Senate Standing Committee on Housing

Senate Housing Committee will come to order. Good afternoon. The Senate continues to welcome the public in person and via the Teleconference Service for individuals wishing to provide public comment today. The participant number is 877-226-8163, 877-226-8163 and the access code is 694-8930, 694-8930 we are holding our Committee hearings here in the O Street building, and I do want to ask all Members of the Committee to be present here in room 2200 so we can establish our quorum and begin our hearing. That would be appreciated.

We have 12 bills on today's agenda with four items on consent, and we obviously are not going to be able to establish a quorum at this time, so we will defer calling the role, and I don't know if we have any authors present or. Senator, I'm present. Senator Blightzer, your Bill is on consent. You're welcome to present, but we probably don't want to snatch that one from the jaws of victory.

All right, so, yes, I would be honored to present my Bill, which is file item five, if the Vice Chair is willing to allow that at this time.

Yes.

Go down.

Good luck.

All right. First Bill up on the dock this morning is SB 405 by Senator Cortese. Welcome, Senator. You may go when you're ready to go.

Thank you, Mr. Chair. Appreciate that very much. Thank you to you and to the Members present. I'd like to start off by thanking Chair Wiener and his staff for working with us on this Bill. I will be accepting the Committee's amendments, and I know those are very important going forward. We appreciate all the work that was done to get us to this point.

Under SB 405, the Department of Housing Community Development would create a pilot program that incorporates a probability of development analysis into its evaluation of the land inventory's adequacy, since sunlight is said to be the best disinfectant. This Bill would also require local governments to submit an electronic copy of its inventory of land suitable for residential development and post the most recent version of its land inventory on its website. The need for this transparency is evidenced by HCD in many examples.

In one example, rejecting Orange County's housing element since a public school and a sheriff training center were listed as part of that housing element. While HCD does everything they can to ensure local governments are in compliance, staff shortages and the sheer size of these reports mean undevelopable sites can and will slip through the cracks. Crucially, HCD only decided to not approve the housing element after developer and approusing groups challenged the plan that's referencing the Orange County situation.

The state should not have to rely on the public to flag problematic housing elements. These procedural issues have led academics familiar with the state's housing policy to urge the adaptation of a probabilistic RHNA method. We cannot keep underutilizing a housing tool at our disposal while thousands of our constituents live on the streets. However, a fundamental change in the RHNA process requires an incremental approach, and that's why SB 405 will create a pilot program to glean best practices for broader implementation.

With us today to testify, I hope. Yes, he is Cornelius Burke, Vice President of Legislative Affairs, the California Building Industry Association, and we expect Corey Smith, Executive Director of the Housing Action Coalition. And I respectfully ask for your aye vote. Thank you.

Hey, Mr. Burke. Welcome.

Good afternoon, Mr. Vice Chair and Members of the Committee, Cornelius Burke with the California Building Industry Association. On behalf of California's home builders, we are proud to sponsor and support SB 405. This Bill will help make housing elements more reliable by ensuring that the site's list are actual viable. Currently, housing element law does not require landowners intention to be a factor in determining the adequacy of the sites that local governments designate to meet their fair share of regional housing needs.

This Bill will finally fix that problem by requiring HCD to develop a pilot program, as just mentioned, to really understand the adequacy of the site's inventory for housing element law. The changes to housing element law under SB 405 will greatly improve housing elements and make them more reliable and useful for effective housing and land use planning. As we all know, as we talk about every day, California is deeply entrenched in a housing crisis in terms of both affordability and supply.

The imbalance between supply and demand has driven California's housing costs to be the highest in the nation. To address our housing crisis, we respectfully urge the passes of SB 405 so we can eliminate the barriers and impediments to housing development, and finally, in the first time in the state's housing history, do real planning. Thank you so much. We respectfully urge an aye vote on SB 405.

Thank you, Mr. Burke. And did Mr. Smith come in? Do we have another person?

Unfortunately, he's still stuck in Committee.

Still stuck in Committee? We don't call it stuck. We have the privilege of attending. Yes. So with that, we'll go to the room. Is there anybody in the room would like to stand up in favor of the Bill? If not, this time, we'll go to opposition. Do we have any opposition witnesses in attendance you'll be a primary witness for the opposition. Very good. Go ahead, sir.

Good afternoon, Chair Seyarto, Members of the Committee, Chris Lee here today on behalf of the Urban Counties of California. It's an association of the 14 largest counties in California, as well as the League of California Cities, the Rural County Representatives of California, and the California Chapter of the American Planning Association. We all had an opposed position on the Bill as in print.

Want to thank the Committee for a good analysis that recognized a lot of the issues that we were raising with the Bill and look forward to reviewing the amendments. I think the approach outlined in the analysis has some merit, but I think we want to really carefully consider what are the components of the pilot project? What are the requirements there? Do local jurisdictions have the opportunity to opt in? And just heard today about the posting requirements.

That's been something that we've had issues with in the past as well. So thank you for the amendments today. Look forward to continuing our work with the author. We have a lot of respect for, and thank you.

All right. Thank you very much. Do we have anybody else who is in maybe opposition, not seeing anybody who coming to the mic, AT&T operators will go to the phone lines for opposition or support for this Bill SB 405.

Of course. Ladies and gentlemen, if you wish to make a comment in support or opposition, please press one, then zero. And there's currently no one queuing up at this point.

Well, then in that case, we'll bring it back to the dais. Senator Blakespear, do you have a question?

How did you know?

Go ahead.

Well, thank you to the author for bringing this Bill forward. I just want to say that, I want to say on the record, I prefer the original Bill without the amendments. I think it's really important that we think about the RHNA process and its capacity to provide housing. And as we know the phrase garbage in, garbage out, if we don't have good sites that are going into the process that are likely to produce housing, we're not going to have housing coming out the other end.

So I wanted to understand better. I'm reviewing what it says here that it says the authors agreed to amend the Bill to create a likelihood of development methodology, starting with a pilot program. So I don't fully understand what that means, but I was wondering if you or anybody lead witness or staff or anyone you'd like to call on could explain that to me.

Let me take a stab at it, and if I'm deficient, then we can go to the lead witness. The Bill originally, as originally drafted, was admittedly heavy on notification processes, and that probably wasn't a good thing for the long term survivability of this Bill. Again, the way it was written, I think conceptually there are ways to come back in the future and deal with that issue a lot more effectively and efficiently than the way we originally outlined it.

But in the meanwhile, the methodology that's outlined in the amendments is worth exploring on a pilot basis. And as you know from your work and local government, Senator, that would simply take one region's willingness, one COG, basically, to come along and say, we're willing to take this on, which will yield a lot of really good information for us, and I think, balance things out. You know, the tension.

There's been, we heard the opposition today, we listened to them carefully and work with them carefully, and we will continue to do so in the future. But let's face it, the tension between HCD, regional entities and local governments is going to be there no matter how we try to clean this up in the future. I just think this is a way for us to move forward in one good incremental step.

Okay. Yeah, I mean, I would just say, I don't think this is one of those things that it just doesn't seem to me like we really need to overthink it. So when my city was in litigation over our housing element, HCD required a letter of interest from a property owner in order to be on the list. And so if there was an idea to have a property, and one Council Member said, well, what about that property?

Then the city staff would say, well, in fact, we wrote them a letter and they said that they're not interested in development because you can't go higher on that site, and they want to, and whatever the reasons were. So that was instructive back to the council to make decisions. So to me, it seems like having.

I understand there are staff constraints at the city level, but having a process that's straightforward, getting a letter, receiving one back to me, that seems like something that could be possible in the future. It seems like there might be many generations of this idea. So I just wanted to put that out there as my feedback. So thank you. I will be supporting it today.

Thank you. I appreciate the feedback, and I think in my own mind, those thoughts are not exclusive, mutually exclusive to this approach right now. This probability methodology is something that is worth going forward with right now. But if you want to do that, Bill you're talking about, I'd be happy to be your principal co author. So hopefully we can keep pursuing this issue area.

I just want to make it clear that given all the work the Committee staff has done, that that's not on the table right now, just this methodology. And I'm happy to proceed this way. Thank you.

All right. If any of my other colleagues have questions, I would encourage you to get over to the express elevator down to the second floor in room 2200 and join us. But with that, Mr. Cortese, would you like to close?

Yes. As I said, we'll continue working on the details of this, any that remain to be addressed with opposition. I'm glad to hear that they like the amendments, and with that, I'd respectfully ask for your aye vote.

And when the appropriate time comes, we'll get a motion to do that after we've established a quorum. So at this time, I'm going to turn the gavel back over. Apparently not to Mr. Cortese. Apparently going to keep going, looking for authors. So if you're an author of a Bill that is on the Housing Committee agenda today, get down here. First come, first serve. Right now.

So at this time, the Housing Committee is going to recess for a few minutes. We have conflicting committees going on. We'll recess until we get an author to come on in. Thank you.

Good afternoon. We're resuming our Committee on housing. We have Senator Wahab. Welcome, Senator Wahab, you're here to present Bill number.

555. Yes.

Please proceed when you're ready.

Thank you. Good afternoon. Chair and Members of the Housing Committee, I want to thank the sponsors and the many organizations in support of SB five. Five. The vision for this Bill is supported by a statewide coalition of organizations because we all know that to solve the shortage of stable affordable housing, we cannot continue to nibble around the edges of this problem.

I have often talked about one yes, the housing problem is one of the things that we need to focus on in regards to development, but it's not development alone. Many on both sides of the aisle acknowledge that we have a long term shortage of affordable housing. The current system of policies do move the needle from tax credits to density bonus laws to inclusionary requirements to rental assistance.

All of these tools are helpful, but they still rely primarily on private, for profit development, which will never get us the amount of Low income affordable housing we do need. Without coordinated, purposeful action to invest in and build the housing people need, the affordable housing crisis in California will continue to worsen. In fact, 80% of Low income renters are rent burden and meaning they pay over 30% of their income towards rent.

We know that 25% of renters spend more than half of their income on rent alone. In fact, the actual poverty line definition does not even include housing. And these are just all the things that clearly show that we have significant problems when we're addressing housing and affordability. Our most vulnerable populations, such as seniors, people with disabilities, and foster youth to whom we owe a specific duty of care, are disproportionately affected by this crisis.

For example, 46% of all extremely low income households are seniors or people with disabilities, and older adults are the fastest growing age segment of the homeless population, as the number of 65 year olds who experience homelessness is estimated to triple by 2030. To meet the growing needs of these Californians, the state needs to facilitate the development of more than 140,000 Low income affordable units annually over the next eight years.

Currently, we are far from meeting this demand, as deed restricted Low income affordable unit development remains below 20,000 per year. For each year we fail to meet our Low income affordable housing need, we further and further get away from the goal of making sure that all people are housed. SB 555 sets the ambitious goal to create 1.2 million low income affordable housing units over the next 5 and 10 year periods.

The Department of Housing and Community Development will be responsible for developing a master plan to achieve these goals. This master plan will outline specific state actions for the acquisition, preservation and production of stable, affordable housing. By permanently sheltering these units from perverse market forces, we can ensure that they remain affordable for those who need them the most. SB 55 puts California on a realistic path to addressing the housing crisis, improving the lives of lower and middle income residents, and reducing homelessness.

