BILL NUMBER: AB 702 AMENDED
BILL TEXT
AMENDED IN SENATE JUNE 22, 2010
AMENDED IN ASSEMBLY JUNE 1, 2009
AMENDED IN ASSEMBLY APRIL 20, 2009
INTRODUCED BY Assembly Member Salas
FEBRUARY 26, 2009
An act to amend Section 50802 of the Health and Safety
Code, An act to amend Section 50517.5 of the Health
and Safety Code, relating to housing and community development.
LEGISLATIVE COUNSEL'S DIGEST
AB 702, as amended, Salas. Emergency Housing and
Assistance Fund. Joe Serna, Jr. Farmworker Housing
Grant Program: agricultural employees.
Existing law establishes the Joe Serna, Jr. Farmworker Housing
Grant Program, administered by the Department of Housing and
Community Development, under which, subject to the availability of
funds, grants or loans, or both, are made available for the
construction or rehabilitation of housing for agricultural employees,
as defined, and their families or for the acquisition of
manufactured housing to remedy the impacts of the displacement of
farmworker families.
This bill would modify the definition for the term "agricultural
employees."
Existing law creates within the State Treasury the Emergency
Housing and Assistance Fund, a continuously appropriated fund, to
carry out the purposes of the Emergency Housing and Assistance
Program. Existing law requires the Department of Housing and
Community Development to ensure that not less than 20% of the moneys
in the fund be allocated to nonurban counties during any given fiscal
year.
This bill would also require the department to ensure that a
certain percentage of the moneys in the fund be allocated to sponsors
of veterans only homeless projects or projects that give preference
to veterans during any given fiscal year. The bill would require that
funds not utilized to their full capacity during the fiscal year be
allocated in that fiscal year for general distribution in accordance
with the intent and purposes of the program.
Vote: majority. Appropriation: no. Fiscal committee: yes
no . State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 50517.5 of the
Health and Safety Code is amended to read:
50517.5. (a) (1) The department shall establish the Joe Serna,
Jr. Farmworker Housing Grant Program under which, subject to the
availability of funds therefor, grants or loans, or both, shall be
made to local public entities, nonprofit corporations, limited
liability companies, and limited partnerships, for the construction
or rehabilitation of housing for agricultural employees and their
families or for the acquisition of manufactured housing as part of a
program to address and remedy the impacts of current and potential
displacement of farmworker families from existing labor camps,
mobilehome parks, or other housing. Under this program, grants or
loans, or both, may also be made for the cost of acquiring the land
and any building thereon in connection with housing assisted pursuant
to this section and for the construction and rehabilitation of
related support facilities necessary to the housing. In its
administration of this program, the department shall disburse grants
or loans, or both, to the local public entities, nonprofit
corporations, limited liability companies, or limited partnerships or
may, at the request of the local public entity, nonprofit
corporation, limited liability company, or limited partnership that
sponsors and supervises the rehabilitation or construction program,
disburse grant funds to agricultural employees who are participants
in a rehabilitation or construction program sponsored and supervised
by the local public entity, nonprofit corporation, limited liability
company, or limited partnership. No part of a grant or loan made
pursuant to this section may be used for project organization or
planning.
(2) Notwithstanding any other provision of this chapter, upon the
request of a grantee the program also may loan funds to a grantee at
no more than 3 percent simple interest. Principal and accumulated
interest is due and payable upon completion of the term of the loan.
For any loan made pursuant to this subdivision, the performance
requirements of the lien shall remain in effect for a period of no
less than the original term of the loan.
(3) The program shall be administered by the Director of Housing
and Community Development and officers and employees of the
department as he or she may designate.
(b) (1) The Joe Serna, Jr. Farmworker Housing Grant Fund is hereby
created in the State Treasury. Notwithstanding Section 13340 of the
Government Code, all money in the fund is continuously appropriated
to the department for making grants or loans, or both, pursuant to
this section and Section 50517.10, for purposes of Chapter 8.5
(commencing with Section 50710), and for costs incurred by the
department in administering these programs.
(2) There shall be paid into the fund the following:
(A) Any moneys appropriated and made available by the Legislature
for purposes of the fund.
