AB 531: The Behavioral Health Infrastructure Bond Act of 2023.
- Session Year: 2023-2024
- House: Assembly
- Latest Version Date: 2023-10-12
Current Status:
Passed
(2023-10-12: Chaptered by Secretary of State - Chapter 789, Statutes of 2023.)
Introduced
In Committee
First Chamber
In Committee
Second Chamber
Enacted
Existing law establishes the Multifamily Housing Program administered by the Department of Housing and Community Development. Existing law requires assistance for projects under the program to be provided in the form of deferred payment loans to pay for eligible costs of specified types of development, as provided. Existing law requires that specified funds appropriated to provide housing for individuals and families who are experiencing homelessness or who are at risk of homelessness and who are inherently impacted by or at increased risk for medical diseases or conditions due to the COVID-19 pandemic or other communicable diseases be disbursed in accordance with the Multifamily Housing Program for specified uses.
The California Environmental Quality Act (CEQA) requires a lead agency, as defined, to prepare, or cause to be prepared, and certify the completion of, an environmental impact report on a project that it proposes to carry out or approve that may have a significant effect on the environment or to adopt a negative declaration if it finds that the project will not have that effect. CEQA does not apply to the approval of ministerial projects. Existing law, until July 1, 2024, exempts from CEQA a project funded to provide housing for individuals and families who are experiencing homelessness, as described above, if certain requirements are satisfied, including if the project proponent obtains an enforceable commitment to use a skilled and trained workforce for any proposed rehabilitation, construction, or major alterations, as specified.
This bill would provide that projects funded by the Behavioral Health Infrastructure Bond Act of 2024 that provide housing for individuals and families who are experiencing homelessness or who are at risk of homelessness and who are inherently impacted by or at increased risk for medical diseases or conditions due to the COVID-19 pandemic or other communicable diseases and are disbursed in accordance with the Multifamily Housing Program, or projects that are disbursed in accordance with the Behavioral Health Continuum Infrastructure Program, are a use by right and subject to the streamlined, ministerial review process. The bill would define use by right for these purposes to mean that the local governments review of the project does not require a conditional use permit, planned unit development permit, or other discretionary local government review or approval that would constitute a project subject to the approval process in CEQA.
Because the bill would revise the approval process of specified projects, the bill would impose a state-mandated local program.
Existing law authorizes the State Department of Health Care Services to, subject to an appropriation, establish a Behavioral Health Continuum Infrastructure Program to award grants as specified for the construction, acquisition, and rehabilitation of behavioral health treatment resources, as described. Existing law repeals this program on January 1, 2027.
This bill would continue that program indefinitely.
Existing law, the Bronzan-McCorquodale Act, contains provisions governing the operation and financing of community mental health services in every county through locally administered and locally controlled community mental health programs. Existing law, the Mental Health Services Act (MHSA), an initiative measure enacted by the voters as Proposition 63 in the November 2, 2004, statewide general election, establishes the Mental Health Services Fund to fund various county mental health programs.
This bill would enact the Behavioral Health Infrastructure Bond Act of 2024 which, if approved by the voters, would authorize the issuance of bonds in the amount of $6,380,000,000 to finance loans or grants for the acquisition of capital assets for the conversion, rehabilitation, or new construction of permanent supportive housing for veterans and others who are homeless and meet specified criteria, and for grants for the Behavioral Health Continuum Infrastructure Program, as specified.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
The bill would provide for the submission of specified sections of this bill and SB 326 to the voters at the March 5, 2024, statewide primary election.
Existing law establishes the Multifamily Housing Program administered by the Department of Housing and Community Development. Existing law requires assistance for projects under the program to be provided in the form of deferred payment loans to pay for eligible costs of specified types of development, as provided. Existing law requires that specified funds appropriated to provide housing for individuals and families who are experiencing homelessness or who are at risk of homelessness and who are inherently impacted by or at increased risk for medical diseases or conditions due to the COVID-19 pandemic or other communicable diseases be disbursed in accordance with the Multifamily Housing Program for specified uses.
The California Environmental Quality Act (CEQA) requires a lead agency, as defined, to prepare, or cause to be prepared, and certify the completion of, an environmental impact report on a project that it proposes to carry out or approve that may have a significant effect on the environment or to adopt a negative declaration if it finds that the project will not have that effect. CEQA does not apply to the approval of ministerial projects. Existing law, until July 1, 2024, exempts from CEQA a project funded to provide housing for individuals and families who are experiencing homelessness, as described above, if certain requirements are satisfied, including if the project proponent obtains an enforceable commitment to use a skilled and trained workforce for any proposed rehabilitation, construction, or major alterations, as specified.
This bill would provide that projects funded by the Behavioral Health Infrastructure Bond Act of 2024 that provide housing for individuals and families who are experiencing homelessness or who are at risk of homelessness and who are inherently impacted by or at increased risk for medical diseases or conditions due to the COVID-19 pandemic or other communicable diseases and are disbursed in accordance with the Multifamily Housing Program, or projects that are disbursed in accordance with the Behavioral Health Continuum Infrastructure Program, are a use by right and subject to the streamlined, ministerial review process. The bill would define use by right for these purposes to mean that the local governments review of the project does not require a conditional use permit, planned unit development permit, or other discretionary local government review or approval that would constitute a project subject to the approval process in CEQA.
Because the bill would revise the approval process of specified projects, the bill would impose a state-mandated local program.
Existing law authorizes the State Department of Health Care Services to, subject to an appropriation, establish a Behavioral Health Continuum Infrastructure Program to award grants as specified for the construction, acquisition, and rehabilitation of behavioral health treatment resources, as described. Existing law repeals this program on January 1, 2027.
This bill would continue that program indefinitely.
Existing law, the Bronzan-McCorquodale Act, contains provisions governing the operation and financing of community mental health services in every county through locally administered and locally controlled community mental health programs. Existing law, the Mental Health Services Act (MHSA), an initiative measure enacted by the voters as Proposition 63 in the November 2, 2004, statewide general election, establishes the Mental Health Services Fund to fund various county mental health programs.
This bill would enact the Behavioral Health Infrastructure Bond Act of 2024 which, if approved by the voters, would authorize the issuance of bonds in the amount of $6,380,000,000 to finance loans or grants for the acquisition of capital assets for the conversion, rehabilitation, or new construction of permanent supportive housing for veterans and others who are homeless and meet specified criteria, and for grants for the Behavioral Health Continuum Infrastructure Program, as specified.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
The bill would provide for the submission of specified sections of this bill and SB 326 to the voters at the March 5, 2024, statewide primary election.
Existing law establishes the Multifamily Housing Program administered by the Department of Housing and Community Development. Existing law requires assistance for projects under the program to be provided in the form of deferred payment loans to pay for eligible costs of specified types of development, as provided. Existing law requires that specified funds appropriated to provide housing for individuals and families who are experiencing homelessness or who are at risk of homelessness and who are inherently impacted by or at increased risk for medical diseases or conditions due to the COVID-19 pandemic or other communicable diseases be disbursed in accordance with the Multifamily Housing Program for specified uses.
The California Environmental Quality Act (CEQA) requires a lead agency, as defined, to prepare, or cause to be prepared, and certify the completion of, an environmental impact report on a project that it proposes to carry out or approve that may have a significant effect on the environment or to adopt a negative declaration if it finds that the project will not have that effect. CEQA does not apply to the approval of ministerial projects. Existing law, until July 1, 2024, exempts from CEQA a project funded to provide housing for individuals and families who are experiencing homelessness, as described above, if certain requirements are satisfied, including if the project proponent obtains an enforceable commitment to use a skilled and trained workforce for any proposed rehabilitation, construction, or major alterations, as specified.
This bill would provide that projects funded by the Behavioral Health Infrastructure Bond Act of 2024 that provide housing for individuals and families who are experiencing homelessness or who are at risk of homelessness and who are inherently impacted by or at increased risk for medical diseases or conditions due to the COVID-19 pandemic or other communicable diseases and are disbursed in accordance with the Multifamily Housing Program, or projects that are disbursed in accordance with the Behavioral Health Continuum Infrastructure Program, are a use by right and subject to the streamlined, ministerial review process. The bill would define use by right for these purposes to mean that the local governments review of the project does not require a conditional use permit, planned unit development permit, or other discretionary local government review or approval that would constitute a project subject to the approval process in CEQA.
Because the bill would revise the approval process of specified projects, the bill would impose a state-mandated local program.
Existing law authorizes the State Department of Health Care Services to, subject to an appropriation, establish a Behavioral Health Continuum Infrastructure Program to award grants as specified for the construction, acquisition, and rehabilitation of behavioral health treatment resources, as described. Existing law repeals this program on January 1, 2027.
This bill would continue that program indefinitely.
Existing law, the Bronzan-McCorquodale Act, contains provisions governing the operation and financing of community mental health services in every county through locally administered and locally controlled community mental health programs. Existing law, the Mental Health Services Act (MHSA), an initiative measure enacted by the voters as Proposition 63 in the November 2, 2004, statewide general election, establishes the Mental Health Services Fund to fund various county mental health programs.
This bill would enact the Behavioral Health Infrastructure Bond Act of 2024 which, if approved by the voters, would authorize the issuance of bonds in the amount of $4,680,000,000 $6,380,000,000 to finance loans or grants for the acquisition of capital assets for, and the construction and rehabilitation of, for the conversion, rehabilitation, or new construction of permanent supportive housing for veterans and others who are homeless and meet specified criteria, and for grants for community-based treatment settings and residential care settings, as specified. the Behavioral Health Continuum Infrastructure Program, as specified.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
The bill would provide for the submission of the provisions in this bill relating to the bond act specified sections of this bill and SB 326 to the voters at the March 5, 2024, statewide primary election.
Existing law establishes the Multifamily Housing Program administered by the Department of Housing and Community Development. Existing law requires assistance for projects under the program to be provided in the form of deferred payment loans to pay for eligible costs of specified types of development, as provided. Existing law requires that specified funds appropriated to provide housing for individuals and families who are experiencing homelessness or who are at risk of homelessness and who are inherently impacted by or at increased risk for medical diseases or conditions due to the COVID-19 pandemic or other communicable diseases be disbursed in accordance with the Multifamily Housing Program for specified uses.
The California Environmental Quality Act (CEQA) requires a lead agency, as defined, to prepare, or cause to be prepared, and certify the completion of, an environmental impact report on a project that it proposes to carry out or approve that may have a significant effect on the environment or to adopt a negative declaration if it finds that the project will not have that effect. CEQA does not apply to the approval of ministerial projects. Existing law, until July 1, 2024, exempts from CEQA a project funded to provide housing for individuals and families who are experiencing homelessness, as described above, if certain requirements are satisfied, including if the project proponent obtains an enforceable commitment to use a skilled and trained workforce for any proposed rehabilitation, construction, or major alterations, as specified.
This bill would provide that projects funded by the Behavioral Health Infrastructure Bond Act of 2024 that provide housing for individuals and families who are experiencing homelessness or who are at risk of homelessness and who are inherently impacted by or at increased risk for medical diseases or conditions due to the COVID-19 pandemic or other communicable diseases and are disbursed in accordance with the Multifamily Housing Program, or projects that are disbursed in accordance with the Behavioral Health Continuum Infrastructure Program, are a use by right and subject to the streamlined, ministerial review process. The bill would define use by right for these purposes to mean that the local governments review of the project does not require a conditional use permit, planned unit development permit, or other discretionary local government review or approval that would constitute a project subject to the approval process in CEQA.
Because the bill would revise the approval process of specified projects, the bill would impose a state-mandated local program.
Existing law authorizes the State Department of Health Care Services to, subject to an appropriation, establish a Behavioral Health Continuum Infrastructure Program to award grants as specified for the construction, acquisition, and rehabilitation of behavioral health treatment resources, as described. Existing law repeals this program on January 1, 2027.
This bill would continue that program indefinitely.
Existing law, the Bronzan-McCorquodale Act, contains provisions governing the operation and financing of community mental health services in every county through locally administered and locally controlled community mental health programs. Existing law, the Mental Health Services Act (MHSA), an initiative measure enacted by the voters as Proposition 63 in the November 2, 2004, statewide general election, establishes the Mental Health Services Fund to fund various county mental health programs.
This bill would enact the Behavioral Health Infrastructure Bond Act of 2023 2024 which, if approved by the voters, would authorize the issuance of bonds in the amount of $4,680,000,000 to finance loans or grants for the acquisition of capital assets for, and the construction and rehabilitation of, unlocked, voluntary, and community-based treatment settings and residential care settings and also for housing for veterans and others who are experiencing homelessness or are at risk of homelessness and are living with a behavioral health challenge. permanent supportive housing for veterans and others who are homeless and meet specified criteria, and for grants for community-based treatment settings and residential care settings, as specified.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
The bill would provide for the submission of the provisions in this bill relating to the bond act to the voters at the March 5, 2024, statewide primary election.
Existing law, the Bronzan-McCorquodale Act, contains provisions governing the operation and financing of community mental health services in every county through locally administered and locally controlled community mental health programs. Existing law, the Mental Health Services Act (MHSA), an initiative measure enacted by the voters as Proposition 63 in the November 2, 2004, statewide general election, establishes the Mental Health Services Fund to fund various county mental health programs.
This bill would enact the Behavioral Health Infrastructure Bond Act of 2023 which, if approved by the voters, would authorize the issuance of bonds in the amount of $4,680,000,000 to finance grants for the acquisition of capital assets for, and the construction and rehabilitation of, unlocked, voluntary, and community-based treatment settings and residential care settings and also for housing for veterans and others who are experiencing homelessness or are at risk of homelessness and are living with a behavioral health challenge.
The bill would provide for the submission of the bond act to the voters at the March 5, 2024, statewide primary election.
Existing law, the Veterans Housing and Homeless Prevention Bond Act of 2014 (the 2014 bond act), authorizes the issuance of bonds in the amount of $600,000,000, as specified, for expenditure by the California Housing Finance Agency, the Department of Housing and Community Development, and the Department of Veterans Affairs to provide housing to veterans and their families pursuant to the Veterans Housing and Homeless Prevention Act of 2014 (VHHPA).This bill would enact the Veterans Housing and Homeless Prevention Bond Act of 2024 to authorize the issuance of bonds in an amount not to exceed $600,000,000 to provide additional funding for the VHHPA. The bill would provide for the handling and disposition of the funds in the same manner as the 2014 bond act.The bill would provide for the submission of the bond act to the voters at the March 5, 2024, statewide primary election.Existing law, the Veterans Housing and Homeless Prevention Bond Act of 2014 (the 2014 bond act), authorizes the issuance of bonds in the amount of $600,000,000, as specified, for expenditure by the California Housing Finance Agency, the Department of Housing and Community Development, and the Department of Veterans Affairs to provide housing to veterans and their families pursuant to the Veterans Housing and Homeless Prevention Act of 2014 (VHHPA).
This bill would enact the Veterans Housing and Homeless Prevention Bond Act of 2024 to authorize the issuance of bonds in an amount not to exceed $600,000,000 to provide additional funding for the VHHPA. The bill would provide for the handling and disposition of the funds in the same manner as the 2014 bond act.
The bill would provide for the submission of the bond act to the voters at the March 5, 2024, statewide primary election.
(a)(1)Notwithstanding any other law, projects to provide housing pursuant to paragraph (1) or (2) of subdivision (a) of Section 5965.04 of the Welfare and Institutions Code, shall be a use by right and shall be subject to the streamlined, ministerial review process, pursuant to subdivision (b), if it meets all of the following criteria:
(A)It is located in a zone where multifamily residential use, office, retail, or parking are a principally permitted use.
(B)At least 75 percent of the perimeter of the site adjoins parcels that are developed with urban uses.
(C)It satisfies the requirements specified in subparagraphs (B) to (K), inclusive, of paragraph (6) of subdivision (a) of Section 65913.4 of the Government Code.
(D)It is not on a site or adjoined to any site where more than one-third of the square footage on the site is dedicated to industrial use.
(E)The development will meet the following objective zoning standards, objective subdivision standards, and objective design review standards:
(i)The applicable objective standards shall be those for the zone that allows residential use at a greater density between the following:
(I)The existing zoning designation for the parcel if existing zoning allows multifamily residential use.
(II)The zoning designation for the closest parcel that allows residential use at a density deemed appropriate to accommodate housing for lower income households in that jurisdiction as specified in paragraph (3) of subdivision (c) of Section 65583.2 of the Government Code.
(ii)The applicable objective standards shall be those in effect at the time that the development application is submitted to the local government pursuant to this section.
(iii)A development proposed pursuant to this section shall be eligible for the same density bonus, incentives or concessions, waivers or reductions of development standards, and parking ratios applicable to a project that meets the criteria specified in subparagraph (G) of paragraph (1) of subdivision (b) of Section 65915 of the Government Code.
(F)No housing units were acquired by eminent domain.
(G)The housing units will be in decent, safe, and sanitary condition at the time of their occupancy.
(H)The project meets the labor standards contained in Sections 65912.130 and 65912.131 of the Government Code.
(I)The project provides housing for persons who meet the criteria specified in subdivision (a) of Section 5830 of the Welfare and Institutions Code and their families.
(J)Long-term covenants and restrictions require the housing units to be restricted to persons who meet the criteria specified in subdivision (a) of Section 5830 of the Welfare and Institutions Code for no fewer than 30 years.
(2)(A)For purposes of this subdivision, parcels only separated by a street or highway shall be considered to be adjoined.
(B)For purposes of this subdivision, dedicated to industrial use means any of the following:
(i)The square footage is currently being used as an industrial use.
(ii)The most recently permitted use of the square footage is an industrial use.
(iii)The site was designated for industrial use in the latest version of a local governments general plan adopted before January 1, 2022.
(b)The project shall be subject to the following streamlined, ministerial review process:
(1)(A)If the local government determines that a development submitted pursuant to this section is consistent with the objective planning standards specified in this section, it shall approve the development.
(B)If a local government determines that a development submitted pursuant to this section is in conflict with any of the objective planning standards specified in this section, it shall provide the development proponent written documentation of which standard or standards the development conflicts with, and an explanation for the reason or reasons the development conflicts with that standard or standards, within the following timeframes:
(i)Within 60 days of submission of the development proposal to the local government if the development contains 150 or fewer housing units.
(ii)Within 90 days of submission of the development proposal to the local government if the development contains more than 150 housing units.
(C)If the local government fails to provide the required documentation pursuant to subparagraph (B), the development shall be deemed to satisfy the required objective planning standards.
(D)(i)For purposes of this section, a development is consistent with the objective planning standards if there is substantial evidence that would allow a reasonable person to conclude that the development is consistent with the objective planning standards.
(ii)For purposes of this section, a development is not in conflict with the objective planning standards solely on the basis that application materials are not included, if the application contains substantial evidence that would allow a reasonable person to conclude that the development is consistent with the objective planning standards.
(E)The determination of whether a proposed project submitted pursuant to this section is or is not in conflict with the objective planning standards is not a project as defined in Section 21065 of the Public Resources Code.
(2)Design review of the development may be conducted by the local governments planning commission or any equivalent board or commission responsible for design review. That design review shall be objective and be strictly focused on assessing compliance with criteria required for streamlined, ministerial review of projects, as well as any reasonable objective design standards published and adopted by ordinance or resolution by a local jurisdiction before submittal of the development to the local government, and shall be broadly applicable to developments within the jurisdiction. That design review shall be completed as follows and shall not in any way inhibit, chill, or preclude the ministerial approval provided by this section or its effect, as applicable:
(A)Within 90 days of submittal of the development proposal to the local government pursuant to this section if the development contains 150 or fewer housing units.
(B)Within 180 days of submittal of the development proposal to the local government pursuant to this section if the development contains more than 150 housing units.
(c)Division 13 (commencing with Section 21000) of the Public Resources Code shall not apply to actions taken by the Department of Housing and Community Development, the State Department of Health Care Services, or a local agency to provide financial assistance or insurance for the development and construction of projects built pursuant to this section.
(d)The applicant shall file a notice of exemption with the Office of Planning and Research and the county clerk of the county in which the project is located in the manner specified in subdivisions (b) and (c) of Section 21152 of the Public Resources Code.
(e)For purposes of this section, the following definitions shall apply:
(1)Objective zoning standards, objective subdivision standards, and objective design review standards mean standards that involve no personal or subjective judgment by a public official and are uniformly verifiable by reference to an external and uniform benchmark or criterion available and knowable by both the development applicant or proponent and the public official before submittal. These standards may be embodied in alternative objective land use specifications adopted by a city or county, and may include, but are not limited to, housing overlay zones, specific plans, inclusionary zoning ordinances, and density bonus ordinances.
(2)Use by right means a development project that satisfies both of the following conditions:
(A)The development project does not require a conditional use permit, planned unit development permit, or other discretionary local government review.
(B)The development project is not a project for purposes of Division 13 (commencing with Section 21000) of the Public Resources Code.
SEC. 2.Section 5960.31 is added to the Welfare and Institutions Code, to read:5960.31.(a)Notwithstanding any other law, projects funded pursuant to paragraph (3) or (4) of subdivision (b) of Section 5965.04 shall be a use by right and shall be subject to the streamlined, ministerial review process and filing requirement, pursuant to subdivisions (b) and (d) of Section 50675.1.5 of the Health and Safety Code, and not subject to a conditional use permit, discretionary permit, or to any other discretionary reviews or approvals, if it meets the criteria of paragraph (1) or (2) and complies with subdivisions (b) and (c).
(1)The project is a behavioral health treatment and residential setting, including, but not limited to, childrens residential crisis programs, peer respite, childrens and adult substance use disorder residential programs, recovery housing, short-term residential therapeutic program, and social rehabilitation program, and shall be located in a zone where residential, office, retail, or parking are a principally permitted use.
(2)(A)The project is a real estate asset, as described in Section 5960.05, except for those described in paragraph (1), or in subparagraph (A) of paragraph (1) of subdivision (a) of Section 5831, that is funded pursuant to Section 5967.01, and shall be located in a zone where office, retail, or parking are a principally permitted use.
(B)This paragraph shall not be construed to limit the discretion of local jurisdictions to permit real estate assets in a zone not expressly provided in this paragraph.
(b)Projects, as applicable, pursuant to this section shall comply with the core components of Housing First, as defined under subdivision (b) of Section 8255, and may include recovery housing, as defined by the United States Department of Housing and Urban Development.
(c)Projects pursuant to this section shall meet the labor standards contained in Sections 65912.130 and 65912.131 of the Government Code.
(d)For purposes of this section, use by right means a development project that satisfies both of the following conditions:
(1)The development project does not require a conditional use permit, planned unit development permit, or other discretionary local government review.
(2)The development project is not a project for purposes of Division 13 (commencing with Section 21000) of the Public Resources Code.
SEC. 3.Section 5960.45 of the Welfare and Institutions Code is repealed.SEC. 4.Chapter 4 (commencing with Section 5965) is added to Part 7 of Division 5 of the Welfare and Institutions Code, to read:4.Behavioral Health Infrastructure Bond Act of 20245965.This chapter shall be known, and may be cited, as the Behavioral Health Infrastructure Bond Act of 2024.
5965.01.The purposes and intent in enacting this act are as follows:
(a)Bonds issued under this act are to develop an array of treatment, residential care settings, and supportive housing to help provide appropriate care facilities for Californians experiencing mental health conditions and substance use disorders.
(b)The bond will dedicate funding for veterans with a behavioral health challenge or substance use disorder and at risk of experiencing homelessness.
(c)Efforts to streamline the process for approving projects and renovating or building new facilities to accelerate the delivery of care in residential settings made available through additional Behavioral Health Services Act and bond financing is a priority.
5965.02.As used in this chapter, the following terms have the following meanings:
(a)Act means the Behavioral Health Infrastructure Bond Act of 2024 (Chapter 4 (commencing with Section 5965)).
(b)Behavioral health challenge includes, but is not limited to, serious mental illness, as described in subdivision (c) or (d) of Section 14184.402, or a substance use disorder, as described in Section 5891.5.
(c)Board means, with respect to the bond proceeds referenced in paragraphs (3) and (4) of subdivision (b) of Section 5965.04, and with respect to and for requests up to the amount specified for bond proceeds referenced in paragraphs (3) and (4) of subdivision (b) of Section 5965.04, for purposes of Section 5965.12 of this code and Section 16726 of the Government Code, the State Department of Health Care Services, and with respect to bond proceeds referenced in paragraphs (1) and (2) of subdivision (b) of Section 5965.04, and, with respect to and for requests up to the amount specified for bond proceeds referenced in paragraphs (1) and (2) of subdivision (b) of Section 5965.04, for purposes of Section 5965.12 of this code and Section 16726 of the Government Code, the Department of Housing and Community Development.
(d)Committee means the Behavioral Health Infrastructure Bond Act Finance Committee created pursuant to Section 5965.07.
(e)Fund means the Behavioral Health Infrastructure Fund created pursuant to Section 5965.03.
(f)State General Obligation Bond Law means the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), as it may be amended.
(g)Target population means a person described in subdivision (c) or (d) of Section 14184.402, or a person with a substance use disorder, as described in Section 5891.5, except that enrollment in Medi-Cal or in any other health plan shall not be a condition for accessing housing or continuing to be housed.
(h)Veteran means a person who served in the active military, naval, or air service, and who was discharged or released under conditions other than dishonorable.
5965.03.(a)The proceeds of interim debt and bonds, excluding proceeds used directly to repay interim debt and excluding bonds issued in accordance with Section 5965.14, issued and sold pursuant to this chapter shall be deposited in the Behavioral Health Infrastructure Fund, which is hereby created in the State Treasury.
(b)All moneys in the fund, notwithstanding Section 13340 of the Government Code, are hereby continuously appropriated without respect to fiscal years for the purposes of this chapter.
(c)Bonds shall be issued and delivered in the amount determined by the committee to be necessary or desirable pursuant to Section 5965.08.
5965.04.(a)Moneys in the fund shall be used for any of the following purposes:
(1)Making loans or grants administered by the Department of Housing and Community Development to eligible entities specified under Section 50675.1.3 of the Health and Safety Code or loans to development sponsors as defined under Section 50675.2 of the Health and Safety Code to acquire capital assets for the conversion, rehabilitation, or new construction of permanent supportive housing, including scattered site projects, for veterans or their households, who are homeless, chronically homeless, or are at risk of homelessness, as defined by Part 578.3 of Title 24 of the Code of Federal Regulations, and meet the criteria of the target population.
(2)Making loans or grants administered by the Department of Housing and Community Development to eligible entities specified under Section 50675.1.3 of the Health and Safety Code or loans to development sponsors as defined under Section 50675.2 of the Health and Safety Code to acquire capital assets for the conversion, rehabilitation, or new construction of permanent supportive housing, including scattered site projects for persons who are homeless, chronically homeless, or are at risk of homelessness, as defined by Part 578.3 of Title 24 of the Code of Federal Regulations, and are living with a behavioral health challenge.
(3)Making grants administered by the State Department of Health Care Services, as specified under the Behavioral Health Continuum Infrastructure Program to eligible entities specified pursuant to Chapter 1 (commencing with Section 5960) to construct, acquire, and rehabilitate real estate assets or to invest in needed infrastructure to expand the continuum of behavioral health treatment resources to build new capacity or expand existing capacity for short-term crisis stabilization, acute and subacute care, crisis residential, community-based mental health residential, substance use disorder residential, peer respite, community and outpatient behavioral health services, and other clinically enriched longer term treatment and rehabilitation options for persons with behavioral health disorders in the least restrictive and least costly setting.
(4)(A)Paying the costs of issuing bonds, paying the annual administration costs of the bonds, and paying interest on bonds.
(B)In addition, moneys in the fund or other proceeds of the sale of bonds authorized by this chapter may be used to pay principal of, or redemption premium on, interim debt issued prior to the issuance of bonds authorized by this chapter.
(b)Moneys in the fund shall be allocated as follows:
(1)One billion sixty-five million dollars ($1,065,000,000) of the proceeds of the bonds, after allocation of bond proceeds to the purposes described in paragraph (4) of subdivision (a), shall be used for the loans or grants, loan or grant implementation, and loan or grant oversight described in paragraph (1) of subdivision (a) and administrative costs.
(2)Nine hundred twenty-two million dollars ($922,000,000) of the proceeds of the bonds, after allocation of bond proceeds to the purposes described in paragraph (4) of subdivision (a), shall be used for the loans or grants, loan or grant implementation, and loan or grant oversight, as described in paragraph (2) of subdivision (a), and administrative costs.
(3)One billion five hundred million dollars ($1,500,000,000) of the proceeds of the bonds shall be awarded to cities, counties, city and counties, and tribal entities, after allocation of bond proceeds to the purposes described in paragraph (4) of subdivision (a) for grants, grant implementation, and grant oversight, as described in paragraph (3) of subdivision (a), and administrative costs. Of this amount, thirty million dollars ($30,000,000) shall be designated to tribal entities.
(4)Up to two billion eight hundred ninety-three million dollars ($2,893,000,000) of the proceeds of the bonds, after allocation of bond proceeds to the purposes of paragraph (4) of subdivision (a), shall be used for grants, grant implementation, and grant oversight, as described in paragraph (3) of subdivision (a), and administrative costs.
5965.05.(a)(1)Bonds in the total amount of six billion three hundred eighty million dollars ($6,380,000,000) not including the amount of refunding bonds issued in accordance with Section 5965.14, may be issued and sold for the purposes expressed in this chapter and to reimburse the General Obligation Bond Expense Revolving Fund pursuant to Section 16724.5 of the Government Code.
(2)The bonds, when sold, issued, and delivered, shall be and constitute a valid and binding obligation of the State of California, and the full faith and credit of the State of California is hereby pledged for the punctual payment of both the principal of, and interest on, the bonds as the principal and interest become due and payable.
(b)(1)The Treasurer shall issue and sell the bonds authorized in subdivision (a) in the amount determined by the committee to be necessary or desirable pursuant to Section 5965.08. The bonds shall be issued and sold upon the terms and conditions specified in a resolution to be adopted by the committee pursuant to Section 16731 of the Government Code.
(2)The bonds shall be issued and sold upon the terms and conditions specified in a resolution to be adopted by the committee pursuant to Section 5965.08.
5965.06.The bonds authorized by this chapter shall be prepared, executed, issued, sold, paid, and redeemed as provided in the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), as amended, from time to time, and all of the provisions of that law, as amended, apply to the bonds and to this chapter and are hereby incorporated in this chapter as though set forth in full in this chapter, except that subdivisions (a) and (b) of Section 16727 of the Government Code shall not apply.
5965.07.(a)Solely for the purpose of authorizing the issuance and sale, pursuant to the State General Obligation Bond Law, of the bonds authorized by this chapter, the Behavioral Health Infrastructure Bond Act Finance Committee is hereby created.
(b)(1)The committee consists of the Controller, the Treasurer, and the Director of Finance.
(2)Notwithstanding any other law, a member may designate a representative to act as that member in the members place, for all purposes, as though the member were personally present.
(c)(1)The Treasurer shall serve as chairperson of the committee.
(2)A majority of the committee may act for the committee.
5965.08.(a)The committee shall determine, by resolution, whether it is necessary or desirable to issue and sell bonds authorized pursuant to this chapter to carry out the actions specified in this chapter and, if so, the amount of bonds to be issued and sold.
(b)Successive issues of bonds may be authorized and sold to carry out those actions progressively, and it is not necessary that all of the bonds authorized to be issued be sold at any one time.
5965.09.(a)There shall be collected each year, and in the same manner and at the same time as other state revenue is collected, in addition to the ordinary revenues of the state, a sum in an amount required to pay the principal of, and interest on, the bonds becoming due each year.
(b)It is the duty of all officers charged by law with a duty in regard to the collection of the revenue to do and perform each and every act that is necessary to collect that additional sum.
5965.10.Notwithstanding Section 13340 of the Government Code, there is hereby continuously appropriated from the General Fund in the State Treasury, for the purposes of this chapter and without regard to fiscal years, an amount that equals the total of the following:
(a)The sum annually necessary to pay the principal of, and interest on, bonds issued and sold pursuant to this chapter, as the principal and interest become due and payable.
(b)The sum necessary to carry out Section 5965.11.
5965.11.(a)For the purpose of carrying out this chapter, the Director of Finance may authorize the withdrawal from the General Fund of an amount or amounts not to exceed the amount of the unsold bonds that have been authorized by the committee to be sold for the purpose of carrying out this chapter, excluding refunding bonds authorized pursuant to Section 5965.14 less any amount loaned pursuant to Section 5965.12 and not yet repaid, and any amount withdrawn from the General Fund pursuant to this section and not yet returned to the General Fund.
(b)Any amounts withdrawn shall be deposited in the fund.
(c)Any moneys made available under this section shall be returned to the General Fund, with interest at the rate earned by the moneys in the Pooled Money Investment Account, from proceeds received from the sale of bonds for the purpose of carrying out this chapter.
5965.12.(a)The board may request the Pooled Money Investment Board to make a loan from the Pooled Money Investment Account, in accordance with Section 16312 of the Government Code, for the purpose of carrying out this chapter.
(b)The amount of the request shall not exceed the amount of the unsold bonds that the committee has, by resolution, authorized to be sold for the purpose of carrying out this chapter, excluding refunding bonds authorized pursuant to Section 5965.14, less any amount loaned pursuant to this section and not yet repaid and withdrawn from the General Fund pursuant to Section 5965.11 and not yet returned to the General Fund.
(c)The board shall execute documents required by the Pooled Money Investment Board to obtain and repay the loan.
(d)Any amounts loaned shall be deposited in the fund to be allocated by the board in accordance with this chapter.
5965.13.All moneys deposited in the fund that are derived from premium and accrued interest on bonds sold pursuant to this chapter shall be reserved in the fund and shall be available for transfer to the General Fund as a credit to expenditures for bond interest, except that amounts derived from premium may be reserved and used to pay costs of bond issuance before any transfer to the General Fund.
5965.14.(a)The bonds issued and sold pursuant to this chapter may be refunded in accordance with Article 6 (commencing with Section 16780) of Chapter 4 of Part 3 of Division 4 of Title 2 of the Government Code, which is a part of the State General Obligation Bond Law.
(b)Approval by the voters of the state for the issuance of the bonds described in this chapter includes the approval of the issuance of bonds issued to refund bonds originally issued under this chapter or any previously issued refunding bonds.
(c)A bond refunded with the proceeds of refunding bonds, as authorized by this section, may be legally defeased to the extent permitted by law in the manner and to the extent set forth in the resolution, as amended, authorizing that refunded bond.
5965.15.(a)Notwithstanding any provision of this chapter or the State General Obligation Bond Law, if the Treasurer sells bonds pursuant to this chapter that include a bond counsel opinion to the effect that the interest on the bonds is excluded from gross income for federal tax purposes, under designated conditions, or is otherwise entitled to a federal tax advantage, the Treasurer may maintain separate accounts for the investment of bond proceeds and the investment earnings on those proceeds.
(b)The Treasurer may use or direct the use of those proceeds or earnings to pay a rebate, penalty, or other payment required under federal law or to take any other action with respect to the investment and use of those bond proceeds, required or desirable under federal law, to maintain the tax-exempt status of those bonds and to obtain any other advantage under federal law on behalf of the funds of this state.
5965.16.The proceeds from the sale of bonds authorized by this chapter are not proceeds of taxes as that term is used in Article XIIIB of the California Constitution, and the disbursement of these proceeds is not subject to the limitations imposed by that article.
5966.(a)(1)The Department of Housing and Community Development, in coordination with the Department of Veterans Affairs, shall determine the methodology and distribution of the funds provided pursuant to paragraph (1) of subdivision (b) of Section 5965.04, used for the purposes provided in paragraph (1) of subdivision (a) of Section 5965.04.
(2)The Department of Housing and Community Development and the Department of Veterans Affairs shall work in coordination pursuant to a memorandum of understanding.
(b)The Department of Housing and Community Development shall determine the methodology and distribution of the funds provided pursuant to paragraph (2) of subdivision (b) of Section 5965.04, used for the purposes provided in paragraph (2) of subdivision (a) of Section 5965.04.
5966.02.(a)(1)Notwithstanding any other law, funds allocated for the purposes specified in paragraphs (1) and (2) of subdivision (a) of Section 5965.04 shall be disbursed in accordance with subdivisions (a) to (h), inclusive, of Section 50675.1.3 of the Health and Safety Code and any associated guidelines changes to that program, as provided in the Multifamily Housing Program in Chapter 6.7 (commencing with Section 50675) of Part 2 of Division 31 of the Health and Safety Code, and this chapter, consistent with applicable law and guidance.
(2)The Department of Housing and Community Development shall issue guidance regarding implementation by July 1, 2025.
(b)In developing the methodology and distribution of funds referenced in subdivision (a) of Section 5966, the Department of Housing and Community Development shall consult with the Department of Veterans Affairs regarding supportive services plan standards and other program areas where the Department of Veterans Affairs holds expertise for the purposes specified in paragraph (1) of subdivision (a) of Section 5965.04.
5967.The Department of Health Care Services shall determine the methodology and distribution of the funds provided pursuant to paragraphs (3) and (4) of subdivision (b) of Section 5965.04, used for the purposes provided in paragraphs (3) and (4) of subdivision (a) of Section 5965.04.
5967.01.(a)Notwithstanding any other law, funds allocated for the purposes specified in paragraph (3) of subdivision (a) of Section 5965.04 shall be disbursed in accordance with the Behavioral Health Continuum Infrastructure Program (commencing with Section 5960), and this chapter, consistent with applicable law and guidance.
(b)The Department of Health Care Services shall issue guidance regarding the implementation of this article by July 1, 2025.
SEC. 5.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because a local agency or school district has the authority to levy service charges, fees, or assessments sufficient to pay for the program or level of service mandated by this act, within the meaning of Section 17556 of the Government Code.
SEC. 6.Sections 1, 2, and 3 of this act shall take effect upon the approval by the voters of the Behavioral Health Infrastructure Bond Act of 2024, as set forth in Section 4 of this act.
SEC. 7.(a)Section 4 of this act and Sections 1, 2, 14, 15, 18 to 23, inclusive, 28 to 30, inclusive, 35 to 40, inclusive, 42 to 44, inclusive, 49 to 59, inclusive, 62 to 64, inclusive, 73 to 81, inclusive, 86 to 95, inclusive, 98 to 100, inclusive, 103 to 112, inclusive, 116, and 117 of the Behavioral Health Services Act, as set forth in Senate Bill 326 of the 202324 Regular Session, shall be submitted to the voters at the March 5, 2024, statewide primary election, and shall appear on the ballot as a single measure in accordance with provisions of the Government Code and the Elections Code governing the submission of a statewide measure to the voters.
(b)Notwithstanding Sections 13115 and 13117 of the Elections Code or any other law, the single measure described in subdivision (a), shall be placed as the first measure on the March 5, 2024, statewide primary election ballot and shall be designated as Proposition 1.
