California Senate Bill SB879 Amended / Bill

 BILL NUMBER: SB 879AMENDED BILL TEXT AMENDED IN SENATE MAY 5, 2016 AMENDED IN SENATE APRIL 28, 2016 AMENDED IN SENATE MARCH 30, 2016 INTRODUCED BY Senator Beall JANUARY 15, 2016 An act to add Part 14 (commencing with Section 53570) to Division 31 of the Health and Safety Code, relating to housing, by providing the funds necessary therefor through an election for the issuance and sale of bonds of the State of California and for the handling and disposition of those funds, and declaring the urgency thereof, to take effect immediately. LEGISLATIVE COUNSEL'S DIGEST SB 879, as amended, Beall. Affordable Housing Bond Act of 2016.  (1)  Under existing law, there are programs providing assistance for, among other things, emergency housing, multifamily housing, farmworker housing, home ownership for very low and low-income households, and downpayment assistance for first-time home buyers. Existing law also authorizes the issuance of bonds in specified amounts pursuant to the State General Obligation Bond Law and requires that proceeds from the sale of these bonds be used to finance various existing housing programs, capital outlay related to infill development, brownfield cleanup that promotes infill development, and housing-related parks. This bill would enact the Affordable Housing Bond Act of 2016, which, if adopted, would authorize the issuance of bonds in the amount of $3,000,000,000 pursuant to the State General Obligation Bond Law. Proceeds from the sale of these bonds would be used to finance various existing housing programs, as well as infill infrastructure financing and affordable housing matching grant programs, as provided. The bill would provide for submission of the bond act to the voters at the November 8, 2016, statewide general election in accordance with specified law.  (2)  This bill would declare that it is to take effect immediately as an urgency statute. Vote: 2/3. Appropriation: no. Fiscal committee: yes. State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:  SECTION 1.   The Legislature finds and declares all of the following:   (a) California is experiencing an extreme housing shortage with 2.2 million extremely low-income and very low-income renter households competing for only 664,000 affordable rental homes. This leaves more than 1.54 million of California's lowest income households without access to affordable housing.   (b) While homelessness across the United States is in an overall decline, homelessness in California is rising. In 2015, California had 115,738 homeless people, which accounted for 21% of the nation's homeless population. This is an increase of 1.6% from the prior year. California also had the highest rate of unsheltered people, at 64% or 73,699 people; the largest numbers of unaccompanied homeless children and youth, at 10,416 people or 28% of the national total; the largest number of veterans experiencing homelessness, at 11,311 or 24% of the national homeless veteran population; and the second largest number of people in families with chronic patterns of homelessness, at 22,582 or 11% of the state's homeless family population.   (c) California is home to 21 of the 30 most expensive rental housing markets in the country, which has had a disproportionate impact on the middle class and the working poor. California requires the third highest wage in the country to afford housing, behind Hawaii and Washington D.C. The fair market rent, which indicates the amount of money that a given property would require if it were open for leasing, for a two-bedroom apartment is $1,386. To afford this level of rent and utilities, without paying more than 30% of income on housing, a household must earn an hourly "housing wage" of $26.65 per hour. This means that a person earning minimum wage must work an average of 3 jobs to pay the rent for a two-bedroom unit. In some areas of the state, these numbers are even higher.   (d) Low-income families are forced to spend more and more of their income on rent, which leaves little else for other basic necessities. Many renters must postpone or forego homeownership, live in more crowded housing, commute further to work, or, in some cases, choose to live and work elsewhere.   (e) California has seen a significant reduction of state funding in recent years. The funds from Proposition 46 of 2002 and Proposition 1C of 2006, totaling nearly $5 billion for a variety of affordable housing programs, have been expended. Combined with the loss of redevelopment funds, $1.5 billion of annual state investment dedicated to housing has been lost, leaving several critical housing programs unfunded.   (f) High housing costs and the shortage of housing stock in California directly affect the future health of California's economy and, given the staggering numbers indicated above, bold action is necessary. Investment in existing and successful housing programs to expand the state's housing stock should benefit California's homeless and low-income earners, as well as some of the state's most vulnerable populations, including foster and at-risk youth, persons with developmental and physical disabilities, farm workers, the elderly, single parents with children, and survivors of domestic violence. Investments should also be made in housing for Medi-Cal recipients served through a county's Section 1115 Waiver Whole Person Care Pilot program and family day care providers.   (g) Investment in housing creates jobs and provides local benefits. The estimated one-year impacts of building 100 rental apartments in a typical local area include $11.7 million in local income, $2.2 million in taxes and other revenue for local governments, and 161 local jobs or 1.62 jobs per apartment. The additional annually recurring impacts of building 100 rental apartments in a typical local area include $2.6 million in local income, $503,000 in taxes and other revenue for local governments, and 44 local jobs or .44 jobs per apartment.   SECTION 1.   SEC. 2.  