(B) Any moneys that the department receives in repayment or return
of grants or loans from the fund, including any interest therefrom.
(C) Any other moneys that may be made available to the department
for the purposes of this chapter from any other source or sources.
(D) All moneys appropriated to the department for the purposes of
Chapter 8.5 (commencing with Section 50710) and any moneys received
by the department from the occupants of housing or shelter provided
pursuant to Chapter 8.5 (commencing with Section 50710). These moneys
shall be separately accounted for from the other moneys deposited in
the fund.
(c) (1) Grants and loans made pursuant to this section shall be
matched by grantees with at least equal amounts of federal moneys,
other cash investments, or in-kind contributions.
(2) For grant or loan requests of not more than five hundred
thousand dollars ($500,000), the department may waive a part of the
matching fund requirement in this subdivision if the grantee
demonstrates an inability, as may be established by the department in
"Notices of Funding Availability," to secure adequate financing from
other sources. Not more than 5 percent of the total amount
appropriated to the department for the purposes of this section may
be used to meet grant or loan requests in which a part of the
matching fund requirement has been waived pursuant to this paragraph.
(d) With respect to the supervision of grantees, the department
shall do the following:
(1) Establish minimum capital reserves to be maintained by
grantees.
(2) Fix and alter from time to time a schedule of rents that may
be necessary to provide residents of housing assisted pursuant to
this section with affordable rents to the extent consistent with the
maintenance of the financial integrity of the housing project. No
grantee shall increase the rent on any unit constructed or
rehabilitated with the assistance of funds provided pursuant to this
section without the prior permission of the department, which shall
be given only if the grantee affirmatively demonstrates that the
increase is required to defray necessary operating costs or avoid
jeopardizing the fiscal integrity of the housing project.
(3) Determine standards for, and control selection by grantees of,
tenants and subsequent purchasers of housing constructed or
rehabilitated with the assistance of funds provided pursuant to this
section.
(4) (A) Require as a condition precedent to a grant or loan, or
both, of funds that the applicant have site control that is
satisfactory to the department; that the grantee be record owner in
fee of the assisted real property or provide other security including
a lien on the manufactured home that is satisfactory to the
department to ensure compliance with the construction, financial, and
program obligations; and that the grantee shall have entered into a
written agreement with the department binding upon the grantee and
successors in interest to the grantee. The agreement shall include
the conditions under which the funds advanced may be repaid. The
agreement shall include provisions for a lien on the assisted real
property or manufactured home in favor of the State of California for
the purpose of securing performance of the agreement. The agreement
shall also provide that the lien shall endure until released by the
Director of Housing and Community Development.
(B) If funds granted or loaned pursuant to this section constitute
less than 25 percent of the total development cost or value,
whichever is applicable, of a project assisted under this section,
the department may adopt, by regulation, criteria for determining the
number of units in a project to which the restrictions on occupancy
contained in the agreement apply. In no event may these regulations
provide for the application of the agreement to a percentage of units
in a project that is less than the percentage of total development
costs that funds granted or loaned pursuant to this section
represent.
(C) Contemporaneously with the disbursement of the initial funds
to a grantee, the department shall cause to be recorded, in the
office of the county recorder of the county in which the assisted
real property is located, a notice of lien executed by the Director
of Housing and Community Development. The notice of lien shall refer
to the agreement required by this paragraph for which it secures and
it shall include a legal description of the assisted real property
that is subject to the lien. The notice of lien shall be indexed by
the recorder in the Grantor Index to the name of the grantee and in
the Grantee Index to the name of the State of California, Department
of Housing and Community Development. For manufactured housing, the
liens shall be recorded by the department in the same manner as other
manufactured housing liens are recorded. The department shall adopt
by regulation criteria for the determination of the lien period. This
regulation shall take into account whether the property is held by
multifamily rental, single-family ownership, or cooperative ownership
and whether it is new construction or rehabilitative construction.
The lien period for manufactured housing liens for manufactured homes
shall not exceed 10 years.
