On January 10, Governor Newsom released his initial budget proposal for the 2022-2023 Fiscal Year.
We applaud his continued commitment to addressing the affordability crisis and appreciate the historic efforts to link investments in affordable housing development with the state’s climate goals. Making sure that people in our community can afford a decent, safe place to live is essential for a strong, healthy, and vibrant Sonoma County. Linking housing to climate goals ensures that we both lower greenhouse gas emissions and make sure that housing is built near jobs, transit, schools, and other essential services.
A summary of the housing investments in the Governor’s proposed budget are below:
Affordable Housing Resources:
- $500 million to the Infill Infrastructure Grant Program (IIG), to build affordable housing and infrastructure for infill development.
- $500 million to the state Low Income Housing Tax Credit (LIHTC).
- $300 million in the Affordable Housing and Sustainable Communities Program (AHSC), which funds land-use, housing, transportation, and land preservation projects to support infill and compact development that reduce greenhouse gas (GHG) emissions.
- $200 million to the California Housing Finance Agency’s (CalHFA) Mixed-Income Program, which provides loans to develop mixed income rental housing, for households with incomes between 30% and 120% of the Area Median Income (AMI).
- $200 million to the Portfolio Reinvestment Program, for preservation in downtown-oriented areas.
- $100 million for the Development of Excess State Land.
- $100 million for Adaptive Reuse of unused commercial properties.
- $100 million to the Mobile Home Park Rehabilitation and Resident Ownership Program.
Homelessness Resources:
- $1.5 billion to create “Behavioral Health Bridge Housing,” interim housing for people experiencing homelessness with serious behavioral health conditions
- $500 million to expand the Encampment Resolution Grant Program.
The $2 billion also includes $500 million in grants for nonprofit and for-profit developers or local governments to construct more units on existing, but underused, urban land close to city amenities and transportation, and $300 million for sustainable projects in areas friendly to walking and biking and near public transit. Newsom also wants to direct hundreds of millions of dollars toward using excess state-owned land for affordable development and easing the cost burden of converting existing structures into residential spaces in downtown areas.
The new proposal builds on the $10.3 billion state officials allotted last year to bolster mixed- and low-income housing in California, and also marks an evolution in the governor’s approach to solving the state’s multimillion-unit shortage. Most notably, the budget “blueprint” makes clear the Governor’s priorities for incentivising housing development closer to city centers in an effort to cut long car commutes and keep people near their “daily destinations.” However, $2 billion over the next two years in grants and tax credits for affordable housing, while most welcomed, is still far from enough to reverse the generational shortfall in production. This year’s budget also represents a year-over-year decrease in housing and homelessness, and falls far short of the ongoing annual investments required to fully address the scale of California’s need.
Housing California and California Housing Partnership’s Roadmap Home 2030, an evidence-based 10-year plan to end homelessness and create affordable homes for all, makes clear that California must invest $17.9 billion every year over the next decade in affordable housing and homelessness solutions in order to meet the scale of need. And yet, the cumulative total of funding allocated for addressing housing and homelessness is a mere $4 billion. Much deeper investments will be needed to fully address the long-term needs of our communities.
Generation Housing, alongside our trusted partners and allies, will strongly advocate for a May Revise of the state budget that better reflects our state’s housing needs. After all, safe, stable, and affordable housing is routinely identified as foundational to positive educational, health, and economic outcomes. Our leaders need to ensure the next iteration of the state budget proposal contains far deeper investments for building more affordable homes, preserving existing affordability, all while ensuring a broad commitment to racial equity and economic inclusion.
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