Proposition 6 seeks to repeal the fuel tax approved by the Legislature in 2017. While proponents of the repeal measure argue that the tax will cost families an average of $700 in additional costs annually, a Sacramento Bee article suggests the true cost to California families would fall in the range of $238 to $334 per year. While these costs are not negligible, opponents argue that a No vote is necessary to addressing the backlog of transportation infrastructure needs over the next decade.
Currently, the gas tax will provide an estimated $52 billion over the next 10 years for infrastructure needs with approximately half of those funds going directly to cities and counties to address local needs. In San Diego, Proposition 6 funding is being used to widen Interstate 5, increase public transit, and resurface streets. In Los Angeles, funds are being used for a variety of active transportation projects, such as bike lanes and trails, pedestrian walkways, and ADA accommodations. Information on projects in other communities statewide can be found on the Rebuilding CA Project Map.
With more than 30 years of experience in the real estate development and investment banking industries, Jennifer LeSar brings a diverse background to her work in community development and urban revitalization. Her technical expertise spans from policy and program development to comprehensive strategic planning for top executives and executive teams to the origination and underwriting of complex investments in equity funds, multi-family portfolios, historic, and low-income tax credit properties utilizing federal and state financing programs. Ms. LeSar’s educational achievements include two advanced degrees from UCLA – a Master of Business Administration in Real Estate, Finance and Nonprofit Management and a Master of Arts in Urban Planning. She received her Bachelor of Arts from Bryn Mawr College in Political Science and Economics. She can be reached at email@example.com.
Comments Off on Legislature Extends Legacy of 2017 Housing Package
California lawmakers continued to build on the achievements of the 2017 housing package by passing a number of bills to address the ongoing housing crisis during the final days of the 2018 legislative session, which ended on Aug. 31. While issues related to land use planning, affordable housing development, fair housing efforts, and homelessness continued to figure prominently in the debate, the Legislature also passed a number of bills to mitigate risks associated with a second crisis: wildfire disasters. Governor Brown has until Sept. 30, 2018, to sign or veto the bills.
Land Use Planning
Both AB 1771 and SB 828, which are awaiting Governor Brown’s signature, would address ongoing concerns that the current Regional Housing Needs Allocation (RHNA) distribution process is more often influenced by politics rather than data on housing needs.
AB 1771, authored by Assm. Richard Bloom (D-Santa Monica), would substantively change the allocation process by requiring Councils of Government (COGs) to develop their RHNA allocation methodology in consultation with the state Department of Housing and Community Development (HCD) rather than waiting to consult with HCD until they are in the process of developing their allocation plans. The plans would need to integrate statutory objectives related to promoting infill development, advancing socioeconomic equity, achieving greenhouse gas targets, increasing the availability of affordable housing units relative to the number of low-wage jobs, and affirmatively furthering fair housing.
AB 1771 also calls for COGs to employ a more transparent approach to developing and implementing the allocation process. For example, COGs would also need to electronically publish the results of its survey of members on the proposed methodology and information on how the proposed methodology achieves statutory objectives. The methodology would need to address factors such as housing need, housing burden, overcrowding, and the availability of housing to align with employment and wages. HCD would have 60 days following the public comment period to determine whether the methodology meets RHNA allocation statutory objectives. Another change contained within the bill would prohibit local governments from proposing the redistribution of housing allocations among themselves as part of an appeal process.
SB 828, authored by Sen. Scott Wiener (D-San Francisco), seeks to establish a more transparent, equitable process for determining each jurisdiction’s Regional Housing Needs Assessment (RHNA). While each jurisdiction is required to plan for its fair share of the regional housing need, the current process does not adequately account for unmet needs due to historically low housing production. Further, the process has been criticized for favoring cities that can apply political pressure to reduce their allocations. SB 828 would allow HCD to include existing households in the number of total projected households when determining RHNA methodology. It would also prohibit COGs from using factors, such as the prior underproduction of housing or stable population numbers from the previous RHNA, in determining the jurisdiction’s future share of housing needs.
SB 828 would further require the final regional housing need allocation plan to demonstrate government efforts to reverse racial and wealth disparities throughout a region. Specifically, COGs would be required to compare local overcrowding and vacancy rates, as well as the percentage of cost-burdened households, with those of a healthy housing market. Before passing the bill, the Assembly cut language that would have required a city or county to identify an inventory of available land equal to 125 percent of its RHNA requirements for each income category or identify zoning and other strategies to address needs.
The Legislature also passed AB 829, which was authored by Assm. David Chiu (D-San Francisco) and designed to discourage local legislative bodies from requiring developers to obtain a letter of acknowledgement or other documentation prior to seeking state funding for a project in their district. Senate amendments refocused the bill’s language to prohibit the use of state funding in any project that requires documentation from a local legislative body or one of its members. The bill was introduced following a Los Angeles Times article on Los Angeles city councilmembers power to block housing developments in their district by requiring, but not providing, such documentation.
In addition, AB 2923, authored by Assms. David Chiu (D-San Francisco) and Timothy Grayson (D-Concord), would streamline the approval process for transit-oriented development (TOD) on infill sites owned by Bay Area Rapid Transit (BART) and located within a half-mile of a BART station. The bill would also require the BART Board of Directors to establish TOD zoning standards by July 1, 2020. Cities and counties within the BART service area would have two years or until July 1, 2022, to adopt an ordinance conforming to the BART TOD zoning standards. If signed into law, the bill would enable BART to fulfill its goal of building 20,000 new units of housing, including 7,000 units of affordable housing, on the 250 acres of developable land it owns by 2040.
