BILL ANALYSIS                                                                                                                                                                                                    Ó





          SENATE COMMITTEE ON APPROPRIATIONS
                             Senator Ricardo Lara, Chair
                            2015 - 2016  Regular  Session

          SB 384 (Leyva) - Veteran housing:  multifamily units:   
          underserved veterans
          
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          |Version: January 6, 2016        |Policy Vote: V.A. 5 - 0, T. &   |
          |                                |          H. 9 - 0              |
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          |Urgency: No                     |Mandate: No                     |
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          |Hearing Date: January 19, 2016  |Consultant: Mark McKenzie       |
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          This bill meets the criteria for referral to the Suspense File.







          Bill  
          Summary:  SB 384 would require that a percentage of state bond  
          funds allocated annually for purposes of the Veterans Housing  
          and Homeless Prevention (VHHP) Act of 2014 be reserved for  
          housing underserved veterans.  The Department of Veterans  
          Affairs (CalVet) to annually determine the percentage of  
          reserved funds in consultation with appropriate local agencies,  
          beginning July 1, 2017.









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          Fiscal  
          Impact:  
           Estimated CalVet costs of approximately $206,000 annually for  
            two PY of staff to establish the program, annually determine  
            the underserved veteran population, consult with local  
            agencies, and determine the percentage to reserve for these  
            purposes. (Housing for Veterans Fund) 

           Unknown costs to the Department of Housing and Community  
            Development (HCD) and the California Housing Finance Agency  
            (CalHFA), likely less than $50,000, to revise existing VHHP  
            guidelines. (Housing for Veterans Fund)

           Potential delays in the allocation of VHHP bond revenues for  
            projects that qualify for funding under the current program  
            guidelines.  This would occur when there are insufficient  
            applicants to fully allocate reserved funds, in which case the  
            funds would revert back to the Housing for Veterans Fund for  
            other authorized VHHP purposes. 


          Background:  Existing law, the Veterans Housing and Homeless Prevention  
          Bond Act of 2014 (approved by the voters at Proposition 41 in  
          June of 2014), authorizes the issuance of $600 million in  
          general obligation bonds to provide multifamily housing to  
          veterans.  The VHHP requires CalHFA, HCD, and CalVet to  
          establish and implement a program that focuses on veterans at  
          risk of homelessness or experiencing temporary or chronic  
          homelessness.  The program funds 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 to allow veterans to access and maintain housing  
          stability.  The VHHP Act specifies that up to five percent of  
          bond funds may be used for administrative purposes.

          Existing law requires the administering departments to establish  
          and implement programs that focus on veterans at risk of  
          homelessness or experiencing temporary or chronic homelessness,  
          and do the following: 
           Leverage public, private, and nonprofit funding sources.
           Prioritize projects that combine housing and supportive  
            services, as specified.
           Promote public and private partnerships.







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           Foster innovative financing opportunities
           Ensure that program guidelines and terms provide requirements  
            or scoring criteria to advance applicants that combine  
            permanent and/or transitional housing with supportive services  
            for veterans, or for partnering with developers or service  
            providers with experience offering housing or services to  
            veterans.
          The administering departments must also ensure that at least 50  
          percent of funds awarded for capital development be used to  
          provide housing to veteran households with extremely low  
          incomes.  The VHHP Act provides flexibility for the  
          administering departments to review, adopt, amend, and repeal  
          guidelines or terms related to the program.

          HCD adopted initial VHHP program guidelines in February 2015,  
          and has issued two rounds of funding to date.  


          Proposed Law:  
            SB 384 would require that a percentage of VHHP funds be  
          reserved each year for housing "underserved veterans."   
          Specifically, this bill would:
           Define "underserved veterans" as those veterans either  
            experiencing or at risk of experiencing homelessness at a  
            disproportionate rate to their veteran or nonveteran  
            counterparts, as determined by the most recent federal Annual  
            Homeless Assessment Report (AHAR) that includes an assessment  
            of veteran homelessness.
           Require a percentage of state funds used for housing veterans  
            in multifamily housing units pursuant to the VHHP to be  
            reserved for housing underserved veterans.
           Require CalVet to determine the percentage of funds to be  
            reserved annually, beginning July 1, 2017, in consultation  
            with appropriate local agencies using the most recently  
            released AHAR, or other similar source CalVet deems  
            appropriate. 
           Require reserved funding to revert to the Housing for Veterans  
            Fund if there are insufficient applications for proposed  
            housing projects intended for underserved veterans.  The funds  
            would then be made available for other VHHP purposes.




          Related  







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          Legislation:  
          AB 639 (Perez), Chap 727/2013, established the VHHP and  
          authorizes the issuance of $600 million in general obligation  
          bonds to be used for housing homeless and low-income veterans,  
          upon approval by the voters.
          SB 689 (Huff), which is currently in the Senate Transportation  
          and Housing Committee,  requires state agencies to prioritize  
          projects under the VHHP that, for the purposes of providing  
          mental health and drug services, either: 1) accept only  
          residents that are prequalified to receive services from the  
          U.S. Department of Veterans Affairs (VA), or 2) if they accept  
          residents who receive services from agencies other than the VA,  
          employ on staff or contract for a qualified mental health  
          professional with at least two years' full-time relevant  
          experience providing services to veterans.  

          AB 253 (Hernandez), which is currently in the Senate  
          Transportation and Housing Committee, requires state agencies to  
          give a preference to applicants for funding under the VHHP that  
          demonstrate a multiyear commitment of Mental Health Services Act  
          Funding for the applicant's project funding plan.  


          Staff  
          Comments:  SB 384 is intended to ensure that sufficient funding  
          is set aside each year to address the needs of underserved  
          vulnerable populations of veterans.  The bill provides broad  
          discretion to CalVet to determine the amount of funding needed  
          each year, based upon a specified federal report or any similar  
          document it deems appropriate.  Staff notes that there does not  
          appear to be provisions of the current VHHP law that would  
          preclude a project specifically designed to assist underserved  
          veterans from receiving an allocation of funding.  In addition,  
          the administering entities have not received any applications  
          for such a project in the initial rounds of funding.
          CalVet indicates that it would require an additional two  
          positions of staff, at an annual cost of approximately $206,000,  
          to set up the program specific to underserved veterans, conduct  
          annual outreach and coordination to determine the underserved  
          populations, and establish a percentage of reserved funding each  
          year.  Current law allows up to five percent of bond revenues to  
          be used for administrative purposes.  Staff assumes these new  
          positions could be funded from bond proceeds.









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