(D) Pursuant to regulations adopted by the department, the
department may execute and cause to be recorded in the office of the
recorder of the county in which a notice of lien has been recorded,
or the department, as appropriate, a subordination of the lien. The
regulations adopted by the department shall provide that any
subordination of the lien shall not jeopardize the security interest
of the state and shall further the interest of farmworker housing.
The recitals contained in the subordination shall be conclusive in
favor of any bona fide purchaser or lender relying thereon.
(E) Prior to funds granted pursuant to this section being used to
finance the acquisition of a manufactured home, the grantee shall
ensure that the home either is already installed in a location where
it will be occupied by the eligible household or that a location has
been leased or otherwise made available for the manufactured home to
be occupied by the eligible household.
(5) Regulate the terms of occupancy agreements or resale controls,
to be used in housing assisted pursuant to this section.
(6) Provide linguistically appropriate services and publications,
or require grantees to do so, as necessary to implement the purposes
of this section.
(7) The agreement between the department and the grantee shall
provide, among other things, that both of the following occur:
(A) Upon the sale or conveyance of the real property, or any part
thereof, for use other than for agricultural employee occupancy, the
grantee or its successors shall, as a condition for the release of
the lien provided pursuant to paragraph (4), repay to the fund the
department's grant and loan funds.
(B) Upon the sale or conveyance of the real property or any part
thereof for continued agricultural employee occupancy, the transferee
shall assume the obligation of the transferor and the real property
shall be transferred to the new owner; provided that the transferee
agrees to abide by the agreement entered into between the transferor
and the department and that the new owner takes the property subject
to the lien provided pursuant to paragraph (4), except that this lien
shall, at the time of the transfer of the property to the new owner,
be extended for an additional lien period determined by the
department pursuant to paragraph (4), and the new owner shall not be
credited with the lien period that had run from the time the
transferor had acquired the property to the time of transfer to the
new owner, unless the department determines that it is in the best
interest of the state and consistent with the intent of this section
to so credit the lien period to the new owner. However, the lien
shall have priority as of the recording date of the lien for the
original grantee, pursuant to paragraph (4).
(e) The department may do any of the following with respect to
grantees:
(1) Through its agents or employees enter upon and inspect the
lands, buildings, and equipment of a grantee, including books and
records, at any time before, during, or after construction or
rehabilitation of units assisted pursuant to this section. However,
there shall be no entry or inspection of any unit that is occupied,
whether or not any occupant is actually present, without the consent
of the occupant.
(2) Supervise the operation and maintenance of any housing
assisted pursuant to this section and order repairs as may be
necessary to protect the public interest or the health, safety, or
welfare of occupants of the housing.
(f) The department shall include in its annual report required by
Section 50408, a current report of the Joe Serna, Jr. Farmworker
Housing Grant Program. The report shall include, but need not be
limited to, (1) the number of households assisted, (2) the average
income of households assisted and the distribution of annual incomes
among assisted households, (3) the rents paid by households assisted,
(4) the number and amount of grants or loans, or both, made to each
grantee in the preceding year, (5) the dollar value of funding
derived from sources other than the state for each project receiving
a grant or loan, or both, under this section, and an identification
of each source, (6) recommendations, as needed, to improve operations
of the program and respecting the desirability of extending its
application to other groups in rural areas identified by the
department as having special need for state housing assistance, and
(7) the number of manufactured housing units assisted under this
section.
(g) As used in this section:
(1) "Agricultural employee" has the same meaning as specified in
subdivision (b) of Section 1140.4 of the Labor Code, but also
includes any person who works at a packing shed for a labor
contractor or other entity that contracts with an agricultural
employer in order to perform services on or off the farm
in connection with handling, drying, packing, processing,
or storing any agricultural commodity in its raw or natural
state , whether or not this person is encompassed within
the definition specified in subdivision (b) of Section 1140.4 of the
Labor Code.
(2) "Grantee" means the local public entity, nonprofit
corporation, limited liability company, or limited partnership that
is awarded the grant or loan, or both, under this section, and, at
the request thereof, may include an agricultural employee receiving
direct payment of a grant for rehabilitation under this section who
occupies the assisted housing both before and after the
rehabilitation and may include an agricultural employee receiving
direct payment of a grant for construction under this section who
will occupy the assisted housing and who is a participant in a
rehabilitation or construction program sponsored and supervised by a
local public entity, nonprofit corporation, limited liability
company, or limited partnership.