Finally, I would like to introduce Shanti Singh, Legislative Director, with tenants together and eventually. Janine Ekosi is the Director of Housing justice initiatives at Faith in the Valley, for being here today and testifying in support of SB 55 chair, anytime you're ready. My witnesses is ready to speak. Thank you.

We'll now move on to lead witnesses. Please proceed when you're ready.

Thank you, Committee Members, my name is Shanti Singh, and I am the Legislative Director at tenants together. We are a coalition of almost 60 renter led community organizations across the state. I am also chair of the San Francisco Housing Stability Fund Oversight Board, which is a city body to recommend policy on social housing acquisition and production strategies. Though I'm not speaking my official capacity as chair today. Tenants together as Members, we're really proud to co sponsor SB 555.

Our Members represent California renters and families in big cities, suburbs, exurbs, farm communities and everywhere in between. Our Members have increasingly been looking to social housing solutions as a necessary tool to end our housing shortage. We're really proud to be here with broad support from housing, environment, labor and other groups across California. Just a little bit about the Bill SB 555 accommodates an entire mixed income spectrum of Rentford and Californians, from extremely Low to moderate income.

If you are facing difficulty in accessing the housing market, if your opportunities to build wealth and stability are threatened by real estate speculation in any community, social housing should be a choice that is available to you. What SB 55 does is set an emotion and action plan for both housing acquisition and production. Whether because of expiring deed restrictions or speculation on naturally occurring affordable housing, we are losing housing options for rent burden or cost burden Californians faster than we can build them right now.

While measures to reduce barriers to affordable housing construction are a critical part of the equation, we also need to have a concurrent conversation about the investment and resources that are going to be required to make projects possible. I'll say that Los Angeles, San Francisco, where I live personally, Oakland and other cities have recently passed initiatives to authorize and Fund many social housing models. We see new land trusts forming in the Central Valley and Inland Empire. Californians are taking local initiative.

But we need a state level action plan that is sensitive to local conditions while identifying underutilized state resources like financing mechanisms, untapped public lands, et cetera, to help bring down costs. SB 555 would entrust HCD with the same expertise that they brought to bear during our housing element process, coordinating with local agencies, nonprofits and tenants on the ground. It's intentionally flexible across a range of alternative housing models that reflect the diversity of needs and on the ground realities in a state as big as California.

From public and nonprofit operated rental housing to cohousing land trusts and permanently affordable equity cooperative ownership opportunities. We know that the state needs to have broad and difficult conversations, bigger than one Bill or one budget cycle, about long term resources and investment in housing. And we respectfully urge your ivo on SB 555 to help move this conversation forward.

Thank you.

Thank you very much. Do we have any other lead witnesses in support of SB 55? Welcome.

Thank you. Good afternoon. Thank you for having me. My name is Janine Nkosi. I am a Professor of sociology at Fresno State, the Director of housing for Faith in the Valley, and we organize across five counties of the San Joaquin Valley, 336 miles, 13 cities, representing 80,000 families that are absolutely being traumatized and crushed under the real estate speculative market. I recently got to travel to Vienna with some of your colleagues and bear witness to an incredible social housing system.

It was really incredible to be there, to see that Vienna is the world leader in tackling homelessness. A hundred years ago, they had the worst housing system in all of Europe. But today, they are a beacon of what is possible when we transform housing away from the speculative market. 100 years ago, their system was similar to what we're experiencing in some ways. In California, they had a population of about 2,030,000. People were visibly unhoused, and thousands more were living and trapped in slum conditions.

Today, they have a population of about 1.9 million, and there is virtually no visible unhoused people. The most recent estimates show that as far as people who don't have a roof, we're talking about folks that are in the hundreds. Compare that to Los Angeles, a population of around 3.8 million, where we know that there are 28,000 documented unhoused folks, or San Diego, where there's a population of 1.3 million, and there are 4000 unhoused folks.

There's so many things that I wish that I could share with you about Vienna, because they are getting so many things right, historically and today. But I only have time to just share a few things and one of the things is that the government observed what was happening, the terrible living conditions that people were suffering through. And they prioritized housing as their number one priority. And they declared a commitment to make housing a human right. That's what SB 55 is going to do.

It's going to set California on a pathway toward realizing housing as a human right. The other thing that they did was they invested in and institutionalized the settlement movement. So all of those tens of thousands of people that I was telling you, they took up land on the periphery of the city. They built housing, they grew their own food, they cultivated the land. They created a public construction company, a public utility, and the government invested in those systems. They formed cooperative associations.

And we learned when we were there that 80% of the cooperative companies that were formed then are still in existence today. Vienna has been on 100 year journey. We're not going to get there overnight. We have a long way to go, but we have a blueprint for what's possible. We have an established infrastructure. We have community land trusts. We have cdcs. We have public housing authorities. We have mission driven affordable housing developers and Cooperatives.

And the thing about social housing, which we heard from Shanti, is that it comes in many forms, from municipally owned housing to cooperatives to limited housing, on partnerships, to gentle density renewal, temporary emergency housing. And so I really encourage all of you to vote yes on SB 55 so that we can put California on a pathway to transforming our social housing and scaling it up. Thank you so much.

Thank you very much for your testimony. Now we're going to move on to continued support for SB 55 here in room 2200.

Madam Chair Member Sarah Flocks, California Labor Federation, in support.

Thank you, Madam Chair Members. Rand Martin, here, on behalf of the AIDS Healthcare foundation and AIDS Healthy Housing Foundation, which has created more than 1400 units for extremely and very Low income people across the City of Los Angeles in strong support of this very important Bill. Thank you.

Thank you.

Madam Chair and Members. Darkenion Bird, American Federation for State, county and Municipal Employees in support of SB 55.

Thank you.

Madam Chair and Members.

Reverend Ray Huang, senior organizer with Housing Now Housing Justice Coalition, made up of over 150 partners and organizations. Strong yes, for us.

Chairman Members. Andres Ramos, on behalf of Public Advocates, as co sponsors, in strong support. Thank you.

Miller Saltzman with Power CA action, in strong support.

Thank you, Madam Chair Members. Joe Shakarnik, with the state building trades. We're in support. Thank you. Good afternoon.

Matt Lajay, on behalf of SCAU California, in support. Eric Payne, Executive Director of the Central Valley Urban Institute in strong support.

Thank you. All right. Do we have any other witnesses in support here in room 2200? Seeing none will now move into our lead witnesses in opposition of SB 55 here in room 2200.

Madam Chair, Members of the Committee, Jennifer Speck, on behalf of the California Association of Realtors, here in opposition to SB 55, we are specifically seeking amendments to exempt acquisition of market rate housing. Remember, 10 years ago, we had a median housing price of just $300 to $400,000 within the State of California. We continually suffer from a housing shortage, and we are 2.5 million units short of what we need in order to satisfy demand.

1.5 million of those units are market rate units that create housing affordability opportunities for our entry level market rate families that are seeking to create wealth opportunities and generational wealth. The Bill currently permits the acquisition of single family homes as well as other opportunities within its purview. We are asking that the Bill, if it's really intended to create housing supply within the State of California, that the resources that are created within it are used to create new housing. New housing is what we need.

The idea that we simply move the deck shares around on a ship that's sinking from housing affordability is not the right thing to do. We're looking at a median housing price of $820,000, even with really high interest rates between five and 7%, which we haven't seen in over 15 years. While we appreciate the author's goals, we really do want to be a partner in creating a supply solution to this problem.

And again, to respectfully request that the acquisition of single family homes be removed from the Bill. Thank you.

Thank you very much. Do we have any other lead witnesses in opposition to SB five? 55 seeing none, we will now move on to witnesses within room 2200 in opposition to SB five. 55 seeing none, we'll now move on to our witnesses waiting to testify via the teleconference service. Mr. And Mrs. Moderator.

Ladies, if you wish to make a comment in support or opposition, please press one, then zero.

Thank you, Mr. Moderator.

Sorry. Go ahead.

No worries. Thank you, Mr. Moderator. And for those waiting to testify via the teleconference service, both in opposition and in support, please state your name, your organization and your support status, whether you're support or oppose the Bill. SB 55.

And we'll now be going to line 70. Please go ahead.

Nicole Wartelman, on behalf of the children's Partnership, in support.

Next, we'll be going to line 68. Please go ahead.

Raquel Mason, on behalf of the California Environmental Justice Alliance, in strong support. Thank you.

Next we'll be going to line 74. Please go ahead.

This is Leo Goldberg on behalf of the California Community Land Trust Network, in strong support of SC 555.

And there's currently no one else in the queue, Madam Chair.

Thank you, Mr. Moderator. If you wouldn't mind checking the queue one more time, just to make sure that we've had the opportunity to hear from all of our support and opposition witnesses. Be very grateful for the opportunity.

Of course. Ladies and gentlemen, once again, if you wish to make a comment in support or opposition of SB 555, please press one, then zero. Thank.

Thank you.

And there's currently no one still queuing up.

Madam Chair. Thank you, Mr. Moderator. Now we want to thank all of our witnesses, both in support, in opposition to the Bill of SB 55 both here, and those who testify via the teleconference services. We're now going to bring it back to our Committee Members. Do we have any comments or questions? Yes, Senator. Yes.

Thank you. Well, first, I want to thank the Senator for introducing this Bill. I think it's really important, and I recognize and appreciate the passion and the eloquence of the two Members who spoke in support today. So the lead witnesses, I think two things I want to say. The first is I absolutely agree that the private sector should not be primarily and exclusively responsible for building affordable housing in this state. I think that has not worked.

And so having public sector involvement in building affordable housing so that we can reduce and then eliminate our homeless population and the suffering that goes along with living outside and not having a home to call one's own, I think should be a top state priority. I appreciate that this Bill houses that responsibility in HCD because to me, it makes sense conceptually that that is the branch and the arm of our government that is managing housing. And so this should be a responsibility of HCD.

And I hope that we can continue to empower them to take this on as a role. It's really important that we have an action plan for production and that we actually produce. So I'm interested in both of those things, but not exclusively the plan, but the actual production. So I will definitely be supporting this today and hope to continue doing a lot more in this area. So thank you for bringing it forward.

Thank you.

Thank you. Senator Blakespear, do we have any other comments? Senator, the Artem so this is a.

Tough subject to be tackling. It's been tried to tackle. People have tackled it before. We have an uphill climb in this respect because California, I think, has failed miserably, along with the rest of the nation, in creating public housing. And so it has a stigma attached to it that we have to overcome. But there's also the issue of what's happened here in California specifically.

And specifically, we just didn't keep up with our housing because we had a lot of regulations that impeded the progress of building housing. And that's not just housing at the affordable rate. There used to be no such thing as the Low affordable housing because that just used to be the apartments. When you're ready to move out of mom and dad's house, you've moved into an apartment, sometimes with a friend, sometimes not.

But what we've created through the years of trying to help people is we've locked them into those apartments and now they don't have move up, they don't have the ability to go to the next townhome and buying a townhome, and then they don't have enough to buy a house. So everybody's kind of locked in. And the solution of just continuing to build the lowest amount that they're locked into, the lowest product that they're locked into, I don't know, is going to help us a lot.

