BILL ANALYSIS �
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|SENATE RULES COMMITTEE | SB 391|
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THIRD READING
Bill No: SB 391
Author: DeSaulnier (D), et al.
Amended: 5/20/13
Vote: 27 - Urgency
SENATE TRANSPORTATION & HOUSING COMMITTEE : 6-3, 4/9/13
AYES: DeSaulnier, Beall, Hueso, Lara, Liu, Pavley
NOES: Gaines, Galgiani, Wyland
NO VOTE RECORDED: Cannella, Roth
SENATE GOVERNANCE & FINANCE COMMITTEE : 5-2, 4/24/13
AYES: Wolk, Beall, DeSaulnier, Hernandez, Liu
NOES: Knight, Emmerson
SENATE APPROPRIATIONS COMMITTEE : 5-2, 5/23/13
AYES: De Le�n, Hill, Lara, Padilla, Steinberg
NOES: Walters, Gaines
SUBJECT : California Homes and Jobs Act of 2013
SOURCE : California Housing Consortium
Housing California
DIGEST : This bill imposes, beginning January 1, 2014, a fee
of $75 on the recording of each real estate-related document,
except for those documents recorded in connection with a
transfer subject to a documentary transfer tax, and directs the
money to the California Homes and Jobs Trust Fund (Trust Fund).
The Legislature may then appropriate these funds for the
development, acquisition, rehabilitation, and preservation of
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homes affordable to low- and moderate-income households,
including emergency shelters, transitional and permanent rental
housing, foreclosure mitigation, and homeownership
opportunities.
ANALYSIS : Existing law establishes a number of programs at
the Department of Housing and Community Development (HCD) and
the California Housing Finance Agency to make housing more
affordable to California families and individuals, including the
following main programs:
Multifamily Housing Program, which funds the new
construction, rehabilitation, and preservation of permanent
and transitional rental homes for lower income households
through loans to local governments, non-profit developers,
and for-profit developers.
Joe Serna, Jr., Farmworker Housing Program, which funds the
development of ownership or rental homes for agricultural
workers through grants to local governments and non-profit
organizations.
Emergency Housing Assistance Program, which funds emergency
shelters and transitional homes for homeless individuals and
families through grants to counties and non-profit entities
for rehabilitation, renovation, expansion, site acquisition,
and equipment.
CalHome Program, which funds downpayment assistance, home
rehabilitation, counseling, self-help mortgage assistance
programs, and technical assistance for self-help and shared
housing through grants and loans.
California Homebuyer Downpayment Assistance Program, which
aids first-time homebuyers with down payment and/or closing
costs.
Historically, the State has funded these programs through the
sale of general obligations bonds. Most recently, the voters
approved a $2.1 billion bond through Proposition 46 in 2002 and
then a $2.85 billion bond through Proposition 1C in 2006. These
funds financed the construction, rehabilitation, and
preservation of 57,220 affordable apartments, including 2,500
supportive homes for people experiencing homelessness, and over
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11,600 shelter spaces. In addition, these funds have helped
57,290 families become or remain homeowners. HCD has awarded
almost all of the funds made available under these propositions,
particularly in these main programs.
Until 2011, the Community Redevelopment Law required
redevelopment agencies to set aside 20% of all tax increment
revenue to increase, improve, and preserve the community's
supply of low- and moderate-income housing available at an
affordable housing cost. In fiscal year 2009-10, redevelopment
agencies deposited $1.075 billion of property tax increment
revenues into their Low- and Moderate-Income Housing Funds.
With the elimination of redevelopment agencies, this source of
funding for affordable housing is no longer available.
This bill:
1. Enacts the California Homes and Jobs Act of 2013 (Act) which
imposes a fee, beginning January 1, 2014, of $75 on the
recording of each real estate instrument, paper, or notice,
except for those documents recorded in connection with a
transfer subject to a documentary transfer tax, and directs
the money to the Trust Fund.
2. Allows the funds to be appropriated for the development,
acquisition, rehabilitation, and preservation of homes
affordable to low- and moderate-income households, including
emergency shelters, transitional and permanent rental
housing, foreclosure mitigation, and homeownership
opportunities.
3. Limits administrative costs to 5% of the funds for
administering housing programs that receive an appropriation
from the Trust Fund.
