On June 30, 2026, California’s Governor’s Office of Land Use and Climate Innovation released final guidance for the Assembly Bill 130 Statewide Vehicle Miles Traveled Mitigation Program.
The final guidance largely preserves the draft framework that allows lead agencies to mitigate significant VMT impacts under the California Environmental Quality Act, known as CEQA.
A key development in the final guidance is that initial Program access will be limited to publicly funded projects, which has direct implications for private developers.
Under the Program’s core framework, lead agencies may mitigate VMT impacts through a monetary contribution deposited into the Transit-Oriented Development Implementation Fund.
The California Department of Housing and Community Development would then award those funds to support VMT-efficient affordable housing and related infrastructure projects designed to reduce vehicle travel.
While the Program remains potentially available to any CEQA project with significant VMT impacts, HCD will initially focus access on projects receiving public funding support, including grants, subsidies, loans, and tax credits.
HCD and LCI may revisit this approach through future guidance updates, meaning private developers should monitor early Program use closely.
The Program uses VMT Mitigation Credits to calculate the monetary contribution required to offset a project’s significant VMT impacts, with LCI updating credit values to include an additional three percent administrative cost.
The final guidance also implemented sub-area pricing for the Southern California Association of Governments and Metropolitan Transportation Commission regions, which are larger and more diverse than other metropolitan planning organisations.
The Program’s mitigation theory holds that VMT-efficient affordable housing generates fewer vehicle miles traveled than comparable market-rate housing, with those reductions used to offset impacts from other projects.
The final guidance provides additional detail on how reductions are calculated, including regional data on trip generation, trip lengths, VMT generation per unit, and affordable housing development costs.
LCI has stated it will continue coordinating with HCD on implementation details and begin formal rulemaking to adopt the guidance as CEQA regulations.
Assembly Bill 130 requires LCI to update its implementation guidance at least once every three years after July 1, 2026, ensuring the Program remains responsive to changing conditions.
HCD has also issued Transit-Oriented Development Implementation Program Guidelines addressing how funds will be awarded to eligible affordable housing developments and related infrastructure projects.