Assembly Standing Committee on Housing and Community Development

Well, good morning, everybody. I want to welcome you to the April 17 hearing of the Assembly Housing Community Development Committee. We have 22 items on our agenda today. For the record, AB 2314 that is, item number six has been pulled by the author. We have seven doles on consent.

Item number four, AB 2117 item number nine, AB 2638 item number 102663 item number 12, AB 2694 item number 13, AB 2835 item number 15, AB 2898 and item number 21, AB 3122. When we've established a quorum, we'll be able to take a vote and a motion and a vote on the consent look calendar. Each Bill can have two main witnesses in support and opposition, and each main witness gets two minutes each.

I welcome you to submit written testimony through the position portal on the Committee's website. It'll become part of the official record for the hearing. Our hearing room today will be open for attendance, and all are encouraged, of course, to watch the hearing from its live stream on the Assembly's website. I want to thank you for your patience and understanding. We have a busy agenda this morning, but I think a lot of productive conversation to get through.

And with that, we are going to begin as a Subcommitee and encourage all Committee Members to make their way to room 126. In the meantime, I see our first author was here before me. Thank you, Doctor Arambala. When you're ready, you can present item number one, EB 1840. And we welcome your witnesses as well.

Good morning, Mr. Chair and Members. The social and economic benefits of home ownership should be available regardless of immigration status. AB 1840 ensures that eligibility for the California Dream For All Program includes undocumented persons. Undocumented individuals have historically been excluded from housing initiatives because of federal restrictions. At the state level, legal status can complicate access to home loans and homeownership assistance programs, posing a significant hardship in an already challenging sector of California's economy.

Ensuring universal access by all qualified borrowers to the California Dream For All Program will contribute to the overall success and vitality of California. Testifying in support is Cynthia Gómez, Deputy Director of CHIRLA, the state policy and advocacy--excuse me--Deputy Director of State Policy and Advocacy at CHIRLA, Cynthia Gómez.

Welcome.

Good morning, Mr. Chair and Members. My name is Cynthia Gómez, Deputy Director of State Policy and Advocacy for the Coalition of Humane Immigrant Rights, CHIRLA. CHIRLA is proud to sponsor AB 1840 and are thankful to the leadership of Assembly Member Arambula on this bill. Like we're all familiar, homeownership is one of the largest contributors to building wealth for low and middle-income families.

A report by the United States Department of Housing and Urban Development found that annually, housing and wealth accumulation due to the appreciation of homes ranges from 1,712 dollars to upwards of 4,460 dollars. However, it's also well-understood that there are many barriers to access for homeownership, in particular for communities of color. California is solution-orientated, and we have implemented various policies that have made homeownership a reality for Californians.

Among that has been the establishment of the Dream For All Program, which helps first-time homebuyers provide a down payment on a home. The Dream For All Program is a monumental program that benefits many low and middle-income families. However, we need to ensure that all Californians have access to the program and this is precisely what AB 1840 seeks to achieve. AB 1840 will ensure that an individual is not turned away from the Dream For All Program solely based on their immigration status.

California is home to approximately ten million undocumented immigrants who live, work, and raise their families within our state, and immigrants are an integral part of what makes California the Golden State. Economically, immigrants are also a large contributor to our state, contributing roughly 37.7 billion dollars in state and local taxes. In recent years, California has made great strides in ensuring that we live up to our ideals and embody the notion of being a California for all.

AB 1840 continues our commitment to ensuring that all Californians, irregardless of their immigration status, have access to the programs that they need to thrive. We thank you for your consideration on this bill and appreciate your support on AB 1840.

Good morning. My name is Leticia Lopez, Central Valley Organizer with CHIRLA, sharing testimony from Karen Zapera, CHIRLA member from Lindsay. 'Thanks to the Dream For All Program, I was able to achieve my longtime goal of buying a home as a DACA recipient. If one person in the community succeeds, that pushes the community forward, and I am fortunate to be able to inspire others to be unafraid of taking risks and opportunities. I'm a huge advocate when it comes to pushing forward the community.'

'Unfortunately, for my parents and many members in my predominantly Hispanic immigrant community, this is something they can only dream of. In the Central Valley, farmworkers make up a great portion of the workforce. This leads me to the question: is California truly upholding equity if the individuals who carry our strong, agriculturally dominated economy are staying behind? Many of these individuals who work hard day-in and day-out pay rent, pay taxes, and give so much to their communities.'

'We are speaking about individuals who have put in blood, sweat, and tears over the course of 20, 30, 40 years and aspire to own a home. Being able to fulfill this longtime dream of providing a home for their families and excel is something many members of my community can only dream of.'

'Extending the opportunity to undocumented people would allow more community members housing security, not having to worry about homelessness, and after an immense physical toll day-in and day-out in hard labor jobs, the opportunity to improve their livelihoods. I ask you, please support AB 1840 and thank you for your time.'

Thank you. Are there any members of the public here in support of this item?

Yes.

Name, organization, and position. I'm sorry. I'm sorry. I did not complete the instructions. Please approach the microphone and state your name, organization, and position.

Good morning, Chair and Members of the Committee. Sosan Madanat, W Strategies, here on behalf of UnidosUS, in strong support.

Thank you.

Alicia Benavidez, here on behalf of ACLU California Action.

In support. Mark Stivers with the California Housing Partnership, in support.

I'll go ahead and say it in Spanish. [Testimony in Spanish].

Thank you.

I'm Joanna Lopez from CHIRLA, and I support AB 1840.

Thank you.

Buenos Dias. [Testimony in Spanish].

Buenos Dias a todos. Mi nombre es Monica Sanchez. [Testimony in Spanish].

[Testimony in Spanish].

[Testimony in Spanish].

My name is Cezanne Camacho, and I support AB 1840.

Mi nombre es Philippe Martinez. [Testimony in Spanish].

Thank you.

[Testimony in Spanish].

Thank you.

Buenos Dias. Mi nombre es Martina Costa. [Testimony in Spanish].

Thank you. At this time, we're going to pause and ask our Committee Secretary to establish quorum.

[Roll Call].

Thank you. We have a quorum. We'll continue on this item, and are there any primary witnesses in opposition? Seeing none, any members of the public wishing to state opposition on the record? Okay. Seeing none, we'll bring this back to Committee. Any Member comment? Ms. Reyes moves the bill. Vice Chair Patterson.

Thank you, Dr. Arambula. As I kind of alluded to last week on another bill is, you know, my stepdad, who's been in my life since I was six months old, is a Mexican immigrant, and all my brothers, older brother and three younger brothers are Latinos. And as a result of that, being from Napa, you know, we have a lot of family members, you know, that came here from Mexico. We have people on work visas, you know, living in this country and things like that.

So I'm very sympathetic towards the plight of immigrants. I welcome immigration to this country, and I agree that the Mexican population in particular, immigrant population in general depending on where you're at in California provides a lot of labor for, you know, for our farms and things like that. So I'm sympathetic towards opening up opportunities for the immigrant population for sure.

Last Friday, I happened to visit the border in San Diego and met with the California Border Patrol, where I was informed that 1,200 people per day are crossing the border undocumented seeking asylum in the United States, the vast majority of them not actually Mexican. They're from other countries coming through the California Border for a combination of reasons.

And what happens is--and I'm sure you know all this; I'm just kind of putting this on the record--is right now under the current administration and the current practices is if they get across the first fence, which is 18 feet in San Diego, or however else you come across, they are processed and released and given five to seven years, depending on where they go. If they go to Iowa, it'll be five months.

If they go to New York or say they're going to New York, it'll be five to seven years before they get their court hearing. And with limited funds that we have in California, I just, I cannot get behind. And by the way, I understand in a lot of cases the DACA situation where we have people who came with their parents when they're children, right, and that's--some of my friends on city councils and things like that came here and were DACA, came here, DACA recipients.

But I just can't get behind using our limited dollars for people who continue, who are in this country undocumented when we have very limited funds. We have a lot of people suffering in this state, and I think we have to make decisions, and there's, where do we make those decisions? Where do we draw that line? And so because of that, I can't support this legislation.

I know that this is something very important to you, and I say it with a lot of respect to you as the author and the people advocating for this, but I just can't support giving limited funds to people who aren't here legally. I understand the complicated process of getting here legally, trust me, and 17 years to get a visa for my stepfather's family members, but long way to say, I just absolutely am very against this bill, but I have a lot of respect for you, so thank you.

Thank you, and through the Chair, if I may, I don't want to conflate the larger immigration issue with the proposal that we have before us. We were very intentional to make sure that it was an immigrant who would be able to qualify for a loan. To do such, they would have either an ITIN or a Social Security Number, which would elevate the bar much higher than you were referencing, Vice Chair.

Second, I'll just say, oftentimes it is our immigrant communities who are taxed who don't have representation and don't get the resources that they need to build the generational wealth that helps the American citizens that they're having here in our state right now. And so there's a tremendous benefit from us as a system to recognizing that all people in our state should have that opportunity to dream that they are homeowners. Nice entrance.

Thank you, Dr. Arambula. Any other Member questions or comments? Ms. Reyes.

I do want to thank you for bringing this bill. I think that you have--and thank you for clarifying that we are talking about something completely different. The applicants have to qualify. It isn't given out willy-nilly to just anybody. So I appreciate that and I appreciate all the effort you put to put into guardrails. We don't want somebody to also buy a house and then lose it because they should not have qualified in the first place. We already know that happened a lot with a whole lot of people who bought their homes. So thank you again for bringing this bill forward.

Thank you. Seeing no other Members wishing to comment, we have a second by Mr. Grayson. Dr. Arambula, I want to thank you for bringing this bill forward. I think it's important that we are supporting all Californians who are here, and importantly, and I wanted to double-check, are you accepting the Committee's clarifying amendments?

Yes, sir.

Thank you, because that would be very important to make sure that the program can be sold in service by Fannie Mae. With that, would you have anything further to close?

Thank you for the opportunity to present. I respectfully ask for an aye vote.

Thank you. Madam Secretary, call the roll.

Motion is 'do pass as amended to the Assembly Committee on Appropriations.' [Roll Call].

That bill currently has five votes. Five votes; it is out. We'll hold the roll open for absent Members. Thank you.

Thank you.

Next, we have here, Mr. Assembly Member Juan Carrillo, and so we'll take Item Number 2485, and when you are ready with your presentation, you may begin.

Thank you Mr. Chair and Members. I thank you for allowing me to present Assembly Bill 2485. This bill seeks to enhance transparency in the Department of Housing and Community Development, known as HCD. Regional housing needs calculating process by creating an advisory panel and recording the publication of methodologies used on HCD's website. The Regional Housing Needs Assessment, or RHNA as is referred to, is a state mandated program that requires cities and counties to build new housing for expected population growth over an eight year planning period, the planning cycle as it's called.

Communities use RHNA in their land use planning, prioritization, local resources allocation, and deciding how to address identified housing needs resulting from population, employment, and household growth. While it does not necessarily encourage or promote growth, it allows communities to anticipate it so that collectively, the region and the subregion can grow in ways that enhance quality of life, improve access to jobs, promote transportation, mobility, and address social equity and fair share housing needs.

In March of 2022, the State Auditor conducted an emergency audit to examine the RHNA process and identified several errors in HCD's housing projections that resulted in a decrease in the allocated housing amounts. Specifically, Sacramento COG fell short by 2,484 housing units and Santa Barbara COG by 1,338 units. Additionally, the State Auditor found that HCD could not demonstrate that it had adequately considered all the factors as required by state law.

In response, the State Auditor stated that shortcomings in calculations and support for HCD's factors, considerations, risks eroding public confidence in their ability to provide accurate information to COGs concerning housing needs. The State Auditor recommended a formal review process and through documentation measures to ensure that all RHNA calculations provided to COGs are accurate. To assist in this formal review process, the advisory panel would include a United States Census Bureau affiliated practitioner, an expert on data related to RHNA, and representative from the COGs.

AB 2485 aims to address these concerns from the State Auditor's office. The additional steps in the RHNA determination process will be seamlessly implemented within the current calculation timeline and will not delay the distribution of housing needs to COGs and their cities or counties. Additionally, I am committed to working closely with HCD and regional cogs to determine reasonable data within the current cycle timeline to perform these new steps.

Given the importance of RHNA process in alleviating the state's housing crisis, its visibility as it affects neighborhoods, and the sheer magnitude of housing need compared to what has been built in the past, there is a severe risk to the credibility of the process if it is insufficiently transparent, credible, and robust.

Second. There's a motion and a second. Is there a witness in support that would like to testify?

We do have a primary witness, the Vice Chair of SCAG Legislative Committee from Riverside, Mayor Patricia Lock Dawson.

Fantastic. You're welcome to just offer a support statement or any other information you'd like to.

I have a very long statement.

Please use the microphone for those listening on the TV.

And also Lynwood mayor, Jose Luis Solache.

Thank you. You'd have up to two minutes each.

So good morning, all. My name is Patricia Lock Dawson. I'm the Mayor of the City of Riverside, and I'm also the current chair of the Southern California Association of Government's Legislative Committee. And I want to thank you for hearing us today, today to discuss this bill. The purpose of the bill is not to lower or increase RHNA determination, but to ensure its accuracy. And I think we're all interested in that.

In 2022, State Auditor conducted a report and found that some of the RHNA determinations made by HCD were inaccurate. Shocking. Additionally, in the SCAG region, with our 1.34 million RHNA determination, many of our member cities and counties expressed frustration with the lack of transparency surrounding the process. So our bill seeks to address these concerns by, one, creating simple procedures for HCD to publicize its data before finalizing a region's RHNA determination, and two, convening a panel of experts to advise the Department on that data.

And that panel would be split specific to each council of governments comprised of three entities, including a Census Bureau-affiliated practitioner, a demographic expert, and a COG representative. Currently, the determination process includes a consultation requirement between COGs and HCD, but it's ill-defined in state law. This bill seeks to both maintain the flexibility which we appreciate, and enhance the consultation process by having a neutral third party with demographic expertise provide peer review to ensure the numbers, assumptions and equations are vetted and fact-checked.

