BILL ANALYSIS                                                                                                                                                                                                    Ó






                      SENATE COMMITTEE ON VETERANS AFFAIRS
                              LOU CORREA, CHAIRMAN
                                             


          Bill No:        AB 1224
          Author:         Assembly Veterans Committee
          Version:        As Proposed
          Hearing Date:   April 10, 2012
          Fiscal:         Yes
          Consultant:     Donald E. Wilson




                                 SUBJECT OF BILL  
          Veterans' cooperative housing and 3-year Employment 
          Training Panel (ETP) veterans. 

                                   PROPOSED LAW  
           
           1.  Gives the California Department of Veterans Affairs 
          (CDVA) the authority to promulgate regulations for its new 
          authority regarding cooperative housing.

          2.  Requires the Employment Training Panel's (ETP) 
          three-year plan to include goals and strategies to support 
          target populations in need of employment training, 
          including military veterans and California National Guard 
          members.
                                         
                                 EXISTING LAW  
          
          1.  Provides for the establishment of employment training 
          programs and                specifies which individuals 
          qualify as "eligible participants" of the training 
          programs.

          2.  Establishes the Employment Training Panel (ETP) in the 
          Employment development and requires the Governor to appoint 
          the executive director and two assistant directors of ETP 
          specifying that at least one assistant director have 
          experience serving the needs of small business.

          3. Provides that ETP is governed by eight panel members.  
          Seven are appointed by the Governor and the leadership of 









          the Legislature and have backgrounds in business management 
          and employee relations, as specified.  The Secretary of 
          Business, Transportation and Housing, or his/her designee, 
          shall serve as an ex officio, voting member.

          4.  Specifies the duties of ETP to include the duty to make 
          contracts for training in job-related vocational  skills, 
          as specified and permits the ETP, subject to certain 
          requirements, to delegate its authority to approve 
          contracts for new hire training to any entity, as 
          specified, for purposes of serving the needs of small 
          businesses.

          5.  Requires the ETP, among other things, to establish a 
          3-year plan, as specified, that must be updated annually to 
          establish minimum standards for the consideration of 
          proposals, including the identification of employers and to 
          develop a process by which local workforce investment 
          boards may apply for marketing resources for the purpose of 
          identifying local employers that have training needs 
          reflecting the priorities of the panel.  Authorizes the ETP 
          to delegate its authority to approve contracts for training 
          to local workforce investment boards, as provided.

          6. Requires the ETP to allocate its annual funds for the 
          training programs designed for individuals who are 
          currently working and receiving specified benefits, as 
          provided.

          7. Authorizes the ETP to utilize funds in the Employment 
          Training Fund (ETF) for, among other expenditures, the 
          purpose of funding up to five licensed nurse training 
          programs to train individuals who are currently working as 
          nurse assistants or caregivers in a health facility, as 
          defined.

                                    EXISTING BACKGROUND  

          1.  In 1921, California chose to forego a wartime bonus for 
          World War I veterans and, instead, established a home loan 
          program to encourage home ownership.  

          2.  The latest generation of veterans was unable to take 
          advantage of this program until 2009 when the Federal 

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          Government finally updated the federal law concerning the 
          Cal-Vet Loan Program.  

          3.  Up until the renewal of the law, demand for the Cal-Vet 
          home loan program has dwindled as veterans loans had not 
          offered the benefits it once did.  As a result of the 
          ability to find better opportunities outside of the CDVA, 
          demand for the program dwindled.  Loans fell from 2,752 in 
          fiscal year 2000-01 to 954 in 2001-02.  The program failed 
          to break 1,000 loans again in 2002-03.  In the same year, 
          home improvement loans issued fell to 148.

          4.  Further problems for the program were that housing 
          prices in California were quickly outdistancing loan limits 
          under the program.  The California Department of Veterans' 
          Affairs (CDVA) thought it had solved the problem of 
          continually returning to the legislature for renewed 
          maximum loan values by tying the Cal-Vet loan limit to the 
          Federal Fannie Mae Limit (SB 1893, Johannessen, 2002.)