I'm really concerned. I don't want to create what we have created in the past because they have really concentrated all of the poor, the people who can't afford a home, into one area. And those areas have become really blighted or over the years, they are blighted and they're dangerous, and they produced a stigma to them. It's kind of hard to get people on board to go down this path.

I think removing the barriers like we've been trying to do, to allow all types of housing to be built is probably an approach that I think we need to continue to take and let work a little bit before we take even more drastic measures. I don't know what the politics are in Vienna. I don't know how their tax structures or anything like that. I was trying to find out.

I wasn't not paying attention, I was just doing research while you guys are talking and listening at the same time. So I'm not sure that that's something that is, for me, it's super supportable right now because I like to make sure there are assurances that we don't produce what we have done in the past because they wound up being, nobody took care of them. And not just the tenants, but the state who owned the housing did not take care of them.

And they themselves turned into a social disaster for the people that live there. And I served in those communities before, and those were the toughest projects to go into and where we needed the most protection when we did. And so I fear those kind of projects going down the wrong path. And so for me, I need assurances that this actually turns into something that's helpful, but doesn't lock people into that small housing forever.

I know a lot of kids that can afford to move up, but they don't have anything to move up into. And so they're staying in their rent controlled apartment because there's no reason to leave yet. They can and that would free up those apartments. There's a lot of apartments being built right now, and in the past, when we built that many apartments, boy, rents would drop. We need to see if that's going to happen.

I'd like to see the apartments that are coming on board now that were planned in the 2000s start coming on board and see what happens with rents and see if we can push those down. But without other people being given the opportunity to move up and move up housing, I don't know how this gets fixed that way. So that's just kind of where I sit.

I have a lot of concerns about this approach, but I'm probably in the minority as far as those concerns are, but not in the minority of people who have actually gone into those projects and seen what the result was.

And Senator, I do appreciate your concerns about this. I think it's the concerns that many of us actually do share. I want to highlight a couple of things. Number one, that this is a plan, right? And so as this is initiated, you can genuinely share your concerns with HCD as they incorporate a master plan to develop more affordable housing.

I do also want to state that it's not just the state government that has some significant influence on housing, and the state has largely, in the last couple of years, focused more on development and trying to streamline some of the concerns you have to make it easier and simpler for developers. I fully support those efforts, but I also want to highlight that local land use laws are created at the local level as well. So each city is very different.

So when you reference rent control, rent control also is decided upon by the local jurisdictions. Number one, when we talk, and I served in the local City Council, when we talk about in Lou fees.

Above. Market rate housing is a priority for a lot of cities because they rely on the revenue generated by the property tax of higher income homes. And oftentimes those in Lou fees are paid to ensure that there's a bucket of money that can develop the 100% affordable housing and so forth. So that is one of the concerns that I have.

I personally believe, as a principal, that low, very low and extremely low income housing should be attached to all types of developments in order to make sure that we avoid, as you stated, areas that are more blighted and so forth. I think we have a lot of work to do in making sure that those rules are established to control some of the efforts that are happening, that are well intentioned, but potentially also more harmful. So I think we're in agreement on that.

And again, that this is primarily just a study and a plan to really understand what can we do with incorporating some of the concerns that you have, that I also share.

[Roll Call]

Okay, good. Do we have any other Members with any comments or questions regarding SB 555. Okay, before we move forward with a vote, we're going to establish a quorum. You have enough numbers? Madam Secretary, if you would please call the roll.

Perfect.

Thank you very much. We have established a quorum. Thank you to the Members who have made it to the dais. I had just one question for you, and that had to do with the concerns that the Association of Realtors had with. Have you considered doing or working with the Association of Realtors to address the concern of taking an amendment to exclude existing houses? Housing. Speak.

Exclude existing housing.

I think that's what the comment was. Right. I'm sorry. We can clarify. What was the concern?

Single family, one to four. So that's typically what is defined as owner occupied housing, because you can owner occupy one unit and then rent out the additional two or three. It also is contained with an ADU law where you can have up to three units per parcel, where you have a single family home, plus a junior ADU and an ADU.

So what we're seeking to do is to facilitate the entry level market rate housing that we're having a really hard time constructing, which is consistent with what the Senator is looking to do to create those entry level ownership opportunities would be to exempt the existing ones that we have. We'd like to find more ways to develop more entry level housing. But given how the fee structures work, generally, we do see more luxury housing getting built. When you talk about above market rate.

That's what that is to us, the impact that it has.

So we are willing to work with all people. But I also just want to be clear that this is a plan. We want to see exactly what the studies clearly show us, number one. Number two, I also want to be very clear that the units that are currently, for example, in Alameda County, we have 9474 homeless individuals that have been identified in the last point in time count with over 30,000 vacant units. So that's number one.

Number two is the fact that AdUs and junior AdUs are already exempted from rent control and a lot of other affordability actions, if you will. So, as I stated, I'm happy to work with all people, but I also just want to highlight that there are certain things that are already taking place that provide for a lot of exemptions, and we need to take a look at the entire housing picture when we're tackling the affordability crisis, not just carve outs and carve outs and carve outs.

I think that that has become one of the concerns about a lot of the state laws and what's happening now.

Thank you. All right, I see no other comments or questions from our Members. Would you like to call the role? Oh, we need a motion. Sorry. Senator Blakeshire has made the motion, and. I'm sorry. Yes, closing comments.

Thank you. I respectfully ask for an aye vote.

Perfect. There you go. This is Senate Bill 555 by Senator Wahab. The motion is do passed, and we refer to the Committee on Appropriations.[Roll Call]

The vote is six to one for our absent Members. Thank you very much. Thank you.

Okay, so we have the opportunity to take up the consent calendar. Do we have a motion? Thank you, Senator Cortese. We have a motion by Senator Cortesi. Madam Secretary, would you mind calling the role on the consent calendar, which consists of file items 126 and 8?

[Roll Call]

We'll hold the roll open for our absent Members. We can go ahead and open the roll for Senator Cortese's Bill. No worries. Madam Secretary. We need a motion on Senator Cortese's. Senator Blakespear has made a motion.

This is Senate Bill 405 by Senator Cortese. The motion is do pass as amended, and re-refer to the Committee on Appropriations. [Roll Call].

Madam Secretary, if I may just ask a question. Since I wasn't here for the comment, Senator Cortese, would you mind taking a question? Oh, it's too late? Okay, then I'm going to abstain on this one. Sorry. I'm going to change my vote. Oh, shoot. Okay, then we'll keep it. We'll follow up. Thank you. Okay. Senator Padilla, would you like to present your Bill at this time? Perfect. Welcome, Senator Padilla.

Which bill would you like to take on first?

I think the next--in file item order--SB 352, if I may.

Perfect. Yes.

Madam Chair, Members, it's my pleasure to be here today to present SB 352, which for the very first time would require the California Workforce Development Board, in concert with the Secretary of Labor and Workforce Development and the Director of Housing Community Development, to examine housing costs by county and create a formula establishing how much the local minimum wage should be for a full time worker to reasonably afford housing and basic expenses in that county, as well as to calculate statewide averages, report them to the legislature annually.

It would require--excuse me, sorry. A growing segment, Madam Chair, and Members of the workforce, in California is economically stranded. What I mean by that is that the economic mobility that their predecessors had only a few decades ago does not exist anymore. A larger and larger segment of our entry level workforce, no matter--are required to work more and more hours to meet their basic needs. No matter your politics or your perspective, this is simply not sustainable, even as a business model.

Because of inflated and predominantly rising housing and living costs, low wage and entry level workers must now work unsustainable number of hours per week just to meet the demands of these costs. It has trapped them in a cycle of working poverty which allows them none of the economic mobility their predecessors had. California does not now have, nor has it ever, established a methodology to determine a wage standard that accounts for an individual's cost of living. SB 352 would change that.

Information is power, and effective public policy in these cases should be data driven. I represent some of the poorest and most disadvantaged communities in the state, and I believe that our social contract is broken. Workers are not progressing. They are not gaining, saving, building wealth, securing housing or their basic needs, or advancing the market value of their labor. These workers are working more, many 80 to 90 hours per week, and they cannot afford basic housing.

Current data informs that California has one of the highest and most generous minimum wages in the nation and at the very same time suffers from one of the highest poverty rates in the nation due to high living expenses driven primarily by housing and childcare cost. By gathering data, we can begin to understand the scope officially, at long last.

Because we did establish a minimum wage, nearly a century ago, we can finally begin to understand the scope of what working poverty looks like in the State of California. We must honestly assess what this looks like in order to effectively address it so we can develop thoughtful strategies to make sure that none of our communities and no segment of our workforce falls behind.

I'm happy to say that with me today from the United Ways of California is Danielle Bautista, and from the United Way Bay Area, TaShon Thomas, director of public policy. Following their testimony and of others, I would respectfully ask for an aye vote.

Thank you, Senator Padilla. We'll now move on to lead witnesses in support of SB 352. Please proceed when you're ready.

Hello, Chair and Members. My name is Danielle Bautista with United Ways of California, and our organization represents the statewide network of all local United Ways, covering all counties. As proud sponsors of SB 352, we support the creation of a living wage formula that would take into account local housing costs and the cost of basic expenses. In the State of California, a minimum wage earner would have to work more than two full time jobs to afford a one bedroom apartment in most major markets.

Those work hours alone are not sustainable. Should someone juggling multiple jobs be put into a situation where they should miss a day or more of work? That's money they'll miss out on earning and putting towards housing, bills and more. Now, according to the US Department of Housing and Urban Development, for housing costs to be considered affordable, these total costs should not exceed 30% of household income.

To put this in perspective, for the six regions of the state that the Senate Housing Committee Members represent, I'll now share what percentage of households in that area pay 30% or more on housing. And these statistics are from our real cost measure, which is our study on what it takes for households to meet basic needs in the state. In the greater Los Angeles region, it's 42% of households. Greater San Diego region, it's 40% of households.

Inland Empire region, 37% of households. Central Valley region and Northern California region both are at 36% of households. And Bay Area region at 33% of households. Housing inflation, housing supply, general inflation and low wages have all contributed to a high cost of living here in California. And no one knows that better than minimum wage earners who struggle to get by. If someone works one full time job, at a minimum, they should be able to cover their housing and basic expenses.

In closing, by sharing--I'll close by sharing that the knowledge that SB 352 would provide would make clearer to us what investments are needed in order to improve systems that can uplift Californians. For these reasons, United Way of California offers its full support for SB 352 by Senator Padilla and urge your aye vote. Thank you.

Okay. Any additional support?

Good afternoon, Chair and Senators. My name is TaShon Thomas, and I'm the public policy director for the United Way Bay Area. For over 100 years, UWBA has worked towards creating an equitable Bay Area by mobilizing the region to assist people living in poverty to dismantle its root causes. Today, I stand in support of SB 352 and thank Senator Padilla for bringing this vital piece of legislation up for consideration.

For years, wages for low-income residents and working families have become stagnant compared to the increasing cost of basic needs. The United Ways of California has created a data point called the real cost measure. Unlike the official poverty measure, which primarily accounts for food, the real cost measure factors the cost of housing, health care, childcare, transportation and other basic needs to reveal what it really costs to live in California.

