This morning, Governor Newsom unveiled his revised May budget proposal, which projects a $97.5 billion surplus, maintains support for his January budget’s affordable housing and homelessness investments, and includes new proposals for adaptive reuse ($500 million) and rental assistance ($2.7 billion) that are outlined below. The proposal now goes before the Legislature, which must approve a final 2022-2023 state budget by June 15. 

Key affordable housing proposals in the Governor’s May Revise include:

• $1 billion in one-time funds to accelerate affordable development in downtown areas (including $500 million for the Infill Infrastructure Grant Program, $300 million for the Affordable Housing and Sustainable Communities Program, and two new $100 million investments in state excess site development and adaptive reuse incentive grants)

• $200 million for the Portfolio Reinvestment Program

• $200 million for the CalHFA Mixed-Income Program

• $500 million for the Low-Income Housing Tax Credit

• NEW – $500 million for adaptive reuse—converting existing infrastructure, underutilized retail space, and commercial buildings into housing

• NEW – $2.7 billion in emergency rental assistance

Statement from CHC’s Ray Pearl:

“As California continues to struggle through the pandemic, the last year has shown once again the essential role affordable housing plays in supporting our state’s most vulnerable groups.”

“We appreciate Governor Newsom’s ongoing commitment to making affordable housing and homelessness a top priority—and his willingness to support struggling renters and consider new ways to accelerate production of the affordable housing every community needs.”

“With the state enjoying a nearly $100 billion surplus, we believe the Governor’s proposed investment in housing is a missed opportunity to respond at the scale of the state’s affordable housing challenges. California has thousands of approved, shovel-ready affordable housing units waiting for financing—each one of them a potential home for the many lower-income families and workers on housing waiting lists. The state can and should do more in this year’s budget to get this housing built for the Californians who desperately need it.”

“If the pandemic has taught us anything, it is that we must move even more quickly and decisively to increase access to affordable housing in every community. California’s housing crisis demands more than temporary solutions. We look forward to working with the Governor and Legislature to expand this new budget proposal—and ensure state resources produce more of the safe, high-quality housing struggling Californians need.”