4. Requires HCD to report annually to the Legislature on how
funds made available and allocated under this Act, including
efforts to promote a geographically balanced distribution of
the funds.
5. Requires the Department of Industrial Relations to monitor
and enforce prevailing wage requirements for construction
contracts for public works projects over $1,000,000, that are
funded, in whole or in part, by this bill.
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6. Requires the Bureau of State Audits (BSA) to conduct periodic
audits to ensure that state agencies award appropriated funds
in a timely fashion consistent with legal requirements.
Requires the first audit be conducted within two years of the
effective date of the Act.
Background
Types of documents covered . This bill applies the $75 fee to
the recording of all real estate instrument, paper, or notice
except those recorded in connection with a transfer subject to
the imposition of a documentary transfer tax and those expressly
exempted from payment of recording fees. There are many types
of documents that fall under the proposed fee, including, but
not limited to:
Deeds and grant deeds
Trustees' deeds and deeds of trust
Amendments of deeds of trust
Quit claim deeds
Fictitious deeds of trust
Assignments of deeds of trust
Construction trust deeds
Reconveyances
Easements
Maps
Lot line adjustments
Covenants, conditions, and restrictions
Affidavits
Abstracts of judgment
Subordination agreements
Declarations and abandonments of homestead
Requests for notice of default
Notices of default
Notices of trustee sale
Substitution of trustee
Trustee's deed upon sale
Notices of completion
Notice of rescission of declaration of default
Liens
Releases or discharges
Leases and assignments of leases
Assignments of rents
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Uniform Commercial Code amendment, assignment, continuation,
statement, or termination
FISCAL EFFECT : Appropriation: Yes Fiscal Com.: Yes
Local: Yes
According to the Senate Appropriations Committee:
Unknown fee revenue gains ranging from $300 million to $720
million per year depending on the volume of recorded
documents (Trust Fund).
Estimated annual administrative costs of approximately $5.4
million (Trust Fund) to fund up to 47 positions at the HCD.
All HCD administrative costs are fully covered by fees
collected.
Costs in the range of $250,000 to $350,000 (Trust Fund) in
2016-17 to the BSA to conduct an initial audit. Ongoing
periodic audit costs in the range of $150,000 to $250,000
(Trust Fund). All BSA audit costs are fully covered by fees
collected.
Unknown local mandate costs, not state-reimbursable. This
bill authorizes the county recorder to deduct actual and
necessary costs to administer to collection of recordation
fees prior to transmitting the balance to the State.
SUPPORT : (Verified 5/23/13)
California Housing Consortium (co-source)
Housing California (co-source)
State Treasurer Bill Lockyer
A Community of Friends
AARP
Abode Communities
Advent Companies
AFSCME
Alameda County Developmental Disabilities Council
Alpha Construction Company
AMCAL Multi-Housing
American Baptist Homes of the West
American Planning Association, California Chapter
Amity Foundation
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Amstutz Associates
Angelus Plaza
Ashwood Construction
Asian Pacific Environmental Network
Aspiranet
Association of Regional Center Agencies
Asthma Coalition of Los Angeles County
Bay Area Business Roundtable
Bay Area Community Land Trust
Bay Area Council
Bay Area Regional Health Inequities Initiative
BRC Advisors
BRIDGE Housing
Burbank Housing Development Corporation
Cabrillo Economic Development Corporation
Cahill Contractors
California Apartment Association
California Association of Housing Authorities
California Association of Local Housing Finance Agencies
California Building Industry Association
California Coalition for Rural Housing
California Coalition for Youth
California Conference of Carpenters
California Council for Affordable Housing
California Council of Community Mental Health Agencies
California Disability Services Association
California Housing Partnership Corporation
California Labor Federation
California Mental Health Directors Association
California Mental Health Planning Council
California Partnership to End Domestic Violence
California Police Chiefs Association
California Reinvestment Coalition
California Rural Legal Assistance Foundation
California School Employees Association
Carson Chamber of Commerce
Casa Major
Central City Association
Century Housing
Century Villages at Cabrillo
Cesar Chavez Foundation
CHISPA
Cities of Berkeley, Burbank, Calexico, Del Mar, El Centro, El
Monte, Emeryville, Fairfield, Goleta, Jurupa Valley,
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Livingston, Los Angeles, Lynwood, Oakland, Oxnard, Pasadena,
Sacramento, San Francisco, San Joaquin, San Jose, San Luis
