.
CEQA also gives residents ways to participate by opposing projects. They might also point to laws that might be broken if it was built, and they can sometimes halt the project altogether while they work it out in court.
H: So basically CEQA requires careful review and it allows participation, but then it can also be expensive and drag out timelines, right?
M: Yes. Prop 45 aims to make CEQA review faster and cheaper.
H: And how do supporters say it would do that?
M: So it adds language to that Bedrock law, CEQA, and for certain projects it would shorten that environmental review process and also reduce the scope of what a court could consider in a CEQA lawsuit and the amount of time they have to make those judgments. And there's actually a lot of other stuff. It's a very long and detailed measure, but those are the highlights.
H: In the voter's guide we all got, the basic description is easy to read, but the actual measure is long and it's filled with legalese.
M: The main argument is really just like we're going to make building certain projects faster and therefore cheaper and that'll trickle down to all of us in terms of lower housing and energy costs.
H: So you keep saying certain projects. What does that mean?
M: So there are eight categories of essential projects. They include things that lots of folks are asking for: clean energy, water infrastructure projects, and wildfire mitigation efforts. But my reporting shows that there's three categories within those, housing, transportation and broadband that are the most controversial.
H: But those don’t sound controversial. So what have you been hearing?
M: So let me back up a little bit. In California, we have these big third-rail projects where they're really contentious. And when the measure talks about those kinds of broader categories…so, for instance, under transportation, it makes a specific exclusion for high-speed rail. And then under water infrastructure, it makes an exclusion for the Delta Tunnel project. So those projects can't be fast tracked even though they fall into those categories. But there's no such exemption under broadband for — this is a biggie — data centers.
H: Data centers. You mean the facilities that run AI, right?
M: Exactly. Yes. We're in a nationwide building boom right now for data centers to support AI. And in California, some cities have actually banned the building of new data centers. The reason they've generated a lot of opposition is that they consume a lot of water and energy.
H: So then what does Prop 45 say about data centers?
M: Well, it depends on who you ask. The folks who wrote the measure say the fact that it doesn't explicitly say data centers means they're not covered. Now, I've read Prop 45 a bunch of times and I think the data center question could be interpreted either way.
And the local community groups who oppose it, or statewide, I should say, community groups who oppose it say it would allow for them.
And then I'll also just say, I spoke with legal experts who think that if Prop 45 passes, there will likely be legal challenges to data centers that get proposed under this faster review.
H: So we know the questions around data centers are a big deal, but can you tell me more about the claims that Prop 45 will save taxpayers money?
M: So the idea is faster review, fewer lawsuits should cut expenses at the state and local levels. And proponents also say that more building happens, that means more tax revenue is raised and we will be filling state coffers. Opponents say, "Okay, but if you build projects that harm the environment, there are going to be long-term costs to public health and other types of costs that will be incurred."
Here's what we do know. There will be big administrative costs to implementing this new law: lots of hiring, maybe some new lawyers at the agencies to help do these quicker reviews and more of them. The Legislative Analyst’s Office estimates that all of that spending could add up to tens of millions of dollars each year — as much as $100 million actually — each year in the first years after the proposition passes.
H: So let's talk about who is backing Prop 45. The California Chamber of Commerce sponsored the measure, but who is supporting it?
M: The California Republican Party and some industry groups, those that represent hospitals, some water agencies, and affordable housing developers.
H: And who is opposing the proposition?
M: You won't be surprised to know a lot of environmental groups oppose it, as do some public health groups, nurses associations, also the California Democratic Party. But I noticed that when I dug in a little bit more into the pro and anti-camps, I actually found a few surprises.
H: Oh? Like what?
M: Well, the California Building Industry Association supports the prop, which isn't surprising. But you might think, okay, then labor unions are probably going to be into it because they can get more work. But they actually oppose Prop 45. And some of what they've said in response is that they consider developers to be anti-union, so they don't want more power to be given to developers.
There's also a bit of that sentiment in some rural counties in California where some of those government officials are neutral on the proposition, have expressed concern that it's a giveaway to developers.
And now there's one more thing that was really surprising when I dug into the financials. So Eric and Wendy Schmidt…Eric Schmidt is the former CEO of Google. He and his wife, Wendy, are noted philanthropists and folks who listen to NPR will know their names. They're big backers, or have been. And the pair has given many millions of dollars to Prop 45. He [has given] in support of it and she [has given] in opposition.
H: Wow, that is surprising! So altogether how much has been raised? And what are the chances Prop 45 will pass?
M: Well, the numbers are pretty stark. Supporters have far outspent opponents, about $40 million to about $20 million as of right now. And polling has been a bit mixed. Back in July, there was a poll that found that 73% of likely voters would vote for something like Prop 45. Now that was conducted before the proposition language was out and the information on who was pro and against it and all the costs of it. And so subsequent polling showed that support actually fell to about 49% of likely voters approving it.
H: That’s a big drop.
M: Yes. So it's kind of a hard to know situation at this point. It's worth noting though that this is a citizen-led initiative. So it wasn't debated and revised through a bill in Sacramento. And so if it passes, it will go into effect immediately and then it will only be amendable by a two-thirds legislative vote.
