50540-50546

HEALTH AND SAFETY CODE
SECTION 50540-50546




50540.  This chapter shall be known and may be cited as the
Jobs-Housing Balance Improvement Program.



50541.  The Legislature finds and declares all of the following:
   (a) Despite strong economic growth and record-level unemployment
in most areas of the state, California has fallen seriously short of
its policy of providing every California family with the opportunity
to live in decent, affordable housing in a suitable living
environment.
   (b) The Department of Finance estimates that to meet California's
housing need, 230,000 new residential units per year must be built.
   (c) For each of the last eight years, California has produced only
50 percent of the housing to meet its need, resulting in a critical
accumulated deficit.
   (d) Although the lack of sufficient housing is a statewide problem
cutting across all geographic areas and income categories, it is
most severe in strong economic job center markets where high housing
costs make it extremely difficult for working-class Californians to
afford a home.
   (e) Increasingly, due to high housing costs and constraints on
regulatory development policy, California workers are forced to seek
homeownership opportunities further and further away from their
places of employment.
   (f) Conversely, many communities where land is more available and
less expensive are located long distances from high-growth job
centers. Those developments are occupied predominantly by commuters
who travel long distances outside of the communities in which they
live and inflate the price of housing.
   (g) The exportation of housing demand to outlying areas, including
agricultural areas, carries with it definite environmental and
quality of life consequences.
   (h) Throughout the state, major investments have been, and are
being made, in public transit infrastructure. The use of this
infrastructure depends on local decisions about the location of jobs
and housing to better manage traffic flow and to direct new
development and fiscal resources to revive existing urban centers,
especially central business districts and infill sites.
   (i) Ensuring that transit facilities are surrounded by compact,
mixed-use development is a key to increasing transit ridership and
reducing reliance on the automobile for all trips. However,
neighborhood concerns, complex ownership issues, and local government
preference for major sales tax generators make the planning and
environmental clearance process for transit-oriented communities very
expensive and time-consuming. Investment in pedestrian-friendly,
compact transit-village development will reduce long-term
infrastructure costs associated with accommodating new highways and
roadways.
   (j) The failure to provide California's growing workforce an
affordable place to live close to one's place of employment is viewed
by business, environmental, civic, and labor leaders as a serious
threat to sustaining long-term economic prosperity and environmental
quality.
   (k) Communities need effective tools to promote and reward
development in job centers of the state, to reward the development of
affordable infill housing as well as mixed-use development that
includes housing close to transit, within urbanized areas, and to
attract and add employment to areas that lack a sufficient employment
base.



50542.  It is the intent of the Legislature in enacting this
chapter:
   (a) To develop an incentive-based strategy to encourage the
construction of housing in those areas of the state that over the
last decade have experienced the greatest increase in job growth but
have not kept pace with necessary housing. This may include the
construction of infill housing and transit-oriented development that
includes housing, within existing urbanized areas.
   (b) To attract new business and new jobs to areas that lack a
sufficient employment base in relation to the housing they already
provide.
   (c) To provide local governments with state funding to reward the
approval and construction of housing, particularly housing for
California's working class, in strategically defined areas.



50542.1.  (a) The Jobs-Housing Balance Improvement Account is hereby
created as a special fund in the State Treasury. All money in the
fund shall be available, upon appropriation by the Legislature, to
the Department of Housing and Community Development for the following
purposes:
   (1) To make grants to local agencies pursuant to Section 50543.
   (2) To make grants to cities, counties, and cities and counties
pursuant to Section 50544.
   (3) For transfer to the Rental Housing Construction Fund pursuant
to Sections 50543 and 50545.
   (4) For the related administrative expenses of the department.
   (b) There shall be paid into the fund, the following moneys:
   (1) Any moneys that may be made available by the Legislature for
the purposes of the fund.
   (2) Any other moneys that may be made available to the department
for the purposes of this chapter from any other source or sources.




