BILL ANALYSIS Ó
SB 1413
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Date of Hearing: June 22, 2016
ASSEMBLY COMMITTEE ON EDUCATION
Patrick O'Donnell, Chair
SB
1413 (Leno) - As Amended June 16, 2016
[Note: This bill was double-referred to the Assembly Committee
on Housing and Community Development and was heard by that
committee as it relates to issues under its jurisdiction.]
SENATE VOTE: 29-7
SUBJECT: School districts: employee housing
SUMMARY: Establishes the Teacher Housing Act of 2016 to
facilitate the acquisition, constriction, rehabilitation, and
preservation of affordable housing restricted to teachers or
school district employees. Specifically, this bill:
1)Makes findings and declarations regarding the importance of
providing affordable housing for teachers and other school
employees to help address staffing shortages.
2)Defines "affordable rental housing" to mean a rental housing
development where a majority of the rents are restricted to
levels affordable to low- and moderate income residents, no
more than 120% of area median income (AMI), and are not
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limited to projects with five or more units.
3)Defines "teacher or school district employee" to mean any
person employed by a unified school district maintaining
prekindergarten, transitional kindergarten, and grades 1 to
12, elementary school district maintaining prekindergarten,
transitional kindergarten, and grades 1 to 8 or a high school
district maintaining grants 9 to 12 but not limited to
certified and classified staff.
4)Authorizes a school district to establish and implement
programs that address the housing needs of teachers and school
district employees who face challenges in securing affordable
housing.
5)Allows a school district, to the extent feasible, to establish
and implement programs that among other things, do the
following:
a) Leverage federal, state, and local public, private,
nonprofit and fiscal resources available to housing
developers;
b) Promote public and private partnerships; and
c) Foster innovated financing opportunities.
6)Creates a specific state policy supporting housing for
teachers and school district employees, as described in
Section 42(g) (9) (B) of the Internal Revenue Code, and
further permits school districts and developers in receipt of
local or state funds or tax credits designated for affordable
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rental housing to restrict occupancy to teachers and school
district employees on land owned by school districts so loans
as the housing does not violate any other applicable laws.
EXISTING LAW:
1)Federal law requires low-income housing tax credits (LIHTCs)
to be utilized for residential units that are for use by the
"general public." If a residential unit is provided only for
a member of a social organization or provided by an employer
for its employees, the unit is not for use by the general
public and not eligible for federal LIHTCs, and by extension,
state LIHTCs. A qualified low-income project does not fail to
meet the general-public use requirement solely because of
occupancy restrictions or preferences that favor, among other
things: members of a specified group under a federal program
or state program or policy that supports housing for a
specified group.
2)Defines "rental housing development" as a structure or set of
structures with common financing, ownership, and management,
and which collectively contain five or more dwelling units,
including efficiency units. No more than one of the dwelling
units may be occupied as a primary residence by a person or
household who is the owner of the structure or structures.
3)Establishes various housing programs, such as the Multifamily
Housing Program and Joe Serna Jr. Farmworker Housing Grant
Program administered by the Department of Housing and
Community Development (HCD) and the Low-Income Housing Tax
Credit (LIHTC) Program administered by the Tax Credit
Allocation Committee (TCAC) within the State Treasurer's
Office, to help low-income families and other specified
groups.
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4)Declares it unlawful, pursuant to Fair Employment and Housing
Act, for any housing accommodation owner to inquire about;
make known any preference or limitation as to; discriminate;
or harass a person based on the person's race, color,
religion, sex, gender, gender identity, gender expression,
sexual orientation, marital status, national origin, ancestry,
familial status, source of income, disability, or genetic
information (Government Code Section 12955).
5)Prohibits, under the Unruh Civil Rights Act, business
establishments from discriminating on the basis of sex
(including gender), race, color, religion, ancestry, national
origin, disability, medical condition, genetic information,
marital status, or sexual orientation, and provides civil
remedies for violations of its provisions (Civil Code Section
51 et seq.).
FISCAL EFFECT: According to the Senate Appropriations
Committee, to the extent this bill results in additional
affordable housing projects targeting teachers and school
personnel, greater demand would be placed on limited existing
housing resources leading to greater competition for receiving
certain financial benefits such as state low-income housing tax
credits. According to the State Treasurer's Office, state
credits are oversubscribed by roughly a 2 to 1 ratio.
COMMENTS:
Background: According to the author, at least two school
districts have successfully built affordable rental housing on
district owned property to house teachers employed in the
district. However, the districts only provide an occupancy
preference to teachers and cannot limit the housing to teachers
only. This bill would allow school districts to establish and
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implement programs to address the housing needs of teachers and
school district employees. In addition the bill creates a state
policy supporting housing for teachers and school employees, and
permits school districts and developers who receive local or
state funds or tax credits to support the construction of
affordable rental housing, to restrict the occupancy to teachers
and school district employees on land owned by school districts.
Generally under federal IRS rules, if a residential unit is
provided only for a member of a social organization or provided
by an employer for its employees, the unit is not for use by the
general public and is not eligible for federal LIHTC. However,
federal IRS law also states that a qualified LIHTC project does
not fail to meet the general public use requirement solely
because of occupancy restrictions or preferences that favor
tenants (1) with special needs, (2) who are members of a
specified group under a federal program or state program or
policy that supports housing for such a specified group, or (3)
who are involved in artistic or literary activities. This bill
creates a specific state policy that supports housing for
teachers and school district employees with the intent of making
it clear that those projects can receive LIHTC.
Purpose of this bill: According to the author, California places
a high value on its public education system, and the stability
of housing for school employees is critical to the overall
success and stability of each school in California. Students
and the community at large are benefitted by teachers living in
the community in which they practice their profession. It
ensures stability, community involvement, and stronger ties
between teachers, and their students and families. Lack of
affordable housing creates barriers to effective teaching and
teacher retention and the combination of teacher and housing
shortages demands innovative solutions. Twenty-five percent of
teachers nationwide point to housing incentives as an important
factor in their decision to return to teaching.
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While there are programs in many communities to help people find
and attain affordable housing, middle-class earners like
teachers do not always qualify for them. This bill underscores
the critical role that teachers and other education
professionals play in the long-term success of our state by
allowing for the development of specific housing to keep these
hard-working professionals in our communities and our schools.
This bill provides clear authorization to school districts to
develop housing on district-owned property, which will enable
the districts facing the most acute teacher shortages to
directly address the lack of affordable housing that is forcing
teachers out of our communities and out of a vital profession.
Investors require clear state law before getting on board with
new and innovative projects, especially in an area as expensive
as San Francisco. Unlike the higher education code, which
covers faculty housing in detail, K-12's silence on this issue
is a cause for great concern for financial markets when facing a
decision of whether to embark upon multi-billion dollar housing
projects."
REGISTERED SUPPORT / OPPOSITION:
Support
City and County of San Francisco
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Opposition
None received.
Analysis Prepared by:Rick Pratt / ED. / (916)
319-2087