Housing (Affordable Housing)

Existing law establishes various programs and regulations to assist with affordability and cost of living issues, such as the Multifamily Housing Program, the California Dream for All Program, and the CalWORKs Housing Support Program. This bill would state the intent of the Legislature to enact legislation to address affordability and cost of living in California.

Existing law requires the Department of Housing and Community Development, in consultation with each council of governments, to determine each region's existing and projected housing need, as provided. Existing law requires each council of governments, or delegate subregion as applicable, to develop and adopt a methodology for distributing the existing and projected regional housing need to cities, counties, and cities and counties within the region or within the subregion, as provided. Existing law also requires each council of governments and delegate subregion, as applicable, to adopt a final allocation of regional housing needs to each local government in the region or subregion, where applicable, and the department, based on that adopted methodology. Existing law requires that the housing element of a county's or city's general plan include, among other things, a quantification of the locality's existing and projected housing needs for all income levels, which must include the locality's share of the regional housing need, as provided. Existing law authorizes a local government within the same county as a federally recognized Native American tribe to enter into a voluntary agreement with a tribe to allow new tribal housing development projects to count toward the locality's share of the regional housing needs allocation if certain conditions are met. This bill would authorize a local government, as defined, to enter into a voluntary agreement with another local government to allow new housing development projects to count toward each locality's share of the regional housing needs allocation if certain conditions are met, including that the project includes affordable housing units for very low and lower income households.

Existing property tax law, pursuant to constitutional authorization, provides for a "welfare exemption" for property used exclusively for religious, hospital, scientific, or charitable purposes and that is owned or operated by certain types of nonprofit entities, if certain qualifying criteria are met. Existing law also provides that property is within the welfare exemption if that property is owned by a community land trust, as defined, otherwise qualifying for the welfare exemption, and specified conditions are met, including that the property is being or will be developed or rehabilitated as housing, as specified. This bill would make a nonsubstantive change to the provision providing that property is within the welfare exemption if that property is owned by a community land trust.

The California Environmental Quality Act (CEQA) requires a lead agency, as defined, to prepare, or cause to be prepared, and certify the completion of an environmental impact report on a project that it proposes to carry out or approve that may have a significant effect on the environment or to adopt a negative declaration if it finds that the project will not have that effect. CEQA also requires a lead agency to prepare a mitigated negative declaration for a project that may have a significant effect on the environment if revisions in the project would avoid or mitigate that effect and there is no substantial evidence that the project, as revised, would have a significant effect on the environment. If a lead agency determines that a project will have a significant transportation impact, existing law authorizes the lead agency to mitigate the transportation impact to a less than significant level by helping to fund or otherwise facilitating housing or related infrastructure projects, including by contributing an amount, to be determined pursuant to guidance issued by the Office of Land Use and Climate Innovation, to the Transit-Oriented Development Implementation Fund for purposes of the Transit-Oriented Development Implementation Program. Existing law makes those moneys available to the Department of Housing and Community Development, upon appropriation by the Legislature, for the purpose of awarding funding for affordable housing or related infrastructure projects under the program in accordance with specified priorities. On or before July 1, 2026, and at least once every 3 years thereafter, existing law requires the office, in consultation with other state agencies, to issue guidance related to the implementation of these provisions, as provided. This bill would authorize a lead agency for a land use project to require an applicant to contribute to the Transit-Oriented Development Implementation Fund if certain cost conditions are met and the department and the office have validated the reductions in vehicle miles traveled that are attributable to the project, as specified. This bill would declare that it is to take effect immediately as an urgency statute.

