Amended in Senate May 20, 2013

Amended in Senate May 7, 2013

Amended in Senate April 2, 2013

Senate BillNo. 391

Introduced by Senator DeSaulnier

(Principal coauthors: Assembly Members Atkins, Bocanegra, and Gordon)

(Coauthors: Senators Block, Correa, Hancock, Hill, Leno, Lieu, Pavley,begin insert Price,end insert and Roth)

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

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,begin insert making an appropriation therefor,end insert and declaring the urgency thereof, to take effect immediately.


SB 391, as amended, 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.

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Existing law requires the Department of Industrial Relations to monitor and enforce compliance with applicable prevailing wage requirements for specified public works projects that are funded by state bond proceeds. Moneys collected for this purpose are continuously appropriated to the department from the State Public Works Enforcement Fund to cover the costs of these monitoring and enforcement duties.

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This bill would require the Department of Industrial Relations to monitor and enforce prevailing wage requirements for construction contracts for certain public works projects over $1,000,000, that are funded, in whole or in part, by the bill. The bill would authorize the department to charge each person or entity awarding a construction contract for the reasonable and directly related costs of the monitoring and enforcement activities, and would require the department to deposit the moneys collected into the State Public Works Enforcement Fund. The bill would exempt projects with a collective bargaining agreement with a mechanism for resolution of wage disputes from this requirement.

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By establishing a new source of revenue for a continuously appropriated fund, this bill would make an appropriation.

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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.

This bill would declare that it is to take effect immediately as an urgency statute.

Vote: 23. Appropriation: begin deleteno end deletebegin insertyesend insert. Fiscal committee: yes. State-mandated local program: yes.

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

P3    1


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


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.

16(b) The requirement in the Community Redevelopment Law
17that redevelopment agencies set aside 20 percent of tax increment
18for affordable housing generated roughly one billion dollars
19($1,000,000,000) per year. With the elimination of redevelopment
20agencies, this funding stream has disappeared.

21(c) California has 12 percent of the United States population,
22but 21.4 percent of its homeless population. Seventy-three percent
23of people experiencing homelessness in California fell into it
24because they could not afford a place to live. Sixty-two percent of
25homeless Californians are unsheltered, 14 percent are veterans,
26and 20 percent are families.

27(d) Furthermore, 4 of the top 10 metropolitan areas in the
28country for homeless are in the following metropolitan areas in
P4    1California: San Jose-Sunnyvale-Santa Clara, Los Angeles-Long
2Beach-Santa Ana, Fresno, and Stockton.

3(e) California continues to have the second lowest
4homeownership rate in the nation, and minimum wage earners
5have to work 120 hours per week to afford the average
6two-bedroom apartment.

7(f) Millions of Californians are affected by the state’s chronic
8housing shortage, including seniors, veterans, people experiencing
9chronic homelessness, working families, people with mental,
10physical, or developmental disabilities, agricultural workers, people
11exiting jails, prisons, and other state institutions, survivors of
12domestic violence, and former foster and transition-aged youth.

13(g) While the current credit and foreclosure crisis has resulted
14in reductions in home prices in some areas, it has increased pressure
15on the rental housing market and slowed new housing production
16of all types, exacerbating the mismatch between the ever-increasing
17number of households that need housing they can afford and the

19(h) California’s workforce continues to experience longer
20commute times as persons in the workforce seek affordable housing
21outside the areas in which they work. If California is unable to
22support the construction of affordable housing in these areas,
23congestion problems will strain the state’s transportation system
24and exacerbate greenhouse gas emissions.

25(i) Many economists agree that the state’s higher than average
26unemployment rate is due in large part to massive shrinkage in the
27construction industry from 2005 to 2009, including losses of nearly
28700,000 construction-related jobs, a 60-percent decline in
29construction spending, and an 83-percent reduction in residential
30permits. Restoration of a healthy construction sector will
31significantly reduce the state’s unemployment rate.

32(j) The lack of sufficient housing impedes economic growth
33and development by making it difficult for California employers
34to attract and retain employees.

35(k) To keep pace with continuing demand, the state should
36identify and establish a permanent, ongoing source or sources of
37funding dedicated to affordable housing development. Without a
38reliable source of funding for housing affordable to the state’s
39workforce and most vulnerable residents, the state and its local
40and private housing development partners will not be able to
P5    1continue increasing the supply of housing after existing housing
2bond resources are depleted.

3(l) The investment will leverage billions of dollars in private
4investment, lessen demands on law enforcement and dwindling
5health care resources as fewer people are forced to live on the
6streets or in dangerous substandard buildings, and increase
7businesses’ ability to attract and retain skilled workers.

8(m) In order to promote housing and homeownership
9opportunities, the recording fee imposed by this act should not be
10applied to any recordings made in connection with a sale of real
11property. Purchasing housing is likely the largest purchase made
12by Californians, and it is the intent of this act not to increase
13transaction costs associated with these transfers.


SEC. 3.  

