California Assembly Bill AB1969 Amended / Bill

 BILL NUMBER: AB 1969AMENDED BILL TEXT AMENDED IN ASSEMBLY APRIL 13, 2016 AMENDED IN ASSEMBLY APRIL 6, 2016 AMENDED IN ASSEMBLY MARCH 17, 2016 INTRODUCED BY Assembly Member Steinorth FEBRUARY 16, 2016 An act to amend Section  51451.5   51504  of the Health and Safety Code, relating to housing, and making an appropriation therefor. LEGISLATIVE COUNSEL'S DIGEST AB 1969, as amended, Steinorth. Affordable housing: home purchase assistance. Existing law establishes the  Homebuyer Down Payment   California Homebuyer's Downpayment  Assistance  Program of 2002 to provide assistance in the amount of the applicable school facility fee on affordable housing developments. Existing law requires the program to provide purchasers of newly constructed residential structures in development projects with assistance if the development project is located in an economically distressed area and other specified requirements are met, or if the purchaser is a qualified first-time home buyer and other specified requirements are met. Under existing law, the program is funded by bonds sold pursuant to the Housing and Emergency Shelter Trust Fund Act of 2002, which was approved by the voters at the November 5, 2002, statewide general election.   Program, which requires the California Housing Finance Agency to, among other things, administer a program that provides downpayment assistance, including deferred-payment, low-interest, junior mortgage loans to reduce principal and interest payments, that makes financing affordable to first-time low- and moderate-income home buyers, pursuant to specified terms.  This bill would appropriate an unspecified amount from the General Fund to the California Homebuyer's Downpayment Assistance  Program of 2002.   Program for the purposes of the downpayment assistance program described above.  The bill would condition the application of these funds  to the assistance to purchasers of residential structures in development projects located in economically distressed areas, as described above,  on an additional requirement that the  home for which assistance is provided be in a  development project  be  located in a city, county, or city and county that reduces developer or impact fees or reduces or removes regulatory barriers to housing construction for the development project, as specified. As part of this additional requirement, the bill would require a local agency to provide verification of the local agency's schedule of local fees, charges, and other exactions to the California Housing Finance Agency, and would thereby impose a state-mandated local program. The bill would make these moneys available for the general use of the California Housing Finance Agency for the purposes of the California Homebuyer's Downpayment Assistance Program, if specified requirements are met. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that, if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to these statutory provisions. Vote: 2/3. Appropriation: yes. Fiscal committee: yes. State-mandated local program: yes. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:  SECTION 1.   Section 51451.5 of the Health and Safety Code, as amended by Section 1 of Chapter 553 of the Statutes of 2003, is amended to read: 51451.5. The Homebuyer Down Payment Assistance Program of 2002 is hereby established, to provide assistance in the amount of the applicable school facility fee on affordable housing developments. The Homebuyer Down Payment Assistance Program of 2002 shall, with funds provided by the Housing and Emergency Shelter Trust Fund Act of 2002 (Part 11 (commencing with Section 53500)), provide the following assistance: (a) Downpayment assistance to the purchaser of any newly constructed residential structure in a development project in an economically distressed area in the amount of school facility fees paid pursuant to Section 65995.5 or 65995.7 of the Government Code, less the amount that would be required pursuant to subdivision (b) of Section 65995 of the Government Code, notwithstanding Sections 65995.5 and 65995.7 of the Government Code, if all of the following conditions are met: (1) The development project is located in a county with an unemployment rate that equals or exceeds 125 percent of the state unemployment rate. (2) Five hundred or more residential structures have been constructed in the county during 2001. (3) A building permit for an eligible residential structure in the development project is issued by the local agency on or after January 1, 2002. (4) The eligible residential structure is to be owner occupied for at least five years. If a structure is owner occupied for fewer than five years, the recipient of the assistance shall repay the School Facilities Fee Assistance Fund the amount of the assistance, on a prorated basis. (5) The sales price of the eligible residential structure does not exceed 175 percent of the median sales price of residential structures in the county during the average of the previous five years. However, if the five-year average exceeds the Governmental-Sponsored Enterprises conforming loan limit, the sales price in that county shall not exceed 100 percent of the median sales price of residential structures in the county during the average of the previous five years. (b) Downpayment assistance to the purchaser of any newly constructed residential structure in a development project in the aggregate amount of school facility fees paid pursuant to one, all, or any combination of subdivision (b) of Section 65995, Section 65995.5, or Section 65995.7 of the Government Code for the eligible residential structure if all of the following conditions are met: (1) The assistance is provided to a qualified first-time homebuyer pursuant to Section 50068.5. (2) The qualified first-time homebuyer does not exceed the lower or moderate-income requirements in