BILL ANALYSIS �
AB 1951
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 1951 (Atkins)
As Amended August 21, 2012
Majority vote
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|ASSEMBLY: |52-26|(May 30, 2012) |SENATE: |24-12|(August 22, |
| | | | | |2012) |
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Original Committee Reference: H. & C.D.
SUMMARY : Transfers $30 million from the Affordable Housing
Innovation Fund to the Multifamily Housing Program (MHP).
The Senate amendments:
1)Appropriate the funds in the Housing Rehabilitation Loan Fund
for the MHP.
2)Require the Department of Housing and Community Development
(HCD) to issue a Notice of Funding Availability (NOFA) for
MHP.
3)Requires the NOFA to specify that HCD shall consider persons
with development disabilities, including autism and homeless,
veterans, as special needs populations for the propose of
granting bonus points to affordable housing developments.
AS PASSED BY THE ASSEMBLY , this bill deleted two programs, the
Practitioner Fund and the Construction Liability Insurance
Reform Pilot Program, that are part of the Affordable Housing
Innovation Fund created by Proposition 1C: Housing and
Emergency Shelter Trust Fund Act of 2006 (Proposition 1C).
Specifically, this bill:
1)Deleted the Practitioner Fund administered by the HCD and the
$25 million appropriated to that fund.
2)Deleted the Construction Liability Insurance Reform Pilot
Program administered by HCD and the $5 million appropriated to
that program.
3)Required HCD to make $30 million available from the Affordable
Housing Innovation Fund for the MHP.
AB 1951
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4)Deleted the requirement that HCD provide a comparison of the
cost of creating or preserving units funded by the
Practitioner Fund and the Affordable Housing Revolving
Development and Acquisition Program in its annual report that
is due to the Legislature on or before December 31, 2013.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, redirects $30 million in voter-approved bond funds.
COMMENTS : Proposition 1C authorized the creation of the
Affordable Housing Innovation Fund and transferred $100 million
to the Fund. The bond required the funds to be expended for
competitive grants or loans to sponsoring entities that develop,
own, lend, or invest in affordable housing through pilot
programs that demonstrate innovate, cost-savings approaches to
creating or preserving affordable housing. The bond required
that these programs be created statutorily through two-third
vote bills. Any funds that were not spent within 30 months of
being offered through the programs would revert to the Self-Help
Housing Fund.
In 2007, SB 586 (Dutton), Chapter 652, created several new
programs funded by the Affordable Housing Innovation Fund
including the Practitioner Fund and the Construction Liability
Insurance Reform Pilot Program. The Practitioner Fund required
HCD to make loans to non-profit entities to purchase land for
affordable housing developments. Practitioners selected for the
program were required to have experience as a lender to
affordable housing developers and would have five years to spend
the funds. They would also be required to leverage the
Practitioner funds from non-state resources on a three to one
basis. HCD developed draft guidelines for this program but they
were not formalized and a Notice of Funding Availability (NOFA)
was not issued for the program.
The Construction Liability Insurance Reform Pilot Program was
created to promote best practices for residential construction,
quality control in affordable housing projects that receive
loans from the California Housing Finance Agency (CalHFA). HCD
has not developed guidelines for this program yet.
Proposition 1C also authorized $195 million for the MHP program
which funds the production or rehabilitation of affordable
rental housing. MHP is the most popular program offered by HCD
AB 1951
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and has been significantly oversubscribed in past years. There
is no money left in MHP.
Purpose of this bill: AB 1951 would collapse the Practitioner
Fund ($25 million) and the Construction Liability Insurance
Reform Pilot Program ($5 million) and roll the combined $30
million available to these two programs into MHP.
Proposition 1C authorized the creation of the Affordable Housing
Innovation Fund but required the Legislature develop programs to
spend the funds with some parameters. Bond funds are close to
exhausted and the likelihood of another bond measure to
replenish the coffers is limited. In addition, the dissolution
of redevelopment agencies eliminated the Low- and
Moderate-Income Housing Fund as a source of funding for
affordable housing. Unlike most other programs authorized by
Proposition 1C, the Affordable Housing Innovation Fund, required
legislative action to develop programs that met the parameters
outlined in the bond for this pot of money. With limited
resources available, the author supports moving funds into MHP
where they can make a greater impact in solving California's
ongoing housing crisis, while retaining the intent of the
voters.
The Senate amendments require HCD to grant bonus points to
affordable housing developments that serve the autistic and
homeless veterans when awarding funding through from the $30
million appropriated by this bill to MHP.
Analysis Prepared by : Lisa Engel / H. & C.D. / (916) 319-2085
FN: 0005374