California Housing Update – January 15, 2019

January 15 – California Housing Update

Committee Membership

President Pro Tempore of the Senate, Senator Toni Atkins announced Senate committee memberships on January 7th. Most notably, the Senate Housing and Transportation Committee was split into two separate committees, the Housing Committee and the Transportation Committee. The Housing Committee is now chaired by Senator Scott Weiner – a staunch housing advocate and strong proponent of reducing barriers to building housing in California. While the Transportation Committee is chaired former joint committee chair, Senator Beall. Senator McGuire remains the chair of the Senate Governance and Finance Committee.

The Assembly Housing and Community Development Committee is still chaired by Assemblymember Chiu and Local Governance leadership remains the same with Assemblywoman Aguiar-Curry as chair.

Recently Introduced Legislation

While we have seen legislation introduced in recent weeks relating to Redevelopment 2.0 – the Governor essentially squashed any hope of revitalizing redevelopment, making it clear that he planned to allocate funding outside of redevelopment agencies to address the affordable housing crisis – as seen in his budget address as well as today’s executive order on use of state surplus land. With that in mind however, we have seen a number of bills introduced within the last month to tackle the housing and homelessness crisis.

• AB 10 (Chiu D)   This bill would increase the aggregate housing credit dollar amount that may be allocated among low-income housing projects by an additional $500,000,000, as specified, and would allocate to farmworker housing projects $25,000,000 per year of that amount. T
• AB 14 (Rivas, Luz D)   Multifamily Housing Program: This bill would appropriate an unspecified sum from the General Fund into the Housing Rehabilitation Loan Fund to be expended under the Multifamily Housing Program to fund housing for homeless youths and homeless families in accordance with certain requirements, including that the department prioritize loans to housing projects in disadvantaged communities, as defined, and that unspecified amounts be set aside for both certain homeless youths and certain homeless families.
• AB 22 (Burke D)   Housing: safe and clean shelter for children. This bill would declare that it is the policy of the state that every child has the right to safe and clean shelter and that no child should be without safe and clean shelter by 2025.
• AB 36 (Bloom D)   Affordable housing: rental prices. This bill would state the findings and declarations of the Legislature that, among other things, affordable housing has reached a crisis stage that threatens the quality of life of millions of Californians as well as the state economic outlook. This bill also would express the Legislature’s intent to enact legislation in order to stabilize rental prices and increase the availability of affordable rental housing.
• AB 41 (Gallagher R)   Disaster relief: Camp Fire. This bill would provide that the state share is up to 100% of total state eligible costs connected with the Camp Fire that started on November 8, 2018, in the County of Butte.
• AB 42 (Gallagher R)   Disaster relief: County of Butte: Camp Fire. This bill would state the intent of the Legislature to enact legislation that would provide for state allocations with respect to property tax revenue reductions resulting from reassessments for damages incurred within the County of Butte due to the 2018 Camp Fire.
• AB 53 (Jones-Sawyer D)   Rental housing discrimination: applications: criminal records. This bill would make it unlawful for the owner of any rental housing accommodation to deny the rental or lease of a housing accommodation without first satisfying specified requirements relating to the application process. The bill would prohibit the owner of a rental housing accommodation from inquiring about, or requiring an applicant for rental housing accommodation to disclose, a criminal record during the initial application assessment phase, as defined, unless otherwise required by state or federal law.
• AB 68 (Ting D)   Land use: accessory dwelling units. This bill would prohibit an ordinance from imposing requirements on minimum lot size, lot coverage, or floor area ratio, and would prohibit an ordinance from establishing size requirements for accessory dwelling units that do not permit at least an 800 square feet unit of at least 16 feet in height to be constructed.
• AB 69 (Ting D)   Land use: accessory dwelling units. This bill would authorize the department to submit written findings to a local agency as to whether the local ordinance complies with state law, and to notify the Attorney General if the ordinance violates state law. The bill would require a local agency to consider the department’s findings and would authorize the local agency to amend its ordinance to comply with state law or adopt a resolution with findings explaining why the ordinance complies with state law, and addressing the department’s findings.
• AB 188 (Daly D)   Fire insurance: valuation of loss. This bill would delete the provisions regarding the actual cash value of the claim of total loss to the structure and would instead require that the actual cash value of the claim, for either a total or partial loss to the structure or its contents, be the amount it would cost the insured to repair, rebuild, or replace the thing lost or injured less a fair and reasonable deduction for physical depreciation based upon its condition at the time of the injury or the policy limit, whichever is less.
• AB 191 (Patterson R)   Building standards: exemptions: rebuilding after disasters. This bill would, until January 1, 2030, exempt homes being rebuilt after wildfires or specified emergency events that occurred on or after January 1, 2017, from meeting certain current building standards.
• AB 195 (Patterson R)   Department of Housing and Community Development: grant-based programs: reporting. This bill would require the department to include in those annual reports specified information relating to grant-based programs administered by the department, including the amount of the original awards to recipients, the portions not yet disbursed to recipients, and an estimate of how many individuals could benefit from the remaining balance.
• SB 4 (McGuire D)   Housing. This bill would state the intent of the Legislature to enact legislation that would limit restrictive local land use policies and legislation that would encourage increased housing development near transit and job centers, in a manner that ensures that every jurisdiction contributes its fair share to a housing solution, while acknowledging relevant differences among communities.
• SB 5 (Beall D)   Local-State Sustainable Investment Incentive Program. This bill would establish in state government the Local-State Sustainable Investment Incentive Program, which would be administered by the Sustainable Investment Incentive Committee. The bill would authorize a city, county, city and county, joint powers agency, enhanced infrastructure financing district, affordable housing authority, community revitalization and investment authority or transit village development district to apply to the Sustainable Investment Incentive Committee to participate in the program and would authorize the committee to approve or deny applications for projects meeting specific criteria.
• SB 13 (Wieckowski D)   Accessory dwelling units. This bill would express the intent of the Legislature to enact legislation that would reduce impact fees and other existing barriers for homeowners seeking to create accessory dwelling units for the purpose of creating additional residential housing within their neighborhoods.
• SB 25 (Caballero D)   California Environmental Quality Act: qualified opportunity zones. This bill would establish specified procedures for the administrative and judicial review of the environmental review and approvals granted for projects located in qualified opportunity zones that are funded, in whole or in part, by qualified opportunity funds, or by moneys from the Greenhouse Gas Reduction Fund and allocated by the Strategic Growth Council.
• SB 50 (Wiener D)   Planning and zoning: housing development: equitable communities incentive. The bill would require that a residential development eligible for an equitable communities incentive receive waivers from maximum controls on density and automobile parking requirements greater than 0.5 parking spots per unit, up to 3 additional incentives or concessions under the Density Bonus Law, and specified additional waivers if the residential development is located within a 1/2-mile or 1/4-mile radius of a major transit stop, as defined. The bill would authorize a local government to modify or expand the terms of an equitable communities incentive, provided that the equitable communities incentive is consistent with these provisions.

Governor’s Inaugural Address

The Governor prioritized affordable housing among his top four major policy priorities in his inaugural speech today (early childhood education, universal healthcare and major drug pricing reform and immigration.) This was a great article that focused on his call for a “Marshall Plan” for affordable housing.

He passionately described recent visits to shelters and situations he had seen personally where families had pulled out drawers of their dressers to make cribs for their babies and piled blankets on the floor for the other children.  He said, “No one should live in constant fear of eviction or spend their whole paycheck to keep a roof overhead.” As for the homeless crisis, Newsom said, “We have a homeless epidemic that should keep each and every one of us up at night.”

Governor’s Executive Order

On January 15th, while in San Jose at a round table discussion, Governor Newsom announced a series of proposals to tackle housing affordability. As he noted during the campaign, housing proposals are a central pillar of his broader “California for All” agenda. Californians spend more of their income on housing costs than residents of almost any other place in America, and those huge costs are driving middle-class workers and their families further away from their jobs, and often out of the state. Meanwhile, a number of recent studies have warned that the state’s tight housing market will constrain future economic growth and deepen economic inequality.

At the event today, Governor Newsom laid out components of his plan to tackle the housing affordability crisis for families:

• An executive order, signed today, to spur affordable housing development on state land
• Developing affordable housing on state lands:Governor Newsom signed an executive order to develop affordable housing on excess state lands. The executive order directs the Department of General Services (DGS) to take an inventory of all state-owned lands for potential development no later than April 30, 2019. The Department of Housing and Community Development and Housing Finance Agency will be directed to develop new screening tools to evaluate state lands and, where appropriate, state agencies can consider exchanging excess state land with local governments for other parcels, for affordable housing development. DGS, in consultation with the Department of Housing and Community Development, can issue Requests for Proposals on individual parcels and accept proposals from developers of affordable housing interested in entering into low-cost, long-term ground leases of parcels on the priority map.
• $1.75 billion in new housing production dollars, laid out in his budget, to help incentivize housing production; and
• Asking the Legislature to work collaboratively on efforts to help renters and protect families from out-of-control rent increases.

Holland and Knight – Housing Presentation

On January 14th, Holland and Knight attorneys presented on the recently enacted housing laws – those taking effect in 2019 – in order to prepare Habitat for Humanity affiliates for upcoming changes in state law. Their presentation focused on the evolution of statewide housing legislation. Based on their observations, statewide housing legislation began to pick up in 2017 with 130 housing-related bills introduced, 16 signed into law that year and another 15 signed a year later by Governor Brown. 2017 was the year that the legislature recognized that local governments had not built the amount of housing necessary to shelter California residents and took action by focusing on Density Bonus law, allowing for concessions and incentives in development projects, and waiving certain development standards to increase building. The legislature also put tools in place to reduce barriers to building and increased accountability by requiring reporting on local regional housing needs allocation numbers.

Slides from the presentation are forthcoming.