California’s new housing laws, and where Ro Khanna stands

AB 130: no CEQA review for infill housing

For decades the California Environmental Quality Act was the tool of choice for stopping an apartment building that met every zoning rule. AB 130, a budget trailer bill Governor Gavin Newsom signed on June 30, 2025 as Chapter 22, Statutes of 2025, ended that for most urban housing. Under Public Resources Code section 21080.66, CEQA does not apply to “any aspect of a housing development project” that meets these conditions:

• 20 acres or less, inside a city or a Census urban area.
• Infill. The site was previously developed with an urban use, or at least 75% of its perimeter adjoins urban uses, or 75% of the land within a quarter mile is urban.
• Consistent with the general plan and zoning, judged by whether a reasonable person could conclude it is. A state density bonus does not make it inconsistent.
• At least half the density the state assumes for lower-income housing sites in that jurisdiction.
• Not on an excluded site such as wetlands, a very high fire hazard zone or farmland, the same list SB 35 uses, and not demolishing a registered historic structure or used as a hotel.

The section itself carries no affordability or labor requirement; its trade is conformity with the rules a city has already written. Its companion, SB 131 (Chapter 24), narrows CEQA review for a project that misses an exemption on a single condition to that one condition, according to the Association of Bay Area Governments.

SB 79: apartments near transit

SB 79, Senator Scott Wiener’s Chapter 512, Statutes of 2025, makes a housing project of five or more homes an allowed use on any residential, mixed-use or commercial site near a transit-oriented development stop, and forbids the city from zoning it smaller than a state floor. It has applied to cities since July 1, 2026, and reaches only “urban transit counties,” those with more than 15 passenger rail stations. In the Bay Area that means Alameda, San Francisco, San Mateo and Santa Clara, per the Metropolitan Transportation Commission, which reads BART and Caltrain stations as Tier 1 and VTA light rail as Tier 2. In Downtown San Jose, that puts Diridon Station’s Caltrain platforms in Tier 1 and the downtown light rail stops in Tier 2.

Tier 1 stops are served by heavy rail or commuter rail with at least 72 trains a day; Tier 2 covers light rail, less frequent commuter rail and qualifying bus rapid transit. The half-mile ring applies only in cities of 35,000 people or more. A project immediately adjacent to a stop gets 20 more feet, 40 more homes per acre and 1 more point of floor area ratio, before any state density bonus, which SB 79 projects may also use.

In exchange, projects of more than 10 homes set aside 7% for extremely low income, 10% for very low income or 13% for lower income households, for 55 years on rentals and 45 on ownership homes, or the local inclusionary share if it is higher. Buildings over 85 feet take on SB 35’s labor standards. A project may not demolish rent-controlled housing that tenants occupied in the past seven years. From January 1, 2027, a city that denies a qualifying project in a high-resource area is presumed to have violated the Housing Accountability Act and is immediately liable for its penalties.

AB 507: office-to-housing conversions

The third piece, AB 507 by Assemblymember Matt Haney, took effect the same day as SB 79. It makes converting an existing building, office or otherwise, into housing a use by right in nearly every zone, CEQA-exempt, with a ruling on consistency in 60 or 90 days, in exchange for 13% to 15% affordable rentals and prevailing wages. This site covers it section by section in the Office to Housing Conversion Act, explained.

The three laws fit together. AB 130 removes CEQA for housing the zoning already allows; SB 79 changes what the zoning allows near transit; AB 507 opens zones that never allowed housing at all, provided the building is already there.

What is on the governor’s desk

The Legislature sent these housing bills to Governor Newsom before it adjourned. Under the state constitution he has until September 30, 2026 to sign or veto them; a bill he does neither to becomes law. Status is from each bill’s legislative history as of September 28, 2026, and the list follows California YIMBY’s end-of-session summary.

Where Ro Khanna stands

Congress does not zone land. Khanna's housing work has gone where federal law does reach: money, tax, mortgages and ownership.

Ro Khanna has represented California’s 17th District since 2017. Its cities, as his office lists them, are Cupertino, Fremont, Milpitas, Newark, San Jose, Santa Clara and Sunnyvale, in Santa Clara and Alameda counties, both of which SB 79 covers and which are served by BART, Caltrain and VTA light rail. His House website says housing “should be a right, not a speculative commodity.”

