California’s main environmental protection law is slated for reform in the name of affordable housing.

With the median home price in California now over $500,000, developers and real estate agents say the best remedy is to build more homes fast. But the California Environmental Quality Act, passed in 1970 as a more stringent supplement to the National Environmental Policy Act, requires lengthy reviews of development projects to determine their environmental impacts.

Earlier this year, two state agencies drafted legislation to speed up approval of new housing developments by reducing environmental review and public opportunities to challenge projects. The proposals reflected Gov. Schwarzenegger’s pledge in his January "State of the State" address to eliminate the "regulatory and the legal hurdles that delay construction and increase the costs for new housing."

One of the proposals, drafted by the Business, Transportation and Housing Agency, "looked to us like a long developer’s wish list," says Karen Douglas, legislative director of the Planning and Conservation League, a nonprofit lobbying organization. According to the Los Angeles Times, real estate firms, mortgage lenders and developers gave more than $13.5 million to Schwarzenegger, R, during his 2003 campaign, making those industries the governor’s biggest contributors.

None of the administration’s proposals have made it to the state Assembly. But a bill sponsored by State Sen. Don Perata, D, would expand existing exemptions from full environmental review for infill developments within already-urbanized areas. The size limit would increase from four acres and 100 units to 10 acres and 300 units, says Tom Martinez, Perata’s spokesman.

Douglas says Perata’s bill is better than the state proposals; such limited exemptions, which encourage development without threatening farmland and open space, could be part of "a serious effort to fashion good growth." But, she says, the environmental law is still vulnerable to more significant changes: "The governor has a lot of power."