Dear John,

Late last week, Governor Gavin Newsom released his proposed budget for California’s 2021-22 fiscal year. While there is much happening at the national level that is rightly seizing our attention, this action (owing to a Constitutionally-designated deadline) has critical implications for our work to advance housing and racial justice in the Bay Area and beyond.

NPH Policy Director Pedro Galvao shares his most important takeaway on the Governor’s January Budget.

First, we want to acknowledge and appreciate that the Governor’s proposal demonstrates a clear understanding that housing and homelessness are one of the most critical issues facing Californians. The proposal offers crucial support across the 3Ps framework of production, preservation, and protections -- while also designating a substantial one-time expenditure to reduce homelessness.

There are also a number of areas where we expect -- and will advocate for -- lawmakers to expand and invest more deeply to make impact for all California families, including our Black, Indigenous, and other communities of color. These investments include funding the Bay Area Housing Finance Authority; expanding renter protections, especially during COVID; matching the efforts to reduce homelessness with programs to prevent homelessness and provide deeply affordable housing; and keeping homes affordable by investing in more targeted preservation strategies.  

Key takeaways from the proposal include:

• The current proposal expands affordable home options for California families by maintaining the $500 million expansion of the state low income housing tax credits, the state’s primary vehicle to support the creation and preservation of affordable homes for California’s low income families and individuals. Here in the Bay Area, we could anticipate that our region will receive around $85-120 million in investments from this budget designation -- which will be matched by other state and local funding -- based on previous years’ allocations.
   
• The proposal offers a one-time expenditure of $1.75 billion to reduce homelessness. In the Bay Area, there are 35,000 people on any given night experiencing homelessness. These investments will be critical in halting those numbers from rising -- yet will need to be matched by ongoing investments focused on prevention and services, as well as increasing the supply of permanent supportive housing and extremely low-income housing.

• The proposal offers some rental support -- though lawmakers will need to expand these protections both through the budget and beyond. The current budget proposal includes an additional $600 for low income taxpayers to help with expenses, including rent. This -- in conjunction with the $2.6 billion for rental assistance that California is receiving from federal COVID relief -- offers critical financial support, though the state will also need to take fast action on a statewide eviction moratorium through AB 15 and take up AB 16 to create a more robust rental assistance program.
   
• Lawmakers must invest in the Bay Area’s ability to create regional solutions for our regional challenges. The state authorized the Bay Area Housing Finance Authority via NPH-sponsored AB 1487 in the 2019 session, and now needs to fund that agency to carry its work forward to general regional housing solutions for our regional challenges.
   
• We must invest in targeted preservation strategies. NPH and our allies are seeking significant state budget funds to support purchasing and preserving as permanently affordable both market rate apartment buildings and existing affordable housing with expiring restrictions. In the Bay Area, there are approximately 35,000 homes at risk of conversion to market rate that we could preserve as affordable through such investments.

As we look ahead to 2021, we can't ignore the political and social tensions that continue to erupt. These tensions may test our resolve, but they also remind us that now, more than ever, our work is critical for our communities and neighbors who rely on us to stand up for justice. 

We must remain committed to advocating for housing and racial justice at all the levels -- the region, state, and national level. 

We count on you, John, to press on alongside us. We need your voice and will as we continue to advance our collective vision of effecting tangible change and creating a just tomorrow. We can't do this without you, so please join us in this important work as we take on 2021, together.

Thank you,

Pedro Galvao
NPH Policy Director