This week in affordable housing news…:

State Update:

The legislature, after a month off for their summer recess, reconvenes on Monday, August 1^st. There will be a whirlwind of legislative activity this month ahead of the end of session, which is Wednesday, August 31^st. Before the legislative year-end deadline, all bills with a fiscal impact will need to be out of the Appropriations committee by August 12^th and be sent to the floor for a final up or down vote. Bills that pass and have been amended, have one final step as they head back to their house of origin for final concurrence. The next month promises to be a busy one as we near the finish line and the end of this 2-year session.

• All three of CHC’s sponsored bills moved out of policy committees last month and have been referred to the Senate Appropriations Committee.

• AB 2011 (Wicks) will open underused commercial sites to affordable housing, while creating strong labor protections that support all of the workers on these projects. AB 2011 is set to be heard on August 1st. We expect it will placed on the suspense file, where the bill will either be passed or held at the Suspense Hearing on August 11th.

• AB 2334 (Wicks) increases the number of sites qualifying for expanded Density Bonuses available to 100% affordable projects. AB 2334 has not yet been set for a hearing, but we expect it will be heard on August 8th.

• AB 2006 (Berman) aims to streamline the state’s compliance monitoring system. AB 2006 is set to be heard on August 1st. We expect it will be placed on the suspense file, where the bill will either be passed or held at the Suspense Hearing on August 11th.

• SB 6 (Caballero), which became a two-year bill after it failed to meet the necessary deadline last year, is alive and moving after passing out of the Assembly Housing Committee in June. SB 6 would allow residential development on a commercial site where office and retail uses are permitted, but would trigger skilled and trained requirements for all workers on these projects. We are working with the author and Legislative leadership to ensure that AB 2011 and SB 6 serve complimentary purposes if they both pass.

• SB 1105 (Hueso) would establish the San Diego Regional Equitable and Environmentally Friendly Housing Agency (SD REEFHA) that would have the authority needed to raise funds for the production of new housing and the provision of renter protections. SB 679 (Kamlager) would establish the Los Angeles County Affordable Housing Solutions Agency (LACAHSA), and have the authority to raise funds for the purpose of funding affordable housing as well as renter provisions. Both SB 1105 and SB 679 would establish a new funding mechanism that would trigger project labor agreements (PLAs) by any project funded by the independent county agency.

• New CDLAC emergency regulations were adopted on July 20, which will have an immediate impact on the supplemental allocation process and Round 2 tie breaker, among other things. The language is available here: CDLAC Regulations

• This week, the State Board of Equalization held a meeting on property tax abatement. CHC’s Executive Director, Ray Pearl, was asked to share CHC’s perspective on the housing crisis and development challenges of building affordable housing in California. For more information, here is the link to the agenda: BOE Workgroup Meeting

• California took another incremental step toward expanding affordable housing development this month when the Governor signed AB 2244 (Wicks), a CHC-supported bill that will allow religious institutions to build more affordable housing on land they own by reducing parking requirements. While the legislation’s relatively smooth sailing through the Legislature has been viewed as a small win for the “YIGBYs,” another bill that sought to go further by allowing affordable housing projects to proceed “by right” on religious land, SB 1336 (Wiener), failed out to advance ahead of a June policy committee deadline due to opposition to the bill’s labor language.

• With housing costs rising, an estimated 1.5 million California households are now behind on the rent, according to a U.S. Census Bureau survey released in late July. New data from the California Budget & Policy Center finds renters of color, especially black renters, are struggling the most: 26% of black renters reported being behind on rent between March and June of this year, compared to 16% of Asian renters, 14% of Latino renters, and 8% of white renters. One in 6 renters (16%) with incomes under $50,000 reported being late on rent. The Budget & Policy Center’s proposed solution: “By removing barriers to affordable housing development and prioritizing meaningful funding to expand the supply of these homes, policymakers can ensure everyone has access to an affordable home.”

• It may only get harder to pay for housing this summer, as rents are expected to jump by as much as 10% in many parts of California starting on August 1, reports the Los Angeles Times, as the state for the first time reaches the upper limit of a statewide rent cap established in 2019 by AB 1482 (Chiu). While the Chiu legislation limited rent increases to 5% each year plus inflation, the LAT reports that this year’s rising inflation numbers mean “every region in the state” now meets the requirements for the cap to be set at 10%—apart from older apartments, areas with strict, local rent control rules, and some cities with ongoing COVID rental restrictions. For millions of Californians, starting next month, that means the rent is going to go up.

ICYMI – Top news stories:
Editorial: California should prioritize housing people, not cars
Los Angeles Times
If state leaders are serious about making California affordable, livable and sustainable, they’ve got to stop local laws that prioritize parking over people. One way to do that is eliminating parking requirements in new developments near transit, and there are two bills pending in the Legislature that would do just that. Assembly Bill 2097 by Assemblymember Laura Friedman (D-Glendale) would eliminate parking requirements for commercial projects and residential developments with 40 or fewer units that were within a half mile of a major transit stop. Senate Bill 1067 by Sen. Anthony Portantino (D-La Cañada Flintridge) would prohibit cities from imposing parking requirements on housing developments within a half-mile of a major transit stop if the project includes 20% affordable housing or the developer can show the project wouldn’t negatively affect parking in the area. 

The next battle in California’s housing crisis: Should cities tax empty homes?
San Francisco Chronicle
From San Francisco to Santa Cruz, Berkeley to Napa, politicians and residents frustrated by California’s housing crisis are turning to a tool gaining global popularity: taxing empty homes. While the details of recently proposed residential vacancy taxes vary, they’re already headed for the November ballot in San Francisco and the beach town of Santa Cruz. Berkeley, Napa, Los Angeles and areas of the Monterey Peninsula are debating similar measures. “There’s just this incredible need for housing,” said Sarah Karlinsky, a senior adviser to regional urban planning group SPUR. “People are looking at all different ways to either produce new housing or bring existing housing on (the) market, trying to make the most of what we have.” 

San Diego’s affordable housing policy is working. Now it’s being extended statewide.
San Diego Union-Tribune – Oped by Colin Parent, La Mesa City Councilmember
In order to address today’s housing crisis, San Diego needs a lot more homes. While no one program will solve our housing crisis on its own, San Diego is beginning to enjoy the success of one program it implemented in 2016. Circulate San Diego’s new report, “Home Run for Homes,” details how the city’s Affordable Homes Bonus Program is creating both market rate and subsidized affordable homes. In 2020, 44 percent of all homes entitled in San Diego were in projects that used the program. In addition, the program was used to create 463 deed-restricted affordable homes in mixed-income projects, financed without using scarce public subsidies. That means more affordable homes, without costing the taxpayer one dime.