Governor Brown has already signed, AB 3194, which updates the Housing Accountability Act to prohibit jurisdictions from rejecting a development of very low-income, low-income, or moderate-income housing or an emergency shelter without evidence to demonstrate that it would have a “specific, adverse impact upon the public health or safety.” Authored by Assemb. Tom Daly (D-Santa Ana), the law prohibits jurisdictions from requiring rezoning for projects that meet objective general plan standards when local zoning is inconsistent with the general plan.
The governor also signed AB 1406, which was authored by Assm. Todd Gloria (D-San Diego). The new law amends the Education Code to extend the allowable term of specific types of lease agreements entered into by a school district to 99 years and aligns the law with Civil Code. The Education Code had previously prevented school districts from entering a lease-leaseback agreement or lease-to-own agreement of more than 40 years with the entity that constructed the school facility. The maximum term under which school districts can co-locate with another entity through a joint-occupancy agreement has also been extended from 66 to 99 years.
Affordable Housing Development
Introduced by Sen. Ben Allen (D-Santa Monica) and co-authored by Assms. Jesse Gabriel (D-Van Nuys) and Lorena Gonzalez Fletcher (D-San Diego), SB 961 would streamline the process for developing affordable housing near transit in enhanced infrastructure financing districts (EIFDs) in certain situations. EIFDs are government entities established by cities or counties for the specific purpose of financing public and private infrastructure and facilities, including low- and moderate-income housing. This bill would enable EIFDs to enact and form a Second Neighborhood Infill Finance and Transit Improvement Act (NIFTI-2), which allows for the issuance of bond financing to support affordable housing near transit without voter approval.
SB 961 also sets forth procedures public financing authorities must follow to develop and adopt an infrastructure financing plan to expend NIIFTI-2 funds. Cities or counties would be allowed to allocate tax revenues to a NIFTI-2 by adopting a resolution, under certain conditions. Specifically, the district would be required to use at least 40 percent of the total funds it receives for rental or owner-occupied housing affordable to households earning 60 percent or less of the area median income (AMI). Rental housing funded through the EIFD would need to remain affordable for 55 years, and owner-occupied housing would have affordability restrictions for 45 years. Half of the total housing funds would be used to develop permanent supportive housing for people experiencing homelessness or households earning less than 30 percent AMI.
The bill was amended in the Assembly to require an EIFD to set aside at least 10 percent of its total funds to cover capital costs for greening efforts or active transportation capital projects. Other amendments established requirements for public hearings and guidelines to address potential landowner and resident protests of the financing plan.
Two other bills, intended to make it easier to build accessory dwelling units, did not make it through the Legislature. AB 2890, authored by Assm. Phil Ting (D-San Francisco), would have further revised Accessory Dwelling Unit laws to prohibit local ordinances from imposing certain standards that constrain ADU development and required HCD to establish small home building standards. SB 831, introduced by Sen. Bob Wieckowski (D-Fremont) and coauthored by Sens. Toni Atkins (D-San Diego), Nancy Skinner (D-Berkeley), and Scott Wiener, would have significantly rewritten ADU statutes. The bills did not pass at least in part because local governments have only updated local ADU ordinances to comply with recent laws, which went into effect less than two years ago.
The Legislature also took a proactive stance to ensure that all housing and community development programs combat patterns of discrimination and segregation by actively addressing disparities, promoting inclusive communities, and upholding civil rights and fair housing law regardless of whether they receive HUD funding.
Authored by Assm. Miguel Santiago (D-Los Angeles), AB 686 would require public agencies to be consistent with the final rule to Affirmatively Further Fair Housing, promulgated by the U.S. Department of Housing and Urban Development during the Obama Administration. This would require Housing Elements due on or after January 1, 2021, to include an assessment of fair housing with an analysis of fair housing issues and trends contributing to disparate access to housing; goals, strategies, and actions to address factors that contribute to limited housing choice and access to opportunity; metrics to track progress toward goals; and the identification of land suitable for residential development.
On August 28, Governor Brown signed AB 2219, authored by Assm. Phil Ting (D-San Francisco). This bill requires landlords to accept security deposits and rent from a third party in a form other than cash or electronic funds transfer. The third party must provide a signed acknowledgement that they are not the tenant. The new law seeks to prevent homelessness by requiring landlords to accept funds from individuals and/or organizations other than the tenant. The third-party payments do not constitute a contract between the landlord and third party, and the law does not prevent landlords from terminating a tenant rental agreement.
As part of ongoing efforts to address the public health impact and costs of homelessness, the Legislature passed bills to facilitate supportive housing development, support efforts to reduce youth homelessness, provide matching funds to support employment programs for people experiencing homelessness, and create the Orange County Housing Trust.
Jointly authored by Assms. David Chiu and Tom Daly, AB 2162 expedites supportive housing development by making it a by-right use in multifamily and mixed use zones under certain conditions. The bill would allow ministerial approval of projects that are 100 percent affordable for low-income households earning up to 80 percent of AMI if 25 percent or 15 of the units, whichever is greater, are set aside for supportive housing. Projects would be required to have a 55-year affordability restrictions, no minimum parking requirements for supportive housing units located within a half-mile of transit, and a plan for on-site supportive services with named partners, proposed funding sources, and staffing commitments. Senate amendments would cap by-right development requirements at 50 units or less in cities or unincorporated areas of a county with a population of less than 200,000 and an annual Point-In-Time count of less than 1,500, although a city or county could approve by-right development for projects of over 50 units. If signed by Governor Brown, the bill would apply to all areas even where local governments are meeting RHNA.