So I will stop there. And we envision the process laid out by our bill being integrated into existing consultation timeline. And we hope that by increasing trust in the process through added transparency, there will be fewer appeals and delays, which we had a lot of last year. So thank you for the opportunity. I would like to hand it over to my colleague, Mayor José Luis Solache, who's the Vice Chair of the Committee.

Thank you. Thank you, Mayor, and thank you, Committee Members. Again, José Luis Solache. Proud to be here today, just to be an advocate for our housing needs in California, Southern California. Just to reiterate, we represent six counties in the Southern California region, and we're committed to building 66,000 new housing units throughout Southern California. I think the mayor already eloquently stated a lot of the facts that we wanted to share. So we want to be respectful of time.

But also additionally, we are strong advocates for housing programs that help our cities and counties support housing development in climate friendly way, such as Infill Infrastructure Grant Program and Affordable Housing and Sustainable Communities Program. But we would love to get your support on this. Thank you, Senator Carrillo, for helping us push this build together for our communities. And we're looking forward to be a partner with our state leaders in creating more housing for our families of Southern California.

Thank you very much. Are there any members of the public here in support of this item? Please approach the microphone.

Good morning, Committee Members. Sabrina Bradbury with the California Association of Councils of Governments, in support.

Thank you. Mark Neuburger with the California State Association of Counties, in support.

Good morning Chair, Members. Brady Guertin, on behalf of the League of California Cities, in support.

Good morning Chair and Members. Carlin Shelby, on behalf of the San Gabriel Valley Council of Governments, in support.

Thank you. And are there anyone here in primary opposition to this bill for testimony? Seeing none, any members of the public wishing to state opposition on the record and seeing none, we'll turn it back to the Members for questions. Assemblymember Quirk-Silva.

Yes, I have a few questions. This bill doesn't have any intent to transfer any housing allocation.

That is correct. There is no intent.

City to city? No, because we know that there has been some attempts to do that, which I'm highly opposed to. When we talk about a third party impartial member on part of this board. I believe you mentioned in your comments that it would be, who would that third party be? Can you restate that?

Sure, I can. And in my comments I have here. But I would also defer to the author. But the way we had it written in there was that it would have three entities, US Census Bureau-affiliated practitioner, demographic expert, and a COG representative.

Who is an affiliated practitioner? What would that look like?

I don't know if we have really specified who the practitioner would be, but we talked about results from the census data that is part of it. So it could be somebody from the Finance Department who are in charge of the census process.

I'm going to support the bill today, but I do have concerns that this would not delay the implementation or the process, as we've already seen many, many attempts by local municipalities to delay, to prolong and not to meet what the spirit of the arena numbers. And this is, in fact, why we are in the position we are because we're not building at the pace we need to.

And many-- you said there's been many appeals, and that is certainly a jurisdiction's right, but as we know what it does, it adds years to projects, and then projects ultimately don't get built. So I get a little concerned when I see the support here, which is usually the support individuals or organizations who oppose housing. So I'm just going to be as blunt as I can.

I will support it under the guise that we want to do a much better job of having local municipalities accept the RHNA numbers and move forward in a streamlined pro-housing format to get the housing that we know we desperately need in California.

Thank you for that. But if I can elaborate on that on. I believe that this will actually accelerate the process on cities accepting the allocations. And I say that because I participated in the HCD process on the 8th cycle, and a lot of those two or three appeals had to do because they questioned the methodology on how these numbers came about.

So by having that transparency and that communication with HCD as to who are the methods really is, I do believe that it will actually lessen the number of appeals based on my experience on the 8th cycle.

Well, Assemblymember Carrillo, you are well-respected, and that is why I will be a yes on this. But I can tell you that I have heard directly from my cities, they don't believe in the RHNA process. They think they're inaccurate, and they're going to do everything they can to fight it. But because you are the lead author on this, I will support it. Thank you.

Thank you Ms. Quirk-Silva. Vice Chair.

Great. Thank you. I agreed with some of the sentiments from my colleague here on the Committee that we are seeing just not really good faith efforts from some jurisdictions. But I just want to say, just with all due respect, is that I do believe RHNA numbers are fiction and imaginary. My city was one of the fastest growing cities. Approved every project in the six years that I was on there.

And the new RHNA numbers, despite it being completely built out, are double than what they were before. Now, we went through the process, found all the sites. We did it. But that amount of housing just isn't going to come to the city because we approved everything and we only got half the number they're asking for. And I think until we sort of, you know, recognizing that as an institution, then cities are going to continue to struggle.

I'd rather we put a lot more time and effort on actually delivering housing. But I think that this is a good, because this adds that component in terms of somebody who's kind of like disinterested and they're talking about the demographic changes where people are moving to and the likeliness of potential success that we could meet those numbers.

And so I just think it brings an element to the-- it brings a little bit more of a realistic, and I will say I also looked at the supporters as well. We're not often on the same page as we saw in Committee last week. So I get that. But also this brings a little bit more of a dose of reality to the process. And I think a good bill. And actually I'd like to be added as a co-author if you would do that when the time comes.

Absolutely. Thank you.

Thank you, Vice Chair and seeing no-- Ms. Reyes?

Well, I appreciate the witnesses you brought. It's always good to have some local people come in and talk about the need for something like this. But I've got to tell you that a lot of the comments from my colleague from Orange County, this is important to keep this in mind. And then when my colleague says these are made up numbers, then I know we have problems because they have to be real numbers.

And we really, so if what we're counting is not being counted properly, then we do need to figure out a way. Our colleague has mentioned you have a great reputation. This is something that you've spent your career in on planning. And so this is important, and I know it's important to you. And my colleague said our job is to deliver housing, or our city's job is to deliver the housing. You talked about transparency. Those are all the right things to say.

But the RHNA numbers are real and we do have to increase our housing. We need to meet our goals. And if there's some better way to do it, I'm willing to look at something different. But we do have to meet those goals. Thank you.

Thank you. Mr. Kalra? Nope. Fantastic. Mr. Carrillo, I want to thank you for bringing this bill forward. I'd argue that these are not made up numbers. There's something going into the formula that is trying to inform what we need to plan for.

And I think the transparency piece that you're trying to tease out here is important, important for everybody, to your witnesses support point, and yours as well, that we are understanding what's going into that it's going to reduce a lot of the tension and debate and potential lawsuit and delay on the back end. But I think that the conversation, if we're not meeting our RHNA numbers, it's because we're not producing the housing that we need.

And if we're not producing that housing, we're going to have real challenges with our population and with our society as a state, I think, in the coming time. But let's start, you know, back at the beginning and make sure that we're doing this in a very transparent way. I'd encourage you to work with HCD to make sure that the advisory body, as you are describing it, implements correctly.

And by that, I mean that is something that is designed in a way that meets the interests of both our local partners, as well as your interest as an author. With that, I invite you to close.

Well, thank you for that. And you all have my commitment that I'll continue to work with HCD. And with that, I ask for an aye vote. Thank you.

Thank you. Madam Secretary, please call the roll.

Motion is due pass to the Assembly Committee on Local Government. [Roll call]

That measure has seven votes. It will be out. We'll hold the roll open for absent Members. Thank you.

Thank you.

Thank you very much.

Next, Assembly Member Alvarez is here, and I think we have one item. This is Item Number Seven: AB 2430. Welcome back, and if you have witnesses in support, they may join you at the presentation table as well.

Great. Thank you, Mr. Chair, Committee Members. Good morning to you all. Appreciate the opportunity to talk about eliminating fees when it comes to building housing. This is Assembly Bill 2430. We started the conversation on this bill back in December. It's a conversation that has been very active between stakeholders and certainly the Committee. Appreciate the staff for the consistent feedback, and you have amendments today before you that are reflective of that feedback, which, of course, we will be accepting.

Assembly Bill 2430 would exempt a local developer from paying an extra, unnecessary, and duplicative fee, called a monitoring fee, on projects that are affordable in nature and by requirements. Only projects that use a state incentive, known as the State Density Bonus Law, and is subject to regulatory agreement between CTCAC, CDLAC, or HCD that has monitoring provisions built into it, are eligible for this exemption of this fee.

To ensure that this bill only targets duplicative monitoring, the Committee amendments also exempts projects that use a local density bonus program that require deeper affordability and accept a local funding source that requires different levels of affordability and has a funding source that obligates the locality, the local government, to monitor that project if it isn't already being monitored by the agencies I mentioned earlier.

As many of you know from serving in local government, all affordable housing developments in California that receive state funding are subject to compliance with monitoring that ensures that the units are occupied by a tenant who's actually eligible at those income levels to live in those units. CTCAC, for example, the Tax Credit Allocation Committee, routinely has physical inspection--site inspections of units on the conditions, property standards, and the share of affordable units at every development site.

There is an annual file monitoring of the tenant's income over the 55-year lifespan that these projects remain affordable, and physical inspections are also done on an as-needed basis when it discovers or reports of any problems. Although some cities rely on state monitoring activities alone, others choose to charge developers additional fees to cover their own duplicative monitoring activities that largely mirror the state's activities. These fees are not trivial, although they can vary.

Most fees that are charged annually can be up to 400 dollars per unit. This results in a cost of tens of thousands of dollars a year and over the lifespan certainly could be in the hundreds of thousands and potentially millions, depending on the size of the development. The duplication of monitoring fees adds unnecessary costs to affordable housing developments at a time when we we are obviously looking to build more of it and projects are struggling to pencil as we hear.

This is especially pertinent when considering how expensive it is, housing in general and affordable housing in particular. AB 2430 provides relief by removing this duplicative fee and therefore lowering affordable housing development costs and bringing California a little bit closer to meeting all of our housing production needs. With that, I'll turn it over to our two witnesses. We have Graciela Castillo-Krings from the California Housing Consortium and Natalie Spievack from Housing California.

Thank you.

Good morning, Mr. Chair and Members. Graciela Castillo-Krings. I'm here representing the California Housing Consortium. I really wanted to say thank you to you and your staff for the numerous hours you have spent working with us on this bill. Really appreciate the work. A little bit about the Housing Consortium: we are a nonprofit organization that advocates for the production and preservation of housing affordable to to low and moderate-income Californians.

Tackling housing crisis will require building affordable housing at scale, but our ability to do so depends on how expensive it is to produce these units. As those cost drivers continue to go up, that means we either need additional funding from the state or the units will not be produced. And as many of you already know, we are running out of General Fund subsidies, we don't have a housing bond, so some of the areas where we can save money become absolutely critical.

One of the things about this bill, it is actually hoping to have a balance between compliance and making sure that we are reducing the cost wherever possible to produce affordable housing. Back to what the Assembly Member was saying, based on the average cost, projects can pay around 600,000 dollars to 1.9 million. And that may not seem like a lot, but that's an addition to additional costs for insurance, making sure operating costs are going up.

So the reality is, when we ask ourselves why affordable housing is so expensive to produce in California, we have the reasons. So we ask for support on this measure. Again, we were trying to balance how to ensure that we are producing affordable units at the lowest cost possible, because at the end of the day, it requires state subsidy. So less money to produce affordable units means less state subsidy.

Thank you.

Good morning, and thank you for the opportunity to speak today. My name is Natalie Spievack, and I'm a Senior Policy Advocate at Housing California, which is a statewide nonprofit advocacy organization that works on ending the affordable housing and homelessness crises. As the Assembly Member and Graciela have explained, AB 2430 will play an important role in tackling the affordable housing crisis by bringing down the cost of development for affordable housing. I'd like to briefly dispel some potential concerns about the bill.

First, AB 2430 only applies to 100 percent affordable density bonus developments that a state agency is already monitoring. For example, a local government can continue to monitor affordable units produced through a local inclusion housing ordinance if the state isn't monitoring them. Second, this bill does not compromise the ability of local governments to comply with monitoring activities required of them by federal, regional, or state agency. If the required monitoring activities are not being conducted by CTCAC or HCD, the local government may carry them out.

Finally, some local agencies use monitoring fees to provide services unrelated to maintaining the affordability and habitability of units. We don't intend to suggest that these services aren't valuable, but rather that they shouldn't be placed on the backs of affordable housing developers under the guise of monitoring fees.

If we make affordable housing developers responsible for paying the cost of anything that's good, affordable housing will not be financially feasible. At a time when it's already very difficult to make affordable housing pencil and when California is facing potential budget cuts to key affordable housing production programs, it's even more critical to eliminate duplicative costs faced by affordable housing developers. AB 2430 will make important strides toward that end. Housing California thanks Assembly Member Alvarez for authoring this important piece of legislation and respectfully requests your aye vote.

Thank you. Are there any other members of the public here in support of this item?

Mary Ellen Shay, California Association of Local Housing Finance Agencies, in support.

Thank you. Seeing no other, nobody else wishing to be recognized, are there any testimony here today in opposition to this bill? Seeing none, any members of the public in opposition to the bill wishing to be on the record? Seeing none, we'll turn it back to Committee comments. Moved by Ms. Reyes and a second by Ms. Quirk-Silva. Assembly Member Grayson.

Thank you, Mr. Chair. Just to clarify--and excellent testimony. Thank you very much from the witnesses. Author, thank you so much for the bill coming forward. We've got to figure out ways to get affordable housing. I know we have a very large agenda today, so I try to keep my comments short and not comment on every bill. However, on this one, I just want to clarify: this only applies to developments where HCD or federal level are not monitoring and that the city will then--the only entity that would monitor it is the city then. Is that?

No. So this bill would eliminate the need for cities that sometimes do monitoring that is duplicative to what already the state is doing in terms of monitoring.

Right. So they're already being monitored. This is completely duplicative of what's already being done?

Correct.

And the city is relieved of the duty or responsibility of monitoring?

And the amendments that we take say that except in the case where perhaps the city is requiring a deeper level of affordability, which means then they need to go and make sure that the affordability is maintained at that level. So if it doesn't match what the state is requiring, then the city could go and do monitoring and charge those fees.

Thank you for the clarification, sir.

Thank you. I see no other Members wishing to address the issue. I want to thank you very well for working really closely with your sponsors, other supporters, and the opposition. I think the previous opposition as well. I believe they're removing their opposition with your amendments. I think it's critically important that, one: we're not duplicating efforts here. We shouldn't be doing that.

And so you were righteous to be able to bring this bill forward and make sure that we are helping to save costs at the front end and reduce that duplication effort between state and local governments. And it's also critically important as well where there are local programs that are a little bit deeper, a little bit more stringent than state requirements as well, that somebody is in charge for ensuring compliance, right?