Section 50093. (3) A building permit for an eligible residential structure in the development project is issued by the local agency on or after January 1, 2002. (4) The eligible residential structure is to be owner occupied for at least five years. If a structure is owner occupied for fewer than five years, the recipient of the assistance shall repay the School Facilities Fee Assistance Fund the amount of the assistance, on a prorated basis. (c) Downpayment assistance from funds appropriated by the act adding this subdivision to provide assistance in the amount of the applicable school facility fee on affordable housing shall be available to the purchaser of any newly constructed residential structure in a development project in an economically distressed area if the following requirements are met: (1) The downpayment assistance is in the amount of school facility fees paid pursuant to Section 65995.5 or 65995.7 of the Government Code, less the amount that would be required pursuant to subdivision (b) of Section 65995 of the Government Code, notwithstanding Sections 65995.5 and 65995.7 of the Government Code. (2) The downpayment assistance is for a residential structure that satisfies the conditions described in paragraphs (1) to (5), inclusive, of subdivision (a). (3) The development project is located in a city, county, or city and county that reduces developer or impact fees or reduces or removes regulatory barriers to housing construction for the development project. The agency shall identify and shall objectively measure the types of local agency actions or incentives that the agency determines appropriately reduce developer or impact fees or reduce or remove regulatory barriers to housing construction. These actions or incentives may include, but are not limited to, modifications to any or all of the following: (A) Local design review requirements. (B) Land use controls. (C) Building codes and enforcement. (D) Onsite or offsite improvement requirements. (E) Project design. (F) Permit processing. (G) (i) A 30 percent reduction in the schedule of local fees, charges, and other exactions on local developers within the local agency's jurisdiction within 12 months or more prior to the submission of the application for assistance pursuant to this subdivision. The local agency shall provide verification of the reduction with supporting documents showing successive annual fee schedules to the agency. (ii) For the purposes of this subparagraph, "local fees, charges, and other exactions" includes, but is not limited to, all of the following: (I) Planning and zoning fees. (II) Environmental documentation fees. (III) Building permit fees. (IV) Plan check fees. (V) School fees. (VI) School mitigation fees. (VII) Highway, road, traffic, and transit fees. (VIII) Water, wastewater, sewer, and drainage fees. (IX) Utility or water connection fees. (X) Public safety fees. (XI) Capital facilities fees. (XII) Affordable housing fees and assessments. (XIII) Parks and recreation fees. (XIV) Any other fee that may substitute for the requirements described in subparagraph (D).   SEC. 2.   Section 51451.5 of the Health and Safety Code, as amended by Section 2 of Chapter 553 of the Statutes of 2003, is amended to read: 51451.5. The Homebuyer Down Payment Assistance Program of 2002 is hereby established, to provide assistance in the amount of the applicable school facility fee on affordable housing. The Homebuyer Down Payment Assistance Program of 2002 shall, with funds provided by the Kindergarten-University Public Education Facilities Bond Acts of 2002 and 2004 (Part 68.1 (commencing with Section 100600) of the Education Code, and Part 68.2 (commencing with Section 100800) of the Education Code), provide the following assistance: (a) Downpayment assistance to the purchaser of any newly constructed residential structure in a development project in an economically distressed area in the amount of school facility fees paid pursuant to Section 65995.5 or 65995.7 of the Government Code, less the amount that would be required pursuant to subdivision (b) of Section 65995 of the Government Code, notwithstanding Sections 65995.5 and 65995.7 of the Government Code, if all of the following conditions are met: (1) The development project is located in a county with an unemployment rate that equals or exceeds 125 percent of the state unemployment rate. (2) Five hundred or more residential structures have been constructed in the county during 2001. (3) A building permit for an eligible residential structure in the project is issued by the local agency on or after January 1, 2002. (4) The eligible residential structure is to be owner occupied for at least five years. If a structure is owner occupied for fewer than five years, the recipient of the assistance shall repay the School Facilities Fee Assistance Fund the amount of the assistance, on a prorated basis. (5) The sales price of the eligible residential structure does not exceed 175 percent of the median sales price of residential structures in the county during the average of the previous five years. However, if the five-year average exceeds the Governmental-Sponsored Enterprises conforming loan limit, the sales price in that county shall not exceed 100 percent of the median sales price of residential structures in the county during the average of the previous five years. (b) Downpayment assistance to the purchaser of any newly constructed residential structure in a development project in the aggregate amount of school facility fees paid pursuant to one, all, or any combination of subdivision (b) of Section 65995, Section 65995.5, or Section 65995.7 of the Government Code for the eligible residential structure if all of the following conditions are met: (1) The assistance is provided to a qualified first-time home buyer pursuant to Section 50068.5. (2) The qualified first-time home buyer does not exceed