On zoning, he has called himself a YIMBY. In March 2025, agreeing with the columnist Ezra Klein, he wrote: “We need to build more housing in my district and in California and get rid of overly restrictive zoning —the original sin of California’s housing crisis. It has artificially inflated prices, attracting institutional investors & driving up rents. YIMBY.” State law is outside his vote, and as of September 28, 2026 we found no statement from him on SB 79 or AB 130 in particular.

On ownership, he has pressed the same bill since at least 2024, and it is the center of his housing agenda.

The Stop Wall Street Landlords Act

On January 20, 2026 Khanna reintroduced the Stop Wall Street Landlords Act with Representatives Summer Lee, Mark Takano and Jill Tokuda. It would:

• deny large institutional investors the mortgage interest, insurance and depreciation deductions on single-family homes;
• bar Fannie Mae, Freddie Mac and Ginnie Mae from buying those investors’ single-family mortgages;
• impose a 100% federal transfer tax on single-family homes they still hold 18 months after enactment; and
• send the revenue to the national Housing Trust Fund, exempting small landlords, nonprofits and affordable housing programs.

“Homes should be owned by people, not wealthy corporate landlords who are buying up single-family homes and pushing the dream of homeownership out of reach for too many Americans,” he said. “If President Trump is serious about taking on Wall Street landlords, Congress should pass my bill and he should sign it into law.” As of September 2026 the bill had not become law, but a narrower version of its idea had.

Ro Khanna’s votes on the ROAD to Housing Act

The 21st Century ROAD to Housing Act passed each chamber more than once before it became law on July 11, 2026. Khanna voted yes on each of the three House votes to pass it:

The fight he joined was over Title X, Section 1001, “Homes Are for People, Not Corporations.” The Senate version passed in March required large investors to sell certain homes they were still allowed to buy, including build-to-rent homes, within seven years. The House’s May version dropped that. On May 16, four days before the House vote, Khanna wrote that the Senate bill “finally cracks down on private equity buying up single family homes” and that “the House should pass the Senate bill instead of weakening it with loopholes & stripping out the requirement for institutional investors to sell homes back to” families. He then voted for the House version, and for the final text.

The enacted section kept the House’s approach. From January 7, 2027, an entity controlling 350 or more single-family homes may not buy another, unless the purchase is an excepted one: homes it builds or renovates to sell, build-to-rent and substantial renovate-to-rent homes, rent-to-own programs, foreclosures, and purchases from other covered investors, among others. It “shall not be construed to require any large institutional investor to divest or otherwise sell any single-family home purchased before the date of enactment.” Penalties run to $1 million per violation or three times the price, whichever is greater, and the ban expires after 15 years.

Questions

Sources

1. California Legislature, “SB-79 Housing development: transit-oriented development (chaptered text)”
2. Metropolitan Transportation Commission, “SB 79 summary, April 8, 2026”
3. California Legislature, “Public Resources Code section 21080.66”
4. California Legislature, “AB-130 status”
5. California Legislature, “SB-131 status”
6. Association of Bay Area Governments, “Assembly Bill (AB) 130 and Senate Bill (SB) 131”
7. California YIMBY, “The Homework: September 1, 2026”
8. Office of Rep. Ro Khanna, “Housing”
9. Office of Rep. Ro Khanna, “Our District”
10. Office of Rep. Summer Lee, “Reps. Lee, Khanna, Takano, and Tokuda reintroduce the Stop Wall Street Landlords Act”
11. Ro Khanna on X, “March 19, 2025”
12. Ro Khanna on X, “May 16, 2026”
13. Clerk of the House, “Roll call 57, February 9, 2026”
14. Clerk of the House, “Roll call 176, May 20, 2026”
15. Clerk of the House, “Roll call 224, June 23, 2026”
16. U.S. Government Publishing Office, “Public Law 119-101, Section 1001”

More California law: Office to Housing Conversion Act (AB 507)

Federal law: The ROAD to Housing Act explained · Environmental review changes · CDBG and HOME changes · Opportunity Zones · The Innovation Fund · The Build Now Act · Manufactured housing and the chassis rule · How RESIDE grants should be sized