Housing California Conference

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The affordable housing community showed up in droves to the 2018 Housing California Conference. With a record attendance, it was clear to everyone the affordable housing crisis has gained significant ground.

Six candidates for California State Governor attended this year’s conference. They are all fully aware of the affordable housing crisis. There was a variety of solutions. From expediting the development process to bringing back redevelopment. We will soon find out the State’s stance on tackling the affordable housing crisis.

This year’s conference was also an opportunity to brush up on the latest trends. The workshops were plentiful. It was a great opportunity to learn about new and upcoming funding sources. HCD has relief coming are way in SB2 and SB3. Plus, an additional $2 billion will be available for supportive housing. We may want to brush up on TCAC’s new Opportunity Map. Benefits to projects located within high opportunity areas include site amenity points, increase in threshold basis limit, and a tiebreaker increase.

From the coffee and conversation with California’s gubernatorial candidates to the variety of workshop sessions, 2018’s Housing California Conference did not disappoint. And let’s not forget about the Housers After Dark event…one of the best yet.  RSG would like to thank everyone for stopping by our booth and saying hello. And a big thanks to those who participated in our game. We posed the following questions to participants:

  • What Percentage of California renters are paying more than 30% of their income on housing? Answer: 50%
  • What percentage of California owner-occupied households are paying more than 30% of their income on housing? Answer: 32%
  • Which county in the most cost burdened? Answer: Los Angeles

Out of the many participants who guessed correctly, we chose one lucky winner. Congrats to Anna Lam who received a $100 Amazon Gift Card.  This year’s Housing California Conference was the perfect blend of innovation and education and we look forward to seeing what next year has in store.

Thinking Ahead: Housing Successor Needs

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California has an increasing need for affordable housing but not enough public dollars to fund that need.  In response to a growing affordability crisis, the State Legislature is paying closer attention to existing funding sources and housing assets.  This means housing successors are under increased scrutiny to maximize their assets on a local level.  Even agencies caught up with local reporting need to think ahead to leverage assets and remain in compliance. 

Are you sure your housing successor complies with the law?  Are there outstanding items you need to address?  RSG will be sending each of our housing successor clients a Housing Diagnostic that evaluates your agency’s needs and identifies steps to maximize assets, assist low income households, and ensure future compliance.  Meeting income and age targets, taking action to dispose of or develop properties, spending funds to avoid an excess surplus, and SB 35 streamlining are a sample of the topics covered.  Producing results is more important than ever as HCD and State legislators take a closer look at existing housing funds.  If RSG does not consult your housing successor but you are interested in a diagnostic, contact Suzy Kim, Senior Associate, at skim@webrsg.com or (714) 316-2116.

Don't Miss out on Funding Opportunities - Complete your Housing Element Annual Progress Reports!

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With the passage of the 2017 Legislative Housing Package, the State has placed more importance on local government compliance with Housing Element regulations and the submission of Housing Element Annual Progress Reports (Annual Reports). Senate Bill (SB) 35 states that non-compliance with Annual Reports will now require cities and counties to use a streamlined and ministerial process for approving multi-family housing developments that satisfy the jurisdiction’s planning standards and requirements. Non-compliance occurs when either the jurisdiction has not issued enough building permits by income category to satisfy its regional housing need, or because it has failed to submit two consecutive Annual Reports.  Additionally, the California Department of Housing and Community Development (HCD) has indicated that non-compliant jurisdictions may not be eligible to apply and receive funding for affordable housing through State administered programs, such as the funding generated from SB 2: Building Homes and Jobs Act.

 

As of February 25, 2018, HCD has determined that ALL but 12 cities and counties are subject to SB35 streamlining provision. HCD updates this information at least quarterly to incorporate new or corrected data provided by jurisdictions.

 

Annual Reports are due to HCD by April 1st each year.  Although this deadline has passed, it is not too late to get into compliance.  Some cities are retroactively filing reports for 2015 through 2017.

 

Charter cities should note that even though charter cities were not required to complete Annual Reports until 2018, HCD believes that SB 35 streamlining requirement applies if a charter city has not completed an Annual Report for the last two years (2016 and 2017 ).  We recommend that if you have not met this requirement that you do so now.

Contact Suzy Kim, Senior Associate, at skim@webrsg.com or (714)316-2116, if you have questions or need assistance preparing your Annual Report to retain local control over housing development and avoid court sanctions.

 

Rolling up our Sleeves in 2018

We are excited to highlight RSG’s commitment to improving surrounding cities through our participation in a variety of professional organizations.  From positions of leadership to committee membership, RSG continues to find new ways to impart its insight and passion for helping and improving communities across California. 