SB 352 would help better understand the financial gaps families have to meet their basic needs, which in turn give wage earners more leverage to advocate for livable wage. So since this is the Housing Committee, let me bring it home to each one of you by making you aware of the real cost measure for your region. Of course, the Bay Area has the highest cost for a family of four, meaning two working adults, one toddler and one school-aged child.

In the Bay Area, you would need at least $107,000 in order to survive, with Marin, San Francisco and Santa Clara counties exceeding more than $120,000. For Orange County, a family would need at least $101,000. For the Inland Empire and San Diego, both, $77,000. And even in the Central Valley, it will cost about a family about $70,000 just to sustain their basic needs.

It's important to note that these numbers do not include inflation after the pandemic and in fact, will be part of our real cost measure at the end of this year. When we know the numbers behind what it costs to live in this state versus living paycheck to paycheck, we'll have the power to act to address these gaps. SB 352 does that and will help assist policymakers at all levels of government to make key budget decisions regarding the minimum wage. The United Way stands in support of SB 352 by Senator Padilla and urges your aye vote.

Thank you. Additional support.

Good afternoon. Alejandro Solis, on behalf of the Mexican American Opportunity Foundation in support. Thank you.

Hello. Matt Lege on behalf of SEIU, California in support.

Mr. Chair and Members, Sarah Flocks, California Labor Federation, in support. Thank you.

Jeff Neal for the City of Chula Vista, also in support.

Moira Topp on behalf of the City of San Diego, in support.

Any additional support? Comments? Okay, is there any opposition in the hearing room? Seeing none. We'll go to the phone lines. Will the moderator please queue up any remote testimony?

Of course. Ladies and gentlemen, if you wish to make a comment in support or opposition of SB 352, please press 1, then 0. And we do have someone that has queued up, one moment while they're given their line number.

And we'll be going to line 76. Please go ahead, nav.

Meet for your on behalf, full employees Association and support. Thank you.

And there's currently no one else. Mr. Chair.

Thank you. We'll bring it back to the Committee. Colleagues, any questions or comments or a motion? Yes, Senator.

So given the scenario that one of your witnesses has brought up the $70,000 figure a year, that's $36 an hour. And a lot of jobs don't require the skills to pay $36. And, in fact, if you did that to a lot of businesses, they wouldn't be in business anymore, or they would have to pass the costs along to the consumer, which creates more inflation, which just kind of builds on the problem.

So a lot of the jobs that we're talking about were never meant to sustain a family. They were secondary jobs, secondary to breadwinner jobs. And so it seems to me that the bigger issue is, are we bringing in the type of jobs to California, like, say, semiconductor jobs, where people can make $70,000 a year because they've developed their skills to the level that they can move up into those jobs? Entry level jobs were never meant to go buy a house with.

If I were still in my entry level job at TGY, they still existed today, I would not have my house, I can guarantee you. But what it did do is teach me skills for the next level of job, which taught me skills for the next level of job. Have you given much thought to how this is going to contribute to inflation, the very inflation that we're saying is driving the process, which means that 70,000 turns into $90,000. What's your thought on that?

Thank you, Mr. Chairman and my distinguished colleague. Thank you for the question. And I think it's precisely the point. First, I want to clarify that the Bill does not establish or amend the statute that established the minimum wage for the State of California. It builds on the deficit, which is the fact that the State of California, nearly a century ago, working off the example, the Federal Government decided there needed to be a minimum wage.

And the public purpose behind that wage was that folks could have a quote unquote, proper living that was not defined. It has never since been defined, nor has any methodology to establish the basis for what a minimum wage, if we're going to have one, should be. So we've decided as a state for over a century to allow a minimum wage statute to exist, but we haven't defined how and how that should look.

And this Bill seeks to collect that data and to report that out to us so that we can think creatively, maybe about threshold standards for social safety net programs, maybe about incentives for large scale private sector employers that we can provide in future legislation or policy making if they adopt a better standard that they can absorb because they had the margins to do it and move a segment of their workforce that is bunking up with three other families to rent an apartment can now afford housing.

The point you make, Mr. Chairman and Senator, is simply this. The time you described, and I think we're about the same age, was a different time. The relative buying power 50 years ago of a wage earner was a fraction of what it is today, and the cost of living were a fraction of what it is today.

People were able to work a minimum wage job early in their working career and yet have the time to go to school, learn a trade, get an education to increase the marketability of their labor that does not exist today.

The problem we face in California is that people have to work 80/90 hours a week to hit the baseline because of the demand on the cost side and the low wage compensation that you could do with 20 hours a week 40 or 50 years ago while you went to night school. They are trapped in this cycle of working poverty. They don't have the time to advantage themselves of the social programs or go to night school.

A mom bussing tables 90 hours a week with small kids who can't afford rent is going to bed when she gets home. And so we need to start with data. We need to start with understanding honestly and respectfully, uncomfortably what working poverty looks like in California. And that's what this Bill does.

And we don't have other organizations that are already doing this type of work. We need a law making this part of the workforce Development Board great.

Mr. Chairman and colleague, I think it's a great question, and I think we do need it because are we going to repeal a minimum wage law in California? I mean, it exists, but yet there is no standard, and they're not even a study.

And this Bill, for the first time would require the state, not advocacy organizations, but our own internal departments, to report and collect and analyze independent of any other agenda, pro or con, what that looks like every year, and put it in our lap and analyze that specifically with a link to housing costs because it is a main driver. And the inability of people to even afford affordable housing while working 80 hours or more a week is an element of the housing affordability crisis.

And so I think that this Bill requiring this analysis and reporting every year is potentially a very critical tool not just for General economic development, individual economic development, but to address the housing crisis as well.

Senator Ochoa-Bogh.

Yes, thank you. So valid points on, points well taken, both on Senator Seyarto's, which I also echo the concerns that he has. And I also want to just emphasize that I get the gist of the Bill and understand why there would be a need. Here's some just thoughts that I've been processing as you folks are sharing this one.

Within this data that's being collected, has there been any consideration as to a true entry wage worker to accommodate both our teen, our youth that enters the workforce and they're not intended to be paid to afford housing per se, but we do need a wage that accommodates those youth, 15 and a half, 16 year olds, 17 year olds who are supposed to be entering and learning those entry level skill sets to be able to work in committees, because I have spoken to many chambers and rop institutions, and we're missing that gap of where we're supposed to accommodate these kids before they enter the real world, but not necessarily be able to be paid what they need to be.

So I'm not sure if you've considered that, but that's something that probably should be gathered as the data on that end. So you actually have a true entry level wage and then you have a living wage that should be considered based on the demographic. The other concern, not concern, more of a comment.

The other factor that I think needs to be considered when we're gathering this data and the cost of living and what that wage should look like to be livable is the impact that policy has on the cost of living in California because you can increase the cost of living to a living, quote unquote, living wage per county, which I think it's a good thought to have.

But that also, as Senator Ciarto stated, will also have an impact on inflation with the goods and services of those industries that will be providing that living wage.

So just adding to the component, so another factor to be considered is a study or gathering data on the impact of policy on the cost of doing business, which attributes to the cost of living in California and when it comes to housing, because that's what we're dealing here in this Committee is the fact of the policies that we have in place and how that impacts the cost of housing and developing and housing.

Because from a realtor's perspective, from a construction perspective, which I come from, I can tell you that policy also has an impact on housing in itself and why that has exasperated in the past couple of years. And we can, happy to sit down on that. But those are some other factors of data that are data points that should be considered and gathered in order to really have a holistic perspective on the impact of policy on the cost of living.

And yes, what that would look like, but all of it impacts the cost of living and how it won't matter how much we pay people if policy continues to exasperate the cost of living in California. So just some thoughts on that. But I'm going to support the Bill today. But I just would love for you to take those comments and those considerations as we move forward.

And I'd love to see, I do want to see what the final Bill looks like, and I do want to Reserve the right to change my vote depending on what we see in that study. But thank you very much, and I appreciate your intent.

Thank you. Senator Blakespear,

Just briefly, I just want to say I appreciate your deep thought on this subject, and I'm happy to.

Support the Bill today.

Is that a motion? A motion by Senator Blake Spear. Any additional comments? Senator Cortese

Also briefly, I made some more extensive comments at the Labor Committee, but I do see the Bill as exactly how the author has framed it. It's really taking a look at what's happened over the last 30 years or more in terms of the degradation of the relative value of minimum wage versus the cost of living.

It's not a critique as much on housing costs as it is a critique on sort of the flat place we found ourselves in, or worse, when it comes to minimum wage, data is worth getting, it's worth looking at, and then let the debate continue. That's what I would say. Thank you for bringing the Bill forward.

Thank you. Any additional questions or comments? Okay, we have a motion by Senator Blakespear. Do pass to the Committee on appropriations. I want to thank you for your work on this, and you may close.

Thank you, Mr. Chairman. Just briefly, we find ourselves in a circumstance where more and more of California's workforce are, in fact, relying on low wage or minimum wage or entry level wages to survive and to live. The dynamic has changed, and they are not economically upwardly mobile, even though they are working 80 or 90 hours a week. The data proves this out.

This Bill simply seeks to be able to look at the demand side and report to us in a fairly comprehensive manner every year what that looks like for working Californians. And I would respectfully ask for your aye vote.

Thank you very much. Well, I'll call the roll.

[Roll Call] That's 6 to 1.

Okay, six to one. We'll put that bill on call. We'll now go to item number four, SB 713. Senator Padilla, you may present.

Thank you, Mr. Chairman, for allowing me to present SB 713, which clarifies that for purposes of the state density bonus law, development standards in quotes, means those adopted by the local government or enacted by the local government's electorate, exercising its local initiative or referendum power. Whether that power is derived from the California Constitution, from statute, charter or ordinance of the local government.

California, as you well know, is in the midst of a housing crisis, and every step we take is vital to bridge the gap between housing supply and demand. This measure would clearly articulate state law as developers and cities collaborate and seek to build new units of housing that are compliant with state law. It codifies a recent technical assistance memorandum from the Department of Housing Community Development that explicitly restates existing law that local governments cannot impose standards to stop state density bonus projects from moving forward.

This greater certainty allows developers to proceed with confidence to develop more housing more quickly. This bill is needed because affordable housing developers cannot afford to waste extremely limited and important funding unnecessarily delays. It would simply provide much needed clarity streamlining affordable housing projects by preventing trivial delays. By restating and explicitly clarifying existing law, SB 713 will reduce building costs and significantly increase production. With me today is Dante Golden from the San Diego Housing Federation.

Following testimony, Mr. Chairman and Members, I would respectfully ask for an aye vote.

Thank you. Mr. Golden.

Good morning, Chair and Members. My voice is a little gone, so I'll try and make this brief. My name is Dante Goldman, senior director of policy at the San Diego Housing Federation. Our organization represents the affordable housing sector in San Diego County and more than 75 organizational Members across the state. We're a proud sponsor of SB 713 and like to thank the Committee housing staff for their work with our coalition on the recent amendments that better align the language with the intent of this legislation.

Senate Bill 713 will clarify that a local government may not apply any development standard that precludes a project seeking density bonus, even if the standard is adopted by the electorate through a local initiative or referendum power. This legislation is consistent with laws governing state preemption, providing clarity to local governments in greater certainty for developers pursuing projects that meet these requirements. Without SB 713, proposed developments will likely not move forward due to the lack of legal clarity in the state and state bonus law.

