Assembly Speaker Toni Atkins unveiled a series of legislative proposals Wednesday from Assembly Democrats designed to boost funding for affordable housing and help address the state’s housing crisis.
The centerpiece of the package announced by the San Diego Democrat was a plan to establish a permanent source of funding for affordable housing through a $75 fee on real-estate transaction documents, excluding home sales.
The proposal is similar to one that failed in the Legislature’s last session in the face of opposition from Realtor groups.
An Atkins representative said the new legislation has a clearer list of eligible uses for the funds and would cap the fee at $225 per parcel.
To address concerns that the funds would not be protected, there is language in the legislation that says the fee cannot be collected if it is to be used for any other purpose than is in the act.
The bill needs to win a two-thirds vote in both chambers for passage.
It was previously estimated the $75 fee could generate anywhere between $300 million and $750 million annually.
“The permanent funding source, which earned overwhelming support from California’s business community, will generate hundreds of millions annually for affordable housing and leverage billions of dollars more in federal, local and bank investment,” Atkins said at a press conference in Los Angeles.
Bruce Reznick, executive director of the San Diego Housing Federation, said his organization strongly supports the proposal as an ongoing funding source for affordable housing.
He said the funds will help make up for the loss of millions of dollars for affordable housing that occurred when redevelopment agencies were dissolved statewide in 2012.
The loss of redevelopment funds, in addition to the spending down of bond funding and other cuts, has reduced affordable-housing funding in the San Diego region by about $122 million annually, he said.
“If we can bring back some of that money through this measure, that will be a huge dent in the affordable-housing crisis throughout San Diego and California,” Reznick said.
Atkins and other Assembly Democrats also seek to increase the annual amount of state Low-Income Housing Tax Credits available by $300 million.
The statute presently provides a ceiling of $70 million. Because of increases for inflation, returned credits and other factors, $103 million was available in 2014.
The speaker said the demand for the credits exceeds their availability, and making more money available will help the state receive more federal tax credits.
Reznick said the state has left millions of federal dollars on the table by not providing more state and local support for affordable housing.
Atkins and Assembly Democrats are also pushing for legislation that would create a framework for how California would spend money from the National Housing Trust Fund that states are expected to start receiving in 2016.
The speaker also wants to use from $50 million to $80 million in savings from Proposition 47 to invest in rapid re-housing and housing supports for Californians released from prison.
The proposal regarding Proposition 47, the approved ballot measure that reduced many nonviolent property and drug crimes from felonies to misdemeanors, would require a two-thirds vote by both chambers.
“We have a housing crisis in California and it's time we offered bold suggestions and solutions,” Atkins said.
Reznick said his organization would work to generate support in the San Diego area for the proposals, which he said could help address the shortage of 130,000 affordable homes in the county.
“This package the speaker is putting forward could really get us back on track to build the number of affordable homes in the region that we need,” he said.
The bills unveiled by Atkins also drew strong support from State Treasurer John Chiang, chair of the state’s Tax Credit Allocation Committee.
“The speaker's housing proposals will increase the financing available to build truly affordable units,” said Chiang, who attended Wednesday's press conference. “As treasurer, I will do everything within my power to make sure that financing is accessible and is used to put roofs over the heads of California's working families.”
Chiang recently announced he is leading a six-month effort to provide a detailed analysis of the root causes of why the state has 13 of the 14 least affordable metropolitan housing markets in the nation.
The treasurer expects to present a first round of solutions this year.