BILL ANALYSIS
AB 702
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Date of Hearing: April 28, 2009
ASSEMBLY COMMITTEE ON VETERANS AFFAIRS
Mary Salas, Chair
AB 702 (Salas) - As Amended: April 20, 2009
SUBJECT : Emergency Housing and Assistance Fund.
SUMMARY : appropriate, for the 2009-10 fiscal year, $4,000,000
from the General Fund to the Emergency Housing and Assistance
Fund, as specified, for operating facilities and capital
development grants. The bill would prohibit grants funded
pursuant to the appropriation to be used to supplant existing
emergency shelter or transitional housing funding. The bill
would impose various limitations on the award amounts of
specified grants.
EXISTING LAW: states that under the Emergency Housing and
Assistance Program, the Department of Housing and Community
Development is authorized to make grants from the continuously
appropriated Emergency Housing and Assistance Fund to local
governments and nonprofit organizations to provide emergency or
transitional housing.
FISCAL EFFECT : $4,000,000 from the General Fund to the
Emergency Housing and Assistance Fund
COMMENTS : The Emergency Housing Assistance Program (EHAP)
provides facility operating grants for emergency shelters,
transitional housing projects, and supportive services for
homeless individuals and families.
Last year, the Governor proposed a budget balancing reduction
(BBR) of $401,000 resulting in a 10 percent reduction of state
contributions, estimated to be equivalent to 1,900 beds. The
Legislature chose to restore that cut through the budget
process. The Governor, however, vetoed the restored funding as
well as the entire state contribution to emergency housing
facilities (an additional $3.6 million cut). The state, prior
to last year, provided approximately 10 percent of the overall
funding for local homeless shelters. Based on the Department's
1,900 bed estimate for the original BBR, it would suggest 19,000
beds would be eliminated by the Governor's $4 million reduction.
The Governor supported his veto with his boiler plate veto
AB 702
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language stating: "While the budget bill provides for a modest
reserve in 2008-09, it fails to make the necessary statutory
spending reductions and revenue increases needed to eliminate
the state's structural budget deficit going forward. At the
same time, constitutional requirements, federal law and court
required payments drive the majority of the spending in any
budget, and limit my ability to reduce spending. As a result, I
have an obligation to reduce spending when my veto power is
adequate to do so. Consequently -- and in order to further
ensure that this budget remains in balance -- I am taking the
difficult but necessary action reflected in this veto to further
control state spending."
Housing California, an advocate for increasing the supply and
variety of decent, safe, and affordable homes for homeless and
low income families, conducted a survey of emergency shelters
throughout California, and based on responses received, they
estimate a much higher impact than the department. They
estimate:
1)Conservative estimates show that more than 25,000 fewer people
will be able to access emergency shelter services. These
numbers include hundreds of families and thousands of
children.
2)58 percent of recipients report the necessity to lay off
staff, resulting in further job losses and increased demand
for unemployment benefits.
3)California stands to lose millions more in federal funding, as
EHAP money was used by many as a match for federal resources.
In each instance, the loss of one $30,000 EHAP grant can
result in the loss of hundreds of thousands in federal dollars
for that organization.
4)Rural areas are being particularly hard hit, as the EHAP
grants received by rural counties generally account for larger
portions of their emergency shelter budgets.
5)Winter shelters are likely to be forced to close their doors
early or not open at all.
6)Nearly 20 percent of shelters will be forced to close a
program and two shelters report they may have to close
permanently.
AB 702
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7)Attempts to fill operating-revenue gaps, emergency shelters
are growing more dependent on less-reliable funding streams,
such as private donations and local government funds (both of
which are already tapped to the brink).
8)All areas of the state are affected -- at least one shelter in
every county lost funding.
Federal stimulus funds may be available to mitigate the impact
of this cut.
Updated information from the National Coalition for Homeless
Veterans states that 23% of homeless population are veterans.
That author feels that by re-authorizing the bond that we will
be putting funds on the street that will help veterans, because
they make up such a large portion of the population.
REGISTERED SUPPORT / OPPOSITION :
Support
California Association of Veteran Service Agencies
Western Center on Law and Poverty
Opposition
None on file.
Analysis Prepared by : Eric Worthen / V. A. / (916) 319-3550