the lower or moderate-income requirements in Section 50093. (3) A building permit for an eligible residential structure in the project is issued by the local agency on or after January 1, 2002. (4) The eligible residential structure is to be owner occupied for at least five years. If a structure is owner occupied for fewer than five years, the recipient of the assistance shall repay the School Facilities Fee Assistance Fund the amount of the assistance, on a prorated basis. (c) Downpayment assistance from funds appropriated by the act adding this subdivision to provide assistance in the amount of the applicable school facility fee on affordable housing shall be available to the purchaser of any newly constructed residential structure in a development project in an economically distressed area if the following requirements are met: (1) The downpayment assistance is in the amount of school facility fees paid pursuant to Section 65995.5 or 65995.7 of the Government Code, less the amount that would be required pursuant to subdivision (b) of Section 65995 of the Government Code, notwithstanding Sections 65995.5 and 65995.7 of the Government Code. (2) The downpayment assistance is for a residential structure that satisfies the conditions described in paragraphs (1) to (5), inclusive, of subdivision (a). (3) The development project is located in a city, county, or city and county that reduces developer or impact fees or reduces or removes regulatory barriers to housing construction for the development project. The agency shall identify and shall objectively measure the types of local agency actions or incentives that the agency determines appropriately reduce developer or impact fees or reduce or remove regulatory barriers to housing construction. These actions or incentives may include, but are not limited to, modifications to any or all of the following: (A) Local design review requirements. (B) Land use controls. (C) Building codes and enforcement. (D) Onsite or offsite improvement requirements. (E) Project design. (F) Permit processing. (G) (i) A 30 percent reduction in the schedule of local fees, charges, and other exactions on local developers within the local agency's jurisdiction within 12 months or more prior to the submission of the application for assistance pursuant to this subdivision. The local agency shall provide verification of the reduction with supporting documents showing successive annual fee schedules to the agency. (ii) For the purposes of this subparagraph, "local fees, charges, and other exactions" includes, but is not limited to, all of the following: (I) Planning and zoning fees. (II) Environmental documentation fees. (III) Building permit fees. (IV) Plan check fees. (V) School fees. (VI) School mitigation fees. (VII) Highway, road, traffic, and transit fees. (VIII) Water, wastewater, sewer, and drainage fees. (IX) Utility or water connection fees. (X) Public safety fees. (XI) Capital facilities fees. (XII) Affordable housing fees and assessments. (XIII) Parks and recreation fees. (XIV) Any other fee that may substitute for the requirements described in subparagraph (D).   SECTION 1.   Section 51504 of the  Health and Safety Code   is amended to read:  51504. (a) The agency shall administer a downpayment assistance program that includes, but is not limited to, all of the following: (1) Downpayment assistance shall include, but not be limited to, a deferred-payment, low-interest, junior mortgage loan to reduce the principal and interest payments and make financing affordable to first-time low- and moderate-income home buyers. (2) (A) Except as provided in subparagraph (B) or (C), the amount of downpayment assistance shall not exceed 3 percent of the home sale price. (B) The amount of downpayment assistance for a new home within an infill opportunity zone, as defined in Section 65088.1 of the Government Code, a transit village development district, as defined in Section 65460.4 of the Government Code, or a transit-oriented development specific plan area, as defined in paragraph (6), shall not exceed 5 percent of the purchase price or the appraised value, whichever amount is less, of the new home. The borrower of the downpayment assistance shall provide the lender originating the loan with a certification from the local government agency administering the infill opportunity zone, the transit village development district, or the transit-oriented development specific plan area that states that the property involved in the loan transaction is within the boundaries of either the infill opportunity zone, the transit village development district, or the transit-oriented development specific plan area. (C) Notwithstanding paragraph (1), the agency may, but is not required to, provide downpayment assistance that does not exceed 6 percent of the home sale price to first-time low-income home buyers who, as documented to the agency by a nonprofit organization that is certified and funded to provide home ownership counseling by a federally funded national nonprofit corporation, are purchasing a residence in a community revitalization area targeted by the nonprofit organization as a neighborhood in need of economic stimulation, renovation, and rehabilitation through efforts that include increased home ownership opportunities for low-income families. The agency shall not use more than six million dollars ($6,000,000) in funds made available pursuant to Section 53533 for the purposes of this paragraph. (3) The amount of the downpayment assistance shall be secured by a deed of trust in a junior position to the primary financing provided. The term of the loan for the downpayment assistance shall not exceed the term of the primary loan. (4) (A) Except as provided in subparagraphs (B) and (C), the amount of the downpayment assistance shall be due and payable at the end of the term or upon sale of or refinancing of the home. The