California voters weighing Proposition 45 on the November ballot are being asked to settle more than a dispute over housing permits — opponents warn the measure could quietly gut a wave of new state and local protections against unchecked data center development, a fight with direct implications for fast-growing Inland Empire communities already grappling with warehouse and tech infrastructure sprawl.
Proposition 45 is billed by its backers as a streamlining measure for critical infrastructure projects such as housing, schools, roads and bridges, speeding up environmental reviews required under the California Environmental Quality Act. Data centers are not explicitly named among the project types the initiative fast-tracks. But several legal scholars and environmental advocates argue that the measure’s broad and technical language creates an opening that data center developers could exploit.
The concern centers on how Prop. 45 treats broadband and telecommunications infrastructure, along with any facilities deemed necessary to support them. Because the measure extends streamlined CEQA review to those categories — and does not specifically exclude data centers, as it does for projects like California’s high-speed rail — critics say the door is open for operators to argue their facilities qualify for expedited treatment.
Julia Stein, a UCLA law professor and deputy director of the school’s Emmett Institute on Climate Change and the Environment, called the measure a “blunt instrument” when it comes to easing environmental review, given how expansively it defines eligible projects.
“What Prop. 45 does is designate an entire category of projects that would be subject to streamlining, and it also says that projects ancillary to those projects — something that might be necessary to build out that exempted project — would get swept into that same streamlining,” Stein said. Telecommunications projects are explicitly streamlined under the initiative, she noted, “and there are arguments to be made that data center development could be considered necessary for those kinds of projects.”
Matt McKerley, an attorney with the law firm Shute, Mihaly & Weinberger, said the initiative’s silence on data centers — contrasted with its explicit carve-outs for other large projects — is unlikely to be read by courts as accidental. “The fact that they excluded some projects but didn’t expressly exclude data centers would probably be interpreted by a court not as an unintentional oversight, but rather as an intent to include data centers in the initiative,” McKerley said.
Opponents also point to language in the measure stating it would supersede conflicting state laws, which they argue could override Senate Bill 887, a recently passed law that made it harder for data center operators to seek expedited environmental review.
Industry representatives dismiss those concerns. The Data Center Coalition, a trade group backing Prop. 45, maintains its members’ facilities fall outside the measure’s scope, which the group says is focused primarily on housing production and traditional infrastructure like roads and bridges.
“The Data Center Coalition has reviewed Proposition 45 and concluded that data centers do not qualify for the streamlining contemplated by Proposition 45, nor are they a covered entity under any part of the measure,” said Khara Boender, the coalition’s western region director of government affairs.
Supporters also cite a recent legal opinion from California’s Office of Legislative Counsel, which provides legal services to lawmakers, concluding that the measure’s statutory definitions do not extend to data centers. Amelia Matier, a spokesperson for the Yes on Prop. 45 campaign, echoed that assessment. “Data centers are not included in Proposition 45,” she said, adding that opponents of the measure are “desperate to distract voters with lies because they can’t justify the costly delays and red tape that raise prices for working families.”
Opposition to the measure includes the California Labor Federation, the Western Center on Law and Poverty, and a coalition of environmental groups that together have spent more than $31 million campaigning against it.
Yet even as industry groups insist data centers are not covered, major technology and utility interests with a stake in California’s artificial intelligence and computing boom have poured substantial money into the Yes on 45 campaign. Supporters have raised more than $40 million, including $3.05 million from utility giant PG&E and $500,000 from Prologis, a major developer of warehouses and data center facilities. Critics say that financial backing speaks louder than the campaign’s public messaging about who stands to benefit if the measure passes.
The fight comes at a pivotal moment for California’s data center buildout. Gov. Gavin Newsom recently signed seven landmark laws aimed at requiring data center operators to disclose their water usage, pay for their own electrical grid upgrades, and undergo environmental review before breaking ground.
But many local governments aren’t waiting on Sacramento. Amid growing anxiety over rising utility rates, strained power grids and water scarcity, at least 26 California cities and counties — a number that includes jurisdictions across the Inland Empire — have proposed or adopted moratoriums, bans or strict limits on new data center construction.
Nina Robertson, a staff attorney with Earthjustice’s California regional office, warned that the ambiguity in Prop. 45’s ballot language would likely trigger immediate legal battles over local permitting authority.
“And who’s going to bear the cost of that litigation?” Robertson asked. “It’s going to be local governments.”
Original source: CalMatters
