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Assembly Democrats want more than $1 billion for affordable housing next year

Assemblyman David Chiu (D-San Francisco) announces a $1.3-billion affordable housing proposal on Monday at the Capitol. (Liam Dillon / Los Angeles Times)
Assemblyman David Chiu (D-San Francisco) announces a $1.3-billion affordable housing proposal on Monday at the Capitol. (Liam Dillon / Los Angeles Times)

A dozen Assembly Democrats made a pitch Monday for more than $1 billion in state funding for affordable housing programs next year, a move they said would help California’s most vulnerable deal with soaring housing costs, but one that would only be a drop in the bucket in addressing the state’s housing needs.

The plan provides a mixture of tax credits, development subsidies and grants to spur homebuilding for those with the lowest incomes in the state, including farmworkers and the homeless.

“This investment will address poverty among Californians with the lowest 25% of incomes who spent two-thirds of their income on housing,” said Assemblyman David Chiu (D-San Francisco), a co-author of the measure.

Chiu said the package would allow for the building of up to 25,000 new affordable units over time. California’s housing problems, though, are far greater than that. An estimate from the independent Legislative Analyst’s Office says that the state needs to build roughly 110,000 additional units each year to keep pace with rising housing prices. Currently, California’s $459,000 average home price is more than twice the national average.

There is no pending legislation to make it easier to build homes in the state on a broad scale, such as easing environmental requirements or reforming tax policy to incentivize residential development.

Chiu said lawmakers understand the state needs to do more on housing, but can’t ignore the most needy.

“We don’t think the answer is to do nothing,” he said.

Assembly Democrats who attended Monday’s news conference, including Speaker Anthony Rendon (D-Paramount), say they’re requesting money for the plan in year’s budget. Chiu said the one-time budget allocation would be about a third of the state’s projected budget surplus.

A budget spokesman for Gov. Jerry Brown declined to comment on the proposal.

Last year, Brown vetoed a widely supported Chiu bill that would have offered a tax credit for low-income homebuilders, saying the Legislature should make such funding requests during the budget process. Chiu said this plan is a response to Brown’s criticism.

Beyond the low-income tax credit, the Assembly Democrats' plan would provide grants to local governments to help middle-class families in high-cost areas with downpayment and other home buying assistance as well as provide funding for the construction of new farmworker housing and supportive housing for the homeless.

Assembly Republicans were cold to the measure, responding that the state should emphasize easing regulations on homebuilding rather than subsidies to address affordability.

"I think government intervention is what created the crisis in the first place," said Marc Steinorth (R-Rancho Cucamonga). "I think government needs to get out of the way and allow the free market to create its own way out of this by really eliminating red tape."

UPDATE:

5:15 p.m.: This story was updated with more context on the proposal and the GOP response.

This post was originally published at 1:47 p.m.


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