(c)Notwithstanding Sections 13115 and 13117 of the Elections Code or any other law, all other measures proposed by the Legislature at the 202324 Regular Session for submission to the voters at the March 5, 2024, statewide primary election shall immediately follow Proposition 1 and be designated on the statewide primary election ballot as the next in order numerically pursuant to Section 13117 of the Elections Code.
(a)(1)Notwithstanding any other law, projects to provide housing pursuant to paragraph (1) or (2) of subdivision (a) of Section 5965.04 of the Welfare and Institutions Code, shall be a use by right and shall be subject to the streamlined, ministerial review process, pursuant to subdivision (b), if it meets all of the following criteria:
(A)It is located in a zone where multifamily residential use, office, retail, or parking are a principally permitted use.
(B)At least 75 percent of the perimeter of the site adjoins parcels that are developed with urban uses.
(C)It satisfies the requirements specified in subparagraphs (B) to (K), inclusive, of paragraph (6) of subdivision (a) of Section 65913.4 of the Government Code.
(D)It is not on a site or adjoined to any site where more than one-third of the square footage on the site is dedicated to industrial use.
(E)The development will meet the following objective zoning standards, objective subdivision standards, and objective design review standards:
(i)The applicable objective standards shall be those for the zone that allows residential use at a greater density between the following:
(I)The existing zoning designation for the parcel if existing zoning allows multifamily residential use.
(II)The zoning designation for the closest parcel that allows residential use at a density deemed appropriate to accommodate housing for lower income households in that jurisdiction as specified in paragraph (3) of subdivision (c) of Section 65583.2 of the Government Code.
(ii)The applicable objective standards shall be those in effect at the time that the development application is submitted to the local government pursuant to this section.
(iii)A development proposed pursuant to this section shall be eligible for the same density bonus, incentives or concessions, waivers or reductions of development standards, and parking ratios applicable to a project that meets the criteria specified in subparagraph (G) of paragraph (1) of subdivision (b) of Section 65915 of the Government Code.
(F)No housing units were acquired by eminent domain.
(G)The housing units will be in decent, safe, and sanitary condition at the time of their occupancy.
(H)The project meets the labor standards contained in Sections 65912.130 and 65912.131 of the Government Code.
(I)The project provides housing for persons who meet the criteria specified in subdivision (a) of Section 5830 of the Welfare and Institutions Code and their families.
(J)Long-term covenants and restrictions require the housing units to be restricted to persons who meet the criteria specified in subdivision (a) of Section 5830 of the Welfare and Institutions Code for no fewer than 30 years.
(2)(A)For purposes of this subdivision, parcels only separated by a street or highway shall be considered to be adjoined.
(B)For purposes of this subdivision, dedicated to industrial use means any of the following:
(i)The square footage is currently being used as an industrial use.
(ii)The most recently permitted use of the square footage is an industrial use.
(iii)The site was designated for industrial use in the latest version of a local governments general plan adopted before January 1, 2022.
(b)The project shall be subject to the following streamlined, ministerial review process:
(1)(A)If the local government determines that a development submitted pursuant to this section is consistent with the objective planning standards specified in this section, it shall approve the development.
(B)If a local government determines that a development submitted pursuant to this section is in conflict with any of the objective planning standards specified in this section, it shall provide the development proponent written documentation of which standard or standards the development conflicts with, and an explanation for the reason or reasons the development conflicts with that standard or standards, within the following timeframes:
(i)Within 60 days of submission of the development proposal to the local government if the development contains 150 or fewer housing units.
(ii)Within 90 days of submission of the development proposal to the local government if the development contains more than 150 housing units.
(C)If the local government fails to provide the required documentation pursuant to subparagraph (B), the development shall be deemed to satisfy the required objective planning standards.
(D)(i)For purposes of this section, a development is consistent with the objective planning standards if there is substantial evidence that would allow a reasonable person to conclude that the development is consistent with the objective planning standards.
(ii)For purposes of this section, a development is not in conflict with the objective planning standards solely on the basis that application materials are not included, if the application contains substantial evidence that would allow a reasonable person to conclude that the development is consistent with the objective planning standards.
(E)The determination of whether a proposed project submitted pursuant to this section is or is not in conflict with the objective planning standards is not a project as defined in Section 21065 of the Public Resources Code.
(2)Design review of the development may be conducted by the local governments planning commission or any equivalent board or commission responsible for design review. That design review shall be objective and be strictly focused on assessing compliance with criteria required for streamlined, ministerial review of projects, as well as any reasonable objective design standards published and adopted by ordinance or resolution by a local jurisdiction before submittal of the development to the local government, and shall be broadly applicable to developments within the jurisdiction. That design review shall be completed as follows and shall not in any way inhibit, chill, or preclude the ministerial approval provided by this section or its effect, as applicable:
(A)Within 90 days of submittal of the development proposal to the local government pursuant to this section if the development contains 150 or fewer housing units.
(B)Within 180 days of submittal of the development proposal to the local government pursuant to this section if the development contains more than 150 housing units.
(c)Division 13 (commencing with Section 21000) of the Public Resources Code shall not apply to actions taken by the Department of Housing and Community Development, the State Department of Health Care Services, or a local agency to provide financial assistance or insurance for the development and construction of projects built pursuant to this section.
(d)The applicant shall file a notice of exemption with the Office of Planning and Research and the county clerk of the county in which the project is located in the manner specified in subdivisions (b) and (c) of Section 21152 of the Public Resources Code.
(e)For purposes of this section, the following definitions shall apply:
(1)Objective zoning standards, objective subdivision standards, and objective design review standards mean standards that involve no personal or subjective judgment by a public official and are uniformly verifiable by reference to an external and uniform benchmark or criterion available and knowable by both the development applicant or proponent and the public official before submittal. These standards may be embodied in alternative objective land use specifications adopted by a city or county, and may include, but are not limited to, housing overlay zones, specific plans, inclusionary zoning ordinances, and density bonus ordinances.
(2)Use by right means a development project that satisfies both of the following conditions:
(A)The development project does not require a conditional use permit, planned unit development permit, or other discretionary local government review.
(B)The development project is not a project for purposes of Division 13 (commencing with Section 21000) of the Public Resources Code.
SEC. 2.Section 5960.31 is added to the Welfare and Institutions Code, to read:5960.31.(a)Notwithstanding any other law, projects funded pursuant to paragraph (3) or (4) of subdivision (b) of Section 5965.04 shall be a use by right and shall be subject to the streamlined, ministerial review process and filing requirement, pursuant to subdivisions (b) and (d) of Section 50675.1.5 of the Health and Safety Code, and not subject to a conditional use permit, discretionary permit, or to any other discretionary reviews or approvals, if it meets the criteria of paragraph (1) or (2) and complies with subdivisions (b) and (c).
(1)The project is a behavioral health treatment and residential setting, including, but not limited to, childrens residential crisis programs, peer respite, childrens and adult substance use disorder residential programs, recovery housing, short-term residential therapeutic program, and social rehabilitation program, and shall be located in a zone where residential, office, retail, or parking are a principally permitted use.
(2)(A)The project is a real estate asset, as described in Section 5960.05, except for those described in paragraph (1), or in subparagraph (A) of paragraph (1) of subdivision (a) of Section 5831, that is funded pursuant to Section 5967.01, and shall be located in a zone where office, retail, or parking are a principally permitted use.
(B)This paragraph shall not be construed to limit the discretion of local jurisdictions to permit real estate assets in a zone not expressly provided in this paragraph.
(b)Projects, as applicable, pursuant to this section shall comply with the core components of Housing First, as defined under subdivision (b) of Section 8255, and may include recovery housing, as defined by the United States Department of Housing and Urban Development.
(c)Projects pursuant to this section shall meet the labor standards contained in Sections 65912.130 and 65912.131 of the Government Code.
(d)For purposes of this section, use by right means a development project that satisfies both of the following conditions:
(1)The development project does not require a conditional use permit, planned unit development permit, or other discretionary local government review.
(2)The development project is not a project for purposes of Division 13 (commencing with Section 21000) of the Public Resources Code.
SEC. 3.Section 5960.45 of the Welfare and Institutions Code is repealed.SEC. 4.Chapter 4 (commencing with Section 5965) is added to Part 7 of Division 5 of the Welfare and Institutions Code, to read:4.Behavioral Health Infrastructure Bond Act of 20245965.This chapter shall be known, and may be cited, as the Behavioral Health Infrastructure Bond Act of 2024.
5965.01.The purposes and intent in enacting this act are as follows:
(a)Bonds issued under this act are to develop an array of treatment, residential care settings, and supportive housing to help provide appropriate care facilities for Californians experiencing mental health conditions and substance use disorders.
(b)The bond will dedicate funding for veterans with a behavioral health challenge or substance use disorder and at risk of experiencing homelessness.
(c)Efforts to streamline the process for approving projects and renovating or building new facilities to accelerate the delivery of care in residential settings made available through additional Behavioral Health Services Act and bond financing is a priority.
5965.02.As used in this chapter, the following terms have the following meanings:
(a)Act means the Behavioral Health Infrastructure Bond Act of 2024 (Chapter 4 (commencing with Section 5965)).
(b)Behavioral health challenge includes, but is not limited to, serious mental illness, as described in subdivision (c) or (d) of Section 14184.402, or a substance use disorder, as described in Section 5891.5.
(c)Board means, with respect to the bond proceeds referenced in paragraphs (3) and (4) of subdivision (b) of Section 5965.04, and with respect to and for requests up to the amount specified for bond proceeds referenced in paragraphs (3) and (4) of subdivision (b) of Section 5965.04, for purposes of Section 5965.12 of this code and Section 16726 of the Government Code, the State Department of Health Care Services, and with respect to bond proceeds referenced in paragraphs (1) and (2) of subdivision (b) of Section 5965.04, and, with respect to and for requests up to the amount specified for bond proceeds referenced in paragraphs (1) and (2) of subdivision (b) of Section 5965.04, for purposes of Section 5965.12 of this code and Section 16726 of the Government Code, the Department of Housing and Community Development.
(d)Committee means the Behavioral Health Infrastructure Bond Act Finance Committee created pursuant to Section 5965.07.
(e)Fund means the Behavioral Health Infrastructure Fund created pursuant to Section 5965.03.
(f)State General Obligation Bond Law means the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), as it may be amended.
(g)Target population means a person described in subdivision (c) or (d) of Section 14184.402, or a person with a substance use disorder, as described in Section 5891.5, except that enrollment in Medi-Cal or in any other health plan shall not be a condition for accessing housing or continuing to be housed.
(h)Veteran means a person who served in the active military, naval, or air service, and who was discharged or released under conditions other than dishonorable.
5965.03.(a)The proceeds of interim debt and bonds, excluding proceeds used directly to repay interim debt and excluding bonds issued in accordance with Section 5965.14, issued and sold pursuant to this chapter shall be deposited in the Behavioral Health Infrastructure Fund, which is hereby created in the State Treasury.
(b)All moneys in the fund, notwithstanding Section 13340 of the Government Code, are hereby continuously appropriated without respect to fiscal years for the purposes of this chapter.
(c)Bonds shall be issued and delivered in the amount determined by the committee to be necessary or desirable pursuant to Section 5965.08.
5965.04.(a)Moneys in the fund shall be used for any of the following purposes:
(1)Making loans or grants administered by the Department of Housing and Community Development to eligible entities specified under Section 50675.1.3 of the Health and Safety Code or loans to development sponsors as defined under Section 50675.2 of the Health and Safety Code to acquire capital assets for the conversion, rehabilitation, or new construction of permanent supportive housing, including scattered site projects, for veterans or their households, who are homeless, chronically homeless, or are at risk of homelessness, as defined by Part 578.3 of Title 24 of the Code of Federal Regulations, and meet the criteria of the target population.
(2)Making loans or grants administered by the Department of Housing and Community Development to eligible entities specified under Section 50675.1.3 of the Health and Safety Code or loans to development sponsors as defined under Section 50675.2 of the Health and Safety Code to acquire capital assets for the conversion, rehabilitation, or new construction of permanent supportive housing, including scattered site projects for persons who are homeless, chronically homeless, or are at risk of homelessness, as defined by Part 578.3 of Title 24 of the Code of Federal Regulations, and are living with a behavioral health challenge.
(3)Making grants administered by the State Department of Health Care Services, as specified under the Behavioral Health Continuum Infrastructure Program to eligible entities specified pursuant to Chapter 1 (commencing with Section 5960) to construct, acquire, and rehabilitate real estate assets or to invest in needed infrastructure to expand the continuum of behavioral health treatment resources to build new capacity or expand existing capacity for short-term crisis stabilization, acute and subacute care, crisis residential, community-based mental health residential, substance use disorder residential, peer respite, community and outpatient behavioral health services, and other clinically enriched longer term treatment and rehabilitation options for persons with behavioral health disorders in the least restrictive and least costly setting.
(4)(A)Paying the costs of issuing bonds, paying the annual administration costs of the bonds, and paying interest on bonds.
(B)In addition, moneys in the fund or other proceeds of the sale of bonds authorized by this chapter may be used to pay principal of, or redemption premium on, interim debt issued prior to the issuance of bonds authorized by this chapter.
(b)Moneys in the fund shall be allocated as follows:
(1)One billion sixty-five million dollars ($1,065,000,000) of the proceeds of the bonds, after allocation of bond proceeds to the purposes described in paragraph (4) of subdivision (a), shall be used for the loans or grants, loan or grant implementation, and loan or grant oversight described in paragraph (1) of subdivision (a) and administrative costs.
(2)Nine hundred twenty-two million dollars ($922,000,000) of the proceeds of the bonds, after allocation of bond proceeds to the purposes described in paragraph (4) of subdivision (a), shall be used for the loans or grants, loan or grant implementation, and loan or grant oversight, as described in paragraph (2) of subdivision (a), and administrative costs.
(3)One billion five hundred million dollars ($1,500,000,000) of the proceeds of the bonds shall be awarded to cities, counties, city and counties, and tribal entities, after allocation of bond proceeds to the purposes described in paragraph (4) of subdivision (a) for grants, grant implementation, and grant oversight, as described in paragraph (3) of subdivision (a), and administrative costs. Of this amount, thirty million dollars ($30,000,000) shall be designated to tribal entities.
(4)Up to two billion eight hundred ninety-three million dollars ($2,893,000,000) of the proceeds of the bonds, after allocation of bond proceeds to the purposes of paragraph (4) of subdivision (a), shall be used for grants, grant implementation, and grant oversight, as described in paragraph (3) of subdivision (a), and administrative costs.
5965.05.(a)(1)Bonds in the total amount of six billion three hundred eighty million dollars ($6,380,000,000) not including the amount of refunding bonds issued in accordance with Section 5965.14, may be issued and sold for the purposes expressed in this chapter and to reimburse the General Obligation Bond Expense Revolving Fund pursuant to Section 16724.5 of the Government Code.
(2)The bonds, when sold, issued, and delivered, shall be and constitute a valid and binding obligation of the State of California, and the full faith and credit of the State of California is hereby pledged for the punctual payment of both the principal of, and interest on, the bonds as the principal and interest become due and payable.
(b)(1)The Treasurer shall issue and sell the bonds authorized in subdivision (a) in the amount determined by the committee to be necessary or desirable pursuant to Section 5965.08. The bonds shall be issued and sold upon the terms and conditions specified in a resolution to be adopted by the committee pursuant to Section 16731 of the Government Code.
(2)The bonds shall be issued and sold upon the terms and conditions specified in a resolution to be adopted by the committee pursuant to Section 5965.08.
5965.06.The bonds authorized by this chapter shall be prepared, executed, issued, sold, paid, and redeemed as provided in the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), as amended, from time to time, and all of the provisions of that law, as amended, apply to the bonds and to this chapter and are hereby incorporated in this chapter as though set forth in full in this chapter, except that subdivisions (a) and (b) of Section 16727 of the Government Code shall not apply.
5965.07.(a)Solely for the purpose of authorizing the issuance and sale, pursuant to the State General Obligation Bond Law, of the bonds authorized by this chapter, the Behavioral Health Infrastructure Bond Act Finance Committee is hereby created.
(b)(1)The committee consists of the Controller, the Treasurer, and the Director of Finance.
(2)Notwithstanding any other law, a member may designate a representative to act as that member in the members place, for all purposes, as though the member were personally present.
(c)(1)The Treasurer shall serve as chairperson of the committee.
(2)A majority of the committee may act for the committee.
5965.08.(a)The committee shall determine, by resolution, whether it is necessary or desirable to issue and sell bonds authorized pursuant to this chapter to carry out the actions specified in this chapter and, if so, the amount of bonds to be issued and sold.
(b)Successive issues of bonds may be authorized and sold to carry out those actions progressively, and it is not necessary that all of the bonds authorized to be issued be sold at any one time.
5965.09.(a)There shall be collected each year, and in the same manner and at the same time as other state revenue is collected, in addition to the ordinary revenues of the state, a sum in an amount required to pay the principal of, and interest on, the bonds becoming due each year.
(b)It is the duty of all officers charged by law with a duty in regard to the collection of the revenue to do and perform each and every act that is necessary to collect that additional sum.
5965.10.Notwithstanding Section 13340 of the Government Code, there is hereby continuously appropriated from the General Fund in the State Treasury, for the purposes of this chapter and without regard to fiscal years, an amount that equals the total of the following:
(a)The sum annually necessary to pay the principal of, and interest on, bonds issued and sold pursuant to this chapter, as the principal and interest become due and payable.
(b)The sum necessary to carry out Section 5965.11.
5965.11.(a)For the purpose of carrying out this chapter, the Director of Finance may authorize the withdrawal from the General Fund of an amount or amounts not to exceed the amount of the unsold bonds that have been authorized by the committee to be sold for the purpose of carrying out this chapter, excluding refunding bonds authorized pursuant to Section 5965.14 less any amount loaned pursuant to Section 5965.12 and not yet repaid, and any amount withdrawn from the General Fund pursuant to this section and not yet returned to the General Fund.
(b)Any amounts withdrawn shall be deposited in the fund.
(c)Any moneys made available under this section shall be returned to the General Fund, with interest at the rate earned by the moneys in the Pooled Money Investment Account, from proceeds received from the sale of bonds for the purpose of carrying out this chapter.
5965.12.(a)The board may request the Pooled Money Investment Board to make a loan from the Pooled Money Investment Account, in accordance with Section 16312 of the Government Code, for the purpose of carrying out this chapter.
(b)The amount of the request shall not exceed the amount of the unsold bonds that the committee has, by resolution, authorized to be sold for the purpose of carrying out this chapter, excluding refunding bonds authorized pursuant to Section 5965.14, less any amount loaned pursuant to this section and not yet repaid and withdrawn from the General Fund pursuant to Section 5965.11 and not yet returned to the General Fund.
(c)The board shall execute documents required by the Pooled Money Investment Board to obtain and repay the loan.
(d)Any amounts loaned shall be deposited in the fund to be allocated by the board in accordance with this chapter.
5965.13.All moneys deposited in the fund that are derived from premium and accrued interest on bonds sold pursuant to this chapter shall be reserved in the fund and shall be available for transfer to the General Fund as a credit to expenditures for bond interest, except that amounts derived from premium may be reserved and used to pay costs of bond issuance before any transfer to the General Fund.
5965.14.(a)The bonds issued and sold pursuant to this chapter may be refunded in accordance with Article 6 (commencing with Section 16780) of Chapter 4 of Part 3 of Division 4 of Title 2 of the Government Code, which is a part of the State General Obligation Bond Law.
(b)Approval by the voters of the state for the issuance of the bonds described in this chapter includes the approval of the issuance of bonds issued to refund bonds originally issued under this chapter or any previously issued refunding bonds.
(c)A bond refunded with the proceeds of refunding bonds, as authorized by this section, may be legally defeased to the extent permitted by law in the manner and to the extent set forth in the resolution, as amended, authorizing that refunded bond.
5965.15.(a)Notwithstanding any provision of this chapter or the State General Obligation Bond Law, if the Treasurer sells bonds pursuant to this chapter that include a bond counsel opinion to the effect that the interest on the bonds is excluded from gross income for federal tax purposes, under designated conditions, or is otherwise entitled to a federal tax advantage, the Treasurer may maintain separate accounts for the investment of bond proceeds and the investment earnings on those proceeds.
(b)The Treasurer may use or direct the use of those proceeds or earnings to pay a rebate, penalty, or other payment required under federal law or to take any other action with respect to the investment and use of those bond proceeds, required or desirable under federal law, to maintain the tax-exempt status of those bonds and to obtain any other advantage under federal law on behalf of the funds of this state.
5965.16.The proceeds from the sale of bonds authorized by this chapter are not proceeds of taxes as that term is used in Article XIIIB of the California Constitution, and the disbursement of these proceeds is not subject to the limitations imposed by that article.
5966.(a)(1)The Department of Housing and Community Development, in coordination with the Department of Veterans Affairs, shall determine the methodology and distribution of the funds provided pursuant to paragraph (1) of subdivision (b) of Section 5965.04, used for the purposes provided in paragraph (1) of subdivision (a) of Section 5965.04.
(2)The Department of Housing and Community Development and the Department of Veterans Affairs shall work in coordination pursuant to a memorandum of understanding.
(b)The Department of Housing and Community Development shall determine the methodology and distribution of the funds provided pursuant to paragraph (2) of subdivision (b) of Section 5965.04, used for the purposes provided in paragraph (2) of subdivision (a) of Section 5965.04.
5966.02.(a)(1)Notwithstanding any other law, funds allocated for the purposes specified in paragraphs (1) and (2) of subdivision (a) of Section 5965.04 shall be disbursed in accordance with subdivisions (a) to (h), inclusive, of Section 50675.1.3 of the Health and Safety Code and any associated guidelines changes to that program, as provided in the Multifamily Housing Program in Chapter 6.7 (commencing with Section 50675) of Part 2 of Division 31 of the Health and Safety Code, and this chapter, consistent with applicable law and guidance.
(2)The Department of Housing and Community Development shall issue guidance regarding implementation by July 1, 2025.
(b)In developing the methodology and distribution of funds referenced in subdivision (a) of Section 5966, the Department of Housing and Community Development shall consult with the Department of Veterans Affairs regarding supportive services plan standards and other program areas where the Department of Veterans Affairs holds expertise for the purposes specified in paragraph (1) of subdivision (a) of Section 5965.04.
5967.The Department of Health Care Services shall determine the methodology and distribution of the funds provided pursuant to paragraphs (3) and (4) of subdivision (b) of Section 5965.04, used for the purposes provided in paragraphs (3) and (4) of subdivision (a) of Section 5965.04.
5967.01.(a)Notwithstanding any other law, funds allocated for the purposes specified in paragraph (3) of subdivision (a) of Section 5965.04 shall be disbursed in accordance with the Behavioral Health Continuum Infrastructure Program (commencing with Section 5960), and this chapter, consistent with applicable law and guidance.
(b)The Department of Health Care Services shall issue guidance regarding the implementation of this article by July 1, 2025.
SEC. 5.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because a local agency or school district has the authority to levy service charges, fees, or assessments sufficient to pay for the program or level of service mandated by this act, within the meaning of Section 17556 of the Government Code.
SEC. 6.Sections 1, 2, and 3 of this act shall take effect upon the approval by the voters of the Behavioral Health Infrastructure Bond Act of 2024, as set forth in Section 4 of this act.
SEC. 7.(a)Section 4 of this act and Sections 1, 2, 14, 15, 18 to 23, inclusive, 28 to 30, inclusive, 35 to 40, inclusive, 42 to 44, inclusive, 49 to 59, inclusive, 62 to 64, inclusive, 73 to 81, inclusive, 86 to 95, inclusive, 98 to 100, inclusive, 103 to 112, inclusive, 116, and 117 of the Behavioral Health Services Act, as set forth in Senate Bill 326 of the 202324 Regular Session, shall be submitted to the voters at the March 5, 2024, statewide primary election, and shall appear on the ballot as a single measure in accordance with provisions of the Government Code and the Elections Code governing the submission of a statewide measure to the voters.
(b)Notwithstanding Sections 13115 and 13117 of the Elections Code or any other law, the single measure described in subdivision (a), shall be placed as the first measure on the March 5, 2024, statewide primary election ballot and shall be designated as Proposition 1.
(c)Notwithstanding Sections 13115 and 13117 of the Elections Code or any other law, all other measures proposed by the Legislature at the 202324 Regular Session for submission to the voters at the March 5, 2024, statewide primary election shall immediately follow Proposition 1 and be designated on the statewide primary election ballot as the next in order numerically pursuant to Section 13117 of the Elections Code.
(a)(1)Notwithstanding any other law, funds projects to provide housing pursuant to paragraph (1) or (2) of subdivision (a) of Section 5965.04 of the Welfare and Institutions Code, shall be a use by right and shall be subject to the streamlined, ministerial review process, pursuant to subdivision (b), if it meets all of the following criteria:
(A)It is located in a zone where multifamily residential use, office, retail, or parking are a principally permitted use.
(B)At least 75 percent of the perimeter of the site adjoins parcels that are developed with urban uses.
(C)It satisfies the requirements specified in subparagraphs (B) to (K), inclusive, of paragraph (6) of subdivision (a) of Section 65913.4 of the Government Code.
(D)It is not on a site or adjoined to any site where more than one-third of the square footage on the site is dedicated to industrial use.
(E)The development will meet the following objective zoning standards, objective subdivision standards, and objective design review standards:
(i)The applicable objective standards shall be those for the zone that allows residential use at a greater density between the following:
(I)The existing zoning designation for the parcel if existing zoning allows multifamily residential use.
(II)The zoning designation for the closest parcel that allows residential use at a density deemed appropriate to accommodate housing for lower income households in that jurisdiction as specified in paragraph (3) of subdivision (c) of Section 65583.2 of the Government Code.
(ii)The applicable objective standards shall be those in effect at the time that the development application is submitted to the local government pursuant to this section.
(iii)A development proposed pursuant to this section shall be eligible for the same density bonus, incentives or concessions, waivers or reductions of development standards, and parking ratios applicable to a project that meets the criteria specified in subparagraph (G) of paragraph (1) of subdivision (b) of Section 65915 of the Government Code.
(F)No housing units were acquired by eminent domain.
(G)The housing units will be in decent, safe, and sanitary condition at the time of their occupancy.
(H)The project meets the labor standards contained in Sections 65912.130 and 65912.131 of the Government Code.
(I)The project provides housing for individuals persons who meet the criteria specified in subdivision (a) of Section 5830 of the Welfare and Institutions Code and their families.
(J)Long-term covenants and restrictions require the housing units to be restricted to persons who meet the criteria specified in subdivision (a) of Section 5830 of the Welfare and Institutions Code for no fewer than 30 years.
(2)(A)For purposes of this subdivision, parcels only separated by a street or highway shall be considered to be adjoined.
(B)For purposes of this subdivision, dedicated to industrial use means any of the following:
(i)The square footage is currently being used as an industrial use.
(ii)The most recently permitted use of the square footage is an industrial use.
(iii)The site was designated for industrial use in the latest version of a local governments general plan adopted before January 1, 2022.
(b)The project shall be subject to the following streamlined, ministerial review process:
(1)(A)If the local government determines that a development submitted pursuant to this section is consistent with the objective planning standards specified in this section, it shall approve the development.
(B)If a local government determines that a development submitted pursuant to this section is in conflict with any of the objective planning standards specified in this section, it shall provide the development proponent written documentation of which standard or standards the development conflicts with, and an explanation for the reason or reasons the development conflicts with that standard or standards, within the following timeframes:
(i)Within 60 days of submission of the development proposal to the local government if the development contains 150 or fewer housing units.
(ii)Within 90 days of submission of the development proposal to the local government if the development contains more than 150 housing units.
(C)If the local government fails to provide the required documentation pursuant to subparagraph (B), the development shall be deemed to satisfy the required objective planning standards.
(D)(i)For purposes of this section, a development is consistent with the objective planning standards if there is substantial evidence that would allow a reasonable person to conclude that the development is consistent with the objective planning standards.
(ii)For purposes of this section, a development is not in conflict with the objective planning standards solely on the basis that application materials are not included, if the application contains substantial evidence that would allow a reasonable person to conclude that the development is consistent with the objective planning standards.
(E)The determination of whether a proposed project submitted pursuant to this section is or is not in conflict with the objective planning standards is not a project as defined in Section 21065 of the Public Resources Code.
(2)Design review of the development may be conducted by the local governments planning commission or any equivalent board or commission responsible for design review. That design review shall be objective and be strictly focused on assessing compliance with criteria required for streamlined, ministerial review of projects, as well as any reasonable objective design standards published and adopted by ordinance or resolution by a local jurisdiction before submittal of the development to the local government, and shall be broadly applicable to developments within the jurisdiction. That design review shall be completed as follows and shall not in any way inhibit, chill, or preclude the ministerial approval provided by this section or its effect, as applicable:
(A)Within 90 days of submittal of the development proposal to the local government pursuant to this section if the development contains 150 or fewer housing units.
(B)Within 180 days of submittal of the development proposal to the local government pursuant to this section if the development contains more than 150 housing units.
(c)Division 13 (commencing with Section 21000) of the Public Resources Code shall not apply to actions taken by the Department of Housing and Community Development, the State Department of Health Care Services, or a local agency not acting as the lead agency to provide financial assistance or insurance for the development and construction of projects built pursuant to this section.
(d)The applicant shall file a notice of exemption with the Office of Planning and Research and the county clerk of the county in which the project is located in the manner specified in subdivisions (b) and (c) of Section 21152 of the Public Resources Code.
(e)For purposes of this section, the following definitions shall apply:
(1)Objective zoning standards, objective subdivision standards, and objective design review standards mean standards that involve no personal or subjective judgment by a public official and are uniformly verifiable by reference to an external and uniform benchmark or criterion available and knowable by both the development applicant or proponent and the public official before submittal. These standards may be embodied in alternative objective land use specifications adopted by a city or county, and may include, but are not limited to, housing overlay zones, specific plans, inclusionary zoning ordinances, and density bonus ordinances.
(2)Use by right means a development project that satisfies both of the following conditions:
(A)The development project does not require a conditional use permit, planned unit development permit, or other discretionary local government review.
(B)The development project is not a project for purposes of Division 13 (commencing with Section 21000) of the Public Resources Code.
SEC. 2.Section 5960.31 is added to the Welfare and Institutions Code, to read:5960.31.(a)Notwithstanding any other law, projects defined in paragraphs (1) and (2) of subdivision (b), and funded pursuant to Section 5967.01, paragraph (3) or (4) of subdivision (b) of Section 5965.04 shall be a use by right and shall be subject to the streamlined, ministerial review process, process and filing requirement, pursuant to subdivisions (b) and (d) of Section 50675.1.5, 50675.1.5 of the Health and Safety Code, and not subject to a conditional use permit, discretionary permit, or to any other discretionary reviews or approvals, if it meets one of the following criteria: the criteria of paragraph (1) or (2) and complies with subdivisions (b) and (c).
(1)The project is a behavioral health treatment and residential setting, including, but not limited to, childrens residential crisis programs, peer respite, childrens and adult substance use disorder residential programs, recovery housing, short-term residential therapeutic program, and social rehabilitation program, and is shall be located in a zone where residential, office, retail, or parking are a principally permitted use.
(2)(A)The project is a real estate asset, as described in Section 5960.05, except for those described in paragraph (1), or in subparagraph (A) of paragraph (1) of subdivision (a) of Section 5831, that is funded pursuant to Section 5967.01, and is shall be located in a zone where residential, office, retail, or parking are a principally permitted use.
(B)This paragraph shall not be construed to limit the discretion of local jurisdictions to permit real estate assets in a zone not expressly provided in this paragraph.
(3)The project complies(b)Projects, as applicable, pursuant to this section shall comply with the core components of Housing First, as defined under subdivision (b) of Section 8255, and may include recovery housing, as defined by the United States Department of Housing and Urban Development.
(b)(c)Projects pursuant to this section shall meet the labor standards contained in Sections 65912.130 and 65912.131 of the Government Code.
(c)(d)For purposes of this section, use by right means a development project that satisfies both of the following conditions:
(1)The development project does not require a conditional use permit, planned unit development permit, or other discretionary local government review.
(2)The development project is not a project for purposes of Division 13 (commencing with Section 21000) of the Public Resources Code.
SEC. 3.Section 5960.45 of the Welfare and Institutions Code is repealed.SEC. 4.Chapter 4 (commencing with Section 5965) is added to Part 7 of Division 5 of the Welfare and Institutions Code, to read:4.Behavioral Health Infrastructure Bond Act of 20245965.This chapter shall be known, and may be cited, as the Behavioral Health Infrastructure Bond Act of 2024.
5965.01.The people of California find and declare all of the following:(a)The intent of the bonds issued under this act is to help provide appropriate care facilities for Californians living with serious mental health conditions and substance use disorders who need a higher level of care, which may include long-term residential support services.(b)The bonds would fund the development of an array of voluntary, unlocked, community-based treatment and residential care settings. These settings represent key sublevels of care that are necessary to support individuals with the most complex behavioral health conditions to succeed as they journey through the care continuum from acute settings to residential settings to supported housing settings.(c)There are over 10,000 Californian veterans experiencing homelessness. Over 50 percent of homeless veterans suffer from mental health issues and 70 percent are affected by substance use disorders. The bond would also provide funding for housing of veterans experiencing homelessness who are living with behavioral health challenges.(d)The data is alarming. In 2022, 1 in 20 adults in California is living with a serious mental illness (SMI), representing a nearly 50-percent increase in the last decade. One in 13 children in California has a serious emotional disturbance (SED), which is more common in children in low-income families. Thirty percent of youth 12 to 24 years of age, inclusive, experience serious psychological distress. One in 10 Californians meet the criteria for a substance use disorder (SUD) and the rate of SUDs among youth 18 to 25 years of age, inclusive, is nearly twice that of adults and more than three times that of adolescents.(e)Veterans have a higher rate of suicide than the general population and experience higher rates of mental illness or substance use disorder.(f)Meeting the growing demand for behavioral health care has exposed strained infrastructure. The limited availability of clinically appropriate, culturally competent, community-based care facilities and residential settings to support rehabilitation and recovery contributes to the growing crisis of homelessness and incarceration among those living with an SMI and an SUD. Research in 2021 indicates that the state has a shortage of over 2,700 subacute and nearly 3,000 community residential beds.(g)The state will continue to invest in needed infrastructure through establishing the Behavioral Health Infrastructure Bond Act of 2024 and building community-based treatment and residential care settings. Funds will also support housing for veterans experiencing homelessness with behavioral health needs.(h)Efforts to streamline the process for approving projects and renovating or building new facilities to accelerate the delivery of care in residential settings made available through additional Behavioral Health Services Act and bond financing is a priority.5965.01.The purposes and intent in enacting this act are as follows:
(a)Bonds issued under this act are to develop an array of treatment, residential care settings, and supportive housing to help provide appropriate care facilities for Californians experiencing mental health conditions and substance use disorders.
(b)The bond will dedicate funding for veterans with a behavioral health challenge or substance use disorder and at risk of experiencing homelessness.
(c)Efforts to streamline the process for approving projects and renovating or building new facilities to accelerate the delivery of care in residential settings made available through additional Behavioral Health Services Act and bond financing is a priority.
5965.02.As used in this chapter, the following terms have the following meanings:
(a)Act means the Behavioral Health Infrastructure Bond Act of 2024 (Chapter 4 (commencing with Section 5965)).
(b)Behavioral health challenge includes, but is not limited to, serious mental illness, as described in subdivision (c) or (d) of Section 14184.402, or a substance use disorder, as described in Section 5891.5.
(c)Board means, with respect to the bond proceeds referenced in paragraph (3) paragraphs (3) and (4) of subdivision (b) of Section 5965.04, and with respect to and for requests up to the amount specified for bond proceeds referenced in paragraph (3) paragraphs (3) and (4) of subdivision (b) of Section 5965.04, for purposes of Section 5965.12 of this code and Section 16726 of the Government Code, the State Department of Health Care Services, and with respect to bond proceeds referenced in paragraphs (1) and (2) of subdivision (b) of Section 5965.04, and, with respect to and for requests up to the amount specified for bond proceeds referenced in paragraphs (1) and (2) of subdivision (b) of Section 5965.04, for purposes of Section 5965.12 of this code and Section 16726 of the Government Code, the Department of Housing and Community Development.
(d)Committee means the Behavioral Health Infrastructure Bond Act Finance Committee created pursuant to Section 5965.07.
(e)Fund means the Behavioral Health Infrastructure Fund created pursuant to Section 5965.03.
(f)State General Obligation Bond Law means the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), as it may be amended.
(g)Target population means a person described in subdivision (c) or (d) of Section 14184.402, or a person with a substance use disorder, as described in Section 5891.5, except that enrollment in Medi-Cal or in any other health plan shall not be a condition for accessing housing or continuing to be housed.
(h)Veteran means a person who served in the active military, naval, or air service, and who was discharged or released under conditions other than dishonorable.
5965.03.(a)The proceeds of interim debt and bonds, excluding proceeds used directly to repay interim debt and excluding bonds issued in accordance with Section 5965.14, issued and sold pursuant to this chapter shall be deposited in the Behavioral Health Infrastructure Fund, which is hereby created in the State Treasury.
(b)All moneys in the fund, notwithstanding Section 13340 of the Government Code, are hereby continuously appropriated without respect to fiscal years for the purposes of this chapter.
(c)Bonds shall be issued and delivered in the amount determined by the committee to be necessary or desirable pursuant to Section 5965.08.
5965.04.(a)Moneys in the fund shall be used for any of the following purposes:
(1)Making loans or grants administered by the Department of Housing and Community Development to eligible entities specified under Section 50675.1.3 of the Health and Safety Code or loans to development sponsors as defined under Section 50675.2 of the Health and Safety Code to acquire capital assets for the conversion or conversion, rehabilitation, or new construction of permanent supportive housing, including scattered site projects, for veterans or their households, who are homeless, chronically homeless, or are at risk of homelessness, as defined by Part 578.3 of Title 24 of the Code of Federal Regulations, and meet the criteria of the target population.
(2)Making loans or grants administered by the Department of Housing and Community Development to eligible entities specified under Section 50675.1.3 of the Health and Safety Code or loans to development sponsors as defined under Section 50675.2 of the Health and Safety Code to acquire capital assets for the conversion or conversion, rehabilitation, or new construction of permanent supportive housing, including scattered site projects for persons who are homeless, chronically homeless, or are at risk of homelessness, as defined by Part 578.3 of Title 24 of the Code of Federal Regulations, and are living with a behavioral health challenge.