And now it applies to local regulations enacted by a voter initiative. This bill will address the challenge head on, make it easier for our communities to deliver the housing we need to make a dent in the housing crisis. Thank you.

Thank you. Any additional support in the hearing room, please come forward.

Mr. Chair. Senator Dean Grafilo, on behalf of the California Life Sciences, in support of SB 713, appreciate the author's leadership on this issue. Thank you.

Hello, Chair and Senator. Patrick Bouteller, on behalf of IQHQ Incorporated, in support of this bill. Thanks.

Good afternoon. Cornelious Burke with the California Building Industry Association in support of the bill.

Any additional support in the room? Seeing none, is there any opposition to the bill? Seeing none. We'll go to the phone lines. Moderator, is there anyone on the phone lines?

Ladies and gentlemen, if you wish to make a comment in support or opposition of SB 713, please press one.

Thank you very much. We'll bring it back to the committee. Colleagues, any questions or comments on the bill? Senator Seyarto?

You know, I've been really in favor of what you're trying to do with just streamlining processes so that we can get, get housing built and things like that.

One of the things I've seen, one of the trends I've seen recently, taking advantage of some of the laws that we have done is we have to be careful that we don't tip the scales, put our thumb on the scale too much for one side or the other if you're talking about local governments on one side and also building on the other side, because once you do that, what you wind up is with projects that are frankly hideous, four walls and windows, and that creates a stigma for the people that live there.

And that's one of the reasons I've seen affordable housing, totally affordable housing built with design standards that make it simulate into the community so that it is not something for somebody to be embarrassed that they say, hey, I kind of live over there. I grew up in areas like that. People wouldn't tell you where they'd be embarrassed, frankly, to tell their friends where they lived or they wouldn't bring their friends over.

And I don't want that kind of housing to be created by taking all of the power away from local governments to say, hey, you know what? We understand we're going to do some affordable housing and we're going to try and streamline this process and reduce expenditures there. But having some kind of development standards, design standards is actually part of making a product in a community that everybody can be proud of, including the people that wind up buying or renting in those communities.

So I'm a little concerned that we're starting to get there because I'm starting to see evidence of it. And cities are trying to claw back a little bit, but they're being very limited in what they can request. And sometimes I've watched some of the video on some of these hearings, and frankly, I'm seeing arrogance as far as trying to address the issues that cities like to see when building something that they know they have to have built.

So does your bill further erode that opportunity for cities to create and ensure that design standards that are actually probably one of the least expensive parts of the building process aren't being cast aside in favor of, hey, just build it and they can't do anything about it? That kind of an attitude.

Mr. Chairman, Senator, thank you for great question, and frankly, I do agree in part, disagree in part with a critique. And certainly the bonus law is one that should be evolving with the policy goal of helping to facilitate the production portable housing units as a major factor in increasing affordability.

The bill simply clarifies the definition of development standard to include consistency with the fact that it can't be preempted merely by the fact that there was a local plebiscite or a ballot measure that was adopted by the electorate. And it simply clarifies that the statute, as you know, already prohibits the enactment by ordinance or by popular vote requirements or regulations that would have the actual effect or the intended effect to put a chilling effect on the production of affordable housing for its own sake.

This simply adds the language to the definition of the development standard in a way that makes that clear. So, with respect, my answer would be no.

Any other questions or comments? Senator Ochoa Bogh.

Just one final comment, and I understand the merit of the bill. I get that. The concern that I personally have, as you mentioned, just mentioned, is the fact that, as I understand it, the HDD would have the ability to serp local voting measures. And that's the one thing that I'm hesitant about in the bill, is the fact that if voters, local voters, vote on something, and then we come in and say no, the vote of the people is not relevant in this case.

We're going to have the authority to overstep that. That makes me a bit nervous, quite frankly, and would love to hear your comments on that because otherwise I'm going to have to stay off on that measure. But that's the part where I respect the people's vote, and I'm hesitant about that. But I would love to hear your comments.

Thank you, Mr. Chairman. Senator, thank you for the question, and I have great respect for the perspective. I would simply just reiterate that the bill seeks to clarify the fact that adopting regulations that are intended clearly to frustrate existing state statute for the purpose of putting a chilling effect basically on the production of housing, or to frustrate the production of housing for its own sake is already prohibited by law.

And as I know, the chair and the members are well aware, there is a doctrine in our legal system of preemption, and federal statutes often preempt, depending on the question, statutory schemes that are enacted by the state legislatures and further the statutory schemes that we enact as a state legislature supersede or preempt local ordinances that are in conflict with that.

So it's consistent with U. S. law and California law, that if the state has enacted a statute that is in effect, local ordinances cannot frustrate that or contravene that. If there is a question of which scheme preempts or controls, it would be the state statute.

The existing law clearly states that efforts, again, by ordinance, by popular vote, that are designed, in fact, to frustrate the production of housing or to frustrate the density bonus law itself, are preempted by the state law over local law, whether they are enacted by a city council board or by popular vote. And that is just consistent with existing law. The bill here just clarifies the fact that a development standard can include something adopted by a local jurisdiction by popular vote.

Great. Any other questions? Senator Blakespear?

Yeah, I just want to follow up on, you just explained it extremely well, but there are many things that we don't allow local governments. Like, for example, you ask people, would, do you want to have property tax in the city? And people would say no, but we have a state goal of providing housing. We have many laws that are aimed at that, that apply to both general law and charter cities.

And so making it really clear that when there is a conflict between a locally adopted initiative and a state law, that the state law trumps. Because we do have this preemption doctrine. To me, that makes a lot of sense, and it's really important that we clarify it. You have an example from your own county right here that is listed by the committee consultant, and I think it just shows the need for having a bill like this.

So I just want to say thank you for bringing it forward. And it seems to me like it makes a lot of sense to pass this.

Is that a motion?

It is a motion. It's definitely a motion. Thank you.

Thank you. Any other questions or comments? I see none. I want to thank the author for bringing this forward, and also I want to thank the author for the amendments you made to the bill. The original version of the bill is something I fully supported, but it was, in my view, a complete restatement of existing law. And now you have something that's a really solid clarification to make sure there's no uncertainty.

So I think it's a really good bill, and I'm really appreciative that you are bringing this forward. I do just want to say I appreciate Senator Seyarto's comments, but I will say this as someone who lives in a 500 square foot condo in a 39 unit building built in 1965, that would, would, no one would ever accuse it of winning an architectural award anywhere. Some would call it boxy and boring, and it's not in any way beautiful.

I'm really thrilled that I get to live there in a city that I would struggle to afford if I didn't have that 500 square foot condo, it would have been great to buy a single family home or some huge, more beautiful condo in San Francisco. I couldn't afford that when I bought, and I wouldn't be able to afford it today. In fact, I probably wouldn't be able to afford my own boxy, boring 500 square foot condo today. So I feel really lucky that I'm there.

And that's really what this is about, whether we're serious about people having enough places to live. And if San Francisco, when my 39 unit building was built in 1965, had had some quote unquote development standard that had the effect of meaning you can only build 22 condos instead of 39 condos. And that's what we're talking about. We're not talking about design standards to make it look good. It's more design standards that have the effect of chopping off stories and reducing the number of units.

Then that's 17 fewer units in my building, and I may not have a place that I have today. So I think it's a good balance. Cities are still able to apply objective design standards. This doesn't take that away in any way, and I support those objective design standards.

It frustrates me too, when developers build things that are gratuitously ugly because they use a cheap finish or whatever, but when you have quote unquote design standards that chop a project in half or make it impossible to actually use the density bonus, that's what this is getting at. And that's the same whether or not a city council or the voters passed an ordinance.

If a school board passes an ordinance to say we're only going to have 30 days a year of schooling, that would be a violation of state law. I think everyone would agree you have to have a minimum number of days on the same law. If the voters passed that same ordinance instead of the school board, we would still say, we wouldn't say, well, the voters passed it, so therefore it's different. Doesn't matter who passed it. If it violates state law, it violates state law.

So that's just my take, and I appreciate you bringing this forward. And we have a motion by Senator Blakespear to pass to the governance and finance committee. And you may close.

Thank you very much. Mr. Chairman. I want to thank you and your office for your collaboration and guidance on this matter as well. I respectfully ask for an aye vote.

Great. We'll call the roll.

[Roll Call] Six to zero.

Okay, that has six votes. We'll put it on call. We will now go to Senator Caballero, who has three bills, excuse me, four bills, my my. And Senator. Instead of doing them in order, I'd like to ask if we could take up item number 12, SB 747 first, only because you and I worked on that a bit, and I'm going to have to present a Bill on another Committee soon. I want to make sure I'm here for this Bill. If that's okay with you.

That's fine.

Okay, so we'll start with item number 12, SB 747.

Thank you, Mr. Chair and Members, I'm pleased to present Senate Bill 747, which would make important changes to the California Surplus Land Act to provide clarity to its application and allow flexibility for local governments to develop economic opportunities that are critical to the goal of affordable housing production. First, I'd like to extend my sincerest gratitude to the Chair and Committee staff for working together on this issue. I will accept the following Committee amendments today.

A: remove, require the jurisdiction have a compliant housing element and have achieved a pro housing designation; B: remove the language regarding conclusive standards; and C: shorten the lease term from 35 to 15 years. I look forward to continued work with the chair and this Committee should the Bill move forward today. For decades, redevelopment agencies, or RDAs, were equipped with broad community revitalization authority and financing powers.

A core feature of the former RDA tool was that it enabled local agencies to acquire properties and assemble land that could be used to revitalize deteriorated neighborhoods and attract and expand new businesses and jobs to the community. After RDAs were eliminated in 2011, the Legislature recognized that local agencies needed new economic development tools and enacted a variety of laws, including state economic opportunity law, to authorize local agencies to acquire and dispose of property for economic growth.

Since the enactment of the economic opportunity law in 2017, local agencies have utilized this tool to acquire deteriorated buildings, underutilized lots and other properties, often in underinvested neighborhoods and downtowns, with an eye to future sale or lease of these properties to advance private sector reinvestment. All this to revitalize neighborhoods to create economic opportunity. When a local jurisdiction acts to dispose of property excess to its need, property acquired with the goal to pursue economic opportunity must undergo review under the Surplus Land Act, or SLA.

The SLA requires a local agency seeking to dispose of real property as surplus to first make it available for affordable housing. In 2019, AB 1486 imposed requirements under the SLA, which included giving the Department of Housing and Community Development, HCD an oversight role and the ability to impose fines when local government is found to have violated the SLA.

Centralizing the Administration of the SLA under HCD and authorizing significant penalties for violations has created confusion and delay, hampering the ability of local agencies to understand their options to effectively conduct activities or fulfill their mission. SB 747 makes a number of changes to the SLA to provide greater clarity for local governments when property is deemed surplus. First and foremost, it provides much needed clarity that the economic opportunity law remains an independent and alternative process for public agencies to dispose of their property.

Second, it makes numerous improvements to the SLA to help local government advance development while avoiding needless delays and uncertainty. When you have uncertainty in how the law is applied, the attorneys take a very, very conservative approach and advise city councils not to take action. So you end up with property that's sitting vacant or unused or deteriorated or dilapidated for a significantly long period of time rather than move and either do housing or economic development.