A second bill, SB 1152, authored by Sen. Ed Hernandez (D-Montebello), would require hospital discharge policies and procedures to include specific processes for discharging people experiencing homelessness to ensure that they are not discharged without having a safe place to go. The law would require hospitals to inquire about an individual’s housing status; notify patients about options for housing, shelter, and supportive services based on their best interest and preferences; and identify a post-discharge destination. Assembly amendments eliminate requirements related to coordinating referrals and providing transportation in excess of 30 minutes or 30 miles, and delay implementation until July 1, 2019. In addition, hospitals would be required to maintain a discharge log of patients experiencing homelessness rather than report to the Office of State Health Planning and Development.
The Legislature also passed SB 918, known as the Homeless Youth Act of 2018 and co-authored by Sen. Scott Wiener and Assm. Blanca Rubio (D-Baldwin Park), which would establish additional requirements for the Homeless Coordinating and Financing Council focused on the specific needs of youth experiencing homelessness. As of the January 2017 Point-In-Time Count, California was home to more than 15,000 homeless youth, 38 percent of the total homeless youth population nationwide. The requirements include setting goals and outcomes measures; enhancing systems integration and coordination; guiding the coordination of policy, practice, and funding in coordination with stakeholders; identifying best practices; and, providing program development and technical assistance, as funding is available. Assembly amendments eliminated a grant program focused on youth homelessness.
If signed into law, AB 3085, authored by Assm. Ian Calderon (D-Whittier), would establish the New Beginnings California Program within the Department of Community Services and Development. The program would provide up to $50,000 in matching funding for up to 50 cities or Continuum of Care (CoC) programs to pursue a homeless employment program of their own or expand on an existing one. Cities and CoCs would be able to contract with a qualifying local service provider to operate the program. To qualify, programs would need to connect individuals experiencing homelessness and living in supportive housing with employment through the city, a contracted service provider, or a private entity or prepare people for employment by providing relevant services and resources. Hourly wages must meet or exceed minimum wage. The city or CoC would be required to provide matching funds from charitable contributions or other grant funding.
AB 448, authored by Assms. Tom Daly and Sharon Quirk-Silva (D-Fullerton), would allow Orange County and any city in the county to create the Orange County Housing Trust, a joint powers authority (JPA) that can receive public and private funding and authorize debt instruments to streamline shelter and permanent supportive housing development. The JPA would fund the development of housing for individuals and families experiencing homelessness or those with extremely low- to low incomes within Orange County. The legislation was propelled forward by an Orange County Grand Jury report on the benefits of supportive housing and a UC Irvine study that showed the County could save an estimated $42 million on healthcare, law enforcement, and other local and county expenditures by funding supportive housing. The County would also be able to better leverage available funding to attract increased funding from the state.
One of the bills that stalled in the Legislature was SB 792, which would have required the Homeless Coordinating and Financing Council to develop and implement a statewide strategic plan to assist CoC lead agencies better implement HUD-recommended activities and better meet HUD requirements. SB 1010, which would have created a pilot program to provide supportive housing to parolees with mental health conditions experiencing homelessness, also did not pass the Assembly Committee on Appropriations, in part because the California Department of Corrections and Rehabilitation has already established a similar program with one county and because it would require CDCR to pay for mental health treatment for which counties already receive funding.
Wildfire and Disaster Mitigation
Governor Brown has already signed AB 1797, the first of several bills to result from the state’s most disastrous wildfire season on record. Authored by Assm. Marc Levine (D-San Rafael), the law will require insurers to conduct a replacement cost estimate that conforms to the State Department of Insurance’s methodology and rules when they sell or renew a residential insurance policy. This bill originated following recent wildfires, after which numerous consumers learned that their insurance coverage was based on outdated replacement costs and therefore inadequate to fully cover the cost of repairing or rebuilding their homes.
SB 824, authored by Sen. Ricardo Lara (D-Bell Gardens), would further protect consumers by preventing insurers from cancelling or not renewing residential insurance policies in fire-prone regions unless such actions were related to nonpayment, conviction of a crime related to increasing a property hazard, or fraud. Amendments specify that the regulations would not apply if the policy renewal threatened the insurer’s financial solvency.
SB 894, authored by Sens. Bill Dodd (D-Napa) and Mike McGuire (D-Healdsburg) and co-authored by Assemb. Levine, would allow disaster victims with insufficient insurance coverage on their primary dwelling to combine payments under other policy limits up to the total cost of rebuilding or replacing the home. Insurers would also be required to renew policies for at least two renewals or 24 months, with a 12-month extension, following a total loss.
Two companion bills, AB 1772 and AB 1800, each address different aspects of the Senate bill. AB 1772, authored by Assms. Jim Wood (D-Santa Rosa) and Cecilia Aguilar-Curry (D-Winters), would give wildfire victims 36 months to rebuild their homes and businesses following a catastrophic wildfire and extend the time policyholders can collect the full amount of the insurance payment. AB 1800, authored by Assemb. Marc Levine, would permit policyholders to collect the full replacement cost of their home after a total loss, even if they opted not to rebuild, decided to replace the home at another location, or purchased a home elsewhere.