(3)Making grants administered by the State Department of Health Care Services, as specified under the Behavioral Health Continuum Infrastructure Program, Section 5960, for either the acquisition of capital assets for, or the construction and rehabilitation of, or both, community-based treatment settings and residential care settings that are voluntary, unlocked, and create step downs from higher acuity levels of care along the behavioral health care continuum. Program to eligible entities specified pursuant to Chapter 1 (commencing with Section 5960) to construct, acquire, and rehabilitate real estate assets or to invest in needed infrastructure to expand the continuum of behavioral health treatment resources to build new capacity or expand existing capacity for short-term crisis stabilization, acute and subacute care, crisis residential, community-based mental health residential, substance use disorder residential, peer respite, community and outpatient behavioral health services, and other clinically enriched longer term treatment and rehabilitation options for persons with behavioral health disorders in the least restrictive and least costly setting.
(4)(A)Paying the costs of issuing bonds, paying the annual administration costs of the bonds, and paying interest on bonds.
(B)In addition, moneys in the fund or other proceeds of the sale of bonds authorized by this chapter may be used to pay principal of, or redemption premium on, interim debt issued prior to the issuance of bonds authorized by this chapter.
(b)Moneys in the fund shall be allocated as follows:
(1)Eight hundred sixty-five million dollars ($865,000,000) One billion sixty-five million dollars ($1,065,000,000) of the proceeds of the bonds, after allocation of bond proceeds to the purposes described in paragraph (4) of subdivision (a), shall be used for the loans or grants, loan or grant implementation, and loan or grant oversight described in paragraph (1) of subdivision (a) and administrative costs.
(2)Nine hundred twenty-two million dollars ($922,000,000) of the proceeds of the bonds, after allocation of bond proceeds to the purposes described in paragraph (4) of subdivision (a), shall be used for the loans or grants, loan or grant implementation, and loan or grant oversight, as described in paragraph (2) of subdivision (a), and administrative costs.
(3)One billion five hundred million dollars ($1,500,000,000) of the proceeds of the bonds shall be awarded to cities, counties, city and counties, and tribal entities, after allocation of bond proceeds to the purposes described in paragraph (4) of subdivision (a) for grants, grant implementation, and grant oversight, as described in paragraph (3) of subdivision (a), and administrative costs. Of this amount, thirty million dollars ($30,000,000) shall be designated to tribal entities.
(3)The remaining proceeds of the bonds,(4)Up to two billion eight hundred ninety-three million dollars ($2,893,000,000) of the proceeds of the bonds, after allocation of bond proceeds for purposes described in paragraphs (1), (2), and (4) of subdivision (a), to the purposes of paragraph (4) of subdivision (a), shall be used for grants, grant implementation, and grant oversight, as described in paragraph (3) of subdivision (a), and administrative costs.
5965.05.(a)(1)Bonds in the total amount of four billion six hundred eighty million dollars ($4,680,000,000), six billion three hundred eighty million dollars ($6,380,000,000) not including the amount of refunding bonds issued in accordance with Section 5965.14, may be issued and sold for the purposes expressed in this chapter and to reimburse the General Obligation Bond Expense Revolving Fund pursuant to Section 16724.5 of the Government Code.
(2)The bonds, when sold, issued, and delivered, shall be and constitute a valid and binding obligation of the State of California, and the full faith and credit of the State of California is hereby pledged for the punctual payment of both the principal of, and interest on, the bonds as the principal and interest become due and payable.
(b)(1)The Treasurer shall issue and sell the bonds authorized in subdivision (a) in the amount determined by the committee to be necessary or desirable pursuant to Section 5965.08. The bonds shall be issued and sold upon the terms and conditions specified in a resolution to be adopted by the committee pursuant to Section 16731 of the Government Code.
(2)The bonds shall be issued and sold upon the terms and conditions specified in a resolution to be adopted by the committee pursuant to Section 5965.08.
5965.06.The bonds authorized by this chapter shall be prepared, executed, issued, sold, paid, and redeemed as provided in the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), as amended, from time to time, and all of the provisions of that law, as amended, apply to the bonds and to this chapter and are hereby incorporated in this chapter as though set forth in full in this chapter, except that subdivisions (a) and (b) of Section 16727 of the Government Code shall not apply.
5965.07.(a)Solely for the purpose of authorizing the issuance and sale, pursuant to the State General Obligation Bond Law, of the bonds authorized by this chapter, the Behavioral Health Infrastructure Bond Act Finance Committee is hereby created.
(b)(1)The committee consists of the Controller, the Treasurer, and the Director of Finance.
(2)Notwithstanding any other law, a member may designate a representative to act as that member in the members place, for all purposes, as though the member were personally present.
(c)(1)The Treasurer shall serve as chairperson of the committee.
(2)A majority of the committee may act for the committee.
5965.08.(a)The committee shall determine, by resolution, whether it is necessary or desirable to issue and sell bonds authorized pursuant to this chapter to carry out the actions specified in this chapter and, if so, the amount of bonds to be issued and sold.
(b)Successive issues of bonds may be authorized and sold to carry out those actions progressively, and it is not necessary that all of the bonds authorized to be issued be sold at any one time.
5965.09.(a)There shall be collected each year, and in the same manner and at the same time as other state revenue is collected, in addition to the ordinary revenues of the state, a sum in an amount required to pay the principal of, and interest on, the bonds becoming due each year.
(b)It is the duty of all officers charged by law with a duty in regard to the collection of the revenue to do and perform each and every act that is necessary to collect that additional sum.
5965.10.Notwithstanding Section 13340 of the Government Code, there is hereby continuously appropriated from the General Fund in the State Treasury, for the purposes of this chapter and without regard to fiscal years, an amount that equals the total of the following:
(a)The sum annually necessary to pay the principal of, and interest on, bonds issued and sold pursuant to this chapter, as the principal and interest become due and payable.
(b)The sum necessary to carry out Section 5965.11.
5965.11.(a)For the purpose of carrying out this chapter, the Director of Finance may authorize the withdrawal from the General Fund of an amount or amounts not to exceed the amount of the unsold bonds that have been authorized by the committee to be sold for the purpose of carrying out this chapter, excluding refunding bonds authorized pursuant to Section 5965.14 less any amount loaned pursuant to Section 5965.12 and not yet repaid, and any amount withdrawn from the General Fund pursuant to this section and not yet returned to the General Fund.
(b)Any amounts withdrawn shall be deposited in the fund.
(c)Any moneys made available under this section shall be returned to the General Fund, with interest at the rate earned by the moneys in the Pooled Money Investment Account, from proceeds received from the sale of bonds for the purpose of carrying out this chapter.
5965.12.(a)The board may request the Pooled Money Investment Board to make a loan from the Pooled Money Investment Account, in accordance with Section 16312 of the Government Code, for the purpose of carrying out this chapter.
(b)The amount of the request shall not exceed the amount of the unsold bonds that the committee has, by resolution, authorized to be sold for the purpose of carrying out this chapter, excluding refunding bonds authorized pursuant to Section 5965.14, less any amount loaned pursuant to this section and not yet repaid and withdrawn from the General Fund pursuant to Section 5965.11 and not yet returned to the General Fund.
(c)The board shall execute documents required by the Pooled Money Investment Board to obtain and repay the loan.
(d)Any amounts loaned shall be deposited in the fund to be allocated by the board in accordance with this chapter.
5965.13.All moneys deposited in the fund that are derived from premium and accrued interest on bonds sold pursuant to this chapter shall be reserved in the fund and shall be available for transfer to the General Fund as a credit to expenditures for bond interest, except that amounts derived from premium may be reserved and used to pay costs of bond issuance before any transfer to the General Fund.
5965.14.(a)The bonds issued and sold pursuant to this chapter may be refunded in accordance with Article 6 (commencing with Section 16780) of Chapter 4 of Part 3 of Division 4 of Title 2 of the Government Code, which is a part of the State General Obligation Bond Law.
(b)Approval by the voters of the state for the issuance of the bonds described in this chapter includes the approval of the issuance of bonds issued to refund bonds originally issued under this chapter or any previously issued refunding bonds.
(c)A bond refunded with the proceeds of refunding bonds, as authorized by this section, may be legally defeased to the extent permitted by law in the manner and to the extent set forth in the resolution, as amended, authorizing that refunded bond.
5965.15.(a)Notwithstanding any provision of this chapter or the State General Obligation Bond Law, if the Treasurer sells bonds pursuant to this chapter that include a bond counsel opinion to the effect that the interest on the bonds is excluded from gross income for federal tax purposes, under designated conditions, or is otherwise entitled to a federal tax advantage, the Treasurer may maintain separate accounts for the investment of bond proceeds and the investment earnings on those proceeds.
(b)The Treasurer may use or direct the use of those proceeds or earnings to pay a rebate, penalty, or other payment required under federal law or to take any other action with respect to the investment and use of those bond proceeds, required or desirable under federal law, to maintain the tax-exempt status of those bonds and to obtain any other advantage under federal law on behalf of the funds of this state.
5965.16.The proceeds from the sale of bonds authorized by this chapter are not proceeds of taxes as that term is used in Article XIIIB of the California Constitution, and the disbursement of these proceeds is not subject to the limitations imposed by that article.
5966.(a)(1)The Department of Housing and Community Development, in coordination with the Department of Veterans Affairs, shall determine the methodology and distribution of the funds provided pursuant to paragraph (1) of subdivision (b) of Section 5965.04, used for the purposes provided in paragraph (1) of subdivision (a) of Section 5965.04.
(2)The Department of Housing and Community Development and the Department of Veterans Affairs shall work in coordination pursuant to a memorandum of understanding.
(b)The Department of Housing and Community Development shall determine the methodology and distribution of the funds provided pursuant to paragraph (2) of subdivision (b) of Section 5965.04, used for the purposes provided in paragraph (2) of subdivision (a) of Section 5965.04.
5966.02.(a)(1)Notwithstanding any other law, funds allocated for the purposes specified in paragraphs (1) and (2) of subdivision (a) of Section 5965.04 shall be disbursed in accordance with subdivisions (a) to (h), inclusive, of Section 50675.1.3 of the Health and Safety Code and any associated guidelines changes to that program, as provided in the Multifamily Housing Program in Chapter 6.7 (commencing with Section 50675) of Part 2 of Division 31 of the Health and Safety Code, and this chapter, consistent with applicable law and guidance.
(2)The Department of Housing and Community Development shall issue guidance regarding implementation by July 1, 2025.
(b)In developing the guidance methodology and distribution of funds referenced in subdivision (a) of Section 5966, the Department of Housing and Community Development shall consult with the Department of Veterans Affairs regarding supportive services plan standards and other program areas where the Department of Veterans Affairs holds expertise for the purposes specified in paragraph (1) of subdivision (a) of Section 5965.04.
5967.The Department of Health Care Services shall determine the methodology and distribution of the funds provided pursuant to paragraph (3) paragraphs (3) and (4) of subdivision (b) of Section 5965.04, used for the purposes provided in paragraphs (3) and (4) of subdivision (a) of Section 5965.04.
5967.01.(a)Notwithstanding any other law, funds allocated for the purposes specified in paragraph (3) of subdivision (a) of Section 5965.04 shall be disbursed in accordance with the Behavioral Health Continuum Infrastructure Program (commencing with Section 5960), and this chapter, consistent with applicable law and guidance.
(b)The Department of Health Care Services shall issue guidance regarding the implementation of this article by July 1, 2025.
SEC. 5.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because a local agency or school district has the authority to levy service charges, fees, or assessments sufficient to pay for the program or level of service mandated by this act, within the meaning of Section 17556 of the Government Code.
SEC. 6.Sections 1, 2, and 4 3 of this act shall take effect upon the approval by the voters of the Behavioral Health Infrastructure Bond Act of 2024, as set forth in Section 4 of this act.
SEC. 7.(a)Section 4 of this act and Sections ____ 1, 2, 14, 15, 18 to 23, inclusive, 28 to 30, inclusive, 35 to 40, inclusive, 42 to 44, inclusive, 49 to 59, inclusive, 62 to 64, inclusive, 73 to 81, inclusive, 86 to 95, inclusive, 98 to 100, inclusive, 103 to 112, inclusive, 116, and 117 of the Behavioral Health Services Act, as set forth in Senate Bill 326 of the 202324 Regular Session, shall be submitted to the voters at the March 5, 2024, statewide primary election, and shall appear on the ballot as a single measure in accordance with provisions of the Government Code and the Elections Code governing the submission of a statewide measure to the voters.
(b)Notwithstanding Sections 13115 and 13117 of the Elections Code or any other law, the single measure described in subdivision (a), shall be placed as the first measure on the March 5, 2024, statewide primary election ballot and shall be designated as Proposition 1.
(c)Notwithstanding Sections 13115 and 13117 of the Elections Code or any other law, all other measures proposed by the Legislature at the 202324 Regular Session for submission to the voters at the March 5, 2024, statewide primary election shall immediately follow Proposition 1 and be designated on the statewide primary election ballot as the next in order numerically pursuant to Section 13117 of the Elections Code.
(a)(1)Notwithstanding any other law, funds to provide housing pursuant to paragraph (1) or (2) of subdivision (a) of Section 5965.04 of the Welfare and Institutions Code, shall be a use by right and shall be subject to the streamlined, ministerial review process, pursuant to subdivision (b), if it meets all of the following criteria:
(A)It is located in a zone where multifamily residential use, office, retail, or parking are a principally permitted use.
(B)At least 75 percent of the perimeter of the site adjoins parcels that are developed with urban uses.
(C)It satisfies the requirements specified in subparagraphs (B) to (K), inclusive, of paragraph (6) of subdivision (a) of Section 65913.4 of the Government Code.
(D)It is not on a site or adjoined to any site where more than one-third of the square footage on the site is dedicated to industrial use.
(E)The development will meet the following objective zoning standards, objective subdivision standards, and objective design review standards:
(i)The applicable objective standards shall be those for the zone that allows residential use at a greater density between the following:
(I)The existing zoning designation for the parcel if existing zoning allows multifamily residential use.
(II)The zoning designation for the closest parcel that allows residential use at a density deemed appropriate to accommodate housing for lower income households in that jurisdiction as specified in paragraph (3) of subdivision (c) of Section 65583.2 of the Government Code.
(ii)The applicable objective standards shall be those in effect at the time that the development application is submitted to the local government pursuant to this section.
(iii)A development proposed pursuant to this section shall be eligible for the same density bonus, incentives or concessions, waivers or reductions of development standards, and parking ratios applicable to a project that meets the criteria specified in subparagraph (G) of paragraph (1) of subdivision (b) of Section 65915 of the Government Code.
(F)No housing units were acquired by eminent domain.
(G)The housing units will be in decent, safe, and sanitary condition at the time of their occupancy.
(H)The project meets the labor standards contained in Sections 65912.130 and 65912.131 of the Government Code.
(I)The project provides housing for individuals who meet the criteria specified in subdivision (a) of Section 5830 and their families.
(J)Long-term covenants and restrictions require the housing units to be restricted to persons who meet the criteria specified in subdivision (a) for no fewer than 30 years.
(2)(A)For purposes of this subdivision, parcels only separated by a street or highway shall be considered to be adjoined.
(B)For purposes of this subdivision, dedicated to industrial use means any of the following:
(i)The square footage is currently being used as an industrial use.
(ii)The most recently permitted use of the square footage is an industrial use.
(iii)The site was designated for industrial use in the latest version of a local governments general plan adopted before January 1, 2022.
(b)The project shall be subject to the following streamlined, ministerial review process:
(1)(A)If the local government determines that a development submitted pursuant to this section is consistent with the objective planning standards specified in this section, it shall approve the development.
(B)If a local government determines that a development submitted pursuant to this section is in conflict with any of the objective planning standards specified in this section, it shall provide the development proponent written documentation of which standard or standards the development conflicts with, and an explanation for the reason or reasons the development conflicts with that standard or standards, within the following timeframes:
(i)Within 60 days of submission of the development proposal to the local government if the development contains 150 or fewer housing units.
(ii)Within 90 days of submission of the development proposal to the local government if the development contains more than 150 housing units.
(C)If the local government fails to provide the required documentation pursuant to subparagraph (B), the development shall be deemed to satisfy the required objective planning standards.
(D)(i)For purposes of this section, a development is consistent with the objective planning standards if there is substantial evidence that would allow a reasonable person to conclude that the development is consistent with the objective planning standards.
(ii)For purposes of this section, a development is not in conflict with the objective planning standards solely on the basis that application materials are not included, if the application contains substantial evidence that would allow a reasonable person to conclude that the development is consistent with the objective planning standards.
(E)The determination of whether a proposed project submitted pursuant to this section is or is not in conflict with the objective planning standards is not a project as defined in Section 21065 of the Public Resources Code.
(2)Design review of the development may be conducted by the local governments planning commission or any equivalent board or commission responsible for design review. That design review shall be objective and be strictly focused on assessing compliance with criteria required for streamlined, ministerial review of projects, as well as any reasonable objective design standards published and adopted by ordinance or resolution by a local jurisdiction before submittal of the development to the local government, and shall be broadly applicable to developments within the jurisdiction. That design review shall be completed as follows and shall not in any way inhibit, chill, or preclude the ministerial approval provided by this section or its effect, as applicable:
(A)Within 90 days of submittal of the development proposal to the local government pursuant to this section if the development contains 150 or fewer housing units.
(B)Within 180 days of submittal of the development proposal to the local government pursuant to this section if the development contains more than 150 housing units.
(c)Division 13 (commencing with Section 21000) of the Public Resources Code shall not apply to actions taken by the Department of Housing and Community Development, the State Department of Health Care Services, or a local agency not acting as the lead agency to provide financial assistance or insurance for the development and construction of projects built pursuant to this section.
(d)The applicant shall file a notice of exemption with the Office of Planning and Research and the county clerk of the county in which the project is located in the manner specified in subdivisions (b) and (c) of Section 21152 of the Public Resources Code.
(e)For purposes of this section, the following definitions shall apply:
(1)Objective zoning standards, objective subdivision standards, and objective design review standards mean standards that involve no personal or subjective judgment by a public official and are uniformly verifiable by reference to an external and uniform benchmark or criterion available and knowable by both the development applicant or proponent and the public official before submittal. These standards may be embodied in alternative objective land use specifications adopted by a city or county, and may include, but are not limited to, housing overlay zones, specific plans, inclusionary zoning ordinances, and density bonus ordinances.
(2)Use by right means a development project that satisfies both of the following conditions:
(A)The development project does not require a conditional use permit, planned unit development permit, or other discretionary local government review.
(B)The development project is not a project for purposes of Division 13 (commencing with Section 21000) of the Public Resources Code.
SEC. 2.Section 5960.31 is added to the Welfare and Institutions Code, to read:5960.31.(a)Notwithstanding any other law, projects defined in paragraphs (1) and (2) of subdivision (b), and funded pursuant to Section 5967.01, shall be a use by right and shall be subject to the streamlined, ministerial review process, pursuant to subdivisions (b) and (d) of Section 50675.1.5, and not subject to a conditional use permit, discretionary permit, or to any other discretionary reviews or approvals, if it meets one of the following criteria:
(1)The project is a behavioral health treatment and residential setting, including, but not limited to, childrens residential crisis programs, peer respite, childrens and adult substance use disorder residential programs, recovery housing, short-term residential therapeutic program, and social rehabilitation program, and is located in a zone where residential, office, retail, or parking are a principally permitted use.
(2)(A)The project is a real estate asset, as described in Section 5960.05, except for those described in paragraph (1), or in subparagraph (A) of paragraph (1) of subdivision (a) of Section 5831, that is funded pursuant to Section 5967.01, and is located in a zone where residential, office, retail, or parking are a principally permitted use.
(B)This paragraph shall not be construed to limit the discretion of local jurisdictions to permit real estate assets in a zone not expressly provided in this paragraph.
(3)The project complies with the core components of Housing First, as defined under subdivision (b) of Section 8255, and may include recovery housing, as defined by the United States Department of Housing and Urban Development.
(b)Projects pursuant to this section shall meet the labor standards contained in Sections 65912.130 and 65912.131 of the Government Code.
(c)For purposes of this section, use by right means a development project that satisfies both of the following conditions:
(1)The development project does not require a conditional use permit, planned unit development permit, or other discretionary local government review.
(2)The development project is not a project for purposes of Division 13 (commencing with Section 21000) of the Public Resources Code.
SEC. 3.Section 5960.45 of the Welfare and Institutions Code is repealed.5960.45.This chapter shall remain in effect only until January, 1, 2027, and as of that date is repealed.SECTION 1.SEC. 4.Chapter 4 (commencing with Section 5965) is added to Part 7 of Division 5 of the Welfare and Institutions Code, to read:4.Behavioral Health Infrastructure Bond Act of 2023 20245965.This chapter shall be known, and may be cited, as the Behavioral Health Infrastructure Bond Act of 2023. 2024.
5965.01.The people of California find and declare all of the following:
(a)The intent of the bonds issued under this act is to help provide appropriate care options facilities for Californians living with serious mental health conditions and substance use disorders who need a higher level of care, which may include long-term residential support services.
(b)The bonds would fund the development of an array of voluntary, unlocked, community-based treatment and residential care settings. These settings represent key sublevels of care that are necessary to support individuals with the most complex behavioral health conditions to succeed as they journey through the care continuum from acute settings to residential settings to supported housing settings.
(c)There are over 10,000 Californian veterans experiencing homelessness. Over 50 percent of homeless veterans suffer from mental health issues and 70 percent are affected by substance use disorders. The bond would also provide funding for housing of veterans experiencing homelessness who are living with behavioral health challenges.
(d)The data is alarming. In 2022, 1 in 20 adults in California is living with a serious mental illness (SMI), representing a nearly 50-percent increase in the last decade. One in 13 children in California has a serious emotional disturbance (SED), which is more common in children in low-income families. Thirty percent of youth 12 to 24 years of age, inclusive, experience serious psychological distress. One in 10 Californians meet the criteria for a substance use disorder (SUD) and the rate of SUDs among youth 18 to 25 years of age, inclusive, is nearly twice that of adults and more than three times that of adolescents.
(e)Veterans have a higher rate of suicide than the general population and experience higher rates of mental illness or substance use disorder. In 2020, there were over 10,000 Californian veterans experiencing homelessness.
(f)Meeting the growing demand for behavioral health care has exposed strained infrastructure. The limited availability of clinically appropriate, culturally competent, community-based care facilities and residential settings to support rehabilitation and recovery contributes to the growing crisis of homelessness and incarceration among those living with an SMI and an SUD. Research in 2021 indicates that the state has a shortage of over 2,700 subacute and nearly 3,000 community residential beds.
(g)The state will continue to invest in needed infrastructure through establishing the Behavioral Health Infrastructure Bond Act of 2023 2024 and building community-based treatment and residential care settings. Funds will also support housing for veterans experiencing homelessness with behavioral health needs.
(h)Efforts to streamline the process for approving projects and renovating or building new facilities to accelerate the delivery of care in residential settings made available through additional Behavioral Health Services Act and bond financing is a priority.
5965.02.As used in this chapter, the following terms have the following meanings:
(a)Act means the Behavioral Health Infrastructure Bond Act of 2023 2024 (Chapter 4 (commencing with Section 5965)).
(b)Behavioral health challenge includes, but is not limited to, serious mental illness, as described in subdivision (c) or (d) of Section 14184.402, or a substance use disorder, as described in Section 5891.5.
(b)(c)Board means the State Department of Health Care Services, means, with respect to the bond proceeds referenced in paragraph (2) (3) of subdivision (b) of Section 5965.04, and with respect to and for requests up to the amount specified for bond proceeds referenced in paragraph (3) of subdivision (b) of Section 5965.04, for purposes of Section 5965.12 of this code and Section 16726 of the Government Code, the State Department of Health Care Services, and the Department of Housing and Community Development, with respect to bond proceeds referenced in paragraph (1) paragraphs (1) and (2) of subdivision (b) of Section 5965.04, and either the State Department of Health Care Services, with respect to and for requests up to the amount specified for bond proceeds referenced in paragraph (2) of subdivision (b) of Section 5965.04, or the Department of Housing and Community Development, and, with respect to and for requests up to the amount specified for bond proceeds referenced in paragraph (1) paragraphs (1) and (2) of subdivision (b) of Section 5965.04, for purposes of Section 5965.12 of this code and Section 16726 of the Government Code. Code, the Department of Housing and Community Development.
(c)(d)Committee means the Behavioral Health Infrastructure Act Finance Committee created pursuant to Section 5965.07.
(d)(e)Fund means the Behavioral Health Infrastructure Fund created pursuant to Section 5965.03.
(e)(f)State General Obligation Bond Law means the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), as it may be amended.
(g)Target population means a person described in subdivision (c) or (d) of Section 14184.402, or a person with a substance use disorder, as described in Section 5891.5, except that enrollment in Medi-Cal or in any other health plan shall not be a condition for accessing housing or continuing to be housed.
(h)Veteran means a person who served in the active military, naval, or air service, and who was discharged or released under conditions other than dishonorable.
5965.03.(a)The proceeds of interim debt and bonds, excluding proceeds used directly to repay interim debt and excluding bonds issued in accordance with Section 5965.14, issued and sold pursuant to this chapter shall be deposited in the Behavioral Health Infrastructure Fund, which is hereby created in the State Treasury.
(b)All moneys in the fund, notwithstanding Section 13340 of the Government Code, are hereby continuously appropriated without respect to fiscal years for the purposes of this chapter.
(c)Bonds shall be issued and delivered in the amount determined by the committee to be necessary or desirable pursuant to Section 5965.08.
5965.035.(a)An eligible applicant that is allocated funds for a grant program pursuant to this chapter shall not use more than 5 percent of the funds allocated for the program to pay the administrative costs of that program.(b)Eligible administrative costs will be determined by the State Department of Health Care Services for grants administered under paragraph (1) of subdivision (a) of Section 5965.04 and by the Department of Housing and Community Development under paragraph (2) of subdivision (a) of Section 5965.04.5965.04.(a)Moneys in the fund shall be used for all any of the following purposes:
(1)Making loans or grants administered by the State Department of Health Care Services for the acquisition of capital assets for, and the construction and rehabilitation of, unlocked, voluntary, and community-based treatment settings and residential care settings. Department of Housing and Community Development to eligible entities specified under Section 50675.1.3 of the Health and Safety Code or loans to development sponsors as defined under Section 50675.2 of the Health and Safety Code to acquire capital assets for the conversion or construction of permanent supportive housing, including scattered site projects, for veterans or their households, who are homeless, chronically homeless, or are at risk of homelessness, as defined by Part 578.3 of Title 24 of the Code of Federal Regulations, and meet the criteria of the target population.
(2)Making loans or grants administered by the Department of Housing and Community Development to eligible entities specified under Section 50675.1.3 of the Health and Safety Code or loans to development sponsors as defined under Section 50675.2 of the Health and Safety Code to acquire capital assets for the conversion or construction of permanent supportive housing, including scattered site projects for persons who are homeless, chronically homeless, or are at risk of homelessness, as defined by Part 578.3 of Title 24 of the Code of Federal Regulations, and are living with a behavioral health challenge.
(2)(3)Making grants administered by the Department of Housing and Community Development to acquire capital assets for, and to construct and rehabilitate housing for, veterans and others who are experiencing homelessness or are at risk of homelessness and are living with a behavioral health challenge, as defined in subdivision (b) of Section 5962.01. the State Department of Health Care Services, as specified under the Behavioral Health Continuum Infrastructure Program, Section 5960, for either the acquisition of capital assets for, or the construction and rehabilitation of, or both, community-based treatment settings and residential care settings that are voluntary, unlocked, and create step downs from higher acuity levels of care along the behavioral health care continuum.
(3)Paying general administrative costs of the board, not to exceed 3 percent of the net proceeds of each sale of bonds.(4)(A)Paying the costs of issuing bonds, paying the annual administration costs of the bonds, and paying interest on bonds.
(B)In addition, moneys in the fund or other proceeds of the sale of bonds authorized by this chapter may be used to pay principal of, or redemption premium on, interim debt issued prior to the issuance of bonds authorized by this chapter.
(b)Moneys in the fund shall be allocated as follows:
(1)Up to eight Eight hundred sixty-five million dollars ($865,000,000) of the proceeds of the bonds, after allocation of bond proceeds to the purposes described in paragraphs (3) and paragraph (4) of subdivision (a), shall be used for the loans or grants, grant implementation, and grant oversight described in paragraph (2) (1) of subdivision (a). Subdivisions (a) and (b) of Section 16727 of the Government Code shall not apply to the allocation of these proceeds. (a) and administrative costs.
(2)Nine hundred twenty-two million dollars ($922,000,000) of the proceeds of the bonds, after allocation of bond proceeds to the purposes described in paragraph (4) of subdivision (a), shall be used for the loans or grants, grant implementation, and grant oversight, as described in paragraph (2) of subdivision (a), and administrative costs.
(2)(3)The remaining proceeds of the bonds, after allocation of bond proceeds for purposes described in paragraphs (2) to (4), inclusive, (1), (2), and (4) of subdivision (a), shall be used for grants, grant implementation, and grant oversight, as described in paragraph (1) (3) of subdivision (a), and for grant implementation oversight. administrative costs.
(c)(1)A housing project funded, in whole or in part, pursuant to this section shall be a use by right subject to a streamlined, ministerial review pursuant to Section 65912.114 of the Government Code, notwithstanding subdivision (i) of that section.(2)A project proponent shall require all contractors and subcontractors performing work on the project to pay prevailing wages for any proposed rehabilitation, construction, or major alterations in accordance with Chapter 1 (commencing with Section 1720) of Part 7 of Division 2 of the Labor Code.(3)A project complies with Sections 65912.130 and 65912.131 of the Government Code if it is 50 or more housing units.5965.05.(a)(1)Bonds in the total amount of four billion six hundred eighty million dollars ($4,680,000,000), not including the amount of refunding bonds issued in accordance with Section 5965.14, may be issued and sold for the purposes expressed in this chapter and to reimburse the General Obligation Bond Expense Revolving Fund pursuant to Section 16724.5 of the Government Code.
(2)The bonds, when sold, issued, and delivered, shall be and constitute a valid and binding obligation of the State of California, and the full faith and credit of the State of California is hereby pledged for the punctual payment of both the principal of, and interest on, the bonds as the principal and interest become due and payable.
(b)(1)The Treasurer shall issue and sell the bonds authorized in subdivision (a) in the amount determined by the committee to be necessary or desirable pursuant to Section 5965.08. The bonds shall be issued and sold upon the terms and conditions specified in a resolution to be adopted by the committee pursuant to Section 16731 of the Government Code.
(2)The bonds shall be issued and sold upon the terms and conditions specified in a resolution to be adopted by the committee pursuant to Section 5965.08.
5965.06.The bonds authorized by this chapter shall be prepared, executed, issued, sold, paid, and redeemed as provided in the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), as amended, from time to time, and all of the provisions of that law, as amended, apply to the bonds and to this chapter and are hereby incorporated in this chapter as though set forth in full in this chapter. chapter, except that subdivisions (a) and (b) of Section 16727 of the Government Code shall not apply.
5965.07.(a)Solely for the purpose of authorizing the issuance and sale, pursuant to the State General Obligation Bond Law, of the bonds authorized by this chapter, the Behavioral Health Infrastructure Act Finance Committee is hereby created.
(b)(1)The committee consists of the Controller, the Treasurer, and the Director of Finance.
(2)Notwithstanding any other law, a member may designate a representative to act as that member in the members place, for all purposes, as though the member were personally present.
(c)(1)The Treasurer shall serve as chairperson of the committee.
(2)A majority of the committee may act for the committee.
5965.08.(a)The committee shall determine, by resolution, whether it is necessary or desirable to issue and sell bonds authorized pursuant to this chapter to carry out the actions specified in this chapter and, if so, the amount of bonds to be issued and sold.
(b)Successive issues of bonds may be authorized and sold to carry out those actions progressively, and it is not necessary that all of the bonds authorized to be issued be sold at any one time.
5965.09.(a)There shall be collected each year, and in the same manner and at the same time as other state revenue is collected, in addition to the ordinary revenues of the state, a sum in an amount required to pay the principal of, and interest on, the bonds becoming due each year.
(b)It is the duty of all officers charged by law with a duty in regard to the collection of the revenue to do and perform each and every act that is necessary to collect that additional sum.
5965.10.Notwithstanding Section 13340 of the Government Code, there is hereby continuously appropriated from the General Fund in the State Treasury, for the purposes of this chapter and without regard to fiscal years, an amount that equals the total of the following:
(a)The sum annually necessary to pay the principal of, and interest on, bonds issued and sold pursuant to this chapter, as the principal and interest become due and payable.
(b)The sum necessary to carry out Section 5965.11.
5965.11.(a)For the purpose of carrying out this chapter, the Director of Finance may authorize the withdrawal from the General Fund of an amount or amounts not to exceed the amount of the unsold bonds that have been authorized by the committee to be sold for the purpose of carrying out this chapter, excluding refunding bonds authorized pursuant to Section 5965.14 less any amount loaned pursuant to Section 5965.12 and not yet repaid, and any amount withdrawn from the General Fund pursuant to this section and not yet returned to the General Fund.
(b)Any amounts withdrawn shall be deposited in the fund.
(c)Any moneys made available under this section shall be returned to the General Fund, with interest at the rate earned by the moneys in the Pooled Money Investment Account, from proceeds received from the sale of bonds for the purpose of carrying out this chapter.
5965.12.(a)The board may request the Pooled Money Investment Board to make a loan from the Pooled Money Investment Account, in accordance with Section 16312 of the Government Code, for the purpose of carrying out this chapter, less any amount withdrawn pursuant to Section 5965.11 and not yet returned to the General Fund. chapter.
(b)The amount of the request shall not exceed the amount of the unsold bonds that the committee has, by resolution, authorized to be sold for the purpose of carrying out this chapter, excluding refunding bonds authorized pursuant to Section 5965.14, less any amount loaned pursuant to this section and not yet repaid and withdrawn from the General Fund pursuant to Section 5965.11 and not yet returned to the General Fund.
(c)The board shall execute documents required by the Pooled Money Investment Board to obtain and repay the loan.
(d)Any amounts loaned shall be deposited in the fund to be allocated by the board in accordance with this chapter.
5965.13.All moneys deposited in the fund that are derived from premium and accrued interest on bonds sold pursuant to this chapter shall be reserved in the fund and shall be available for transfer to the General Fund as a credit to expenditures for bond interest, except that amounts derived from premium may be reserved and used to pay costs of bond issuance before any transfer to the General Fund.
5965.14.(a)The bonds issued and sold pursuant to this chapter may be refunded in accordance with Article 6 (commencing with Section 16780) of Chapter 4 of Part 3 of Division 4 of Title 2 of the Government Code, which is a part of the State General Obligation Bond Law.
(b)Approval by the voters of the state for the issuance of the bonds described in this chapter includes the approval of the issuance of bonds issued to refund bonds originally issued under this chapter or any previously issued refunding bonds.
(c)A bond refunded with the proceeds of refunding bonds, as authorized by this section, may be legally defeased to the extent permitted by law in the manner and to the extent set forth in the resolution, as amended, authorizing that refunded bond.
5965.15.(a)Notwithstanding any provision of this chapter or the State General Obligation Bond Law, if the Treasurer sells bonds pursuant to this chapter that include a bond counsel opinion to the effect that the interest on the bonds is excluded from gross income for federal tax purposes, under designated conditions, or is otherwise entitled to a federal tax advantage, the Treasurer may maintain separate accounts for the investment of bond proceeds and the investment earnings on those proceeds.
(b)The Treasurer may use or direct the use of those proceeds or earnings to pay a rebate, penalty, or other payment required under federal law or to take any other action with respect to the investment and use of those bond proceeds, required or desirable under federal law, to maintain the tax-exempt status of those bonds and to obtain any other advantage under federal law on behalf of the funds of this state.
5965.16.The proceeds from the sale of bonds authorized by this chapter are not proceeds of taxes as that term is used in Article XIIIB of the California Constitution, and the disbursement of these proceeds is not subject to the limitations imposed by that article.
5966.(a)(1)The Department of Housing and Community Development, in coordination with the Department of Veterans Affairs, shall determine the methodology and distribution of the funds provided pursuant to paragraph (1) of subdivision (b) of Section 5965.04, used for the purposes provided in subdivision (a) of Section 5965.04.
(2)The Department of Housing and Community Development and the Department of Veterans Affairs shall work in coordination pursuant to a memorandum of understanding.
(b)The Department of Housing and Community Development shall determine the methodology and distribution of the funds provided pursuant to paragraph (2) of subdivision (b) of Section 5965.04, used for the purposes provided in subdivision (a) of Section 5965.04.
5966.02.(a)(1)Notwithstanding any other law, funds allocated for the purposes specified in paragraphs (1) and (2) of subdivision (a) of Section 5965.04 shall be disbursed in accordance with subdivisions (a) to (h), inclusive, Section 50675.1.3 of the Health and Safety Code and any associated guidelines changes to that program, as provided in the Multifamily Housing Program in Chapter 6.7 (commencing with Section 50675) of Part 2 of Division 31 of the Health and Safety Code, and this chapter, consistent with applicable law and guidance.
(2)The Department of Housing and Community Development shall issue guidance regarding implementation by July 1, 2025.
(b)In developing the guidance referenced in subdivision (a) of Section 5966, the Department of Housing and Community Development shall consult with the Department of Veterans Affairs regarding supportive services plan standards and other program areas where the Department of Veterans Affairs holds expertise for the purposes specified in paragraph (1) of subdivision (a) of Section 5965.04.
5967.The Department of Health Care Services shall determine the methodology and distribution of the funds provided pursuant to paragraph (3) of subdivision (b) of Section 5965.04, used for the purposes provided in subdivision (a) of Section 5965.04.
5967.01.(a)Notwithstanding any other law, funds allocated for the purposes specified in paragraph (3) of subdivision (a) of Section 5965.04 shall be disbursed in accordance with the Behavioral Health Continuum Infrastructure Program (commencing with Section 5960), and this chapter, consistent with applicable law and guidance.
(b)The Department of Health Care Services shall issue guidance regarding the implementation of this article by July 1, 2025.
SEC. 5.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because a local agency or school district has the authority to levy service charges, fees, or assessments sufficient to pay for the program or level of service mandated by this act, within the meaning of Section 17556 of the Government Code.
SEC. 2.SEC. 6.Section 1 Sections 1, 2, and 4 of this act shall take effect upon the approval by the voters of the Behavioral Health Infrastructure Bond Act of 2023, 2024, as set forth in Section 1 4 of this act.
SEC. 3.SEC. 7.Section 1 4 of this act and Sections ____ of the Behavioral Health Services Act, as set forth in Senate Bill 326 of the 202324 Regular Session, shall be submitted to the voters at the March 5, 2024, statewide primary election election, and shall appear on the ballot as a single measure in accordance with provisions of the Government Code and the Elections Code governing the submission of a statewide measure to the voters.
This chapter shall be known, and may be cited, as the Behavioral Health Infrastructure Bond Act of 2023.
5965.01.The people of California find and declare all of the following:
(a)The intent of the bonds issued under this act is to help provide appropriate care options for Californians living with serious mental health conditions and substance use disorders who need a higher level of care, which may include long-term residential support services.