It allows local agencies to dispose of surplus property for mixed use projects, which contain at least 25% of its units affordable to low income household. The Bill also clarifies that land retained by local governments for several purposes, including broadband development, transit oriented development, land use for airports or ports, tidelands and waste, also qualify for agency use. Property that local government wished to offer for shorter term leases are less characteristic of traditional surplus property.

And that's why we started off with a 35 year short term lease of 35 years or less from the SLA. And as I said, I've taken the Committee recommendations at 15. And finally, SB 747 makes important transparency and accountability reforms to the SLA. It requires a local agency declaration of exempt surplus land is presumed conclusive unless a clear abuse of discretion is established. And as I said, we've gotten rid of that as well.

So the Bill provides do process for local governments by requiring HCD to create an independent appeals process if the department pursues an adverse action against the local agency. Right now, if you're fined by HCD because you're in violation of the SLA, that's the end. There's no appeals process, and we think it's important local government have that right. Local governments have the responsibility to build housing and support economic development within their communities.

Both of the laws, the economic development law and Surplus Land Act, are a critical component to ensure that happens. However, the Legislature has a responsibility to ensure that the laws pass do not inadvertently punish local governments that are genuinely working to advance development, that support the needs of their community. With me today to testify in support and facilitate conversation, I believe it's Aaron Laurel, City Manager of West Sacramento.

But I have to say that there's a little bit of concern that has been raised because of the Committee amendments, and so I'm not sure who's going to be here to testify in support. So I respectfully ask for your aye vote.

Okay. Any support, please come forward. And Senator Caballero. First of all, I want to thank you for working with the Committee and for accepting the amendment. I view this Bill as a work in progress. It's a really big Bill, and I think it is flagging an important issue that there are cities who want to have more flexibility. And this will be a long road, I think, for you, and I think it'll be a real process, which is a good thing.

It's an important issue, and I'm committing to you that we'll continue to work together on this so that you can have a strong Bill that accomplishes your goal and also furthers the state's housing goals.

Thank you for that, Mr. Chair. And if I could, I think there's a little bit of concern. We were looking for data. I think we both agree that what we want is we don't want to let communities off the hook that refuse to build their affordable housing, but we also want to recognize that there are some that are really doing the right thing. And so how do you evaluate between that and I think we tried to strike something in the middle. I'm not sure that it's going to work for a lot of the communities that were in support, but we'll go back, have the conversations and continue our discussions. I appreciate it.

Absolutely. You may proceed.

Thank you, Mr. Chair. And good afternoon, Senators. And I think that conversation sort of characterizes CALED's role in this Bill. We want to be part of that conversation. We were here, obviously, to support the version of SB 747 that we started with. But I think, as you stated very well, it's a conversation that is very important to have to ensure that we have that flexibility around how we apply the SLA. CALED is more than willing to work with the author's office and others to hopefully still get there. And again, my name is Aaron Laurel, City Manager of West Sacramento, which actually was one of the first pro housing designation cities.

But I am here, just to be clear, in representing CALED and our members, we do have concerns about the amendments, mainly because ultimately we don't want to undermine the application of the economic opportunity law, and then more so, we don't want to overly limit the benefits of what SB 747 was intended to accomplish. But we do want to be part of that going forward.

And it's because it's so important for cities to have a very direct role in assembling property for development, not just for housing and affordable housing, but also mixed use development that creates really healthy neighborhoods and communities with retail, office and other amenities to create balance. So, like I said, we're very willing to continue to work on this. And thank you to Senator Caballero for taking this up in the first place. So thank you.

Thank you. Next. Speaker.

Good afternoon, Chair and Members Chris Lee here on behalf of the Urban Counties of California, and today on behalf of the Rural County Representatives of California, we have a support position on the Bill in print. I want to thank the author for her thoughtful and measured attempt at addressing this issue and look forward to the ongoing conversations as well as reviewing the amendments. Thanks.

Thank you, Mr. Chair. Matt Robinson with the California Transit Association. First, just want to thank the author for recognizing a lot of the issues that we've faced in trying to implement the Surplus Lands Act at our particular agencies going back the last few years. It is not a goal that we do not support.

I want to be clear, we are very supportive of affordable housing, but we need to do what's best for not only generating ridership on our systems, but also, as you know, Senator, we are squarely in an operations funding challenge or crisis, I should say. And so we look at value capture around our stations in order to help us generate operating revenue to keep those systems running.

And so it's very important that some of the changes that Senator Caballero was willing to take to her Bill help us be a bit more flexible in implementing the Surplus Lands Act and also make a number of provisions much clearer and acknowledge TOD as an important use for agencies moving forward. And I just want to thank ... for hearing us out last week and having a pretty lengthy conversation with a number of our Members. Thank you.

Thank you, Mr. Chair and Members. Aaron Avery with the California Special Districts Association. Also here today, on behalf of the California Association of Sanitation Agencies and the Association of California Healthcare Districts, we have a support, if amended, position on the April 13 version of this Bill. Obviously, a number of very significant amendments were agreed to today we're going to take a hard look at those, but want to just say thank you to the Committee and thank you to the author for your work on this really important issue. Thanks.

Chair and Members of the Committee, Jordan Panana Carbajal on behalf of California YIMBY we support the concept of the Bill. And we look forward to reviewing the amendments. Thank you.

Thank you. Any additional support in the room? Seeing none. Any opposition?

Good afternoon, Committee Members. My name is Abram Diaz and I'm the Policy Director for the NPH, the Nonprofit Housing Corporation of Northern California. We have an opposed position to the Bill, but we really appreciate the hard work of the Committee to address our concerns.

We also appreciate the author's office and her excellent staff for the willingness to talk with us and talk about the measure, which we agree is very important, as was stated in our letter, which I recognize doesn't reflect the most recent amendments, which we look forward to looking at as well. We're concerned about the creation of an alternative process for surplus land disposition that could undermine the purpose of the SLA.

Over the last few years, as was noted in the Committee analysis, the SLA has helped us build about 6000 affordable units, many of which were unlikely to have moved forward if we didn't have the SLA in its current form. And we know there's also some added exemptions to the SLA as well, and other adjustments and definitions that we think are worthy of a broader stakeholder conversation in the affordable housing world.

Believe that SLA is a very important tool for us and it does not prevent cities from moving forward with their projects. There's a shot clock established, but they are at the end of the day able to move forward with land as needed. But we recognize that there are legal uncertainties and other fixes. I am very much looking forward to having that conversation and appreciate the author's work and her staff's interest in having those conversations as well.

Hopefully we support the author's interest in supporting economic development, believe housing, along with jobs, is important for all our communities, and there are some areas in the Bill that we think could further the interests of our local partners and the affordable houses, ensuring that cities have perhaps an improved ability to address SLA violations and improve notice from HCD amongst their guidelines. So we're looking forward to looking at the amendments and working with the author's office and hopefully we can continue to ensure that SLA is effective. But we also balance the need, of course, to support our economic development and our jobs at the same time. So thank you all so much.

Thank you. Next speaker.

My name is Dante Golden. On behalf of the San Diego Housing Federation, we remain opposed, as is echoing the comments of Abram Diaz with NPH. We remain concerned about exemptions, broad exemptions of SLA. It's been a tool used by my members down south in San Diego. It's built a ton of units around the state. So we look forward to working with the author and coming to an agreement on this, but remain opposed as it is. Thank you.

Any additional opposition or tweeners or anyone else in the room seeing none, we'll go to the phone lines.

Support or opposition of SB 747. Please press one, then zero. We'll be going to line 60. Please go ahead.

David Jones. On behalf of the City of San Marcos, in support of the Bill as originally put in print. Look forward to amending, looking at the amendments and working with the office. Thank you.

Next, we'll be going to line 80. Please go ahead.

Good afternoon, Chair and Members. This is Kirk Blackburn calling in on behalf of the City of Inglewood, in support. Thank you.

Next, we're going to line 81. Please go ahead.

Hi. Good afternoon, Mr. Chair and Members of the Committee. Sharon ... On behalf of the cities of Belmont, Carlsbad, Bakersfield, Corona and Merced, in support of the version of SB 747 in print. Thank you.

There's currently no one else in the queue.

Okay, we'll bring it back to the Committee. Any questions or comments? Senator Umberg?

Thank you, Mr. Chair. Thank you. Senator Caballero, you and I have had extensive conversations about the Surplus Lands Act, either fortunately or unfortunately, the City of Anaheim, the former mayor and many of the former council Members and the Anaheim Angels demonstrated the loopholes and demonstrated a roadmap as to how to get around the Surplus Lands Act without really any sort of a penalty. And I'm pleased to see that you're actively legislating in this area.

And one of the concerns that we had, and I think you shared as well, is the ability to get around the Surplus Lands Act with a lease. And so there's some conversation about what the sweet spot is in terms of leases. Clearly, a 99 year lease is a purchase, a one year lease is not. And I'm grateful for you and I'm grateful for the Chair for engaging in this very important conversation. I'm going to support the Bill, but I know that we'll continue to work on it as it moves through the Legislature. So thank you, Mr. Chair.

Thank you, Senator Blakespear.

Yes, thank you. Thank you to the author for bringing this forward and the chair spoke about the complexity in this area and this being a really ambitious Bill. I know there are multiple different policy goals that we have, economic development, affordable housing, local control, among others.

And I just want to state from my perspective to you as the author, to the Chair, to the Committee consultants, to the public, that a goal that I think we need to give more voice to that is heavily impacted in the Surplus Land Act, is the reality of public property transferring to private ownership.

So even when the Surplus Land Act develops 6000 housing units, when those are only deed restricted, affordable for a term of whatever it is, 30 years, 55 years, 99 years, if it actually, at the end goes into private ownership. To me, that seems like it's not accomplishing the goals that we have here at the state. And I recognize that a number of different agencies that might end up buying this land when it's determined to be, quote, surplus.

It could be public agencies, but they also aren't public agencies. And so earlier in this same Committee hearing, we were talking about public housing and social housing, and we were talking about HCD trying to acquire land and housing and trying to reestablish ownership over housing and land and make it public. And so to me, it seems short sighted to be disposing of property in mass.

So I want to just put that out there as something that I intend to give voice to repeatedly, that we should be setting up systems where public land is not then transferred into private ownership as we are struggling to provide more affordable housing, especially more affordable housing that's actually owned by public agencies. So I will support this today. I recognize it's still in process, but I do have just very deep concerns about more opportunities to have that happen more quickly. Thank you.

Well, you make a really good point, which is different than what the Bill does, which is really different than what SLA was doing in the first place. So I think it's worth continuing just a discussion about it. The challenge, because we are spending a significant amount of resources trying to get back affordability and have covenants that keep it affordable in other contexts for a longer time. Number one.

Number two, that issue that you raise is the issue I've been concerned about with Homekey is that we granted all of these resources, but we haven't ensured that if a motel is purchased or if it's leased, that it stays in public hands forever, that it's deed restricted. And so we probably should have a discussion on that, too, because I think there's some validity to that, and I appreciate you bringing it up.

Senator Seyarto.

Senator Caballero thank you so much for taking this on, because this program has gone on a few years now, and we're seeing the results and some of the unintended consequences that this law has created. And one of the concerns I had, because we've got to understand we're a little different. We don't have an angel stadium. To Senator Umberg's point over there is we have cities in my district that are fairly newer cities, and they don't have an old downtown.

