BILL ANALYSIS Ó SENATE COMMITTEE ON VETERANS AFFAIRS Senator Jim Nielsen, Chair 2015 - 2016 Regular Bill No: SB 384 Hearing Date: 4/14/15 ----------------------------------------------------------------- |Author: |Leyva | |-----------+-----------------------------------------------------| |Version: |2/24/15 | ----------------------------------------------------------------- ----------------------------------------------------------------- |Urgency: |No |Fiscal: |Yes | ----------------------------------------------------------------- ----------------------------------------------------------------- |Consultant:|Wade Teasdale | | | | ----------------------------------------------------------------- Subject: Veteran housing: multifamily units: underserved veterans DESCRIPTION Summary: To help meet the specific housing needs of underserved veterans, this bill sets aside a percentage of any state funds being used to acquire, construct, rehabilitate or preserve multifamily housing units for veterans, in general. Existing law: 1. Provides for various programs and bond issuances to provide housing for veterans. 2. Includes the Veterans Housing and Homeless Prevention Act of 2014, (VHHP), which provides for the acquisition, construction, rehabilitation, and preservation of affordable multifamily supportive housing, affordable transitional housing, affordable rental housing, or related facilities for veterans and their families. This bill: 1. For all multifamily housing units acquired, constructed, rehabilitated, or preserved on or after January 1, 2016, for the purpose of housing veterans, a percentage of the state funds to be used shall be reserved to provide housing for underserved veterans. 2. Requires the California Department of Veterans Affairs SB 384 (Leyva) Page 2 of ? (CalVet) to determine the functional definition of "underserved veterans" based on the needs of veterans at the time funding is awarded. 3. Requires CalVet, in consultation with the appropriate local agencies, to determine the percentage of housing funds set aside for underserved veterans. BACKGROUND State Housing Programs - General Housing Programs - General In most years, about 150,000 houses and apartments are built in California. Most of these housing units are built entirely with private dollars. Some, however, receive financial help from federal, state, or local governments. For example, the state provides local governments, nonprofits, and private developers with low-cost loans to fund a portion of the housing units' construction costs. Typically, housing built with these funds must be sold or rented to Californians with low incomes. A portion of housing units built with state funds is set aside for homeless Californians. These include homeless shelters, short-term housing, and supportive housing. A January 2013 federal government survey identified 137,000 homeless Californians, including about 15,000 veterans. (Source: LAO Analysis, Proposition 41, June 2014 statewide ballot pamphlet). Supportive housing is permanent rental housing linked to a range of onsite or offsite support services, including mental and physical health care, drug and alcohol abuse counseling, and job training programs, designed to enable residents to maintain stable lives. There is no limit on length of stay. Transitional housing is a type of supportive housing used to facilitate the movement of homeless individuals and families to permanent housing. A homeless person may live in a transitional apartment for a specified period of time, while receiving supportive services that enable independent living. These are buildings configured and operated as rental housing developments, but are operated under program requirements that call for the termination of assistance and recirculation of the SB 384 (Leyva) Page 3 of ? housing unit to another eligible program participant at some predetermined future point in time - which shall be no less than six months and often capped at two years. The intent is to provide extended shelter and supportive services for homeless individuals and/or families with the goal of helping them live independently and transition into permanent housing. A relatively recent innovation in serving homeless populations, "Housing First" provides an alternative to progressive systems based on the emergency shelter/transitional housing model. Rather than moving homeless individuals or households through different "levels" of housing and eventually to "independent housing," the Housing First approach immediately moves the homeless from the streets or shelters into their own apartments. Veterans' nontraditional housing needs According to a federal agency report to the Congress: A veteran is 50 percent more likely to be homeless than a non-veteran. Although only eight percent of adults in the United States are veterans, federal surveys suggest that veterans represent up to 16 percent of America's homeless population. Rates of homelessness among veterans living in poverty are particularly high for veterans identifying as Hispanic/Latino (1:4) or African-American (1:4). Two groups of homeless veterans - women and people between ages 18 and 30 - are small in number. However, female veterans and young veterans are at high risk of becoming homeless, and both groups are growing within the overall veteran population. According to major point-in-time survey, nearly half of homeless veterans on a given night were located in four states: California, Florida, Texas, and New York. Only 28 percent of all veterans were located in those same four states. (Source: "Veteran Homelessness: A Supplemental Report to the 2009 Annual Homeless Assessment Report to Congress," U.S. Dept of Housing and Urban Development/U.S. Department SB 384 (Leyva) Page 4 of ? of Veterans Affairs.) In reviewing AB 639 (J. Pérez, 2013), the Assembly Committee on Housing and Development observed: Despite California's high number of homeless veterans, the state does not have any programs that are directly targeted at serving this population, or at serving lower-income veterans who are at risk of homelessness. HCD offers various programs that support the development of multifamily rental housing for low income Californians, including supportive and transitional housing, but none are veteran-specific. AB 639 (J. Pérez, 2013) became Proposition 41 on the June 2014 statewide ballot and received voter approval. In enacting the VHHP, the measure authorizes issuance of $600 million in general obligation