Senate BillNo. 391


Introduced by Senator DeSaulnier

(Principal coauthors: Assembly Members Atkins and Bocanegra)

(Coauthors: Senators Correa, Hill, Leno, Lieu, and Pavley)

(Coauthors: Assembly Members Ammiano, Bloom, Bonilla, Gordon, Mullin, Quirk-Silva, and Torres)

February 20, 2013


An act to add Section 27388.1 to the Government Code, and to add Chapter 2.5 (commencing with Section 50470) to Part 2 of Division 31 of the Health and Safety Code, relating to housing.

LEGISLATIVE COUNSEL’S DIGEST

SB 391, as introduced, DeSaulnier. California Homes and Jobs Act of 2013.

Under existing law, there are programs providing assistance for, among other things, emergency housing, multifamily housing, farmworker housing, home ownership for very low and low-income households, and downpayment assistance for first-time homebuyers. Existing law also authorizes the issuance of bonds in specified amounts pursuant to the State General Obligation Bond Law. Existing law requires that proceeds from the sale of these bonds be used to finance various existing housing programs, capital outlay related to infill development, brownfield cleanup that promotes infill development, and housing-related parks.

This bill would enact the California Homes and Jobs Act of 2013. The bill would make legislative findings and declarations relating to the need for establishing permanent, ongoing sources of funding dedicated to affordable housing development. The bill would impose a fee, except as provided, of $75 to be paid at the time of the recording of every real estate instrument, paper, or notice required or permitted by law to be recorded. By imposing new duties on counties with respect to the imposition of the recording fee, the bill would create a state-mandated local program. The bill would require that revenues from this fee be sent quarterly to the Department of Housing and Community Development for deposit in the California Homes and Jobs Trust Fund, which the bill would create within the State Treasury. The bill would provide that moneys in the fund may be expended for supporting affordable housing, administering housing programs, and the cost of periodic audits, as specified. The bill would impose certain auditing and reporting requirements.

This bill would result in a change in state taxes for the purpose of increasing state revenues within the meaning of Section 3 of Article XIII  A of the California Constitution, and thus would require for passage the approval of 23 of the membership of each house of the Legislature.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

Vote: 23. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.

The people of the State of California do enact as follows:

P2    1

SECTION 1.  

This act shall be known as the California Homes
2and Jobs Act of 2013.

3

SEC. 2.  

The Legislature finds and declares that having a healthy
4housing market that provides an adequate supply of homes
5affordable to Californians at all income levels is critical to the
6economic prosperity and quality of life in the state. The Legislature
7further finds and declares all of the following:

8(a) Funding approved by the state’s voters in 2002 and 2006,
9as of June 2011, has financed the construction, rehabilitation, and
10preservation of over 11,600 shelter spaces and 57,220 affordable
11apartments, including 2,500 supportive homes for people
12experiencing homelessness. In addition, these funds have helped
1357,290 families become or remain homeowners. Nearly all of the
14voter-approved funding for affordable housing was awarded by
15the beginning of 2012.

P3    1(b) The requirement in the Community Redevelopment Law
2that redevelopment agencies set aside 20 percent of tax increment
3for affordable housing generated roughly one billion dollars
4($1,000,000,000) per year. With the elimination of redevelopment
5agencies, this funding stream has disappeared.

6(c) California has 12 percent of the United States population
7but 21.4 percent of its homeless population. Seventy-three percent
8of people experiencing homelessness in California fell into it
9because they could not afford a place to live. Sixty-two percent of
10homeless Californians are unsheltered, 14 percent are veterans,
11and 20 percent are families.

12(d) Furthermore, 4 of the top 10 metropolitan areas in the
13country for homeless are in the following metropolitan areas in
14California: San Jose-Sunnyvale-Santa Clara, Los Angeles-Long
15Beach-Santa Ana, Fresno, and Stockton.

16(e) California continues to have the second lowest
17homeownership rate in the nation, and minimum wage earners
18have to work 120 hours per week to afford the average
19two-bedroom apartment.

20(f) Millions of Californians are affected by the state’s chronic
21housing shortage, including seniors, veterans, people experiencing
22chronic homelessness, working families, people with mental,
23physical, or developmental disabilities, agricultural workers, people
24exiting jails, prisons, and other state institutions, survivors of
25domestic violence, and former foster and transition-aged youth.

26(g) While the current credit and foreclosure crisis has resulted
27in reductions in home prices in some areas, it has increased pressure
28on the rental housing market and slowed new housing production
29of all types, exacerbating the mismatch between the ever increasing
30number of households that need housing they can afford and the
31supply.

32(h) California’s workforce continues to experience longer
33commute times as persons in the workforce seek affordable housing
34outside the areas in which they work. If California is unable to
35support the construction of affordable housing in these areas,
36congestion problems will strain the state’s transportation system
37and exacerbate greenhouse gas emissions.

38(i) Many economists agree that the state’s higher than average
39unemployment rate is due in large part to massive shrinkage in the
40construction industry from 2005 to 2009, including losses of nearly
P4    1700,000 construction-related jobs, a 60-percent decline in
2construction spending, and an 83-percent reduction in residential
3permits. Restoration of a healthy construction sector will
4significantly reduce the state’s unemployment rate.