We don't want somebody--when we already don't have enough low-income housing in our communities--we don't want somebody who is of wealthy means taking up that unit. We've got to make sure--and that's just one example of what they do in monitoring situations.

So I think you've struck a really strong balance and I know that these amendments--because of a timing issue, we don't want to hold you up with local government--will need to be taken in that Committee, but I appreciate your commitment to that end. With that, would you have anything you would like to close with?

Just again, thanking the staff for the ongoing conversation on this, helping us get to where we are, and we'll continue to look at ways that we can reduce any fees, no matter what the size are, to produce the affordable housing that I know we all support. And I ask for your support of our bill today.

We will do that. Thank you, Mr. Alvarez. Madam Secretary, please call the roll.

Motion: do pass to the Assembly Committee on Local Government. [Roll Call].

That measure has seven votes, it is out, and we will hold it open for absent Members.

Thank you.

Thank you very much.

Thank you very much. We are going to put out the call for any Members on the agenda today to make their way to the Committee room to be efficient with our time. Trying to see, do we have any Committee Members yet? We can do consent. Absolutely. Thank you for the reminder. Madam--motion by Mr. Lee, second by Ms. Reyes for the consent calendar. Madam Secretary, please call the roll.

Consent calendar.

[Roll Call]

The consent calendar has seven votes. Those items will be out. We'll hold rolls open for absent Members. Still seeing no Members again. Reminder to mention Members on the agenda. Please come down to room 126 to present your bills. In the meantime, I'll take up one Bill Mister Vice Chair. I'll pass the gavel to you. I'll begin with item number 14 AB 2893.

Great. Well, thank you Mr. Chair, Members. I want to start by thanking our Committee staff for their hard work on this bill. As California continues to navigate the mental health needs of our unhoused population along with the state housing crisis, we've learned these issues are often intertwined. Many unhoused Californians are there because of a lack of affordable housing options, and it creates a negative and unstable situation that often leads them to drug use or major mental health problems.

And once a person begins struggling with addiction and their mental health problems that come with that, it becomes harder for them to find housing. It's an endless cycle. Some of our sober living facilities are often too strict and unstable for their situation, and temporary housing is not long term enough for them to adequately navigate themselves out of their addiction.

An option that's been working for people who find themselves in this position is recovery housing, which focuses on treatment, but not to the extent of clinical settings. Recovery housing allows flexibility and is stable enough to provide an environment where people can successfully progress out of their addiction. AB 2093 will establish a state certification process for recovery houses through the Department of Healthcare Services.

This certification would standardize care requirements for all recovery houses in California while while also making it available as a tool that the state can use to address and treat our unhoused population. I have testifying in support of this bill, Amy Hines-Shaikh on behalf of the SHARE! Collaborative Housing and we respectfully request your aye vote.

Honorable Chair and Members, Amy Hines-Shaikh representing SHARE! Collaborative Housing. SHARE! was started by people in recovery from trauma and mental health issues and currently operates 35 recovery residencies assisting Californians in need. SHARE! Collaborative Housing is a public, private solution to housing for people with disabilities that uses evidence-based, peer-to-peer practices and self help support groups. A couple of stories of impacted folks. In December of 2023, a 52 year old man was homeless and sleeping in a parking lot in Cerritos.

He had lost his previous job during the pandemic, causing him to experience homelessness without any social support. His PATH case manager referred him to SHARE! and that same day we housed him in a SHARE! collaborative house in East LA, not far from his only family member and only form of social support until he became homeless. His SHARE! peer specialist immediately helped him connect to a full time job in a field he loved.

He received lots of peer support from SHARE!, who even helped him reunite with his only family member, his uncle. Also in January of 2024 this year, a 22 year old woman, a former foster care transition-aged youth, was living in her car in Whittier. SHARE! moved her into a SHARE! collaborative house nearby and connected her to SELACO, SHARE!'s Gateway Cities employment partner, who enrolled her into a state-sponsored employment program, which she successfully completed. SHARE! and SELACO then connected her to a job.

SHARE! recently helped her move successfully from her collaborative house into a market rate apartment, and she's now completing online classwork for her college degree. AB 2893 Ward would require the Department of Healthcare Services to oversee certification of recovery houses that serve individuals experience experiencing or who are at risk of experiencing homelessness or mental health issues. This would establish recovery houses at the end of the continuum of care that does not provide any licensed medical services on site.

This definitional bill is crucial to ensure that during these difficult budgetary times, only the most effective programs that have a certified and proven track record should gain access to our strap state funds. We respectfully request your aye vote for AB 2893. Mr. Ward, we appreciate your leadership. Thank you.

Great. Thank you. Are there any other witnesses in support? Seeing none. Any witnesses in opposition? Primary witnesses? Seeing none. Any opposition at all? Seeing none. Mr. Kalra.

Thank you. And thank you, Mr. Chair, for bringing this forward. As someone that for several years represented individuals and drug treatment in court, one of the biggest challenges was finding appropriate housing, especially for those grappling with addiction. And there just aren't enough places for those that really want help and are trying to turn their lives around.

The court's trying to give them guidance and probation is trying to supervise them. And ultimately, if you don't have appropriate housing, it's next to impossible to take the steps necessary to really turn your life around. And so I appreciate this legislation. I think it's going to save a lot of lives. Thank you.

Anything else?

I want to thank the author for bringing this forward. This is a very important part of meeting the needs of Californians, as many of us know, that have interfaced with housing and homelessness. There is a certain population that needs these recovery homes. Too often though, we are seeing proposals to shut them down and move them out of certain areas. And again, this does not meet the needs of Californians.

So with that, knowing that this is a specific population that needs specific types of trauma-informed practices, and it is part of the puzzle to housing, and we need this piece of it. With that, I support it. And thank you.

Great. Thank you. Any other Committee Members? Nope. Appreciate this. I know I have concerns anytime we add responsibility for DHCS, I've been having-- we have Prop 1 items, we'll be going through them, and I've been working with them, with some people with developmental disabilities, and it's been very difficult. But I know where you're going with this and appreciate your work on it. So with that, we do have a motion and a second, and you want to take roll.

I'll just go if I could.

Oh, yeah. Sorry about that. You're the chair.

Thank you for the supportive comments as well. And I just wanted to highlight that this bill really came from those who are running these programs. I want to thank them sincerely for working really hard with a very challenging situation and for people that need the totality of support that they do need to get on the right paths, but they want to step up.

They want to be able to meet standards that are going to be able to help them perform better, kind of as a class of housing opportunities. And this bill is going to get us to that end. I respectfully request your aye vote.

Thank you. Please take roll.

Motion due pass to the Assembly Committee on Health. [Roll call]

He's stuffing the ballots over there. Six/zero; that's out. All right, six/zero; that bill's out.

Thank you, Mr. Vice Chair. We will be going back on file to Assembly Member Ting with File Number 18. This is AB 2967. When you are ready, you may begin presentation.

Thank you, Mr. Chair. Today I'm presenting AB 2967, which expands the Teacher Housing Act to include employees of publicly funded nonprofits that operate on school district property and serve children from low and moderate-income families. We all know we have a housing crisis. In particular, so many districts have a very difficult time employing teachers and many of their staff because there just simply isn't enough housing. That's why we passed the Teacher Housing Act in 2016.

This would expand it to include the opportunity to include the qualifications so that nonprofit educators who are doing work in those districts can also participate in this. One of my districts in Daly City has put housing on their administrative property. Has been a huge success. They've been able to build it relatively quickly.

But within that same county, San Mateo, we're realizing that we have nonprofit educators who are after-school providers, really are part of the school ecosystem, part of the school process, but because they're technically not district employees, they don't qualify. This bill would simply allow them to qualify. Respectfully ask for your aye vote for that. I have Raymond Hodges, who's Director of the San Mateo County Department of Housing. Thank you.

Thank you. Up to two minutes.

Thanks. Good morning, Chair Ward, Honorable Committee Members. I'm Ray Hodges. I'm the Director of the Department of Housing in San Mateo County, and I'm the Executive Director of our county's Housing Authority. Happy to be here this morning in support of AB 2967. The 21 jurisdictions in San Mateo County make up one of the highest cost areas of the state, but we have plans to build 20,000 new units of affordable housing for our lower income residents over the next eight years.

And one of the most substantial projects in our pipeline is the redevelopment of a site in Daly City called Midway Village, which includes property owned by our Housing Authority and a local school district. We just completed construction of the first of four phases at the property. The redevelopment in some will replace 150 aging units and an outdated early learning center with 550 new affordable homes and a brand new and expanded early learning center.

One request we heard repeatedly during community outreach for the project was a desire to provide a preference for early childhood educators. In California, early childhood educators earn almost 40 percent less than their colleagues in the K through eight system, and many would be considered extremely low-income in our county where the two bedroom FMR is nearly 3,400 dollars. These early childhood educators face housing insecurity and are often forced to leave the profession, find second jobs, or undertake very long commutes that can separate them from their own families.

There have been several bills passed in recent years supporting housing for teachers and school district staff, but early childhood educators are not currently eligible for affordable housing developments under the Teacher Housing Act of 2016. So AB 2967 would extend affordable housing opportunities to nonprofit early learning center employees that set children of low and moderate-income families on a path to strong academic outcomes, which is a goal we strongly support. Thanks for your consideration.

Thank you. Are there any members of the public here in support of this item?

Chris Lee, on behalf of the Urban Counties of California, in support.

Thank you. Seeing no other members of the public wishing to register opposition, are there any witnesses in opposition? And seeing none, anybody else that wishes to register opposition? Seeing none, we'll turn it back to Committee. No Member comments on this? Fantastic. Well, I think it's a pretty straight--I looked at everybody, Mister Vice Chair.

You're just thinking of the last one in my scope. Okay. Mr. Ting, thank you so much for working on this measure. Let's see. I think a number of us have been working to make sure that we're providing more housing opportunities for teachers here at the K12 level. Certainly, I've got one that I'm working on right now with the CSU, previously community college district, so improving on this, I think, is ultimately going to be able to--

And what you're doing here on updating some of the definitions is going to be able to expand some of the opportunities and situations like this. Thank you to our witness for your commitments locally to be able to be a partner in producing more affordable housing. Will enjoy an aye recommendation. Anything further to close?

Just respectfully ask for your aye vote.

Thank you. Madam Secretary, please call the roll.

Thank you.

Motion: do pass to the Assembly Committee on Local Government. [Roll Call].

That vote has--that item has six votes, it will be out, and we'll hold the roll open for absent Members.

I'm sorry. 2967: the motion was actually to Assembly Committee on Education. Can we correct that?

Okay, that's corrected for the record.

Correcting for the record: AB 2967: the motion is 'do pass to the Assembly Committee on Education.'

Thank you, Madam Secretary. Unless another Member jumps in that door, I have a second bill to present. Seeing none, Mister Vice Chair. Again, a call to offices. I think we have about six or seven Members that still need to present before this Committee.

Great. Thank you. Is this AB 1932?

But I did want to walk through this because I think it would have a significant impact for the work that we're trying to do here in a very challenging budget year. You all know the Governor is proposed $1.2 billion of reductions for housing and homelessness affordability programs. That's something that would be a very strong setback for the goals that we know we need to reach. 181,000 Californians experiencing homelessness at the last time of our point in time count.

Yes, Mister chair, this is AB 1932. File item three. Thank you for the faith.

And so I would argue it's the worst thing on one of our biggest issues to be regressing on some of these funding streams. And it's on us as a Legislature to come up with counteroffers or to find solutions. And that's what this bill does. Now, the mortgage interest deduction can be viewed certainly in a lot of ways, but one way to view it is that it is a major tax benefit offered to existing homeowners every year, without question.

In fact, of all of our housing programs, it's actually the largest fiscal benefit that the state offers from state resources that otherwise would come in. We're not for that benefit, 3.5 billion dollars is returned to homeowners. And I'm not proposing and I would not propose to touch the mortgage interest deduction for primary homes. There's significant benefits to both the homeowners and communities alike.

However, there are a number of taxpayers who also get to deduct a mortgage interest on their second home or their vacation home, as well as their primary home for mortgages up to a cumulative total of $1.0 million. I argue that's a wasteful and inefficient use of a public resource monies that we believe from Department of Finance initially, that could amass to about $200 million or 1/6 of our shortfall to restore some of the critical housing and homelessness programs that we need.

According to FTB, the tax filers that takes this deduction for a vacation home receive approximately $1,100 in tax benefit. It's disproportionately accruing to wealthy homeowners with larger mortgages. It's also important to note that these are personal residents, not permanent rental units. Meanwhile, the renter's credit has been frozen at $60 here for single filers, $120 for joint filers over four decades. These kinds of fiscal policies are deeply inequitable when at a time over two thirds of Californians are spending half of their income or more on housing.

With this bill, AB 1932, I am proposing that the state stop subsidizing for purchasing second homes or vacation homes and instead use that $200 million to permanently. We talk often about this one time funding, and we need to find permanent funding streams. This bill would permanently increase home ownership opportunities for first time buyers and build desperately needed affordable housing for our extremely low income constituents, helping our housing voucher recipients find apartments easier.

With me today to testify is Chris Martin, the Policy Director for Housing California, and Lahela Mattox, the Chief Operations Officer for the San Diego Regional Task Force on the Homeless.

Good Morning Vice Chair and Committee Members. My name is Chris Martin, Policy Director at Housing California. We are a statewide advocacy nonprofit focused on the production and preservation of affordable housing, protecting low income renters, and ending homelessness. Housing California is proud to support AB 1932, which would remove the second home mortgage interest deduction and target resources to critical investments in housing production, home ownership and tools to help utilize federal housing vouchers.

Despite nearly tripling our production of affordable housing in the last four years, thanks to critical streamlining laws in unprecedented state investments, we still only fund about 20% of what is actually needed to meet our goals. On top of this, we are seeing funds from proposition one in 2018, our last affordable housing bond dry up this year, and as you know, we are facing a significant budget shortfall and the Governor is proposing cutting all state investments in housing committed in previous years.

