Why a $10 Billion California Housing Bond Won’t be on November’s Ballot

A $10 billion statewide affordable housing bond has failed to make it to the November ballot, raising worries from housing advocates about funding after the state cut more than a billion dollars from such programs.

AB 1657, introduced by Assemblymember Buffy Wicks (D-Berkeley), was poised to be the largest housing-related bond in decades and was widely supported by housing advocates and city officials across California. It would have authorized general obligation bonds to be used for affordable rental housing programs for lower income families and supportive housing for people experiencing homelessness, among other uses.

But the Legislature had other bonds to consider and a limited capacity for authorizing new borrowing as the state faces a multibillion-dollar budget deficit. Ultimately, two measures dedicating $10 billion each for supporting the renovation of K-12 schools and helping the state prepare for climate change won spots on the November ballot, and AB 1657 died in the appropriations committee last week.

Corey Smith, executive director of advocacy group Housing Action Coalition, said his organization supported the affordable housing bond.

“I would argue housing is a climate issue,” he said to KQED. “It’s a bummer for housing advocates but frankly understandable that the Legislature did need to make tough decisions.”

He said his organization is still hopeful to get much-needed funding for affordable housing through a $20 billion regional bond measure that will appear on the November ballot after a unanimous vote in late June by the Bay Area Housing Finance Authority. In San Francisco alone, there are hundreds of units already entitled and ready to build but without the funding to start construction.

“We don’t have a pipeline problem; we just need more money [to build the] housing,” he said. “I fully expect the queue of projects to go faster than the dollars will come in.”

The potential bond borrowing comes as the state faces a $56 billion revenue gap, expected to last over the next two years. Gov. Gavin Newsom’s recently signed budget deal cut about $1.1 billion in funding for affordable housing programs and $500 million for student housing.

In November, Bay Area voters will also vote on whether to make it easier for local municipalities to pass bonds and taxes that fund affordable housing and infrastructure. Right now, those kinds of measures require a two-thirds supermajority, or 66% of residents voting in favor, to pass. Proposition 5 would lower that threshold to 55%.

Proposition 33, also appearing in November, would ask voters to decide on expanding rent control. Many local governments are prevented from enacting rent control measures on single family homes and units built after 1955, thanks to the controversial Costa-Hawkins Rental Housing Act. Voters have already rejected attempts to appeal this act twice in 2018 and 2020, but the AIDS Healthcare Foundation is hoping the third time’s the charm.