This week, the Legislature identified a package of bills to address California's  affordable housing shortfall.  The main pieces of legislation included in this package are Senate Bill 2 (Atkins) the "Building Homes and Jobs Act", Senate  Bill 3 (Beall) the "Veterans and Affordable Housing Bond Act of 2018", and Senate Bill 35 (Weiner). Following months of negotiations, t hese  bills would provide funding sources for the creation and development of affordable housing, and streamline building regulations for developers working on new housing projects. Below is a description of the bills and their effects on local governments: 
  • SB 2 would create new funding for very low, and low income housing development through real estate document transaction fees, generating nearly $250 million annually. The bill would require that that 50% of the moneys deposited in the fund be made available to local governments, and 50% made available to the Department of Housing and Community Development (HCD) to assist persons experiencing or at risk of homelessness. After January 1, 2019, 70% of funds collected would be distributed to local governments, and 30% would be allocate to HCD to, among other purposes, create mixed income multifamily residential housing for lower to moderate income households. Local governments that do not have a documented plan to expend moneys within five years would have their funds reverted and deposited in the Housing Rehabilitation Loan Fund (HRLF), 20% of the all moneys in the HRLF will be expended for affordable owner-occupied workforce housing housing, and housing related programs. 
  • SB 3 would authorize the issuance of bonds in the amount of $4 billion. Bond proceeds would be distributed in the amount of $3 billion to fund current housing programs, infill infrastructure financing, and affordable housing matching grant programs. The remaining $1 billion dollars in bond funding would be dedicated to housing purchasing assistance for veterans. SB 3 is focused on funding low income multifamily developments, farmworker housing and low income projects near transit. If this bill proposal were to pass out of the legislature it would appear as an initiative on the 2018 statewide ballot for voter consideration and approval. 
  • SB 35 would adopt a streamlined By-Right affordable housing approval process. If a developer were to meet State specified planning objective standards, that project would be eligible to receive a streamlined, ministerial approval process for production, and not be subject to a conditional use permit by a local government. If a local government were to not notify an applicant of their approval within a specified time frame, that project would be permitted through the streamlined process. The bill would limit the authority of a local governments to impose requirements on a streamlined development approvals, and impose new housing reporting requirements.  
Ahead of this affordable housing bill package announcement (and before this week's amendments), ACC-OC created and distributed a detailed compilation of input and feedback from Orange County cities on the items that municipalities would like to see included and omitted in an eventual affordable housing proposal. Included in ACC-OC's Affordable Housing Proposal Letter was the underlying point that cities do  not have the financial resources to work with developers in offering below market rate housing without assistance at the State level. Without a mechanism to ensure funding, no amount of regulatory reform or streamlining will have an impact on increased affordable housing.  Measures like SB 35 should not penalize cities who have prompted a good faith effort to meet their  affordable  housing   production  goals. In Orange County, many  cities have demonstrated  political will and work closely with developer  partners on approved affordable housing projects, ye t continually reach anywhere from a $1 million to $6 million gap in fulfilling  production. Cities do not have the general funds or housing set aside funds to cover this deficit . If projects, like the ones outline in ACC-OC's input letter, were  prioritized  for funding this would have an  immediate  impact on our affordable housing supply. Fu nding gaps result in missed affordable housing production opportunities and furthers the need to meet affordable housing obligations. 

For Orange County cities to be competitive and eligible to receive funding from this bill package the dedicated allotment needed for housing our workforce should continue to remain intact. It is estimated that Orange County will add an additional 372,458 jobs to the economy by 2040. By that time, projections show that for every one housing unit there will be 2.5 jobs. Our current supply of housing is not sustainable in meeting the needs of our workforce population. ACC-OC would emphasize the need for the continued awareness of housing options for diverse income level populations. Additionally, funds generated by SB 2 , which rely on the dispersal of moneys collected from real estate document transactions should be kept within the county where the transaction occurred, or at least retain a majority percentage.This would directly benefit those communities experiencing the highest housing shortfalls and prioritize local control. 


I f you are an Orange County city experiencing a funding gap scenario, please find a SAMPLE Affordable Housing Bill Package comment letter, here . You may outline your city's experience and express your city's opposition to SB 35. This bill package can be voted on as early as this week. 

A significant priority of ACC-OC and our members is ensuring that any new proposal language strikes the right balance of meeting housing needs without diminishing local control.  We will continue to analyze the development of these bills.  Should you have any questions please contact ACC-OC's L egislative Affairs Director, Diana Coronado at dcoronado@accoc.org   or at (714) 953-1300. 

View ACC-OC's SB 35 Opposition Letter, here .
View ACC-OC's Affordable Housing Proposal Input Letter, here.
View Sacramento Bee Article on Affordable Housing Deal, August 29th, here