This would lead to a loss of over 6,000 new affordable homes over the next two years. Additionally, for both recent rounds of notice of a funding availability from our Department of Housing and Community Development in the past year, the funds were oversubscribed 10 to 1, and new research from the enterprise community partners shows that our pipeline of affordable housing has about 46,000 units simply awaiting funding. This all points to exactly why we need an ongoing source to increase affordable housing production.

We cannot rely on the volatile ebbing and flowing of state budget to fund affordable housing in one time spurts. We're facing an ongoing crisis that requires ongoing resources. AB 1932 presents an opportunity for us to create a reasonable ongoing funding source.

Our tax system should reflect our values and in a state with over 170,000 people experiencing homeless and a shortfall of over 1.2 million homes, we should be subsidizing someone to access their first place to call home before we subsidize largely wealthy homeowners to purchase a second home. Housing California applauds Assemblymember Ward for his vision and effort to provide resources for low income Californians to access their first affordable home and respectfully ask for your aye vote.

Good morning. Thank you. I'm Lahello Maddox, the Chief Operations Officer with RTFH. We are the lead agency for the city and County Continuum of Care, RTFH, and administers the core federal functions of a continuum of care, two of which those primary's roles are data and best practices. While we recognize the number of people experiencing homelessness continues to rise, we are housing thousands of people, utilizing the one time state funding and other resources.

However, the number of people falling into homelessness is increasing at a rate that exceeds the number of people we are housing on a daily, monthly and yearly basis. We have limited housing stock and high rental markets, especially in San Diego. As a leader in data and best practices and as we face cuts, we need to focus on what is working. We know that housing people and keeping them housed works.

RTFH has utilized the one time state funding, both the Homeless Emergency Aid Program known as HEAP, and the current HAP rounds of funding to focus on establishing what we call a flexible housing pool model. This creates a portfolio of private rental market units and provides landlord and tenancy supports and incentives.

Over the last three years, we have housed more than 900 individuals and families, and this included partnering with our housing authorities and leveraging these funds with those that have vouchers. We've successfully housed over 400 veterans as well as folks who received emergency housing vouchers from HUD during the pandemic. We have a 95% retention rate success after three years, which far exceeds the national average of 82% retention rates.

We spent about $9.3 million over the last three years, which works out to about $10,000 per household to permanently house and keep someone housed. An ongoing, dedicated revenue source will allow us to maintain and expand this model. Again, only $9 million going into this project has housed over 900 people. This successful model can be expanded and should be focused on when we are looking at the limited resources ahead of us.

We must build and effectively utilize the rental market in order to get out of this crisis. We must maintain our commitment to building a better California and identify ongoing sources of funds to house Californians. We thank Assemblymember Chris Ward for bringing this forward.

Thank you very much. Any other support, please come to the microphone and name and affiliation. Thank you.

Mister Chair and Members, Rand Martin. On behalf of the AIDS Healthcare Foundation and its Healthy Housing Foundation in support of AB 1932. Thank you.

Graciela Castillo-Krings here on behalf of All Home in strong support. Thank you.

Mary Ellen Shay, California Association of Local Housing Finance Agencies in support.

Good morning. Rafa Sonnenfeld, YIMBY Action in support.

Mark Stivers with the California Housing Partnership in support.

Brian Augusta with the California Rural Legal Assistance Foundation, Public Interest Law Project in support.

Thank you. Any primary witnesses in opposition. Thank you. You have 20 minutes. I'm just joking, just kidding. Two.

Chair and Members, Vanessa Chavez with the California Association of Realtors here in strong opposition to AB 1932, this measure penalizes California families who have made a significant financial investment by imposing a tax increase on homeowners by eliminating the mortgage interest deduction on a qualifying second residence. This change would hurt those working families who have taken on the significant financial investment in home ownership.

Let's be clear, the mortgage interest deduction in our current housing market will likely only apply to the principal residents due to the high cost of housing. For families who take on the second loan, it is often to meet the needs of their family, whether that be in the form of generational living, by caring for an elderly loved one, or to provide shelter suited to the demands of their dynamic family.

For example, if they're a first responder, a firefighter, or a member of law enforcement, or even a Member of another profession seeking to balance family life and their hybrid work schedule in this ever evolving post pandemic work environment. Further, one in three Californians itemize their returns. California is generally regarded as a high cost state where the median household income sits at right under $100,000, as found by the US Census Bureau.

That trend is ever more prevalent in coastal areas such as San Diego, where the median household income checked in at just shy of $99,000. Additionally, it is worthwhile to highlight that such a change in the law will likely not result in a cost saving to the state, but will actually result in increased costs due to the implementation and the nature of tax preparation. Right now, taxpayers have the option to itemize these deductions.

Without this provision in the law, it is not entirely clear how the FTB would mandate a taxpayer to report these costs. Why wouldn't a taxpayer instead claim the standard deduction rather than itemized? This goes to the heart of the argument regarding the inability to accurately track funding for this program.

We believe that such a change in the law would in fact accelerate the outward migration of California residents, as this measure will result in a tax increase on California's working families who are struggling to meet the needs of their families in this volatile economy. For these reasons, we must oppose this measure and we respectfully request your no vote.

Thank you. Any other witnesses in opposition?

Hi, Indira McDonald, on behalf of the California Mortgage Bankers Association, respectfully opposed.

Thank you. Any Committee Members? Mister Lee.

I want to thank the Chair for bringing this bill forward and your leadership on this effort. I'm a proud co author on this measure and love to see that this measure is advancing where as I have done this bill two years ago and David Chiu before us had also done the bill several times.

This is a great inequity in our system and the fact that the mortgage interest deduction, which primarily benefits primary residents, this is true, but still subsidizes people who buy, who buy their second or vacation home, is a great travesty, especially when we have a budget deficit situation now where billions of dollars are being cut from the budget. Even estimated right now that we could save roughly $200 million per year just on a limiting mid on those vacation second homes.

Now I heard from the opposition, and I'm very acutely aware, that even in my district, a family of four, the area mean income is 1120k. But they save and work very hard to get to their first home. And they, my own constituents are appalled that when they save so hard to get to their first home, there are people using the same tax break. This is government money being given to them as a tax break to buy a second home or a vacation home.

When they have worked so hard to get to their first home. In fact, half of Californians own zero homes, and yet we are subsidizing people to vacation homes. And to have multiple homes at once is ridiculous. I really like this part on page four of the analysis that points out the disparity between an equity in our budget, the renters tax credit, which has been frozen for decades.

It would take a single filer 18 years to recoup the same amount of tax benefit tax break as one person recoups from the second home MID 18 years. And a family of two would take them nine years to do so. We really have an inequitable system right now. And if we want to expand the California dream for everyone, we should be focusing the dollars on making sure that more people become homeowners, not become multi homeowners.

And especially at a time when a lot of our budget is being slashed right now, I think it's very smart that our chairs proposed a formula of putting it to homeownership, into homelessness and to rent relief. This is very smart to do so, especially when we're losing all this money out there. And this is very sustainable to do so. And even in the horizon, too, the Federal Government might make changes that affect the MID, which this would be even more smart to do so.

So I'm a very proud co author of this measure. I believe it's a very smart measure need, especially in our budget context right now, and I'm very proud to support it today. Thank you, Mister chair.

Thank you. Anybody else? Miss Reyes?

Thank you. This is a very important measure. The one comment that was made by the opposition is with our first responders, who because of their job duties, may have to have a second home to live in. And something just to consider as you're going through the details of this. But I absolutely agree with my colleague with all of his comments.

The way the money is going to be divided also is genius, because if what we're trying to do is increase home ownership for everyone else, take that tax break and give it to others, I think that just the way that you've set it up, but very specifically with the 25% going to the housing navigation services, it's so important to have people housed and to provide the services. And the other 25% for first time homebuyers, we know that CalHome in this budget lost $150 million.

To be able to recoup part of that through this program would be extremely important, provide more opportunities for homeownership, for others. So if it hasn't been moved it. Has moved it. All right. Thank you.

Great. Thank you. Oh, I'm in. Oh, did you have a second motion? Second? Okay. She wrote it down. Probably not very surprising to you that I have a lot of concerns about this. I was pleased to see Mister Lee support increase tax credits for renters. Is that what you're advocating for? I'll go for that. But a question for maybe the supporters is I think there's talk about a housing bond. Multibillions of dollars.

We spend hundreds of millions of dollars on other housing situations. Communities are giving a lot of money of their own. And if, let's say, resident X, Y, Z loses this deduction, that one person losing the deduction, how does that help somebody else purchase a home?

I know there's a lot of other solutions. And I'm grateful for all of our colleagues trying to figure out how to either restore many of these cuts or more importantly, propose stability in our homelessness and housing programs going forward.

And so those being separate questions worthy of this debate. What this bill strictly does is really recognize that this is really a fiscal trade off. It technically is a balance of revenue. Right. You're either going to be subsidizing and losing revenue over here or to vacation homes, or you're going to be spending revenue on programs that we desperately need. One way or another. We're trying to balance the books here in our state. And we're trying to make sure that our fiscal policies align with our priorities.

You know, we've worked a lot as a Committee together to try to increase the opportunities for people to have homeownership. And I'm supportive of those efforts. You know, this is, I think this represents about, I think two tenths of a percent of the deficit that we're in.

And my concern is that this will have big impacts on the assumption that everybody, I grew up not owning a house or my parents don't own a house to this day. Very. We should increase the renters tax credit. I support that. But I feel like the assumption that we got to take away from people who may have worked their entire lives and they have a couple houses. Yeah, that could be all their investments that they have too.

And I just think it has a really big impact on a wide swath of people that does it only go after the people? I think that you're maybe trying to address maybe the wealthy and things like that. But anyways, I appreciate you always, but unfortunately I have to oppose this bill. So thank you.

Thank you Mister Vice Chair, I appreciate your thoughts, and I would want to echo that. I had a chance early, before we had memorialized this and put this into print, to meet with opposition, knowing some history that this Committee has enjoyed on trying to debate this issue and the deep concerns that the opposition holds. And I don't. I don't dismiss those at all. So we will continue to work on those.

We want to make sure that this bill does not affect second units that are going out to rent. Right. Because ultimately, those rental units, were there to be a fiscal impact on those would be passed on to the renter. And we don't want to see that happen either.

But the important thing is to recognize that, especially, especially in today's challenges, where we're looking for solutions to have a balanced budget and we're monitoring what we are doing with our fiscal policy decisions with regard to housing finance, that this is a Bill that partially solves that historical inequity there. I would respectfully request your aye vote.

Great. Thank you. With that, you can take a roll.

Motion is due passed to the Assembly Committee on Revenue and Taxation. [Roll Call]

Four to one. So we'll keep it open. It's on call. Great.

Thank you very much. A reminder to offices to send authors to this hearing room 126.

Yes, or the Chair is going to get very upset.

We're going to ask Madam Secretary to call the roll on the items for Miss Sanchez. And Mister Lee, if you missed any too. And Mister Kalra, we'll find out.

Item number one. AB 1840. [Roll call] Six to two.

Current count is six to two.

Number. Item number three, 1932. [Roll call]

Current is 5-2. That Bill will be out. We'll hold the roll open for absent Members.

Item number seven, 2430. [Roll call]

Current count is eight to zero.

Item number eight, 2485. [Roll call]

Current vote is eight to zero.

Item 19. 18, I'm sorry. AB 2967. [Roll call]

Current vote is seven to zero.

And I believe we have the consent calendar. On the consent calendar. [Roll call] That'll be eight to zero.

Eight to zero is the current vote on the consent calendar. Thank you, all.

Miss Sanchez, we have one more if you'd like to add on. You're welcome.

And there is item number 14, AB 2893. Not voting. Thank you.

That vote is still six to zero. Okay, we will resume business, and we are very excited to again, welcome back our former Committee chair.

Are we doing? Doing builders' remedy first. Hi.

Who has two very important bills, and Miss Wicks, I will need to go present a bill in another Committee right now. So at the moment, with our Vice Chair adding on to other votes, I'm going to turn the gavel over to Mister Grayson, if that's okay. Are you available for some time? Great. So you got two very important bills to present. I'll let Mister Grayson kick us off.

Thank you, Mister Chair. Thank you for your support on both of these bills. Okay. I'm here to present AB 1893, a Bill to modernize the Builder's Remedy. First, I'd like to thank staff for their work on this. I'm happy to accept the Committee's amendments to change the inclusionary from 10% for low-income households to 10% for very low-income households. Let me start off by describing what the Builder's Remedy is.

Then I can share why it needs modernizing, and then I'll finish with a description of how we're planning to modernize it. The Builder's Remedy is a part of housing element law that says that if a city or county does not have a housing element that is compliant with state law, that city or county cannot deny a housing project merely because it does not comply with the local general planning or zoning.

Essentially, in jurisdictions without a compliant housing element, it allows the developer to propose a project that can be of any size, anywhere in the jurisdiction. If that sounds scary, it's because that's on purpose, because it is meant to compel cities and counties to complete their housing element, which we really, really want cities and counties to do. We would like them to adhere to their housing element. Why?

Because we have a massive housing crisis, and the housing element is the contract between the local government and the state. That shows how local governments is going to help solve our housing crisis. It shows how they are going to zone to allow housing at all levels of affordability. It shows how they are removing constraints from their housing approval process. It shows how they are going to affirmatively further fair housing.

When a city or county has a compliant housing element, that means that the state thinks it's doing its part to address a collective societal problem. Unfortunately, we have over 200 jurisdictions, about 40% of the total. That are out of compliance with housing element law. Those jurisdictions are essentially saying that solving the housing crisis is not their problem. This is where the Builder's Remedy comes into play.

Theoretically, in noncompliant cities and counties, we'd be seeing lots of Builder's Remedy projects that result in lots of housing, so that ignoring state law did not mean an end to housing production. Unfortunately, the builder's remedy has not functioned in this way. Yes, there are now at least 100 Builder's Remedies projects proposed in the state, and we have appreciated the efforts of those developers to get housing built in these jurisdictions.

But we've observed that those projects have a hard time getting to the finish line because the law includes enough ambiguities that make the projects difficult to process and easy to delay. This riskiness is also a turn-off to a lot of developers that otherwise would like to build in these cities. The law also includes an affordability requirement of 20%, which sounds noble and lofty, but actually makes most housing projects economically infeasible.

