BILL ANALYSIS                                                                                                                                                                                                    






                      SENATE COMMITTEE ON VETERANS AFFAIRS
                             JEFF DENHAM, CHAIRMAN
                                             


          Bill No:        AB 1330
          Author:         Salas
          Version:        As amended May 5, 2009
          Hearing Date:   June 23, 2009
          Fiscal:         Yes
          Consultant:     Donald E. Wilson




                                 SUBJECT OF BILL  
          Pilot project - veterans' cooperative housing.  
           
                                   PROPOSED LAW  
          Allow money authorized for the Cal-Vet Home Loan Program to  
          be used to fund a pilot program for cooperative housing. 

                           EXISTING LAW AND BACKGROUND  
             1.   In 1921 the legislature authorized the Farm and  
               Home Loan Purchase Program commonly known as the  
               Cal-Vet Home Loan.

             2.   Home under this program includes farms and single  
               family dwellings.

             3.   California voters have authorized new funding for  
               this program over 20 times.

             4.   The most recent authorization SB 1752 (Wyland) of  
               2008 was approved by voters in 2008.

             5.   The latest authorization was needed because for the  
               first time in a generation the Federal Government  
               reauthorized the program for post Vietnam veterans.

             6.   The new authorization was enough money for roughly  
               3,000 home loans.

                                     COMMENT  
             1.   The Cal Vet Home Loan Program has been the most  
               successful and tangible benefit historically that the  









               state has provided to its veterans.

             2.   Some co-op housing is considered single-family,  
               which calls into question the need for this  
               legislation.

             3.   According to the author's office, CDVA has said it  
               needs clarification of the law before the department  
               can act on single family dwellings within co-op  
               housing.

             4.   This bill leaves implementation of the rules and  
               regulations to the department.

             5.   It is unclear whether or not the Federal Government  
               would allow Cal-Vet Bonds to be used in some types -or  
               any type- of co-op housing.

             6.   If a buyer defaults, what is the market for co-op  
               housing?  Will CDVA be stuck holding properties it  
               cannot resell?

             7.   If a group of veterans enters a co-op and buys most  
               or all of it, what happens if the co-op goes bankrupt?

             8.   The question is if CDVA already has the  
               authorization to do this why is it reticent to do so?   
               If there is a legal question with federal regulations,  
               this bill will not help.  If it is because co-ops are  
               viewed as bad risk loans or hard to resell, then the  
               committee needs to ask itself if in these times  
               whether or not the legislature should push CDVA in  
               this direction.


                                     SUPPORT  
          None received

                                      OPPOSE  
          None received




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