NY Legislature enacts reforms to New York State Quality Review Act (SEQRA)- by Richard Leland

In legislation signed into law by governor Kathy Hochul on May 26, 2026, the Legislature enacted significant reforms of the 50-year-old New York State Environmental Quality Review Act (SEQRA). The principal purpose of these reforms is to encourage housing development by shortening the approval process. They do so by exempting applications for certain housing developments, up to a specified number of units, adding time frames for agency reviews of applications subject to SEQRA; and clarifying the statute of limitations for proceedings challenging SEQRA compliance. This article summarizes the changes and identifies several issues the legislation raises.

BACKGROUND
SEQRA, codified in Sections 8-0101et seq. of New York’s Environmental Conservation Law (ECL), was enacted in 1976 to incorporate environmental analysis into actions “undertaken, approved, or funded by state agencies.” SEQRA authorizes agencies, including municipal agencies, to promulgate regulations interpreting the statute. Further, SEQRA requires the New York State Department of Environmental Conservation (DEC) to promulgate regulations that set the floor for implementation.

The statute and regulations set forth a several-step process for incorporating that analysis into what the statute defines as “actions.” The process begins with the designation of a “lead agency,” responsible for coordinating environmental review, which classifies an action requiring discretionary approval as “Type I,” “Type II,” or “Unlisted.” Under DEC and other agencies’ regulations, Type II actions are excluded from SEQRA review because they are presumed by their nature not to have significant impacts on the environment; Type I and Unlisted actions require further review. The lead agency then requires the applicant to prepare an Environmental Assessment Form (EAF), which helps the lead agency determine whether the project will have a significant environmental impact. That decision is made through the adoption of either a “Negative Declaration”—that the project will not have a significant impact—or a “Positive Declaration”—that the project may have a significant impact and therefore requires the preparation and public review of an Environmental Impact Statement (EIS). The time between the establishment of a lead agency and the adoption of a Positive or Negative Declaration can take years, stalling a project in its tracks.

For projects that receive a Positive Declaration, a Draft EIS (DEIS) analyzes and discloses environmental impacts and proposes mitigation (or states that impacts cannot be mitigated) across categories such as air quality, hazardous materials, traffic, noise, and socioeconomics. Public scoping often guides the categories studied by allowing the public to identify areas of concern that the DEIS should address. The DEIS is subject to public review and comment, typically including a public hearing. Before a final decision on the project may be made, the lead agency must adopt a final EIS, incorporating responses to comments from the public and other agencies, along with written findings.

Experience has shown that the SEQRA process for non-exempt projects can be expensive and time-consuming. Critics have long argued that it unduly delays the planning and construction of housing, infrastructure, and other projects.

THE SEQRA REFORMS
The legislation amends SEQRA in several ways.

Time Frames: ECL Section 8-0109.4 has been amended to require the lead agency to determine whether an EIS is required within one year after the establishment of said lead agency. Subdivision 5 of that section now requires issuance of a final EIS no later than two years after the lead agency determines that an EIS is required. The Subdivision 5 deadline for completion of a final EIS may be extended at the request of the responsible lead agency and for specific reasons, such as changes in the project that could create new impacts, or the failure of an applicant to provide necessary information. Neither deadline previously appeared in the statute or in regulations promulgated thereunder.

Exemptions: The most significant changes are amendments to Section 8-0111, which add a new Subdivision 5-a, exempting qualifying projects from any review under SEQRA, thus avoiding the need to establish a lead agency, classify the action, or prepare an EAF, DEIS, or EIS. See Section 8-0111.5-a (a). These exemptions are stronger than regulatory exemptions because no agency, including DEC, would be permitted to weaken them by regulation. The determination as to whether the exemptions apply—including for a variety of land-use approvals—is delegated to the agency responsible for the action, which must determine within 120 days of receiving the application whether it qualifies. See Sections 8-0111.5-a (b), (d). Under Section 8-0111.5-a (d), the responsible agency’s determination as to whether an application is qualified for exemptions must be made within 120 days of its receipt of the application.

Housing: Section 8-0111.5-a (b)(i) exempts qualifying projects involving the construction of housing in cities with populations greater than one million (i.e., New York City). To qualify, they must be connected to existing water and sewage systems, located in a “previously disturbed site,” not be located in an area zoned “exclusively for industrial uses,” and contain no more than 50,000 s/f of commercial, retail, community facilities, or other non-industrial uses. Proposed developments with up to 250 units are exempted, with the threshold increasing to 500 units in certain higher-density zones.

Section 8-0111.5-a (b)(ii) exempts housing projects in cities, towns, and villages with populations under one million. This exemption covers developments up to 100 units and up to 300 units in cities, towns, or villages defined as “urban” in the census. The limit of the exemption is 20 units in cities, towns, or villages that do not have zoning. The other qualifications include those applicable in New York City as well as several others, but the limit of non-residential uses is 20% of gross floor area.

