BILL ANALYSIS
AB 1129
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 1129 (Arambula)
As Amended July 1, 2008
Majority vote
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|ASSEMBLY: | |(January 24, |SENATE: |36-3 |(August 7, |
| | |2008) | | |2008) |
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(vote not relevant)
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|COMMITTEE VOTE: |4-1 |(August 13, 2008) |RECOMMENDATION: |concur |
| | | | | |
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Original Committee Reference: H. & C.D.
SUMMARY : Reduces the minimum grant a newly established housing
trust fund representing a county with a population of less than
425,000 people can receive from $1 million to $500,000.
The Senate amendments delete the Assembly version of the bill, and
instead:
1)Reduce 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 million to
$500,000.
2)Require newly established trust funds to provide adequate
documentation as determined by HCD that the trust will provide
matching funds on approval of its application.
3)Provide 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
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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.
AS PASSED BY THE ASSEMBLY , this bill allowed for the creation of
the San Joaquin Valley Regional Affordable Housing Trust (Trust).
Specifically, this bill :
1)Provided findings and declarations with regard to the projected
substantial population growth and the need for affordable housing
in the San Joaquin Valley.
2)Provided that it is the intent of the Legislature to establish
the Trust to assist communities in securing and distributing
affordable housing funds.
3)Established the Trust for the purposes of administering federal,
state, local and private resources for the development of
affordable housing. Additionally, the Trust seeks to foster
regional collaboration among local governments, developers,
financial and community organizations to meet area affordable
housing needs.
4)Required the Trust do all of the following:
a) Establish a governing board which may include, but is not
limited to one member from each participating council of
government in the San Joaquin Valley (the San Joaquin Valley
include the Counties of Kern, Kings, Tulare, Fresno, Madera,
Merced, Stanislaus, and San Joaquin), three from the
California Partnership for the San Joaquin Valley, one
affordable housing advocacy organization, one nonprofit
affordable housing developer, and one housing industry
representative;
b) Develop a region-wide strategy consistent with the San
Joaquin Regional Blueprint (Regional Blueprint);
c) Raise funds from federal, state, local and private
organizations;
d) Establish a revolving loan account for funding affordable
housing in the jurisdictions of the trust members. Make loans
to entities seeking to build affordable housing. Require
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loans to be contingent on showing that the project is
consistent with: housing element; Regional Blueprint; all
environmental approvals; development permits; and, local
financial commitment;
e) Develop criteria for project selection to include:
increased density; mixed income; infill; fair share
allocation; transit oriented development; and, proximity to
employment;
f) Require local public contributions;
g) Establish loan repayment terms;
h) Develop performance standards;
i) Provide technical assistance to members;
j) Assist in forming partnerships for affordable housing
demonstration projects;
aa) Prepare any required reports or other documentation;
bb) Develop a regional education campaign that promotes higher
density, mixed use, transit oriented development;
cc) Make recommendations to the Legislature and Governor to
eliminate obstacles to affordable housing; and,
dd) Report to the Business, Transportation and Housing Agency
as well as HCD on the activities of the Trust.
5)Required the governing board to adopt a set of bylaws.
6)Allowed up to 5% of trust assets to be used for administrative
costs.
7)Provided the governing board with authority to approve grant
applications as well as loan conditions.
FISCAL EFFECT : According to the Senate Appropriations Committee,
pursuant to Senate Rule 28.8, negligible state costs.
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:
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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 trusts
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 trusts 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.
This bill 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.
Need for the bill: 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
include difficulties in raising local funding to match grants,
dollar for dollar, and obtaining those local funds prior to the
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award of a state grant.
As passed by the Senate, this bill lowers the minimum grant amount
for newly established small county trusts in counties with less
than 425,000 people and changes the way those trusts identify the
commitment of local matching funds. The bill also specifies the
population benchmark for defining a small county trust at less than
425,000 people.
Analysis Prepared by : Lisa Engel / H. & C.D. / (916) 319-2085
FN: 0006895