On June 1, the California State Legislature released their Fiscal Year (FY) 2022-23 Joint Budget Outline, in response to Gov. Gavin Newsom’s May Revise proposal. The Budget Outline includes several of Enterprise’s key budget priorities, and we extend our gratitude to the Legislature and the Administration for their partnership and commend their continued leadership on housing and homelessness.
With a record surplus of $97.5 billion, California has a golden opportunity to take advantage of this historic moment and significantly increase funding for affordable housing and to address homelessness. While the proposed investments remain substantial, larger investments are necessary to meet the housing needs of low-income Californians today.
The Legislature and the Governor must reach a final budget agreement by June 15. Now is the time to raise our collective voices in support of affordable housing and homelessness investments. Contact Gov. Newsom and Legislative leadership (Senate President Pro Tempore Toni Atkins, Assembly Speaker Anthony Rendon, Senator Nancy Skinner and Assemblymember Phil Ting) today to tell them why affordable housing is an essential investment for this year’s budget!
Community Anti-Displacement and Preservation Program
Enterprise is thrilled to see that the Legislature’s Budget Outline included $200 million for the Community Anti-Displacement and Preservation Program (CAPP). With this first-of-its-kind investment in the acquisition and preservation of private-market rental housing, CAPP will fund a proven strategy to prevent displacement today, while also growing our supply of affordable housing for generations to come.
We applaud the Legislature, particularly Assemblymember Richard Bloom who championed this program, for their commitment to including CAPP in the Budget Outline. CAPP is a key priority this year for Enterprise as well as our partners at the California Housing Partnership and the Stable Homes Coalition, which Enterprise co-leads with our partners Housing California and Public Advocates.
CAPP presents a transformative opportunity for low-income Californians in urgent need of stable, affordable housing. In order to begin to make an impact at scale and to support this work equitably across the state, we continue to respectfully urge our state leaders to include the full request of $500 million for CAPP in the final FY 2022-2023 budget.
California Housing Accelerator Program
Enterprise is also delighted to see $300 million for the California Housing Accelerator Program included in the Budget Outline. The Accelerator Program provides critical funding to unlock shovel-ready affordable homes that otherwise cannot move forward to construction, due to a shortfall of federal resources.
We commend the Legislature for including funding for the Accelerator Program. As communities across the state prepare to meet their housing production goals mandated by state law, California cannot afford to let shovel-ready affordable homes stall while they await final funding.
Recent research conducted by Enterprise found that the state will need to investment far more than $300 million in order to meet the needs of the current pipeline of affordable homes and allow them to move forward to construction. Our research found that there are currently 30,677 affordable homes in the near-term affordable housing pipeline in need of final financing to begin construction.
But with the current levels of funding available through state and federal tax credits, tax-exempt bonds and the funds already allocated to the California Housing Accelerator program, only 16,624 of those homes stand to move forward this year. The analysis found that the state would need to dedicate $4 billion to the California Housing Accelerator program to develop the remaining 14,053 homes, which is why Enterprise is joining with our partners to respectfully urge state leaders to increase this year’s investment in this important program.
It can take years for affordable housing developers to assemble the financing, community buy-in and cross-sector partnerships required to break ground on a new development. As prices rise even further out of reach for the lowest-income Californians, we cannot allow a gap in financing to prevent 14,000 homes from crossing the finish line.
The budget surplus is an opportunity to invest in our communities and with our values. Directing even a portion of the surplus to affordable housing would have a massive impact.
For more information, please contact Senior State and Local Policy Director Justine Marcus.