Diana Elrod, Principal, brings more than 30 years of consulting and public sector experience to her work co-leading LDC’s housing policy and real estate finance team. Before joining LDC, she provided strategic counsel and conducted research on Housing and Community Development for the Cities of Lafayette, Belmont, Palo Alto, San Jose, San Mateo, and the County of Santa Clara. She also has completed seven Housing Elements and eight Consolidated Plans for jurisdictions throughout California. She can be reached at firstname.lastname@example.org.
Kris Kuntz, Principal, is passionate about creating innovative solutions to address homelessness. Prior to joining LDC, he performed agency-wide evaluation activities for San Diego’s largest homeless services agency, that included a drop day center, emergency shelter, transitional housing, rapid re-housing, permanent supportive housing, and a federally qualified health center. He was an integral part of Project 25, San Diego’s successful homeless high utilizer project and worked with Managed Care Organizations to sustain the project after the United Way’s initial investment. To learn more about LDC’s work with homeless assistance systems, contact him at email@example.com.
Comments Off on California House, Senate Continue Efforts to Increase Supply of Affordable Housing
Picking up where they left off at the end of the 2017 legislative session, California lawmakers in both the House and Senate advanced several bills aimed at increasing the supply of affordable housing. These include efforts to modify laws related to the Regional Housing Needs Assessment (RHNA) and Housing Element, override local zoning requirements, and produce accessory dwelling units.
SB 828 Land Use: Housing Element, authored by Sen. Scott Wiener (D-San Francisco), would require the State’s Housing and Community Development Department (HCD) to address the underproduction of housing. This bill would require cities and counties to meet 125% of their RHNA requirements in their inventories. Where that is not possible, cities and counties would be required to identify ways in which it will accommodate their RHNA, such as through rezoning. HCD would be required to complete a comprehensive assessment on the unmet needs for each region, and include the results of the assessment in regional allocations for the next housing element cycle. HCD would have to establish a methodology for the comprehensive assessment on unmet need that considers median rent or home prices and, in communities with high rates of income growth, sets a high rate of new housing production for all income levels to ensure equity and stabilize home prices. SB 828 would also prohibit a Council of Government (COG) from underestimating allocations for local jurisdictions based on predicted additional unmet need allocations. This bill would require the final regional housing need plan to reflect equitable allocations for housing of all income levels, and not demonstrate disparities that promote racial or wealth disparities throughout a region.
SB 1771Planning and Zoning: Regional Housing Needs Assessment, authored by Sen. Richard Bloom (D-Santa Monica), would require jurisdictions to adopt long-term plans that address the development of land not only inside their jurisdiction, but in some cases, outside local boundaries as well. As is currently the law, COGs would be required to create and adopt a “Final Regional Housing Needs Allocation Plan,” but which would now be required to allocate housing needs according to certain specified objectives, including doing so in an equitable manner by dispersing housing typologies, affordability levels, and housing tenure (whether owner or rental) across the region. It would also revise many of the current requirements of the RHNA plan. Plans would be required to further objectives, rather than simply be consistent with them as is currently required. COGs would be required to include data showing both the number of low-wage jobs within a jurisdiction as well as the number of housing units which are affordable to those workers. In addition, COGs will be required to project the number of low wage workers and the number of housing units needed to house them during the planning period. This would be a new focus on existing and projected demand, replacing the previous requirement to respond to housing demand. It would also limit the grounds upon which a jurisdiction could appeal to the COG to these three: the methodology was not informed by survey information submitted by the jurisdiction; the jurisdiction has undergone significant and unforeseen changes; and, the methodology used to calculate the RHNA was in violation of state law.
AB 3194Housing Accountability Act: Project Approval, authored by Assemblymember Tom Daly (D-Santa Ana), would prohibit a jurisdiction from disapproving, or placing infeasible conditions upon, a development of very low-income, low-income, or moderate-income housing (including emergency shelters), unless a preponderance of the evidence shows that the development would have a “specific, adverse impact upon the public health or safety.” The State of California defines “preponderance of the evidence” as evidence that outweighs, not in its quantity but rather in its effect, the evidence of the other side. In 2017, AB 1515 (Daly) added the requirement for “substantial evidence,” which is defined as “being of ponderable legal significance,” and “which is reasonable in nature, credible, and of solid value.” The proposed requirement for a preponderance of the evidence is a higher standard and could result in a higher number of housing developments being covered by the Housing Accountability Act (HAA). If approved, this bill would impart the protections of the HAA to projects that are both inconsistent with zoning and consistent with the objective general plan standards. Such projects would be deemed approved without having been rezoned.
Overriding Local Zoning Requirements
AB 2923San Francisco Bay Area Rapid Transit District: Transit-Oriented Development, introduced by Assemblymembers David Chiu (D-San Francisco) and Timothy Grayson (D-Concord) and coauthored by Kevin Mullin (D-San Mateo), Richard Bloom (D-Santa Monica), and Phil Ting (D-San Francisco), would require the board of the San Francisco Bay Area Rapid Transit District (BART) to adopt new TOD guidelines for certain BART-owned land. The new guidelines would establish minimum zoning requirements for land within 1/2 mile of a current or future BART entrance, on contiguous parcels that are at least .25 acres in size. The bill would also require the board to adopt streamlining measures for TOD projects, and require that projects within these areas include 20 percent affordable housing. The effect of this bill, if approved, could be that jurisdictions where BART stations are located would have little control over what is built in their communities.
