Governor Newsom unveiled his revised May budget proposal this morning, which forecasts a budget deficit in the 2023-24 fiscal year of $32.5 billion—an increase from the $22.5 billion budget gap projected in January. In spite of the state’s uncertain fiscal situation, the Governor has committed to maintaining nearly $1.5 billion in critical affordable housing investments included in last year’s budget. This includes:

• $500 million continued annual investment in the state LIHTC program
• $250 million for adaptive reuse
• $225 million for the Infill Infrastructure Grant (IIG) Program
• $225 million for the Multifamily Housing Program (MHP)
• $100 million for the Portfolio Reinvestment Program
• $75 million for State Excess Sites
• $50 million for Joe Serna, Jr. Farmworker Housing Program
• $50 million for Veterans Housing and Homeless Prevention (VHHP) Program

The California Housing Consortium released the statement below from Executive Director Ray Pearl. CHC also joined this joint budget statement released by a coalition of housing production, homelessness, and housing justice advocates.

Ray Pearl statement on the May Revise:

“It is incredibly heartening to see Governor Newsom’s ongoing commitment in the May Revise to maintaining the state’s momentum toward addressing California’s affordable housing crisis. In spite of the state’s uncertain fiscal situation, the Administration’s spending proposal continues to invest in a wide range of programs we know have a strong track-record of producing the affordable housing struggling Californians need.”

“The Governor acknowledged again today that California must continue to find solutions that match the scale of the state’s affordable housing challenges—including what he called the state’s ‘legally binding’ commitment to produce 2.5 million units by 2030, at least one million of which need to be affordable.”

“Achieving these goals will require all of the targeted investments in the May Revise, as well as action on many other fronts. Affordable housing providers were pleased to see the recent budget proposal from Senate Democrats would double the size of the state’s Low Income Housing Tax Credit (to $1 billion per year) and set aside $300 million in flexible funding for HCD. A $10 billion housing bond, AB 1657 (Wicks), is also moving through the Assembly. Both of these proposals should be at the top of the state’s list of affordable housing priorities this year. ”

“CHC is looking forward to seeing more on the legislative package Governor Newsom promised to unveil next week, with new proposals for accelerating permitting and affordable housing construction. CHC is sponsoring several bills this year that share the same goal—including SB 439 (Skinner), which would give courts a new, special motion to strike non-meritorious litigation targeting approved housing projects; AB 1449 (Alvarez), a bill to strengthen existing CEQA exemptions for 100% affordable projects; and AB 1307 (Wicks), legislation that would reverse a troubling recent court decision by clarifying that residents’ voices should not be considered an environmental impact.”

“California needs more affordable housing, and a lot of it. We are fortunate to have a Governor who is a champion for our issue, and we continue to be ready to work with the Administration to help build more of the affordable housing Californians need.”