Section 27388.1 is added to the Government Code, to



(a) (1) Commencing January 1, 2014, and except as
17provided in paragraph (2), in addition to any other recording fees
18specified in this code, a fee of seventy-five dollars ($75) shall be
19paid at the time of recording of every real estate instrument, paper,
20or notice required or permitted by law to be recorded except those
21expressly exempted from payment of recording fees. “Real estate
22instrument, paper, or notice” means a document relating to real
23property, including, but not limited to, the following: deed, grant
24deed, trustee’s deed, deed of trust, reconveyance, quit claim deed,
25fictitious deed of trust, assignment of deed of trust, request for
26notice of default, abstract of judgment, subordination agreement,
27declaration of homestead, abandonment of homestead, notice of
28default, release or discharge, easement, notice of trustee sale, notice
29of completion, UCC financing statement, mechanic’s lien, maps,
30and covenants, conditions, and restrictions.

31(2) The fee described in paragraph (1) shall not be imposed on
32any real estate instrument, paper, or notice recorded in connection
33with a transfer subject to the imposition of a documentary transfer
34tax as defined in Section 11911 of the Revenue and Taxation Code.

35(b) The fees, after deduction of any actual and necessary
36administrative costs incurred by the county recorder in carrying
37out this section, shall be sent quarterly to the Department of
38Housing and Community Development for deposit in the California
39Homes and Jobs Trust Fund established by Section 50471 of the
40Health and Safety Code, to be expended for the purposes set forth
P6    1in that section. In addition, the county shall pay to the Department
2of Housing and Community Development interest, at the legal
3rate, on any funds not paid to the Controller within 30 days of the
4end of a quarter.


SEC. 4.  

Chapter 2.5 (commencing with Section 50470) is added
6to Part 2 of Division 31 of the Health and Safety Code, to read:


8Chapter  2.5. California Homes and Jobs Trust Fund


10Article 1.  General Provisions




This chapter shall be known, and may be cited, as the
13California Homes and Jobs Act of 2013.



(a) There is hereby created in the State Treasury the
15California Homes and Jobs Trust Fund. All interest or other
16increments resulting from the investment of moneys in the fund
17shall be deposited in the fund, notwithstanding Section 16305.7
18of the Government Code. Moneys in the California Homes and
19Jobs Trust Fund shall not be subject to transfer to any other fund
20pursuant to any provision of Part 2 (commencing with Section
2116300) of Division 4 of Title 2 of the Government Code, except
22to the Surplus Money Investment Fund. Upon appropriation by
23the Legislature, moneys in the fund may be expended for the
24following purposes:

25(1) Supporting the development, acquisition, rehabilitation, and
26preservation of housing affordable to low- and moderate-income
27households, including, but not limited to, emergency shelters;
28transitional and permanent rental housing, including necessary
29service and operating subsidies; foreclosure mitigation; and
30homeownership opportunities.

31(2) Administering housing programs that receive an
32appropriation from the fund. Moneys expended for this purpose
33shall not exceed 5 percent of the moneys in the fund.

34(3) The cost of periodic audits required by Section 50475.

35(b) Both of the following shall be paid and deposited in the

37(1) Any moneys appropriated and made available by the
38Legislature for purposes of the fund.

P7    1(2) Any other moneys that may be made available to the
2department for the purposes of the fund from any other source or

begin insert

begin insert50472.end insert  

(a) This section applies to all construction projects in
5excess of one million dollars ($1,000,000) that are funded, in whole
6or in part, from the California Homes and Jobs Trust Fund, and
7that are public works within the meaning of Section 1720 of the
8Labor Code.

9(b) (1) The Department of Industrial Relations shall monitor
10and enforce compliance with applicable prevailing wage
11requirements for any construction contract on a project subject
12to this section and shall charge each person or entity awarding a
13construction contract for the reasonable and directly related costs
14of monitoring and enforcing compliance with the prevailing wage
15requirements. The department, with the approval of the Director
16of Finance, shall determine the rate or rates, which the department
17may from time to time amend, that the department shall charge to
18recover the reasonable and directly related costs of performing
19the monitoring and enforcement services for public works projects.
20However, the amount charged by the department shall not exceed
21one-fourth of 1 percent of the amount of the contract.

22(2) All moneys received by the department pursuant to this
23section shall be deposited into the State Public Works Enforcement
24Fund created by Section 1771.3 of the Labor Code.

25(3) Paragraph (1) shall not apply to a project if a collective
26bargaining agreement binds all of the contractors performing
27work on the project, and that collective bargaining agreement
28includes a mechanism for resolving disputes regarding the payment
29of wages.

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31Article 2.  Audits and Reporting




The California State Auditor’s Office shall conduct
34periodic audits to ensure that the annual allocation to individual
35programs is awarded by the department in a timely fashion
36consistent with the requirements of this chapter. The first audit
37shall be conducted no later than 24 months from the effective date
38of this section.



In its annual report to the Legislature pursuant to
40Section 50408, the department shall report how funds that were
P8    1made available pursuant to this chapter and allocated in the prior
2year were expended, including efforts to promote a geographically
3balanced distribution of funds. The department shall make the
4report available to the public on its Internet Web site.


SEC. 5.  

No reimbursement is required by this act pursuant to
6Section 6 of Article XIII B of the California Constitution because
7a local agency or school district has the authority to levy service
8charges, fees, or assessments sufficient to pay for the program or
9level of service mandated by this act, within the meaning of Section
1017556 of the Government Code.


SEC. 6.  

This act is an urgency statute necessary for the
12immediate preservation of the public peace, health, or safety within
13the meaning of Article IV of the Constitution and shall go into
14immediate effect. The facts constituting the necessity are:

15In order to provide affordable housing opportunities at the earliest
16possible time, it is necessary for this act to take effect immediately.