BILL ANALYSIS Ó SENATE TRANSPORTATION & HOUSING COMMITTEE BILL NO: ab 1109 SENATOR MARK DESAULNIER, CHAIRMAN AUTHOR: bonilla VERSION: 5/2/13 Analysis by: Mark Stivers FISCAL: yes Hearing date: July 2, 2013 SUBJECT: Emergency Housing Assistance Program DESCRIPTION: This bill deems an Emergency Housing Assistance Program - Capital Development award recipient that converts the emergency shelter or transitional housing development to permanent housing that serves people who are homeless or at risk of homelessness to be in compliance with the program's loan deferral and forgiveness conditions. ANALYSIS: Administered by the Department of Housing and Community Development (HCD), the Emergency Housing Assistance Program (EHAP) 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: the EHAP capital development component (EHAP-CD), which funds capital needs; and the EHAP operating facility grant component, which funds operating costs. HCD awards EHAP-CD funds through 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, or ten years for acquisition and rehabilitation or new construction. HCD defers payments on these loans as long as applicants use the facilities as emergency shelters or transitional housing, and HCD forgives the loans entirely at the completion of these terms. This bill deems an EHAP-CD recipient that converts the emergency shelter or transitional housing development to permanent housing (i.e., housing that has no time limit on tenancy) that serves people who are homeless or at risk of homelessness to be in compliance with the program's loan deferral and forgiveness AB 1109 (BONILLA) Page 2 conditions. COMMENTS: Purpose of the bill . According to the author, the federal government has adopted a new approach to combating homelessness which focuses funding priority on permanent housing rather than transitional housing. In general, transitional housing providers have been able to renew their previous grants thus far, but they are not competitive for new monies, nor do they increase the competitiveness of their jurisdiction as a whole for new funding. Unfortunately, EHAP-CD recipients cannot transition their service model to compete for these new funds because state law locks them in to the emergency shelter and transitional housing model. This is true even if modifying their service model would allow them to better serve the target population or keep their doors open. This bill allows EHAP-CD recipients to be more competitive for federal housing funding by allowing them to convert existing facilities to permanent housing without requiring repayment of the EHAP loan. Assembly Votes: Floor: 71-0 Appr: 16-0 H&CD: 7-0 POSITIONS: (Communicated to the committee before noon on Wednesday, June 26, 2013.) SUPPORT: Housing California (sponsor) Abode Services American Federation of State, County and Municipal Employees California Rural Legal Assistance Foundation Corporation for Supportive Housing Everyone Home Sacramento Housing Alliance United Outreach of El Dorado County Western Center on Law and Poverty OPPOSED: None received. AB 1109 (BONILLA) Page 3