California housing bills could take away subsidies for
homeowners and add them for renters
California lawmakers have introduced more than
130 bills this year, 2016, that
try to tackle the state’s housing affordability crisis.
A third of renters spend more than half of their income on
housing costs and the state has nearly a quarter of the nation’s homeless
residents — despite having 12% of the overall U.S. population.
Financing low-income housing
For decades, federal and state politicians have subsidized
homeowners, most prominently through giving them the ability to deduct
interest from their home mortgages on their taxes.
Bill 71 from Assemblyman
David Chiu (D-San Francisco)aims to
eliminate the state portion of that tax break for second, vacation homes and redirect the
approximately $300 million it costs the state annually toward financing
low-income housing instead.
Chiu’s bill is one of a number of efforts designed to
boost funding for low-income projects. Senate
Bill 2 from Sen. Toni
Atkins (D-San Diego) and Senate
Bill 3 from Sen. Jim Beall
(D-San Jose) are the most prominent. Atkins’ bill would raise between $230
million and $260 million a year through a $75 fee on real estate transactions,
such as mortgage refinances, except for home sales. Beall’s would put a
$3-billion bond to fund low-income housing on the 2018 statewide ballot.
Assembly Constitutional Amendment 4 from
Assemblywoman Cecilia Aguiar-Curry (D-Winters) would make it easier for local
governments to raise taxes or pass bond measures to fund low-income housing. Her proposal would lower the margin needed to pass such measures from a two-thirds
supermajority to 55%. This would also go on the
All these bills require two-thirds
supermajority votes of the Legislature to pass, so they face high
hurdles. And although most economists and housing experts believe more public
dollars are needed to house the state’s poorest residents, greater subsidies
won’t fix the problem. A report from the
nonpartisan Legislative Analyst’s Office estimated that
building affordable homes for the 1.7 million low-income households in
California that currently spend half their salaries on housing would
cost as much to finance each year as the state’s
spending on Medi-Cal.
Removing obstacles from development
Last year, Gov. Jerry Brown failed in
his bid to lessen local
restrictions for developments that reserved units for low-income residents.
His proposal by itself wouldn’t have created substantial new housing, but it would have profoundly
housing approval processes in Los Angeles, San Francisco and other cities that
have multiple hurdles in place before new housing is approved.
While no one has replicated Brown’s effort so far, lawmakers
have introduced narrower bills aimed at getting local governments to speed up
their approval of housing, or preventing cities from blocking projects.
Senate Bill 35 from Sen. Scott Wiener (D-San Francisco) would force
cities to streamline their permit processes if they’re not keeping up with state
housing production goals. Assembly
Bill 72 from Assemblyman
Miguel Santiago (D-Los Angeles), Assembly
Bill 678 from Assemblyman
Raul Bocanegra (D-Pacoima) and Senate
Bill 167 from Sen. Nancy Skinner (D-Berkeley) would strengthen and
add money to enforce a state law that prohibits cities from denying low-income
Assembly Bill 352, also from Santiago, would
force cities to permit tiny apartments — as small as 150 square feet — as a way to house people more affordably. Many cities now require
units to be larger.
Local governments have responded to this push with their own
favored legislation, including Senate
Bill 540 from Sen. Richard
Roth (D-Riverside). This bill would allow cities to borrow money
from the state to plan neighborhoods as zones for
affordable housing. Once the planning is done, approval of such
projects would be fast-tracked.
New tax breaks for renters and homebuyers
Two bills from Republican lawmakers would create or expand
housing tax breaks. Assembly
Bill 181 from Assemblyman
Tom Lackey (R-Palmdale) would double
the state tax credit that low- and middle-income renters receive to $240 for
married couples and $120 for single filers. Assembly Bill 53 from Assemblyman Marc Steinorth
(R-Rancho Cucamonga) would allow couples to save up to $20,000 tax
free — $10,000 for individuals — toward the purchase of a principal residence.
Expanding rent-controlled, low-income rentals
Assemblyman Richard Bloom (D-Santa Monica), who has consistently been
a sponsor of housing legislation, has
introduced a host of bills this year. Three proposals, Assembly bills
1505, 1506 and 1521,
would increase low-income housing by allowing cities to
force developers to build more low-income rentals as part of their
expand rent control (repeals
Costa-Hawkins Rental Housing Act) and
assisted housing development from going back on the market,
Based on a law in Massachusetts,
Bloom’s Assembly Bill 1585 would introduce an
out-of-court state appeals board for developers whose low-income housing was
‘inclusionary housing’ law appeal to U.S. Supreme Court