(b)The bonds would fund the development of an array of voluntary, unlocked, community-based treatment and residential care settings. These settings represent key sublevels of care that are necessary to support individuals with the most complex behavioral health conditions to succeed as they journey through the care continuum from acute settings to residential settings to supported housing settings.
(c)There are over 10,000 Californian veterans experiencing homelessness. Over 50 percent of homeless veterans suffer from mental health issues and 70 percent are affected by substance use disorders. The bond would also provide funding for housing of veterans experiencing homelessness who are living with behavioral health challenges.
(d)The data is alarming. In 2022, 1 in 20 adults in California is living with a serious mental illness (SMI), representing a nearly 50-percent increase in the last decade. One in 13 children in California has a serious emotional disturbance (SED), which is more common in children in low-income families. Thirty percent of youth 12 to 24 years of age, inclusive, experience serious psychological distress. One in 10 Californians meet the criteria for a substance use disorder (SUD) and the rate of SUDs among youth 18 to 25 years of age, inclusive, is nearly twice that of adults and more than three times that of adolescents.
(e)Veterans have a higher rate of suicide than the general population and experience higher rates of mental illness or substance use disorder. In 2020, there were over 10,000 Californian veterans experiencing homelessness.
(f)Meeting the growing demand for behavioral health care has exposed strained infrastructure. The limited availability of clinically appropriate, culturally competent, community-based care facilities and residential settings to support rehabilitation and recovery contributes to the growing crisis of homelessness and incarceration among those living with an SMI and an SUD. Research in 2021 indicates that the state has a shortage of over 2,700 subacute and nearly 3,000 community residential beds.
(g)The state will continue to invest in needed infrastructure through establishing the Behavioral Health Infrastructure Bond Act of 2023 and building community-based treatment and residential care settings. Funds will also support housing for veterans experiencing homelessness with behavioral health needs.
(h)Efforts to streamline the process for approving projects and renovating or building new facilities to accelerate the delivery of care in residential settings made available through additional Behavioral Health Services Act and bond financing is a priority.
5965.02.As used in this chapter, the following terms have the following meanings:
(a)Act means the Behavioral Health Infrastructure Bond Act of 2023 (Chapter 4 (commencing with Section 5965)).
(b)Board means the State Department of Health Care Services, with respect to the bond proceeds referenced in paragraph (2) of subdivision (b) of Section 5965.04, and the Department of Housing and Community Development, with respect to bond proceeds referenced in paragraph (1) of subdivision (b) of Section 5965.04, and either the State Department of Health Care Services, with respect to and for requests up to the amount specified for bond proceeds referenced in paragraph (2) of subdivision (b) of Section 5965.04, or the Department of Housing and Community Development, with respect to and for requests up to the amount specified for bond proceeds referenced in paragraph (1) of subdivision (b) of Section 5965.04, for purposes of Section 5965.12 of this code and Section 16726 of the Government Code.
(c)Committee means the Behavioral Health Infrastructure Act Finance Committee created pursuant to Section 5965.07.
(d)Fund means the Behavioral Health Infrastructure Fund created pursuant to Section 5965.03.
(e)State General Obligation Bond Law means the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), as it may be amended.
5965.03.(a)The proceeds of interim debt and bonds, excluding proceeds used directly to repay interim debt and excluding bonds issued in accordance with Section 5965.14, issued and sold pursuant to this chapter shall be deposited in the Behavioral Health Infrastructure Fund, which is hereby created in the State Treasury.
(b)All moneys in the fund, notwithstanding Section 13340 of the Government Code, are hereby continuously appropriated without respect to fiscal years for the purposes of this chapter.
(c)Bonds shall be issued and delivered in the amount determined by the committee to be necessary or desirable pursuant to Section 5965.08.
5965.035.(a)An eligible applicant that is allocated funds for a grant program pursuant to this chapter shall not use more than 5 percent of the funds allocated for the program to pay the administrative costs of that program.
(b)Eligible administrative costs will be determined by the State Department of Health Care Services for grants administered under paragraph (1) of subdivision (a) of Section 5965.04 and by the Department of Housing and Community Development under paragraph (2) of subdivision (a) of Section 5965.04.
5965.04.(a)Moneys in the fund shall be used for all of the following purposes:
(1)Making grants administered by the State Department of Health Care Services for the acquisition of capital assets for, and the construction and rehabilitation of, unlocked, voluntary, and community-based treatment settings and residential care settings.
(2)Making grants administered by the Department of Housing and Community Development to acquire capital assets for, and to construct and rehabilitate housing for, veterans and others who are experiencing homelessness or are at risk of homelessness and are living with a behavioral health challenge, as defined in subdivision (b) of Section 5962.01.
(3)Paying general administrative costs of the board, not to exceed 3 percent of the net proceeds of each sale of bonds.
(4)(A)Paying the costs of issuing bonds, paying the annual administration costs of the bonds, and paying interest on bonds.
(B)In addition, moneys in the fund or other proceeds of the sale of bonds authorized by this chapter may be used to pay principal of, or redemption premium on, interim debt issued prior to the issuance of bonds authorized by this chapter.
(b)Moneys in the fund shall be allocated as follows:
(1)Up to eight hundred sixty-five million dollars ($865,000,000) of the proceeds of the bonds, after allocation of bond proceeds to the purposes described in paragraphs (3) and (4) of subdivision (a), shall be used for the grants, grant implementation, and grant oversight described in paragraph (2) of subdivision (a). Subdivisions (a) and (b) of Section 16727 of the Government Code shall not apply to the allocation of these proceeds.
(2)The remaining proceeds of the bonds, after allocation of bond proceeds for purposes described in paragraphs (2) to (4), inclusive, of subdivision (a), shall be used for grants, as described in paragraph (1) of subdivision (a), and for grant implementation oversight.
(c)(1)A housing project funded, in whole or in part, pursuant to this section shall be a use by right subject to a streamlined, ministerial review pursuant to Section 65912.114 of the Government Code, notwithstanding subdivision (i) of that section.
(2)A project proponent shall require all contractors and subcontractors performing work on the project to pay prevailing wages for any proposed rehabilitation, construction, or major alterations in accordance with Chapter 1 (commencing with Section 1720) of Part 7 of Division 2 of the Labor Code.
(3)A project complies with Sections 65912.130 and 65912.131 of the Government Code if it is 50 or more housing units.
5965.05.(a)(1)Bonds in the total amount of four billion six hundred eighty million dollars ($4,680,000,000), not including the amount of refunding bonds issued in accordance with Section 5965.14, may be issued and sold for the purposes expressed in this chapter and to reimburse the General Obligation Bond Expense Revolving Fund pursuant to Section 16724.5 of the Government Code.
(2)The bonds, when sold, issued, and delivered, shall be and constitute a valid and binding obligation of the State of California, and the full faith and credit of the State of California is hereby pledged for the punctual payment of both the principal of, and interest on, the bonds as the principal and interest become due and payable.
(b)(1)The Treasurer shall issue and sell the bonds authorized in subdivision (a) in the amount determined by the committee to be necessary or desirable pursuant to Section 5965.08.
(2)The bonds shall be issued and sold upon the terms and conditions specified in a resolution to be adopted by the committee pursuant to Section 5965.08.
5965.06.The bonds authorized by this chapter shall be prepared, executed, issued, sold, paid, and redeemed as provided in the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), as amended, and all of the provisions of that law, as amended, apply to the bonds and to this chapter and are hereby incorporated in this chapter as though set forth in full in this chapter.
5965.07.(a)Solely for the purpose of authorizing the issuance and sale, pursuant to the State General Obligation Bond Law, of the bonds authorized by this chapter, the Behavioral Health Infrastructure Act Finance Committee is hereby created.
(b)(1)The committee consists of the Controller, the Treasurer, and the Director of Finance.
(2)Notwithstanding any other law, a member may designate a representative to act as that member in the members place, for all purposes, as though the member were personally present.
(c)(1)The Treasurer shall serve as chairperson of the committee.
(2)A majority of the committee may act for the committee.
5965.08.(a)The committee shall determine, by resolution, whether it is necessary or desirable to issue and sell bonds authorized pursuant to this chapter to carry out the actions specified in this chapter and, if so, the amount of bonds to be issued and sold.
(b)Successive issues of bonds may be authorized and sold to carry out those actions progressively, and it is not necessary that all of the bonds authorized to be issued be sold at any one time.
5965.09.(a)There shall be collected each year, and in the same manner and at the same time as other state revenue is collected, in addition to the ordinary revenues of the state, a sum in an amount required to pay the principal of, and interest on, the bonds becoming due each year.
(b)It is the duty of all officers charged by law with a duty in regard to the collection of the revenue to do and perform each and every act that is necessary to collect that additional sum.
5965.10.Notwithstanding Section 13340 of the Government Code, there is hereby continuously appropriated from the General Fund in the State Treasury, for the purposes of this chapter and without regard to fiscal years, an amount that equals the total of the following:
(a)The sum annually necessary to pay the principal of, and interest on, bonds issued and sold pursuant to this chapter, as the principal and interest become due and payable.
(b)The sum necessary to carry out Section 5965.11.
5965.11.(a)For the purpose of carrying out this chapter, the Director of Finance may authorize the withdrawal from the General Fund of an amount or amounts not to exceed the amount of the unsold bonds that have been authorized by the committee to be sold for the purpose of carrying out this chapter, excluding refunding bonds authorized pursuant to Section 5965.14 less any amount loaned pursuant to Section 5965.12 and not yet repaid, and any amount withdrawn from the General Fund pursuant to this section and not yet returned to the General Fund.
(b)Any amounts withdrawn shall be deposited in the fund.
(c)Any moneys made available under this section shall be returned to the General Fund, with interest at the rate earned by the moneys in the Pooled Money Investment Account, from proceeds received from the sale of bonds for the purpose of carrying out this chapter.
5965.12.(a)The board may request the Pooled Money Investment Board to make a loan from the Pooled Money Investment Account, in accordance with Section 16312 of the Government Code, for the purpose of carrying out this chapter, less any amount withdrawn pursuant to Section 5965.11 and not yet returned to the General Fund.
(b)The amount of the request shall not exceed the amount of the unsold bonds that the committee has, by resolution, authorized to be sold for the purpose of carrying out this chapter, excluding refunding bonds authorized pursuant to Section 5965.14, less any amount withdrawn from the General Fund pursuant to Section 5965.11 and not yet returned to the General Fund.
(c)The board shall execute documents required by the Pooled Money Investment Board to obtain and repay the loan.
(d)Any amounts loaned shall be deposited in the fund to be allocated by the board in accordance with this chapter.
5965.13.All moneys deposited in the fund that are derived from premium and accrued interest on bonds sold pursuant to this chapter shall be reserved in the fund and shall be available for transfer to the General Fund as a credit to expenditures for bond interest, except that amounts derived from premium may be reserved and used to pay costs of bond issuance before any transfer to the General Fund.
5965.14.(a)The bonds issued and sold pursuant to this chapter may be refunded in accordance with Article 6 (commencing with Section 16780) of Chapter 4 of Part 3 of Division 4 of Title 2 of the Government Code, which is a part of the State General Obligation Bond Law.
(b)Approval by the voters of the state for the issuance of the bonds described in this chapter includes the approval of the issuance of bonds issued to refund bonds originally issued under this chapter or any previously issued refunding bonds.
(c)A bond refunded with the proceeds of refunding bonds, as authorized by this section, may be legally defeased to the extent permitted by law in the manner and to the extent set forth in the resolution, as amended, authorizing that refunded bond.
5965.15.(a)Notwithstanding any provision of this chapter or the State General Obligation Bond Law, if the Treasurer sells bonds pursuant to this chapter that include a bond counsel opinion to the effect that the interest on the bonds is excluded from gross income for federal tax purposes, under designated conditions, or is otherwise entitled to a federal tax advantage, the Treasurer may maintain separate accounts for the investment of bond proceeds and the investment earnings on those proceeds.
(b)The Treasurer may use or direct the use of those proceeds or earnings to pay a rebate, penalty, or other payment required under federal law or to take any other action with respect to the investment and use of those bond proceeds, required or desirable under federal law, to maintain the tax-exempt status of those bonds and to obtain any other advantage under federal law on behalf of the funds of this state.
5965.16.The sale of bonds authorized by this chapter are not proceeds of taxes as that term is used in Article XIIIB of the California Constitution, and the disbursement of these proceeds is not subject to the limitations imposed by that article.
SEC. 2.Section 1 of this act shall take effect upon the approval by the voters of the Behavioral Health Infrastructure Bond Act of 2023, as set forth in Section 1 of this act.
SEC. 3.Section 1 of this act shall be submitted to the voters at the March 5, 2024, statewide primary election in accordance with provisions of the Government Code and the Elections Code governing the submission of a statewide measure to the voters.
SECTION 1.Article 5aa (commencing with Section 998.700) is added to Chapter 6 of Division 4 of the Military and Veterans Code, to read:5aa.The Veterans Housing and Homeless Prevention Bond Act of 2024998.700.This article shall be known, and may be cited, as the Veterans Housing and Homeless Prevention Bond Act of 2024.998.701.(a)The State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), as amended from time to time, except as otherwise provided herein, is adopted for the purpose of the issuance, sale, and repayment of, and otherwise providing with respect to, the bonds authorized to be issued by this article, and the provisions of that law are included in this article as though set out in full in this article. All references in this article to herein refer both to this article and that law.(b)For purposes of the State General Obligation Bond Law, the Department of Veterans Affairs is designated the board. The Department of Veterans Affairs shall carry out the board duties in consultation with the California Housing Finance Agency and the Department of Housing and Community Development.998.702.As used herein, the following terms shall have the following meanings:(a)Board means the Department of Veterans Affairs.(b)Bond means a veterans bond, a state general obligation bond, issued pursuant to this article adopting the provisions of the State General Obligation Bond Law.(c)Bond act means this article authorizing the issuance of state general obligation bonds and adopting the State General Obligation Bond Law, as amended from time to time, by reference.(d)Committee means the Housing for Veterans Finance Committee, established pursuant to Section 998.547.(e)Fund means the Housing for Veterans Fund, established pursuant to Section 998.544.998.703.(a)Bonds in the total amount of six hundred million dollars ($600,000,000), not including the amount of any refunding bonds issued pursuant to Section 998.713, may be issued and sold to provide a fund to be used for carrying out the purposes expressed in subdivision (b) and to reimburse the General Obligation Bond Expense Revolving Fund pursuant to Section 16724.5 of the Government Code. The bonds, when sold, issued, and delivered, shall be and constitute a valid and binding obligation of the State of California, and the full faith and credit of the State of California is hereby pledged for the punctual payment of both principal of, and interest on, the bonds as the principal and interest become due and payable.(b)The proceeds of bonds issued and sold pursuant to this section, exclusive of refunding bonds issued pursuant to Section 998.713, shall be made available to the board for the purposes of creating a fund to provide housing to veterans and their families pursuant to the Veterans Housing and Homeless Prevention Act of 2014 (Article 3.2 (commencing with Section 987.001)), and any subsequent statutory enactment that amends that act or enacts or amends any successor act for the purpose of providing housing to veterans and their families.(c)The Legislature may, from time to time, by majority vote, amend the provisions of this act for the purpose of improving program efficiency, effectiveness, and accountability, or for the purpose of furthering overall program goals.(d)The proceeds of bonds issued and sold pursuant to this article, not including the proceeds of any refunding bonds issued pursuant to Section 998.713, shall be deposited in the Housing for Veterans Fund, established by Section 998.544.998.704.The bonds authorized by this article shall be prepared, executed, issued, sold, paid, and redeemed as provided in the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), as amended from time to time, and all of the provisions of that law, except subdivisions (a) and (b) of Section 16727 of the Government Code, shall apply to the bonds and to this article and are hereby incorporated in this article as though set forth in full in this article.998.705.The Housing for Veterans Finance Committee, as established and authorized pursuant to Section 998.547, shall act for the purpose of authorizing the issuance and sale pursuant to the State General Obligation Bond Law of the bonds authorized by this article.998.706.The committee shall determine whether or not it is necessary or desirable to issue bonds authorized pursuant to this article in order to carry out the actions specified in Section 998.703 and, if so, the amount of bonds to be issued and sold. Successive issues of bonds may be authorized and sold to carry out those actions progressively, and it is not necessary that all of the bonds authorized to be issued be sold at any one time.998.707.There shall be collected each year and in the same manner and at the same time as other state revenue is collected, in addition to the ordinary revenues of the state, a sum in an amount required to pay the principal of, and interest on, the bonds each year. It is the duty of all officers charged by law with any duty in regard to the collection of the revenue to do and perform each and every act that is necessary to collect that additional sum.998.708.Notwithstanding Section 13340 of the Government Code, there is hereby appropriated from the General Fund in the State Treasury, for the purposes of this article, an amount that will equal the total of the following:(a)The sum annually necessary to pay the principal of, and interest on, bonds issued and sold pursuant to this article, as the principal and interest become due and payable.(b)The sum necessary to carry out Section 998.709, appropriated without regard to fiscal years.998.709.For the purposes of carrying out this article, the Director of Finance may authorize the withdrawal from the General Fund of an amount not to exceed the amount of the unsold bonds that have been authorized by the committee to be sold for the purpose of carrying out this article, excluding refunding bonds authorized pursuant to Section 998.713, less any amount borrowed pursuant to Section 998.712 and not yet repaid and any amount loaned from the General Fund pursuant to this section not yet returned to the General Fund. Any amounts withdrawn shall be deposited in the fund. Any money made available under this section shall be returned to the General Fund plus an amount equal to the interest that the money would have earned in the Pooled Money Investment Account from proceeds received from the sale of bonds for the purpose of carrying out this article.998.710.All money deposited in the fund that is derived from premium and accrued interest on bonds sold, in excess of any amount of premium used to pay costs of issuing the bonds, shall be reserved in the fund and shall be available for transfer to the General Fund as a credit to expenditures for bond interest, except that amounts derived from premium may be reserved and used to pay costs of bond issuance before any transfer to the General Fund.998.711.Pursuant to the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), all or a portion of the cost of bond issuance may be paid out of the bond proceeds, including any premium derived from the sale of the bonds. These costs shall be shared proportionally by each program funded through this bond act.998.712.The board may request the Pooled Money Investment Board to make a loan from the Pooled Money Investment Account, in accordance with Section 16312 of the Government Code, for purposes of carrying out this article. The amount of the loan shall not exceed the amount of the unsold bonds that the committee, by resolution, has authorized to be sold for the purpose of carrying out this article, excluding refunding bonds authorized pursuant to Section 998.712, less any amount withdrawn pursuant to this section and Section 998.709 and not yet repaid. The board shall execute any documents required by the Pooled Money Investment Board to obtain and repay the loan. Any amounts loaned shall be deposited in the fund to be allocated by the board in accordance with this article.998.713.Any bonds issued pursuant to this article may be refunded in accordance with Article 6 (commencing with Section 16780) of Chapter 4 of Part 3 of Division 4 of Title 2 of the Government Code, which is a part of the State General Obligation Bond Law. Approval by the voters of the state for the issuance of the bonds described in this article includes the approval of the issuance and sale or exchange of any bonds issued to refund any bonds originally issued under this article or any previously issued refunding bonds. Any bond refunded with the proceeds of a refunding bond as authorized by this section may be legally defeased to the extent permitted by law in the manner and to the extent set forth in the resolution, as amended from time to time, authorizing that refunded bond.998.714.Notwithstanding any other provision of this article, or of the State General Obligation Bond Law, if the Treasurer sells bonds pursuant to this part that include a bond counsel opinion to the effect that the interest on the bonds is excluded from gross income for federal tax purposes under designated conditions or is otherwise entitled to any federal tax advantage, the Treasurer may maintain separate accounts for the investment of bond proceeds and for the investment of earnings on those proceeds. The Treasurer may use or direct the use of those proceeds or earnings to pay any rebate, penalty, or other payment required under federal law or take any other action with respect to the investment and use of those bond proceeds required or desirable under federal tax law or to obtain any other advantage under federal law on behalf of the funds of this state.998.715.The Legislature hereby finds and declares that, inasmuch as the proceeds from the sale of bonds authorized by this article are not proceeds of taxes as that term is used in Article XIIIB of the California Constitution, the disbursement of these proceeds is not subject to the limitations imposed by that article.SEC. 2.Section 1 of this act shall take effect upon the approval by the voters of the Veterans Housing and Homeless Prevention Bond Act of 2024, as set forth in that section.SEC. 3.Section 1 of this act shall be submitted to the voters at the March 5, 2024, statewide primary election in accordance with provisions of the Elections Code and the Government Code governing the submission of a statewide measure to the voters.This article shall be known, and may be cited, as the Veterans Housing and Homeless Prevention Bond Act of 2024.
998.701.(a)The State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), as amended from time to time, except as otherwise provided herein, is adopted for the purpose of the issuance, sale, and repayment of, and otherwise providing with respect to, the bonds authorized to be issued by this article, and the provisions of that law are included in this article as though set out in full in this article. All references in this article to herein refer both to this article and that law.
(b)For purposes of the State General Obligation Bond Law, the Department of Veterans Affairs is designated the board. The Department of Veterans Affairs shall carry out the board duties in consultation with the California Housing Finance Agency and the Department of Housing and Community Development.
998.702.As used herein, the following terms shall have the following meanings:
(a)Board means the Department of Veterans Affairs.
(b)Bond means a veterans bond, a state general obligation bond, issued pursuant to this article adopting the provisions of the State General Obligation Bond Law.
(c)Bond act means this article authorizing the issuance of state general obligation bonds and adopting the State General Obligation Bond Law, as amended from time to time, by reference.
(d)Committee means the Housing for Veterans Finance Committee, established pursuant to Section 998.547.
(e)Fund means the Housing for Veterans Fund, established pursuant to Section 998.544.
998.703.(a)Bonds in the total amount of six hundred million dollars ($600,000,000), not including the amount of any refunding bonds issued pursuant to Section 998.713, may be issued and sold to provide a fund to be used for carrying out the purposes expressed in subdivision (b) and to reimburse the General Obligation Bond Expense Revolving Fund pursuant to Section 16724.5 of the Government Code. The bonds, when sold, issued, and delivered, shall be and constitute a valid and binding obligation of the State of California, and the full faith and credit of the State of California is hereby pledged for the punctual payment of both principal of, and interest on, the bonds as the principal and interest become due and payable.
(b)The proceeds of bonds issued and sold pursuant to this section, exclusive of refunding bonds issued pursuant to Section 998.713, shall be made available to the board for the purposes of creating a fund to provide housing to veterans and their families pursuant to the Veterans Housing and Homeless Prevention Act of 2014 (Article 3.2 (commencing with Section 987.001)), and any subsequent statutory enactment that amends that act or enacts or amends any successor act for the purpose of providing housing to veterans and their families.
(c)The Legislature may, from time to time, by majority vote, amend the provisions of this act for the purpose of improving program efficiency, effectiveness, and accountability, or for the purpose of furthering overall program goals.
(d)The proceeds of bonds issued and sold pursuant to this article, not including the proceeds of any refunding bonds issued pursuant to Section 998.713, shall be deposited in the Housing for Veterans Fund, established by Section 998.544.
998.704.The bonds authorized by this article shall be prepared, executed, issued, sold, paid, and redeemed as provided in the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), as amended from time to time, and all of the provisions of that law, except subdivisions (a) and (b) of Section 16727 of the Government Code, shall apply to the bonds and to this article and are hereby incorporated in this article as though set forth in full in this article.
998.705.The Housing for Veterans Finance Committee, as established and authorized pursuant to Section 998.547, shall act for the purpose of authorizing the issuance and sale pursuant to the State General Obligation Bond Law of the bonds authorized by this article.
998.706.The committee shall determine whether or not it is necessary or desirable to issue bonds authorized pursuant to this article in order to carry out the actions specified in Section 998.703 and, if so, the amount of bonds to be issued and sold. Successive issues of bonds may be authorized and sold to carry out those actions progressively, and it is not necessary that all of the bonds authorized to be issued be sold at any one time.
998.707.There shall be collected each year and in the same manner and at the same time as other state revenue is collected, in addition to the ordinary revenues of the state, a sum in an amount required to pay the principal of, and interest on, the bonds each year. It is the duty of all officers charged by law with any duty in regard to the collection of the revenue to do and perform each and every act that is necessary to collect that additional sum.
998.708.Notwithstanding Section 13340 of the Government Code, there is hereby appropriated from the General Fund in the State Treasury, for the purposes of this article, an amount that will equal the total of the following:
(a)The sum annually necessary to pay the principal of, and interest on, bonds issued and sold pursuant to this article, as the principal and interest become due and payable.
(b)The sum necessary to carry out Section 998.709, appropriated without regard to fiscal years.
998.709.For the purposes of carrying out this article, the Director of Finance may authorize the withdrawal from the General Fund of an amount not to exceed the amount of the unsold bonds that have been authorized by the committee to be sold for the purpose of carrying out this article, excluding refunding bonds authorized pursuant to Section 998.713, less any amount borrowed pursuant to Section 998.712 and not yet repaid and any amount loaned from the General Fund pursuant to this section not yet returned to the General Fund. Any amounts withdrawn shall be deposited in the fund. Any money made available under this section shall be returned to the General Fund plus an amount equal to the interest that the money would have earned in the Pooled Money Investment Account from proceeds received from the sale of bonds for the purpose of carrying out this article.
998.710.All money deposited in the fund that is derived from premium and accrued interest on bonds sold, in excess of any amount of premium used to pay costs of issuing the bonds, shall be reserved in the fund and shall be available for transfer to the General Fund as a credit to expenditures for bond interest, except that amounts derived from premium may be reserved and used to pay costs of bond issuance before any transfer to the General Fund.
998.711.Pursuant to the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), all or a portion of the cost of bond issuance may be paid out of the bond proceeds, including any premium derived from the sale of the bonds. These costs shall be shared proportionally by each program funded through this bond act.
998.712.The board may request the Pooled Money Investment Board to make a loan from the Pooled Money Investment Account, in accordance with Section 16312 of the Government Code, for purposes of carrying out this article. The amount of the loan shall not exceed the amount of the unsold bonds that the committee, by resolution, has authorized to be sold for the purpose of carrying out this article, excluding refunding bonds authorized pursuant to Section 998.712, less any amount withdrawn pursuant to this section and Section 998.709 and not yet repaid. The board shall execute any documents required by the Pooled Money Investment Board to obtain and repay the loan. Any amounts loaned shall be deposited in the fund to be allocated by the board in accordance with this article.
998.713.Any bonds issued pursuant to this article may be refunded in accordance with Article 6 (commencing with Section 16780) of Chapter 4 of Part 3 of Division 4 of Title 2 of the Government Code, which is a part of the State General Obligation Bond Law. Approval by the voters of the state for the issuance of the bonds described in this article includes the approval of the issuance and sale or exchange of any bonds issued to refund any bonds originally issued under this article or any previously issued refunding bonds. Any bond refunded with the proceeds of a refunding bond as authorized by this section may be legally defeased to the extent permitted by law in the manner and to the extent set forth in the resolution, as amended from time to time, authorizing that refunded bond.
998.714.Notwithstanding any other provision of this article, or of the State General Obligation Bond Law, if the Treasurer sells bonds pursuant to this part that include a bond counsel opinion to the effect that the interest on the bonds is excluded from gross income for federal tax purposes under designated conditions or is otherwise entitled to any federal tax advantage, the Treasurer may maintain separate accounts for the investment of bond proceeds and for the investment of earnings on those proceeds. The Treasurer may use or direct the use of those proceeds or earnings to pay any rebate, penalty, or other payment required under federal law or take any other action with respect to the investment and use of those bond proceeds required or desirable under federal tax law or to obtain any other advantage under federal law on behalf of the funds of this state.
998.715.The Legislature hereby finds and declares that, inasmuch as the proceeds from the sale of bonds authorized by this article are not proceeds of taxes as that term is used in Article XIIIB of the California Constitution, the disbursement of these proceeds is not subject to the limitations imposed by that article.
SEC. 2.Section 1 of this act shall take effect upon the approval by the voters of the Veterans Housing and Homeless Prevention Bond Act of 2024, as set forth in that section.
SEC. 3.Section 1 of this act shall be submitted to the voters at the March 5, 2024, statewide primary election in accordance with provisions of the Elections Code and the Government Code governing the submission of a statewide measure to the voters.
REVISIONS: HeadingLine 2.|
Date
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Status
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|---|---|
| Oct 12, 2023 | Chaptered by Secretary of State - Chapter 789, Statutes of 2023. |
| Oct 12, 2023 | Approved by the Governor. |
| Sep 21, 2023 | Enrolled and presented to the Governor at 3:30 p.m. |
| Sep 14, 2023 | From committee: That the Senate amendments be concurred in. (Ayes 6. Noes 2.) (September 14). |
| Sep 14, 2023 | In Assembly. Concurrence in Senate amendments pending. |
| Sep 14, 2023 | Joint Rule 62(a), file notice suspended. (Page 3587.) |
| Sep 14, 2023 | Re-referred to Com. on H. & C.D. pursuant to Assembly Rule 77.2. |
| Sep 14, 2023 | Senate amendments concurred in. To Engrossing and Enrolling. (Ayes 66. Noes 8. Page 3608.). |
| Sep 14, 2023 | Read third time. Passed. Ordered to the Assembly. (Ayes 35. Noes 2. Page 2779.). |
| Sep 12, 2023 | Read second time. Ordered to third reading. |
| Sep 11, 2023 | Read third time and amended. Ordered to second reading. |
| Sep 11, 2023 | Joint Rule 61(a)(13) suspended. (Ayes 31. Noes 8. Page 2607.) |
| Sep 6, 2023 | Read second time. Ordered to third reading. |
| Sep 5, 2023 | Read third time and amended. Ordered to second reading. |
| Sep 5, 2023 | Read second time. Ordered to third reading. |
| Sep 1, 2023 | From committee: Do pass. (Ayes 5. Noes 2.) (September 1). |
| Aug 28, 2023 | In committee: Referred to APPR suspense file. |
| Aug 14, 2023 | In committee: Hearing postponed by committee. |
| Jul 13, 2023 | From committee: Do pass and re-refer to Com. on APPR. (Ayes 6. Noes 2.) (July 12). Re-referred to Com. on APPR. |
| Jul 11, 2023 | From committee: Do pass and re-refer to Com. on GOV. & F. (Ayes 10. Noes 1.) (July 10). Re-referred to Com. on GOV. & F. |
| Jun 21, 2023 | Re-referred to Coms. on HOUSING and GOV. & F. |
| Jun 20, 2023 | Withdrawn from committee. |
| Jun 20, 2023 | Re-referred to Com. on RLS. |
| Jun 19, 2023 | In committee: Set, first hearing. Hearing canceled at the request of author. |
| Jun 19, 2023 | From committee chair, with author's amendments: Amend, and re-refer to committee. Read second time, amended, and re-referred to Com. on HOUSING. |
| Jun 7, 2023 | Referred to Coms. on HOUSING and M. & V.A. |
| May 31, 2023 | In Senate. Read first time. To Com. on RLS. for assignment. |
| May 30, 2023 | Read third time. Passed. Ordered to the Senate. (Ayes 80. Noes 0. Page 1918.) |
| May 18, 2023 | Read second time. Ordered to third reading. |
| May 18, 2023 | From committee: Do pass. (Ayes 15. Noes 0.) (May 18). |
| May 3, 2023 | In committee: Set, first hearing. Referred to APPR. suspense file. |
| Apr 19, 2023 | From committee: Do pass and re-refer to Com. on APPR. with recommendation: To Consent Calendar. (Ayes 11. Noes 0.) (April 18). Re-referred to Com. on APPR. |
| Apr 19, 2023 | Coauthors revised. |
| Mar 29, 2023 | From committee: Do pass and re-refer to Com. on M. & V.A. (Ayes 8. Noes 0.) (March 29). Re-referred to Com. on M. & V.A. |
| Mar 29, 2023 | Coauthors revised. |
| Feb 17, 2023 | Referred to Coms. on H. & C.D. and M. & V.A. |
| Feb 9, 2023 | From printer. May be heard in committee March 11. |
| Feb 8, 2023 | Read first time. To print. |
|
Date
|
Description
|
Location
|
Votes
|
|
|---|---|---|---|---|
| Sep 14, 2023 | AB 531 Irwin Concurrence in Senate Amendments | Assembly Floor |
Passed |
|
| Sep 14, 2023 | Assembly 3rd Reading AB531 Irwin et al. By Eggman | Senate Floor |
Passed |
|
| Sep 14, 2023 | With recommendation: That Senate amendments be concurred in. | Assembly Standing Committee on Housing and Community Development |
Passed |
|
| Sep 1, 2023 | Do pass | Senate Standing Committee on Appropriations |
Passed |
|
| Aug 28, 2023 | Placed on suspense file | Senate Standing Committee on Appropriations |
Passed |
|
| Jul 12, 2023 | Do pass, but first be re-referred to the Committee on [Appropriations] | Senate Standing Committee on Governance and Finance |
Passed |
|
| Jul 10, 2023 | Do pass, but first be re-referred to the Committee on [Governance and Finance] | Senate Standing Committee on Housing |
Passed |
|
| May 30, 2023 | AB 531 Irwin Assembly Third Reading | Assembly Floor |
Passed |
|
| May 18, 2023 | Do pass. | Assembly Standing Committee on Appropriations |
Passed |
|
| Apr 18, 2023 | Do pass and be re-referred to the Committee on [Appropriations] with recommendation: To Consent Calendar | Assembly Standing Committee on Military and Veterans Affairs |
Passed |
|
| Mar 29, 2023 | Do pass and be re-referred to the Committee on [Military and Veterans Affairs] | Assembly Standing Committee on Housing and Community Development |
Passed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
|
Organization
|
Position
|
Date
|
|---|---|---|
| AARP | ** Support | |
| Aclu California Action | ** Against | |
| Aids Healthcare Foundation | ** Support | |
| All Home | ** Support | |
| Alzheimer'S San Diego | ** Support | |
| American Legion, Department Of California | ** Support | |
| Amvets, Department Of California | ** Support | |
| Big City Mayors | ** Support | |
| Board of Supervisors for the City and County of San Francisco | ** Support | |
| Cal Voices | ** Against | |
| CalChamber | ** Support | |
| California Apartment Association | ** Support | |
| California Association of Social Rehabilitation Agencies | ** Against | |
| California Association of Veteran Service Agencies | ** Support | |
| California Builders Alliance | ** Support | |
| California Business Roundtable | ** Support | |
| California Conference of Carpenters | ** Support | |
| California Council Of Community Behavioral Health Agencies | * Neutral | Aug 28, 2023 |
| California Downtown Association | ** Support | |
| California Hospital Association | ** Support | |
| California Housing Partnership Corporation | ** Support | |
| California Professional Fire Fighters | * For If Amend | Jul 12, 2023 |
| California Professional Firefighters | ** Support | |
| California Retailers Association | ** Support | |
| California State Association Of Counties | ** Against | |
| California State Association of Psychiatrists | ** Support | |
| California State Association Of Public Administrators, Public Guardians, And Public Conservators | ** Support | |
| California State Commanders Veterans Council | ** Support | |
| Carlsbad | * Support | Aug 28, 2023 |
| Cedars Sinai | ** Support | |
| Chicano Federation Of San Diego County | ** Support | |
| Cities of Compton, Fountain Valley, Fowler, Fullerton, Lemon Grove, Lindsay, | ** Support | |
| City of Alameda | ** Support | |
| City of Bakersfield | ** Support | |
| city of carlsbad | ** Support | |
| City of Chico | ** Support | |
| City of Compton | ** Support | |
| City of El Cajon | ** Support | |
| City of El Monte | ** Support | |
| City of Fountain Valley | ** Support | |
| City Of Fowler | ** Support | |
| City Of Fullerton | ** Support | |
| City Of Hayward | ** Support | |
| City Of La Mesa | ** Support | |
| City of Lemon Grove | ** Support | |
| City of Lindsay | ** Support | |
| City Of Livermore | ** Against | |
| City Of Mission Viejo | ** Against | |
| City of Monterey, Mayor Tyller Williamson | ** Support | |
| City of Moorpark | ** Support | |
| City of Moreno Valley | ** Support | |
| City of Newark, California | ** Support | |
| City of Newport Beach | ** Against | |
| City Of Oakland | ** Support | |
| city of paramount | ** Support | |
| City Of Parlier | ** Support | |
| City of Perris | ** Support | |
| City of Riverside | ** Support | |
| City Of Sacramento, Mayor Darrell Steinberg | ** Support | |
| City Of Salinas | ** Support | |
| City Of San Diego | ** Support | |
| City of San Fernando | ** Support | |
| City of San Rafael | ** Support | |
| City of Santa Barbara | ** Support | |
| City of Santa Monica | ** Support | |
| City of Santa Rosa | ** Support | |
| City of Thousand Oaks | ** Support | |
| City Of Tracy | ** Support | |
| City of West Hollywood | ** Support | |
| Clinica Sierra Vista | ** Support | |
| Comite Civico Del Valle | ** Support | |
| County of Santa Clara | ** Support | |
| Dbsa California | ** Against | |
| Devine & Gong | ** Support | |
| Disability Rights California | ** Against | |
| Eden Housing | ** Support | |
| Father Joe's Villages | ** Support | |
| Greater Riverside Chambers of Commerce | ** Support | |
| Greater Sacramento Urban League | ** Support | |
| Hope the Mission | ** Support | |
| Housing California | ** Support | |
| HousingMV.org | ** Support | |
| Howard Jarvis Taxpayers Association | ** Against | |
| Humboldt County Board of Supervisors | ** Support | |
| Illumination Foundation | ** Support | |
| Jerry Dyer, Mayor of City of Fresno | ** Support | |
| Jewish Family Service of San Diego | ** Support | |
| Julian A. Gold, M.D. Mayor, City of Beverly Hills | ** Support | |
| Koreatown Youth and Community Center INC. | ** Support | |
| League Of California Cities | ** Support | |
| Livable California | ** Support | |
| Los Angeles Business Council | ** Support | |
| Matt Mahan, Mayor City of San José | ** Support | |
| Mayor Farrah N. Khan, City of Irvine | ** Support | |
| Mayor Jerry Dyer, City of Fresno | ** Support | |
| Mayor Sheng Thao, City of Oakland | ** Support | |
| McAlister Institute for Treatment & Education INC. | ** Support | |
| Menlo Park Mayor Jen Wolosin | ** Support | |
| Military Officers Association Of America, California Council Of Chapters | ** Support | |
| Mission Street Neighbors | ** Support | |
| Monterey, Moreno Valley, Paramount, Parlier, Riverside, Sacramento, Salinas, San Leandro, San Rafael, Santa Monica, and Tracy | ** Support | |
| NextGen California | ** Support | |
| Office of Lieutenant Governor Eleni Kounalakis | ** Support | |
| Pallet Shelter | ** Support | |
| Rural County Representatives of California | ** Against | |
| Sacramento Regional Builders Exchange | ** Support | |
| San Diego Housing Commission | ** Support | |
| San Francisco Chamber of Commerce | ** Support | |
| San Gabriel Valley Economic Partnership | ** Support | |
| San Jose Chamber of Commerce | ** Support | |
| San Leandro City Of | ** Support | |
| Silicon Valley Leadership Group | ** Support | |
| South Asian Network | ** Support | |
| Southern California Rental Housing Association | ** Support | |
| State Building and Trades Council | * Against | Jul 12, 2023 |
| Steinberg Institute | ** Support | |
| Supervisor James Gore, County of Sonoma District 4 | ** Support | |
| Sutter Health | ** Support | |
| The Salvation Army | ** Support | |
| The Umbrella Effect: Project Becky | ** Support | |
| Urban Counties of California | ** Against | |
| VALLEY INDUSTRY AND COMMERCE ASSOCIATION | ** Support | |
| Vietnam Veterans Of America, California State Council | ** Support | |
| Wellhead Electric Company | ** Support |
Date of Hearing: September 14, 2023
ASSEMBLY COMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT
Buffy Wicks, Chair
ABPCA Bill Id:AB 531 (
Author:Irwin) – As Amended Ver:September 11, 2023
SUBJECT: The Behavioral Health Infrastructure Bond Act of 2024
SUMMARY: Creates the Behavioral Health Infrastructure Bond Act of 2024 (Bond) to, subject to voter approval, authorize $6.380 billion in general obligation (GO) bonds to finance permanent supportive housing for veterans and others, as well as, unlocked and locked behavioral health treatment and residential settings for individuals experiencing homelessness or at risk of homelessness with severe behavioral health challenges. Allows for by right streamlined, ministerial review for capital projects funded by the bond. Specifically, this bill:
- Authorizes $6.380 billion, subject to voter approval, in bond funds to be expended as follows:
- $1.05 billion for loans or grants to develop supportive housing for veterans experiencing or at risk of homelessness with behavioral health challenges, administered by the Department of Housing and Community Development (HCD) and the Department of Veterans Affairs (CalVet);
- $922 million for loans or grants to develop supportive housing for people experiencing or at risk of homelessness with behavioral health challenges, administered by HCD;
- $1.5 billion to be awarded to counties, cities and tribal entities for grants for behavioral health treatment and residential settings eligible under the Behavioral Health Continuum Infrastructure Program (BHCIP), of which $30 million is designated to tribal entities; and
- $2.893 billion for grants for behavioral health treatment and residential settings authorized under BHCIP, to be administered by the Department of Health Care Services (DHCS).
