This week in affordable housing news…:

State update:

• Only a few days after his victory in this week’s recall election, Governor Newsom signed a package of high-profile housing bills and announced the launch of the new “California Housing Accelerator”—a $1.75 billion fund that aims to expedite construction of roughly 6,500 shovel-ready affordable housing projects stalled in the state’s backlogged housing financing system. “The housing affordability crisis is undermining the California Dream for families across the state,” the Governor said. “Making a meaningful impact on this crisis will take bold investments, strong collaboration across sectors, and political courage.” Among the housing bills signed by the Governor: SB 8 (Skinner), which extends the state’s Housing Crisis Act through 2030; SB 9 (Atkins), which streamlines duplex conversions; and SB 10 (Wiener), a bill allowing cities to rezone some parcels, including those near public transit, for small apartment buildings of up to 10 units.

• In another win for the Newsom Administration, a state appeals court issued a ruling this week limiting cities’ ability to stop new housing projects that comply with local plans and zoning. The Governor asked the state Attorney General to intervene last year in the case, California Renters Legal Advocacy and Education Fund v. City of San Mateo, which hinged on whether local housing actions by charter cities could be superseded by the state Housing Accountability Act. The appeals court ruled 3-0 that charter cities must abide by state laws seeking to hold local governments accountable for doing their part to increase housing supplies. “The court’s decision protects our ability to hold local governments to account and ensures that families throughout California won’t suffer when those same local leaders refuse to do their part to approve new housing,” the governor said in a news release.

• State Auditor Elaine Howle released a report this week warning that the state could lose as much as $337 million in federal funds if HCD doesn’t accelerate distribution of rent relief money ahead of the September 30 eviction moratorium deadline. Of the $2.6 billion the state received in the first round of COVID relief funds, HCD is responsible for distributing $1.8 billion—but, according to Howle, has not yet obligated all of these funds. HCD responded to the auditor’s report by noting that it has received “nearly $1.4 billion” in requested assistance and has paid “nearly $500 million” to date. The department interprets federal law differently than the Auditor, HCD director Gustavo Velasquez told The Hill: “California is not in serious risk of losing federal funding for rent relief.”

Federal:

• The House Ways & Means Committee advanced its portion of federal infrastructure legislation this week without modifying any of the housing tax credit provisions—another positive step toward including tax credit reforms in the final package later this fall. “Now is not the time to skimp on these investments. These are standards that Democrats should be setting. The nation indeed, I believe, is on our side,” said Chairman Richard Neal. The Affordable Housing Tax Credit Coalition has a summary of the Ways & Means markup here.

• As the infrastructure debate continues in Washington, the New York Times published a story this week on a looming challenge that could complicate this potential wave of investment: A shortage of skilled workers. S&P Global Ratings estimates that the bill could add $1.4 trillion to the U.S. economy over eight years, creating new jobs across the construction, transportation and energy industries. “But if there is not enough labor to keep up with the demand,” writes the Times, “efforts to strengthen the nation’s highways, bridges and public transit could be set back.” “Do we have the workforce ready right now to take care of this?” said Beverly Scott, vice chair of the President’s National Infrastructure Advisory Council. “Absolutely not.”

ICYMI – Top news stories:

Editorial: Recall was a slaughter. Will Newsom start acting boldly or play it safe until 2022?
San Francisco Chronicle
In the end, it wasn’t even close. Nor should it have been. Faced with their best chance to win the governorship in decades, California Republicans ran a coterie of carnival barkers and fools who all but threw the electorate into Gavin Newsom’s arms. The recall was a sham, perpetrated by a party that would rather play dirty tricks than adjust its policies to the 21st century. And voters knew it. It remains to be seen, however, if Newsom will regard his recall sweep as a mandate for bold action or justification for cautious triangulation. California doesn’t the have time, or, likely, the inclination, to indulge the latter.

Strategic coordination planned to address affordable housing, homelessness
CalMatters – Oped by Lourdes Castro Ramírez
California has often been criticized for lacking a comprehensive, holistic approach to housing and homelessness. When investments were made in the past, they were often scattered in their approach and design, with little strategic relation to other investments. This is changing. California is now poised to invest $10 billion to accelerate housing production and $12 billion to tackle homelessness. This is more than 10 times the budget of any previous year. As secretary of the Business, Consumer Services and Housing Agency, I am working closely with Gov. Gavin Newsom and an incredible team to ensure the effective and efficient delivery of these resources. 

Newsom beat the recall, now comes the hard part: Governing California
New York Times
For nearly a year—while a pandemic raged, while wildfires roared, while smoke smothered the once-pristine blue skies over Lake Tahoe—Gov. Gavin Newsom has had to simultaneously govern the nation’s most populous state and beat back an attempted recall. On Wednesday, he emerged victorious—but still had multiple crises to confront. Ninety percent of the state was in extreme drought. The median home price had eclipsed $800,000. Some 100,000 people were sleeping outside or in their cars nightly. And more than 6 million public school children were struggling to make up the learning they had missed because of the coronavirus pandemic. “These are problems that take time,” said [former Governor] Jerry Brown. The recall, Mr. Brown said, was “sound and fury signifying very little” —an “expensive blip” that in a couple of weeks “will be not much more than a footnote.” But, he said, “it’s down now to the bread and butter issues. And they’re the same old issues that have been around for a long time in modern California.”