California Association for Local Economic Development (CALED) -  RSG Principal Jim Simon serves as a committee member on CALED’s Legislative Action Committee and Tax Increment Financing Technical Committee.  Through his involvement with both committees, Jim has been instrumental in the drafting of proposed legislation in 2018 that may streamline and reduce costs for formation of enhanced infrastructure financing districts (EIFDs).  RSG Senior Associate Suzy Kim also serves as a member of CALED’s Tax Increment Financing Technical Committee.

San Diego Housing Federation (SDHF) – RSG Principal Tara Matthews has recently been appointed to the San Diego Housing Federation Policy Committee.  Through her contribution of leadership to the organization, Tara will be helping in the development and implementation of policies that cover a variety of topics from affordable housing in San Diego to local and state legislation.

Urban Land Institute (ULI) – RSG Principal Hitta Mosesman currently serves on ULI’s Women’s Leadership Initiative Council as a committee member.  Through her work with the organization, Hitta helps to further the organization’s overall mission of creating a path for the advancement of women in the real estate industry.  RSG Associate Dima Galkin is a member of ULI’s Public Realm Initiative Council, which aims to provide insight to all ULI members on best practices, case studies and innovations taking place within the industry. 

RSG Senior Analyst Brett Poirier serves as a member of ULI’s Young Leaders Group which looks to cultivate the use of ethical development practices and responsible land use in the industry’s up and coming leaders.  Brett is also a committee member of ULI’s Technical Assistance Panel, which performs outreach services through members volunteering their time to help address community land use issues.

Out and About

February 20-23rd - RSG will be continuing their presence this year at the annual CSMFO Conference being held in Riverside, California.  Hitta Mosesman, Principal, will be participating in a panel titled “Cannabis – Is it a solution to your General Fund Deficit?”  She, along with fellow panelists, will help shed some much-needed light on the decision for cities to utilize the recent law passage permitting the sale, cultivation and manufacturing of recreational cannabis to help subsidize funding for general fund budget deficits.  RSG will also host a booth in Exhibit Hall D where those interested can inquire about the various product and service lines we offer.

March 7-9th - RSG will be an exhibitor at the upcoming annual Housing California Conference in Sacramento, CA.  As a leader in the affordable housing industry, RSG looks forward to joining others at this event where industry leaders work together to make a collective positive impact in the housing industry.  Tara Matthews, Principal along with Greg Smith will be attending the conference and would love for you to stop by our exhibit to talk “housing”.

March 14-16th - RSG will be participating in CALED’s 38th Annual Training Conference held in Monterey, California as both a presenter and exhibitor.   The conference provides a collaborative space where leaders from California’s economic development industry can come together to network and learn new industry tools.  Jim Simon, Principal and CALED committee member will take part in a discussion titled “Do We Have Redevelopment Back?” in which the panel will discuss the tools available to economic developers on real estate projects and what lies ahead.    RSG’s Suzy Kim and Dominique Clark will also be present at our exhibit to discuss RSG’s strong presence in the Economic Development Industry as well as the products and services we offer. 

New Consequences for Housing Element Annual Reports

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The 2017 Legislative Housing Package passed 15 bills that enact new housing regulations in California.  Assembly Bill (AB) 879 and Senate Bill (SB) 35 placed increased importance on Housing Element Annual Progress Reports (Annual Reports) that are due to HCD by April 1 each year.  New consequences for failing to complete Annual Reports include court sanctions and losing local control over affordable multifamily housing development entitlements to a new streamlined approval process.   If your jurisdiction is behind on its Annual Reports, it could lose local control over affordable multifamily housing development entitlements as early as this year.

Charter Cities Must Complete Report

·         Charter cities used to be exempt from submitting an Annual Report.  They must now submit an Annual Report beginning with the 2017 report due April 1, 2018. 

Failure to Submit Annual Reports

·         Failure to submit an Annual Report within 60 days of the due date could result in court orders to compel compliance, and court sanctions if not completed as ordered.

·         Failure to submit the Annual Report for two or more consecutive years triggers SB 35 provisions streamlining affordable multifamily housing development approvals, losing significant local control over the entitlement process. 

New Annual Reporting Requirements

Local jurisdictions need to track new housing production data in 2018 to include in the Annual Report due April 2019, and ongoing years.  This includes data on:

·         Housing Development Applications and Approvals

·         Housing Production in progress (via entitlement, building permit, or certificate of occupancy)

·         Sites Identified or Rezoned to Accommodate RHNA Need (related to “No Net Loss” provisions passed by AB 166)

HCD will use new Annual Report data to determine if a locality has not issued enough building permits to satisfy its RHNA allocation by income category for a reporting period, subjecting it to SB 35 streamlining provisions until the next reporting period. 

Annual Reports due by April 1 must continue to include the Housing Successor Annual Report for redevelopment housing successors that are not Housing Authorities (Housing Authority reports are due by October 1 and December 31).

Contact Suzy Kim, Senior Associate, at skim@webrsg.com or 714.316.2116, if you have questions or need assistance preparing your Annual Report to retain local control over housing development and avoid court sanctions.

