Sacramento Report

California's Housing Production Challenge

by Debra Carlton

California continues to experience a shortage of housing. According to the State Department of Housing and Community Development, California needs to build 220,000 single-family homes and apartment units every year to keep pace with population growth. Last year alone, fewer than 145,000 units were added to California’s housing stock.

The California Legislature continues to focus on solutions to address the state’s housing needs. Below is an overview of the bills moving through the legislative process this year that may help meet our housing challenge. The California Apartment Association’s Board of Directors has taken a support position on each of these bills.

AB 1284 (D-Lowenthal)
This bill creates the Housing Development Incentive Act of 2002, allowing local officials to use property tax revenues to build housing and promote economic development. It allows cities and counties to create housing opportunity districts, governed either by an appointed body or by the city council or the county board of supervisors ex officio. This bill is awaiting a hearing in the Senate Local Government Committee.

AB 1866 (D-Wright)
This bill requires that a local ordinance provide for administrative approval (without discretionary review by a city council or board of supervisor members) of a property owner’s application to construct a second unit on the property, so long as the second unit meets the existing requirements of the city or county. This bill is awaiting a hearing in the Senate Appropriations Committee.

AB 1882 (D-Canciamilla)
ThisbillexemptsfromtheCalifornia Environmental Quality Act “in-fill” urban development projects in Contra Costa County that are no more than five acres and that meet other criteria as spelled out in the bill. This bill is awaiting a hearing in the Senate Environmental Quality Committee.

AB 1891 (D-Diaz)
This bill requires the Department of Housing and Community Development to establish a program to make matching grants to local agencies with housing trust-fund programs that are created to finance affordable housing. This bill is awaiting a hearing in the Senate Appropriations Committee.

AB 2292 (D-Dutra)
This bill requires local government officials to make a finding that any density reduction or downzoning of private property is consistent with the community’s local housing element. It also allows court judges to award attorneys’ fees and costs to the property owner if the court determines that the density reduction or downzoning was made illegally. The bill is co-sponsored by the California Apartment Association, the California Association of Realtors, the California Rural Legal Assistance Foundation and the Western Center on Law and Poverty. This bill is awaiting a hearing in the Senate Local Government Committee.

SB 213 (D-Perata)
This bill requires the Metropolitan Transportation Commission (MTC) and the Association of Bay Area Governments (ABAG) to evaluate whether or not local governments in the San Francisco Bay Area are implementing their fair share of housing starts and are participating in regional congestion reduction plans. The MTC and ABAG are required to report its findings to the Legislature by January 1, 2003. This bill is awaiting a hearing in the Assembly Appropriations Committee.

SB 372 (D-Dunn)
This bill creates loan programs for specified entities that purchase housing and maintain rents at affordable levels for tenants. This bill is awaiting a vote on the Assembly Floor.

SB 910 (D-Dunn)
After months of negotiations with interested parties and leaders in the Senate and the Assembly, this bill will allow for penalties against local governments that fail to provide for affordable housing in their communities. It is currently awaiting a hearing in the Assembly Housing Committee.

SB 1227 (D-Burton)
This bill enacts the Housing and Emergency Shelter Trust Fund Act of 2002. It authorizes $2.1 billion in general obligation bonds for state housing programs on the approval of voters in the November 5, 2002, general election. The Governor signed this bill.

SB 1509 (D-Dunn)
This bill lessens financial burdens on those local governments that provide for affordablehousing.Itreducesthe Educational Revenue Augmentation Fund (ERAF) contribution of a city or county by an amount equal to their respective share of the property tax lost, due to new tax-exempt low-income housing. By way of background, when the voters passed Proposition 13 in 1978, they gave the California legislature the power to allocate property tax revenues. In the early 1990s, the legislature shifted shares of property tax revenues from cities, counties, and special districts to schools through the Educational Revenue Augmentation Funds in each county, leaving local governments with less discretion over property tax revenues than they had from 1979 to 1991. This bill is awaiting a final Senate Floor vote.

For more information about these and other bills, go to CAA’s web site. We will bring you the final outcome of these bills when the Legislature finishes its work this fall.

The opinions expressed in this article are those of the author and do not necessarily reflect the viewpoint of the SFAA or the SF Apartment Magazine. Debra L. Carlton is the Vice President of Policy and Research for the California Apartment Association and is CAA’s chief lobbyist. © Copyright 2002.