A lot of them are creating their downtown, which means they've created a civic center in which they're going to build higher density around that civic center. And that all depends on a formula for financing and accepting bonds to build city halls and police stations and libraries and senior citizen centers. And when they put those in a civic center, the idea is that you will build jobs and economic opportunity for the people that are able to live around it, and therefore able to walk to these.

The 35 year to 15 year ground lease is an issue for that because built into that economic plan, and I can speak specifically to the one I was involved in, the economic plan was that we would bond for some of the necessary buildings to go in first and then for the ancillary buildings that could include parking structures. A civic center type thing where we have a civic auditorium with offices and other employment generating opportunities could be built via private. So we'd have a public private partnership.

And the public partnership part of it is that we do the ground lease and nobody will build a private, will come in on the private side to be a partner in that. If they have a 15 year lease from which to be able to get their funds back. In other words, there's no return on investment for them in that. So that kind of closes the door on that.

The pro housing designation also concerns me because you could just about put everybody in that category that went through from 2010 to 2016 because nothing was being built, especially out in areas like I represent. Those are the urban rings, those are not, the suburban rings. And there was nothing being built out there because that's the first to come out when you go into a recession and the last to come out of the recession when you come out.

And so there's no applications or there's no builder interest before 2016 or 17. And by the time you get through a process, you're out of that arena category into the next. So it's kind of offensive for those cities to be declared pro housing, not to have that pro housing designation because they didn't build the right amount of housing, because they didn't, and neither did the developers, and they didn't have the interest to do so, and the economy wasn't there for them to do that either.

I have a little consternation when our nonprofits come up and think that somehow the cities are trying to avoid making land that they own available to nonprofits, because not all land that's available for nonprofits that would fall under this would be beneficial to either them or the community. At the end of the day, nonprofit developers are developers. They just make money a different way.

I think it's imperative that they cooperate with cities to be able to build the products in the right place, in the right amount, and be able to help us help the cities get to that number, the numbers that they need, so that they are in compliance. But the other part of that is we got to give them time to get back in compliance because we had a decade where our economy was not good at all.

My housing prices, I remember they didn't recover till 2017, and nothing was being built. Nothing. So we're punishing cities with labels like this, and then we're taking away the mechanisms that they tried to create so that not only would you have entry level housing for people, we'd actually have jobs for them so that they can afford that entry level housing and then to move up. And so that's what I'm looking for in the Bill like yours, is to be able to do that.

And some of the amendments that I'm seeing are kind of taken away from that, especially the ground lease one, because that ground lease is important for cities that are depending on that to be able to increase the economic opportunity that is around those civic centers. I'm absolutely supporting your Bill. I'm reserving the right to vote no if it gets too chopped up.

But we really need to have a good look at this and stop looking at through the lens of the cities are trying to get away with this, and again, putting our thumb on the scale so that everybody else has that advantage, and the cities wind up having their plans for their communities decimated by what we're doing. So super appreciate the Bill. Thank you for letting me have my say.

Thank you. And if I could clarify, is that the amendment on the pro housing, the pro housing designation, are measures that cities pass that show that they're ready to build the affordable housing, those kinds of things. What we stayed away from was the percentage of RHNA numbers that was built for exactly the reason you said - is that I wasn't sure that anybody or very many cities or counties, particular cities built their RHNA number in the last cycle.

It was a terrible cycle, and it doesn't seem to make a lot of sense to me. So we went to something that really shows the interest in the community to do pro housing things, and I believe that's a really good sign that the community is ready and that they should be able to take advantage of this. Just so you know.

Thank you. And I enjoy being a co author. I'm just a little bit getting leery of the amendments that we're getting into.

I understand. We're going to continue to work on it, make that commitment.

Thank you. Senator Seyarto. Do we have any other comments or questions on behalf of our Members in the dais? Seeing none.

Senator, is your mic on?

Oh. Sorry. Here we go. Sorry. So no comments or questions from the dais. Senator Caballero, would you like to close?

Thank you very much for the robust discussion. This is not an easy Bill, and I really appreciate all the comments. Know that Senator Wiener and I will continue to work on this, and I expect it's going to come back different by the time we get out of the Assembly as well, because there's real strong opinions on that. On it as well. So respectfully ask for your aye vote today.

Thank you. Senator Caballero, do we have a motion? Thank you, Senator Cortese. We have a motion by Senator Cortese. Madam Secretary, would you like to call the rule, please.

This is Senate Bill 747 by Senator Caballero. The motion is do pass as amended and rereferred the Committee and Appropriations. [Roll Call]. That's seven to zero.

Seven to zero. We'll leave the roll open for our absent Members. Senator Caballero, what Bill would you like to.

I'll take up file item number nine, SB 17, if that's okay.

Yes. Perfect.

Thank you, Madam Chair. Madam Vice Chair. I'm pleased to present SB 17, which would increase the state's production of affordable housing for older adults. As we have heard over the course of several hearings, older adults are the largest growing population experiencing homelessness for the first time. According to recent reporting by calmatters, in just four years, the state's overall increase in the senior population. Senior homeless population, well, no senior population grew by 7%, but the number of people older than 55 seeking homelessness services increased by 84%.

Older adults are especially vulnerable to circumstances that lead to homelessness. Many live alone on fixed income and have little or no savings, and the slightest unexpected expense is a financial disaster which can force them to make tough choices like paying rent or putting food on the table. While there are many reasons that lead to financial insecurity, the increased cost of living and rising rents can quickly jeopardize an individual's housing security. California's tight housing market further exacerbates the unaffordability.

In order to correct the problem, the state needs to build over 3 million homes, one third of which should be made available to Low income households. However, Low income housing is especially hard to build because it is often not economically feasible without a subsidy, which is why a variety of state and federal funding sources are available to help lower the cost for developers.

A critical funding mechanism for affordable housing construction is the Low income housing tax credit, LIHTC, which creates an incentive for private developers to build Low income housing. LIHTC is administered through the Tax Credit Allocation Committee, TCAC, within the state treasurer's office. Through the program, TCAC sets a variety of goals for the allocation of tax credit, including at least 15% of the credit should be allocated for affordable senior housing projects.

While this does not guarantee 15% of LIHTC credits will be awarded to senior housing projects, it's helped to set a priority. However, if TCAC sets a goal, it should better reflect current need. According to recent census data, just over 20% of Low income renters are seniors. So to ensure tax credits better serve this population, SB 17 requires TCAC to adopt a new senior housing goal of 20%. With me to testify in support is Megan Rose with leading age California.

Hello. We'll now proceed with our lead witnesses in support of SB 17.

Good evening. My name is Megan Rose. I'm here with leading age California. Thank you so much, Senator, for your leadership in helping to address the crisis of older adult homelessness. Leading age California is a membership Association representing nonprofit providers of housing, care and services across the out of hospital aging continuum. And as the Senator so eloquently stated, homelessness among our older adults is on the rise.

Half of our homelessness population is age 50 and over, and of that population, half of them didn't become unhoused until after age 50. And this is a growing problem because our housing costs have increased so much in proportion to our fixed incomes. So, as we know, many older adults live on fixed incomes. The maximum SSI benefit for a single individual living independently in California is one $100 meanwhile, the fair market rent for a studio apartment in California is one. $400.

So it literally makes it impossible for many older adults to live independently without affordable housing. Our affordable housing providers report that they're seeing waitlists five to seven years long in many cases. So if you're an older adult waiting for affordable housing in California, that can literally be a death sentence. A lot of older adults dying waiting to get into affordable housing.

We are very supportive and proud sponsors of SB 17 because we are just hoping to kind of move the needle in our housing policy to help address the needs of older adults and really align our housing policy with the needs of our growing older adult population. By 2040, California will have 623,000 new renter households that are older adults, all older adults. 72% of those are households of color. And so we really need to adjust our housing policy to meet the demands of this growing population.

For older adults, housing is health care, and so if we cannot house them, it makes it very difficult for them to bridge into the long term care continuum that we have in California. And so with that, we respectfully request your aye vote. Thank you so much.

Thank you so much for your testimony. Do we have any other lead witnesses in support of SB 17? C now will now continue to. Witnesses here in room 2200 in support of SB 17, seeing none. Will now move on to witnesses in opposition for SB 17 here in room, or lead lead witnesses first for SB 17 here in room 2200, seeing none. We'll now move on to General witnesses in opposition to SB 17 hearing room 2200, seeing none.

We'll now move on to witnesses in support and opposition for SB 17 via the teleconference service. Mr. Moderator, if you would please queue up any witnesses in support in opposition to SB 17. We'll bring it back to our Committee Members. Do we have any comments or questions from the dais? See none. Senator Caballero, would you like to close?

Respectfully ask for your aye vote today.

Thank you. Senator Caballer0, do we have a motion for SB 17? Thank you, Senator Seyarto, for the motion. We do have a motion by Senator Seyarto. Madam Secretary, would you call the roll, please? [Roll Call]

We'll leave the roll open for our absent Members. I have to close out for human services, so. Senator Umberg, would you like to. Looks like he's leaving tomorrow.

What a surprise. Item number 10, Senator Caballero, SB-

657.

657.

Thank you very much. Thank you, Senator and Members of the Committee for the opportunity to present SB 657 in Committee today. SB 657 will enhance gerontological or age-related training for homeless service workers to better prepare them to assist older adults experiencing homelessness. The high cost of housing and the lack of retirement assets has created a crisis among the senior population in California. Older adults on Social Security with a fixed income that only increases nominally experience difficult paying their rent as California rents soar.

As you heard before, Social Security benefits increased 5.9% last year, which is an average of $93 increase per month for retired seniors. And although it was the largest increase in four decades, it was not enough to sustain most rent increases. Approximately 40% of older Americans rely solely on their Social Security income to get by and that averages about one $1,600 a month.

As California's population continues to age and the scarcity of affordable housing suggests the number of older adults who are homeless or in danger of homelessness will increase--and that's a serious issue--homeless shelter and prevention services staff are an important component of the success of addressing California's homeless crisis. However, the majority of the support staff are not trained in the issues and concerns of older adults.

What I can say about that is that one of the things I learned in taking care of my parents as they aged was that there are circumstances that lead to a rapid decline in mental capacity; and that's being isolated from a stimulating environment, having hearing problems that can be embarrassing, but also keep you from hearing clearly what's going on and you tune out when people are talking to you, the inability to get physical exercise--all of that really speeds up mental decline significantly.

And so the challenge is is if you don't understand that as a service provider, if you're not looking for the kinds of things that can be telltale signs of isolation and the beginning of mental decline, then you don't know how to handle the situation. In San Diego County, the Area Agency on Aging has created a training entitled Aging 101 in collaboration with the regional COC and has begun training homeless service staff to learn about the growing senior population, more of which are living in poverty and facing increased risk of homelessness. The training aims to improve knowledge related to seniors' needs and ability to perform activities of daily living such as bathing, dressing, grooming, eating and mobility.

Age appropriate training also provides tools to identify the older adults' level of dependency to help connect them to the services and resources in the community that is appropriate for each individual. Understanding the basics can allow staff to effectively plan care for the seniors that they're seeing. This cooperative partnership meets the mandate of the California Interagency Council on Homelessness, which was created by the Governor and existing funding available to local and regional efforts to reduce homelessness.

