The United Voice for Affordable Housing

INDUSTRY INSIGHT MAY 2023

NOTE FROM THE EXECUTIVE DIRECTOR

"Legislators clearly care about affordable housing and want to find new ways to fund it"

Normally this is a time of year when the state’s budget picture is coming into focus, with tax season behind us and the Governor’s revised May budget only a week away. This year has been different, though, as winter storms caused tax filing dates to be pushed back for most Californians—leaving the state’s tax revenue situation uncertain.

To me, two things are clear. One, the state will be facing a multi-billion dollar deficit this year, likely higher than the $22.5 billion projected by the Administration in January. Two, that doesn’t mean state leaders can shrug their shoulders and dial back their efforts to invest in the affordable housing Californians need.

One positive sign on this front in the last few weeks came from Senate Democrats, who unveiled an ambitious budget proposal filled with creative ideas for funding high-priority programs. This includes a new $10 billion “Housing and Infrastructure Fund” that would support a range of key investments, including an additional $500 million for the state LIHTC—on top of the $500 million currently allocated to the program. The Senate also included $300 million in flexible funding for HCD to spend on successful initiatives like the California Housing Accelerator.

These are exactly the kinds of actions California should be taking during these uncertain economic times. Doubling the size of the tax credit, in particular, will roughly double the size of the state’s affordable housing pipeline.

The Governor didn’t respond favorably to the Senate’s ideas—mostly due to a disagreement about the proposed funding source (a new tax on corporations). That shouldn’t be a reason to ignore the rest of these ideas. Legislators clearly care about affordable housing and want to find new ways to fund it. If it’s in this year’s budget, great. If we have to do it through a combination of budget funding and a new housing bond—like AB 1657 (Wicks)—that’s fine too.

The important thing, at a time when the economic picture remains cloudy, is to keep building the affordable housing Californians need.

That remains our goal. It’s good to see we have no shortage of allies in the Legislature fighting for the same thing. You can be sure we’ll be reminding the Administration of this over these next few critical weeks of budget season.

Sincerely,

Ray Pearl, Executive Director

IN CASE YOU MISSED IT

All of CHC’s sponsored bills are advancing out of policy committees. AB 1449 (Alvarez) is headed to the Assembly Committee on Appropriations. AB 1307 (Wicks) was placed on the Consent Calendar and is headed to the Assembly floor. Both SB 440 (Skinner) and SB 423 (Wiener) are headed to the Senate Committee on Appropriations. SB 439 (Skinner) was placed on the Consent Calendar and is headed to the Senate floor.

CHC submitted comments to TCAC on their proposed regulation changes. To view the letter click here.

CHC submitted comments on HCD’s proposed changes to the Round 2 Multifamily Super NOFA program guidelines. To view the letter click here.

LEGISLATIVE ROUNDUP

To help every community stay on track to achieving their housing goals, CHC is sponsoring a package of legislation this year that will further accelerate local approvals, remove lingering barriers to affordable development, and help lower-income Californians access the safe, affordable homes they need.

SB 423 (Wiener): SB 35 Sunset Extension

This bill will extend and strengthen SB 35’s streamlining provisions and remove the sunset on SB 35 (Wiener).

SB 439 (Skinner): Special Motion to Strike NIMBY Lawsuits

This bill will strengthen existing protections for affordable housing projects by providing additional remedies to curtail non-meritorious litigation that can delay or kill projects even after they secure local approval.

SB 440 (Skinner): Regional Housing Finance Authorities

This bill will empower local governments to join forces to create regional housing finance agencies to address the unique affordable housing needs in their communities.

AB 1307 (Wicks): CEQA Noise Impact in Residential Projects

This bill will reverse a troubling, recent court decision relating to unamplified human noise under the California Environmental Quality Act (CEQA).

AB 1449 (Alvarez): CEQA Exemption for Affordable Housing

This bill will facilitate the development of affordable housing by exempting from CEQA certain 100% affordable housing projects throughout California.

Please take action today by placing your letterhead on each of CHC's sample support letters and uploading them onto the Legislative Position Letter Portal, and sending copies to our Policy Associate, Jennifer Armenta, at jarmenta@calhsng.org.

CHC is supporting other priority housing bills, view our bill tracker to see real time updates.

View our Bill Tracker

SAVE THE DATE!

CHC's 2023 Policy Forum &

CA Housing Hall of Fame Awards

September 7, 2023

Anaheim, CA

Thanks to our Title Sponsor Sponsor, Merritt Community Capital!

Contact Nancy Martin for sponsorship opportunities.

AFFORDABLE HOUSING NEWS OF THE MONTH

Cracks in California labor coalition raise hopes for YIMBY breakthrough on housing bill (CalMatters)

State Supreme Court rejects Save Livermore Downtown petition to review Eden Housing case (Livermore Vine)

California AG Rob Bonta sues Elk Grove for breaking housing law: ‘They have left us no choice’ (Sacramento Bee)

EDITORIAL: If California cities want homeless funding, they better stop blocking housing (Los Angeles Times)

EDITORIAL: If PG&E can’t turn the lights on for new housing, California needs to step in (San Francisco Chronicle)

FEDERAL UPDATE FROM DAVID GASSON

Happy May. Spring has sprung, baseball season is in full swing (as a Red Sox fan I thank you LA Dodger fans for Justin Turner) and in Washington we are getting excited about the introduction of the new version of the Affordable Housing Credit Improvement Act. For those of you attending the HAG/AHTCC Housing Forum on May 17^th, it is possible the introduction will be announced at the meeting.

There may be some new provisions in the AHCIA, but I will get to that in a moment. First, let’s discuss the issue of most urgency in DC, the debt ceiling. As of this posting, Treasury Secretary Yellen has informed Congress that the extraordinary measures Treasury has been exercising to pay the debt may expire as soon as June 1^st, a month earlier than previously expected. President Biden has requested a meeting of the House and Senate leadership and it appears that meeting may take place on May 9^th.

The House Republican’s recently passed the Limit, Save, Grow Act of 2023, a bill designed to reduce discretionary spending, claw back COVID relief money and defund the IRS and large parts of the Inflation Reduction Act. It passed the House by two votes with five Republican’s voting against the bill.

The bill would set the FY 2024 Budget at FY 2022 levels and limit future increases to 1% thereafter, lower than the rate of inflation. IF enacted, it would slash the HUD budget by around $6.5 billion alone and cripple the voucher programs while eliminating most other spending. Needless to say, this is a non-starter for the administration and Senate Democrats and with the accelerated timeline laid out by Secretary Yellen, it would be very difficult to bring any legislative package that significant to the floor of the Senate and back to the House before June 1. (Ironically, the extension on federal tax filing granted residents of the California may be what moved up the date on the debt ceiling.)

CHC MEMBER SPOTLIGHT

In 2017, Senator Wiener’s SB 35 was signed into law to boost the production of affordable and mixed-income housing by streamlining housing approvals in cities that were not keeping pace with their state-mandated housing goals. This CHC supported bill has been enormously successful at increasing affordable housing production—helping develop over 13,000 units of affordable housing in the four years since it went into effect.

This is why CHC is co-sponsoring SB 423 (Wiener), which will extend SB 35 provisions beyond 2025—and strengthen the law, so it can continue to accelerate the development of affordable housing every community needs.

Featured below are examples of CHC-member developments that have benefited from SB 35: