Legislative Update – September 22, 2017

Comprehensive Housing Package Heads to Governor’s Desk

After a long, hard fought effort and approaching the deadline for approving bills for the 2017 session, Assembly and Senate leaders voted late last week to pass a comprehensive package of housing bills.

The bills now head to the Governor for signature. He has until October 15 to take action. The good news is that the Governor has previously signaled his intention to sign the package.

Once he signs, we will be in campaign mode once again – for the Veterans and Affordable Housing Bond Act of 2018. The Bond Act, authored by Senator Jim Beall, will be on the November 2018 ballot, and would add $4 billion in funding for affordable housing. The $250+ million projected from the passage of the Permanent Source Bill (Senator Atkins’ SB2), added to the Bond Act funding, would constitute the largest State commitment to affordable housing in California history.

For the first year of SB 2, known as the Building Homes and Jobs Act, half of the funding will go to local government agencies for planning activities and the other half will be devoted to homeless programs. We understand that after that first year, 70% of the funds will be directly distributed to local governments according to formula with the remaining 30% going to The Department of Housing and Community Development (HCD). More to come as we dive into the bill’s changes in the days leading to passage.
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The Strategies:

Lawmakers are discussing different approaches in the housing package.

Provides new funding to subsidize housing for low-income residents

Housing-Element Law:
The state law requiring cities and counties to include housing needs as an element in their general plans.

By Right:
A streamlined approval process in which projects that meet zoning and other requirements are not subject to individual environmental reviews and city council or county supervisor votes.

Housing Accountability Act:
Also known as the Anti-NIMBY Act (Not In My Backyard) limits local governments from rejecting or making infeasible housing developments without thoroughly analyzing that action’s effects.

Preservation Notice Law:
Requires owners of subsidized rental units to notify occupants before units revert to market-rate pricing, and give purchasers a chance to buy and preserve affordability.

Inclusionary Housing:
Requires developers of market-rate housing to charge below-market prices/rents for a percentage of units built.


The Bills:

Details on the current bills in the housing package:

SB 2 – Building Homes and Jobs Act (Revenue)
Introduced by Sen. Toni Atkins (D-San Diego). Requires a two-thirds vote.
Creates a new $75 fee on real estate transaction documents – excluding home sales – up to 3 ($225) per transaction, projected to raise $200-300 million per year.

SB 3 – Affordable Housing Bond Act of 2018 (Revenue)
Introduced by Sen. Jim Beall (D-San Jose). Requires a two-thirds vote.
Would place a $4 billion general obligation bond on November 2018 ballot, with $1 billion set aside for a veterans’ home loan program.

SB 35 – Affordable housing: streamlined approval process (By Right)
Introduced by Sen. Scott Wiener (D-San Francisco). Requires a majority vote.
Forces cities and counties that fail to meet state-mandated housing production
goals to approve multi-family, urban development projects that meet certain requirements, such as paying construction workers a prevailing wage.

SB 540 – Workforce Housing Opportunity Zone (By Right)
Introduced by Sen. Richard Roth (D-Riverside). Requires a majority vote.
Allows cities to create priority-housing zones with front-loaded planning and environmental reviews, so development projects that meet certain requirements
would win expedited approval.

AB 73 – Housing Sustainability Districts (By Right)
Introduced by Asm. David Chiu (D-San Francisco). Requires a majority vote.
Would provide state incentive payments to cities that rezone more densely with a certain level of affordability, particularly around transit, and improve environmental reviews. Similar setup to SB 540, but with incentives.

SB 167 / AB 678 (Housing Accountability Act)
Introduced by Sen. Nancy Skinner (D-Berkeley) / Asm. Raul Bocanegra (D-Pacoima). Requires a majority vote.
Increases the burden of proof a city or county must meet to deny a housing project, awards damages to developers if local governments act in bad faith, and requires courts to fine cities and counties for not complying with the Housing Accountability Act.

AB 1515 – Planning and zoning: housing (Housing Accountability Act)
Introduced by Asm. Tom Daly (D-Anaheim). Requires a majority vote.
Requires courts to give less deference to local governments in legal challenges
when a city or county determines a housing project is inconsistent with its general
plan and zoning standards.

AB 72 – Housing (Housing-Element Law)
Introduced by Asm. Miguel Santiago (D-Los Angeles). Requires a majority vote.
Requires the CA Dept. of Housing and Community Development to review local governments’ general plans and actions on housing proposals for compliance with
state law, and allows it to report violations to the Attorney General.

AB 1397 – Inventory of land for residential development (Housing-Element Law)
Introduced by Asm. Evan Low (D-Campbell). Requires a majority vote.
Limits cities and counties from counting locations without a realistic capacity for new housing toward their general plan’s inventory of potential housing units.

SB 166 – Residential density and affordability (Housing-Element Law)
Introduced by Sen. Nancy Skinner (D-Berkeley). Requires a majority vote.
Requires cities and counties general plans to always ensure their general plans
include enough potential development sites to meet their unmet housing needs.

AB 879 – Planning and zoning: housing element (Housing-Element Law)
Introduced by Asm. Tim Grayson (D-Concord). Requires a majority vote.
Requires local governments to include an expanded analysis of nongovernmental constraints on housing development in the housing elements of their general plans.

AB 1521 – Land use: notice of proposed change: assisted housing developments (Preservation Notice Law)
Introduced by Asm. Richard Bloom (D-Santa Monica). Requires a majority vote.
Strengthens Preservation Notice Law to give advance notice of subsidized rental units returning to market-rate pricing, and requires owners to sell to qualified buyers who make fair market value offers.

AB 1505 – Land Use: Zoning Regulations (Inclusionary Housing)
Introduced by Asm. Richard Bloom (D-Santa Monica). Requires a majority vote.
Would restore right of cities and counties to apply inclusionary housing policies to
rental developments, overturning 2009 appellate court ruling.

AB 571 – Farmworker housing tax credit (Tax Credit)
Introduced by Asm. Eduardo Garcia (D-Coachella). Requires a two-thirds vote.
Expands a state income tax credit intended to encourage developers to build farmworker housing projects.

Thank you for making the time to take action these past few months. Together, our voices are louder.

Chair | Habitat for Humanity California Legislative Committee
President/CEO | San Diego Habitat for Humanity