For decades, California has struggled with how to marry its environmental values with its transportation needs while honoring the traditions of local control and building adequate housing.

Until now, it's been failure on nearly every front.

Sprawl has been the name of the game, largely because builders find it easier and cheaper to build on the periphery of cities. Home dwellers end up commuting long distances to work, adding to air pollution and congestion, and forcing the state to spend highway dollars trying to clean up the mess.

The sacred cow of the California Environment Quality Act also distorts the picture. In Sacramento and elsewhere, opponents of affordable housing and infill projects have used CEQA to block various in-town developments. No wonder that many builders have chosen to stay on the periphery.

Sen. Darrell Steinberg, D-Sacramento, has now crafted an agreement that tackles these multiple dysfunctions.

Senate Bill 375, the product of two years of work, has received endorsements from an unlikely coalition that includes environmental groups, builders, local government leaders and others.

Some are calling it the state's most significant land-use bill since passage of the California Coastal Act in 1976.

Under the legislation, each metropolitan region would have to adopt a "sustainable community strategy" to encourage compact development, transit and reduction of greenhouse gas emissions.

Similar to Sacramento's Blueprint, each strategy would be the product of multiple local meetings, and regions would have to include these strategies within their regional transportation plans.

The Air Resources Board would then provide each region with targets for reducing emissions, and would determine if each region was on track to meet those targets.

Regions wouldn't be required by law to meet these targets, but they'd have a strong incentive to do so. Those with effective Blueprint-style plans would get a leg up in obtaining some of the $5 billion in transportation funds the state disburses yearly.

Builders in these regions would also get relief from certain CEQA reviews if they built projects consistent with the strategies. In addition, cities would get extra time – eight years instead of five – to update their housing plans that are required by state law. They'd also have to zone land for housing within three years.

SB 375 is complex, and it still must undergo hearings and analysis in the Assembly. From the looks of it, however, incoming Senate leader Steinberg has managed a breakthrough on managing the state's growth that doesn't impinge on local control.

Builders, who have long opposed regional planning but are looking at a future of $5 gasoline, say they like the bill because it limits their risk of litigation. "We get more certainty in the process," said Ray Becker, chairman of the California Building Industry Association.

Many environmentalists are also enthusiastic. Tom Adams, president of the California League of Conservation Voters and a force in drafting this bill, said Steinberg had managed a "trifecta of the impossible" by dealing with challenges of transportation, housing and climate change.

The Assembly will now need to examine the finer details. Barring any surprises, they should send it to the Senate for concurrence, and then on to the governor's desk.