Part 14 (commencing with Section 53570) is added to Division 31 of the Health and Safety Code, to read: PART 14. Affordable Housing Bond Act of 2016 CHAPTER 1. GENERAL PROVISIONS 53570. This part shall be known, and may be  cited as,   cited, as  the Affordable Housing Bond Act of 2016. 53571. As used in this part, the following terms have the following meanings: (a) "Board" means the Department of Housing and Community Development for programs administered by the department, and the California Housing Finance Agency for programs administered by the agency. (b) "Committee" means the Housing Finance Committee created pursuant to Section 53524 and continued in existence pursuant to Sections 53548 and 53582. (c) "Fund" means the Affordable Housing Bond Act Trust Fund of 2016 created pursuant to Section 53575. 53572. This part shall only become operative upon adoption by the voters at the November 8, 2016, statewide general election. CHAPTER 2. AFFORDABLE HOUSING BOND ACT TRUST FUND OF 2016 AND PROGRAM 53575. The Affordable Housing Bond Act Trust Fund of 2016 is hereby created within the State Treasury. It is the intent of the Legislature that the proceeds of bonds deposited in the fund shall be used to fund the housing-related programs described in this chapter. The proceeds of bonds issued and sold pursuant to this part for the purposes specified in this chapter shall be allocated in the following manner: (a) One billion five hundred million dollars ($1,500,000,000) to be deposited in the Multifamily Housing Account, which is hereby created in the fund. Notwithstanding Section 13340 of the Government Code, the moneys in the account are continuously appropriated for the Multifamily Housing Program authorized by Chapter 6.7 (commencing with Section 50675) of Part 2, to be expended to assist in the new construction, rehabilitation, and preservation of permanent and transitional rental housing for persons with incomes of up to 60 percent of the area median income (AMI). (b) Six hundred million dollars ($600,000,000) to be deposited in the Transit-Oriented Development and Infill Infrastructure Account, which is hereby created within the fund. The moneys in the account shall be used for the following purposes: (1) Three hundred million dollars ($300,000,000) to be transferred to the Transit-Oriented Development Implementation Fund, established pursuant to Section 53561, for expenditure, upon appropriation by the Legislature, pursuant to the Transit-Oriented Development Implementation Program authorized by Part 13 (commencing with Section 53560). (2) Three hundred million dollars ($300,000,000) to be deposited in the Infill Infrastructure Financing Account, which is hereby created within the fund. Moneys in the account shall be available, upon appropriation by the Legislature and subject to any other conditions and criteria that the Legislature provides for by statute, for infill incentive grants to assist in the new construction and rehabilitation of infrastructure that supports high-density affordable and mixed-income housing in locations designated as infill. (c) Six hundred million dollars ($600,000,000) to be deposited in the Special Populations Housing Account, which is hereby created within the fund. The moneys in the account shall be used for the following purposes: (1) Three hundred million dollars ($300,000,000) which, notwithstanding Section 13340 of the Government Code, shall be continuously appropriated for transfer to the Joe Serna, Jr. Farmworker Housing Grant Fund, established pursuant to Section 50517.5. (2) Three hundred million dollars ($300,000,000) to be deposited in the Local Housing Trust Matching Grant Program Account, which is hereby created within the fund. Moneys in the account shall be available, upon appropriation by the Legislature and subject to any other conditions and criteria that the Legislature provides for by statute, to provide matching grants to local public agencies and nonprofit organizations that raise money for affordable housing. (d) Three hundred million dollars ($300,000,000) to be deposited in the Home Ownership Development Account, which is hereby created within the fund. Notwithstanding Section 13340 of the Government Code, the moneys in the account shall be continuously appropriated for the CalHome Program authorized by Chapter 6 (commencing with Section 50650) of Part 2, to provide direct, forgivable loans to assist development projects involving multiple home ownership units, including single-family subdivisions, for self-help mortgage assistance programs, and for manufactured homes. 53576. The Legislature may, from time to time, amend any law related to programs to which funds are, or have been, allocated pursuant to this chapter for the purposes of improving the efficiency and effectiveness of those programs or to further the goals of those programs. CHAPTER 3. FISCAL PROVISIONS 53580. Bonds in the total amount of three billion dollars ($3,000,000,000), exclusive of refunding bonds, or so much thereof as is necessary, are hereby authorized to be issued and sold for carrying out the purposes expressed in this part and to reimburse the General Obligation Bond Expense Revolving Fund pursuant to Section 16724.5 of the Government Code. All bonds herein authorized which have been duly sold and delivered as provided herein shall constitute valid and legally binding general obligations of the state, and the full faith and credit of the state is hereby pledged for the punctual payment of both principal and interest of those bonds. 