Downtown housing bill passes Assembly, heads to Senate

Haney said the state is short millions of housing units to meet the needs of those who live in California. The effort to increase housing supply would be paid for by the new Downtown Revitalization Loan Fund, which would be overseen by the California Housing Finance Authority. The fund features low-interest, revolving loans that cover up to 30% of the cost of a housing project. Loans must be paid back at the completion of the project.

“We all agree that we have to build a lot more housing in our state,” Haney said on the Assembly floor before the vote. “All of our residents and constituents are struggling with housing affordability. Let’s build these units where we can get the most bang for the buck, where they’re desperately needed, and where they make sense.”

The most logical locations are in downtown city centers, which often already have transit options, Haney said. He added that residents living in a big city’s downtown also helps small businesses in those neighborhoods and drives the economy of city centers.

“It would create a streamlined process for those projects to get done, with strong labor standards,” Haney said.

Under the bill, big cities like Los Angeles would have to designate roughly 1.5 square miles as “allowable use” in the development of high-density housing projects near transit hubs, while San Jose and San Diego would have to designate about one square mile for such projects. San Francisco, Sacramento, Long Beach and Oakland would each have to identify half a mile’s worth of land near transit hubs as locations to build housing projects that can house a lot of people, according to the bill analysis.

Multiple other members of the state Assembly testified in support of the bill from both sides of the aisle on Thursday. Assemblymember Joe Patterson, R-Rocklin, said on the Assembly floor that housing density should be intensified in the downtown neighborhoods of cities throughout the state.

“We should be doing everything we can to intensify the density in the downtown urban core where the infrastructure exists and also where there is transit,” Patterson said.

An organization that wrote in opposition to the bill, the California Housing Consortium, said it was concerned the bill would allocate taxpayer-funded loans while the state faces a structural budget deficit.

“As currently written, the bill would subsidize market-rate luxury housing unaffordable to most Californians,” the organization wrote in its analysis of the bill. “Limited public dollars should subsidize homes that are affordable to low-income people, not developments with mostly market-rate housing.”

According to a report compiled by nonprofit organizations Up for Growth and EcoNorthwest, California’s housing supply lacked 3.4 million housing units between 2000 to 2015, which created an imbalance in demand and supply.

Affordable housing became a problem and homelessness increased because of that imbalance, the report stated.