BILL ANALYSIS
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
2064 (J. Perez)
Hearing Date: 08/02/2010 Amended: 07/01/2010
Consultant: Mark McKenzie Policy Vote: T&H 6-2
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BILL SUMMARY: AB 2064, an urgency measure, would require the
Department of Housing and Community Development (HCD) to issue a
Notice of Funding Availability (NOFA) for the amount of General
Fund monies available for the Emergency Housing and Assistance
Program, and award grants within 180 days of issuing the NOFA.
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Fiscal Impact (in thousands)
Major Provisions 2010-11 2011-12 2012-13 Fund
HCD administration $200 Special*
Foregone reversion $4,000 General
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* Emergency Housing and Assistance Fund
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STAFF COMMENTS: This bill meets the criteria for referral to the
Suspense File.
The Emergency Housing and Assistance Program (EHAP),
administered by HCD, funds emergency shelters, transitional
housing, safe havens, rental assistance programs, and cold wet
weather providers. The funds are used to assist housing
programs with operational costs and provides for the expansion
of bed capacity and/or supportive services offered to homeless
clients. Within the EHAP program are two different funding
programs: EHAP-CD which funds construction to increase capacity
and EHAP Operations Grants which provide funding for emergency
shelters, transitional housing projects, and supportive services
for homeless individuals and families.
The Budget Act of 2000-01 appropriated $14 million from the
General Fund to EHAP's operations element. By the 2004-05
fiscal year, that annual appropriation had dropped to $4
million, where it remained through the 2007-08 fiscal year. In
September 2008, an appropriation of $4 million was vetoed, as
were funds for other programs receiving General Fund moneys, in
response to an emerging critical shortfall in state revenues.
The 2009-10 Budget Act did not include an appropriation for the
EHAP program, and the Governor's proposed 2010-11 Budget would
transfer any funds remaining in the EHAP Fund (indentified as
$4.177 million) into the General Fund. The Legislature has not
taken final action on this item to date.
AB 2064 would require the Department of Finance to determine the
amount of General Fund monies remain in the EHAP Fund and
require HCD to issue a NOFA within 30 days of the effective date
of the bill, indicating the amount available for the shelter
operations program. HCD would also be required to grant awards
for the program within 180 days of issuing the NOFA.
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AB 2064 (J. Perez)
Staff notes that the Budget Act generally requires
appropriations for capital outlay are available and must be
encumbered within three years. The Budget Act of 2007-08, SB 77
(Evans), Chapter 171 of 2007, included a $4 million General Fund
appropriation from the General Fund to the Emergency Housing and
Assistance Fund for "operating facilities and capital
development grants" (Item 2240-105-0001). Section 1.80 (b)
requires, among other things, that all capital outlay funds are
available until June 30, 2010. After this date, all remaining
funds would revert to the General Fund. AB 2064, an urgency
measure, would instead require these funds to be allocated
within 210 days of the bill's effective date. Under existing
law, these funds should revert to the General Fund. This bill
would prevent that reversion, if it has not already occurred.
HCD indicates that since recent budgets have not included any
funding for the program, all staff previously dedicated to EHAP
have been reassigned to other programs. Therefore, neither the
publication of an EHAP NOFA nor the award of funds required by
AB 2064 could be accomplished. In addition, if the Governor's
proposed budget action is approved by the Legislature prior to
the enactment date of this bill, there would be no EHAP funding
available for the program. Under normal circumstances (if
funding and staff were available), HCD generally expends up to 5
percent of allocated funds for state operations related to
administering the program, which would equate to $200,000 if $4
million in funds are available. Given the short timeframes
identified in the bill for HCD to issue a NOFA and allocate
funds, staffing costs could be higher and would have to be
redirected from other HCD-administered programs.