53581. The bonds authorized by this part shall be prepared, executed, issued, sold, paid, and redeemed as provided in the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), except subdivision (a) of Section 16727 to the extent that it is inconsistent with this part, and all of the other provisions of that law as amended from time to time which apply to the bonds and to this part and are hereby incorporated in this part as though set forth in full in this part. 53582. (a) Solely for the purpose of authorizing the issuance and sale, pursuant to the State General Obligation Bond Law, of the bonds authorized by this part, the committee is continued in existence. For the purposes of this part, the Housing Finance Committee is "the committee" as that term is used in the State General Obligation Bond Law. (b) The committee may adopt guidelines establishing requirements for administration of its financing programs to the extent necessary to protect the validity of, and tax exemption for, interest on the bonds. The guidelines shall not constitute rules, regulations, orders, or standards of general application and are not subject to Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. (c) For the purposes of the State General Obligation Bond Law, the Department of Housing and Community Development is designated the "board" for programs administered by the department, and the California Housing Finance Agency is the "board" for programs administered by the agency. 53583. Upon request of the board stating that funds are needed for purposes of this part, the committee shall determine whether or not it is necessary or desirable to issue bonds authorized pursuant to this part in order to carry out the actions specified in Section 53575, and, if so, the amount of bonds to be issued and sold. Successive issues of bonds may be authorized and sold to carry out those actions progressively, and are not required to be sold at any one time. Bonds may bear interest subject to federal income tax. 53584. There shall be collected annually, in the same manner and at the same time as other state revenue is collected, a sum of money in addition to the ordinary revenues of the state, sufficient to pay the principal of, and interest on, the bonds as provided herein, and all officers required by law to perform any duty in regard to the collections of state revenues shall collect that additional sum. 53585. Notwithstanding Section 13340 of the Government Code, there is hereby appropriated from the General Fund in the State Treasury, for the purposes of this part, an amount that will equal the total of both of the following: (a) The sum annually necessary to pay the principal of, and interest on, bonds issued and sold pursuant to this part, as the principal and interest become due and payable. (b) The sum which is necessary to carry out Section 53587, appropriated without regard to fiscal years. 53586. The board may request the Pooled Money Investment Board to make a loan from the Pooled Money Investment Account, in accordance with Section 16312 of the Government Code, for purposes of this part. The amount of the request shall not exceed the amount of the unsold bonds which the committee has, by resolution, authorized to be sold for purposes of this part, less any amount withdrawn pursuant to Section 53587. The board shall execute any documents as required by the Pooled Money Investment Board to obtain and repay the loan. Any amount loaned shall be deposited in the fund to be allocated in accordance with this part. 53587. For purposes of carrying out this part, the Director of Finance may, by executive order, authorize the withdrawal from the General Fund of any amount or amounts not to exceed the amount of the unsold bonds which the committee has, by resolution, authorized to be sold. Any amounts withdrawn shall be deposited in the fund. Any moneys made available under this section shall be returned to the General Fund, plus the interest that the amounts would have earned in the Pooled Money Investment Account, from moneys received from the sale of bonds which would otherwise be deposited in that fund. 53588. The bonds may be refunded in accordance with Article 6 (commencing with Section 16780) of Chapter 4 of Part 3 of Division 4 of Title 2 of the Government Code. Approval by the electors of this act shall constitute approval of any refunding bonds issued pursuant to the State General Obligation Bond Law. 53589. Notwithstanding any provisions in the State General Obligation Bond Law, the maximum maturity of any bonds authorized by this part shall not exceed 30 years from the date of each respective series. The maturity of each series shall be calculated from the date of each series. 53590. The Legislature hereby finds and declares that, inasmuch as the proceeds from the sale of bonds authorized by this part are not "proceeds of taxes" as that term is used in Article XIII B of the California Constitution, the disbursement of these proceeds is not subject to the limitations imposed by that article. 53591. Notwithstanding any provision of the State General Obligation Bond Law with regard to the proceeds from the sale of bonds authorized by this part that are subject to investment under Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code, the Treasurer may maintain a separate account for investment earnings, may order the payment of those earnings to comply with any rebate requirement applicable under federal law, and may otherwise direct the use and investment of those proceeds so as to maintain the tax-exempt status of those bonds and to obtain any other advantage under federal law on behalf of the funds of this state. 53592. All moneys derived from premiums and accrued interest on bonds sold pursuant to this chapter shall be transferred to the General Fund as a credit to expenditures for bond interest.  SEC. 2.   SEC. 3.  Section  1   2  of this act shall become operative upon the adoption by the voters of the Affordable Housing Bond Act of 2016.  SEC. 3.   SEC. 4.  Section  1   2  of this act shall be submitted by the Secretary of State to the voters at the November 8, 2016, statewide general election, notwithstanding the requirements of Sections 9040, 9043, 9044, and 9061 of the Elections Code or any other law.  SEC. 4.   SEC. 5.  This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are: In order to ensure that the general obligation bond measure proposed by Section 2 of this act is submitted to the voters for the November 8, 2016, statewide general election, it is necessary that this act take effect immediately.