- Provides that a housing project funded by bond funds for permanent supportive housing for veterans and other individuals experiencing homelessness with behavioral health challenges shall be a use by right and subject to a streamlined, ministerial review process if it meets, among other things, the following criteria:
- It is located in a zone where multifamily residential use, office, retail, or parking are a principally permitted use;
- It is not on a specified environmentally sensitive site;
- Is not on a site or adjoined to any site where more than a third of the square footage on the site is dedicated to industrial use;
- The development meets specified objective standards;
- The project meets specified labor standards; and
- No housing units were obtained by eminent domain.
- Creates a by right, streamlined approval process, not subject to a conditional use permit, discretionary permit, or any other discretionary review for the following behavioral health treatment and residential settings funded by the Bond, as follows:
- Children’s residential crisis programs, peer respite, children’s and adult substance use disorder residential programs, recovery housing, short-term residential therapeutic programs, and social rehabilitation programs on sites zoned where residential, office, retail, or parking are a principally permitted use; and
- Projects that are real estate assets, as defined under BHCIP, on zones where office, retail, or parking are a permitted use.
- Requires projects as applicable to comply with the core components of Housing First, including recovery housing, which must comply with U.S. Department of Housing and Urban Development (HUD) guidance.
- Creates the Behavioral Health Infrastructure Act Finance Committee, made up of the Controller, the Treasurer, and the Director of Finance, for purposes of authorizing the issuance and sale of bonds.
EXISTING LAW:
- Authorizes the Veterans and Affordable Housing Bond Act of 2018 for the purpose of funding various housing programs; includes a $1 billion increase in the bonding authority of the CalVet Home Loan Program. (Health and Safety Code Section 54000 et al.)
- Authorizes the Veterans Housing and Homeless Prevention (VHHP) Bond Act of 2014 for the purpose of funding $600 million in multifamily affordable, transitional, and supportive housing for low-income veteran households and veterans experiencing homelessness. (Military and Veterans Code Section 998.540 et al.)
- Authorizes specified housing development projects to be a use by right on specified sites zoned for retail, office, or parking, pursuant to AB 2011. (Government Code Section 65912.100)
- Creates BHCIP at DHCS to award competitive grants to qualified entities to construct, acquire, and rehabilitate real estate assets or to invest in needed mobile crisis infrastructure to expand the community continuum of behavioral health treatment resources to build new capacity or expand existing capacity for the following: short-term crisis stabilization; acute and subacute care; crisis residential; community-based mental health residential; substance use disorder residential; peer respite; mobile crisis; community and outpatient behavioral health services; and other clinically enriched longer term treatment and rehabilitation options for persons with behavioral health disorders in the least restrictive and least costly setting. (Welfare and Institutions Code (WIC) Section 5960.05)
- Provides that real estate assets that receive a grant from BHCIP shall be deemed consistent and in conformity with any applicable local plan, standard, or requirement, and allowed as a permitted use within the zone in which the structure is located, and shall not be subject to a conditional use permit, discretionary permit, or to any other discretionary reviews or approvals. (WIC Section 5960.3)
- Exempts from the California Environmental Quality Act (CEQA) real estate that receives a grant form BHCIP if all of the following applicable requirements are satisfied:
- The project is not acquired by eminent domain;
- The project applicant demonstrates that the project is, and will continue to be, licensed by and in good standing with the department or other state licensing entity at the time of, and for the duration of, occupancy;
- The project is in decent, safe, and sanitary condition at the time of occupancy;
- The project applicant requires all contractors and subcontractors performing work on the facility project to pay prevailing wages for any proposed rehabilitation, construction, or major alterations;
- The project applicant obtains an enforceable commitment that all contractors and subcontractors performing work on the project will use a skilled and trained workforce for any proposed rehabilitation, construction, or major alterations;
- The project applicant submits to the lead agency a letter of support, or other durable documentary proof for the project, from a county, city, or other local public entity for any new proposed construction, major alteration work, or rehabilitation;
- The project applicant demonstrates that not less than 95% of the total cost of any new construction, facility acquisition, or rehabilitation project is paid for with public funds, private non-profit funds, or philanthropic funds;
- The project applicant demonstrates that the project expands the availability of behavioral health treatment services in the subject jurisdiction;
- The project applicant demonstrates that there are long-term covenants and restrictions that require the project to be used to provide behavioral health treatment for no less than 30 years, and those covenants and restrictions may not be amended or extinguished by a subsequent title holder, owner, or operator; and
- The project does not result in any increase in the existing onsite development footprint of structures or improvements. (WIC Section 5960.3)
FISCAL EFFECT:
According to the Senate Appropriations Committee:
- Bond costs: Total principal and interest costs, in current dollars, of approximately $7.76 billion to pay off the bonds ($4.68 billion in principal and $3.08 billion in interest), with average annual debt service payments of $259 million (General Fund), when all bonds are sold, and assuming a 30-year maturity and an interest rate of 3.63% (the rate secured by the Treasurer for new 30-year bonds at the most recent sale). If interest rates increase to 5% in the near future, annual debt service would be approximately $304 million (General Fund) and total principal and interest costs over the repayment period would be approximately $9.13 billion.
- Administrative costs: HCD and DHCS would incur significant increased staffing and operations costs to administer the allocation of grants funded by this Bond (Behavior Health Infrastructure Fund). HCD and DHCS expect to utilize up to 3% of bond proceeds to design and implement the programs funded by the measure, including program operations and long term monitoring, or up to $140 million in total for administrative costs over time.
- Ballot costs: One-time Secretary of State (SOS) costs in the range of $784,000 to $984,000 for printing and mailing costs to place the measure on the ballot for the March 5, 2024 statewide primary election. (General Fund)
- This measure would also create significant cost pressures to maintain the facilities constructed or rehabilitated using bond funds, and to provide ongoing behavioral health services to residents of those facilities. (General Fund, local funds)
COMMENTS:
Author’s Statement: According to the author, “The connection between homelessness and behavioral health challenges is significant. In response to what has truly become a behavioral health crisis, I am proud to partner with Governor Newsom and Senator Eggman in proposing a major transformation of California’s behavioral health care system. The Behavioral Health Infrastructure Bond Act of 2024 would be the single largest expansion of California’s behavioral health system. The Act will expand access to high quality behavioral health treatment for those with the greatest needs. Additionally, it will dedicate funding to veterans with behavioral health needs who are currently experiencing or at risk of experiencing homelessness. Voters would need to approve the Behavioral Health Infrastructure Bond Act of 2024 at the March 5, 2024 statewide primary election.”
Homelessness in California: Over 173,000 individuals in California experience homelessness on any given night, based on the most recent annual point in time (PIT) count conducted in January 2022. This is largely considered an undercount of the actual number of people experiencing homelessness because it does not consider those that are couch-surfing or temporarily housed in non-traditional shelters. Of those individuals, over 115,000 are unsheltered, meaning they live on the streets, sleep in cars, camp in parks, or are otherwise staying in places not meant for human habitation. In June 2023, the University of California-San Francisco, Benioff Homelessness and Housing Initiative released a study of homelessness in the United States since the mid-1990s. The study provides a comprehensive look at the causes and consequences of homelessness in California and recommends policy changes to shape programs in response. The study found that for most of the participants, the cost of housing had simply become unsustainable. Participants reported a median monthly household income of $960 in the six months prior to their homelessness, and most believed that either rental subsidies or one-time financial help would have prevented their homelessness. Participants of the study also had experienced multiple forms of trauma throughout their life, increasing their vulnerability to homelessness and contributing to their mental health and substance use challenges. Two-thirds reported current mental health symptoms and more than a third experienced physical or sexual violence during this episode of homelessness. More than a third had visited an emergency department in the prior six months.
Need for Mental Health Beds and Existing DHCS Programs: According to a recent Rand study, people with mental health conditions require different levels of psychiatric beds, depending on the needs of the patient. Some need short term interventions, while others have chronic, longer-term needs. California currently has a shortage of beds for all needs; according to this study, the state needs 4,767 beds for both acute and subacute needs, and an additional 2,963 community residential beds for those with chronic needs. The report recommends that the state prioritize psychiatric bed infrastructure for those with the greatest needs, and particularly those that have the most difficulty accessing care (such as those involved in the criminal justice system).
Supportive Housing: This bond authorizes $1.05 billion for permanent supportive housing for veterans experiencing homelessness with behavioral health challenges and $922 million for permanent supportive housing for individuals experiencing homelessness with behavioral health challenges. The funds would be administered by HCD through the Home Key program. The funds for veterans’ specific housing will be administered by HCD in consultation with CalVet. A 2023 UC Berkeley Terner Center report found that proper funding for operating and services is necessary to ensure that supportive housing tenants do not fall back into homelessness. SB 326 (Eggman), the companion bill to this bond, would dedicate 30% of future Mental Health Services Act (MHSA) funds to housing interventions, which can include operating costs for permanent supportive housing. Both AB 531 and SB 326 will be placed on the March 5, 2024 ballot should they pass the Legislature.
BHCIP: This bond would authorize $4.33 billion for the creation of both locked and unlocked behavioral health treatment and residential settings for the purposes allowed under BHCIP. Administered by DHCS, BHCIP funds the construction, acquisition, and rehabilitation of real estate assets to expand the continuum of behavioral health treatment resources to build new capacity or expand existing capacity for short-term crisis stabilization, acute and subacute care, crisis residential, community-based mental health residential, substance use disorder residential, peer respite, community and outpatient behavioral health services, and other clinically enriched longer term treatment and rehabilitation options for persons with behavioral health disorders in the least restrictive and least costly setting. BHCIP was created in 2021 and to date has received $2.2 billion in funding. BHCIP has a statutory CEQA exemption if a project meets specified labor standards and is licensed, and meets other specified standards.
Streamlining for Projects: To expedite the construction of housing, the Legislature has enacted several streamlined, by right processes for approving affordable housing and market rate housing with a percentage of affordable housing. These include:
- In 2017, SB 35 (Wiener), Chapter 366 created a streamlined approval process for infill projects with two or more residential units in localities that have failed to produce sufficient housing to meet regional housing allocation numbers.
- AB 2011 (Wicks), Chapter 647, Statutes of 2022 required housing development projects to be a use by right on specified sites zoned for retail, office, or parking. To qualify for by right, a developer is required to pay prevailing wages for all construction workers on projects with 10 or more units, and with enforcement provisions. Additionally, in projects with over 50 units, all construction workers are entitled to healthcare benefits and paid prevailing wages. These larger projects also require all contactors to either participate in state approved apprenticeship programs or request the dispatch of apprentices. In other words, projects move forward if one trades apprenticeship programs cannot or will not dispatch apprentices.
- In addition, AB 2162 (Chiu), Chapter 753, Statutes of 2018 created a by right approval process for developments that are 100% affordable to lower income households that restrict at least 20% of the units to supportive housing for people experiencing homelessness.
AB 531 allows for a by right, streamlined approval process for developments funded by the bond. Permanent supportive housing would be eligible for streamlining on residential, office, parking, and retail sites provided developers met specified labor standards and locate developments on infill sites. A subset of developments that fall under the category of a behavioral health treatment and residential setting – including children’s residential crisis programs, peer respite, children’s and adult substance use disorder residential programs, recovery housing, short-term residential therapeutic programs, and social rehabilitation programs – are also eligible for by right streamlining and are exempt from CEQA on residential, office, parking, and retail sites.
Other types of real estate assets funded by the bond, including short-term crisis stabilization, acute and subacute care, crisis residential, community-based mental health residential, substance use disorder residential, peer respite, mobile crisis, community and outpatient behavioral health services, and other clinically enriched longer term treatment and rehabilitation options for persons with behavioral health disorders in the least restrictive and least costly setting would be eligible for streamlining on office, parking and retail sites but not on residential sites.
Arguments in Support: Various cities, housing and health organizations write in support of the bond, citing the need for additional permanent supportive housing and residential health beds to address the crisis of homelessness, serious mental illness, and substance abuse disorders.
Arguments in Opposition: According to Disability Rights California, “last-minute amendments to the bill undermine its original intent. Numerous presentations to the public have represented grants from AB 531 bonds will be for ‘supportive housing’ and ‘unlocked’ ‘community based settings.’ The recent amendments delete ‘voluntary, unlocked,’ ‘community-based treatment settings’ and explicitly permit these grants to be used for ‘acute and subacute care.’ This shift raises serious concerns regarding the extensive expansion of institutional care that AB 531 could facilitate…These changes are inconsistent with the stated intent of the bill and with the purpose of the MHSA itself, which prioritizes community-based services over institutional care.”
Related Legislation:
SB 326 (Eggman) of the current legislative session recasts the MHSA as the Behavioral Health Services Act (BHSA) and modifies local and state spending priorities under the BHSA, including requiring 30% of all local BHSA funds to be spent on housing interventions, in addition to other changes. This bill is pending on the Senate Floor.
REGISTERED SUPPORT / OPPOSITION:
Support
AARP
AIDS Healthcare Foundation
All Home
Alzheimer's San Diego
Big City Mayors
Board of Supervisors for the City and County of San Francisco
CalChamber
California Apartment Association
California Association of Veteran Service Agencies
California Builders Alliance
California Business Roundtable
California Conference of Carpenters
California Downtown Association
California Hospital Association
California Housing Partnership Corporation
California Professional Firefighters
California Retailers Association
California State Association of Psychiatrists (CSAP)
California State Association of Public Administrators, Public Guardians, and Public Conservators
Cedars Sinai
Chicano Federation of San Diego County
City of Alameda
City of Bakersfield
City of Carlsbad
City of Chico
City of Compton
City of El Cajon
City of El Monte
City of Fountain Valley
City of Fowler
City of Fullerton
City of Hayward
City of La Mesa
City of Lemon Grove
City of Lindsay
City of Monterey, Mayor Tyller Williamson
City of Moorpark
City of Moreno Valley
City of Newark, California
City of Oakland
City of Paramount
City of Parlier
City of Perris
City of Riverside
City of Sacramento, Mayor Darrell Steinberg
City of Salinas
City of San Diego
City of San Fernando
City of San Rafael
City of Santa Barbara
City of Santa Monica
City of Santa Rosa
City of Thousand Oaks
City of Tracy
City of West Hollywood
Clinica Sierra Vista
Comite Civico Del Valle
Councilmember Raul Campillo, City of San Diego
County of Santa Clara
Devine & Gong
Eden Housing
El Camino Homeless Organization
Father Joe's Villages
Greater Riverside Chambers of Commerce
Greater Sacramento Urban League
Hope the Mission
Housing California
HousingMV.org
Humboldt County Board of Supervisors
Illumination Foundation
Inland Empire Coalition of Mayors (IECOM)
Jerry Dyer, Mayor of City of Fresno
Jewish Family Service of San Diego
Julian A. Gold, M.D. Mayor, City of Beverly Hills
Kings Tulare Homeless Alliance
Koreatown Youth and Community Center INC.
League of California Cities
Livable California
Los Angeles Business Council
Matt Mahan, Mayor City of San José
Mayor Farrah N. Khan, City of Irvine
Mayor of City & County of San Francisco London Breed
Mayor of Half Moon Bay Deborah Penrose
McAlister Institute for Treatment & Education INC.
Menlo Park Mayor Jen Wolosin
NextGen California
Office of Lieutenant Governor Eleni Kounalakis
Pallet Shelter
Parkview Legacy
Poverello House
Sacramento Regional Builders Exchange
Salt and Light Works
San Diego Housing Commission
San Francisco Chamber of Commerce
San Gabriel Valley Economic Partnership
San Jose Chamber of Commerce
San Leandro; City of
Silicon Valley Leadership Group
South Asian Network
Southern California Rental Housing Association
Steinberg Institute
Supervisor James Gore, County of Sonoma District 4
Sutter Health
The Salvation Army, a California Corporation
The Umbrella Effect: Project Becky
United States Veterans Initiative - Inglewood
Valley Industry and Commerce Association (VICA)
Wellhead Electric Company
WISEPlace
Opposition
Cal Voices
DBSA California
Disability Rights California
Howard Jarvis Taxpayers Association (HJTA)
Oppose Unless Amended
City of Mission Viejo
City of Newport Beach
Other (Includes Letters of Concern and Support in Concept)
ACLU California Action
California Association of Social Rehabilitation Agencies
California State Association of Counties (CSAC)
City of Livermore
Rural County Representatives of California (RCRC)
Urban Counties of California (UCC)
Analysis Prepared by: Lisa Engel / H. & C.D. / (916) 319-2085
CONCURRENCE IN SENATE AMENDMENTS
CSA2 Bill Id:AB 531
Author:(Irwin)
As Amended Ver:September 11, 2023
2/3 vote
SUMMARY
Original Committee of Reference: H. & C.D. and M. & V.A.
Creates the Behavioral Health Infrastructure Bond Act of 2024 (Bond) to, subject to voter approval, authorize $6.380 billion in general obligation (GO) bonds to finance permanent supportive housing for veterans and others, as well as, unlocked and locked behavioral health treatment and residential settings for individuals experiencing homelessness or at risk of homelessness with severe behavioral health challenges. Allows for by right streamlined, ministerial review for capital projects funded by the bond.
Senate Amendments
Current Committee Recommendation: Concur
- Increases the total amount of the bond from $4.68 billion to $6.380 billion and adds funding for permanent supportive housing for people experiencing homelessness with behavioral health challenges and behavioral health treatment and residential settings.
- Authorizes $1.05 billion for permanent supportive housing for homeless veterans that have mental health or substance abuse disorders, $922 million to fund permanent supportive housing for people experiencing or at risk of homelessness and have behavioral health challenges; and $4.393 billion for grants for behavioral health treatment and residential settings eligible under the Behavioral Health Continuum Infrastructure Program (BHCIP).
- Creates specified by right approval processes for projects funded by the bond.
- Require state departments to establish guidance for the methodology and distribution of the bond funds.
COMMENTS
Homelessness in California: Over 173,000 individuals in California experience homelessness on any given night, based on the most recent annual point in time (PIT) count conducted in January 2022. This is largely considered an undercount of the actual number of people experiencing homelessness because it does not consider those that are couch-surfing or temporarily housed in non-traditional shelters. Of those individuals, over 115,000 are unsheltered, meaning they live on the streets, sleep in cars, camp in parks, or are otherwise staying in places not meant for human habitation. In June 2023, the University of California-San Francisco, Benioff Homelessness and Housing Initiative released a study of homelessness in the United States since the mid-1990s. The study provides a comprehensive look at the causes and consequences of homelessness in California and recommends policy changes to shape programs in response. The study found that for most of the participants, the cost of housing had simply become unsustainable. Participants reported a median monthly household income of $960 in the six months prior to their homelessness, and most believed that either rental subsidies or one-time financial help would have prevented their homelessness. Participants of the study also had experienced multiple forms of trauma throughout their life, increasing their vulnerability to homelessness and contributing to their mental health and substance use challenges. Two-thirds reported current mental health symptoms and more than a third experienced physical or sexual violence during this episode of homelessness. More than a third had visited an emergency department in the prior six months.
Need for Mental Health Beds and Existing DHCS Programs: According to a recent Rand study, people with mental health conditions require different levels of psychiatric beds, depending on the needs of the patient. Some need short term interventions, while others have chronic, longer-term needs. California currently has a shortage of beds for all needs; according to this study, the state needs 4,767 beds for both acute and subacute needs, and an additional 2,963 community residential beds for those with chronic needs. The report recommends that the state prioritize psychiatric bed infrastructure for those with the greatest needs, and particularly those that have the most difficulty accessing care (such as those involved in the criminal justice system).
Supportive Housing: This bond authorizes $1.05 billion for permanent supportive housing for veterans experiencing homelessness with behavioral health challenges and $922 million for permanent supportive housing for individuals experiencing homelessness with behavioral health challenges. The funds would be administered by HCD through the Home Key program. The funds for veterans' specific housing will be administered by HCD in consultation with CalVet. A 2023 UC Berkeley Terner Center report found that proper funding for operating and services is necessary to ensure that supportive housing tenants do not fall back into homelessness. SB 326 (Eggman), the companion bill to this bond, would dedicate 30% of future Mental Health Services Act (MHSA) funds to housing interventions, which can include operating costs for permanent supportive housing. Both AB 531 and SB 326 will be placed on the March 5, 2024 ballot should they pass the Legislature.
BHCIP: This bond would authorize $4.33 billion for the creation of both locked and unlocked behavioral health treatment and residential settings for the purposes allowed under BHCIP. Administered by DHCS, BHCIP funds the construction, acquisition, and rehabilitation of real estate assets to expand the continuum of behavioral health treatment resources to build new capacity or expand existing capacity for short-term crisis stabilization, acute and subacute care, crisis residential, community-based mental health residential, substance use disorder residential, peer respite, community and outpatient behavioral health services, and other clinically enriched longer term treatment and rehabilitation options for persons with behavioral health disorders in the least restrictive and least costly setting. BHCIP was created in 2021 and to date has received $2.2 billion in funding. BHCIP has a statutory CEQA exemption if a project meets specified labor standards and is licensed, and meets other specified standards.
Streamlining for Projects: To expedite the construction of housing, the Legislature has enacted several streamlined, by right processes for approving affordable housing and market rate housing with a percentage of affordable housing. These include:
- In 2017, SB 35 (Wiener), Chapter 366, created a streamlined approval process for infill projects with two or more residential units in localities that have failed to produce sufficient housing to meet regional housing allocation numbers.
- AB 2011 (Wicks), Chapter 647, Statutes of 2022 required housing development projects to be a use by right on specified sites zoned for retail, office, or parking. To qualify for by right, a developer is required to pay prevailing wages for all construction workers on projects with 10 or more units, and with enforcement provisions. Additionally, in projects with over 50 units, all construction workers are entitled to healthcare benefits and paid prevailing wages. These larger projects also require all contactors to either participate in state approved apprenticeship programs or request the dispatch of apprentices. In other words, projects move forward if one trades apprenticeship programs cannot or will not dispatch apprentices.
- In addition, AB 2162 (Chiu), Chapter 753, Statutes of 2018, created a by right approval process for developments that are 100% affordable to lower income households that restrict at least 20% of the units to supportive housing for people experiencing homelessness.
This bill allows for a by right, streamlined approval process for developments funded by the bond. Permanent supportive housing would be eligible for streamlining on residential, office, parking, and retail sites provided developers met specified labor standards and locate developments on infill sites. A subset of developments that fall under the category of a behavioral health treatment and residential setting – including children's residential crisis programs, peer respite, children's and adult substance use disorder residential programs, recovery housing, short-term residential therapeutic programs, and social rehabilitation programs – are also eligible for by right streamlining and are exempt from CEQA on residential, office, parking, and retail sites.
Other types of real estate assets funded by the bond, including short-term crisis stabilization, acute and subacute care, crisis residential, community-based mental health residential, substance use disorder residential, peer respite, mobile crisis, community and outpatient behavioral health services, and other clinically enriched longer term treatment and rehabilitation options for persons with behavioral health disorders in the least restrictive and least costly setting would be eligible for streamlining on office, parking and retail sites but not on residential sites.
According to the Author
According to the author, "The connection between homelessness and behavioral health challenges is significant. In response to what has truly become a behavioral health crisis, I am proud to partner with Governor Newsom and Senator Eggman in proposing a major transformation of California's behavioral health care system. The Behavioral Health Infrastructure Bond Act of 2024 would be the single largest expansion of California's behavioral health system. The Act will expand access to high quality behavioral health treatment for those with the greatest needs. Additionally, it will dedicate funding to veterans with behavioral health needs who are currently experiencing or at risk of experiencing homelessness. Voters would need to approve the Behavioral Health Infrastructure Bond Act of 2024 at the March 5, 2024 statewide primary election."
Arguments in Support
Various cities, housing and health organizations write in support of the bond, citing the need for additional permanent supportive housing and residential health beds to address the crisis of homelessness, serious mental illness, and substance abuse disorders.
Arguments in Opposition
According to Disability Rights California, "last-minute amendments to the bill undermine its original intent. Numerous presentations to the public have represented grants from AB 531 bonds will be for 'supportive housing' and 'unlocked' 'community based settings.' The recent amendments delete 'voluntary, unlocked,' 'community-based treatment settings' and explicitly permit these grants to be used for 'acute and subacute care.' This shift raises serious concerns regarding the extensive expansion of institutional care that AB 531 could facilitate…These changes are inconsistent with the stated intent of the bill and with the purpose of the MHSA itself, which prioritizes community-based services over institutional care."
FISCAL COMMENTS
According to the Assembly Appropriations Committee:
Bond costs: Total principal and interest costs, in current dollars, of approximately $10.58 billion to pay off the bonds ($6.38 billion in principal and $4.2 billion in interest), with average annual debt service payments of $353 million (General Fund (GF)), when all bonds are sold, and assuming a 30-year maturity and an interest rate of 3.63% (the rate secured by the Treasurer for new 30-year bonds at the most recent sale). If interest rates increase to 5% in the near future, annual debt service would be approximately $415 million (GF) and total principal and interest costs over the repayment period would be approximately $12.45 billion.
Administrative costs: The Department of Housing and Community Development (HCD) and the Department of Health Care Services (DHCS) would incur significant increased staffing and operations costs to administer the allocation of grants funded by this Bond Act (Behavior Health Infrastructure Fund). HCD and DHCS expects to utilize up to 3% of bond proceeds to design and implement the programs funded by the measure, including program operations and long term monitoring, or up to $191 million in total for administrative costs over time.
Ballot costs: One-time Secretary of State (SOS) costs of $1.36 million (GF) for printing and mailing costs to place the measure on the ballot for the March 5, 2024 statewide primary election. SOS indicates printing and mailing costs to place a measure on the statewide ballot are approximately $123,000 per page, based on the average for the last three elections, and depending on the length of the ballot. SOS estimates needing 11 additional pages in the voter information guide for this bill.
SOS further indicates, due to the extensive voter information guide costs associated with placing this measure on the March 2024 ballot, it is likely their budget allocation for the voter information guide and other election related costs will not be sufficient and additional funding (GF) may be needed for the March 2024 election.
This measure would also create significant cost pressures to maintain the facilities constructed or rehabilitated using bond funds, and to provide ongoing behavioral health services to residents of those facilities. (GF, local funds)
VOTES
ASM HOUSING AND COMMUNITY DEVELOPMENT: 8-0-0
YES: Wicks, Joe Patterson, Wendy Carrillo, Gabriel, Juan Carrillo, Quirk-Silva, Sanchez, Ward
ASM MILITARY AND VETERANS AFFAIRS: 11-0-0
YES: Soria, Davies, Addis, Alvarez, Boerner Horvath, Juan Carrillo, Mathis, Muratsuchi, Petrie-Norris, Ta, Valencia
ASM APPROPRIATIONS: 15-0-1
YES: Holden, Megan Dahle, Bryan, Calderon, Wendy Carrillo, Dixon, Mike Fong, Hart, Lowenthal, Mathis, Papan, Pellerin, Sanchez, Weber, Ortega
ABS, ABST OR NV: Robert Rivas
ASSEMBLY FLOOR: 80-0-0
YES: Addis, Aguiar-Curry, Alanis, Alvarez, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Calderon, Juan Carrillo, Wendy Carrillo, Cervantes, Chen, Connolly, Megan Dahle, Davies, Dixon, Essayli, Flora, Mike Fong, Vince Fong, Friedman, Gabriel, Gallagher, Garcia, Gipson, Grayson, Haney, Hart, Holden, Hoover, Irwin, Jackson, Jones‑Sawyer, Kalra, Lackey, Lee, Low, Lowenthal, Maienschein, Mathis, McCarty, McKinnor, Muratsuchi, Stephanie Nguyen, Ortega, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Reyes, Luz Rivas, Robert Rivas, Rodriguez, Blanca Rubio, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wicks, Wilson, Wood, Zbur, Rendon
UPDATED
VERSION: September 11, 2023
CONSULTANT: Lisa Engel / H. & C.D. / (916) 319-2085 FN: 0002464
SENATE RULES COMMITTEE Office of Senate Floor Analyses (916) 651-1520 Fax: (916) 327-4478 | AB 531 |
THIRD READING
Bill No: AB 531
Author: Irwin (D), et al.
Amended: 9/11/23 in Senate
Vote: 27
SENATE HOUSING COMMITTEE: 10-1, 7/10/23
AYES: Wiener, Ochoa Bogh, Blakespear, Caballero, Cortese, McGuire, Padilla, Skinner, Umberg, Wahab
NOES: Seyarto
SENATE GOVERNANCE & FIN. COMMITTEE: 6-2, 7/12/23
AYES: Caballero, Blakespear, Durazo, Glazer, Skinner, Wiener
NOES: Seyarto, Dahle
SENATE APPROPRIATIONS COMMITTEE: 5-2, 9/1/23
AYES: Portantino, Ashby, Bradford, Wahab, Wiener
NOES: Jones, Seyarto
ASSEMBLY FLOOR: 80-0, 5/30/23 - See last page for vote
SUBJECT: The Behavioral Health Infrastructure Bond Act of 2023
SOURCE: Author
DIGEST:
This bill creates the Behavioral Health Infrastructure Bond Act of 2024, and authorizes, subject to voter approval, the issuance of $6.38 billion in general obligation (GO) to be issued to the Department of Health Care Services (DHCS) and Department of Housing and Community Development (HCD) for funding community-based treatment and residential care settings, as well as permanent supportive housing, as specified.
Senate Floor Amendments of 9/11/23 increase the overall bond to $6.38 billion. More specifically, these amendments: (1) Provide that grants administered by the DHCS shall be used for constructing, acquiring, and rehabilitating real estate assets or investing in needed infrastructure to expand the continuum of behavioral health treatment resources to build new capacity or expanding expand existing capacity for short-term crisis stabilization, acute and subacute care, crisis residential, community-based mental health residential, substance use disorder residential, peer respite, community and outpatient behavioral health services, and other clinically enriched longer term treatment and rehabilitation options for persons with behavioral health disorders in the least restrictive and least costly setting, consistent with the BHCIP program; (2) increase the funds allocated to BHCIP by $1.5 billion as grants for local governments and eligible tribes, (3) increase the funding for permanent supportive housing for homeless veterans with behavioral health or substance abuse issues by $200 million (for a total of $1.065 billion); (4) provide that all BHCIP funded projects are eligible for streamlined approval, except that locked facilities will not be located on sites zoned for residential uses; and (5) makes other clarifying changes.
ANALYSIS:
Existing law:
- Authorizes the Veterans and Affordable Housing Bond Act of 2018 for the purpose of funding various housing programs; includes a $1 billion increase in the bonding authority of the California Department of Veterans Affairs (CalVet) Home Loan Program.
- Authorizes the Veterans Housing and Homeless Prevention (VHHP) Bond Act of 2014 for the purpose of funding $600 million in multifamily affordable, transitional, and supportive housing for low-income veteran households and veterans experiencing homelessness.
- Authorizes the Veterans Bond Act of 2008 for the purpose of establishing a fund to provide farm and home aid for veterans in the amount of $900 million under the CalVet Home Loan Program.
- Authorizes the Veterans Bond Act of 2000 for the purpose of creating a fund to provide farm and home purchase aid for veterans in the amount of $500 million.
- Authorizes DHCS to administer the Behavioral Health Continuum Infrastructure Program (BHCIP), which awards grants for the construction, acquisition, and rehabilitation of specified behavioral health treatment resources.
- Authorizes specified housing development projects to be a use by right on specified sites zoned for retail, office, or parking, as specified, pursuant to AB 2011 (Wicks, Chapter 647, Statutes of 2022).
This bill:
- Establishes the Behavioral Health Infrastructure Bond Act of 2024. Authorizes $6.380 billion in bond funds, upon voter approval on the March 5, 2024 ballot, to be issued and sold for the following purposes:
- $1.065 billion shall be used for loans or grants, grant implementation, grant oversight, and administrative costs for the conversion, rehabilitation, or new construction of permanent supportive housing, including scattered sites for veterans or their families who are homeless or at risk of homelessness and have mental health or substance abuse disorders, as specified.
- $922 million for loans or grants, grant implementation, grant oversight, and administrative costs for the conversion, rehabilitation, or new construction of permanent supportive housing including scattered sites for people who are homeless or at risk of homelessness and are living with a behavioral health challenge.
- Up to $2.893 billion for grants, grant implementation, grant oversight, and administrative costs for constructing, acquiring, and rehabilitating real estate assets or investing in needed infrastructure to expand the continuum of behavioral health treatment resources to build new capacity or expanding expand existing capacity for short-term crisis stabilization, acute and subacute care, crisis residential, community-based mental health residential, substance use disorder residential, peer respite, community and outpatient behavioral health services, and other clinically enriched longer term treatment and rehabilitation options for persons with behavioral health disorders in the least restrictive and least costly setting, consistent with the BHCIP program.
- $1.5 billion specifically for local governments and tribes for purposes (1)(c) above.
- Requires HCD, in coordination with CalVet, to determine the methodology and distribution of the funds identified in (1)(a) above. Requires HCD to determine the methodology and distribution of the funds identified in (1)(b) above, and to issue guidance regarding implementation by July 1, 2025.
- Requires DHCS to determine methodology and distribution of the funds identified in (1)(c) and (d) above, and to issue guidance regarding implementation by July 1, 2025.
- Provides that a housing project funded by bond funds identified in (1)(a) and (b) above, shall be a use by right and subject to a streamlined, ministerial review process if it meets, among other things, the following criteria:
- It is located in a zone where multifamily residential use, office, retail, or parking are a principally permitted use;
- It is not on a specified environmentally sensitive site;
- Is not on a site or adjoined to any site where more than 1/3 of the square footage on the site is dedicated to industrial use;
- The development meets specified objective standards;
- The project meets specified labor standards;
- No housing units were obtained by eminent domain.
- Provides that projects funded by bond funds identified in (1)(c) and (d) shall be a use by right and subject to a streamlined, ministerial review process, and not subject to a condition use permit, discretionary permit, or to any other discretionary review or approvals if it meets one of the following criteria:
- The project is a behavioral health treatment and residential setting, including but not limited to children’s residential crisis programs, peer respite, children’s and adult substance use disorder residential programs, recovery housing, short-term residential therapeutic program, and social rehabilitation program and is located in a zone where office, retail, or parking are a principally permitted use; or,
- The project is a real estate asset and shall be located in a zone where office, retail, or parking are a principally permitted use.
- Requires that applicable projects comply with housing first and may include recovery housing, as specified.
- Creates the Behavioral Health Infrastructure Act Finance Committee, made up of the Controller, the Treasurer, and the Director of Finance, for purposes of authorizing the issuance and sale of bonds.
Background
California has the largest concentration of severely unaffordable housing markets in the nation and the statewide average home value reached a new record in June 2022 at $793,300. To keep up with demand, HCD estimates that California must plan for the development of more than 2.5 million homes over the next eight years, and no less than one million of those homes must meet the needs of lower-income households (more than 640,000 very low-income and 385,000 low-income units are needed). As a result of the severe housing shortage, millions of Californians, who are disproportionately lower-income and people of color, must make hard decisions about paying for housing at the expense of food, health care, child care, and transportation—one in three households in the state don’t earn enough money to meet their basic needs. As housing costs continue to rise, rent becomes less affordable for lower-income households, who are forced to live beyond their means (paying more than 30% of income on housing costs) or are pushed out of their homes, leading to rapid increases in homelessness.
Comments
- Author’s statement. “The connection between homelessness and behavioral health challenges is significant. Among Californians experiencing homelessness, nearly 40,000 have a severe mental illness and over 36,000 have a chronic substance use disorder. Among homeless veterans, over 50% suffer from mental health issues and over 70% are affected by substance use disorder. In response to this behavioral health crisis, I am proud to partner with Governor Newsom and Senator Eggman in proposing a major transformation of California’s behavioral health care system. The Behavioral Health Infrastructure Bond Act of 2023 would be the single largest expansion of California’s behavioral health system. The Act will expand access to high quality, unlocked, community –based residential care for those with the greatest needs. Additionally, it will dedicate funding to veterans with behavioral health needs who are currently experiencing or at risk of experiencing homelessness. The $4.68 billion bond includes $3.815 billion in funds that would be used to build 10,000 new clinic beds and homes. The bond also includes $865 million dedicated to house veterans with serious mental illness or a substance use disorder. Voters would need to approve the Behavioral Health Infrastructure Bond Act of 2023 at the March 5, 2024 statewide primary election.”