(3) "Housing" may include, but is not necessarily limited to,
conventionally constructed units and manufactured housing installed
pursuant to either Section 18551 or 18613.
(4) "Limited liability company" means a limited liability company
where all the members are nonprofit public benefit corporations.
(5) "Limited partnership" means a limited partnership where all of
the general partners are either nonprofit public benefit
corporations, limited liability companies, or a combination of
nonprofit public benefit corporations and limited liability
companies.
(h) The department may provide the assistance offered pursuant to
this chapter in any area where there is a substantial unmet need for
farmworker housing.
SECTION 1. Section 50802 of the Health and
Safety Code is amended to read:
50802. (a) The department shall ensure that not less than 20
percent of the moneys in the Emergency Housing and Assistance Fund
shall be allocated to nonurban counties during any given fiscal year.
If the funds designated for facilities operation that are allocated
to nonurban counties are not awarded by the end of that fiscal year,
then those unencumbered funds shall be allocated in the next fiscal
year to urban counties. Funds for capital development that are not
awarded by the end of the second fiscal year shall be awarded in the
subsequent fiscal year to urban counties.
(b) The amount of funds that the department allocates from the
Emergency Housing and Assistance Fund to each region, excluding funds
allocated pursuant to subdivision (a), shall be based upon a formula
that accords at least 20 percent weight to each of the following
factors:
(1) The relative number of persons in the region below the poverty
line according to the most recent federal census, updated, if
possible, with an estimate by the Department of Finance, compared to
the total of the urban counties.
(2) The relative number of persons unemployed within each region,
based on the most recent one-year period for which data is available,
compared to the total of the urban counties.
(c) Grant funds shall be disbursed as expeditiously as possible by
the department.
(d) The department shall use not more than 5 percent of the amount
available for funds pursuant to this chapter to defray the
department's administrative costs pursuant to this chapter.
(e) Notwithstanding any other provision of this chapter, the
department shall distribute funds appropriated for purposes of the
activities specified in paragraph (2) of subdivision (a) of Section
50803 as grants in the form of forgivable deferred loans, subject to
all of the following:
(1) Funding shall be made available to each project as a loan with
a term of five years for rehabilitation, seven years for substantial
rehabilitation, or 10 years for acquisition and rehabilitation or
new construction. Each deferred loan shall be secured by a deed of
trust and promissory note. Repayment of the loan shall be deferred as
long as the project is used as an emergency shelter or transitional
housing. At the completion of the specified year term, the loan shall
be forgiven. If a transfer or conveyance of the project property,
however, occurs prior to that time that results in the property no
longer being used as an emergency shelter or transitional housing,
the department shall terminate the grant and require the repayment of
the deferred loan in full.
(2) Applications for funding shall be made pursuant to
department-issued statewide "Notices of Funding Availability" without
the need for additional regulations.
(3) The department shall set forth the criteria for evaluating
applications in the "Notices of Funding Availability" and shall make
deferred loans based on those applications that best meet the
criteria.
(4) The department shall specify in the "Notice of Funding
Availability" both maximum and minimum grant amounts that may be
varied for urban and nonurban counties.
(5) Contracts for projects that have not begun construction within
the initial 12-month period shall be terminated and funds
reallocated. The department, however, may extend this period by a
period not to exceed 12 months.
(f) (1) The department shall ensure that a percentage of the
moneys in the Emergency Housing and Assistance Fund be allocated to
sponsors of veterans only homeless projects or projects that give
preference to veterans during any given fiscal year. The department
shall use the percentage calculated pursuant to paragraph (2).
(2) The department, in conjunction with the Department of Veterans
Affairs, shall use existing data to annually determine the
percentage of veterans within the homeless population.
(3) If the funds designated pursuant to paragraph (1) are not
utilized to their full capacity during the fiscal year, then those
unencumbered funds shall be allocated in that fiscal year for general
distribution in accordance with the intent and purposes of this
chapter.