SB 827 Planning and Zoning: Transit-Rich Housing Bonus, authored by Sen. Wiener (D-San Francisco), the bill would have promoted multi-family housing near transit. Among other things, SB 827 would have allowed developers to circumvent zoning in transit areas, and build to height, parking, and density levels that exceed zoning limits. The proposed height limit would have been five stories in areas within a half mile of a transit or subway station, and developers would also have benefited from reduced parking and density restrictions. Advocates of the bill purported it to be a nail in the coffin of residential racial segregation, forcing housing into neighborhoods that were historically zoned low-density in order to perpetuate the segregation of race and class. The bill failed to pass in the Committee on Transportation and Housing.
Accessory Dwelling Unit Requirements
AB 2890, authored by Sen. Ting (D-San Francisco), would require local jurisdictions to consider permit applications for ADUs within 60 days of receipt. Current law allows jurisdictions up to 120 days to consider such permits. It would also require that jurisdictions that condition permits on owner-occupancy to not monitor those units more than once per year. This bill would expand the law to allow for ministerial approval of ADUs on both single-family and multifamily lots, and prohibit certain requirements such as lot coverage standards, minimum lot size, and floor area ratio. If passed, HCD would be required to proposed small building standards by 2020, which would provide further oversight into local ordinances. If an ordinance is found to be in violation of the law, HCD could additionally notify the Attorney General.
SB 831 Land Use: Accessory Dwelling Units, introduced by Sen. Wieckowski (D-Fremont) and coauthored by Sen. Toni Atkins (D-San Diego), Sen. Nancy Skinner (D-Berkeley), and Sen. Wiener (D-San Francisco), would require jurisdictions to designate, in their ADU ordinances, any areas where ADUs would be excluded because of certain health and safety concerns. It would delete the authority to include lot coverage standards. It would also prohibit jurisdictions from taking the square footage of the proposed ADU into account when determining the allowable FAR or lot coverage. In addition, a permit for the development of an ADU would be automatically approved if not considered within 60 days of its submittal. It would prohibit requirements to replace off-street parking that is lost due to the development of an ADU. It would also prohibit the use of any other local policy, ordinance, or regulation as a means to inhibit the development of ADUs. This bill would not only prohibit local ordinances from owner-occupancy conditions, but also make void any such existing requirements. It would also prohibit a jurisdiction from considering an ADU as a “new residential use,” for purposes of determining fees. School fees would be an exception; however, they would be limited to $3,000.
Artemis Spyridonidis, Senior Associate, covers housing policy issues, including structural solutions to the housing affordability crisis, consolidated plans, housing elements, accessory dwelling unit policy implementation, and regional issues across the state of California. For information about linkage fees and other housing policy issues, contact Artemis Spyridonidis, at firstname.lastname@example.org.
Glage v. Hawes Firearms Co. (1990), 226 Cal.App.3d 314, 325, quotingPeople v. Miller (1916), 171 Cal. 6149, 652.
Comments Off on Fruitvale Village Study Highlights TOD Benefits
A new study of Oakland’s Fruitvale Village conducted by the UCLA Latino Policy and Politics Initiative showed that transit-oriented development enhanced residents’ socioeconomic well-being without resulting in the displacement of Latino residents. The study highlights how BART worked with the local Unity Council to create a community-driven transit-oriented development plan that resulted in improved education outcomes and higher incomes and home ownership rates as compared to similar communities within the region and statewide. The study provides valuable insight for other jurisdictions planning transit-oriented development projects to address the housing crisis.
Comments Off on Celebrating the 1/3 Point Progress with CASA – The Committee to House the Bay Area
Sen. Scott Wiener Speaking to CASA
CASA is a year-and-a-half long convening of diverse, multi-disciplinary Bay Area leaders to create a regional housing implementation plan that commenced in June 2017 and will wrap up in October 2018. Led by representatives from local and regional government, business, the social equity community, labor, private and affordable housing development, philanthropy, and finance, CASA is one-third of the way toward developing the plan, which aims to dramatically change the housing production paradigm and enable the Bay Area to meet its housing needs and protect its most vulnerable residents.
As the CASA facilitator, I have had the opportunity to work closely with the Co-Chairs and Metropolitan Transportation Commission (MTC) leadership to guide the process for both its Steering Committee and Technical Committee. By December, the group had held five Technical Committee meetings and one Steering Committee meeting, and had completed a significant portion of its preliminary work. You can download the meeting agendas to learn more about the group’s work, but here’s a quick recap of where we have been and a forecast on where we are going:
June: 50 members of the Steering and Technical Committees shared the impacts of the housing crisis, key obstacles faced by their organizations and constituents, and actions they were taking in response to the lack of affordability and availability of housing.
September: The three Co-Chairs presented preliminary ideas corresponding to our Actions Strategy focusing on housing production, the preservation of affordable housing stock, and the protection of vulnerable residents and communities. We also debuted our governance frameworks and action ideas templates, and received an overview of MTC’s funding sources (new vocabulary for housing and social equity folks!). Using our Gradients of Agreement decision-making system, we scored the protection and production action ideas.
October: We scored the last of the three prongs of our work – the preservation ideas, and we reviewed the scoring from the September meeting to determine where we had general agreement and/or lack of consensus. We also had detailed presentations on distinguishing between gentrification and displacement, understanding the underlying pressures and strategies to strengthen the resilience of communities, and understanding the financial realities of building housing.