5(j) The lack of sufficient housing impedes economic growth
6and development by making it difficult for California employers
7to attract and retain employees.

8(k) To keep pace with continuing demand, the state should
9identify and establish a permanent, ongoing source or sources of
10funding dedicated to affordable housing development. Without a
11reliable source of funding for housing affordable to the state’s
12workforce and most vulnerable residents, the state and its local
13and private housing development partners will not be able to
14continue increasing the supply of housing after existing housing
15bond resources are depleted.

16(l) The investment will leverage billions of dollars in private
17investment, lessen demands on law enforcement and dwindling
18health care resources as fewer people are forced to live on the
19streets or in dangerous substandard buildings, and increase
20businesses’ ability to attract and retain skilled workers.

21(m) In order to promote housing and homeownership
22opportunities, the recording fee imposed by this act should not be
23applied to any recordings made in connection with a sale of real
24property. Purchasing housing is likely the largest purchase made
25by Californians, and it is the intent of this act not to increase
26transaction costs associated with these transfers.

27

SEC. 3.  

Section 27388.1 is added to the Government Code, to
28read:

29

27388.1.  

(a) (1) Except as provided in paragraph (2), in
30addition to any other recording fees specified in this code, a fee
31of seventy-five dollars ($75) shall be paid at the time of recording
32of every real estate instrument, paper, or notice required or
33permitted by law to be recorded except those expressly exempted
34from payment of recording fees. “Real estate instrument” includes,
35but is not limited to, the following documents: deed, grant deed,
36trustee’s deed, deed of trust, reconveyance, quit claim deed,
37fictitious deed of trust, assignment of deed of trust, request for
38notice of default, abstract of judgment, subordination agreement,
39declaration of homestead, abandonment of homestead, notice of
40default, release or discharge, easement, notice of trustee sale, notice
P5    1of completion, UCC financing statement, mechanic’s lien, maps,
2and covenants, conditions, and restrictions.

3(2) The fee described in paragraph (1) shall not be imposed on
4any real estate instrument, paper, or notice recorded in connection
5with a transfer subject to the imposition of a documentary transfer
6tax as defined in Section 11911 of the Revenue and Taxation Code.

7(b) The fees, after deduction of any actual and necessary
8administrative costs incurred by the county recorder in carrying
9out this section, shall be sent quarterly to the Department of
10Housing and Community Development for deposit in the California
11Homes and Jobs Trust Fund established by Section 50471 of the
12Health and Safety Code, to be expended for the purposes set forth
13in that section. In addition, the county shall pay to the Department
14of Housing and Community Development interest, at the legal
15rate, on any funds not paid to the Controller within 30 days of the
16end of a quarter.

17

SEC. 4.  

Chapter 2.5 (commencing with Section 50470) is added
18to Part 2 of Division 31 of the Health and Safety Code, to read:

19 

20Chapter  2.5. California Homes and Jobs Trust Fund
21

21 

22Article 1.  General Provisions
23

 

24

50470.  

This chapter shall be known, and may be cited, as the
25California Homes and Jobs Act of 2013.

26

50471.  

(a) There is hereby created in the State Treasury the
27California Homes and Jobs Trust Fund. All interest or other
28increments resulting from the investment of moneys in the fund
29shall be deposited in the fund, notwithstanding Section 16305.7
30of the Government Code. Moneys in the California Homes and
31Jobs Trust Fund shall not be subject to transfer to any other fund
32pursuant to any provision of Part 2 (commencing with Section
3316300) of Division 4 of Title 2 of the Government Code, except
34to the Surplus Money Investment Fund. Upon appropriation by
35the Legislature, moneys in the fund may be expended for the
36following purposes:

37(1) Supporting the development, acquisition, rehabilitation, and
38preservation of housing affordable to low- and moderate-income
39households, including, but not limited to, emergency shelters;
40transitional and permanent rental housing, including necessary
P6    1service and operating subsidies; foreclosure mitigation; and
2homeownership opportunities.

3(2) Administering housing programs that receive an
4appropriation from the fund. Moneys expended for this purpose
5shall not exceed 5 percent of the moneys in the fund.

6(3) The cost of periodic audits required by Section 50475.

7(b) Both of the following shall be paid and deposited in the
8fund:

9(1) Any moneys appropriated and made available by the
10Legislature for purposes of the fund.

11(2) Any other moneys that may be made available to the
12department for the purposes of the fund from any other source or
13sources.

14 

15Article 2.  Audits and Reporting
16

 

17

50475.  

The Bureau of State Audits shall conduct periodic audits
18to ensure that the annual allocation to individual programs is
19awarded by the department in a timely fashion consistent with the
20requirements of this chapter. The first audit shall be conducted no
21later than 24 months from the effective date of this section.

22

50476.  

In its annual report to the Legislature pursuant to
23Section 50408, the department shall report how funds that were
24made available pursuant to this chapter and allocated in the prior
25year were expended. The department shall make the report
26available to the public on its Internet Web site.

27

SEC. 5.  

No reimbursement is required by this act pursuant to
28Section 6 of Article XIII B of the California Constitution because
29a local agency or school district has the authority to levy service
30charges, fees, or assessments sufficient to pay for the program or
31level of service mandated by this act, within the meaning of Section
3217556 of the Government Code.



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