The result is that the current Builder's Remedy isn't enough of a credible threat to get those 200 plus jurisdictions into compliance with state law, which is why we need to modernize the law. Working with our sponsor, Attorney General Rob Bonto, we have crafted a Bill that removes any ambiguity about where the Builder's Remedy would apply, how much density would be allowed, and what objective standards would apply. It also enhances feasibility by reducing the affordability requirement to something that does not render projects infeasible.

Now, I know there are those who don't like the reduction in affordability requirements. To those, I say 20% of nothing is nothing. We need something that is feasible and that will result in actual affordable units in noncompliant jurisdictions. And we also know that there are cities and counties who might be concerned that this Bill overrides their zoning to facilitate too much housing. To them, I say, please complete your housing element.

But I'll add, I know that the 6th cycle was very challenging, and I'm committed to working with the cities and HCD to make it a better process for all. We want 100% of cities and counties to have compliant housing element and to do their part to address the housing crisis. But if you refuse to comply with state law, there should be consequences, and I can't think of a better consequence in trying to stop housing than in fact, more housing.

Here to speak on behalf of the Bill are Jana Staniford, representing the Department of Justice, and Debbie Arakul, Executive Director of Habitat for Humanity. We are also joined by Alex Fish, Special Assistant Attorney, Special Assistant to Attorney General, who can help answer questions.

Thank you for your presentation, Assembly Member and two minutes for the two primary witnesses. Two minutes each.

Thank you. Good morning, Mister Chair and Committee Members. I'm Jana Staniford, Legislative Advocate and Deputy Attorney General in the Attorney General's Office. On behalf of Attorney General Rob Bonta, I want to start by thanking Assembly Member Wicks for authoring this Bill, which the Attorney General is proud to sponsor. The Builder's Remedy has been on the books since 1990.

It was intended to serve as a compliance tool to encourage local governments to adopt their housing elements and to provide a path for housing development even when local government fails to do so. Unfortunately, the lack of clarity in the existing Builder's Remedy statute has led to local disputes and litigation, which is delaying projects. AB 1893 would clarify the Builder's Remedy and bring it into the 21st century. A lot has happened since 1990.

This Bill would align the builder's remedy with a plethora of other state laws that have been passed since the Builder's Remedy went on the books 30 plus years years ago.

Like AB 2011, SB 35 and 423, and recent revisions to the Housing Accountability Act and Density Bonus Law, the Bill also aligns the Builder's Remedy with other state priorities that have emerged since the Builder's Remedy was adopted, like sustainable community strategies promoting housing development in urban infill and near transit centers, and environmental justice considerations like keeping residential housing away from industrial uses.

We want cities to plan for the future, but if they won't, Builder's Remedy should promote housing development in places where it makes sense by modern day standards. AB 1893 would also recognize that housing affordability has spiraled out of control. Hardworking Californians at all income levels are struggling to find and afford housing. We need more affordable and mixed-income housing to be built, and we need many more smaller projects to be built, like townhomes, which have lower price points than single family homes.

AB 1893 would make the builder's remedy work better, would provide clarity for developers and city planners in courts, and create additional opportunities to build housing and meet the needs of hard working Californians. We respectfully ask for your aye vote.

Thank you. Two minutes.

Good morning, Committee Members, and thank you for the opportunity to testify. My name is Debbie Arakel and I'm the Executive Director of Habitat for Humanity California, and I'm here today representing the views of all of our statewide Habitat affiliates representing and operating in 42 counties, and we strongly support AB 1893. We believe in using all the tools in our toolbox to build affordable housing. And this legislation calls on local governments to join us in these efforts. Let's not spend time litigating.

Let's spend our time building affordable housing together. At Habitats across California, we've built thousands of homes and are in the process of building hundreds more. Habitat homeowners earn 30% to 80% of the area median income. And we are so proud to say that 83% of our homeowners, our habitat homeowners are Black, Indigenous, and people of color. Habitat is uniquely positioned in this homeownership space as a builder, developer, mortgage lender and community developer.

We support AB 1893 because we believe a more effective Builder's Remedy will encourage cities to adopt robust housing elements with strong affordable housing programs and on time. Through the implementation of the revised Builder's Remedy and partnering with builders like their Habitat for Humanity Chapter and other small site builders, cities can ensure we meet our collective goals of affordable housing in all communities or be accountable through reasonable consequences.

AB 1893 would finally amend the current Builder's Remedy and address the systemic ambiguities and challenges. This Bill brings clarity to the rules for jurisdictions to get into compliance. Habitat across the state is ready to partner with our cities and municipalities to build more homes for 100% affordable home ownership. We need to use the tools like AB 1893 and others to hold each other accountable and commit to meeting our requirements through collaborative solutions and more housing together.

I am grateful for your thoughtful leadership on this important legislation and I urge an aye vote. Thank you.

Thank you for your testimony. Are there any others in the room that would like to add-on, please step to the microphone. Add-on in support, that is. State your name, organization and position.

Holly Fraumeni de Jesus with Lighthouse Public Affairs here in support of AB 1893 on behalf of SPUR, CivicWell, Sandhill properties, Buckeye Properties and the Inner-City Law center in United Way Greater Los Angeles.

Bob Naylor for Fieldstead and Company. That's Howard Ahmanson Junior, an Orange County philanthropist in strong support.

Audrey Ratajczak on behalf of the California Building Industry Association. We don't currently have a position, but we're continuing to work with the author and staff. Thank you.

Keith Coolidge on behalf of AARP California in support.

Brooke Pritchard on behalf of California YIMBY in strong support.

Tony Bui with the California Apartment Association in support.

Rafa Sonnenfeld on behalf of YIMBY Action and YIMBY Law. We don't currently have a position an are continuing to work with the author. Thank you.

And any? We do have a motion in a second. Any others in support? Seeing none. We will go to opposition is there opposition present in the room? Primary opposition. Please come forward. You have two minutes.

Good morning, Chair.

You can step.

Oh, I can step. Good morning, Chair and Members. Brady Guertin, on behalf of the League of California Cities, apologies, we didn't get a letter in, but the author's office is aware of our opposed unless amended position. We've had very productive conversations and look forward to continuing to have those conversations. Just a couple things that we wanted to point out.

So we appreciate the author and the Attorney General's desire to limit the application of Builder's Remedy projects by restricting where these projects can occur, limiting density, and allowing the use of objective development standards in some circumstances, however, we strongly believe less focus should be on what happens if a city does not adopt a housing element that substantially complies with the law. And more time and attention should be focused on how the state can partner with cities and ensure that all jurisdictions come into compliance.

We look forward to continuing to work with the author's office and appreciate those conversations and look forward to those conversations in the future. Thank you.

Thank you for your testimony. Any others in the room in opposition? Seeing none. We'll bring it back to the Committee and do we have questions? Assembly Member Lee.

I'd like to thank Assembly Member Wicks for bringing this Bill forward. I think it's on that important and meaningful changes to the Builder's Remedy is important, that we need these to happen.

But I would be remiss to say that there aren't some provisions that do give me some heartburn in this aspect. I think overall a lot of good provision here, but, you know, I don't love that there's a maximum density in here, because I do believe that if possible, we should achieve the maximum density as much as possible. But there also is no minimum density aspect.

And I know this is a product of many of our conversations and we'd like to be part of these conversations if possible, going forward. But I want to highlight for you that in the city I live in, City of San Jose, that I share representation with Assembly Member Kalra, is that when the city failed to be certified with its housing elements, a lot of developers took advantage of Builder's Remedy, but the opposite direction that we expect, they de-densified and they went downwards.

And something very notable, and this is many projects within the City of San Jose all at one time. One in my district, especially with the Berryessa BART station, literally right next to the BART station, they downsized and de-densified significantly, and in the end the city caved and gave them a lot of public benefit, which is very controversial as well. That gives us a lot of heartburn back home.

I mean, Builder's Remedy, I think a lot of people hoped would be a way that if a city was not being compliant, was being an obstructionist, that we could go in and deliver the housing establishment, especially in transit oriented places, to deliver it as maximum as possible.

But we saw that developers chose, perhaps business-wise, understandably under this current environment, that they chose to scale back but have big social, long-term consequences to our area that we have put a lot of effort into being as pro-housing as possible. So I just want to voice that I'll be supporting the Bill today. I'll continue to monitor the progress and want to be collaborative as much as possible and give you some backup on the minimum aspect of it.

Don't love a maximum, but I do think at least a minimum is necessary because we also don't want the instance in which they take advantage of Builder's Remedy and go the other direction too. And yes, of course, one house is better than zero houses, but especially in valuable land and transit corridors, if you lock in just a couple of houses there, that could be there for a long-term and we have a lot of consequences in northern San Jose.

So just want to voice those opinions, but I do want to be collaborative with you and I'll be supporting the Bill today.

Great. I appreciate that. We've had a lot of conversations about this. Happy to include you in all of those with our partners debating exactly this question around the minimum density. I share the same goals as you, and I'll say on the maximum density, it's still a very dense amount of housing that can go, particularly in the like, high resource communities, which I think is where we need it the most.

Assembly Member Kalra.

Thank you so much, and thank you, Assembly Member for bringing this forward. I support what you're trying to do here, and we've had similar conversations on the minimum density. I think that in some cases it's almost worse, you know, to have low density than nothing there because once it's there, it's there for generations, as evidenced by, well, downtown San Jose now that we're building high rises.

But there are three story, these three story housing that was built decades ago and they're going to be there for decades more. And I just think about the potential that's lost. And so especially if we're, there's going to be a reduction of affordability, then the concern is that the builders are going to do is low density luxury housing. And I'd much rather see it going the other direction of more affordability, higher density.

I don't have as much problem with the maximum density because I understand if you're, if you're taking that local control away in this one area, there's got to be some limit to it. I get it, I get that. But I also would encourage as much density as possible with a floor of density. Otherwise, we'll see what happened around the BART station and Berryessa.

So where people are going to pencil out and try to profit, whatever makes sense that day for them, that moment for them. Maybe in some moments it's higher density, maybe in many cases it's not. Especially the cost of construction. The more density increases, a lot of builders are just going to kind of get as much as they can with the lower density project and get out of town and then the city when the community is stuck with that density.

So, anyway, I appreciate, I know that we're on the same mindset on this, and so I look forward to your continued work on that component of it.

Yeah. And I'd be happy to pull together a conversation with some of the key stakeholders on this specific question with you all, especially because of your experience in San Jose. That'd be great.

Any other Members? Seeing none. There is a statement from the Chair of h\Housing. Housing element compliance is key to achieve our Committee's goals. Builders remedy is one of the hammers to get cities in compliance. Your Bill will strengthen the Builder's Remedy by providing certainty to developers and also provide guidance to local governments on how to process a development using builder's remedy. Thank you for agreeing to adjust the affordability required from 10% lower income to 10% very low-income. The recommendation is support with amends.

Amends should be taken Assembly Local Government. And with that we do have a motion from Assembly Member Reyes. A second from Assembly Member Quirk-Silva. Madam Secretary, please call the roll.

Motion do pass to the Assembly Committee and Local Government. [Roll call] We have five votes there.

The bill has five votes. We'll hold the roll open for absent Members. We will move to, I believe, Item Number Five: AB 2243. Is that correct? Yes. Assembly Member Wicks: AB 2243, Item Number Five. Please begin when you're ready.

Thank you. Hi team. Hi team. Okay. Thank you, Mr. Chair. I'm here to present AB 2243, a bill to clarify and expand AB 2011. First, I'd like to thank staff for slogging through this big bill, and happy to take your proposed amendments to fix an important typo. AB 2011, also known as the Affordable Housing and High Roads Job Act of 2022, was a bill I authored in 2022, which a couple of you were joint authors on.

It allows the development of multifamily infill housing and areas zoned for parking, retail, and office. In return for making these housing developments by-right, developers need to provide affordable housing on site and ensure that construction workers are paid the prevailing wage. Since the enactment of AB 2011, there have been substantial changes to the economy, including the collapse of demand for office space, the reduced demand for brick-and-mortar retail, and an increase in interest rates.

These changes have created both the demand and opportunity to open up sites where housing might be economically feasible. Additionally, since AB 2011's enactment, housing developers and local governments have identified aspects of the law's language that are subject and open to interpretation. This subjectivity has led to project delays and dissuaded utilization of the law. It has also led to inconsistent application across jurisdictions and created the potential for unnecessary lawsuits.

AB 2243 would address both of these issues by expanding AB 2011's geographic application and clarifying aspects of the law that are subject to interpretation. In terms of geographic expansion, AB 2243 would apply AB 2011 to the following types of projects.

One: the conversion of office-to-housing even if the site is not along a major commercial corridor, two: regional malls that exceed 20 acres in size, three: sites within 500 feet of freeways and 3,200 feet of oil extractions, as long as those projects are have required air filtration, and lastly, to existing high-rise districts, even if the site is not along a commercial corridor.

In terms of removing subjectivity, AB 2243 includes a series of clarifications, including, one: clarifying that all aspects of AB 2011 projects are ministerial and not subject to CEQA, two: clarifying how AB 2011 intersects with Density Bonus Law, and three: specifying that any site remediation needs to occur after project approval but before the site can be occupied.

Importantly, AB 2243 doesn't touch AB 2011's labor standards or affordable housing standards, which is why it's still supported by 2011's diverse coalition of construction, labor, SEIU, and CSEA, affordable and market rate developers, and other pro-housing organizations. AB 2011 has only been in law for 20 months.

During this period, high interest rates have dampened the housing construction market, and while the use of AB 2011 hasn't gotten gangbusters like we had wanted, we now have enough evidence from projects that are using 2011 or would like to to know some fixes are necessary to align the language of the bill with its intent.

My goal is that with this bill, the moment economic conditions improve, projects will be able to utilize AB 2011 as it was intended, which was to provide certainty to smart projects in return for affordability and high labor standards. And for those reasons, I will ask for an aye vote. With me here to testify is Ann Silverberg, CEO of Related Companies Northern California and Northwest Affordable Housing Division, and Mr. Danny Curtin, Director of the California Conference of Carpenters.

Thank you, Assembly Member. Two minutes each.