Written by Suzy Kim, a Senior Associate at RSG

AB 1598: A New Affordable Housing Tool?

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On October 13, 2017, Governor Brown signed Assembly Bill (“AB”) 1598 into law. Legislators have said that the bill, which became effective on January 1, 2018, creates a new financing tool for affordable housing. But what is this new tool exactly?

In some ways, the tool isn’t really new at all, but rather the expansion of an old tool. Building upon AB 2 from 2015, which allowed cities and counties to create Community Revitalization and Investment Authorities (“CRIAs”), AB 1598 allows cities and counties to create “affordable housing authorities.” Affordable housing authorities are authorized to use property tax increment and sales tax revenue contributed by consenting taxing entities to finance low- and moderate-income housing and affordable workforce housing.  Authorities may issue bonds payable from the pledged revenues. Schools and successor agencies, however, are not permitted to contribute from their share of tax revenue.

Affordable housing authorities must adopt and then implement a detailed affordable housing program. Unlike former redevelopment agencies, the authorities are not required to spend proceeds only in “blighted” areas. However, housing funds expended must be spent in proportion to the city/county’s Regional Housing Need Allocation (RHNA) requirements. A board made up of elected officials and local residents or employees is required to oversee each affordable housing authority.

If you are interested in learning more about whether your community could benefit from forming an affordable housing authority, please contact us at RSG today. We’re happy to help.

Written by Dominique Clark, an Associate at RSG

Facing a Unique Economic Development Challenge? Consider Taking a LEAP!

Recently, RSG partnered with the California Association for Local Economic Development (CALED) to assist with the expansion of CALED’s Local Economic Advisory Program, often simply referred to as LEAP. LEAP is an innovative technical assistance program helping cities, counties, and other communities across California achieve their economic development objectives. The program features one- or two-day events during which four leading economic development experts visit a community to tackle a specific strategic, policy, or program challenge presented by community leaders. The event culminates with the experts’ presentation to elected officials, staff, and business leaders, outlining near-term recommendations and action steps.

What kind of economic development challenge could be meaningfully addressed by a team of experts in just one or two days? Below are what we’ve found to be the top 3 characteristics of challenges that make perfect candidates for LEAP:

1.       A specific, clearly defined challenge…but no clear direction on where to start

2.       Visionary City/County staff eager to utilize an out-of-the-box approach to address the challenge

3.       Community leaders that are willing and available to participate in the process

Interested in participating in LEAP? Click here to learn more about the program!

Growing Number of San Diego County Households Paying More Than 30% of Income on Housing Expenditures

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As the California housing market continues to suppress any effects of the subprime mortgage crises, housing expenditures have swelled to levels that are considered not affordable for an alarming number of citizens. Counties such as San Francisco, San Jose, Los Angeles, Orange, and San Diego are among the least affordable markets with more and more households spending well beyond 30% of their income to keep a roof over their heads.

In San Diego County, 47% of all occupied units are spending more than 30% of its income on housing expenditures according to the U.S. Census Bureau, American Community Survey 5-Year Estimates. That number is even higher for renter-occupied units at 57%, with five cities throughout the County over 60%. Vista (44% owner, 65% renter), San Marcos (47% owner, 63% renter), and Escondido (41% renter, 64% renter) each rank among the Top 5 least affordable cities for owner- and renter-occupied units compared to Poway (31% owner, 52% renter) and Solana Beach (32% owner, 51% renter) which are among the most affordable in both categories. The City of San Diego is among the average at 36% owner-occupied and 54% renter-occupied units spending more than 30%.

The growing concern for housing affordability in San Diego County has become a wide-spread issue that is no longer isolated to the less affluent communities. The need for local governments to assess their current housing stock is among the first steps toward finding a solution that is right for its residents.    

RSG Speaking Engagements

September 28 - RSG Principal, Hitta Mosesman (resume here), was a speaker on the framing panel at the Orange County Housing Summit at Chapman University.  Ms. Mosesman presented on the effect ecommerce has had on land use and housing development in Orange County.

October 20 – RSG Principal, Jim Simon  (resume here) was the guest instructor at the City of Anaheim’s Project Manager University speaking on the topic of Economic Development Financing Fundamentals. 

October 24 - Jim Simon and Dominique Clark, Associate, (resume here) led a Real Estate Development and Reuse class at the Economic Development Certificate Program hosted by CSU Fresno and CALED.  This is Mr. Simon’s 4th time teaching this course.

October 26 - Jim Simon was a speaker at the CALAFCO conference in San Diego on October 26 in San Diego.  Mr. Simon presented “Local Agencies Fiscal Health: What is LAFCO’s Role.”

February 2018 (exact date to be determined) – Hitta Mosesman will participate on a panel on recreational cannabis and unfunded pension liabilities at the California Society of Municipal Finance Officers (CSMFO) 2018 Annual Conference in Riverside California.