Obispo, San Mateo, Santa Barbara, Santa Monica, Torrance,
Ventura, Vista, and West Hollywood
Coachella Valley Housing Coalition
Community Corporation of Santa Monica
Community Health Improvement Partners
Community Housing Improvement Program
Community Housing Opportunities Corporation
Community Housing Works
Community Working Group
Contra Costa Health Services
Corporation for Supportive Housing
Counties of Alameda, Contra Costa, and San Francisco
Curtom-Dunsmuir
Dignity Health
DMB Pacific Ventures
Domus Development
Drug Policy Alliance
Duncan Group
EAH Housing
East Bay Developmental Disabilities Legislative Coalition
East Bay Housing Organizations
East LA Community Corporation
Ecumenical Council Pasadena Area Congregations
Eden Housing
Enterprise Community Partners
Environmental Health Coalition
Episcopal Community Services of San Francisco
First Place for Youth
Foundation for Affordable Housing
Fullerton Chamber of Commerce
Gonzalez Goodale Architects
Habitat for Humanity California
Habitat for Humanity East Bay/Silicon Valley
Habitat for Humanity Greater San Francisco
Habitat for Humanity Inland Valley
Habitat for Humanity Pomona Valley
Habitat for Humanity Riverside
Habitat for Humanity San Gabriel Valley
Habitat for Humanity San Luis Obispo County
Habitat for Humanity Santa Cruz County
Hamilton Family Center
Highridge Costa Housing Partners
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Hollywood Community Housing Corporation
Home Builders Association of Tulare/Kings Counties
Home Start
Homes for Life Foundation
Housing Authority for the City of San Buenaventura
Housing Choices Coalition for People with Developmental
Disabilities
Housing Leadership Council of San Mateo County
Housing Works
ICON Builders
InnerCity Struggle
Integrity Housing
Interfaith Community Services
International Association for Women of Color Day
Jamboree Housing Corporation
John Stewart Company
Kennedy Commission
L.A. Family Housing
LA Voice
LA Works
Larkin Street Youth Services
Laurin Associates
Lauterbach and Associates
Law Foundation of Silicon Valley
Leading Age California
League of California Cities
League of Women Voters of California
LeSar Development Consultants
LifeSTEPS
LINC Housing
Little Tokyo Service Center
Loaves and Fishes
Local Initiatives Support Corporation
Los Angeles Area Chamber of Commerce
Los Angeles Business Council
Los Angeles Business Leaders Task Force on Homelessness
Los Angeles Community Action Network
Los Angeles Regional Reentry Partnership
Lutheran Office of Public Policy
Mammoth Lakes Housing
Marin Workforce Housing Trust
Mental Health America of Los Angeles
Mental Health Systems
Mercy Housing
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MidPen Housing Corporation
Move LA
Multicultural Communities for Mobility
Mutual Housing California
Nancy Lewis Associates
National Community Renaissance
National Council of La Raza
National Housing Law Project
Natural Resources Defense Council
Neighborhood Housing Services of Los Angeles County
Neighborhood Partnership Housing Services
NeighborWorks Orange County
Nevada/California Indian Housing Association
New Directions
Non-Profit Housing Association of Northern California
Northern California Community Loan Fund
Northern Circle Indian Housing Authority
Opportune Companies
Orange County Business Council
Orange County Housing Trust
Pacific Clinics
Palm Communities
Partner Energy
Pasadena Police Department
Pasadena Public Health Department
Peace Officers Research Association of California
Peninsula Interfaith Action
Penny Lane Centers
People Assisting the Homeless
Peoples' Self-Help Housing Corporation
PICO California
PMG
PolicyLink
Public Advocates
Related California
Resources for Community Development
Ruiz Brothers Construction Co.
Rural Communities Housing Development Corporation
Rural Community Assistance Corporation
Sacramento Homeless Organizing Committee
Sacramento Housing Alliance
San Benito County Housing and Economic Development Department
San Diego Community Land Trust
San Diego Regional Chamber of Commerce
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San Gabriel Valley Consortium on Homelessness
San Gabriel Valley Council of Governments
San Luis Obispo County Housing Trust Fund
Self-Help Enterprises
Service Employees International Union (SEIU) California State
Council
Sierra Business Council
Sierra Club California
Silicon Valley Bank
Silicon Valley Leadership Group
Skid Row Housing Trust
Sonoma County Task Force for the Homeless
Southeast Asian Community Alliance
Southern California Association of Non-Profit Housing
SPUR
SRO Housing Corporation
St. Joseph Center
St. Joseph Health
St. Paul's Senior Home and Services
Stand Up for Neighborly Novato
State Building and Construction Trades Council of California
State Independent Living Council
Step Up on Second
Sun Country Builders
Sunseri Construction
Supervisor Mark Ridley-Thomas, Los Angeles County
T.R.U.S.T. South LA
TELACU Residential Management, Inc.