All right. Honorable Members of the Committee, my name is Ann Silverberg, and I am the CEO for Related's Northern California and Northwest Affordable Housing Divisions. In my role, I'm currently overseeing the production of 5,000 affordable housing units, and in our 30-year history, Related California has developed over 20,000 housing units.

I'm also a board member of the Housing Action Coalition, a sponsor of AB 2243. First and foremost, I'd like to express my extreme gratitude to the Assembly Housing Committee for your clear and constant commitment to combating our severe housing crisis. The laws related to streamlining and supporting the production of new housing units are making a meaningful difference as they are helping us deliver more housing more quickly. Specifically, the passage of the landmark bill, AB 2011, has been critical in expediting affordable housing developments.

I'll give you an example. From our portfolio, we're currently using AB 2011 on land zone for parking at a VTA light rail stop in Santa Clara County. The site will be quickly cleared for the development of 90 affordable housing units for low-income residents in a key location near amenities and services, and most importantly, near high-quality transit.

Using AB 2011, this development will be processed in a matter of months instead of years, and so I again want to thank you for your support for AB 2011. It is working. I'm speaking today in strong support of AB 2243, which amends AB 2011 to to provide helpful clarifications while also expanding its applicability to catalyze even more housing opportunities. These clarifications will improve the law as currently written to allow for additional sites to be developed for housing.

Sites that were previously ineligible for streamlining will now be feasible, and it will expand production potential throughout the state and especially including infill locations. Another example from our portfolio that we're working on currently, our firm is pursuing housing on an underutilized, two-parcel site zone for commercial in Alameda County. It's an active infill area and it's very promising for housing production. With the clarifications of AB 2243, this site will be eligible for streamlining, clearing the way for needed housing in this really key location. There are amenities--

And if you can work toward closing? Thank you.

Services, transit, and jobs. Thank you again for your visionary support. Thank you to Assembly Member Buffy Wicks, and I'm happy to answer any questions. Thank you.

Thank you so much. Two minutes.

Okay. Thank you very much. Watching the Committee is always enlightening. Thank you all for your hard work up here. Thank you, Assembly Member, for the incredible work you've done. I'm here basically just to reiterate our support for this measure. I want to thank Ann Silverberg for the specifics that she put out there. But here we are, déjà vu. If any of you remember Yogi Berra all over again; we've been here before.

I just want to say I brought a couple of floor alerts from two years ago, and they were great then and they're great now. UrbanFootprint, Calthorpe, EPS analysis: possibly 1.6 to 2.4 million homes, 300 to 400,000 lower income homes or lower cost homes. Housing costs are likely to be reduced. Fight climate change, because when you build in the commercial corridors, you bring down driving time, fewer greenhouse gases, et cetera. Grow state and local economies: this is fabulous.

You raise the value of the lands that you're developing, you get more income stream, you can invest that income stream in more housing. It was great. We also did some great stuff on, I would say a vigorous, or how would I put it, spirited labor debate on the issues in terms of labor. Came out great: prevailing wages, health care, and labor management enforcement of the program. So we're still there. It's all great.

We just got to get this bill out of jail, so to speak, fix the problems that are legitimate, that people are having trouble applying the law, expand it, and get back to work, and maybe we could start seeing this housing bust loose. So I just, again, build affordable housing, grow the economy, protect the construction workforce, build generational wealth for those construction workers. We're here to say, thank you again, and let's get this ball rolling.

Thank you to the witnesses for their testimony. Those in the room that would like to add on, name, organization, and position, please.

Good morning. Cassie Mancini, on behalf of the California School Employees Association, in support.

Bob Naylor for Fieldstead and Company, in support.

Mary Ellen Shay, California Association of Local Housing Finance Agencies and the California Housing Consortium. Strong support.

Good morning. Francisco Morales, here on behalf of the Housing Action Coalition, a co-sponsor of this measure, in strong support. Thank you.

Rafa Sonnenfeld with YIMBY Action, on behalf of our chapters in California East Bay YIMBY, Mountain View YIMBY, Northern Neighbors, Peninsula For Everyone, San Francisco YIMBY, Santa Cruz YIMBY, Santa Rosa YIMBY, SLOCo YIMBY, Urban Environmentalists, Grow the Richmond, Ventura County YIMBY, Streets For People, Southside Ford, How To ADU, People for Housing Orange County, Progress in LA Valley, South Bay YIMBY, and Napa-Solano For Everyone, in support. Thank you.

Leslie Rodriguez, on behalf of Housing Trust Silicon Valley, in strong support.

Tony Bui with the California Apartment Association, in strong support.

Good afternoon. James Thuerwachter with the California State Council of Laborers, in strong support.

Holly Fraumeni de Jesus with Lighthouse Public Affairs, on behalf of SPUR, CivicWell, Buckeye Properties, Sand Hill Properties, and the Inner City Law Center, in strong support.

Keith Coolidge, AARP California, in support.

Brooke Pritchard, on behalf of California YIMBY, in strong support.

Dan Branton, Drywall-Lathers Local 9109, in strong support.

Sam Chung, Local 46 Carpenter Union, support.

Curt Ferreira, Local 46, in support.

Antonio Acevedo, Carpenters Local 46, in support.

Matt Kelly, Carpenters Local 46, in strong support.

Neilan John Charles, Carpenters Local 46, in strong support.

April Atkins, Carpenter Local 22, strong support.

Richard Cruz, proud member of Carpenters Union, in strong support. Thank you.

Rod Finley, Drywall-Lathers 9109, in strong support.

Emilio Trevino, Local 46 Carpenter, in support.

Lindsey Sakacitz, Local 46 Carpenters, very strong support.

Luis Orozco, Carpenters Local 46, in strong support.

Ramon Amaral, Carpenters Local 152, strong support.

Alexander Hampton, Local 46, strong support.

Chris Martinez, Local 1599 in Shasta County, in strong support.

Sean Reese, Carpenters Local 1599, in strong support.

Surely there has to be one more in support.

There's about 200 outside.

Well, we haven't come back to Committee yet, so with that, we will go to opposition. Is there opposition in the room? Primary opposition, you have two minutes. Please. Two minutes.

Good morning again. Chair and Members, Brady Guertin, on behalf of the League of California Cities, in respectful opposition to the measure. We strongly believe that cities need the time and space to implement the dozens of new housing laws passed in recent years, and additionally, many cities are still actively working to update their required housing element.

Before making yet more changes to the law, lawmakers and the Governor should partner with cities to ensure that they have the necessary tools and technical assistance to develop housing plans that work in each unique community. We look forward to continuing to work with the author's office and appreciate the continued dialogue. Thank you.

Thank you for your testimony. Any others that would like to add on in opposition? Seeing none, we'll bring it back to the Committee. Questions or comments? Assembly Member Reyes.

Well, I want to begin by thanking the author for being a bold leader in this space, for being someone who has taken on this issue head on. You did that with 2011 and now with this bill, and it's clear that we're looking to expand sites for building a more affordable housing. This is exactly what we need. The one area that--and we've talked about it--is the sites that are 500 feet from freeways for low-income housing, for affordable housing.

And I know that we've had the conversation, something that you'll be working on, the air filtration, and to find other ways to protect those who are going to be so close to the freeways. We do have a responsibility to not just provide them housing, but housing that is safe, that is not going to harm them.

And I appreciate that. You know, when we, I mean, you all know we do these bills and we see them out in the wild, you know, and that's part of what I wanted to do here was--I think it's because I'm sort of like legislatively middle-aged where I'm starting to recognize, you know, the work I've done and how much longer I have and, you know, want to make sure that--but also that what we're doing is actually working.

And the only way you know that is when the bill gets passed, sign into law, and then you can see its impact. And so once we saw the impact, we realized there's whole communities that 2011 doesn't even apply to because of some of the setbacks, right? And so figuring out how do we expand the scope of the footprint, but I also hear you on the concern of ensuring that we're doing enough remediation so that those communities are also protected, for low and high-income communities both, right?

We wanna make sure that people have the ability to breathe clean air no matter where they live. So I'm happy to continue to work on that and figure out other creative ways to ensure that we have the remediation because I share the same values that you do in that space and figuring out sort of how do we make this decision on balance to, I think, accommodate both needs.

Thank you.

Any other Members? Questions or comments? Seeing none, there is a statement from the Chair of Assembly Housing: 'AB 2011 was a pivotal bill that opened up thousands of commercial sites across California for the potential development of millions of new homes. I'm glad to see Assembly Member Wicks bring this bill forward today, and I'm pleased that our staff is accepting our Committee amendments, which in the interest of timing will be taken in the Committee on Local Government.'

'AB 2243 will expand AB 2011's geographic applicability and clarify aspects of the law that are currently subject to local interpretation. We might even see some adaptive reuse projects come out of this bill, which I am particularly excited about.' So with that, the recommendation is support with amendments, and do we have a motion and a second? So I have a motion from Assembly Member Reyes; a second from Assembly Member Patterson. Madam Secretary, will you please call the roll?

Motion: 'do pass to the Assembly Committee on Local Government.' [Roll Call].

Bill's out.

Thank you. Thank you for that bipartisan support.

Okay, we have is the only Assemblymember Low? Any other? All right, so that's 2933.

Thank you very much Mister chair and colleagues, for allowing me to present Assembly Bill 2933. And first off, I'd like to thank the Committee staff for working with us and accepting the Committee amendments as outlined in analysis as well. This Bill helps to utilize technology on water conservation. With me today is Mark Oprea, also to speak in support.

Mister chair, Members of the Committee, Mark Oprea, I'm here on behalf of the supporters of this and I want to thank Assemblymember Low for authoring this measure. AB 2933 sets in motion a process that has the potential to annually save the State of California over 275,000 acre feet of water, enough water to supply household water needs for nearly 1.9 million Californians.

Malfunctioning water devices and plumbing leaks generate significant water losses throughout California, and finding leaks in multifamily properties is particularly difficult because of the high number of toilets and water devices. Toilets are the most significant generators of wasted water because they malfunction frequently, resulting in 300 gallons per day for slow leaks and over 2000 gallons per day for stuck valves per toilet. The most recent data available shows that in any given time, 5.5% of toilets malfunction, 3.6% in the stuck condition, and 1.9% in slow leak conditions.

Multifamily housing in California with 10 units or larger accounts for 17.1% of total residential inventory or an estimated 5.1 million toilets. A point of use leak detection device, which I'm holding in my hand, can be attached to a toilet and uses remote data gathering and real time analytics to detect water that's just going down the drain and identify the point of failure. Its purpose is to quickly and precisely locate faulty fixtures and plumbing leaks and alert the landlord so repairs can be made.

I want to just take a brief moment to address some of the comments in the late opposition letter, and first and foremost, we want to thank the Committee for their work on this Bill.

The Bill in its present form is the form in which the measure was recommended to us by the opponents, which is to leave it up to the Department of Housing and Community Development, the Building Standards Commission, to investigate, determine if these devices are efficacious and if to, and whether or not to ask that they be installed and what the timing of that is.

The second, the cost to property owners to install and maintain a point of view use water leak detection system is recaptured in less than a year. The average water savings of over 17,000 gallons per toilet will amount to a $307 annual cost savings per toilet. That's based upon the cost of water at less than two cent per gallon in Los Angeles as an example. Effectively, the property owner will generate a positive rate of return on their investment in less than a year.

So the positive fiscal impact is significant not only for the landlord, but for tenants as well. Again, I want to thank Assemblymember Low for introducing this measure, and we respectfully ask your aye vote.

Great, thank you. Any witnesses in support? Other witnesses seeing none. Any primary opposition to this measure?

Thank you. Any other opposition to this measure? All right. I wish people that oppose my bills would give me. We'll go to the committee, Mr. Grayson.

Thank you, Mr. Vice Chair. And I also want. I'll stand up. I'll give you a hug after we're done. I'm not an opposite. I will be supporting the bill today. However, I do want to make some comments, and if I understand it correctly, it's more about studying and finding out if the devices are, are worth putting on. So I do appreciate that. I'm so glad you used an example that you did.

And by the way, I have the highest regard for both the sponsor and my dear friend who is the author. I'm glad you used the example that you did about a toilet in particular, because it's hard not to detect a leak, a leaking toilet, because if it's the tank, then it's going to go through its cycle. If there's a leak, it's going to go through its cycle. You're going to know. So if you're not fixing it, you're knowingly not fixing it.

It's not because you didn't know there wasn't a leak. If it's a tankless, you're still going to know because there's going to be flow into the actual bowl that you will actually visibly be able to see. Even if it's a small leak, you'll be able to see that. So if it's my understanding that these devices may cost around $250 or somewhere around there to put on, this is not just a device for the home, it's a device for the fixture.

Some jurisdictions actually have a fee on top of the permit fee. You pay for a permit fee to build a home, but then you pay on top of the permit fee, what's called a trap fee. So every single trap in the structure gets an additional fee put onto the actual permit fee to build a structure. In some cases, that trap fee can be as high as $750 per trap.

So every single fixture you have in that house is a $750 fee if it has a trap to it. So that is an addition. So dollar 250 doesn't sound like a lot until you start counting all the fixtures, and in some fixtures, you don't have one water line. You actually have two water lines that are going to it, a hot and a cold. So now you got to buy two of them for one sink. And so the cost does add up.

A single cost of that's not bad, but the cost does add up. Now, if there are leaks, we should know about it. In California, one of the greatest things we should hold precious is our water, and we need to make sure that we address this. So this is why I'm supporting it today is because it's definitely something that we should be concerned with when it comes to wasting water and just sending it down the drain unused.

However, at the same time, I think it's very prudent of us to be mindful of the fact that this is impacting the cost of housing in some way, shape or form. So with that, I'll be supporting the bill today. Thank you for turning into something that we can actually look at and study and see what we can do to make sure we conserve water and still protect, or at least control cost of housing at the same time. Thank you very much.

Ms. Reyes.

I would align my comments with my colleague. The other issue that I saw was the multi unit residential structure is identified as two or more units. And so when we're looking at the cost for a multi unit residential structure, the cost that you've just described, that has just been described is going to be multiplied a number of times, even for small units of two, of just two units.

It's something that clearly we need to support because we need to conserve water and find those leaks and fix them as quickly as possible. And I think the tenants and the, the owners alike are going to want to take care of that. But the fact that it is for as little as two units is of concern.

