BILL ANALYSIS
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|SENATE RULES COMMITTEE | SB 251|
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CONSENT
Bill No: SB 251
Author: Senate Transportation and Housing Committee
Amended: 3/31/09
Vote: 21
SENATE TRANSPORTATION & HOUSING COMM : 10-0, 4/14/09
AYES: Lowenthal, Huff, Ashburn, DeSaulnier, Harman,
Hollingsworth, Kehoe, Pavley, Simitian, Wolk
NO VOTE RECORDED: Oropeza
SUBJECT : 2009 housing omnibus bill
SOURCE : Author
DIGEST : This bill makes non-controversial changes to
sections of law relating to housing.
ANALYSIS : This bill includes the following provisions:
1.Clarifying the timeline for HCD to review a COG's RHNA
allocation plan . [Section 1] Under current housing
element law, councils of governments (COGs) allocate the
regional housing need assessment (RHNA) among cities and
counties within their respective regions. The Department
of Housing and Community Development (HCD) has 60 days
from the date of adoption by a COG to review a RHNA plan.
The law does not require the COGs to submit their
adopted plans in a timely manner, however. On a number
of occasions, HCD has received a plan for review very
close to the end of the 60-day period, leaving very
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little time for a thorough review to be conducted within
the statutory timeframe. The proposed amendment requires
COG to immediately transmit its RHNA plan to HCD upon
adoption and gives HCD 60 days from the date an adopted
RHNA plan is received from a COG to review the plan for
consistency with applicable law.
2.Conversion of community apartments and stock
cooperatives . [Section 2] The Subdivision Map Act
currently contains exemptions for certain conversions of
community apartments and cooperatives to condominiums.
Under these exemptions, at least 75 percent of the units
in a community apartment project must have been occupied
by record owners of the project on March 31, 1982, and at
least 51 percent of the units in a stock cooperative must
have been occupied by stockholders of the corporation on
January 1, 1981. It can be very difficult to prove owner
occupancy from that long ago, and at times it is
impossible because the records are simply no longer
available. The bill alters the exemptions by replacing
the requirements to show owner occupancy with
requirements to show that no single owner controlled more
than 49% of the units on the relevant date. The bill
also makes technical changes to the statute.
3.Correct a drafting error relating to the strapping of
water heaters in manufactured housing . [Section 3] AB
2050 (Garcia), Chapter 737, Statutes of 2008, requires
that all fuel-gas-burning water heaters in mobilehomes
and manufactured homes be seismically braced, anchored,
or strapped. The language of the bill assumes that each
owner will "complete the work" when, in fact, subsequent
owners will rely on work done previously if proper. The
bill deletes the reference to "complet[ing] the work" and
instead relies solely on current law's requirement that
the homeowner or contract sign a declaration that the
water heater is secured as required.
4.Local Housing Trust Fund Program . [Section 3.5] Under
the Local Housing Trust Fund Matching Grant (LHTF)
Program, HCD matches, up to a certain level,
contributions of non-housing funds to a housing trust
fund created by a local government or non-profit
organization. Proposition 1C allocated $100 million to
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the Affordable Housing Innovation Fund (AHIF), and SB 586
(Dutton), Chapter 652, Statutes of 2007, later allocated
$35 million of AHIF funds to the LHTF Program. SB 586
further required that HCD set aside some level of funding
for a period of 36 months from the date funds are first
made available for newly established housing trust funds
in counties with populations of less than 425,000
persons. The bond itself, however, required that any
funds in the AHIF not encumbered within 30 months roll
over to HCD's CalHome Program, making it legally
impossible for HCD to meet the 36-month setaside
requirement for small counties. The proposed amendment
allows HCD to encumber funds set aside for newly
established housing trust funds up to 42 months from
availability and to make disbursements of such funds up
to 48 months from availability. Thereafter, unused funds
would revert to the CalHome Program. The 42-month
expenditure period gives HCD six months to review
applications, issue award letters, and prepare contracts
after the final date for accepting applications.
Assuming an LHTF were given an award letter at the end of
the proposed 42 month encumbrance deadline, the 48- month
liquidation deadline would give an award recipient six
months to confirm projects for which HCD would issue
warrants for the funds.
5.Correct a drafting error related to Chapter 8 tax sales .
[Section 4] Current law allows for the direct sale of a
non-owner occupied tax delinquent property to a
non-profit organization for the purpose of providing
affordable housing to low-income families. The law
requires that the housing thereafter be affordable for at
least 30 years or subject to a subsidy recapture and
equity sharing restriction. The law defines the subsidy
to be recaptured as the fair market value minus the sale
price to the low-income family but mistakenly refers to
the fair market value of the home at the time it was
purchased by the non-profit, as opposed to the time it
was purchased by the low-income owner occupant. The bill
corrects this mistake by referring to the fair market
value at the time of sale to the low-income owner
occupant.
6.Correct a cross reference relating to low-income housing
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tax credits . [Sections 5, 6, and 7] SB 585 (Lowenthal),
Chapter 382, Statutes of 2008, allows for the bifurcation
of state and federal low-income housing tax credits. SB
1247 (Lowenthal), Chapter 521, Statutes of 2008, moves
the farmworker housing tax credit program into the
low-income housing tax credit program as a farmworker
setaside. Because farmworker credits, unlike standard
state low-income housing credits, are not necessarily
coupled with federal low-income housing credits, language
was inserted into both bills that prohibits the
bifurcation of farmworker credits unless they are coupled
with federal low-income housing credits. This
prohibition is in the Revenue and Taxation Code, but
where the language cross-references the farmworker
setaside, it fails to recognize that the setaside is in
the Health and Safety Code. The bill correctly refers to
the farmworker setaside in the Health and Safety Code.
Comments
The Senate Transportation and Housing Committee is
authoring this bill as a means of combining multiple,
non-controversial changes to statutes into one bill, so
that the Legislature can make minor amendments in a
cost-effective manner. There is no known opposition to any
item in the bill, and if concerns arise that cannot be
resolved, the provision of concern will be deleted from the
bill.
FISCAL EFFECT : Appropriation: No Fiscal Com.: No
Local: No
JA:nl 4/16/09 Senate Floor Analyses
SUPPORT/OPPOSITION: NONE RECEIVED
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