December: We held our first workshop to begin building the key elements of our regional housing framework, and to gather feedback on our community engagement strategy. Detailed presentations identified the amount of publicly owned land that could be available for transit-proximate housing development, and we received an update on MTC’s work on its housing actions from its Plan Bay Area 2040.
2018 will bring continued focus on articulating our framework to ensure that the plan is equitable, inclusive, and impactful, and that it puts the Bay Area on a trajectory to meet the needs of its current and future residents. Please follow our progress as we build out and vet our action ideas through our Technical and Steering Committees, community meetings, and CASA members’ networks. If you are interested in adapting and building upon this process for your region or local community, please reach out to Jennifer at email@example.com.
With more than 30 years of experience in the real estate development and investment banking industries, Jennifer LeSar brings a diverse background to her work in community development and urban revitalization. Her technical expertise spans from policy and program development to the origination and underwriting of complex investments in equity funds, multi-family portfolios, and historic and low-income tax credit properties utilizing federal and state financing programs.
For more information about innovative approaches to address our housing crisis, contact Jennifer LeSar, President and CEO, at Jennifer@lesardevelopment.com.
Comments Off on MATCH Program to Fund Affordable Housing Near Transit
Los Angeles County took a bold step forward in its efforts to preserve affordable housing near transit earlier this month with the launch of the Metro Affordable Transit Connected Housing (MATCH) program. Touted as “new terrain” for transit agencies, the program will provide $75 million for acquisition and predevelopment financing to qualified developers to buy land or existing housing and replace it with affordable housing located near public transit. The fund is expected to produce a net increase of 1,800 units.
As part of the Los Angeles County Metro Transportation Oriented Communities program, MATCH seeks to provide convenient transit options that connect residents to schools, jobs, healthcare providers, and other amenities with the goal of improving social and health outcomes for residents. To qualify for a MATCH loan, developers must purchase land or housing within a half-mile of rail or bus lines offering peak service every 15 minutes or less.
“MATCH represents an innovative, multi-sector response to address the growing unaffordability and inequity of opportunity in the Los Angeles region,” said Kimberly Latimer-Nelligan, COO and EVP, Community Investment for the Low Income Investment Fund, the statewide nonprofit selected to serve as the fund administrator. “The goals of the MATCH Fund align directly with the Low Income Investment Fund’s work to stabilize families, boost local economies, and build more resilient communities.”
The MATCH program was funded with $9 million seed capital from the Los Angeles County Metropolitan Transportation Authority, which was matched with investments by local foundations, including the California Community Foundation, The California Endowment, and the Weingart Foundation. Three national Community Development Financial Institutions– the Enterprise Community Loan Fund, the Local Initiatives Support Corporation, and LIIF – have formed a consortium to manage the program, provide leverage financing, and originate loans.
For more information, including borrower and project eligibility, visit www.matchfundla.com.
For information about affordable housing and community development financing resources, contact Liz Tracey, Senior Principal, LDC at: firstname.lastname@example.org.
Liz Tracey is an expert on affordable housing and community development finance using tools such as the Low Income Housing Tax Credit and New Markets Tax Credits.
Comments Off on Unlocking Land for High-Impact Development
The most recent forecast shows that California needs 1.8 million new homes by 2025 to keep pace with population growth, projected to reach 39 million to 50 million by 2050, yet annually produces fewer than half the homes necessary to meet those needs. As a result, cities and counties throughout the state now face an unprecedented affordable housing crisis that threatens economic growth.
While new sources of housing financing are part of the solution, many jurisdictions are also taking steps to maximize the development potential of existing land. According to the widely circulated “A Blueprint for Addressing the Global Affordable Housing Challenge” and its California companion report “Closing California’s Housing Gap,” both published by the McKinsey Global Institute, efforts to “unlock land” are the most important measures jurisdictions can take to reduce the costs associated with housing production. This is especially true in California where the growing population and limited availability of buildable parcels makes it imperative to prioritize sites based on their capacity for high-impact development.
In recent years, many jurisdictions have turned to transit-oriented development to unlock land with existing infrastructure near transit hubs and corridors. Since 1995, the Los Angeles County Metropolitan Transportation Authority has routinely sought opportunities to collaborate with developers to increase transit use by building pedestrian-friendly communities on Metro-owned properties. To date, the agency has completed more than 2,017 housing units, as well as nearly 1.5 million square feet of combined retail and office space, across 18 projects. In 2015, the agency updated its joint development policies to require that 35% of the total housing units be affordable to households earning no more than 60% of the area median income.
Other jurisdictions are working with private landowners to spur development on underutilized or idle land. Last year, Alameda County passed a general obligation bond to provide $580 million in funding for affordable housing initiatives. One initiative capitalizes on the interest faith-based and community organizations expressed in developing their available land and buildings for affordable housing. To launch the Housing Development Capacity Building Program, the County Board of Supervisors has allocated $750,000 to provide qualifying organizations with the capacity development and training necessary to convert their assets into affordable housing. The County also seeks to leverage its contribution with other resources to expand its services.
As local governments seek to resolve the affordable housing crisis, they will need more innovative strategies to spur development by unlocking land. By analyzing how available land is currently used, local governments can determine which locations offer the greatest potential for lower-cost, high-impact housing development.
Artemis Spyridonidis covers housing policy issues, including structural solutions to the housing affordability crisis, consolidated plans, housing elements, accessory dwelling unit policy implementation, and regional issues across the state of California.