Would you like to respond to that or?

Sure. But both Member Grayson and Ms. Reyes, to acknowledge the cost prohibitive nature to be a factor of consideration and being sensitive to that, should this bill move forward, too. I know that we work with the committee staff as well, too, on the numbers specifically, and that also was suggested from a Committee as well. So should this move forward?

The commitment in acknowledging the cost inherently and while also getting to the goal at hand of conservation and utilizing technology.

Great. Thank you. Any other comments? Question, does this just a little clarification on the committee amendments? I think the bill is, is originally written, would require them to propose changes, and I'm not really exactly sure if that process would be through the regulatory process. Or through us. A, is that still in there? And B, if it is still in there. Exactly what does that mean?

To propose through the regulatory process or through their normal update process? Through the legislative process?

Yes. And apologies if I did not clarify accepting the committee amendments as noted as well too. And Mister Praya through the chair to also address Mr. Patterson.

Yeah, Mister Patterson, the committee consultant correctly recommended that the bill be amended so that this is a matter that is brought to the attention of the Department of Housing and Community Development for them to examine this technology, the nature of the problem, to look at these kinds of devices as well as other matters, and to make a determination as to what to recommend and its timing.

Thank you. Well, with that, do we have a motion?

So move second.

All right. Mr. Low and Mr. Grayson.

Motion do pass to the Assembly.

Would you like to close?

Just also acknowledging that this committee did pass Senate Bill 745, Desi Bill dealing with Greywater as well in similarity and I respectfully for your aye vote.

All right. Thank you Mr. Low. And now we can take roll.

Motion to pass to the Assembly Committee Environmental Safety and Toxic Materials. [Roll Call]

[Roll Call]

Okay, great. Okay, well, there we go. Mr. Low, your b ill is out, but we'll leave the roll open. Thank you. Any other authors? It. This is AB 3116 and you can start whenever you're ready.

Thank you very much, Mr. Chair and colleagues. AB 3116 deals with the issue of student housing. I'm going to just allow our witnesses to give their testimony to the point, concise and to the point, and have deliberation with you all. Thank you for the committee analysis. We'll be accepting the amendments and respectfully ask for your aye vote.

We have a motion and a second. And we have two witnesses. Two minutes each, please. Thank you.

Good morning, Mr. chair and assembly members. My name is Matt Aini. I'm a junior at UC Berkeley and a co chair of the Student Homes Coalition. The Student Homes Coalition represents a myriad of student and youth led organizations spreading across the State of California, all committed to advancing policies which expand housing opportunities for maximizing educational success. As a proud sponsor of this. As a proud sponsor of this bill, student Homes strongly urges the passage of AB 3116 out of committee today.

It's not news to you all that in recent years, the cost of housing for college students has become a growing concern. But with the substantial and longstanding gap between on campus housing beds and student enrollment at California's college campuses. There's both a nexus and a critical need for housing policy to address the student housing crisis.

When it comes to off campus housing, this was the impetus for the initial student housing density bonus, which I'll refer to hereafter as SHCB and is a catalyst behind AB 3116's changes to make this program work. With the incorporation of amendments laid out in the bill analysis, this bill will make important technical corrections to enhance the usability of the SHDB, as well as bring the SHDB into the density bonus formula, which has been built up over the past several years.

AB 3116 acknowledges the limitations of the SHDB, which have resulted in its current total of zero student beds produced since the initial laws inception in 2018, and by enabling student housing developers to verify student eligibility for units with method other than university master release, SHDB projects no longer require university admin support in order to operate. Moreover, by removing parking minimums for SHDB eligible projects, we can ensure that students do not have to bear the burden of funding parking that would go unused.

Finally, it's worth acknowledging that this bill is being heard under a budget climate where previously committed funding for student housing has been pared back, further elevating the need for additional state action on this very important issue. Thank you and I respectfully ask for an aye vote.

Perfect. Thank you. Next witness.

Good morning and thank you for hearing from me today. My name is Joshua Smith and I'm a transfer student at UC Davis and I'm here to speak before this committee in support of AB 3116. As vice chair of UC Davis Institute Student Housing and Transportation Advocacy Committee, I understand there are many factors to consider when finding solutions and resources for students seeking housing on and off campus. However, for many students I interact with, housing insecurity begins with a lack of choices.

While my home institution, UC Davis, guarantees on campus housing for transfer students like me, for my fellow students at Davis without on campus housing guarantees, the housing hunt in the spring is a much different story. Classmates, acquaintances, and friends of mine often solicit and submit several apartment applications simultaneously across the city, hoping there's a fallback on, you know, on an apartment if they don't get on campus apartments. Some students at Davis work through as many over 10 rental applications before getting an offer accepted.

As a result, it's not uncommon for students to find themselves stuck on multiple housing waitlists, both for off campus and even on campus. And that's for university housing, and it's actually adding undue pressure onto students as they're just trying to access a higher education during a period of life when students should be able to focus on learning and self growth.

Too many of us have to worry about the potential of considering how much more we have to pay to settle for worse housing conditions than where we live right now. On university housing. The more that I and my peers have to focus on housing, the worse it is for our educational experience. I can attest to that. The tighter one's budget is, the more acute this kind of problem becomes in the wake of this current situation. What students need to.

What students need at the moment is more affordable and abundant housing options. AB 3116 strives towards this goal and enabling the creation of more student housing beds and providing a path to create below market rate, off campus housing for a future where students can place less, focus on affording a place to live, and focus more on becoming students. I strongly urge you to vote in favor of AB 3116. Thank you.

Thank you very much. Any other witnesses in support, please state your name and affiliation.

Rafa Sonnenfeld with YIMBY Action, in support.

Great, thank you.

Seamus Garrity with Lighthouse Public Affairs on behalf of Power California and the San Diego Housing Commission, in support.

Francisco Morales here on behalf of the Housing Action Coalition, in support.

Thank you. Thank you very much. Any primary witnesses in opposition? Anybody else in opposition? All right, seeing none, bring it back to the committee. Mr. Kalra.

Thank you. Thank you, Senator Garcia, for bringing this forward. I represent San Jose and San Jose State University, which at least the most recent numbers I saw, has the highest rate of homelessness of any CSU campus amongst the students, and student and homeless shouldn't be in the same phrase, in the same sentence.

And so we know how challenging it is in every corner of the state, but in particular in some of our urban areas where it's hard enough, you're earning a good salary to be able to afford to live there, let alone if you're a student. The campus, like many college campuses, is getting really creative in trying to find housing for students. They just leased a big annex of our Fairmont Hotel, or used to be our Fairmont hotel in downtown, converting it to student housing.

And so those are the examples of the creativity kind of forced by the urgency of the situation. So I'm hoping this legislation will further allow for greater creative flexibility, flexibility and flexibility for campuses to do everything they can to make sure every student has good quality housing so they can focus on their studies. Thank you.

Thank you very much, Ms. Reyes.

Thank you. Thank you to the author for bringing this. I know for San Bernardino Community College District. They are building some student housing. But as noted in the analysis, so many, so few of our community colleges have housing for our students. This is much needed. And I sincerely appreciate the testimony of the students, because, quite frankly, it is your voice that needs to be heard as to why this is important.

You have the experience personally, plus through your organizations on your campuses, to be able to share with us how important this need is. So with that, I would move the bill, if it hasn't already been moved.

All right, motion Ms. Reyes. And second, Mr. Lee.

And I'd also like to be added on as a co author, if you will accept that.

Of course.

Any other comments from the committee? All right, seeing none, you can close.

Thank you so much. Again, I want to just really say how much we appreciate the chair and his team, Lisa, particularly in working with us, working with the sponsors of the bill. This is an initiative that has been driven by the students and for the students. And so we're very grateful to be able to work with them and bring this issue before you all today. Respectfully ask for your aye vote.

Thank you very much. We can take a roll.

Motion do pass to the Assembly Committee and Local Government. [Roll Call]

All right, eight to zero, the bill out. Thank you.

Thank you. Thank you.

Just a quick announcement I think for those listening on TV was nice earlier. I'm getting less patient. We have four authors remaining that need to come down here to be able to present their Bill. Mister Santiago, Mister Haney, Mister Gabriel, and Miss Carrillo, you know that an option is that another Member can present your Bill. We all have places to be and Members are sitting here on this dais waiting for you to present your bills. So please do so.

And if this really stretches on further, then we may actually have to call today and let us all go on to our business. So thank you very much. It. Thank you Mister Haney. Thank you Mister Haney. Appreciate your being here to present item number 19. AB 3068. When you are ready, you may begin your presentation.

Thank you Mister Chair and Members, I want to start by accepting the Committee's amendment amendments today, and I also want to thank the Committee staff for their thoughtful and detailed feedback on the Bill. I think it made it much clearer and stronger and really appreciate the work that was done on it.

AB 3068 is the office to Housing Conversion act, and it is a direct response to the crisis of California's empty downtown business districts and the need to convert underutilized office buildings within prime locations to new housing. Downtowns are struggling as our work culture shifted toward remote and hybrid work policies. With fewer employees working full time in the office, commercial buildings in downtowns across the state are experiencing high rates of vacancy. This shift has left downtowns in trouble and in desperate need of catalytic and innovative transformations.

This will create livable neighborhoods in our commercial districts and help meet our desperate need for more housing. While downtowns are currently facing the devastating effects of empty office buildings and slow economic recovery, we don't need to subscribe to the idea of the urban doom loop. There are ways that we can address this issue now. A study from UC Berkeley showed that cities that don't include housing in their downtowns experience significantly slower recovery from economic crises in downtowns that prioritize livability.

And while there is certainly a need for housing in our downtowns, we also have to provide some flexibility for creative mixed use projects, which is important when we are reimagining what cities should look like post COVID-19 pandemic. AB 3068 will accelerate office to housing conversion projects by creating a pathway for by right ministerial approval of office conversion projects, ensuring more predictability and fewer barriers to an already difficult building process.

It will also provide flexibility to ensure that historic buildings are more economically feasible for conversion, meaning we can preserve our buildings for housing while making sure that downtown's diverse and unique characteristics are kept intact. With me in support today are Rafa Sonnenfeld from YIMBY Action and Cindy Heitzman from the California Preservation Foundation. Thank you. Welcome.

Good morning, Chair, Members. Thank you for taking up this important issue. Rafa Sonnenfeld with YIMBY Action. YIMBY Action in our chapters fight for better housing policies because we want to reduce poverty and homelessness, eliminate racial segregation, create jobs, and stop climate change. California faces a severe housing shortage at all income levels. At the same time, California is in the midst of a generational shift in work culture.

Companies are shifting to hybrid work models with fees fewer employees working full time in the office, with vacancy rates hitting record highs with over 35% vacancy in downtown San Francisco and nearly 30% in Greater Los Angeles in 2023. Converting vacant commercial space into residential housing through adaptive reuse can greatly reduce underutilized and vacant buildings that have been decreasing in value, thereby helping to stabilize the commercial real estate market and filling these spaces with more valuable tax generating uses.

Adaptive reuse projects can also increase activity and foot traffic in neighborhoods across the state, which help support local businesses and enhance the cultural life of cities and towns. Unfortunately, local discretionary approval processes and environmental reviews for housing can cause years long delays, increase risk to developments, making housing projects infeasible, and contribute to the challenging challenges in resolving the state's housing shortage. AB 3068 the Office Towson Conversion Act provides a streamlined ministerial approval process for adaptive reuse of existing buildings into residential uses in all zones.

The act facilitates the the conversion of underutilized space in offices, 10 seconds, and other commercial and industrial uses if at least 50% of the converted space is used for residential use. There's also an incentive for property tax rebate incentive programs to encourage adapt every use project. Thank you. I'm available for any questions. Thank you very much.

Thank you. Good morning, Chairman Ward and Committee Members, and staff. I'm Cindy Heitzman, the Executive Director at the California Preservation Foundation, an organization committed to protecting California's rich historic and cultural heritage through advocacy and education. Today, I seek your support of AB 3068. What sets AB 3068 apart is a streamlined review of historic resources, promoting conversion of commercial spaces into housing while preserving those portions or features of buildings that convey its historic, cultural, or architectural values.

This is important because much of our older building stock are likely candidates for adaptive reuse. The review process considers factors like the age of the building, its landmark status, and utilization of federal or state historic tax credits. Furthermore, it mandates compliance with the secretary of the Interior standards for the treatment of historic properties, ensuring that preservation standards are met. We've seen numerous success stories across California of adaptive reuse, from offices, hospitals, factories and even funeral homes into housing.

Notably, the City of Los Angeles Adaptive Reuse Ordinance, adopted in 1999, has revitalized its historic core and has generated over 12,000 units of housing since its adoption. In Sacramento, buildings like Globe Mills, a former flour mill, now serves as senior housing, while the Capitol Park Hotel, one block from this building, has been transformed into transitional housing for the homeless. AB 3068 is a catalyst for economic revitalization, alleviating housing shortages and safeguarding the character of our historic downtowns.

But this isn't merely a housing Bill. It is a blueprint for sustainable development. Harmonizing economic growth with historic preservation, shaping a vibrant future while honoring our past 10 seconds. I thank you for your time and request your support of AB 3068.

Thank you. Any other Members of the public wish to register support. Thank you for lining up.

Bob Naylor for Fieldstead and Company in support. Thank you.

Shane Escardy with Lighthouse Public Affairs on behalf of Spur-Buckeye Properties, and Sandhill Properties in support. Thank you.

Mark Knezevich on behalf of Streets For All in support, thank you.

Rebecca Marcus representing Leadingage California in support.

Leslie Rodriguez on behalf of Housing Trust Silicon Valley in support.

Skylar Wonnacott on behalf of the California Business Properties Association in strong support.

Brooke Pritchard on behalf of California YIMBY in support.

Francisco Morales on behalf of the Housing Action Coalition in support

Mister Chair, Members Randall Hart on behalf of the AIDS Healthcare Foundation and its Healthy Housing Foundation. This is a great Bill. Please support. Thank you.

Thank you. Are there any Members of the public here in opposition either for testimony or willing to interested in stating on the record. Seeing none, we'll turn it back to Member comments Ms. Quirk-Silva.