bonds to fund the acquisition, construction, rehabilitation, and preservation of multifamily supportive housing, affordable transitional housing, affordable rental housing, and related facilities for veterans and their families. The law requires CalVet, the Department of Housing and Community Development (HCD), and California Housing Finance Agency (CHFA) to jointly design the program, which then will be implemented by HCD. Affordable housing developers then partner with veterans service providers to build affordable housing dwellings, including supportive housing, which will provide housing and services to veterans who are homeless or who have extremely low income to assist the veterans to achieve housing stability and improve self-sufficiency. In February 2015, HCD adopted its initial program guidelines and issued a notice of funds available. Per the Legislative Analyst, Proposition 41 provides: Housing for Low-Income Veterans : - Funds construction, renovation, and acquisition of affordable multifamily housing, such as apartment complexes. - Provides local governments, nonprofit organizations, SB 384 (Leyva) Page 5 of ? and private developers with financial assistance, such as low-interest loans, to fund part of a project's costs. - Housing built with these funds would be rented to low-income veterans and their families -those who earn less than 80 percent of average family income, as adjusted by family size and county. (For example, the average statewide amount for a single person to be considered low-income for this program is about $38,000. State law requires these units to be affordable, meaning rent payments made by veterans cannot exceed 30 percent of the income limit for the program.) Housing for Homeless Veterans : - Gives funding priority to projects that would house homeless veterans and veterans who are at risk of becoming homeless. - In particular, at least one-half of the funds would be used to construct housing for extremely low-income veterans. These veterans earn less than 30 percent of the amount earned by the average family in the county where they live. (The average statewide amount for a single person to be considered extremely low-income is about $14,000.) A portion of the funding for extremely low-income veterans would be used to build supportive housing for homeless veterans. Federal Housing Assistance/Supportive Services for Veterans The U.S. Department of Housing and Urban Development (HUD) partners with the U.S. Department of Veterans Affairs' (USDVA) Supportive Housing Program to manage the HUD-VASH program, which serves the most vulnerable veterans, and provides special services for women veterans, those recently returning from combat zones, and veterans with disabilities. As of September 30, 2013, HUD had allocated more than 58,000 Housing Choice vouchers across the country, which allows veterans and their families to live in market-rate rental housing, while receiving USDVA-provided case management for clinical and supportive services. A housing subsidy is paid to the landlord directly by the local public housing authority on SB 384 (Leyva) Page 6 of ? behalf of the participating veteran. The veteran then pays the difference between the actual rent charged by the landlord and the amount subsidized by the program. COMMENT 1.Committee Staff Comments : a) This bill adds §980.7 to the Military and Veterans Code (MVC) and would apply to "all multifamily housing units acquired, constructed, rehabilitated, or preserved on or after January 1, 2016, for the purpose of housing veterans." The scope of this proposed language would include, but likely extend beyond the VHHP Act enacted via Proposition 41 (2014). b) The Prop 41 program is still in its infancy. In mid-February 2015, HCD adopted implementing regulations, including the application process and selection criteria. Shortly thereafter, HCD published a Notice of Funding Availability announcing that $75 million was available for applications to be filed by April 27, 2015. c) Although Proposition 41 and the HCD regulations address the needs of low-income and homeless veterans, neither mentions "underserved veterans" nor provides any language helpful to program analysts in determining which demographic cohorts of veterans may be underserved. d) Suggested Amendments for Consideration 1) Per the author's office, the intent is that CalVet and local agencies collaborate in identifying the inadequately met needs of discrete populations of "underserved veterans" as they vary by community. The author might consider amending subdivision (b) of the proposed MVC §980.7 to make it consistent with the collaboration requirement contained in subdivision (a): (b) For purposes of this section, "underserved veterans" shall have the meaning determined by the department, in consultation with the SB 384 (Leyva) Page 7 of ? appropriate local agencies, based on the needs of veterans at the time funding is awarded. 2) In addition, the term "underserved" should be defined more functionally so that it includes one or more criteria, which may be applied by CalVet and local agencies in analyzing a given community's veteran demographics and the unique, unmet housing needs of local veterans. 1.Related Legislation SB 689 (Huff, pending Senate Vet Affairs, 2015 ): Regarding the Veterans Housing and Homelessness Prevention Act, this bill requires prioritization given to applications for proposed housing projects that would maintain a qualified mental health professional, as defined, on staff or on contract for services. AB 639 (J. Pérez, Ch. 727, Stats. 2013 ): Establishes the Veterans Housing and Homeless Prevention Bond Act of 2014, which authorizes issuance of $600 million in general obligation (GO) bonds to fund the acquisition, construction, rehabilitation, and preservation of multifamily supportive housing, affordable transitional housing, affordable rental housing, and related facilities for veterans and their families, if approved by the voters at the June, 2014, statewide election. (As Proposition 41, the measure was approved by the voters 65.4% to 34.6%.) POSITIONS Sponsor: Author Support: American Legion - Department of CA AMVETS - Department of CA CA Association of County Veterans Service Officers (CACVSO) CA State Commanders Veteran Council Military Officers Association of America - CA Council of Chapters Veterans of Foreign Wars - Department of CA Vietnam Veterans of American - CA State Council SB 384 (Leyva) Page 8 of ? Oppose: None on file -- END --