borrower may refinance the mortgages on the home provided that the principal and accrued interest on the junior mortgage loan securing the downpayment assistance are repaid in full. All repayments shall be made to the agency to be reallocated for the purposes of this chapter. (B) The agency may, in its discretion, permit the downpayment assistance loan to be subordinated to refinancing if it determines that the borrower has demonstrated hardship, subordination is required to avoid foreclosure, and the new loan meets the agency's underwriting requirements. The agency may permit subordination on those terms and conditions as it determines are reasonable. (C) The amount of the downpayment assistance shall not be due and payable upon sale of the home if the first mortgage loan is insured by the Federal Housing Administration (FHA) or if the first mortgage loan is, or has been, transferred to the FHA, or if the requirement is otherwise contrary to regulations of the United States Department of Housing and Urban Development governing FHA insured first mortgage loans. (5) The agency may use up to 5 percent of the funds appropriated by the Legislature for purposes of this chapter to administer this program. (6) For purposes of this section, "transit-oriented development specific plan area" means a specific plan that meets the criteria set forth in Section 65451 of the Government Code, is centered around a rail or light-rail station, ferry terminal, bus hub, or bus transfer station, and is intended to achieve a higher density use of land that facilitates use of the transit station. (b) In addition to the downpayment assistance program authorized by subdivision (a), the agency may, at its discretion, use not more than seventy-five million dollars ($75,000,000) of the funds available pursuant to this chapter to finance the acquisition of land and the construction and development of housing developments, as defined in Section 50073.5, and for-sale residential structures through short-term loans pursuant to its authority pursuant to Section 51100. However, the agency shall make downpayment assistance provided pursuant to paragraph (1), subparagraphs (A) and (B) of paragraph (2), and paragraphs (3) to (5), inclusive, of subdivision (a) the priority use for these funds. A loan made pursuant to this section is not subject to Article 4 (commencing with Section 51175) of Chapter 5.  (c) (1) In addition to the downpayment assistance program authorized by subdivision (a), the agency shall provide downpayment assistance from the funds appropriated by the act adding this subdivision to first-time home buyers pursuant to paragraphs (1), (2), (3), (4), and (6) of subdivision (a) for homes in development projects that are located in cities, counties, or cities and counties that reduce developer or impact fees or reduce or remove regulatory barriers to housing construction for the development projects. The agency shall identify and shall objectively measure the types of local agency actions or incentives that the agency determines appropriately reduce developer or impact fees or reduce or remove regulatory barriers to housing construction. These actions or incentives may include, but are not limited to, modifications to any or all of the following:   (A) Local design review requirements.   (B) Land use controls.   (C) Building codes and enforcement.   (D) Onsite or offsite improvement requirements.   (E) Project design.   (F) Permit processing.   (G) (i) A 30-percent reduction in the schedule of local fees, charges, and other exactions on local developers within the local agency's jurisdiction within 12 months or more prior to the submission of the application for assistance pursuant to this subdivision. The local agency shall provide verification of the reduction with supporting documents showing successive annual fee schedules to the agency.   (ii) For the purposes of this subparagraph, "local fees, charges, and other exactions" includes, but is not limited to, all of the following:   (I) Planning and zoning fees.   (II) Environmental documentation fees.   (III) Building permit fees.   (IV) Plan check fees.   (V) School fees.   (VI) School mitigation fees.   (VII) Highway, road, traffic, and transit fees.   (VIII) Water, wastewater, sewer, and drainage fees.   (IX) Utility or water connection fees.   (X) Public safety fees.   (XI) Capital facilities fees.   (XII) Affordable housing fees and assessments.   (XIII) Parks and recreation fees.   (XIV) Any other fee that may substitute for the requirements described in subparagraph (D).   (2) Paragraph (1) applies only to the use of funds appropriated by the act adding this subdivision and shall not be construed to apply to the use of any other funds.   SEC. 3.   SEC. 2.  If the Commission on State Mandates determines that this act contains costs mandated by the state, reimbursement to local agencies and school districts for those costs shall be made pursuant to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of the Government Code.  SEC. 4.   SEC. 3.  The sum of ____ dollars ($____) is hereby appropriated from the General Fund to the California Homebuyer's Downpayment Assistance Program for the purposes set forth in Section  51451.5   51504  of the Health and Safety Code that satisfy the requirements of subdivision (c) of that section. After 48 months of availability, if the California Housing Finance Agency determines that these moneys will not be utilized for the purposes set forth in Section  51451.5   51504  of the Health and Safety Code that satisfy the requirements of subdivision (c) of that section, the moneys shall be available for the general use of the California Housing Finance Agency for the purposes of the California Homebuyer's Downpayment Assistance Program, but may also continue to be available for the purposes set forth in Section  51505   51504  of the Health and Safety Code.