Legislature Approves Bills to Address California's Housing Crisis

Responding to a severe shortage of housing in the state, California lawmakers passed legislation Thursday to boost production and ease approval of housing at the local level.

In a series of bipartisan votes, the Senate and Assembly approved legislation that would streamline the permitting of some housing developments, present voters with a $3 billion bond to fund affordable housing and build supportive housing for the state's homeless population.

The legislation addressed two sides of the housing policy coin: Funding to increase housing development and access, and reforms to make it harder to block new projects.

"California’s expensive housing market has a disproportionate impact on the middle class and working poor," said Sen. Jim Beall (D-San Jose), the author of Senate Bill 3, the housing bond.

If approved by the Assembly and signed by Gov. Jerry Brown, the bond measure would go before voters in the November 2018 election. The billions would be invested in existing state housing programs, with the hope of offsetting the costs that typically dissuade builders from constructing below-market-rate units.

The measure received multiple Republican votes, though some GOP senators worried about adding to the state's "wall of debt." Voters in November approved a $9 billion bond for school construction, and lawmakers have advanced a number of bond proposals so far this year.

"Can California afford yet another general obligation bond?" asked Sen. John Moorlach (R-Irvine). "I would suggest we cannot."

The Assembly approved a measure by David Chiu (D-San Francisco) to give rental assistance to chronically homeless Californians. Proponents say that housing the homeless will drive down other public costs.

"Today we spent countless dollars after someone is on the street on emergency rooms and other very expensive health care services," Chiu said.

The fate of that measure, Assembly Bill 74, could be decided in the budget process through negotiations between the governor and lawmakers. An identical measure was vetoed by Gov. Brown last year, who argued the program should come with a new funding source. Assembly Democrats set aside $90 million of general fund money in their budget proposal for the program, but it's unclear if the Senate and governor will go along with that idea.

Rule Changes to Encourage Housing Production

Legislators carrying the housing funding bills acknowledged that new money must be paired with major revisions to the approval process of local developments.

"This bond on its own will not solve our deep housing crisis," said Beall. "We must continue to work on the reforms."

Those reforms include making it more difficult for housing projects to be blocked at the local level.

Senate Bill 35, from Sen. Scott Wiener (D-San Francisco), would allow housing developments to be approved without public hearings and reviews under the California Environmental Quality Act. The developments must be located in areas that have failed to meet statewide housing goals and still would require local oversight.

"Local control is about how you meet your housing goals, not whether you meet your housing goals," said Wiener.

Chiu had his own streamlining legislation pass the Assembly. AB 73 would allow cities or counties to create special "districts" where developments could be more easily approved.

"This opt-in incentive approach would encourage localities to do the right thing and build the housing that our state desperately needs," Chiu said.