          5.  As home prices increased over the years, the Cal-Vet 
          program had to continually request increases for the 
          maximum allowed home loan amount in order to offer usable 
          loans for California priced property.  Eventually 
          California home prices far outdistanced the rest of the 
          nation and the Cal-Vet program had to continually request 
          increases for the maximum allowed home loan amount in order 
          to offer usable loans for California priced property.  
          Assembly Bill 1439 of 2005 (Assembly Veterans Affairs 
          Committee), finally fixed the loan limit amount for homes 
          to 125% of the Fannie Mae home loan limit.  Farms were 
          fixed to 150% of the loan limit.

          6.  In anticipation of the 2009 Federal Law change, SB 1572 
          of 2008 (Wyland) was put on the ballot as Proposition 12, 
          which authorized an additional $900 million dollars to the 
          Cal-Vet fund.

          7.  Equity housing cooperatives have traditionally not been 
          allowed to have loans associated with them.  Even though a 
          veteran might own a home within the cooperative, the 
          cooperative itself is a corporation that retains rights 
          over the property.  Since technically the veteran is not 
          the full owner Cal-Vet has not been able to give loans to 

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          veterans entering into these agreements since the veteran 
          is not an owner with right over his property.

          8.  Limited equity housing cooperatives (LEHC) have a 
          non-profit as the corporation and are meant to help those 
          with fewer financial means to get into a cooperative.

          9.  Since Vietnam it was discovered that many veterans may 
          not be ready to pick up where they left off when they left 
          civilian life.  Many veterans who returned home from 
          Vietnam were found on skid rows across America a decade 
          after the war and then diagnosed with post-traumatic stress 
          disorder (PTSD).  The lack of diagnosis and treatment for 
          PTSD condemned many to a life most would choose not to 
          follow.  Many have committed suicide or gotten into trouble 
          with the law.

          10. Veterans returning home now not only have PTSD but also 
          traumatic brain injury (TBI) and both have the potential to 
          put veterans who are returning home now in the same 
          position as many of those who returned from Vietnam.  
          Veterans' advocates have vowed to not let the same thing 
          happen to this generation.

          11. Veterans returning home now that are getting in legal 
          trouble or facing substance abuse problems are usually 
          those suffering from PTSD and/or TBI and veterans advocates 
          are hoping to find some form, or forms, of traditional 
          housing to help veterans that are going through treatment 
          or have recently finished treatment and are attempting to 
          fully integrate into civilian life.

          12.  Advocates believe that one way to encourage home 
          ownership for those returning to a full civilian life is to 
          allow the Cal-Vet program to give loans to veterans who 
          would like to buy into LEHC.




                                         
                                        



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                                    COMMENT  
          
          1.  Legislative Counsel advises that the ETP portions of 
          this bill have chaptering conflicts with AB 119.

          2.  This ETP portion of this bill deals with the same 
          subject matter as AB 3066 of 2009 (Assembly Veterans 
          Committee), AB 1567 of 2010 (Assembly Veterans Committee).  
          Both bills passed the committee without opposition, but 
          were vetoed by the previous governor.  AB 3066 was vetoed 
          by the governor.  AB 1567 was also vetoed and included the 
          following message-  

          "I appreciate the service and dedication our veterans have 
          provided to California and strongly support providing them 
          employment training and opportunities.  However, ETP 
          already supports employment training for military veterans 
          and its annual strategic planning process already puts a 
          strong focus on developing training projects and 
          partnerships in the veteran community.  As California 
          continues to struggle in these difficult economic times, 
          this bill would reduce ETP's flexibility to meet the 
          changing needs of California's employers and
          workers." 

          3.  The new sections of this bill deals with clean up 
          language on cooperative housing as established by AB 1330 
          of 2009 (Salas) and AB 2087 of 2010 (Torres).  AB 1084 of 
          2011 (Davis) added clean up language as this bill now does 
          for cooperative housing.  All of these bills passed the 
          committee and the senate floor without opposition.

          4.  If CDVA is now going to administer co-operative 
          housing, it likely needs to promulgate regulations.  The 
          department believes that this bill will give them the 
          authority to do so. 

                                     SUPPORT  
          
          American Legion, Department of California
          AMVETS-Department of California
          California Association of County Veteran Service Officers
          California State Commanders Veterans Council
          Vietnam Veterans of America - California State Council

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                                      OPPOSE  
          
          None received







































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