- Need for mental health beds and existing DHCS programs. According to a recent study, people with mental health conditions require different levels of psychiatric beds, depending on the needs of the patient. Some need short term needs, while others have chronic, longer-term needs. California currently has a shortage of beds for all needs; according to this study, the state needs 4,767 beds for both acute and subacute needs, and an additional 2,963 community residential beds for those with chronic needs. The report recommends that the state prioritize psychiatric bed infrastructure for hose with the greatest needs, and particularly those that have the most difficulty accessing beds (such as those involved in the criminal justice system).
- New GO Bonds for behavior health beds. This bond bill authorizes $6.38 billion in GO bonds, except as noted below, for either the acquisition of capital assets for, or the construction and rehabilitation of, or both, community based treatment settings and residential care settings that are voluntary, unlocked and create set downs from higher acuity levels of care along the behavioral health care continuum. These projects will also enjoy by right approval.
- Publicly available funds for affordable housing. Only in the last few years have the California Legislature and Governor allocated General Fund dollars to affordable housing construction programs, following significant declines in federal funds in the 1980s. Beginning in 2019, an unprecedented $8 billion from the General Fund has gone to a variety of affordable housing programs. The Veterans and Affordable Housing Bond Act of 2018 (Proposition 1), authorized $3 billion to fund state affordable housing programs and $1 billion for the CalVet program, which provides mortgages to veterans. All of the funding from the bond will be fully allocated by the end of 2023. Proposition 2 of 2018 authorized the state to issue $2 billion in General Obligations bonds against revenues from the Mental Health Services Act for purposes of funding the No Place Like Home Program (NPLH). Those funds supported the construction of over 7,000 supportive housing units and the funds are now exhausted. Of these investments, only funds from the Affordable Housing and Sustainable Communities program (AHSC), federal and state low income housing tax credits, and funds from SB 2 (Atkins, Chapter 364, Statutes of 2017), are ongoing sources of funding. These investments, while critical, have not made up for decades of disinvestment from the federal level. Significant ongoing investments are necessary to meet the current undersupply of housing affordable to lower-income families.
- New GO bonds for permanent supportive housing. This bond bill provides up to $1.065 billion for the construction and rehabilitation of permanent supportive housing for veterans who are experiencing homelessness or are at risk of homelessness and are living with a behavioral health challenge. This bill provides an additional $922 million for people experiencing homelessness or at risk of homelessness and living with a behavioral health challenge. Projects funded by this bond would be eligible for a by right approval process if they meet specified criteria.
FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: Yes
According to the Senate Appropriations Committee:
- Bond costs: Total principal and interest costs, in current dollars, of approximately $7.76 billion to pay off the bonds ($4.68 billion in principal and $3.08 billion in interest), with average annual debt service payments of $259 million (General Fund), when all bonds are sold, and assuming a 30-year maturity and an interest rate of 3.63% (the rate secured by the Treasurer for new 30-year bonds at the most recent sale). If interest rates increase to 5% in the near future, annual debt service would be approximately $304 million (General Fund) and total principal and interest costs over the repayment period would be approximately $9.13 billion.
- Administrative costs: The Department of Housing and Community Development (HCD) and the Department of Health Care Services (DHCS) would incur significant increased staffing and operations costs to administer the allocation of grants funded by this Bond Act (Behavior Health Infrastructure Fund). HCD and DHCS expects to utilize up to 3% of bond proceeds to design and implement the programs funded by the measure, including program operations and long term monitoring, or up to $140 million in total for administrative costs over time.
- Ballot costs: One-time Secretary of State (SOS) costs in the range of $784,000 to $984,000 for printing and mailing costs to place the measure on the ballot for the March 5, 2024 statewide primary election. (General Fund)
- This measure would also create significant cost pressures to maintain the facilities constructed or rehabilitated using bond funds, and to provide ongoing behavioral health services to residents of those facilities. (General Fund, local funds)
SUPPORT: (Verified 9/11/23)
AARP
Big City Mayors
Board of Supervisors for the City and County of San Francisco
California Business Roundtable
California Conference of Carpenters
California Professional Firefighters
California Retailers Association
Chicano Federation of San Diego County
Cities of Compton, Fountain Valley, Fowler, Fullerton, Lemon Grove, Lindsay,
Monterey, Moreno Valley, Paramount, Parlier, Riverside, Sacramento, Salinas, San Leandro, San Rafael, Santa Monica, and Tracy
Clinica Sierra Vista
Comite Civico Del Valle
County of Santa Clara
Devine & Gong, Inc.
El Camino Homeless Organization
Greater Sacramento Urban League
Hope the Mission
HousingMV.org
Illumination Foundation
Jewish Family Service of San Diego
Kings Tulare Homeless Alliance
Koreatown Youth and Community Center Inc.
Lieutenant Governor Eleni Kounalakis
Mayor Farrah N. Khan, City of Irvine
Mayor Jen Wolosin, City of Menlo Park
Mayor Jerry Dyer, City of Fresno
Mayor Sheng Thao, City of Oakland
Pallet Shelter
Parkview Legacy
Poverello House
Salt and Light Works
San Francisco Chamber of Commerce
San Gabriel Valley Economic Partnership
Southern California Rental Housing Association
Steinberg Institute
Supervisor James Gore, County of Sonoma District 4
Sutter Health
The Salvation Army
The Umbrella Effect: Project Becky
United States Veterans Initiative - Inglewood
Valley Industry and Commerce Association
Wiseplace
2 Individuals
OPPOSITION: (Verified 9/11/23)
None received
ASSEMBLY FLOOR: 80-0, 5/30/23
AYES: Addis, Aguiar-Curry, Alanis, Alvarez, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Calderon, Juan Carrillo, Wendy Carrillo, Cervantes, Chen, Connolly, Megan Dahle, Davies, Dixon, Essayli, Flora, Mike Fong, Vince Fong, Friedman, Gabriel, Gallagher, Garcia, Gipson, Grayson, Haney, Hart, Holden, Hoover, Irwin, Jackson, Jones-Sawyer, Kalra, Lackey, Lee, Low, Lowenthal, Maienschein, Mathis, McCarty, McKinnor, Muratsuchi, Stephanie Nguyen, Ortega, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Reyes, Luz Rivas, Robert Rivas, Rodriguez, Blanca Rubio, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wicks, Wilson, Wood, Zbur, Rendon
Prepared by: Alison Hughes / HOUSING / (916) 651-4124
9/12/23 18:14:17
SENATE RULES COMMITTEE Office of Senate Floor Analyses (916) 651-1520 Fax: (916) 327-4478 | AB 531 |
THIRD READING
Bill No: AB 531
Author: Irwin (D), et al.
Amended: 9/5/23 in Senate
Vote: 27
SENATE HOUSING COMMITTEE: 10-1, 7/10/23
AYES: Wiener, Ochoa Bogh, Blakespear, Caballero, Cortese, McGuire, Padilla, Skinner, Umberg, Wahab
NOES: Seyarto
SENATE GOVERNANCE & FIN. COMMITTEE: 6-2, 7/12/23
AYES: Caballero, Blakespear, Durazo, Glazer, Skinner, Wiener
NOES: Seyarto, Dahle
SENATE APPROPRIATIONS COMMITTEE: 5-2, 9/1/23
AYES: Portantino, Ashby, Bradford, Wahab, Wiener
NOES: Jones, Seyarto
ASSEMBLY FLOOR: 80-0, 5/30/23 - See last page for vote
SUBJECT: The Behavioral Health Infrastructure Bond Act of 2023
SOURCE: Author
DIGEST:
This bill creates the Behavioral Health Infrastructure Bond Act of 2024, and authorizes, subject to voter approval, the issuance of $4.68 billion in general obligation (GO) to be issued to the Department of Health Care Services (DHCS) and Department of Housing and Community Development (HCD) for funding community-based treatment and residential care settings, as well as permanent supportive housing, as specified.
Senate Floor Amendments of 9/5/23 make the following changes: (1) create specified by right approval processes for projects funded by the bond; (2) require, of the $4.68 billion in authorized bond funds, for $865 million to fund permanent supportive housing for homeless veterans that have mental health or substance abuse disorders, and for $922 million to fund permanent supportive housing for people experiencing or at risk of homelessness and have behavioral health challenges (3) require state departments to establish guidance for the methodology and distribution of the bond funds; and (4) make clarifying changes.
ANALYSIS:
Existing law:
- Authorizes the Veterans and Affordable Housing Bond Act of 2018 for the purpose of funding various housing programs; includes a $1 billion increase in the bonding authority of the California Department of Veterans Affairs (CalVet) Home Loan Program.
- Authorizes the Veterans Housing and Homeless Prevention (VHHP) Bond Act of 2014 for the purpose of funding $600 million in multifamily affordable, transitional, and supportive housing for low-income veteran households and veterans experiencing homelessness.
- Authorizes the Veterans Bond Act of 2008 for the purpose of establishing a fund to provide farm and home aid for veterans in the amount of $900 million under the CalVet Home Loan Program.
- Authorizes the Veterans Bond Act of 2000 for the purpose of creating a fund to provide farm and home purchase aid for veterans in the amount of $500 million.
- Authorizes specified housing development projects to be a use by right on specified sites zoned for retail, office, or parking, as specified, pursuant to AB 2011 (Wicks, Chapter 647, Statutes of 2022).
This bill:
- Establishes the Behavioral Health Infrastructure Bond Act of 2024. Authorizes $4.68 billion in bond funds, upon voter approval on the March 5, 2024 ballot, to be issued and sold for the following purposes:
- $865 million shall be used for loans or grants, grant implementation, grant oversight, and administrative costs for the conversion or construction of permanent supportive housing, including scattered sites for veterans or their families who are homeless or at risk of homelessness and have mental health or substance abuse disorders, as specified.
- $922 million for loans or grants, grant implementation, grant oversight, and administrative costs for the conversion or construction of permanent supportive housing including scattered sites for people who are homeless or at risk of homelessness and are living with a behavioral health challenge.
- The remaining bond proceeds for grants, grant implementation, grant oversight, and administrative costs for the acquisition of capital assets or construction and rehabilitation of, or both, community-based treatment settings and residential care settings that are voluntary, unlocked, and create step downs from higher acuity levels of care along the behavioral health care continuum.
- Requires HCD, in coordination with CalVet, to determine the methodology and distribution of the funds identified in (1)(a) above. Requires HCD to determine the methodology and distribution of the funds identified in (1)(b) above, and to issue guidance regarding implementation by July 1, 2025.
- Requires DHCS to determine methodology and distribution of the funds identified in (1)(c) above, and to issue guidance regarding implementation by July 1, 2025.
- Provides that a housing project funded by bond funds identified in (1)(a) and (b) above, shall be a use by right and subject to a streamlined, ministerial review process if it meets, among other things, the following criteria:
- It is located in a zone where multifamily residential use, office, retail, or parking are a principally permitted use;
- It is not on a specified environmentally sensitive site;
- Is not on a site or adjoined to any site where more than 1/3 of the square footage on the site is dedicated to industrial use;
- The development meets specified objective standards;
- The project meets specified labor standards;
- No housing units were obtained by eminent domain.
- Provides that projects funded by bond funds identified in (1)(c) shall be a use by right and subject to a streamlined, ministerial review process, and not subject to a condition use permit, discretionary permit, or to any other discretionary review or approvals if it meets one of the following criteria:
- The project is a behavioral health treatment and residential setting, including but not limited to children’s residential crisis programs, peer respite, children’s and adult substance use disorder residential programs, recovery housing, short-term residential therapeutic program, and social rehabilitation program and is located in a zone where residential, office, retail, or parking are a principally permitted use;
- The project is a real estate asset for purposes of building new capacity or expanding existing capacity for various behavioral treatment purposes and the project complies with housing first and may include recovery housing, as specified.
- Creates the Behavioral Health Infrastructure Act Finance Committee, made up of the Controller, the Treasurer, and the Director of Finance, for purposes of authorizing the issuance and sale of bonds.
Background
California’s Housing Crisis. California has the largest concentration of severely unaffordable housing markets in the nation and the statewide average home value reached a new record in June 2022 at $793,300. To keep up with demand, HCD estimates that California must plan for the development of more than 2.5 million homes over the next eight years, and no less than one million of those homes must meet the needs of lower-income households (more than 640,000 very low-income and 385,000 low-income units are needed). As a result of the severe housing shortage, millions of Californians, who are disproportionately lower-income and people of color, must make hard decisions about paying for housing at the expense of food, health care, child care, and transportation—one in three households in the state don’t earn enough money to meet their basic needs. As housing costs continue to rise, rent becomes less affordable for lower-income households, who are forced to live beyond their means (paying more than 30% of income on housing costs) or are pushed out of their homes, leading to rapid increases in homelessness.
Comments
- Author’s statement. “The connection between homelessness and behavioral health challenges is significant. Among Californians experiencing homelessness, nearly 40,000 have a severe mental illness and over 36,000 have a chronic substance use disorder. Among homeless veterans, over 50% suffer from mental health issues and over 70% are affected by substance use disorder. In response to this behavioral health crisis, I am proud to partner with Governor Newsom and Senator Eggman in proposing a major transformation of California’s behavioral health care system. The Behavioral Health Infrastructure Bond Act of 2023 would be the single largest expansion of California’s behavioral health system. The Act will expand access to high quality, unlocked, community –based residential care for those with the greatest needs. Additionally, it will dedicate funding to veterans with behavioral health needs who are currently experiencing or at risk of experiencing homelessness. The $4.68 billion bond includes $3.815 billion in funds that would be used to build 10,000 new clinic beds and homes. The bond also includes $865 million dedicated to house veterans with serious mental illness or a substance use disorder. Voters would need to approve the Behavioral Health Infrastructure Bond Act of 2023 at the March 5, 2024 statewide primary election.”
- Need for mental health beds and existing DHCS programs. According to a recent study, people with mental health conditions require different levels of psychiatric beds, depending on the needs of the patient. Some need short term needs, while others have chronic, longer-term needs. California currently has a shortage of beds for all needs; according to this study, the state needs 4,767 beds for both acute and subacute needs, and an additional 2,963 community residential beds for those with chronic needs. The report recommends that the state prioritize psychiatric bed infrastructure for hose with the greatest needs, and particularly those that have the most difficulty accessing beds (such as those involved in the criminal justice system).
- New GO Bonds for behavior health beds. This bond bill would authorize $4.68 billion in GO bonds, except as noted below, for either the acquisition of capital assets for, or the construction and rehabilitation of, or both, community based treatment settings and residential care settings that are voluntary, unlocked and create set downs from higher acuity levels of care along the behavioral health care continuum. These projects will also enjoy by right approval.
- Publicly available funds for affordable housing. Only in the last few years have the California Legislature and Governor allocated General Fund dollars to affordable housing construction programs, following significant declines in federal funds in the 1980s. Beginning in 2019, an unprecedented $8 billion from the General Fund has gone to a variety of affordable housing programs. The Veterans and Affordable Housing Bond Act of 2018 (Proposition 1), authorized $3 billion to fund state affordable housing programs and $1 billion for the CalVet program, which provides mortgages to veterans. All of the funding from the bond will be fully allocated by the end of 2023. Proposition 2 of 2018 authorized the state to issue $2 billion in General Obligations bonds against revenues from the Mental Health Services Act for purposes of funding the No Place Like Home Program (NPLH). Those funds supported the construction of over 7,000 supportive housing units and the funds are now exhausted.
Of these investments, only funds from the Affordable Housing and Sustainable Communities program (AHSC), federal and state low income housing tax credits, and funds from SB 2 (Atkins, Chapter 364, Statutes of 2017), are ongoing sources of funding. These investments, while critical, have not made up for decades of disinvestment from the federal level. Significant ongoing investments are necessary to meet the current undersupply of housing affordable to lower-income families.
- New GO bonds for permanent supportive housing. This bond bill would provide up to $865 million for the construction and rehabilitation of permanent supportive housing for veterans who are experiencing homelessness or are at risk of homelessness and are living with a behavioral health challenge. This bill would provide an additional $922 million for people experiencing homelessness or at risk of homelessness and living with a behavioral health challenge. Projects funded by this bond would be eligible for a by right approval process if they meet specified criteria.
FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: Yes
According to the Senate Appropriations Committee:
- Bond costs: Total principal and interest costs, in current dollars, of approximately $7.76 billion to pay off the bonds ($4.68 billion in principal and $3.08 billion in interest), with average annual debt service payments of $259 million (General Fund), when all bonds are sold, and assuming a 30-year maturity and an interest rate of 3.63% (the rate secured by the Treasurer for new 30-year bonds at the most recent sale). If interest rates increase to 5% in the near future, annual debt service would be approximately $304 million (General Fund) and total principal and interest costs over the repayment period would be approximately $9.13 billion.
- Administrative costs: The Department of Housing and Community Development (HCD) and the Department of Health Care Services (DHCS) would incur significant increased staffing and operations costs to administer the allocation of grants funded by this Bond Act (Behavior Health Infrastructure Fund). HCD and DHCS expects to utilize up to 3% of bond proceeds to design and implement the programs funded by the measure, including program operations and long term monitoring, or up to $140 million in total for administrative costs over time.
- Ballot costs: One-time Secretary of State (SOS) costs in the range of $784,000 to $984,000 for printing and mailing costs to place the measure on the ballot for the March 5, 2024 statewide primary election. (General Fund)
- This measure would also create significant cost pressures to maintain the facilities constructed or rehabilitated using bond funds, and to provide ongoing behavioral health services to residents of those facilities. (General Fund, local funds)
SUPPORT: (Verified 9/2/23)
AARP
Big City Mayors
Board of Supervisors for the City and County of San Francisco
California Business Roundtable
California Conference of Carpenters
California Professional Firefighters
California Retailers Association
Chicano Federation of San Diego County
Cities of Compton, Fountain Valley, Fowler, Fullerton, Lemon Grove, Lindsay,
Monterey, Moreno Valley, Paramount, Parlier, Riverside, Sacramento, Salinas, San Leandro, San Rafael, Santa Monica, and Tracy
Clinica Sierra Vista
Comite Civico Del Valle
County of Santa Clara
Devine & Gong, Inc.
El Camino Homeless Organization
Greater Sacramento Urban League
Hope the Mission
HousingMV.org
Illumination Foundation
Jewish Family Service of San Diego
Kings Tulare Homeless Alliance
Koreatown Youth and Community Center Inc.
Mayor Farrah N. Khan, City of Irvine
Mayor Jen Wolosin, City of Menlo Park
Mayor Jerry Dyer, City of Fresno
Mayor Sheng Thao, City of Oakland
Pallet Shelter
Parkview Legacy
Poverello House
Salt and Light Works
San Francisco Chamber of Commerce
San Gabriel Valley Economic Partnership
Southern California Rental Housing Association
Steinberg Institute
Supervisor James Gore, County of Sonoma District 4
Sutter Health
The Salvation Army
The Umbrella Effect: Project Becky
United States Veterans Initiative - Inglewood
Valley Industry and Commerce Association
Wiseplace
2 Individuals
OPPOSITION: (Verified 9/2/23)
None received
ASSEMBLY FLOOR: 80-0, 5/30/23
AYES: Addis, Aguiar-Curry, Alanis, Alvarez, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Calderon, Juan Carrillo, Wendy Carrillo, Cervantes, Chen, Connolly, Megan Dahle, Davies, Dixon, Essayli, Flora, Mike Fong, Vince Fong, Friedman, Gabriel, Gallagher, Garcia, Gipson, Grayson, Haney, Hart, Holden, Hoover, Irwin, Jackson, Jones-Sawyer, Kalra, Lackey, Lee, Low, Lowenthal, Maienschein, Mathis, McCarty, McKinnor, Muratsuchi, Stephanie Nguyen, Ortega, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Reyes, Luz Rivas, Robert Rivas, Rodriguez, Blanca Rubio, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wicks, Wilson, Wood, Zbur, Rendon
Prepared by: Alison Hughes / HOUSING / (916) 651-4124
9/6/23 13:17:45
SENATE RULES COMMITTEE Office of Senate Floor Analyses (916) 651-1520 Fax: (916) 327-4478 | AB 531 |
THIRD READING
Bill No: AB 531
Author: Irwin (D), et al.
Amended: 6/19/23 in Senate
Vote: 27
SENATE HOUSING COMMITTEE: 10-1, 7/10/23
AYES: Wiener, Ochoa Bogh, Blakespear, Caballero, Cortese, McGuire, Padilla, Skinner, Umberg, Wahab
NOES: Seyarto
SENATE GOVERNANCE & FIN. COMMITTEE: 6-2, 7/12/23
AYES: Caballero, Blakespear, Durazo, Glazer, Skinner, Wiener
NOES: Seyarto, Dahle
SENATE APPROPRIATIONS COMMITTEE: 5-2, 9/1/23
AYES: Portantino, Ashby, Bradford, Wahab, Wiener
NOES: Jones, Seyarto
ASSEMBLY FLOOR: 80-0, 5/30/23 - See last page for vote
SUBJECT: The Behavioral Health Infrastructure Bond Act of 2023
SOURCE: Author
DIGEST:
This bill authorizes, subject to voter approval, the issuance of $4.68 billion in general obligation (GO) to be issued to the Department of Health Care Services (DHCS) and Department of Housing and Community Development (HCD), as specified.
ANALYSIS:
Existing law:
- Authorizes the Veterans and Affordable Housing Bond Act of 2018 for the purpose of funding various housing programs; includes a $1 billion increase in the bonding authority of the California Department of Veterans Affairs (CalVet) Home Loan Program.
- Authorizes the Veterans Housing and Homeless Prevention(VHHP) Bond Act of 2014 for the purpose of funding $600 million in multifamily affordable, transitional, and supportive housing for low-income veteran households and veterans experiencing homelessness.
- Authorizes the Veterans Bond Act of 2008 for the purpose of establishing a fund to provide farm and home aid for veterans in the amount of $900 million under the CalVet Home Loan Program.
- Authorizes the Veterans Bond Act of 2000 for the purpose of creating a fund to provide farm and home purchase aid for veterans in the amount of $500 million.
- Authorizes specified housing development projects to be a use by right on specified sites zoned for retail, office, or parking, as specified, pursuant to AB 2011 (Wicks, Chapter 647, Statutes of 2022).
This bill:
- Authorizes $4.68 billion in bond funds, upon voter approval on the March 5, 2024 ballot, to be issued and sold for the following purposes:
- Making grants administered by DHCS for the acquisition of capital assets for, and the construction and rehabilitation of, unlocked, voluntary, and community-based treatment settings and residential care settings.
- Making up to $865 million in grants administered by the Department of Housing and Community Development for the purposes of constructing and rehabilitating housing for veterans and others who are experiencing homelessness or are at risk of homelessness and living with behavioral health challenges.
- Up to 3% of the net proceeds for general administrative costs.
- Paying the costs of issuing bonds, paying the annual administration costs of the bonds, and paying interest on the bonds.
- Provides that a housing project, funded by these bond funds, shall be a use by right pursuant to AB 2011, as specified. The project proponent shall pay prevailing wages to all contractors and subcontractors performing work on the project.
- Creates the Behavioral Health Infrastructure Act Finance Committee, made up of the Controller, the Treasurer, and the Director of Finance, for purposes of authorizing the issuance and sale of bonds.
Background
California’s Housing Crisis. California has the largest concentration of severely unaffordable housing markets in the nation and the statewide average home value reached a new record in June 2022 at $793,300. To keep up with demand, HCD estimates that California must plan for the development of more than 2.5 million homes over the next eight years, and no less than one million of those homes must meet the needs of lower-income households (more than 640,000 very low-income and 385,000 low-income units are needed).
As a result of the severe housing shortage, millions of Californians, who are disproportionately lower-income and people of color, must make hard decisions about paying for housing at the expense of food, health care, child care, and transportation—one in three households in the state don’t earn enough money to meet their basic needs. As housing costs continue to rise, rent becomes less affordable for lower-income households, who are forced to live beyond their means (paying more than 30% of income on housing costs) or are pushed out of their homes, leading to rapid increases in homelessness. Variation in rates of homelessness cannot be explained by variation in rates of individual factors such as poverty or mental illness, however, cities with higher rents and lower rental vacancy rates (i.e., tighter housing markets) are directly linked to higher per capita rates of homelessness.
Comments
- Author’s statement. “The connection between homelessness and behavioral health challenges is significant. Among Californians experiencing homelessness, nearly 40,000 have a severe mental illness and over 36,000 have a chronic substance use disorder. Among homeless veterans, over 50% suffer from mental health issues and over 70% are affected by substance use disorder. In response to this behavioral health crisis, I am proud to partner with Governor Newsom and Senator Eggman in proposing a major transformation of California’s behavioral health care system. The Behavioral Health Infrastructure Bond Act of 2023 would be the single largest expansion of California’s behavioral health system. The Act will expand access to high quality, unlocked, community –based residential care for those with the greatest needs. Additionally, it will dedicate funding to veterans with behavioral health needs who are currently experiencing or at risk of experiencing homelessness. The $4.68 billion bond includes $3.815 billion in funds that would be used to build 10,000 new clinic beds and homes. The bond also includes $865 million dedicated to house veterans with serious mental illness or a substance use disorder. Voters would need to approve the Behavioral Health Infrastructure Bond Act of 2023 at the March 5, 2024 statewide primary election.”
- Need for mental health beds and existing DHCS programs. According to a recent study, people with mental health conditions require different levels of psychiatric beds, depending on the needs of the patient. Some need short term needs, while others have chronic, longer-term needs. California currently has a shortage of beds for all needs; according to this study, the state needs 4,767 beds for both acute and subacute needs, and an additional 2,963 community residential beds for those with chronic needs. The report recommends that the state prioritize psychiatric bed infrastructure for hose with the greatest needs, and particularly those that have the most difficulty accessing beds (such as those involved in the criminal justice system). Additionally, the report notes that California should require specified data collection to track the impact of its investments and makes sure funds are meeting the needs of the target populations.
Presently, DHCS operates the following homelessness and housing-related programs:
- Behavioral Health Continuum Infrastructure Program (BHCIP). This program finances the construction, acquisition, and rehabilitation of real estate assets or investments needed for mobile crisis infrastructure to expand the community continuum of behavioral health treatment resources.
- Community Care Expansion (CCE). This program is part of a statewide investment in infrastructure funding to address homelessness, support healthcare delivery reform, and strengthen the social safety net. CCE has two main focuses: (1) the CCE Capital Expansion Program which funds the acquisition, construction, and rehabilitation of residential care settings including funds to establish a capitalized operating subsidy reserves; and (2) the CCE Preservation Program intended to immediately preserve and prevent the closure of existing licensed residential adult and senior care facilities, including Residential Care Facilities for the Elderly, Adult Residential Facilities, or Residential Facilities for the Chronically Ill.
- Housing and Homelessness Incentive Program (HHIP). Medi-Cal managed care plans can earn incentive funds for making investments and progress in addressing homelessness and keeping people housed. Managed care plans and the local homeless Continuum of Care, in partnership with local public health jurisdictions, county behavioral health, Public Hospitals, county social services, and local housing departments must submit a Homelessness Plan to DHCS and identify how these funds would prioritize aging and disabled homeless Californians.
- New GO Bonds for behavior health beds. This bond bill would authorize $4.68 billion in GO bonds, except as noted below, for purposes of constructing and rehabilitating unlocked, voluntary and community based treatment settings and residential care settings. According to the author, these funds will help fund 10,000 new clinic beds and homes for those with the most severe health and substance abuse disorders.
- Publicly available funds for affordable housing. Prior to 1974, the federal government invested heavily in affordable housing construction. When those units began to deteriorate, the Housing Community and Development Act ended most new construction of public housing and the Housing Choice Voucher Program (Section 8) was created in its place. This new program allowed eligible tenants to pay only a portion of their rent (based on their income) and shifted funds from public housing authorities to the private sector. The goal was to eliminate concentrations of low-income people in housing developments. In 1981, the Reagan administration dismantled federal affordable housing funding. From 1978 to 1983, the funding for low- to moderate-income housing decreased by 77%. In 1970, there were 300,000 more low-cost rental units (6.5 million) than low-income renter households (6.2 million). By 1985, however, the number of low-cost units had fallen to 5.6 million, and the number of low-income renter households had grown to 8.9 million, a disparity of 3.3 million units. Federal investments have not gone back up to pre-1978 levels.
At the state level, California has invested significantly in affordable housing construction and rehabilitation in recent years through the passage of one-time discretionary actions in the budget and the passage of voter approved bonds.
Only in the last few years have the Legislature and Governor allocated General Fund dollars to affordable housing programs. Beginning in 2019, an unprecedented $8 billion from the General Fund has gone to a variety of affordable housing programs. The Veterans and Affordable Housing Bond Act of 2018 (Proposition 1), authorized $3 billion to fund state affordable housing programs and $1 billion for the CalVet program, which provides mortgages to veterans. All of the funding from the bond will be fully allocated by the end of 2023. Proposition 2 of 2018 authorized the state to issue $2 billion in General Obligations bonds against revenues from the Mental Health Services Act for purposes of funding the No Place Like Home Program (NPLH). Those funds supported the construction of over 7,000 supportive housing units and the funds are now exhausted. Of these investments, only funds from the Affordable Housing and Sustainable Communities program (AHSC), federal and state low income housing tax credits, and funds from SB 2 (Atkins, Chapter 364, Statutes of 2017), are ongoing sources of funding. These investments, while critical, have not made up for decades of disinvestment from the federal level. Significant ongoing investments are necessary to meet the current undersupply of housing affordable to lower-income families.
- New GO bonds for veterans housing. This bill would provide up to $865 million of the $4.68 billion for the construction and rehabilitation of housing for veterans and others who are experiencing homelessness or are at risk of homelessness and are living with a behavioral health challenge. Additionally, the bond provides that housing projects funded by this bond will be eligible for a by right approval process for specified commercial corridors, so long as project proponents pay all contractors and subcontractors prevailing wages for any proposed rehabilitation or construction.
FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No
According to the Senate Appropriations Committee:
- Bond costs: Total principal and interest costs, in current dollars, of approximately $7.76 billion to pay off the bonds ($4.68 billion in principal and $3.08 billion in interest), with average annual debt service payments of $259 million (General Fund), when all bonds are sold, and assuming a 30-year maturity and an interest rate of 3.63% (the rate secured by the Treasurer for new 30-year bonds at the most recent sale). If interest rates increase to 5% in the near future, annual debt service would be approximately $304 million (General Fund) and total principal and interest costs over the repayment period would be approximately $9.13 billion.
- Administrative costs: The Department of Housing and Community Development (HCD) and the Department of Health Care Services (DHCS) would incur significant increased staffing and operations costs to administer the allocation of grants funded by this Bond Act (Behavior Health Infrastructure Fund). HCD and DHCS expects to utilize up to 3% of bond proceeds to design and implement the programs funded by the measure, including program operations and long term monitoring, or up to $140 million in total for administrative costs over time.
- Ballot costs: One-time Secretary of State (SOS) costs in the range of $784,000 to $984,000 for printing and mailing costs to place the measure on the ballot for the March 5, 2024 statewide primary election. (General Fund)
- This measure would also create significant cost pressures to maintain the facilities constructed or rehabilitated using bond funds, and to provide ongoing behavioral health services to residents of those facilities. (General Fund, local funds)
SUPPORT: (Verified 9/1/23)
AARP
Big City Mayors
California Business Roundtable
California Conference of Carpenters
California Professional Firefighters
California Retailers Association
Chicano Federation of San Diego County
Cities of Compton, Fountain Valley, Fowler, Fullerton, Lemon Grove, Lindsay,
Monterey, Moreno Valley, Paramount, Parlier, Riverside, Sacramento, Salinas, San Leandro, San Rafael, Santa Monica, and Tracy
Clinica Sierra Vista
Comite Civico Del Valle
County of Santa Clara
Devine & Gong, Inc.
El Camino Homeless Organization
Greater Sacramento Urban League
Hope the Mission
HousingMV.org
Illumination Foundation
Jewish Family Service of San Diego
Kings Tulare Homeless Alliance
Koreatown Youth and Community Center Inc.
Mayor Farrah N. Khan, City of Irvine
Mayor Jen Wolosin, City of Menlo Park
Mayor Jerry Dyer, City of Fresno
Mayor Sheng Thao, City of Oakland
Pallet Shelter
Parkview Legacy
Poverello House
Salt and Light Works
San Francisco Chamber of Commerce
San Gabriel Valley Economic Partnership
Southern California Rental Housing Association
Steinberg Institute
Supervisor James Gore, County of Sonoma District 4
Sutter Health
The Salvation Army
The Umbrella Effect: Project Becky
United States Veterans Initiative - Inglewood
Valley Industry and Commerce Association
Wiseplace
2 Individuals
OPPOSITION: (Verified 9/1/23)
None received
ASSEMBLY FLOOR: 80-0, 5/30/23
AYES: Addis, Aguiar-Curry, Alanis, Alvarez, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Calderon, Juan Carrillo, Wendy Carrillo, Cervantes, Chen, Connolly, Megan Dahle, Davies, Dixon, Essayli, Flora, Mike Fong, Vince Fong, Friedman, Gabriel, Gallagher, Garcia, Gipson, Grayson, Haney, Hart, Holden, Hoover, Irwin, Jackson, Jones-Sawyer, Kalra, Lackey, Lee, Low, Lowenthal, Maienschein, Mathis, McCarty, McKinnor, Muratsuchi, Stephanie Nguyen, Ortega, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Reyes, Luz Rivas, Robert Rivas, Rodriguez, Blanca Rubio, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wicks, Wilson, Wood, Zbur, Rendon
Prepared by: Alison Hughes / HOUSING / (916) 651-4124
9/2/23 9:57:15
SENATE COMMITTEE ON APPROPRIATIONS
Senator Anthony Portantino, Chair
2023 - 2024 Regular Session
AB 531 (Irwin) - The Behavioral Health Infrastructure Bond Act of 2023
Version: June 19, 2023 | Policy Vote: HOUSING 10 - 1, GOV. & F. 6 - 2 |
Urgency: No | Mandate: No |
Hearing Date: August 28, 2023 | Consultant: Mark McKenzie |
Bill Summary:
AB 531 would enact the Behavioral Health Infrastructure Bond Act of 2023, which authorizes the sale of $4.68 billion in general obligation bonds, upon approval by voters at the March 5, 2024 statewide election, to provide grant funding for specified behavioral health infrastructure and housing for veterans and others who are experiencing homelessness, or are at risk of homelessness, and are living with a behavioral health challenge.
Fiscal Impact:
- Bond costs: Total principal and interest costs, in current dollars, of approximately $7.76 billion to pay off the bonds ($4.68 billion in principal and $3.08 billion in interest), with average annual debt service payments of $259 million (General Fund), when all bonds are sold, and assuming a 30-year maturity and an interest rate of 3.63% (the rate secured by the Treasurer for new 30-year bonds at the most recent sale). If interest rates increase to 5% in the near future, annual debt service would be approximately $304 million (General Fund) and total principal and interest costs over the repayment period would be approximately $9.13 billion.
- Administrative costs: The Department of Housing and Community Development (HCD) and the Department of Health Care Services (DHCS) would incur significant increased staffing and operations costs to administer the allocation of grants funded by this Bond Act (Behavior Health Infrastructure Fund). HCD and DHCS expects to utilize up to 3% of bond proceeds to design and implement the programs funded by the measure, including program operations and long term monitoring, or up to $140 million in total for administrative costs over time.
- Ballot costs: One-time Secretary of State (SOS) costs in the range of $784,000 to $984,000 for printing and mailing costs to place the measure on the ballot for the March 5, 2024 statewide primary election. (General Fund)
- This measure would also create significant cost pressures to maintain the facilities constructed or rehabilitated using bond funds, and to provide ongoing behavioral health services to residents of those facilities. (General Fund, local funds)
Background:
According to a recent study by the Rand Institute, people with mental health conditions require different levels of psychiatric care, depending on the needs of the patient. Some have short term needs, while others have chronic, longer-term needs. California currently has a shortage of beds for all needs; according to this study, the state needs 4,767 beds for both acute and subacute needs, and an additional 2,963 community residential beds for those with chronic needs. The report recommends the state prioritize psychiatric bed infrastructure for those with the greatest needs, and particularly those that have the most difficulty accessing beds (such as those involved in the criminal justice system). Additionally, the report notes California should require specified data collection to track the impact of its investments and makes sure funds are meeting the needs of the target populations.
In 2021, the Legislature directed the Department of Health Care Services (DHCS) to establish the Behavioral Health Continuum Infrastructure Program, which authorizes DHCS to award competitive grants to qualified entities to construct, acquire, and rehabilitate assets, or to invest in mobile crisis infrastructure to expand the community continuum of behavioral health treatment resources. Grants seek to expand capacity for short-term crisis stabilization, acute and subacute care, crisis residential, community-based mental health residential, substance use disorder residential, peer respite, mobile crisis, community and outpatient behavioral health services, and other treatment and rehabilitation options for behavioral health disorders.
DHCS also administers the Community Care Expansion (CCE) Program and the Housing and Homelessness Incentive Program (HHIP). The CCE Program is part of a statewide investment in infrastructure funding to address homelessness, support healthcare delivery reform, and strengthen the social safety net. CCE has two main focuses: (1) the CCE Capital Expansion Program which funds the acquisition, construction, and rehabilitation of residential care settings including funds to establish a capitalized operating subsidy reserves; and (2) the CCE Preservation Program intended to immediately preserve and prevent the closure of existing licensed residential adult and senior care facilities, including Residential Care Facilities for the Elderly, Adult Residential Facilities, or Residential Facilities for the Chronically Ill. Under the HHIP, Medi-Cal managed care plans can earn incentive funds for making investments and progress in addressing homelessness and keeping people housed. Managed care plans and the local homeless Continuum of Care, in partnership with local public health jurisdictions, county behavioral health, Public Hospitals, county social services, and local housing departments must submit a Homelessness Plan to DHCS and identify how these funds would prioritize aging and disabled homeless Californians.
Existing law, the Veterans Housing and Homeless Prevention (VHHP) Bond Act of 2014 (approved by the voters at Proposition 41 in June of 2014), authorizes the issuance of $600 million in general obligation bonds to provide multifamily housing to veterans. The VHHP requires CalHFA, HCD, and CalVet to establish and implement a program that focuses on veterans at risk of homelessness or experiencing temporary or chronic homelessness. The VHHP Program funds the acquisition, construction, rehabilitation, and preservation of affordable multifamily supportive housing, affordable transitional housing, affordable rental housing, or related facilities for veterans and their families to allow veterans to access and maintain housing stability. The administering departments must ensure that at least 50 percent of funds awarded for capital development be used to provide housing to veteran households with extremely low incomes (up to 30% of the area median income [AMI]), and 60 percent of those units must be supportive housing.