SB 657 would require the Interagency Council to coordinate with the California continuums of care and the Area Agencies on Aging to partner in their shared regions to provide gerontological training for homelessness service staff to ensure that all service providers are well-trained and well-equipped to assist vulnerable older adults to access resources, services and a pathway to gain permanent housing solutions. Unfortunately, due to the last minute changes, our witness is not going to be able to testify in person. So respectfully ask for your aye vote.

Thank you very much. Those in the Committee hearing room in support of SB 657, please approach the microphone. Seeing no one. Oh, here we go.

Leading Into California in support of this bill. Thank you.

Any additional support testimony? Okay, any opposition? Seeing none, we'll go to the phone lines.

Ladies and gentlemen, if you wish to make a comment in support or opposition of SB 657, please press one, then zero. We'll be going to line 75. Please go ahead.

Chair and Members, Sylvia Solis Shaw here on behalf of the City and County of San Francisco in support of the bill. Thank you.

And there's currently no one else in the queue, Mr. Chair.

Sorry. We'll bring this back to the Committee. Any questions or comments, colleagues? Okay. Sorry, one second. Okay, you may close.

I respectfully ask for your aye vote.

Thank you very much. I'm sorry, did we have--we need a motion. Motion by Senator Umberg, and that is to pass to the Committee on Appropriations, and we will call the roll.

Wiener. Aye. Ochoa Bogh. Blakespear. Aye. Caballero. Aye. Cortese. McGuire. Padilla. Aye. Seyarto. Aye. Skinner. Umberg. Aye. Wahab. 6-0.

Okay, six votes. We'll put it on call. We're going to our last item. I'm going to put a call out on the television for staffers to please get your Members to Housing Committee so we can open the roll. So if Members could please come. And the last item by Senator Caballero in our Caballero fest, going to channel Senator McGuire.

Bring it home.

Item 11. SB 684, you may present.

Thank you very much, Mr. Chair. I'm pleased to present SB 684, which creates a streamlined process for communities to build small scale homeownership projects. Since 2010, California's population growth has far exceeded the number of new homes built. The lack of new housing construction has been a key factor in the state's affordability crisis because supply simply has not kept pace with demand. The lack of supply and affordability has also continued to drive down California's homeownership rates and drive up rental costs.

In fact, the affordability crisis has become so extreme that homes now cost more than 8.5 times the average family salary. As a result, the American dream of homeownership is now out of reach for many California families, especially families of color. Just like housing, affordability has driven homeownership rates down for communities of color. Local planning rules have also created barriers to ownership.

Many communities throughout the state have enacted policies that restrict denser development in single family neighborhoods, which prevents the construction of small starter homes working families can afford under existing law. The framework for dividing land for sale, lease or financing is set forth under the subdivision map app. Mac, or MMSA, which has been on the book since the mid 1970s. The SMA creates an extensive permitting and approval process that often delays the permitting and construction phases of the new homes.

While the SMA is an important tool for both local agencies and developers, there are opportunities to streamline the process to help allow construction to begin at an earlier stage. SB 684 expands the tools available to local governments and developers to streamline small lot subdivisions for the construction of homeownership projects to create more lower cost homes. Specifically, it will shorten the time frame for development by authorizing local agencies to issue building permits once a tentative map has been recorded and provides for ministerial buy right approval.

SB 684 also includes important guardrails to ensure neighborhood characteristics are preserved, such as requiring developers to abide by existing setbacks and height requirements and include any affordability provisions required at the local level. Additionally, any proposed development cannot be greater than 10 units on parcels five acres or less and located on parcels either zoned for multifamily or vacant parcel zoned for single family residential development.

With me today to testify in support is Sosin Maddenat on behalf of California YIMBY and Eric Payne, Executive Director of the Central Valley Urban Institute.

Thank you very much. You may proceed.

Committee Sosin Maddenat, w strategies here on behalf of California YIMBY as proud sponsors of this legislation. YIMBY is a statewide organization of over 80,000 neighbors dedicated to making our state an affordable place to live, work, and raise a family for all Californians. While there's no singular reason for California's housing crisis, the LAO has identified the undersupply of housing as one of the biggest culprits.

It has contributed to California's high housing costs, and we have the third highest median home price and the second lowest home ownership rate in the nation. This was made painfully clear recently when we saw the California Dream for all programs, 288,000,000 in homeownership funding fully extinguished within only 11 days. So obviously there is a need for support to increase home ownership for Californians in the state.

The low ownership numbers are particularly concerning when we consider that homeownership is one of the most important generational wealth-building tools for our families, and those hardest hit by the affordability crisis are people of color. A practical tool to address this problem is by removing barriers to the construction of missing middle housing, which this Bill will do. This refers to a range of multi-unit or clustered housing types compatible in scale with single-family homes in the neighborhood, such as duplexes, fourplexes, cottage quartz, and townhomes.

The creation of this housing can have a positive impact on the availability of more affordable starter homes that allow new buyers to enter the otherwise competitive housing market. However, barriers such as the lack of clarity within the Subdivision Map Act prevent small-scale developers from building these housing options. SB 684 encourages the creation of dismissing middle housing by streamlining the SMA, allowing small projects of 10 units or less to move forward sooner in the process, saving critical time in the development timeline.

While there's no silver bullet to solving the crisis, there are important steps that we can take to encourage housing production, and SB 684 does just that. It's for these reasons we respectfully ask for your aye vote thank you.

Thank you. Next speaker.

Good evening. Chair and Members of the Committee, my name is Eric Payne. My pronouns are he him, Executive Director of the Central Valley Urban Institute, a nonprofit based in the heart of the San Joaquin Valley, serving as a policy advocacy, research and action Institute, advancing racial and economic justice by empowering and educating our most vulnerable residents, who are often on the margins of the decision making process.

We are working to close the racial wealth gap, focusing on housing and home ownership as an organization led by and serving people of color. I'm here today as a proud co sponsor of SB 684. California faces a housing affordability crisis that has slammed the door shut on home ownership for millions. This essential legislation will produce more homes that are lower cost and more accessible to first time home buyers by enabling production of single family homes or townhomes on lots that are smaller and less expensive.

California's median lot size is 8300. Research has found that land costs make up more than half the price of a home in places like Los Angeles, San Diego, Salinas, San Jose, and San Francisco. The math driving SB 684 is simple. A home that comes with less land will cost less. Many families want and can afford a large home with a large backyard. These families have plenty of options in today's market, but too many can't buy a home at all because affordable options don't exist.

Many families, and I would argue many more families of color, would love to buy a home with less land if that made the American dream of home ownership possible for them. SB 684 does just that, making these types of homes much more common, creating increased choice for diverse families.

My organization is deeply invested in this topic because while home ownership is the way in which most Americans build intergenerational wealth, only four in 10 Black and Latino Californians own their own home, compared to six in 10 white Californians. That's one of the main reasons why, for every dollar of wealth held by a white family, Black and Latino families have about 16 cents. And I know we can do better. Homeownership is broadly a shared value in California.

SB 684 represents one important step in creating the important technical step needed to actually produce lower-cost, for-sale housing and making that shared value a reality. These are no silver bullets when it comes to addressing Californian's housing and home ownership crisis. But SB 684 creates an important tool for building affordable homes and building wealth for every Californian. Thank you for your consideration of this important measure, and I respectfully request your. aye vote. Thank you.

Thank you. Any additional support, please come forward.

Good evening, Mr. Chair and Members. Graciela Castillo-Krings, here on behalf of All Home in support.

Good evening. Chair and Members Cornelius Burke with the California Building Industry Association in support of the Bill, home ownership matters. Thank you so much, Senator, for your leadership.

Good evening. Brian Sapp, on behalf of Habitat for Humanity in support. Thank you.

Chair, Members of the Committee Jonah Carbajal, on behalf of Bay Area Council in support. Thank you.

Thank you. Any additional support in the hearing room? Seeing none, we'll move to opposition. Is there any opposition? Seeing none, we'll move to the phone lines.

Ladies and gentlemen, if you wish to make a comment in support or opposition, please press 1 and 0. We'll be going to line 78. Please go ahead.

Good evening. My name is Eduardo Rubalcava. I am a resident of Sacramento and a volunteer for AARP Senate Bill 684 is a tier one Bill for AARP, which means that AARP, on behalf of its 3.3 million Members in California, strongly support this Bill, and we urge the Committee to support it and pass it. Thank you.

There are currently none other in the queue.

Okay, we'll bring it back to the Committee. Colleagues, any questions or comments on SB 684? Okay, sign. Do I have a motion? Okay, and that is a motion to pass to the Appropriations Committee, correct? Appropriations, no. Okay, we have a motion by Senator Caballero, and you may close.

Thank you very much for the opportunity to present this Bill. This is really a very modest but important to respectfully ask for your aye vote.

Okay, we have a motion on SB 684 to pass to appropriations, and we'll call the roll.

[Roll Call] Seven to zero.

Okay, we'll put that on call. We've now completed the presentations before we open rolls. Just 1 second please. We're going to just go through everything now so folks can leave. We're waiting for a couple more Members, so we'll just start on the consent agenda. That's file items 126 and 8. Please call the absent Members.

[Roll Call]

Okay, we'll put that back on call. We'll now go to item number three, SB 352. Please call the absent Members. Senator Caballero 352. Item three.

[Roll Call]

Okay, that Bill is back on call. We'll now go to item number four. SB 713. Please call the absent Members.

[Roll Call]

We'll put that back on call. Next is item seven, SB five. Five.

[Roll Call]

Put that back on call. Next is item number nine. By SB 17, please call the absent Members.

[Roll Call]

Okay, we'll put that back on call. We'll now go to item 10. SB six was the final vote.

11 to zero.

Okay. That Bill is Alps. That's item 10. Okay, item 11, SB 684. Please call the absent Members.

[Roll Call]

Um. Okay, that Bill is out. Item number 12, SB 747. Please call the absent Members.

[Roll Call]

Okay. SB 747 is out. Okay, we're now going to go back to the top. I think everyone's here now who hasn't voted. Item number one, please call the absent Members. Item number one, SB eight. I'm sorry. The consent agenda. Please call the absent Members.

[Roll Call]

Okay, the consent agenda is approved. Item number three, SB 352. Please call the absent Members.

Senator. Mcguire. Mcguire I Skinner. Aye. Skinner I that's 10 to 110 to.

One that Bill is out. Next is item four, SB 713. Please call the absent Members.

[Roll Call]

Okay. Nine to zero, that Bill is out. We'll next go to item five, SB 405. Please call the absent Members.

[Roll Call]

Item, which four?

[Roll Call]

SB 405 is out. And then item. Item seven. SB 55. Please call the absent Members.

Ocho. Bogue. Mcguire. Mcguire I Skinner. Aye. Skinner I that's nine to one.

Nine to one, that Bill is out. And then next is item nine, SB 17. Please call the absent Members.

[Roll Call]

11 to 00:11 to zero, that Bill is out. And I believe 101112 are closed. So we've now handled everything. Okay, great. I want to thank everyone for today. We've completed all of our business, and the Senate Committee on Housing is adjourned.