Other Exemptions: The statute includes the following additional exemptions:

• Public Parks: Section 8-0111.5-a (b)(iii) exempts public park construction on previously disturbed sites so long as the parks do not include performance centers, stadiums, venues for mass gatherings, or buildings and structures that do not serve park, recreation, or open space purposes.

• Multi-Use Trails: Section 8-0111.5-a (b)(iv) exempts the construction of shared bicycle and pedestrian trails on previously disturbed sites.

• Public School Facilities: Section 8-0111.5-a (b)(v) exempts public school construction in cities with populations exceeding one million, provided the facilities will be connected to existing public water and sewer systems when they open.

• Water and Wastewater Infrastructure: Section 8-0111.5-a (b)(vi) exempts water and wastewater infrastructure projects involving in-kind replacement or rehabilitation of existing municipal systems on the same site (including lead service line replacement), upgrades to existing small community water systems, or extensions of sewer service to disadvantaged communities currently served by inadequate sewage systems where the department has determined no separate environmental permit is required.

• Green Infrastructure Retrofits: Section 8-0111.5-a (b)(vii) exempts projects that retrofit existing structures and their surrounding areas to add green infrastructure.

• Statute of Limitations: The statute also amends Section 8-0111 by adding Subdivision 7, which specifies when the statute of limitations accrues for challenges to agency determinations under SEQRA or its implementing regulations. The statute of limitations would begin to accrue when an agency determination to approve or disapprove an action becomes final and binding upon the petitioner or the person whom the petitioner represents in law of fact. This clarifies some concerns as to when the statute begins to run in cases where a final SEQRA determination precedes the final determination of the underlying action.

OPEN QUESTIONS AND ISSUES
Agency Implementations: The statute became effective immediately when the governor signed the bill on May 26. The agencies that are and will be responsible for its implementation have not yet had an opportunity to determine how they will decide which projects qualify for the exemptions. Several, including the New York City Department of City Planning, have begun meeting to create a procedure and have created a preliminary questionnaire to determine eligibility. Others will likely follow as the number of requests for determinations of eligibility increases.

Interpretations: As is the case with most statutory definitions, key terms will require interpretation. For example, one of the criteria for eligibility for the exemption is that the housing action cannot be located in an area zoned “exclusively for industrial uses.” There are municipalities in which there are zoning designations identified as “I” or “M” districts, but which allow for some residential uses. One would assume that those districts would fall outside the definition of excluded districts, but the implementing agencies will need to clarify this.

Defining the Project and Insuring Compliance with the Criteria: In some jurisdictions, including New York City, the Zoning Resolution allows for the rezoning of several parcels for which there is not a defined project and for which the proposed zoning designation allows for a variety of uses. The rezoning applicant may only control one parcel and may have no control over development of the others. Unless there is an accompanying application for a specific development on the controlled site, by means of a special permit or other means, a plain rezoning would not necessarily contain a requirement that the development seeking an exemption meets the statutory criteria, unless the rezoning is accompanied by a restrictive declaration or other covenant guaranteeing that the exempted development would meet the applicable criteria. Development of the non-applicant-owned parcels subject to the rezoning could not be limited by such covenants and the question remains as to how it can be assured that development on those parcels would be consistent with the eligibility requirements.

Environmental Analysis Absent SEQRA: Even in the absence of a SEQRA’s procedural requirements, planning boards, planning departments, and village, town, and city officials will still be concerned with the environmental effects of development proposals, as will residents and community groups. SEQRA provides a well-established means of analyzing those concerns and incorporating those analyses into the application process. Applicants can respond to questions about environmental issues by pointing to the analyses that are part of the SEQRA process, and courts generally uphold environmental determinations made as the result of compliance with SEQRA methodologies and processes. Without SEQRA review, questions may instead arise ad hoc, without an established structure for responding to community concerns. This may prove to be an unintended consequence of the statutory reforms.

CONCLUSION
The reforms mark an important shift in SEQRA practice: for qualifying projects, speed and predictability are now express statutory goals, not merely administrative aspirations. But the legislation does not eliminate the environmental, land-use, and community concerns that SEQRA has long provided a framework for addressing. So while SEQRA reform may shorten the road to approvals, its real test will be whether agencies can replace a familiar, if cumbersome, review process with clear and predictable rules for what comes next. The reforms’ effectiveness will depend less on the exemptions themselves and more on how responsible agencies create procedures that are efficient enough to advance housing and infrastructure, while clear enough to withstand public and judicial scrutiny.

Richard Leland is a partner in the real estate practice group at Akerman, LLP, West Palm Beach, FL.