BILL ANALYSIS Ó
AB 873
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 873 (Chau)
As Amended September 6, 2013
2/3 vote
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|ASSEMBLY: | |(May 16, 2013) |SENATE: |38-0 |(September 12, |
| | | | | |2013) |
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(vote not relevant)
Original Committee Reference: H. & C.D
SUMMARY : Establishes new eligible uses and priorities for
funding under the Emergency Housing and Assistance Program
(EHAP), with an added focus on providing permanent supportive
housing for homeless families and individuals.
The Senate amendments delete the Assembly version of this bill
and instead:
1)Allow the Department of Housing and Community Development
(HCD) to award EHAP capital development (EHAP-CD) funds in the
form of a 20-year forgivable loan for the conversion of
emergency shelters or transitional housing to permanent
supportive housing for homeless families or individuals.
2)Allow HCD to award EHAP operating facility grant (EHAP-OFG)
funds for the rapid rehousing of homeless clients.
3)With respect to EHAP award rounds that HCD initiates between
January 1, 2014, and June 30, 2015, allow HCD to award funds
pursuant to requirements exempt from the Administrative
Procedures Act and require HCD to:
a) Make funding available on a competitive basis statewide;
b) In addition to traditional applicants, accept
applications from public housing authorities, tribal
governments, and continuum of care entities;
c) Give priority for EHAP-CD funds to applicants proposing
to convert existing emergency shelters or transitional
housing to permanent supportive housing for homeless
families or individuals; and
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d) Give priority for EHAP-OFG funds to applicants that
propose rapid rehousing activities that leverage additional
funding sources or focus on high-cost users of more than
one system of care.
4)Require HCD to transfer any EHAP-CD funds derived from the
Proposition 46 or 1C housing bonds that remain as of June 30,
2015, to the supportive housing component of the Multifamily
Housing Program (MHP-SH).
5)Include chaptering amendments to address conflicts with AB
1109 (Bonilla) of the current legislative session.
AS PASSED BY THE ASSEMBLY , this bill clarified the definition of
"supportive housing" for purposes of Housing Element Law.
FISCAL EFFECT : According to the Senate Appropriations
Committee:
1)Minor and absorbable one-time costs to HCD to issue a new
notice of funding availability (NOFA). (Emergency Housing and
Assistance Fund).
2)One-time diversion of approximately $500,000 in general
obligation bond funds in 2015 from the Emergency Housing and
Assistance Fund to the Housing Rehabilitation Loan Fund for
use in the Multifamily Housing Program.
3)Potential future cost pressures to provide more operational
funds for supportive services that are offered in conjunction
with supportive housing.
COMMENTS : The Emergency Housing Assistance Program (EHAP),
administered by HCD, supports the development and operation of
emergency shelters, transitional housing facilities, and safe
havens, each of which has a limited term of tenancy. EHAP has
two components, EHAP-CD, which funds capital needs, and
EHAP-OFG, which funds operating costs. Historically, EHAP-CD
has received bond funds that may only be spent on capital
expenditures and EHAP-OFG has received General Fund support.
HCD makes EHAP-OFG funds available in the form of grants, with
each county allocated a share of available funding based on
poverty and unemployment rates. HCD awards EHAP-CD funds through
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a statewide competition and makes the awards available in the
form of forgivable loans with terms of five years for projects
involving rehabilitation, seven years for substantial
rehabilitation, and 10 years for acquisition and rehabilitation
or new construction. HCD defers payments on these loans and
forgives them at the completion of the term as long as
applicants use the facilities as emergency shelters or
transitional housing.
Existing law allows counties to apply for HCD designation as a
designated local board (DLB). Once designated, a DLB awards
EHAP-OFG funds within its county subject to an HCD-approved
local emergency shelter strategy. A DLB also prioritizes
EHAP-CD applications from its county, which HCD uses in its
competition. In the last round of EHAP-OFG funding, DLBs
represented 22 counties.
In addition to EHAP, HCD administers the Multifamily Housing
Program, which includes a supportive housing component (MHP-SH)
that funds the development of permanent rental homes (i.e.,
housing that has no time limit on length of stay) with support
services for persons who are homeless or at risk of becoming
homeless.
This bill allows HCD to award EHAP-CD funds in the form of a
20-year forgivable loan for the conversion of existing emergency
shelters or transitional housing to permanent supportive housing
for homeless families or individuals. The bill additionally
allows HCD to award EHAP-OFG funds for the rapid rehousing of
homeless clients. For any EHAP award rounds that HCD initiates
between January 1, 2014, and June 30, 2015, the bill requires
HCD to give priority to applicants that will use the funds for
these newly authorized activities and to make funding available
on a competitive statewide basis rather than delegating funds
and prioritization to the DLBs.
According to the author, the federal government has adopted a
new approach to combating homelessness that focuses funding
priority on permanent housing rather than on transitional
housing and on rapidly rehousing homeless individuals and
families rather than on shelters. This bill aligns EHAP with
these evidence-based strategies in order to both improve
outcomes and increase the competitiveness of California
applicants for federal funding opportunities.
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EHAP-CD currently has about $7 million available and EHAP-OFG
has about $1 million available. Given these relatively small
amounts, the bill seeks to streamline the award process by
allowing HCD to make the bill's changes to the program without
adopting regulations and by temporarily foregoing the DLB
prioritization process in favor of a statewide competition. In
addition, to the extent that any EHAP-CD funds remain after one
more round of awards, the bill requires HCD to transfer the
funds to MHP-SH.
This bill was substantially amended in the Senate and the
Assembly version of this bill was deleted. The contents of this
bill have not been heard in an Assembly policy committee.
Analysis Prepared by : Anya Lawler / H. & C.D. / (916)
319-2085
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