Comments Off on New Study on CA Rail System Casts Spotlight on Transit-Oriented Development
Since the early 20th century, California has forged its identity as a car-based culture, especially in the southern regions of the state. However, concerns about the impact of climate change, commute times, and the costs associated with owning a vehicle have triggered interest in alternatives to the combustion engine as the prime mover of the California economy. These options include enhancing access to one of the largest rail systems in the nation.
Rail and the California Economy, a recent report published by the University of California, Berkeley, examines the dynamic role passenger and freight rail play in shaping cities and influencing where jobs are located. California has almost 4,000 miles of track owned by Union Pacific and BNSF, with an additional 800 miles operated by short-line regional railroads. This network circulates through our main metropolitan areas (Sacramento, San Francisco, San Jose, Los Angeles, San Diego, and Fresno) and connects coastal communities with those further inland, moving over 38 million passengers to their destinations each year.
The clustering of people, firms, housing, goods, and services – called “agglomeration” or transit-oriented development – within transportation corridors adds an exciting dimension to housing development. After years of debating the environmentally-friendly concept of “smart growth,” regional planning and transportation agencies now view the underutilized land surrounding transit hubs or stations as fertile sites for increased density and vibrant employment centers.
One benefit of clustering arises from a public financing tool called “value capture,” which occurs when a transit agency leverages a station’s created value by actively seeking to develop land it owns around that station for housing, retail, and other commercial uses. San Francisco’s new Transbay Terminal is one such project. The Transbay Transit Center Project transforms downtown San Francisco and the San Francisco Bay Area’s regional transportation system by creating a “Grand Central Station of the West,” and has anchored a resurgence of the transit-friendly neighborhood. The approximately $6 billion project replaces the former Transbay Terminal at First and Mission Streets in San Francisco with a modern regional transit hub connecting eight Bay Area counties and the State of California through 11 transit systems: AC Transit, BART, Caltrain, Golden Gate Transit, Greyhound, SF Muni, SamTrans, WestCAT, Amtrak, and future high speed rail from San Francisco to Los Angeles/Anaheim.
The San Francisco Redevelopment Agency, in collaboration with the Transbay Joint Powers Authority, is developing the Transbay project through competitive bid by private developers. Financing consists of a Transportation Infrastructure Finance and Innovation Act (TIFIA) direct loan of $171 million from the U.S. Department of Transportation. The TIFIA loan is secured by a senior lien on project revenues, which include dedicated tax increment revenues from land sold and developed in the state-owned parcels surrounding the transit center (98% of revenues), and a commitment of passenger facilities charges from the transit center’s initial primary tenant, AC Transit (2% of revenues). This is the first TIFIA loan secured by value capture revenues from real estate taxes on surrounding transit-oriented development.
The study also features Redwood City as an excellent example of how transit-oriented development can generate the benefits of an agglomeration economy. By implementing a comprehensive, high-density development plan anchored by its Caltrain station, Redwood City has experienced explosive growth in the neighborhood surrounding the train station.
As a target for value capture, the land surrounding urban rail is a primary focus of new development. However, to overcome the constraints of investing in TOD areas without existing markets, financial incentives are typically required. Joint land use and leveraged funding among transit agencies, cities, and foundations are laying the groundwork for a high level of economic stimulus and return on investment in underutilized neighborhoods.
For more information about AHSC grants and technical assistance opportunities, please contact Autumn Bernstein, Principal, at email@example.com.
Autumn Bernstein, Principal, Estolano LeSar Perez (ELP) Advisors, is an expert in urban planning, transportation, housing, and environmental policy. She has 15 years of experience as a policy advocate, strategic advisor, non-profit executive, and facilitator in communities across California. Autumn is a native of the San Francisco Bay Area and lives in El Cerrito.
Comments Off on New AHSC Grant Guidelines Approved, ELP Advisors Again Provides Technical Assistance
California is gearing up for Round 3 of the Affordable Housing and Sustainable Communities (AHSC) grant program, and ELP Advisors will once again play a key role in providing technical assistance to select applicants.
On July 17th, the Strategic Growth Council (SGC) approved new guidelines for the next round of AHSC grantmaking. Earlier this month, the council announced that LDC’s affiliate, Estolano LeSar Perez Advisors, in partnership with Enterprise Community Partners, has once again been chosen to provide technical assistance to qualifying AHSC applicants. We are excited to continue our successful partnership with SGC and to team with Enterprise in providing comprehensive assistance to applicants across California.
The new AHSC guidelines make some important changes since the last round, many in response to feedback from applicants. We are hopeful that these changes will make the application process less cumbersome, more effective and allow a wider range of communities to be competitive for funding. Here’s a rundown of the major changes:
Bye bye, concept app: Repeat AHSC applicants will be happy to learn that concept applications are no longer required. They have been replaced with a checklist and an optional consultation with SGC staff. This change should greatly streamline the application process and give applicants a good idea of their competitiveness prior to investing time and money into a detailed application. A host of other, smaller changes are also aimed at streamlining and simplifying the process.
New housing and anti-displacement requirements: The guidelines strengthen and, in some cases, add new requirements aimed at ensuring AHSC funds flow to communities that are complying with state housing law and protecting vulnerable communities from displacement.
Changes to include more rural projects: Thanks to changes to the net density requirements, projects across a wider spectrum of rural communities will now be eligible for AHSC.
Indian Tribes now eligible: Federally-recognized Indian Tribes are now eligible to apply for AHSC grants.
New threshold criteria: Several scoring elements that were optional last year have become mandatory, known in AHSC lingo as “threshold” requirements. These include certain housing affordability and urban greening elements.
