SBX8 28: Prop 1C Housing Rehab

No. of Jobs

1,312

Category

Invest state and federal funds to create jobs

Proposal

This bill appropriates existing Proposition 1C housing bond funds for shovel-ready projects to create jobs and build affordable housing and parks.

Summary

At this moment, $87.5 million in Proposition 1C housing bond funds have not yet been awarded. This legislation would allocate those funds to the following uses:

Shovel-Ready Green Jobs: California Recycle Underutilized Sites Program (CALReUSE) ($15 million): Grants and loans for brownfield clean up to promote housing and mixed-use development in infill areas, including in rural communities.

Homes to Prevent Homelessness: Multifamily Housing Program (MHP) ($42.5 million): Loans for private and non-profit developers to construct, rehabilitate, or preserve affordable housing for very low- and low-income households.

Increase Park Space: Housing-Related Parks ($25 million): Allows grants to build and upgrade local park facilities for local governments that invest in or approve building of affordable housing.

First-Time Homebuyers: Building Equity and Growth in Neighborhoods Program (BEGIN) ($5 million): Grants for local governments to provide down-payment assistance to low-and moderate-income, first-time homebuyers. These grants reward those local governments which support building affordable housing in their communities.

This legislation will release this money to create affordable homes, neighborhood parks, and jobs.

Background

There is a need to bring existing housing resources to shovel-ready projects. In 2009, residential construction in California is estimated to have hit its lowest level ever recorded. More than 70 percent of jobs associated with residential construction have been lost in the past four years.

Implementation delays have stalled the award of $57.5 million in innovation set-aside funding appropriated three years ago (SB 586, 2007) for four new programs: the Innovation Housing Program ($10 million) and Construction Liability Insurance Reform Pilot Program ($5 million), Affordable Housing Revolving Development and Acquisition Program-Loan Fund ($25 million), and the Local Housing Trust Fund Program for new trust funds ($17.5 million). No new local housing trust funds have applied for these funds. By contrast, existing local housing trust funds have applied and are able to locally fund shovel-ready projects. Funds for existing local housing trust funds will be preserved.

Unlike new pilot programs, other existing and high-demand programs have projects in the pipeline and don’t require ramping up. This money could be redirected to effective, existing programs that better meet the current needs of the housing construction market.

Additionally, appropriation of the Housing-Related Parks and BEGIN programs will prime the pump for the creation of parks and homeownership opportunities.

Despite the success of the last round of bond funds in fall 2009, award of bond funds is currently frozen by the Department of Finance. Once the freeze thaws, these existing programs will be poised to put people to work.

As amended February 11, 2010