Existing law establishes the No Place Like Home Program (NPLH Program), which provides funding and tools that allow HCD to address affordability issues associated with creating housing units that are specifically set aside for persons with serious mental illness who are chronically homeless, homeless, or at-risk of being chronically homeless. Existing law, approved by the voters as Proposition 2 in 2018, requires HCD to award $2 billion in revenue bonds over four rounds among counties to finance capital costs of permanent supportive housing development, including acquisition, design, construction, rehabilitation, or preservation, and to capitalize operating reserves. The revenue bonds that fund the NPLH Program have been fully allocated and they are repaid by funding from the Mental Health Services Act.
Proposed Law:
AB 531 would enact the Behavioral Health Infrastructure Bond Act of 2023, which authorizes the sale of $4.68 billion in general obligation bonds, upon approval by voters at the March 5, 2024 statewide election. If approved, the measure would deposit bond proceeds in the Behavioral Health Infrastructure Fund, and continuously appropriate moneys from the Fund for the following purposes:
- Up to $865 million to HCD for making grants to acquire capital assets for, and to construct and rehabilitate housing for, veterans and others who are experiencing homelessness, or at risk of homelessness, and are living with a behavioral health challenge. The bill exempts these proceeds from requirements in the General Obligation Bond Law that requires capital assets to have a useful life of at least 15 years, as specified.
- Paying DHCS’s and HCD’s general administrative costs, which are not to exceed 3% of the net proceeds of each sale of bonds.
- Paying the costs of issuing bonds, and the annual administration costs of the bonds, and paying interest on bonds.
- The remaining bond proceeds, after allocations for the above purposes, would be allocated to DHCS for making grants to acquire capital assets for, and the construction and rehabilitation of, unlocked, voluntary, and community-based treatment settings and residential care settings, and for grant implementation oversight.
AB 531 would also require housing projects funded by bond proceeds to be a “use by right” subject to a streamlined, ministerial review pursuant to provisions of law enacted by AB 2011 (Wicks), Chap. 647/2022. Project proponents must require contractors and subcontractors to pay prevailing wages for any construction, rehabilitation, or major alternations.
The bill would also incorporate standard provisions in General Obligation Bond Law, either explicitly or by reference, with some modifications. AB 531 would create the Behavioral Health Infrastructure Act Finance Committee (Committee) comprised of the Director of Finance, the Treasurer, and the Controller, and charges the Committee with determining whether it is necessary or desirable to issue bonds, and if so, the amount of bonds to be issued and sold.
Related Legislation:
SB 326 (Eggman), which is currently pending in the Assembly Housing and Community Development Committee, which is a companion to this Bond Act, would enact comprehensive revisions to the Mental Health Services Act and modify local and state spending priorities under the Act, including requiring 30% of all local funds to be spent on housing interventions, as specified, eliminating allocations for local mental health prevention-based programs and recasting other local spending categories, and adding a state-level population-based prevention and stigma reduction program and statewide workforce program, among other things. Most of the changes envisioned by SB 326 would be subject to approval by the voters at the March 5, 2024 statewide election.
AB 2011 (Wicks), Chap. 647/2022, enacted the “Affordable Housing and High Road Jobs Act of 2022” to create a ministerial, streamlined approval process for 100% affordable housing projects in commercial zones and for mixed-income housing projects along commercial corridors, as specified, and imposed specified labor standards on those projects.
Staff Comments:
The State Treasurer recently sold nearly $2.6 billion in general obligation bonds (including refinancing $1.2 billion in existing bond debt). The all-in interest rate on new 30-year bonds sold on April 6, 2023 was 3.63%. The estimates noted above assume equivalent rates, but also note the difference in debt service costs if the rate rose to historical averages of 5%. Staff notes that interest rates for general obligation bond sales have fluctuated in recent years, with rates as low as 2% in 2021 and as high as 3.93% in September of 2022. California’s GO Bonds are rated Aa2 by Moody’s Investor Service, AA- by S&P Global Ratings, and AA by Fitch Ratings.
The SOS indicates that printing and mailing costs associated with placing a measure on the statewide ballot are estimated to be approximately $123,000 per page, based on the average for the last three elections, and depending on the length of the ballot. The fiscal estimates noted above reflect the addition of 6-8 pages in the Voter Information Guide. Actual costs would depend upon the length of the title and summary, analysis by the Legislative Analyst’s Office, proponent and opponent arguments, and text of the proposal
Recommended Amendments:
Staff understands that significant amendments are being considered through discussions among the author, both houses of the Legislature, and the Governor. At a minimum, staff recommends that the bill be amended to do the following:
- Delete the provision in Gov. Code Sec. 5965.03 (b) that requires all moneys deposited into the Behavioral Health Infrastructure Fund be continuously appropriated for the purposes of the Bond Act, and instead make all allocations of bond funds to DHCS and HCD subject to an appropriation by the Legislature in the Budget Act to retain appropriate legislative oversight of the expenditure of bond proceeds for programs and projects administered by those departments.
- Delete the provision in Gov. Code Sec. 5965.04 (b)(1) that exempts bond proceeds administered by HCD from requirements in the General Obligation Bond Law that authorize bond proceeds to be used for grants and loans dedicated to the construction or acquisition of capital assets, and that require that those assets have a reasonable useful life of at least 15 years.
- Specify more detail on eligible uses of funds, methodologies for allocating funding, and specifying eligible applicants for funding, to ensure bond funds are appropriately spent on infrastructure and capital assets with appropriate oversight controls, and for clarity and efficiency, require bond funds to be allocated for expenditure within existing established programs, where appropriate (such as the Veterans Housing and Homeless Prevention Program, No Place Like Home Program, the Behavioral Health Continuum Infrastructure Program, to name a few).
- Rename the Bond Act as the Behavioral Health Infrastructure Bond Act of 2023 as the Behavioral Health Infrastructure Bond Act of 2024 since it will be submitted to the voters at the March 5, 2024 statewide primary election.
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SENATE COMMITTEE ON GOVERNANCE AND FINANCE
Senator Anna M. Caballero, Chair
2023 - 2024 Regular
Bill No: | AB 531 | Hearing Date: | 7/12/23 |
Author: | Irwin | Tax Levy: | No |
Version: | 6/19/23 | Fiscal: | Yes |
Consultant: | Grinnell | ||
The Behavioral Health Infrastructure Bond Act of 2023
Enacts the Behavioral Health Infrastructure Bond Act of 2023, which places a $4.68 billion GO Bond authorization before voters at the March, 2024 statewide primary election to fund behavioral health infrastructure.
Background
When public agencies issue bonds, they essentially borrow money from investors, who provide cash in exchange for the agencies’ commitment to repay the principal amount of the bond plus interest in the future. Bonds are usually either revenue bonds, which repay investors out of revenue generated from the project the agency buys with bond proceeds or from a specific dedicated revenue source, or general obligation (GO) bonds, which the public agency pays out of general revenues and are guaranteed by its full faith and credit.
State general obligation bonds. Section One of Article XVI of the California Constitution and the state’s General Obligation Bond Law guide the issuance of the state’s GO debt. The Constitution allows the Legislature to place GO bonds on the ballot for specific purposes with a two-thirds vote of the Assembly and Senate. Voters also can place bonds on the ballot by initiative, as they have for parks, water projects, high-speed rail, and stem cell research, among others. Either way, GO bonds must be ratified by majority vote of the state’s electorate. Unlike local GO bonds, approval by the state’s electorate does not automatically trigger an increased tax to repay the bond. The Constitution commits the state to repay investors from general revenues above all other claims, except payments to public education.
California voters approved $38.4 billion of GO bonds between 1974 and 1999, which increased significantly to $112 billion between 2000 and 2010, then decreased to slightly less than $28 billion between 2010 and 2018. In 2020, voters approved Proposition 14, which authorized $5.5 billion state bonds for stem cell and other medical research.
Bond acts have standard provisions that authorize the State Treasurer to sell a specified amount of bonds, and generally include several uniform provisions that:
- Establish the state’s obligation to repay them, and pledge its full faith and credit to repayment;
- Set forth issuance procedures, and link the bond act to the state’s General Obligation Bond Law;
- Designate a finance committee with specified membership, chaired by the State Treasurer;
- Charge the committee with determining whether it is “necessary or desirable” to issue the bonds; and
- Add other mechanisms necessary for the State Treasurer and the Department of Finance (DOF) to implement the bond act, including allowing the board to request a loan from the Pooled Money Investment Board to advance funds for bond-funded programs prior to the bond sale, among others.
In bond acts, the Legislature generally:
- Sets forth categories of projects eligible for bond funds, such as library construction or school facility modernization;
- Chooses an administrative agency to award the funds, such as the State Librarian or the State Allocation Board;
- Details the criteria to guide the administrative agency’s funding in each category;
- Enacts enforcement and audit provisions; and
- Provides for an election to approve the bond act.
Should the voters approve the bond act, the Legislature generally appropriates funds to the chosen agencies to fund projects consistent with the criteria, generally as part of the Budget Act. However, some bond acts do not require direct legislative appropriation, such as school facility bonds. DOF surveys agencies to determine the need for bond funds based on a project’s readiness, and then asks the State Treasurer to sell bonds necessary to fund those projects. After the bond sale, DOF determines which bond acts and agencies receive bond proceeds.
Behavioral health infrastructure. In 2021, the Legislature directed the Department of Health Care Services (DHCS) to establish the Behavioral Health Continuum Infrastructure Program, which authorizes DHCS to award competitive grants to qualified entities to construct, acquire, and rehabilitate assets, or to invest in mobile crisis infrastructure to expand the community continuum of behavioral health treatment resources. Grants seek to expand capacity for short-term crisis stabilization, acute and subacute care, crisis residential, community-based mental health residential, substance use disorder residential, peer respite, mobile crisis, community and outpatient behavioral health services, and other treatment and rehabilitation options for behavioral health disorders.
According to a recent study by the Rand Institute[1], people with mental health conditions require different levels of psychiatric care, depending on the needs of the patient. Some have short term needs, while others have chronic, longer-term needs. California currently has a shortage of beds for all needs; according to this study, the state needs 4,767 beds for both acute and subacute needs, and an additional 2,963 community residential beds for those with chronic needs. The report recommends the state prioritize psychiatric bed infrastructure for those with the greatest needs, and particularly those that have the most difficulty accessing beds (such as those involved in the criminal justice system). Additionally, the report notes California should require specified data collection to track the impact of its investments and makes sure funds are meeting the needs of the target populations.
VHHP Program. A majority of California’s veterans are considered cost-burdened and pay more than 30% of their income towards housing-related costs. Additionally, veterans face higher risks of homelessness than the general population and the homeless point-in-time count for 2022 estimated there were 10,395 veterans experiencing homelessness in California. In 2014, the Legislature enacted the Veterans Housing and Homeless Prevention Act of 2014, which created the Veterans Housing and Homelessness Prevention (VHHP) Program and allowed for the issuance of $600 million in bonds to provide funding for multifamily affordable housing, transitional housing, and supportive housing to veterans (AB 639, Perez). Voters subsequently approved the Act with Proposition 41 (2014). Thus far, the Treasurer has issued $148,270,000 in bonds, and $387,040,000 has not yet been issued.
VHHP is administered by the Department of Housing and Community Development (HCD) in collaboration with the California Housing Finance Agency (CalHFA) and California Department of Veterans Affairs (CalVet). VHHP funds new affordable housing for veterans and their families, which differs from the CalVet Home Loan Program, which makes loans to veterans to purchase a home, funded by the sale of GO bonds, which are subsequently repaid when veterans pay down their mortgages. Proposition 12 (2008) authorized $900 million for the CalVet Home Loan program, which Proposition 41 reduced from $900 to $300 million due to a lack of demand. Proposition 41 then reallocated the difference of $600 million for the acquisition, construction, rehabilitation, and preservation of veteran housing.
AB 2011 (Wicks). Planning and approving new housing is mainly a local responsibility. The California Constitution allows cities and counties to “make and enforce within its limits, all local, police, sanitary and other ordinances and regulations not in conflict with general laws.” It is from this fundamental power (commonly called the police power) that cities and counties derive their authority to regulate behavior to preserve the health, safety, and welfare of the public—including land use authority.
Local governments use their police power to enact zoning ordinances that establish the types of land uses that are allowed or authorized in an area. Zoning often identifies a primary use for parcels in the area, as well as other uses that are allowed if they meet conditions imposed by the local government. For example, an agricultural area may be zoned to allow agricultural uses “by right”—without local discretion—but also allow development of a single family home as an ancillary use, so that the farmer has a house to inhabit. Zoning ordinances also contain provisions to physically shape development and impose other requirements, such as setting maximum heights and densities for housing units, minimum numbers of required parking spaces, setbacks, and lot coverage ratios. These ordinances can also include conditions on development to address aesthetics, community impacts, or other particular site-specific considerations. Common zoning designations include different intensities of residential, commercial, and industrial uses, and so label those as “principally permitted uses” within those zones.
Last year, the Legislature enacted the Affordable Housing and High Road Jobs Act of 2022, which establishes certain 100% affordable and mixed-income residential projects as a use by right in specified commercial areas. The measure also imposed specified labor standards on those projects, including requirements that contractors pay prevailing wages, participate in apprenticeship programs, and make specified healthcare expenditures. To apply AB 2011’s streamlined approvals, the residential density of the project must meet or exceed the density considered geographically appropriate for affordable housing projects in Housing Element Law for 100% affordable projects. Mixed-income housing projects have to meet or exceed density and height standards that depend on the width of the commercial corridor where the project will be built, or its proximity to a transit station.
The author wants to place a GO bond before voters to finance the construction of behavioral health infrastructure, including for veterans who are either experiencing or at risk of homelessness, and who are living with a behavioral health challenge.
Proposed Law
Assembly Bill 531 enacts the Behavioral Health Infrastructure Bond Act of 2023, which places a $4.68 billion GO Bond authorization before voters at the March 2024 statewide primary election. If approved, the measure directs proceeds of bonds issued and sold to be deposited in the Behavioral Health Infrastructure Fund (Fund), which the bill creates in the State Treasury.
The measure continuously appropriates moneys from the Fund for the following:
- $865 million for making grants administered by HCD for acquiring capital assets for the construction and rehabilitation of housing for veterans and others who are experiencing homelessness, or are at risk of homelessness, and are living with a behavioral health challenge.
- Paying DHCS’s administrative costs, which cannot exceed 3% of the net proceeds of each bond sale.
- Paying the costs of issuing bonds, paying the annual administration costs of the bonds, and paying interest on bonds.
- Any remaining funds for making grants administered by the Department of Health Care Services (DHCS) for acquiring capital assets for the construction and rehabilitation of unlocked, voluntary, and community-based treatment settings and residential care settings.
AB 531 provides that a project funded by proceeds from the bonds it authorizes shall be subject to use by right subject to a streamlined, ministerial review pursuant to AB 2011. Project proponents must require contractors and subcontractors to pay prevailing wages for any construction, rehabilitation, or major alternations.
The bill also incorporates standard provisions in GO bond law, either explicitly or by reference, with some modifications. The measure creates the Behavioral Health Infrastructure Act Finance Committee (Committee) comprised of the Director of Finance, the Treasurer, and the Controller, and charges the Committee with determining whether it is necessary or desirable to issue bonds, and if so, the amount of bonds to be issued and sold.
The bill defines many of its terms, and also states legislative findings and declarations supporting its purposes
State Revenue Impact
No estimate.
Comments
1. Purpose of the bill. According to the author, “The connection between homelessness and behavioral health challenges is significant. Among Californians experiencing homelessness, nearly 40,000 have a severe mental illness and over 36,000 have a chronic substance use disorder. Among homeless veterans, over 50% suffer from mental health issues and over 70% are affected by substance use disorder. In response to this behavioral health crisis, I am proud to partner with Governor Newsom and Senator Eggman in proposing a major transformation of California’s behavioral health care system. The Behavioral Health Infrastructure Bond Act of 2023 would be the single largest expansion of California’s behavioral health system. The Act will expand access to high quality, unlocked, community –based residential care for those with the greatest needs. Additionally, it will dedicate funding to veterans with behavioral health needs who are currently experiencing or at risk of experiencing homelessness. The $4.68 billion bond includes $3.815 billion in funds that would be used to build 10,000 new clinic beds and homes. The bond also includes $865 million dedicated to house veterans with serious mental illness or a substance use disorder. Voters would need to approve the Behavioral Health Infrastructure Bond Act of 2023 at the March 5, 2024 statewide primary election.”
2. Sixteen tons. Setting the right amount of state GO debt is difficult; both the State Treasurer and the Legislative Analyst’s Office (LAO) state that there is no correct level. Instead, experts suggest that states should look at three criteria: affordability, comparability, and optimality.[2]
California currently has $67.9 billion of GO and $8.1 billion of lease revenue debt outstanding, which is affordable. The Governor’s 2021 Five-Year Infrastructure Plan estimates that the Debt Service Ratio, or the ratio between debt service and general fund revenues, as 2.68% in 2021-22, 2.84% in 2022-23, and between 2.67% and 2.7% for the next three fiscal years. Annual expenditures on debt service will grow from $2.9 billion in 2000-01 to $5.8 billion in 2025-26. Additionally, all but 1.4% in outstanding debt is paid at a fixed rate of interest. While debt service is currently a small part of the state’s budget, every dollar spent on debt service reduces the funding that is available for other priorities.
California’s comparability to other states is less favorable, but has improved significantly in recent years. The State Treasurer’s 2022 Debt Affordability Report (DAR), issued last October, contains the following information:
Debt Ratios Of 10 Most Populous States, Ranked By Ratio Of Debt To Personal Income | ||||
State | Moody’s/ S&P/ | Debt to personal income(b) | Debt per capita(b) | Debt as a % |
Texas | Aaa/AAA/AAA | 1.1% | $682 | 1% |
North Carolina | Aaa/AAA/AAA | 1.2% | $686 | 1.1% |
Florida | Aaa/AA/AAA | 1.2% | $756 | 1.3% |
Michigan | Aa1/AA/AA+ | 1.5% | $833 | 1.5% |
Georgia | Aaa/AAA/AAA | 2% | $1,087 | 1.7% |
Pennsylvania | Aa3/A+/AA+ | 2.5% | $1,616 | 2.5% |
Ohio | Aa1/AA+/AA- | 3% | $1,718 | 2.7% |
California Illinois | Aa2/AA-/AA Baa1BBB+-/BBB+ | 3.2% 4.4% | $2,458 $2,958 | 2.9% 4% |
New York | Aa1/AA+/AA+ | 5.1% | $3,871 | 4.1% |
Moody’s Median All States | 2.1% | $1,179 | 2.1% | |
Median For The 10 Most Populous States | 2.25% | $1,352 | 2.1% | |
(a) Moody’s, Standard & Poor’s, and Fitch Ratings as of August, 2022 (b) Figures as reported by Moody’s in its 2022 State Debt Medians Report based on 2021 fiscal data, except for California, which reflect fiscal 2020. (c) State GDP numbers have a one-year lag. | ||||
Determining optimality, or whether government is investing in the quantity and quality of public capital desired by residents, and financing the appropriate share with debt, is more difficult. LAO recommends that the Legislature consider the Governor’s annual Five-Year Infrastructure Plan as a starting point to developing a coordinated approach to infrastructure funding, and establish a committee to focus on statewide infrastructure.
3. The good news. Ratings issued from the three major credit rating agencies often inform investors and the public regarding the state’s creditworthiness, and assess any investment risk from investing in California GO bonds. Rating agencies Fitch, Standard and Poor’s, and Moody’s have praised California’s deep and diverse economy, recent balanced and on-time budgets, reduced budget deficits, and improved reserves and liquidity. However, the agencies also state California faces challenges: a highly volatile revenue system, constitutionally-imposed governance restrictions, high housing costs that threaten economic growth, and minimal prefunding of retiree health care benefits, among others. Once considered an outlier, the “credit spread” between California bonds and other states as measured by the benchmark 30-year Municipal Market Data Index has tightened significantly in the last ten years; credit spreads represent the difference in yield between two bonds of similar maturity but different credit quality. The DAR notes that California’s credit spread has declined from a high of more than 150 basis points at the end of 2009 to as narrow as four basis points in September 2018, and was 24 points in June 2022.
4. The bad news. California has a distinct problem: of the $156.4 billion in GO bonds that voters have authorized, around $24.4 billion hasn’t been issued yet. Among others, the state hasn’t issued more than $5.2 billion from the Stem Cell Research Bond approved in 2020, $4.7 billion from the 2014 water bond, and $3.5 billion to fund high speed rail. According to the Treasurer, the state has issued an average of $7.9 billion of GO bonds annually. The Treasurer expects similar issuance amounts in future years. While the state has made great progress reducing the amount of authorized, unissued bonds in recent years, many bond-funded projects have not yet received required approvals. Market appetite and debt service payments limit the amount of GO bonds the state can sell. As a result, projects with voter-approved bond authority, as well as any new GO bond-funded projects, may have to wait to receive the necessary cash.
5. Rates. In March 2020, in response to the COVID-19 pandemic, the Federal Open Markets Committee (Committee) cut the federal funds rate twice, setting the range between 0.0% and 0.25%. One year later, in response to rising inflation, the Committee began a series of rate increases, with a current range of 4.75% to 5%. Changes in the federal funds rates has broad effects on the economy, including for states when issuing GO bonds; higher interest rates mean borrowers pay more when borrowing the same amount of debt, all else equal. The conflict in Ukraine, the lingering impacts from the COVID-19 pandemic, and other trends have caused market fluctuations in interest rates for governments issuing tax-exempt debt. According to the DAR, until October 2021, tax-exempt rates lagged and remained low through the end of December; however, starting in January 2022, tax-exempt interest rates began to rise sharply, snapped back briefly in May and early June, but those gains reversed very quickly. Data from the state’s last four bond sales demonstrates these fluctuations:
- Bond sales between March 2020 and 2021 generally had all-in interest costs just above 2%, and yields between 0.06% and 2.58% depending on duration.
- The March 2022 sale of $2.3 billion in bonds had an all-in true interest cost of 3.09%, and yields ranging from .94% to 3.29%.
- The September 2022 sale of $2.3 billion in bonds had an all-in true interest cost of 3.93%, and yields ranging from 2.34% to 4.3%.
- The April 2023 sale of $2.6 billion in bonds had an all-in true interest cost of 3.63%, and yields ranging between 2.21% to 3.98%.
Given recent fluctuations in interest rates, it’s unclear what the true cost to the state’s General Fund will be when currently authorized, or any newly approved, bonds are sold. For example, a $4.68 billion bond with a 30-year maturity issued at a 2% interest rate would have a total debt service of $6.27 billion, or $209 million per year. The same bond issued at a 4% interest rate has a total debt service of $8.1 billion, or $271 million per year assuming the same inflation rate and yield.
6. Future attractions. Earlier this year, the Senate approved four bills to place authorizations for GO bonds before voters:
- SB 28 (Glazer) proposes $15.5 for preschool, K-12, Community College, CSU, and UC facilities. The Assembly Higher Education Committee approved the bill, which is now pending in the Assembly Education Committee.
- SB 638 (Eggman) proposes $6 billion to finance flood control efforts. The measure is set for hearing in the Assembly Water, Parks, and Wildlife Committee and is double referred to the Assembly Natural Resources Committee.
- SB 834 (Portantino) proposes $25 billion for home ownership and construction. The measure is pending in the Assembly Housing and Community Development Committee.
- SB 867 (Allen) proposes $15.5 billion for drought, wildfire, and other climate resilience projects. The Assembly Water, Parks, and Wildlife Committee approved the bill, and it is currently pending in the Assembly Natural Resources Committee.
In addition to AB 531, the Assembly also approved six other bills that place authorizations for GO bonds before voters:
- AB 247 (Muratsuchi) proposes $14 billion for K-12 and Community College Facilities. The Senate Education Committee approved the bill on June 14th, and it will also be heard at this Committee’s July 12th hearing.
- AB 305 (Villapudua) proposes $4.5 billion for flood control projects. The measure is currently pending in the Senate Natural Resources Committee, and is double-referred to the Senate Governance and Finance Committee.
- AB 408 (Wilson) proposes $3.365 billion or agricultural, food, farmworker, and climate purposes. The Senate Agriculture Committee approved the measure on July 3rd, which will also be heard at the Committee’s July 12th hearing.
- AB 1510 (Jones-Sawyer), enacts the Fighting Fentanyl Bond Act of 2024, which proposes an unspecified amount for substance use treatment, harm reduction programs, supportive services for students, programs targeting drug trafficking, substance use treatment programs in prisons and juvenile facilities, and recovery housing and transitional housing for previously incarcerated individuals. The Senate Health Committee approved the bill on July 5th, and will also be heard at the Committee’s July 12th hearing.
- AB 1567 (E. Garcia), proposes $15.995 billion to finance projects for safe drinking water, wildfire prevention, drought preparation, flood protection, extreme heat mitigation, clean energy, and workforce development programs. The bill is currently pending in the Senate Natural Resources Committee, and is double-referred to the Senate Governance and Finance Committee.
- AB 1657 (Wicks), proposes $10 billion to fund affordable rental housing and homeownership programs. The Senate Housing Committee approved the bill on June 20th, and will also be heard at the Committee’s July 12th hearing.
7. Incoming! The Senate Housing Committee approved AB 531 by a vote of 10 to 1 on July 10th. The Senate Governance and Finance Committee is hearing the bill as the committee of second reference.
8. Gut and amend. As approved by the Assembly, AB 531 enacted the Veterans Housing and Homeless Prevention Bond Act of 2024 which placed a $600 million GO bond authorization before voters to fund veterans’ housing programs. On June 19th, the author removed those provisions and inserted the current ones.
Assembly Actions
Not relevant to this version of the bill.
Support and Opposition
(7/11/23)
Support: California Professional Firefighters
City of Fowler
City of Moreno Valley
City of Perris
City of Riverside
City of Santa Monica
Steinberg Institute
The Umbrella Effect: Project Becky
Opposition: None received.
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RAND Corporation. Adult Psychiatric Bed Capacity, Need, and Shortage Estimates in California. 2021. Available at: https://www.rand.org/pubs/research_reports/RRA1824-1-v2.html ↑
Robert Wassmer and Ronald Fisher “Debt Burdens of California State and Local Governments: Past, Present and Future.” As requested and supported by the California Debt and Investment Advisory Commission. July 2011. ↑
SENATE COMMITTEE ON HOUSING
Senator Scott Wiener, Chair
2023 - 2024 Regular
Bill No: AB 531 Hearing Date: 7/10/2023
Author: | Irwin | ||
Version: | 6/19/2023 | ||
Urgency: | No | Fiscal: | Yes |
Consultant: | Alison Hughes | ||
SUBJECT: The Behavioral Health Infrastructure Bond Act of 2023
DIGEST: This bill authorizes, subject to voter approval, the issuance of $4.68 billion in general obligation (GO) to be issued to the Department of Health Care Services (DHCS) and Department of Housing and Community Development (HCD), as specified.
ANALYSIS:
Existing law:
- Authorizes the Veterans and Affordable Housing Bond Act of 2018 for the purpose of funding various housing programs; includes a $1 billion increase in the bonding authority of the California Department of Veterans Affairs (CalVet) Home Loan Program.
- Authorizes the Veterans Housing and Homeless Prevention(VHHP) Bond Act of 2014 for the purpose of funding $600 million in multifamily affordable, transitional, and supportive housing for low-income veteran households and veterans experiencing homelessness.
- Authorizes the Veterans Bond Act of 2008 for the purpose of establishing a fund to provide farm and home aid for veterans in the amount of $900 million under the CalVet Home Loan Program.
- Authorizes the Veterans Bond Act of 2000 for the purpose of creating a fund to provide farm and home purchase aid for veterans in the amount of $500 million.
- Authorizes specified housing development projects to be a use by right on specified sites zoned for retail, office, or parking, as specified, pursuant to AB 2011 (Wicks, Chapter 647, Statutes of 2022).
This bill:
- Authorizes $4.68 billion in bond funds, upon voter approval on the March 5, 2024 ballot, to be issued and sold for the following purposes:
- Making grants administered by DHCS for the acquisition of capital assets for, and the construction and rehabilitation of, unlocked, voluntary, and community-based treatment settings and residential care settings.
- Making up to $865 million in grants administered by the Department of Housing and Community Development for the purposes of constructing and rehabilitating housing for veterans and others who are experiencing homelessness or are at risk of homelessness and living with behavioral health challenges.
- Up to 3% of the net proceeds for general administrative costs.
- Paying the costs of issuing bonds, paying the annual administration costs of the bonds, and paying interest on the bonds.
- Provides that a housing project, funded by these bond funds, shall be a use by right pursuant to AB 2011, as specified. The project proponent shall pay prevailing wages to all contractors and subcontractors performing work on the project.
- Creates the Behavioral Health Infrastructure Act Finance Committee, made up of the Controller, the Treasurer, and the Director of Finance, for purposes of authorizing the issuance and sale of bonds.
COMMENTS:
- Author’s statement. “The connection between homelessness and behavioral health challenges is significant. Among Californians experiencing homelessness, nearly 40,000 have a severe mental illness and over 36,000 have a chronic substance use disorder. Among homeless veterans, over 50% suffer from mental health issues and over 70% are affected by substance use disorder. In response to this behavioral health crisis, I am proud to partner with Governor Newsom and Senator Eggman in proposing a major transformation of California’s behavioral health care system. The Behavioral Health Infrastructure Bond Act of 2023 would be the single largest expansion of California’s behavioral health system. The Act will expand access to high quality, unlocked, community –based residential care for those with the greatest needs. Additionally, it will dedicate funding to veterans with behavioral health needs who are currently experiencing or at risk of experiencing homelessness. The $4.68 billion bond includes $3.815 billion in funds that would be used to build 10,000 new clinic beds and homes. The bond also includes $865 million dedicated to house veterans with serious mental illness or a substance use disorder. Voters would need to approve the Behavioral Health Infrastructure Bond Act of 2023 at the March 5, 2024 statewide primary election.
- Homeless Veterans. A majority of California’s veterans are considered cost-burdened and pay more than 30% of their income towards housing-related costs. Additionally, veterans face higher risks of homelessness than the general population and the homeless point-in-time count for 2022 estimated that there were 10,395 veterans experiencing homelessness in California.
- California’s Housing Crisis. California has the largest concentration of severely unaffordable housing markets in the nation and the statewide average home value reached a new record in June 2022 at $793,300. To keep up with demand, HCD estimates that California must plan for the development of more than 2.5 million homes over the next eight years, and no less than one million of those homes must meet the needs of lower-income households (more than 640,000 very low-income and 385,000 low-income units are needed). For decades, not enough housing was constructed to meet need, resulting in a severe undersupply of housing.
As a result of the severe housing shortage, millions of Californians, who are disproportionately lower-income and people of color, must make hard decisions about paying for housing at the expense of food, health care, child care, and transportation—one in three households in the state don’t earn enough money to meet their basic needs. A lack of affordable housing is the biggest contributor to homelessness. As housing costs continue to rise, rent becomes less affordable for lower-income households, who are forced to live beyond their means (paying more than 30% of income on housing costs) or are pushed out of their homes, leading to rapid increases in homelessness. Variation in rates of homelessness cannot be explained by variation in rates of individual factors such as poverty or mental illness, however, cities with higher rents and lower rental vacancy rates (i.e., tighter housing markets) are directly linked to higher per capita rates of homelessness.
- Existing state veterans housing programs. Proposition 41 created VHHP Program and authorized $600 million in GO bonds to fund multifamily affordable housing, transitional housing, and supportive housing to veterans. To date, the VHHP Program has provided six rounds of funding, administered by HCD in collaboration with the California Housing Finance Agency (CalHFA) and CalVet.
No funding remains from the bond. The program funded 3,058 VHHP housing units for veterans and their families with 2,026 of those reserved for extremely low-income veterans, 813 for very low-income veterans, and 219 for low-income veterans. Additionally, 80% of the housing units developed with VHHP funds are restricted to veterans experiencing homelessness. While the VHHP funds are helping to create much-needed affordable housing, transitional housing, and supportive housing for California’s veterans, the program will run out of funding unless additional resources are approved for the VHHP program. The 2022-23 budget included $100 million in one-time general fund dollars for the program ($50 million in 2022-23 and $50 million in 2023-24).
- Need for mental health beds and existing DHCS programs. According to a recent study[1], people with mental health conditions require different levels of psychiatric beds, depending on the needs of the patient. Some need short term needs, while others have chronic, longer-term needs. California currently has a shortage of beds for all needs; according to this study, the state needs 4,767 beds for both acute and subacute needs, and an additional 2,963 community residential beds for those with chronic needs. The report recommends that the state prioritize psychiatric bed infrastructure for hose with the greatest needs, and particularly those that have the most difficulty accessing beds (such as those involved in the criminal justice system). Additionally, the report notes that California should require specified data collection to track the impact of its investments and makes sure funds are meeting the needs of the target populations.
Presently, DHCS operates the following homelessness and housing-related programs:
- Behavioral Health Continuum Infrastructure Program (BHCIP). This program finances the construction, acquisition, and rehabilitation of real estate assets or investments needed for mobile crisis infrastructure to expand the community continuum of behavioral health treatment resources.
- Community Care Expansion (CCE). This program is part of a statewide investment in infrastructure funding to address homelessness, support healthcare delivery reform, and strengthen the social safety net. CCE has two main focuses: (1) the CCE Capital Expansion Program which funds the acquisition, construction, and rehabilitation of residential care settings including funds to establish a capitalized operating subsidy reserves; and (2) the CCE Preservation Program intended to immediately preserve and prevent the closure of existing licensed residential adult and senior care facilities, including Residential Care Facilities for the Elderly, Adult Residential Facilities, or Residential Facilities for the Chronically Ill.
- Housing and Homelessness Incentive Program (HHIP). Medi-Cal managed care plans can earn incentive funds for making investments and progress in addressing homelessness and keeping people housed. Managed care plans and the local homeless Continuum of Care, in partnership with local public health jurisdictions, county behavioral health, Public Hospitals, county social services, and local housing departments must submit a Homelessness Plan to DHCS and identify how these funds would prioritize aging and disabled homeless Californians.
- New GO Bonds for behavior health beds. This bond bill would authorize $4.68 billion in GO bonds, except as noted below, for purposes of constructing and rehabilitating unlocked, voluntary and community based treatment settings and residential care settings. According to the author, these funds will help fund 10,000 new clinic beds and homes for those with the most severe health and substance abuse disorders.
- Publicly available funds for affordable housing. Prior to 1974, the federal government invested heavily in affordable housing construction. When those units began to deteriorate, the Housing Community and Development Act ended most new construction of public housing and the Housing Choice Voucher Program (Section 8) was created in its place. This new program allowed eligible tenants to pay only a portion of their rent (based on their income) and shifted funds from public housing authorities to the private sector. The goal was to eliminate concentrations of low-income people in housing developments. In 1981, the Reagan administration dismantled federal affordable housing funding. From 1978 to 1983, the funding for low- to moderate-income housing decreased by 77%. In 1970, there were 300,000 more low-cost rental units (6.5 million) than low-income renter households (6.2 million). By 1985, however, the number of low-cost units had fallen to 5.6 million, and the number of low-income renter households had grown to 8.9 million, a disparity of 3.3 million units. Federal investments have not gone back up to pre-1978 levels.
At the state level, California has invested significantly in affordable housing construction and rehabilitation in recent years through the passage of one-time discretionary actions in the budget and the passage of voter approved bonds.
Only in the last few years have the Legislature and Governor allocated General Fund dollars to affordable housing programs. Beginning in 2019, an unprecedented $8 billion from the General Fund has gone to a variety of affordable housing programs. The Veterans and Affordable Housing Bond Act of 2018 (Proposition 1), authorized $3 billion to fund state affordable housing programs and $1 billion for the CalVet program, which provides mortgages to veterans. All of the funding from the bond will be fully allocated by the end of 2023. Proposition 2 of 2018 authorized the state to issue $2 billion in General Obligations bonds against revenues from the Mental Health Services Act for purposes of funding the No Place Like Home Program (NPLH). Those funds supported the construction of over 7,000 supportive housing units and the funds are now exhausted.
It should be noted that of these investments, only funds from the Affordable Housing and Sustainable Communities program (AHSC), federal and state low income housing tax credits, and funds from SB 2 (Atkins, Chapter 364, Statutes of 2017), are ongoing sources of funding.
These investments, while critical, have not made up for decades of disinvestment from the federal level. Significant ongoing investments are necessary to meet the current undersupply of housing affordable to lower-income families.
- New GO bonds for veterans housing. This bill would provide up to $865 million of the $4.68 billion for the construction and rehabilitation of housing for veterans and others who are experiencing homelessness or are at risk of homelessness and are living with a behavioral health challenge. Additionally, the bond provides that housing projects funded by this bond will be eligible for a by right approval process for specified commercial corridors, so long as project proponents pay all contractors and subcontractors prevailing wages for any proposed rehabilitation or construction.
It is not clear why the bill specifically calls out one streamlined housing approval process, given that housing projects could utilize any streamlined approval they are otherwise eligible for under existing law. Further, any changes to the streamlining aspects of this bill would be subject to voter approval. Moving forward, the author may wish to consider removing these provisions.
- Other housing bond measures. Two other housing bonds are moving through the process this year: (a) SB 834 (Portantino), which dedicates $25 billion in general obligation bonds, subject to voter approval, for homeownership opportunities, including $18 billion for mortgage loans for first time homebuyers and $7 billion in infrastructure loans for new home construction, as specified, and (b) AB 1657 (Wicks), which authorizes the Affordable Housing Bond Act of 2024 to place a $10 billion housing bond on the March 5, 2024 primary ballot to fund production of affordable housing and supportive housing. Given the dire need for funding for affordable housing and similar to other housing bonds, moving forward, the author may wish to consider increasing the overall housing bond allocation in order to increase funding for existing affordable housing programs to support lower income households and homeless populations more broadly.
- Double referral. This bill was also referred to the Senate Governance and Finance Committee.
Related Legislation:
SB 222 (Hill, Chapter 601, Statutes of 2019) — prohibited housing discrimination on account of military or veteran status under the Fair Employment and Housing Act (FEHA). Also defined a Veterans Affairs Supportive Housing (VASH) voucher as a source of income for purposes of FEHA, and in so doing, prohibited landlords from discriminating against a tenant based on their use of a VASH voucher to pay rent.
SB 3 (Beall, Chapter 365, Statutes of 2017) — authorized the issuance of $4 billion in general obligation bonds for several affordable housing programs under the Veterans and Affordable Housing Bond Act of 2018. Approved by voters at the November 6, 2018 election, this included a $1 billion increase in the bond authority allowed under the CalVet Home Loan Program.
AB 639 (Pérez, Chapter 727, Statutes of 2013) — authorized the Veterans Housing and Homeless Prevention Act of 2014 which voters approved through Proposition 41. Additionally, restructured the Veterans’ Bond Act of 2008 (Proposition 12) and provided for the issuance of $600 million in general obligation bonds to support affordable, supportive, and transition multifamily housing for veterans and their families.