Tenderloin Neighborhood Development Corporation
Thai Community Development Center
The Arc
The KTGY Group
Thomas Safran and Associates
Turning Point Community Programs
United Cerebral Palsy in California
United Homeless Healthcare Partners
United States Veterans Initiative
United Way of Fresno County
United Way of Greater Los Angeles
United Ways of California
Valley Economic Development Center
Venice Community Housing Corporation
Veterans of Foreign Wars of the U.S. Greater El Monte Post
Visionary Home Builders
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Wakeland Housing and Development Corporation
Walton Construction Services
Ward Economic Development Corporation
West Angeles Community Development Corporation
Western Center on Law and Poverty
Westport Construction
Women Organizing Resources, Knowledge, and Services
OPPOSITION : (Verified 5/23/13)
Board of Equalization Member George Runner
Board of Equalization Member Michelle Steel
Butte County Clerk-Recorder
Calaveras County Clerk-Recorder
California Association of Legal Document Assistants
California Association of Realtors
California Credit Union League
California Document Preparers
California Escrow Association
California Land Surveyors Association
California Land Title Association
California Taxpayers Association
Cities of Camarillo, Cypress, and Waterford
Colusa County Clerk Recorder
Counties of Butte, Colusa, Lassen, Mono, Orange, San Luis
Obispo, and Sierra
County Recorders' Association of California
El Dorado County Recorder-Clerk
Hamman Real Estate
Inyo County Clerk Recorder
Kern County Assessor-Recorder
Marin County Assessor-Recorder-Clerk
Nevada County Clerk-Recorder
Orange County Clerk-Recorder
Plumas County Clerk
Riverside County Assessor-County Clerk-Recorder
San Bernardino County Recorder-Clerk
San Luis Obispo County Clerk-Recorder
Santa Barbara County Clerk, Recorder and Assessor
Sierra County Clerk-Recorder
Sonoma County Clerk-Recorder-Assessor
Stanislaus County Clerk-Recorder
Western Mining Alliance
Yolo County Clerk-Recorder
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ARGUMENTS IN SUPPORT : According to the author's office,
everyone in California needs a safe and affordable place to call
home. For United States military veterans, former foster youth,
families with children, people with disabilities, seniors on
fixed incomes, and other vulnerable Californians, however, the
housing crisis is not over. Millions of Californians are caught
in the "perfect storm" - mortgages remain out of reach, credit
standards have tightened, and the foreclosure crisis has pushed
more people into a rental market already suffering from decades
of short supply - leading to record-setting rent increases. The
most vulnerable, who struggled to make rent before the
foreclosure crisis, face even more uncertainty in today's rental
housing market. They risk joining the more than 130,000
Californians who are homeless on any given night.
Moreover, rents and mortgages within the reach of working
families are critical to maintaining California's business
competitiveness. Numerous business groups say California needs
to increase the supply of housing options affordable to workers
so companies can compete for the talent that drives California's
economy.
At the same time, California's investment in affordable homes
has dried up. State agencies have awarded nearly all of the
voter-approved bond funding for affordable housing. Likewise,
the elimination of redevelopment agencies has cut off funding
from the low- and moderate-income housing set aside.
The Act begins to restore California's historic investments in
affordable homes by creating an ongoing, pay-as-you-go source of
funding dedicated to affordable housing development.
ARGUMENTS IN OPPOSITION : The Orange County Board of
Supervisors states that the proposed fee has no relation to
affordable housing and places additional financial burdens on
ordinary Californians. The County Recorders Association of
California and its members point out that some recordings or
transactions involve more than one document, in which case the
per-document fee will add to the already substantial cost of
recording. In addition, county recorders will encounter
significant increases in staff time to collect fees and address
unsatisfied customers.
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JA:k 5/23/13 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
**** END ****
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