Existing law establishes the California Housing Finance Agency in the Business, Consumer Services, and Housing Agency, and, as of July 1, 2026, transfers the agency to the California Housing and Homelessness Agency created pursuant to the Governor's Reorganization Plan No. 1 of 2025, as provided. Existing law authorizes the agency to, among other things, make loans to finance affordable housing, including residential structures, housing developments, multifamily rental housing, special needs housing, and other forms of housing, as specified. Existing law establishes the California Dream for All Program, administered by the agency subject to the availability of funds, to provide shared appreciation loans, as defined, to qualified first-time homebuyers. Existing law limits the program to providing assistance to low- and moderate-income homebuyers in the purchase of owner-occupied homes. Existing law establishes the California Dream for All Fund, and continuously appropriates moneys in that fund for the purposes of the program, as prescribed. This bill would require the agency to expand the California Dream for All Program to provide additional assistance, as specified, to first-generation homebuyers, as defined. The bill would require the agency to prioritize this assistance to first-generation homebuyers purchasing homes built using specified state funding, and to expedite approval of that assistance for a first-generation homebuyer purchasing a home located in a moderate-density area, as provided. By expanding the purposes for which money in the California Dream for All Fund may be used, the bill would make an appropriation. The bill would additionally establish the Credit-Enhancement and Guarantee Fund for the purpose of distributing this assistance to specified first-generation homebuyers and would, upon appropriation, require the agency to align the distribution of funds with relevant government-sponsored enterprise pilot programs, as defined, focused on expanding access to credit for first-generation borrowers. Existing law requires the agency to convene a working group to develop recommendations to assist homeowners in qualifying for loans to construct accessory dwelling units and junior accessory dwelling units on their property and to increase access to capital for homeowners interested in building accessory dwelling units. This bill would require that working group to explore opportunities for first-generation homebuyers to use funds from the expanded California Dream for All Program as down payment assistance for small-plex or accessory dwelling unit ready properties.

Existing law, the Office to Housing Conversion Act, starting July 1, 2026, deems an adaptive reuse project, as defined, a use by right in all zones, regardless of the zoning of the site, and subject to a streamlined, ministerial review process, if the project meets specified requirements. Existing law authorizes a local government to adopt an ordinance implementing the act and specifying the process and requirements applicable to adaptive reuse projects. If a local agency does not adopt an above-described ordinance, existing law requires the local agency to ministerially, without discretionary review, approve or disapprove applications for a permit to create or serve an adaptive reuse project, as specified. Existing law, the authorizes a city or county, or city and county, commencing in the 2026–27 fiscal year, to establish an adaptive reuse investment incentive program. If a city or county, or city and county, establishes that program, existing law requires, upon approval of the governing body, the city or county, or city and county, to pay adaptive reuse investment incentive funds to the proponent of a qualified adaptive reuse project property, approved pursuant to the streamlined, ministerial process described above, to subsidize the affordable housing required under the Office to Housing Conversion Act, as specified. Existing law defines "qualified adaptive reuse project property" to mean an adaptive reuse project proposed pursuant to the Office to Housing Conversion Act that is located within the city or county. This bill would expand the definition of qualified adaptive reuse project property to include adaptive reuse projects that fall under the Office to Housing Conversion Act regardless of compliance with affordability criteria or labor standards specified in that Act, thereby expanding payment of adaptive reuse investment incentive funds to certain adaptive reuse projects that do not have the requisite affordability or labor standards as specified in the Act, as provided. The bill would also expand the requirement on those cities, counties, and cities and counties to pay adaptive reuse investment incentive funds to the proponent to, in addition to subsidizing affordable housing units, subsidize the project's housing units. Existing law authorizes a city or special district to pay to the city or county, or city and county, an amount equal to the amount of ad valorem property tax revenue allocated to that city or special district, but not the actual allocation, derived from the taxation of that portion of the total assessed value of that real property that is in excess of the property's valuation at the time of the proponent's initial request for funding, for the purpose of subsidizing the affordable housing units required pursuant to the Office to Housing Conversion Act. This bill would expand the authorization for a city or special district to pay to the city or county, or city and county, as described above, for the purpose of subsidizing the project's housing units.

