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Sen. Beall’s $3 Billion Housing Bond Still in Play as Session Winds Down

Cities Encouraged to Support Effort to Get Bond to Governor’s Desk

August 18, 2016
It has been a long year in the Capitol for efforts to secure more affordable housing funding.
Few resources remain with redevelopment eliminated and state housing bonds exhausted. The session is in its final two weeks and discussions over the Gov. Jerry Brown’s by right proposal and the attached potential $400 million budget allocation appear stalled. There is however, one measure that still remains in play, SB 879, Sen. Jim Beall’s (D-San Jose) proposed $3 billion housing bond.

While some observers have discounted the possibility of a housing bond, possibilities still remain. The Senate passed SB 879 with a two-thirds bipartisan vote with Republican Senators Anthony Canella (R-Ceres) and Bob Huff (R-San Dimas) as co-authors. Now on the Assembly Floor, it could pass if several Republican votes can be secured — in addition to all Democrats. Sen. Beall recently amended the bill so that the measure would be placed on the November 2018 ballot, which avoids the politics associated with the many pending measures this November. 
If the bill could reach the Governor, there would be a strong alliance of housing advocates, labor, environmental, local governments and business groups urging him to sign it and give voters in 2018 an opportunity to pass a housing bond (The state has not had a housing bond since Proposition 1C of 2006). This would obviously not be a permanent solution to the state’s housing woes, but it would at least be a start. While the Governor has been resistant to new debt, he has approved a water bond. Furthermore, in the short term, there would be no state budget impacts since the bond would not be placed before the voters until the end of his term. So there is a possibility.
The funding in SB 879 would be allocated to the housing programs that were funded in Proposition 1C of 2006 in the following amounts:
  • $1.5 billion to the existing Multifamily Housing Program (MHP) to assist in the construction, rehabilitation, and preservation of permanent and transitional rental housing for persons with incomes of up to 60 percent of the area median income.
  • $600 million to the Transit-Oriented Development and Infill Infrastructure Account, which the bill creates within the Fund, and then allocates funds from the Account as follows:
    • $300 million to the existing Transit-Oriented Development Implementation Program.
    • $300 million to the Infill Infrastructure Financing Account for infill incentive grants to assist in new construction or rehabilitation of infrastructure that supports high-density affordable and mixed-income housing.
  • $300 million to the existing Joe Serna, Jr. Farmworker Housing Grant Fund.
  • $300 million to the Local Housing Trust Fund to provide matching grants to local public agencies and nonprofit organizations that raise money for affordable housing.
  • $300 million for the existing CalHome Program to provide direct, forgivable loans for mortgage assistance. 
Next Steps
Cities are encouraged to call their legislators and urge the passage of SB 879. Sample letters are available at www.cacities.org/billsearch by plugging SB 879 into the search function.  

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