With the guidelines adopted and the technical assistance team in place, Round 3 of AHSC grantmaking will get underway this fall. The notice of funding availability (NOFA) will be released in October, applications will be due in January, and awards will be announced in May.
Even before the NOFA is released, the council will begin the process of selecting applicants to receive free technical assistance from ELP Advisors and Enterprise. No details yet, but we expect there to be an announcement in August. We’ll keep you posted.
For more information about AHSC grants and technical assistance opportunities, please contact Autumn Bernstein, Principal, at firstname.lastname@example.org.
Autumn Bernstein, Principal, Estolano LeSar Perez (ELP) Advisors, is an expert in urban planning, transportation, housing, and environmental policy. She has 15 years of experience as a policy advocate, strategic advisor, non-profit executive and facilitator in communities across California. Autumn is a native of the San Francisco Bay Area and lives in El Cerrito.
Comments Off on Legislature Passes Cap and Trade, Delays Vote on Affordable Housing Measures
After months of intense negotiations, Gov. Jerry Brown and state legislators reached an agreement to extend cap and trade until 2030. On Monday, the Legislature voted to approve two bills that will assure the continuation of the market-based climate program. Legislative leaders also announced that they are postponing a vote on several affordable housing bills until August.
Cap and Trade
Yesterday’s vote on Assembly Bill 398 (Eduardo Garcia, D-Coachella) will require the California Air Resources Board to establish a firm upper limit for the price of allowances or permits to emit one metric ton of greenhouse gases. The current cap-and-trade system set a floor for prices but did not have a fixed ceiling to prevent prices from rising.
Assembly Bill 617 (Cristina Garcia, D-Bell Gardens; Eduardo Garcia, and Miguel Santiago, D-Los Angeles) requires stricter air pollution monitoring around industrial facilities and tougher penalties for violating pollution regulations. This benefits communities located near these facilities.
“Today’s vote on AB 398 to extend Cap and Trade marks an important milestone in the fight against climate change,” said Sen. Toni Atkins (D-San Diego), who previously led efforts to direct cap and trade funding toward transit-oriented affordable housing projects while serving as Speaker of the Assembly. “Without this extension, California would have been in serious danger of failing to meet our ambitious, world-leading climate goals.”
Passage of these bills represents a second milestone in assuring the future of cap and trade. In June, California’s Supreme Court upheld an appeals court’s approval of the program. Opponents had challenged the program as essentially amounting to an unauthorized tax.
Amid Monday’s debate on cap and trade, the Governor, Senate President pro Tempore Kevin de León, and Assembly Speaker Anthony Rendon issued a joint statement reaffirming their shared commitment to address California’s housing needs when the Legislature resumes in August.
“Astronomical housing costs are straining family budgets and stress employees who can’t afford to live where they work. That’s unacceptable, and it’s why the affordable housing crisis has been one of our top priorities. The package of legislation we are all working on will help ensure Californians won’t have to pay an arm and a leg to have a roof over their head.”
The package of bills under consideration includes the Building Homes and Jobs Act (SB 2), which was authored by Sen. Atkins and 12 co-signers and gained momentum on July 12th following an approval vote in the Assembly Housing and Community Development Committee and a motion that allowed the bill to bypass the Appropriations Committee and move directly to the Assembly Floor.
The Building Homes and Jobs Act establishes a permanent funding source that will increase California’s supply of affordable homes, create jobs, and spur economic growth. Ongoing revenues would be obtained through fees on real estate document filings, excluding residential and commercial property sales. Fees would not exceed $225 per transaction.
Modeled on the Building Homes and Jobs Act bill (AB 1335 — Atkins), SB 2 would address the urgent need for affordable housing funding lost through the elimination of Redevelopment Agencies in January 2012. The bill would generate an estimated $200 million annually following implementation in 2018.
According to the bill’s sponsors, the California Housing Consortium and Housing California, SB 2 will create approximately 29,000 jobs for every $500 million raised, primarily in the construction sector. The bill would also leverage an additional $2.78 billion in federal, local, and private sector investment.
Other bills that will be under consideration by the Legislature include:
• Senate Bill 3, the Affordable Housing Bond Act of 2018 (Beall, D-San Jose), which would authorize a ballot measure asking voters statewide to approve $3 billion in bond financing for rental housing and existing housing programs in the November 2018 election.
• Senate Bill 35 (Wiener, D-San Francisco), which would eliminate multiple local planning reviews for individual projects that meet certain zoning and affordability standards. Under provisions negotiated with the State Building and Construction Trades Council of California, projects of more than 10 units that qualify for expedited approval would pay union-level wages to construction workers, and developers of some larger projects would have to agree to union-standard work rules or apprenticeship programs.
• Assembly Bill 45, the California School Employee Housing Assistance Grant Program (Thurmond, D-Richmond), which would require the California Housing Finance Agency (CalHFA) to administer a $25 million predevelopment grant and loan fund for the creation of affordable housing for school district employees.
For more information about innovative approaches to policy and real estate development, contact Jennifer LeSar, President and CEO at Jennifer@lesardevelopment.com.
With more than 25 years of experience in the real estate development and investment banking industries, Jennifer LeSar brings a diverse background to her work in community development and urban revitalization. Her technical expertise spans from policy and program development to the origination and underwriting of complex investments in equity funds, multi-family portfolios, and historic and low-income tax credit properties utilizing federal and state financing programs.