The Perfect Storm Educational Series

BIASC
Perfect Storm 2.0
Educational Series

STORMY CONDITIONS

The regulatory Perfect Storm that has rocked homebuilding in Southern California for decades is only getting stronger. Just as one storm front is neutralized, two more appear on the horizon. The threat remains so serious that, if this storm hits at full strength, it could undermine the very foundation of homebuilding in Southern California.

Six converging storm fronts now threaten builder profitability. In the worst-case scenario, national builders may be forced to leave California for less regulated markets, while local builders could be pushed to scale back operations or close entirely.

BIA exists for challenges like this. For more than a century, our advocacy efforts at all levels of government have helped protect the industry by pushing back against the most damaging policies. However, the challenges we face today are among the most significant we have ever encountered. That is why BIASC has developed the Perfect Storm 2.0 Educational Series—to equip Builder Members, Associate Members, and their employees with the knowledge and motivation needed to speak out, act together, and secure real solutions.

The Perfect Storm 2.0 Educational Series is designed to help builders, associates, and their teams understand the legislative and regulatory threats facing the industry today, how those threats could impact business operations and staff, and how to become effective advocates in support of homebuilding.

Perfect Storm 2.0 – Advocacy Key Issues

• Vehicle Miles Traveled – VMT standards are poised to severely impact housing construction in California. The State has codified a greenhouse gas reduction framework that lacks a reasonable or practical foundation. Early estimates indicate that the VMT framework could add hundreds of thousands of dollars in new mitigation costs per housing unit, causing many projects to become infeasible and significantly slowing growth statewide. Litigation may be necessary. These provisions are among several introduced under AB 130 that will challenge the industry despite their stated intent to help.

• California Environmental Quality Act (CEQA) – For years, CEQA reform has been a stated priority in Sacramento. Unfortunately, many “streamlining” efforts have resulted in additional requirements that make projects impossible to pencil. While 2025 brought some limited progress, 2026 is expected to introduce a major reform proposal from the California Chamber of Commerce aimed at addressing the core problems of CEQA. This effort will face significant opposition and attempted legislative undermining. Strong vigilance will be required if meaningful reform is to be achieved.

• Insurance Crisis – California’s insurance crisis continues unabated. Although public attention has shifted to other issues, the fundamental problems in the insurance market remain unresolved. Without significant reform, new communities may be unable to secure insurance coverage, making new construction an unacceptable liability. At a time of severe housing shortages, this issue remains a major obstacle to growth.

• Rebuild LA – More than a year has passed since the devastating fires in Pacific Palisades and Altadena. Despite political promises and public attention, meaningful restoration remains far from complete and timelines continue to slip. The homebuilding community must continue working with affected neighborhoods, local governments, the State of California, and the federal government to ensure recovery efforts are accelerated in 2026.

• Climate Action Plans (CAPs) – Jurisdictions across Southern California are expected to continue exploring Climate Action and Adaptation Plans in 2026. While these plans often appear reasonable on their face, their implementation frequently mirrors past housing-unfriendly regional efforts such as Connect SoCal and the SoCal Greenprint. These policies have increasingly been used by environmental and NIMBY interests to block development. A notable example in 2025 was a City of Irvine proposal estimated to impose up to $4 billion in new costs on builders and residents.
  

• Development Impact Fees (DIFs) – Municipal budgets throughout Southern California are under increasing strain, leading some jurisdictions to pursue substantial increases in development impact fees as a revenue source. California already has some of the highest DIFs in the nation, and further increases would significantly hinder the production of attainable housing. BIASC has a strong record of limiting harmful fee increases, but 2026 is shaping up to be one of the most challenging years yet.