BILL ANALYSIS
AB 1129
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Date of Hearing: August 13, 2008
ASSEMBLY COMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT
Lori Saldana, Chair
AB 1129 (Arambula) - As Amended: July 1, 2008
SUBJECT : Local Housing Trust Fund Matching Grant Program
SUMMARY : Reduces the minimum grant amount a newly established
housing trust fund that represents a county with a population of
less than 425,000 can receive from the Local Housing Trust Fund
Matching Grant Program (Program), administered by the Department
of Housing & Community Development (HCD), from $1,000,000 to
$500,000. Specifically, this bill :
1)Reduces the minimum Program grant a newly established local
housing trust fund representing a county with a population of
less than 425,000 people can receive from $1,000,000 to
$500,000.
2)Requires a newly established trust fund to provide adequate
documentation as determined by HCD that an ordinance or tax
imposing or dedicating a tax or fee to match the grant has
been enacted or that the applicant has adopted a legally
binding commitment that the matching funds will be deposited
once the application is approved.
3)Provides that in determining whether or not a county has a
population of less than 425,000, HCD must use the United
States Census for 2000.
EXISTING LAW allocates $35 million of the $100 million
Affordable Housing Innovation Fund from Proposition 1C to the
Program. Requires that half of the funds are to be made
available for newly established housing trusts. Requires HCD to
grant preference to trust funds that agree to expend more than
65% of the state funds for downpayment assistance to first time
homebuyers, and requires HCD, when making grants to newly
established trust funds, to set aside funding for 36 months from
the date the funds are first made available for newly
established trust funds in counties of less than 425,000
persons.
FISCAL EFFECT : According to the Senate Appropriations
Committee, pursuant to Senate Rule 28.8, negligible state costs.
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COMMENTS : In 2002, California voters approved Proposition 46,
the $2.1 billion Housing and Emergency Shelter Trust Fund Act.
Proposition 46 provided funding for the following programs:
Multifamily Housing Program; Emergency Housing Assistance
Program; Supportive Housing; Farmworker Housing Grant Program;
CalHome Program; Local Housing Trusts; Code Enforcement Program;
California Homebuyer Downpayment Assistance Program; and, Jobs
Housing Improvement Account. Funds provided under Proposition
46 were mostly exhausted by the end of 2006.
In November 2006, California voters approved Proposition 1C, the
Housing and Emergency Trust Fund Act of 2006. Proposition 1C
maintains funding provided under Proposition 46 for most, but
not all, of the programs noted above. One of the programs not
included in Proposition 1C was funding for local housing trusts.
Proposition 1C did include however, $100 million for the
Affordable Housing Innovation Fund to be used for "competitive
grants or loans to sponsoring entities that develop, own, lend,
or invest in affordable housing and used to create pilot
programs to demonstrate innovative, cost-saving approaches to
creating or preserving affordable housing."
In 2007, the case was successfully made that local housing trust
funds are inherently innovative, that is local housing leaders
can design individualized local programs to address affordable
housing needs in their communities. Therefore, $35 million was
made available for local housing trust funds to apply for
grants. One-half of the $35 million is to be made available
strictly for new trusts. Additionally, when awarding grants to
new trusts, HCD is required to set aside funding for a period of
36 months for trusts in counties with a population of less than
425,000.
According to the author, in order to take advantage of the
funding for housing trusts funds authorized in Proposition IC,
the San Joaquin Valley Housing Trust (SJV Housing Trust) was
established in 2008, with membership from counties and cities
throughout the eight county regions. A number of those counties
are small, rural areas with fewer local resources for planning
and developing affordable housing. Several of those counties
plan to establish their own housing trusts. According to the
author, housing trusts that may be established in smaller rural
counties such as those that are members of the SJV Housing Trust
face disadvantages in winning state grants. Those disadvantages
AB 1129
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include difficulties in raising local funding to match grants,
dollar for dollar, and obtaining those local funds prior to the
award of a state grant.
AB 1129 seeks to allow smaller, rural county housing trusts to
better compete for state housings trust fund grants by lowering
the minimum grant amount for newly established small county
trusts. Under the Program, local housing trust funds receive a
dollar for dollar match for their locally raised dollars of up
to a minimum of $1,000,000 and a maximum of $2,000,000. This
bill would reduce the minimum amount a local housing trust fund
in a county with a population of less than 425,000 to $500,000.
Existing housing trust funds are required to provide proof as
part of the application that the matching funds have been
deposited in the local housing trust fund and the identify of
the source of the matching funds. At the time of application,
newly established housing trust funds may not have the matching
funds deposited in their trust fund account; however HCD needs
some assurance that the local agency has taken steps to identify
and collect the matching funds. AB 1129 requires newly formed
housing trust funds to provide adequate documentation that a
local jurisdiction has adopted an ordinance imposing a tax or
fee dedicated to the matching funds that will be deposited in
the account once the application has been approved.
This bill was substantially amended in the Senate and the
Assembly-approved provisions of this bill were deleted. The
contents of this bill have not been heard by an Assembly policy
committee this session.
REGISTERED SUPPORT / OPPOSITION :
Support
Affordable Housing Collaborative
California Coalition for Rural Housing
Council of Fresno County Governments
Housing California
Self-Help Enterprises
Supervisor Deidre Kelsey, District Four, Merced County
The Housing Trust of Santa Clara County
Opposition
AB 1129
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None of file
Analysis Prepared by : Lisa Engel / H. & C.D. / (916) 319-2085