Newsom Expected to Veto California Manufacturing Bill
Governor Newsom reportedly plans to reject legislation targeting environmental exemptions for industrial sites.
Updated on Sept. 19, 2026 in Legislative Policy
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Governor Gavin Newsom is expected to veto Senate Bill 954, legislation that would eliminate a California Environmental Quality Act exemption for advanced manufacturing facilities. The decision follows intense lobbying from both environmental groups and industrial associations.
Why it matters
The bill aims to provide greater environmental oversight for new industrial projects, while opponents argue it risks discouraging high-paying manufacturing investment in California. The conflict highlights a tension between state environmental standards and the desire to remain competitive for advanced technology facilities.
Senate Bill 954 passed with support from 78 Democrats, while Republicans voted against the measure. The bill seeks to remove CEQA exemptions previously utilized for projects like a Google quantum computing facility in Goleta and an industrial park in Lakewood.
The players
Gavin Newsom
He is the Governor of California and holds the final authority to sign or veto bills passed by the state legislature.
Catherine Blakespear
She is a member of the California State Senate who amended the bill to address concerns from affordable housing advocacy groups.
California Manufacturers and Technology Association
This trade association represents the interests of manufacturing and technology firms operating within the state of California.
This major technology corporation is noted in the legislation for utilizing a CEQA exemption for its quantum computing facility in Goleta.
Department of Finance
This state agency provides fiscal analysis and policy recommendations to the governor regarding pending legislation.
The details
Senate Bill 954 targets exemptions that allowed facilities such as a proposed nuclear fusion testing site in Livermore to bypass certain reviews, though that project eventually opted for a location in New Mexico. The Department of Finance has formally opposed the bill, aligning with the California Manufacturers and Technology Association, which urged a veto on August 31.
Timeline
In 2025, the legislature passed the initial CEQA exemption bill.
On August 31, 2026, the CMTA urged Governor Newsom to veto the new legislation.
On September 16, 2026, environmental groups signed a letter urging the governor to sign the bill.
September 30, 2026, is the deadline for Governor Newsom to act on the bill.
Political Context
Opponents of the bill, including the California Manufacturers and Technology Association, argue that restricting the California Environmental Quality Act will erode high-paying jobs and hinder industrial investment. Conversely, proponents maintain that the bill is necessary to ensure basic environmental protections for local communities near industrial parks.
For residents in areas like Goleta or Lakewood, the vetoing of this bill means that future large-scale manufacturing projects may continue to proceed with fewer environmental oversight requirements. This decision effectively maintains the existing regulatory landscape for developers and industrial employers across the state.
The takeaway
The potential veto of Senate Bill 954 underscores the ongoing difficulty California faces in balancing strict environmental standards with the economic desire to attract advanced research and manufacturing facilities. Residents should track future legislative attempts to amend state environmental laws as the debate over industrial growth continues.
Further reading
For more on how state regulations are evolving, visit the Legislative Policy section.
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