This is a great Bill and what's actually special about it is that the preservation groups are joining in support. As we know sometimes you don't. And so we appreciate that. But I like it so much I'd like to be at it as a joint author. It's the right Bill for the right time as we know. Just looking around this vicinity we see so many of our state buildings that are vacant and including other office buildings.

We also take in account that businesses may not necessarily be going backwards in the sense of recalling everybody back to work. There may be continue with the hybrid model which I think is very family friendly and so forth. So the question is what do we do with these vacant offices? And this is the solution is to readapt them to housing that we so much need with some of the guardrails that I think are important to communities. Great Bill and I fully support it.

Thank you Mister Kalra. Thank you Mister Chair. Also I want to thank the author for this Bill and wish him a happy birthday. And I hope all eight of his bills he's presenting in various committees find success. Thank you.

Thank you. Any other Members wishing to comment? Mister Haney, thank you so much for working on this issue. I think there was a lot of certainly one your own personal passion to be able to be helpful in this space. We know many of our downtown areas, many of our historic properties are in need of creative solutions and your Bill goes right to the heart to be able to address that. I also want to wish you a happy birthday and I invite you to close on this measure.

Thank you. Thank you so much and appreciate the kind words and the well wishes. I do want to acknowledge as my colleague did, that it is incredibly special to have the coalition that we have on this. Having both YIMBY Action and California Preservation foundation together is a very big deal. And I think the benefit of this will flow to the people of California. And with that, I want to thank you and respectfully ask for your aye vote thank you.

So Member, just for note, the amendments will be taken in the Assembly Local Government Committee. Madam Secretary, please call the roll.

Motion to pass to the Assembly Committee on Local Government. [Roll Call]

That measure has six votes. It is out. We'll hold the roll of imperfect Members. Thank you. Next, Mister Gabriel, we'll take file item number 22. This is AB 3160 and when you are ready with your presenters, you may begin.

Thank you very much Mister Chair and colleagues. I am pleased today to present AB 3160, which will preserve 500 million in enhanced state housing tax credits, helping to build thousands of new affordable units each year. In 2019, California began issuing enhanced state housing credits to help address financing gaps associated with affordable housing development and better leverage matching funding.

California's enhanced housing credits have helped build tens of thousands of affordable homes for low, very low, and extremely low-income households. Additionally, these credits have enabled California to draw down billions in federal housing credits, leveraging existing federal, local and private funding at a ratio greater than five to one.

Demand for these enhanced credits has also been dramatically oversubscribed since their creation. AB 3160 will ensure that the 500 million in enhanced credits continue to be available, providing affordable housing developers with essential certainty as they plan to build the homes our state desperately needs.

The California Housing Partnership project create these credits will help to create thousands of units of desperately needed affordable housing. This Bill is supported by a broad coalition of housing organizations and has no known opposition. With me today to testify in support of the Bill is Mark Stivers, the Director of Advocacy at the California Housing Partnership. Thank you. And respectfully request your aye vote thank you

Thank you, Mark Stivers. And just to put some specifics to the comments of Mister Gabriel, is that in the past four years, these credits have produced over 25,000 new affordable homes, leveraged $5.3 billion in federal tax credits that otherwise would have gone, we would have left on the table, and have also leveraged billions in private investment. And today we have 46,000 affordable homes that are permitted, entitled by local governments.

They are shovel ready to build, but for financing. And these tax credits fit, fill that final gap and allow us to start construction on a good number of those units. I just want to make three other observations. One is that this program has always had very strong bipartisan support, both at the state and the federal level. Two is just about all other tax credits in state law are permanent. This is one of the very few exceptions to that rule.

And we have to go through the budget process every single year to see if these credits are going to be available. And of course, the development timeline. It takes multiple years to put a development together, which creates a big level of uncertainty for our partners. And then lastly, I just want to clarify that this Bill actually has zero impact on this year's budget. These credits are claimed two to six years from now.

If awarded in 2025, the developers would start claiming them when construction is complete two years later and the credits are divided over a four year period. This has no impact on the current budget debate. So thank you for your support. We're very thankful to our budget chair for introducing this measure, and we look for your support. Thank you.

Bill has a motion and a second. Members of the public wishing to register support. Please state your name, organization and your position.

Natalie Spievack, on behalf of Housing California and the California Housing Consortium in strong support. Thank you.

Mary Ellen Shay, California Association of Local Housing Finance Agencies in support.

Galen Dobbins with the California Coalition for Rural Housing strong support.

Rebecca Marcus on behalf of Leadingage California in support.

Seamus Garrity with Lighthouse Public Affairs on behalf of Eden Housing support.

Good afternoon, Chair and Members. Andres Amida is on behalf of the nonprofit Housing Association of Northern California in strong support

Thank you all. Are there anybody. Is there anybody here who is wishing to speak in opposition, either through testimony or seating position? Seeing none, we'll turn it back to Members of the Committee. Any questions or comments? Seeing none, we have a motion in a second, and I'll just take the privilege of, you know, thanking our Budget Chair for prioritizing this is.

I had a chance to really reconcile some of the early proposals that we've seen in January with those that are producing affordable housing in our districts. The honing in on the low-income housing tax credit, you know, was crystal clear to me, and this is one that we must make sure is still on the table. It helps to leverage other opportunities as well, and it actually makes things pencil out on the back end. So it's critical that we preserve this in perpetuity. If you'll have me, I'd love to be able to be added as a principal co-author. With that, I advise you to close.

I'd be delighted and honored to add you, and I don't think I could have said it better myself. So I will use your comments as my close and respectfully request an aye vote.

Thank you, Madam Secretary. Please call the roll.

Motion do pass to the Assembly Committee on Revenue and Tax. [Roll Call]

That measure has five votes. It will be out and we'll hold the roll open for absent Members. Thank you very much. Mister Santiago, we've got two bills of yours in our Committee today. I'll leave it to your choice which you'd like to present. First 2667 if it would please the Committee. Great. This is item number 11. Mister Santiago, when you're ready, you may begin. Sure. In the interest of time, I will be brief for the Committee.

First, want to thank the chair and the Committee staff for their work on this Bill. Very plain and simple. This Bill would strengthen California's affirmatively furthering fair housing laws by providing stakeholders more tools to ensure local governments are taking meaningful action to further fair housing laws. Mister Chair, if you're okay with it, I'll hand over to the witnesses. That'd be great. Welcome.

Thank you. Honorable Chair in Members Amy Hindsheik, representing Abundant Housing LA. California has a long way to go in fulfilling the promise of the federal Fair Housing act passed over 50 years ago. And where the term affirmatively furthering fair housing, or AFFH, originally appeared, historic patterns of segregation persist and many people of color live in neighborhoods with severe environmental health burdens. And lack of access to necessities such as reliable public transportation.

Since the enactment of AB 686 and AB 1304, local governments across the state have developed a myriad of new housing programs. However, analysis of the proposed programs suggests that most of them will likely have minimal impact. Proposed programs often have had long or unclear timelines, vague objectives, and in many cases represent minimal commitments to staff, time, or resources. Many proposed AFFH programs do not focus on the land use and zoning policy, policy changes that would make progress toward the spirit of the fair housing law.

Most cities identify potential sites for low-income housing in their less affluent neighborhoods near existing multifamily zones, thus exacerbating the status quo of segregation rather than facilitating integration. The way in which local programs present their AFFH programs and housing plans is also inconsistent and incomplete, making evaluation of potential impact challenging.

AB 2667 would address these issues and advance fair housing by requiring the Department of Housing and Community Development to develop a standardized reporting format for AFFH programs and actions, and requiring local governments to make a draft inventory of sites available to HCD in the public at least 90 days prior to the adoption of its housing element. Thank you very much, Mister Santiago, for your leadership on this issue, and we respectfully request an aye vote, thank you.

Good morning, Honorable Chair, Members. My name is Mahdi Manji and I'm with Inner City Law Center. We're the only pro-Bono legal services provider based in Skid Row in Los Angeles. Skid Row is a community formed from government containment policy to exclude poor people from the rest of the City of Los Angeles. But every day, people from Skid row and low-income communities throughout California commute long distances to jobs in wealthier communities.

Wealthy communities require low-income workers to thrive, but often fail to adequately plan for housing low-income workers, forcing our clients to endure long commutes which deprives our clients of their quality time to spend with their children, their families, and their friends.

Thank you very much for the testimony. Are there any members of the public here that also wish to register support?

Rafa Sonnenfeld with YIMBY Action in support.

Francisco Morales on behalf of the Housing Action Coalition support. Thank you.

Is there anybody here wishing to express opposition to the Bill, either through testimony or by registering their opposition? Seeing none, we'll turn back to Members of the Committee and I think we have no questions or comments on this Bill. Ma'am, do we have a motion or a second yet? I entertain a motion by Miss Quirk-Silva. I heard a second by Miss Wilson. Assemblymember Santiago.

Thank you very much for your deep concern for making sure that we are doing all we can to support California's fair housing laws. I think this Bill is going to strike a very good balance between compliance and making it a little easier for some local governments in the future to make sure that we have good sites identified earlier in the drafting process. Critical role to support Bill can play with that. Would you like to close? I'll take that as my closing. Thank you very much, Madam Secretary. Please call the roll.

Motion to pass to the Assembly Committee and Local Government. [Roll Call]

That Bill currently has a six to one vote. It will be out and will hold the roll open for absent Members. And next you have item number 16. This is AB 2910. When your presenters are situated, you may begin.

Yeah, thank you Mister Chairman. I'll start by the time they get here. Sure, yeah. Thank you. I want to thank the Chair and the Committee staff and accept all the Committee amendments. Needless to say, downtowns have changed post-COVID.

We believe this is a straightforward Bill that would give cities the flexibility and nuances that needed to amend their local building codes and better enable adaptive use projects while ensuring the State of California has the appropriate level of oversight and discretion. The Committee amendments speak for themselves, allowing cities with a population of 400 or more to be able to use these tools, and the Committee's respecting the Committee's time and workload. Today I'll end my presentation and hand it over to our witnesses. Thank you, Mister Chair.

Good morning. Almost afternoon. I'm Nella McOsker, CEO of Central City Association, or CCA, to explain our organization a bit. We represent 300 businesses, institutions and nonprofits who are committed to enhancing downtown Los Angeles vibrancy and increasing opportunity across the Southern California region. We're strong advocates of policies that support adaptive reuse, and we're proud to sponsor AB 2910.

CCA spearheaded the City of LA's adaptive reuse ordinance back in 1999 that catalyzed the conversion of commercial buildings to about 12,000 units of housing and really transformed downtown Los Angeles into a 24/7 mixed use urban hub. Today, amid historic levels of office vacancies, we are again looking to adaptive reuse to help address some of our biggest challenges around housing, climate and our economy. What we're seeing is day to day office occupancy is about 50%.

The few office buildings in downtown LA that have sold recently went for below half of their prior value levels, not seen since the early two thousands. And this will soon have a serious impact on property tax revenues and our government's ability to pay for basic services. Deteriorating downtowns across the state. Amid our great housing needs, we want to take steps to convert these buildings to housing.

In the City of LA alone, we conservatively estimate that if just five to 10% of the city's office space was converted, it would yield 8,000 to 16,000 new units. The greenest buildings we know are existing ones. Reusing these buildings means preserving their carbon and cutting down emissions. The problem is that cities like ours are currently limited by the state and how we can interpret building codes for or conversions.

And so this is holding back cities like Los Angeles that have smart, broadly supported approaches to amend their codes to unlock more adaptive reuse projects. AB 2910 would allow larger cities with adaptive reuse policies to adopt alternative building regulations to facilitate these conversions. After, of course, review and approval by state agencies. We want to create this process for nuance needed local building codes to foster adaptive reuse.

10 seconds.

And we would. This is a crucial tool to make progress on this issue, and I ask respectfully for your aye vote.

Thank you very much. Other members of the public in support of the Bill?

Skylar Wonnacott with California Business Properties Association and Boma California in strong support. Thank you. Thank you.

Good afternoon, Chair and Members. Brady Guertin, on behalf of the League of California Cities in support. Thank you. Thank you.

Rafa Sonnenfeld with YIMBY Action. We currently have a support, if amended position. Look forward to working with the author on this important legislation. Thank you. Thank you.

Francisco Morales here on behalf of Housing Action Coalition in support.

Thank you very much. Are there any Members of the public here in opposition through testimony or just to state your position of opposition? Seeing none, turn back to Members of the Committee. Second motion by Miss Quirk-Silva, second by Mister Lee, seeing nobody else wish to be recognize. I just wanted to comment to Santiago, thank you for what I think is incredibly creative and important, potentially important Bill. When you had some early conversation with me around this, I kind of had sort of two thoughts in mind.

One, I think, like you, we recognize that we've got an important mission right now through our building standards Commission to be able to update them through free use legislation. The code section regarding adaptive use that is now underway. That will happen. It might not happen for several years time, but meanwhile we have a lot of need back in our home communities. And what can we do about that? Right?

Because the urgency is now and the idea that we've got excellent municipal staff that maybe can pull together the opportunity to be able to look at, you know, very much the same outcomes is good because that could get enacted faster and could be able to help facilitate many of the projects that you want to see. But more importantly, that local discussion for some of these larger cities can actually inform the work that we're doing up here at the state. So this really could actually be a pilot program for how we actually are working on a lot of other code sections. And I like your creativity in mind. With that, I invite you to close.

That will be my closing. And respectfully, ask an aye vote.

Thank you, Assemblymember. Madam Secretary, please call the roll.

Motion is do pass to the Committee on the and the Assembly do pass to the Committee Assembly and Local Government [Roll Call].

7-0 that Bill will be out and we'll hold it open for absent Members. Thank you, Mister. Thank you, Senate Member. Okay, I think at this time we will go ahead and open up the roll for absent Members. And we do have one Bill remaining on file. And I'm starting a five minute clock. I need an author or a Bill folder to present in the room within five minutes. Please open the roll and the consent calendar.

That consent calendar is out. Oh, I'm sorry. Nine to zero. Nine to zero, that's right.

We have everyone on number one. Item number 2, 1893. [Roll Call] Seven to zero, with two Members not voting, that Bill is out. Item number three [Roll Call].