SB 1572 (Wyland, Chapter 122, Statutes of 2008) — established the Veterans’ Bond Act of 2008 which California voters approved as Proposition 12. Authorized $900 million in general obligation bonds intended to help veterans purchase single family homes, farms, and mobilehomes through CalVet Home Loan Program.
FISCAL EFFECT: Appropriation: Fiscal Com.: Local:
POSITIONS: (Communicated to the committee before noon on Wednesday,
July 5, 2023.)
SUPPORT:
California Professional Firefighters
Steinberg Institute
OPPOSITION:
None received.
-- END --
RAND Corporation. Adult Psychiatric Bed Capacity, Need, and Shortage Estimates in California. 2021. Available at: https://www.rand.org/pubs/research_reports/RRA1824-1-v2.html ↑
SENATE COMMITTEE ON HOUSING
Senator Scott Wiener, Chair
2023 - 2024 Regular
Bill No: AB 531 Hearing Date: 6/20/2023
Author: | Irwin | ||
Version: | 2/8/2023 | ||
Urgency: | No | Fiscal: | Yes |
Consultant: | Alison Hughes | ||
SUBJECT: Veterans Housing and Homeless Prevention Bond Act of 2024
DIGEST: This bill authorizes, subject to voter approval, the issuance of $600 million in general obligation (GO) bonds to provide affordable housing under the Veterans Housing and Homeless Prevention (VHHP) Bond Act of 2024.
ANALYSIS:
Existing law:
- Authorizes the Veterans and Affordable Housing Bond Act of 2018 for the purpose of funding various housing programs; includes a $1 billion increase in the bonding authority of the CalVet Home Loan Program.
- Authorizes the Veterans Housing and Homeless Prevention Bond Act of 2014 for the purpose of funding $600 million in multifamily affordable, transitional, and supportive housing for low-income veteran households and veterans experiencing homelessness.
- Authorizes the Veterans Bond Act of 2008 for the purpose of establishing a fund to provide farm and home aid for veterans in the amount of $900 million under the CalVet Home Loan Program.
- Authorizes the Veterans Bond Act of 2000 for the purpose of creating a fund to provide farm and home purchase aid for veterans in the amount of $500 million
This bill:
- Establishes the VHHP Bond Act of 2024 (VHHP Bond).
- Requires that funds under the Act be used for acquisition, construction, rehabilitation, and preservation of affordable multifamily supportive housing, affordable transitional housing, affordable rental housing or related facilities for veterans and their families.
- Defines terms for the purpose of the Act as follows:
- “Board” means the Department of Veterans Affairs (CalVet);
- “Bond” means a veterans’ bond, a state general obligation bond, issued pursuant to this article adopting the provisions of the State General Obligation Bond Law;
- Authorizes the issuance and sale of $600 million in GO bonds to provide a fund to be used for carrying out various VHHP efforts and to reimburse the General Obligation Bond Expense Revolving Fund pursuant to existing law.
- Specifies that the bonds, when sold, issued, and delivered, will be a valid and binding obligation of the State of California, and pledges the state to make punctual payments related to the bonds.
- Submits a portion of the Act to voters at the March 5, 2024, statewide primary election in accordance with provisions governing the submission of a statewide measure to the voters.
- Provides that the Legislature may, by majority vote, amend the provisions of the Act for the purpose of improving program efficiency, effectiveness, and accountability, or to further its overall program goals.
COMMENTS:
- Author’s statement. “California accounts for the 32 percent of all veterans experiencing homelessness in the United States, totaling over 10,000 veterans. This is the largest percentage from any one state in the country. Our state has in recent years made great inroads into this total; within the last two years, California reduced the number of veterans experiencing homelessness by over 1000. A large factor in this reduction has been the success of the Veterans Housing and Homeless Prevention Program (VHHP). VHHP has funded 88 projects and a total of 5665 units, with just over half of these units being designated VHHP units. These units have been imperative in reducing the amount of veterans in California experiencing homelessness. As VHHP comes closer to running out of funding, it is crucial that we pass AB 531 to ensure that this successful program can continue to help California’s veterans find housing.”
- Background. A majority of California’s veterans are considered cost-burdened and pay more than 30 percent of their income towards housing-related costs. Additionally, veterans face higher risks of homelessness than the general population and the homeless point-in-time count for 2022 estimated that there were 10,395 veterans experiencing homelessness in California.
Until 2014, the state has primarily supported veteran housing needs through the CalVet Home Loan Program. Established a century ago in 1921, the CalVet Home Loan program provides financing for qualified veterans to purchase homes, farms, and mobilehomes. However, over time, the CalVet Home Loan Program saw a marked decline in demand and, in 2014, the state pivoted to meet the changing needs of the veteran population when California voters approved Proposition 41 at the June 3, 2014 election.
- VHHP Program. Proposition 41 created the VHHP Program and authorized $600 million in GO bonds to fund multifamily affordable housing, transitional housing, and supportive housing to veterans. To date the VHHP Program has provided six rounds of funding, administered by the Department of Housing and Community Development (HCD) in collaboration with the California Housing Finance Agency (CalHFA) and CalVet
No funding remains from the bond. The program funded 3,058 VHHP housing units for veterans and their families with 2,026 of those reserved for extremely low-income veterans, 813 for very low-income veterans, and 219 for low-income veterans. Additionally, 80% of the housing units developed with VHHP funds are restricted to veterans experiencing homelessness. While the VHHP funds are helping to create much-needed affordable housing, transitional housing, and supportive housing for California’s veterans, the program will run out of funding unless additional resources are approved for the VHHP program. The 2022-23 budget included $100 million in one-time general fund dollars for the program ($50 million in 2022-23 and $50 million in 2023-24).
This bill proposes to submit to California voters a ballot proposition that would provide for the issuance of $600 million in general obligation bonds to continue the VHHP program. If approved at the March 5, 2024 election, it would allow for several years of continued funding for the development of affordable, supportive, and transitional housing for the state’s low-income veterans and their families.
- Double referral. This bill was also referred to the Military and Veterans Affairs Committee.
Related Legislation:
AB 1657 (Wicks, 2023) — includes intent language authorizing the issuance of bonds to be used to finance housing-related homeless programs and funding for affordable housing for extremely low income and very low income Californians. This bill is also being heard at this hearing.
SB 222 (Hill, Chapter 601, Statutes of 2019) — prohibited housing discrimination on account of military or veteran status under the Fair Employment and Housing Act (FEHA). Also defined a Veterans Affairs Supportive Housing (VASH) voucher as a source of income for purposes of FEHA, and in so doing, prohibited landlords from discriminating against a tenant based on their use of a VASH voucher to pay rent.
SB 3 (Beall, Chapter 365, Statutes of 2017) — authorized the issuance of $4 billion in general obligation bonds for several affordable housing programs under the Veterans and Affordable Housing Bond Act of 2018. Approved by voters at the November 6, 2018 election, this included a $1 billion increase in the bond authority allowed under the CalVet Home Loan Program.
AB 639 (Pérez, Chapter 727, Statutes of 2013) — authorized the Veterans Housing and Homeless Prevention Act of 2014 which voters approved through Proposition 41. Additionally, restructured the Veterans’ Bond Act of 2008 (Proposition 12) and provided for the issuance of $600 million in general obligation bonds to support affordable, supportive, and transition multifamily housing for veterans and their families.
SB 1572 (Wyland, Chapter 122, Statutes of 2008) — established the Veterans’ Bond Act of 2008 which California voters approved as Proposition 12. Authorized $900 million in general obligation bonds intended to help veterans purchase single family homes, farms, and mobilehomes through CalVet Home Loan Program.
FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No
POSITIONS: (Communicated to the committee before noon on Wednesday,
June 14, 2023.)
SUPPORT:
Aids Healthcare Foundation
American Legion, Department of California
AMVETS, Department of California
California Apartment Association
California Association of Veteran Service Agencies
California Builders Alliance
California Housing Partnership Corporation
California State Commanders Veterans Council
City of Thousand Oaks
Housing California
Livable California
Military Officers Association of America, California Council of Chapters
Mission Street Neighbors
NextGen California
Sacramento Regional Builders Exchange
Vietnam Veterans of America, California State Council
OPPOSITION:
None received.
-- END --
ASSEMBLY THIRD READING
ATR Bill Id:AB 531
Author:(Irwin)
As Introduced Ver:February 8, 2023
2/3 vote
SUMMARY
Authorizes, subject to voter approval, the issuance of $600 million in general obligation (GO) bonds to provide affordable housing under the Veterans Housing and Homeless Prevention (VHHP) Bond Act of 2024.
Major Provisions
- Establishes the VHHP Bond Act of 2024 (VHHP Bond).
- Requires that funds under the Act be used for acquisition, construction, rehabilitation, and preservation of affordable multifamily supportive housing, affordable transitional housing, affordable rental housing or related facilities for veterans and their families.
- Defines terms for the purpose of the Act as follows:
- "Board" means the Department of Veterans Affairs;
- "Bond" means a veterans' bond, a state general obligation bond, issued pursuant to this article adopting the provisions of the State General Obligation Bond Law;
- "Bond Act" means this article authorizing the issuance of state general obligation bonds and adopting the State General Obligation Bond Law, as amended from time to time, by reference.
- "Committee" means the Housing for Veterans Finance Committee, established pursuant to Military and Veterans Code (MVC) Section 998.547.
- "Fund" means the Housing for Veterans Fund, established pursuant to MVC Section 998.544.
- Authorizes the issuance and sale of $600 million in GO bonds to provide a fund to be used for carrying out various VHHP efforts and to reimburse the General Obligation Bond Expense Revolving Fund pursuant to existing law.
- Specifies that the bonds, when sold, issued, and delivered, will be a valid and binding obligation of the State of California, and pledges the state to make punctual payments related to the bonds.
- Submits a portion of the Act to voters at the March 5, 2024, statewide primary election in accordance with provisions governing the submission of a statewide measure to the voters.
- Provides that the Legislature may, by majority vote, amend the provisions of the Act for the purpose of improving program efficiency, effectiveness, and accountability, or to further its overall program goals.
COMMENTS
Background: A majority of California's veterans are considered cost-burdened and pay more than 30% of their income towards housing-related costs. Additionally, veterans face higher risks of homelessness than the general population and the homeless point-in-time count for 2022 estimated that there were 10,395 veterans experiencing homelessness in California.
Until 2014, the state has primarily supported veteran housing needs through the CalVet Home Loan Program. Established a century ago in 1921, the CalVet Home Loan program provides financing for qualified veterans to purchase homes, farms, and mobilehomes. However, over time, the CalVet Home Loan Program saw a marked decline in demand and, in 2014, the state pivoted to meet the changing needs of the veteran population when California voters approved Proposition 41 at the June 3, 2014 election.
VHHP Program: Proposition 41 created the VHHP Program and authorized $600 million in GO bonds to fund multifamily affordable housing, transitional housing, and supportive housing to veterans. To date the VHHP Program has provided six rounds of funding, administered by the Department of Housing and Community Development (HCD) in collaboration with the California Housing Finance Agency (CalHFA) and California Department of Veterans Affairs (CalVet).
No funding remains from the bond. The program funded 3,058 VHHP housing units for veterans and their families with 2,026 of those reserved for extremely low-income veterans, 813 for very low-income veterans, and 219 for low-income veterans. Additionally, 80% of the housing units developed with VHHP funds are restricted to veterans experiencing homelessness. While the VHHP funds are helping to create much-needed affordable housing, transitional housing, and supportive housing for California's veterans, the program will run out of funding unless additional resources are approved for the VHHP program. The 2022-23 budget included $100 million in one-time general fund dollars for the program ($50 million in 2022-23 and $50 million in 2023-24).
This bill proposes to submit to California voters a ballot proposition that would provide for the issuance of $600 million in general obligation bonds to continue the VHHP program. If approved at the March 5, 2024 election, it would allow for several years of continued funding for the development of affordable, supportive, and transitional housing for the state's low-income veterans and their families.
According to the Author
"California accounts for the 32% of all veterans experiencing homelessness in the United States totaling over 10,000 veterans. This is the largest percentage from any one state in the country. Our state has in recent years made great inroads into this total; within the last two years, California reduced the number of veterans experiencing homelessness by over 1000. A large factor in this reduction has been the success of the Veterans Housing and Homeless Prevention Program (VHHP).VHHP has funded 88 projects and a total of 5665 units, with just over half of these units being designated VHHP units. These units have been imperative in reducing the amount of veterans in California experiencing homelessness. As VHHP comes closer to running out of funding, it is crucial that we pass AB 531 to ensure that this successful program can continue to help California's veterans find housing."
Arguments in Support
According to supporters, this bill comes at a critical time when VHHP funds from the first bond have been expended. The funding in this proposed bond would provide eight years of funding for veterans housing.
Arguments in Opposition
None on file.
FISCAL COMMENTS
According to the Assembly Appropriations Committee:
- Estimated General Fund (GF) debt service payments of approximately $39 million annually and total principal and interest costs over the repayment period of approximately $1.17 billion, assuming a 30-year maturity at an interest rate of 5%. Actual costs would depend on the interest rate and the timing of the sales.
- Estimated administrative costs:
- The Department of Housing and Community Development (HCD) estimates total annual costs of approximately $3.6 million (Housing for Veterans Fund), beginning in fiscal year 2024-25, for continued staffing and operations costs associated with administering the program funded by this bond act. This total includes $330,000 annually for two additional staff positions for additional workload to HCD's Budget Office related to refunding bonds, the Pooled Money Investment Board, and potential tax consequences of interest on these bonds. HCD currently dedicates 16.0 personnel years (PY) of staff to administer the VHHP Program.
- The California Department of Veterans Affairs (CalVet) estimates annual costs of approximately $478,000 (Housing for Veterans Fund), which represents a continuation of the current resources dedicated to program administration.
- The California Housing Finance Agency (CalHFA) indicates costs would be minor and absorbable.
The 2014 VHHP Bond Act, upon which this measure is based, authorizes up to 5% of bond proceeds, or up to $30 million total, to be used for administrative purposes. If actual administrative costs exceed this cap, there could be additional GF cost pressures to the extent those additional resources are approved in future budget acts.
The Secretary of State (SOS) estimates one-time costs in the range of $546,000 to $728,000 (GF) for printing and mailing costs to place the measure on the ballot in the March 5, 2024, statewide election. This estimate assumes an average cost per page in the voter information guide of $91,000 and the addition of six to eight pages in the Voter Information Guide.
VOTES
ASM HOUSING AND COMMUNITY DEVELOPMENT: 8-0-0
YES: Wicks, Joe Patterson, Wendy Carrillo, Gabriel, Juan Carrillo, Quirk-Silva, Sanchez, Ward
ASM MILITARY AND VETERANS AFFAIRS: 11-0-0
YES: Soria, Davies, Addis, Alvarez, Boerner Horvath, Juan Carrillo, Mathis, Muratsuchi, Petrie-Norris, Ta, Valencia
ASM APPROPRIATIONS: 15-0-1
YES: Holden, Megan Dahle, Bryan, Calderon, Wendy Carrillo, Dixon, Mike Fong, Hart, Lowenthal, Mathis, Papan, Pellerin, Sanchez, Weber, Ortega
ABS, ABST OR NV: Robert Rivas
UPDATED
VERSION: February 8, 2023
CONSULTANT: Lisa Engel / H. & C.D. / (916) 319-2085 FN: 0000581
Date of Hearing: May 3, 2023
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Chris Holden, Chair
ABPCA Bill Id:AB 531
Author:(Irwin) – As Introduced Ver:February 8, 2023
Policy Committee: | Housing and Community Development | Vote: | 8 - 0 |
Military and Veterans Affairs | 11 - 0 | ||
|
|
Urgency: No State Mandated Local Program: No Reimbursable: No
SUMMARY:
This bill enacts the Veterans Housing and Homeless Prevention (VHHP) Bond Act of 2024, which authorizes the sale of $600 million in general obligation bonds upon approval by voters at the March 5, 2024, statewide primary election. Bond funds would be used to provide housing for veterans and their families pursuant to the Veterans Housing and Homeless Prevention (VHHP) Act of 2014.
FISCAL EFFECT:
- Estimated General Fund (GF) debt service payments of approximately $39 million annually and total principal and interest costs over the repayment period of approximately $1.17 billion, assuming a 30-year maturity at an interest rate of 5%. Actual costs would depend on the interest rate and the timing of the sales.
- Estimated administrative costs:
- The Department of Housing and Community Development (HCD) estimates total annual costs of approximately $3.6 million (Housing for Veterans Fund), beginning in fiscal year 2024-25, for continued staffing and operations costs associated with administering the program funded by this bond act. This total includes $330,000 annually for two additional staff positions for additional workload to HCD’s Budget Office related to refunding bonds, the Pooled Money Investment Board, and potential tax consequences of interest on these bonds. HCD currently dedicates 16.0 personnel years (PY) of staff to administer the VHHP Program.
- The California Department of Veterans Affairs (CalVet) estimates annual costs of approximately $478,000 (Housing for Veterans Fund), which represents a continuation of the current resources dedicated to program administration.
- The California Housing Finance Agency (CalHFA) indicates costs would be minor and absorbable.
The 2014 VHHP Bond Act, upon which this measure is based, authorizes up to 5% of bond proceeds, or up to $30 million total, to be used for administrative purposes. If actual administrative costs exceed this cap, there could be additional GF cost pressures to the extent those additional resources are approved in future budget acts.
- The Secretary of State (SOS) estimates one-time costs in the range of $546,000 to $728,000 (GF) for printing and mailing costs to place the measure on the ballot in the March 5, 2024, statewide election. This estimate assumes an average cost per page in the voter information guide of $91,000 and the addition of six to eight pages in the Voter Information Guide.
COMMENTS:
- Purpose. The author intends this bill to provide additional funding for affordable housing for veterans and their families by issuing $600 million in general obligation bonds to continue the VHHP Program. According to the author:
California accounts for the 32% of all veterans experiencing homelessness in the United States totaling over 10,000 veterans. This is the largest percentage from any one state in the country. Our state has in recent years made great inroads into this total; within the last two years, California reduced the number of veterans experiencing homelessness by over 1,000. A large factor in this reduction has been the success of the VHHP. The VHHP has funded 88 projects and a total of 5665 units, with just over half of these units being designated VHHP units. As VHHP comes closer to running out of funding, it is crucial that we pass [This bill] to ensure this successful program can continue to help our veterans find housing.
- Background. A majority of California’s veterans are considered cost-burdened and pay more than 30% of their income towards housing-related costs. Additionally, veterans face higher risks of homelessness than the general population. The homeless point-in-time count for 2022 estimated there were 10,395 veterans experiencing homelessness in California.
Proposition 41, approved by the voters in June 2014, created the VHHP Program and allowed for the issuance of $600 million in bonds to provide funding for multifamily affordable housing, transitional housing, and supportive housing to veterans. To date, the VHHP Program has provided six rounds of funding, administered by HCD in collaboration with the CalHFA and CalVet.
The VHHP Program funded 3,058 housing units for veterans and their families, with 2,026 of those reserved for extremely low-income veterans, 813 for very low-income veterans, and 219 for low-income veterans. Additionally, 80% of the housing units developed with VHHP funds are restricted to veterans experiencing homelessness. The VHHP Program funding will soon be depleted unless additional resources are approved for the program. The 2022-23 budget included $100 million in one-time GF dollars to sustain the program ($50 million in 2022-23, and $50 million in 2023-24).
This bill proposes to submit to California voters a ballot proposition to provide for the issuance of $600 million in general obligation bonds to continue the VHHP Program. If approved at the March 5, 2024, election, it would allow for several years of continued funding for the development of affordable, supportive, and transitional housing for the state’s low-income veterans and their families.
- Related Legislation. AB 1657 (Wicks) enacts the Affordable Housing Bond Act of 2024, which authorizes the issuance of $10 billion in general obligation bonds, upon approval by voters at the March 5, 2024, statewide primary election. Bond funds would be used to fund affordable rental housing and homeownership programs, including, among others the Multifamily Housing Program, the CalHome Program, and the Joe Serna, Jr. Farmworker Housing Grant Program. AB 1657 is pending in this committee.
- Prior Legislation. AB 411 (Irwin), 2021) would have enacted the VHHP Bond Act of 2022, similar to this bill. AB 411 was held on Senate Appropriations Committee’s suspense file.
SB 3 (Beall), Chapter 365, Statutes of 2017, authorized the issuance of $4 billion in general obligation bonds for several affordable housing programs under the Veterans and Affordable Housing Bond Act of 2018. Approved by voters at the November 6, 2018, election, this included a $1 billion increase in the bond authority allowed under the CalVet Home Loan Program.
Analysis Prepared by: Jennifer Swenson / APPR. / (916) 319-2081
Date of Hearing: April 18, 2023
ASSEMBLY COMMITTEE ON MILITARY AND VETERANS AFFAIRS
Esmeralda Soria, Chair
ABPCA Bill Id:AB 531 (
Author:Irwin) – As Introduced Ver:February 8, 2023
SUBJECT: Veterans Housing and Homeless Prevention Bond Act of 2024
SUMMARY: Authorizes, subject to voter approval, the issuance of $600 million in general obligation (GO) bonds to provide affordable housing under the Veterans Housing and Homeless Prevention (VHHP) Bond Act of 2024. Specifically, this bill:
- Establishes the VHHP Bond Act of 2024 (VHHP Bond).
- Requires that funds under the Act be used for acquisition, construction, rehabilitation, and preservation of affordable multifamily supportive housing, affordable transitional housing, affordable rental housing or related facilities for veterans and their families.
- Defines terms for the purpose of the Act as follows:
- “Board” means the Department of Veterans Affairs;
- “Bond” means a veterans’ bond, a state general obligation bond, issued pursuant to this article adopting the provisions of the State General Obligation Bond Law;
- “Bond Act” means this article authorizing the issuance of state general obligation bonds and adopting the State General Obligation Bond Law, as amended from time to time, by reference.
- “Committee” means the Housing for Veterans Finance Committee, established pursuant to Military and Veterans Code (MVC) Section 998.547.
- “Fund” means the Housing for Veterans Fund, established pursuant to MVC Section 998.544.
- Authorizes the issuance and sale of $600 million in GO bonds to provide a fund to be used for carrying out various VHHP efforts and to reimburse the General Obligation Bond Expense Revolving Fund pursuant to existing law.
- Specifies that the bonds, when sold, issued, and delivered, will be a valid and binding obligation of the State of California, and pledges the state to make punctual payments related to the bonds.
- Submits a portion of the Act to voters at the March 5, 2024, statewide primary election in accordance with provisions governing the submission of a statewide measure to the voters.
- Provides that the Legislature may, by majority vote, amend the provisions of the Act for the purpose of improving program efficiency, effectiveness, and accountability, or to further its overall program goals.
EXISTING LAW:
- Authorizes the Veterans and Affordable Housing Bond Act of 2018 for the purpose of funding various housing programs; includes a $1 billion increase in the bonding authority of the CalVet Home Loan Program (MVC Section 998.600 et seq.).
- Authorizes the Veterans Housing and Homeless Prevention Bond Act of 2014 for the purpose of funding $600 million in multifamily affordable, transitional, and supportive housing for low-income veteran households and veterans experiencing homelessness. (MVC Section 998.540 et seq.)
- Authorizes the Veterans Bond Act of 2008 for the purpose of establishing a fund to provide farm and home aid for veterans in the amount of $900 million under the CalVet Home Loan Program (MVC Section 998.400 et seq.)
- Authorizes the Veterans Bond Act of 2000 for the purpose of creating a fund to provide farm and home purchase aid for veterans in the amount of $500 million (MVC Section 998.300 et seq.)
- Provides, under the Veterans’ Farm and Home Purchase Act of 1974, programs to assist qualified veterans with purchasing homes and farms under the CalVet Home Loan Program. (MVC Section 987.50 et seq.)
FISCAL EFFECT: This bill has not been analyzed by a fiscal committee.
COMMENTS: Purpose. According to the author, “California accounts for the 32 percent of all veterans experiencing homelessness in the United States totaling over 10,000 veterans. This is the largest percentage from any one state in the country. Our state has in recent years made great inroads into this total; within the last two years, California reduced the number of veterans experiencing homelessness by over 1000. A large factor in this reduction has been the success of the Veterans Housing and Homeless Prevention Program (VHHP).VHHP has funded 88 projects and a total of 5665 units, with just over half of these units being designated VHHP units. These units have been imperative in reducing the amount of veterans in California experiencing homelessness. As VHHP comes closer to running out of funding, it is crucial that we pass AB 531 to ensure that this successful program can continue to help California’s veterans find housing.”
Background. A majority of California’s veterans are considered cost-burdened and pay more than 30 percent of their income towards housing-related costs. Additionally, veterans face higher risks of homelessness than the general population and the homeless point-in-time count for 2022 estimated that there were 10,395 veterans experiencing homelessness in California.
Until 2014, the state has primarily supported veteran housing needs through the CalVet Home Loan Program. Established a century ago in 1921, the CalVet Home Loan program provides financing for qualified veterans to purchase homes, farms, and mobilehomes. However, over time, the CalVet Home Loan Program saw a marked decline in demand and, in 2014, the state pivoted to meet the changing needs of the veteran population when California voters approved Proposition 41 at the June 3, 2014 election.
VHHP Program. Proposition 41 created the VHHP Program and authorized $600 million in GO bonds to fund multifamily affordable housing, transitional housing, and supportive housing to veterans. To date the VHHP Program has provided six rounds of funding, administered by the Department of Housing and Community Development (HCD) in collaboration with the California Housing Finance Agency (CalHFA) and California Department of Veterans Affairs (CalVet).
No funding remains from the bond. The program funded 3,058 VHHP housing units for veterans and their families with 2,026 of those reserved for extremely low-income veterans, 813 for very low-income veterans, and 219 for low-income veterans. Additionally, 80 percent of the housing units developed with VHHP funds are restricted to veterans experiencing homelessness. While the VHHP funds are helping to create much-needed affordable housing, transitional housing, and supportive housing for California’s veterans, the program will run out of funding unless additional resources are approved for the VHHP program. The 2022-23 budget included $100 million in one-time general fund dollars for the program ($50 million in 2022-23 and $50 million in 2023-24).
This bill proposes to submit to California voters a ballot proposition that would provide for the issuance of $600 million in general obligation bonds to continue the VHHP program. If approved at the March 5, 2024 election, it would allow for several years of continued funding for the development of affordable, supportive, and transitional housing for the state’s low-income veterans and their families.
HUD-VASH. The HUD-Veterans Affairs Supportive Housing (HUD-VASH) program combines HUD’s Housing Choice Voucher (HCV) rental assistance for homeless veterans with case management and clinical services provided by the Department of Veterans Affairs (VA). VA provides these services for participating Veterans at VA medical centers (VAMCs), community-based outreach clinics (CBOCs), through VA contractors, or through other VA designated entities.
Veterans Support to Self-Reliance. The Veterans Support to Self-Reliance (VSSR) Pilot Program is a subvention program to fund provision of supportive services for veterans aged 55+ with high-acuity and over who reside in permanent supportive housing (PSH) projects throughout California. Expanded on-site supportive services may include, but are not limited to skilled nursing care, medication management, peer specialists, and geriatric social workers. The pilot program will serve to test whether with these enhanced supportive services, and within the construct of Housing First and evidence-based practices, that aging veterans experiencing chronic homelessness will be able to age in place and enjoy the stable and thriving quality of life that they deserve.
The VSSR was created and funded through the 2021 budget with initial funding of $25 million to support grantees through a three-year observational and reporting period. Funds were awarded early this year to service providers in Riverside, Los Angeles, San Francisco, Sacramento, Sonoma and San Diego counties.
Related legislation
AB 1657 (Wicks, 2023) Includes intent language authorizing the issuance of bonds to be used to finance housing-related homeless programs and funding for affordable housing for extremely low income and very low income Californians. This bill is currently pending a hearing in the Assembly Committee on Housing and Community Development.
AB 411 (Irwin, 2021) would have enacted the Veterans Housing and Homeless Prevention Bond Act of 2022, which would have authorized the sale of $600 million in general obligation bonds, upon approval by voters at the March 5, 2024 statewide primary election. Bond funds would have been used to provide housing for veterans and their families pursuant to the Veterans Housing and Homeless Prevention (VHHP) Act of 2014. Held in Senate Appropriations.
AB 684 (Irwin, 2019) would have enacted the Veterans Housing and Homeless Prevention Bond Act of 2020, which authorized the sale of $600 million in general obligation bonds, upon approval by voters at the November 3, 2020 statewide general election. Bond funds would have been used to provide housing for veterans and their families pursuant to the Veterans Housing and Homeless Prevention (VHHP) Act of 2014. Held in Senate Appropriations.
SB 222 (Hill, Chapter 601, Statutes of 2019): Prohibited housing discrimination on account of military or veteran status under the Fair Employment and Housing Act (FEHA). Also defined a Veterans Affairs Supportive Housing (VASH) voucher as a source of income for purposes of FEHA, and in so doing, prohibited landlords from discriminating against a tenant based on their use of a VASH voucher to pay rent.
SB 3 (Beall, Chapter 365, Statutes of 2017): Authorized the issuance of $4 billion in general obligation bonds for several affordable housing programs under the Veterans and Affordable Housing Bond Act of 2018. Approved by voters at the November 6, 2018 election, this included a $1 billion increase in the bond authority allowed under the CalVet Home Loan Program.
AB 639 (Pérez, Chapter 727, Statutes of 2013): Authorized the Veterans Housing and Homeless Prevention Act of 2014 which voters approved through Proposition 41. Additionally, restructured the Veterans’ Bond Act of 2008 (Proposition 12) and provided for the issuance of $600 million in general obligation bonds to support affordable, supportive, and transition multifamily housing for veterans and their families.
SB 1572 (Wyland, Chapter 122, Statutes of 2008): Established the Veterans’ Bond Act of 2008 which California voters approved as Proposition 12. Authorized $900 million in general obligation bonds intended to help veterans purchase single family homes, farms, and mobilehomes through CalVet Home Loan Program.
REGISTERED SUPPORT / OPPOSITION:
Support
Aids Healthcare Foundation
American Legion, Department of California
Amvets, Department of California
California Apartment Association
California Association of Veteran Service Agencies
California Housing Partnership Corporation
California State Commanders Veterans Council
Housing California
Military Officers Association of America, California Council of Chapters
Mission Street Neighbors
New Livable California Dba Livable California
Nextgen California
Vietnam Veterans of America, California State Council
Opposition
None on file.
Analysis Prepared by: Christian Burkin / M. & V.A. / (916) 319-3550
Date of Hearing: March 29, 2023
ASSEMBLY COMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT
Buffy Wicks, Chair
ABPCA Bill Id:AB 531 (
Author:Irwin) – As Introduced Ver:February 8, 2023
SUBJECT: Veterans Housing and Homeless Prevention Bond Act of 2024
SUMMARY: Authorizes, subject to voter approval, the issuance of $600 million in general obligation (GO) bonds to provide affordable housing under the Veterans Housing and Homeless Prevention (VHHP) Bond Act of 2024. Specifically, this bill:
- Establishes the VHHP Bond Act of 2024 (VHHP Bond).
- Requires that funds under the Act be used for acquisition, construction, rehabilitation, and preservation of affordable multifamily supportive housing, affordable transitional housing, affordable rental housing or related facilities for veterans and their families.
- Defines terms for the purpose of the Act as follows:
- “Board” means the Department of Veterans Affairs;
- “Bond” means a veterans’ bond, a state general obligation bond, issued pursuant to this article adopting the provisions of the State General Obligation Bond Law;
- “Bond Act” means this article authorizing the issuance of state general obligation bonds and adopting the State General Obligation Bond Law, as amended from time to time, by reference.
- “Committee” means the Housing for Veterans Finance Committee, established pursuant to Military and Veterans Code (MVC) Section 998.547.
- “Fund” means the Housing for Veterans Fund, established pursuant to MVC Section 998.544.
- Authorizes the issuance and sale of $600 million in GO bonds to provide a fund to be used for carrying out various VHHP efforts and to reimburse the General Obligation Bond Expense Revolving Fund pursuant to existing law.
- Specifies that the bonds, when sold, issued, and delivered, will be a valid and binding obligation of the State of California, and pledges the state to make punctual payments related to the bonds.
- Submits a portion of the Act to voters at the March 5, 2024, statewide primary election in accordance with provisions governing the submission of a statewide measure to the voters.
- Provides that the Legislature may, by majority vote, amend the provisions of the Act for the purpose of improving program efficiency, effectiveness, and accountability, or to further its overall program goals.
EXISTING LAW:
- Authorizes the Veterans and Affordable Housing Bond Act of 2018 for the purpose of funding various housing programs; includes a $1 billion increase in the bonding authority of the CalVet Home Loan Program (MVC Section 998.600 et seq.).
- Authorizes the Veterans Housing and Homeless Prevention Bond Act of 2014 for the purpose of funding $600 million in multifamily affordable, transitional, and supportive housing for low-income veteran households and veterans experiencing homelessness. (MVC Section 998.540 et seq.)
- Authorizes the Veterans Bond Act of 2008 for the purpose of establishing a fund to provide farm and home aid for veterans in the amount of $900 million under the CalVet Home Loan Program (MVC Section 998.400 et seq.)
- Authorizes the Veterans Bond Act of 2000 for the purpose of creating a fund to provide farm and home purchase aid for veterans in the amount of $500 million (MVC Section 998.300 et seq.)
- Provides, under the Veterans’ Farm and Home Purchase Act of 1974, programs to assist qualified veterans with purchasing homes and farms under the CalVet Home Loan Program. (MVC Section 987.50 et seq.)
FISCAL EFFECT: Unknown
COMMENTS:
Author’s statement: According to the author, “California accounts for the 32 percent of all veterans experiencing homelessness in the United States totaling over 10,000 veterans. This is the largest percentage from any one state in the country. Our state has in recent years made great inroads into this total; within the last two years, California reduced the number of veterans experiencing homelessness by over 1000. A large factor in this reduction has been the success of the Veterans Housing and Homeless Prevention Program (VHHP).VHHP has funded 88 projects and a total of 5665 units, with just over half of these units being designated VHHP units. These units have been imperative in reducing the amount of veterans in California experiencing homelessness. As VHHP comes closer to running out of funding, it is crucial that we pass AB 531 to ensure that this successful program can continue to help California’s veterans find housing.”
Background: A majority of California’s veterans are considered cost-burdened and pay more than 30 percent of their income towards housing-related costs. Additionally, veterans face higher risks of homelessness than the general population and the homeless point-in-time count for 2022 estimated that there were 10,395 veterans experiencing homelessness in California.
Until 2014, the state has primarily supported veteran housing needs through the CalVet Home Loan Program. Established a century ago in 1921, the CalVet Home Loan program provides financing for qualified veterans to purchase homes, farms, and mobilehomes. However, over time, the CalVet Home Loan Program saw a marked decline in demand and, in 2014, the state pivoted to meet the changing needs of the veteran population when California voters approved Proposition 41 at the June 3, 2014 election.
VHHP Program: Proposition 41 created the VHHP Program and authorized $600 million in GO bonds to fund multifamily affordable housing, transitional housing, and supportive housing to veterans. To date the VHHP Program has provided six rounds of funding, administered by the Department of Housing and Community Development (HCD) in collaboration with the California Housing Finance Agency (CalHFA) and California Department of Veterans Affairs (CalVet).
No funding remains from the bond. The program funded 3,058 VHHP housing units for veterans and their families with 2,026 of those reserved for extremely low-income veterans, 813 for very low-income veterans, and 219 for low-income veterans. Additionally, 80 percent of the housing units developed with VHHP funds are restricted to veterans experiencing homelessness. While the VHHP funds are helping to create much-needed affordable housing, transitional housing, and supportive housing for California’s veterans, the program will run out of funding unless additional resources are approved for the VHHP program. The 2022-23 budget included $100 million in one-time general fund dollars for the program ($50 million in 2022-23 and $50 million in 2023-24).
This bill proposes to submit to California voters a ballot proposition that would provide for the issuance of $600 million in general obligation bonds to continue the VHHP program. If approved at the March 5, 2024 election, it would allow for several years of continued funding for the development of affordable, supportive, and transitional housing for the state’s low-income veterans and their families.
Related legislation
AB 1657 (Wicks) (2023) Includes intent language authorizing the issuance of bonds to be used to finance housing-related homeless programs and funding for affordable housing for extremely low income and very low income Californians. This bill is currently pending a hearing in this committee.
SB 222 (Hill, Chapter 601, Statutes of 2019): Prohibited housing discrimination on account of military or veteran status under the Fair Employment and Housing Act (FEHA). Also defined a Veterans Affairs Supportive Housing (VASH) voucher as a source of income for purposes of FEHA, and in so doing, prohibited landlords from discriminating against a tenant based on their use of a VASH voucher to pay rent.
SB 3 (Beall, Chapter 365, Statutes of 2017): Authorized the issuance of $4 billion in general obligation bonds for several affordable housing programs under the Veterans and Affordable Housing Bond Act of 2018. Approved by voters at the November 6, 2018 election, this included a $1 billion increase in the bond authority allowed under the CalVet Home Loan Program.
AB 639 (Pérez, Chapter 727, Statutes of 2013): Authorized the Veterans Housing and Homeless Prevention Act of 2014 which voters approved through Proposition 41. Additionally, restructured the Veterans’ Bond Act of 2008 (Proposition 12) and provided for the issuance of $600 million in general obligation bonds to support affordable, supportive, and transition multifamily housing for veterans and their families.
SB 1572 (Wyland, Chapter 122, Statutes of 2008): Established the Veterans’ Bond Act of 2008 which California voters approved as Proposition 12. Authorized $900 million in general obligation bonds intended to help veterans purchase single family homes, farms, and mobilehomes through CalVet Home Loan Program.
Double referred: This bill was also referred to the Assembly Committee on Military and Veteran’s Affairs where it will be heard should it pass out of this committee.
REGISTERED SUPPORT / OPPOSITION:
Support
California Association of Veteran Service Agencies (Sponsor)
AIDS HealthCare Foundation
American Legion, Department of California
AMVETS, Department of California
California Apartment Association
California Housing Partnership Corporation
California State Commanders Veterans Council
Housing California
Military Officers Association of America, California Council of Chapters
Livable California
Vietnam Veterans of America, California State Council
Opposition
None on file.
Analysis Prepared by: Lisa Engel / H. & C.D. / (916) 319-2085
Discussed in Hearing
48MIN
Senate Floor
1MIN
Senate Standing Committee on Appropriations
16MIN
Senate Standing Committee on Governance and Finance
11MIN
Senate Standing Committee on Housing
2MIN
Assembly Floor
7MIN
Assembly Standing Committee on Military and Veterans Affairs
5MIN
Assembly Standing Committee on Housing and Community Development
Bill Author
Bill Co-Author(s):
