California Legislature passes $11.25B housing bond

Senate Bill 417, also known as The Veterans and Affordable Housing Bond Act, passed the Assembly 54-7 on Thursday morning. The bill then immediately went to a debate and vote on the Senate floor, where it passed 29-2.

“We have over 180,000 people experiencing homelessness. We have rent-burdened folks. We have the lowest homeownership rates,” Assemblymember Buffy Wicks, D-Oakland, said on the Assembly floor on Thursday morning. “That’s why this bond is so critical. These are the types of resources of what our government should be doing for people in our communities.”

Among other provisions of the bill, roughly $5.5 billion is allocated for multi-family housing, more than $1 billion for formerly homeless individuals and more than $1 billion for homeownership programs. The bill also stipulates that some of the bond money will pay for housing for farmworkers, students and tribal members.  Approximately $10 billion in general obligation bonds are included in the housing bond to help pay for affordable rental housing and home ownership programs, and $1.25 billion would be used to help pay for veterans housing programs.

“When we talk about this money, I want to talk about what it’s actually going to get us,” Wicks told Assembly members. “We can provide down payment assistance for 30,000 low-income families to be able to buy a home and provide 5,000 veterans with affordable mortgages so they can also have a roof over their head.”

But Republican lawmakers in the Senate said they weren’t sure Californians would vote for $10 billion of general obligation bonds, which would be included in the $11.25 billion bond under Senate Bill 417. Sen. Shannon Grove, R-Bakersfield, said on the Senate floor that she took issue with the way the bond was presented.

“Maybe the people of the state of California wouldn’t approve of $10 billion in general obligation bonds, creating additional debt,” Grove told senators. “So I would submit to all of you that this is not a veterans housing bond. It’s a veterans bait bond. To say you’re going to allow it to be a veterans bond when it uses $10 billion for other than veterans services is completely not true.”

Despite the overwhelming support for the housing bond bill from the Democratic majority in the Legislature, Republican lawmakers were skeptical about using bond funds to pay for affordable housing, considering the state’s multi-year $16.8 billion budget deficit.

“We have a record budget and record revenue,” Assemblyman David Tangipa, R-Fresno, said on the Assembly floor. “Why do we need to borrow money? If we wanted to appropriate money right now to take care of our veterans, to make affordable housing, you would do so in a record budget.”

Tangipa called the bond a “Trojan horse” that misleads California voters about what the money would really be used for, essentially leveraging future Californians’ spending power.

“How many more bonds do we need to realize that this is a bad deal?” Tangipa said. “We don’t have an affordable housing crisis. We have an available housing crisis because of the rules, regulations and debt that we are putting on the California citizens.”

Senate President Pro Tem Monique Limón, D-Santa Barbara and author of the bill, said in a Tuesday press conference that the bond would allocate billions of dollars of construction and acquisition, as well as rehabilitating existing housing. Any new construction of multi-family housing projects would have to keep at least 10% of new units available for affordable housing to qualify for any of the bond money, and roughly $150 million would be allocated to housing former foster youth and homeless young adults.

“The policy builds on the work of so many to ensure that our most vulnerable keep a roof over their heads while connecting families and first-time homebuyers to the need for homeownership opportunities,” Limón said Thursday morning on the Senate floor during the vote on the bill. “Today, we have a way in front of us to fund some of that.”