The Planning and Zoning Law requires each county and each city to adopt a comprehensive, long-term general plan for the physical development of that county or city, and specified land outside its boundaries, that includes, among other specified mandatory elements, a housing element. For the 4th and subsequent revisions of the housing element, existing law requires the Department of Housing and Community Development to determine the existing and projected regional housing need, as provided, and requires the appropriate council of governments, or for cities and counties without a council of governments, the department, to adopt a final regional housing need plan allocating a share of the regional housing need to each Existing"?> city or county, as provided. Existing law requires the housing element to include an analysis of any special housing needs, including, among others, families and persons in need of emergency shelter. Existing law requires a city or county to provide by April 1 of each year an annual report to, among other entities, the department that includes, among other things, the city's or county's progress in meeting its share of regional housing needs, as specified, and number of units approved and disapproved in the prior year. The bill would authorize a city or county that met or exceeded its need for emergency shelter capacity and that provides committed support for interim housing, as defined, to report the number of interim housing units receiving that support that are approved, as specified, as units approved or disapproved for acutely low income households, for purposes of the annual progress report. The bill would require the department to allow approved interim housing units to account for up to 50% of the city's or county's share of the regional need for housing for acutely low income households, as specified. Existing law requires the department to publish, by December 31, 2026, advisory guidance, including, but not limited to, sample analyses and programs, pertaining to special housing needs for acutely low and extremely low income households and programs to assist in the development of adequate housing to meet the needs of acutely low income households, as specified. This bill would require the guidance to include advice regarding the impact of the above-described requirements regarding interim housing and pertaining to acutely low and extremely low income households, specifically how interim housing, as defined, that does not meet the United States Census Bureau guidelines definition of a "housing unit" may be reported in the annual progress report.

Existing law, the Governor's Reorganization Plan No. 1 of 2025 (GRP) , which became effective on July 5, 2025, reorganized specified state agencies and departments, including eliminating the Business, Consumer Services, and Housing Agency as of July 1, 2026, and instead establishing the Business and Consumer Services Agency and the California Housing and Homelessness Agency. The GRP, as of July 1, 2026, sets forth the general responsibilities and roles of the California Housing Homelessness Agency, the Department of Housing and Community Development, the Housing Development and Finance Committee, and the California Housing Finance Agency in carrying out state housing policies and programs. Existing law establishes programs providing assistance for, among other things, multifamily housing, farmworker housing, and veteran housing. This bill would require the California Housing and Homelessness Agency, the California Housing Finance Agency, the California Debt Limit Allocation Committee, the California Tax Credit Allocation Committee, and the Housing Development and Finance Committee, no later than July 1, 2027, when administering a multifamily affordable housing program, as specified, to, among other things, review, analyze, and make any changes necessary to their guidelines and regulations to facilitate the production and use of factory-built housing.

Existing law, in modified conformity with federal income tax laws, establishes a low-income housing tax credit program through which the California Tax Credit Allocation Committee allocates low-income housing tax credits aimed at providing affordable low-income housing within and throughout the state. Existing federal law sets limitations and guidelines regarding what projects are eligible for credits, including a requirement that an extended low-income housing commitment is in effect, and a prohibition against eviction except for good cause. This bill would specify, for housing projects where the low-income housing commitment requires 100% of the units, not including any manager's units, to be restricted to lower income households, as defined, that good cause for nonrenewal of a lease includes cases where the nonrenewal relates to a household whose income exceeds 140% of the area median income for at least 2 consecutive years and 30% of the household's monthly income exceeds the fair market rent, determined as specified. The bill would require an owner to provide notice of the potential of good cause for nonrenewal described above if the household's income exceeds 140% of the area median income during any income certification, as specified. The bill would also require an owner electing to not renew a lease as described above to issue a notice of nonrenewal describing the basis of good cause for nonrenewal at least 90 days prior to the expiration of the lease, as specified.

Existing law establishes the Department of Housing and Community Development and requires it to administer various programs intended to promote the development of housing, including the Multifamily Housing Program, pursuant to which the department provides assistance in the form of deferred payment loans to pay for the eligible costs of development of specified types of housing projects, as provided. This bill would establish the Affordable Housing Risk Reduction Program, administered by the department, to provide technical assistance and supportive resources to affordable housing providers to help them mitigate risk in their portfolio and secure more affordable insurance options. The bill would require the department to develop technical assistance to support affordable housing providers, and would authorize the department and third-party consultants to provide both individual technical assistance to affordable housing providers and develop technical assistance tools that can be made broadly accessible to those providers.