50543.  (a) Five million dollars ($5,000,000) of the funds
appropriated for purposes of this chapter in Item 2240-114-0001 of
Section 2.00 of the Budget Act of 2000 shall be transferred to the
Rental Housing Construction Fund created pursuant to Section 50740 to
be used pursuant to subdivisions (b) and (c).
   (b) The department shall provide state grants to local agencies to
assist them in attracting new business and jobs in "housing rich"
communities that lack an adequate employment base to match the amount
and cost of housing in those communities.
   (c) A local agency that has completed an economic development
strategic plan may apply for a grant to create an economic
development strike team to assist the local agency in better
targeting and coordinating outreach to employers who may choose to
locate jobs within the community.
   (d) In order to be eligible for a grant pursuant to this section,
a local agency shall have an adopted housing element that the
department has determined pursuant to Section 65585 of the Government
Code to be in substantial compliance with the requirements of
Article 10.6 (commencing with Section 65580) of Chapter 3 of Division
1 of Title 7 of the Government Code.
   (e) The department shall establish maximum grant amounts and
establish an appropriate process for evaluating need and making grant
awards.
   (f) No later than December 31, 2002, the department shall provide
an interim report to the Legislature indicating the progress of the
program established by this section, including the number of
jurisdictions accessing the program. No later than December 31, 2005,
the department shall provide a final report with updates to the data
contained in the interim report and a description of the
achievements by local agencies participating in the program.



50544.  (a) One hundred million dollars ($100,000,000) of the funds
transferred for purposes of this chapter in Item 2240-114-0001 of the
Budget Act of 2000, any funds transferred in Item 2240-114-0001 and
appropriated pursuant to Item 2240-114-3006 in the Budget Act of
2001, and any funds appropriated thereafter for the purposes of this
section shall be used to award incentive grants to cities, counties,
and city and counties to be used for any project, service, or other
local need determined by the city, county, or city and county to be
in the community's best interest. Grants shall be provided through a
grant agreement that requires the recipient to provide to the
department a report on the number of residential building permits
issued during the reporting period, the number of certificates of
occupancy issued for those units, and the services provided or
amenities purchased or built. The department may operate this program
through at least one annual allocation. In addition, because housing
production may be affected by economic factors during the course of
any allocation year, the department may, if it deems necessary,
reasonably adjust incentive criteria to meet the intent of this
section and allow funding to remain available for subsequent annual
funding cycles upon expenditure authorization by the Legislature.
   (b) To be eligible for a grant pursuant to this section, a local
government shall do both of the following:
   (1) By the end of the calendar year in which unit production is to
be counted (hereafter referred to as "allocation reporting year"),
have an adopted housing element that the department has determined
pursuant to Section 65585 of the Government Code to be in substantial
compliance with the requirements of Article 10.6 (commencing with
Section 65580) of Chapter 3 of Division 1 of Title 7 of the
Government Code.
   (2) Have a demonstrable and significant increase in the issuance
of residential building permits issued between January 1 and December
31 of the allocation reporting year over the average number of
building permits issued annually for the most recent 36-month period
that can be calculated prior to the allocation reporting year. This
calculation shall be adjusted for incorporations and annexations. The
department shall establish a benchmark level to be achieved in order
to establish eligibility for funding based on criteria including a
survey of economic forecasts to be conducted by the Department of
Finance no later than November 30 of the year prior to the reporting
year for any year in which the program is to be operated.
   (c) Grant amounts shall be determined as a per-unit incentive
weighted for high, medium, and low employment demand areas. In
addition, the department shall provide additional incentives for
units in projects within eligible communities that meet criteria
designed to encourage planning priorities such as affordability,
multifamily housing, and infill development. The department shall
establish the definitions and measurement specifications for the
incentive criteria to be used to determine grant amounts that are
easily and objectively verifiable.
   (d) Funding shall be provided as soon after January 1 of the year
following the allocation reporting year, as is reasonably possible,
allowing time for receipt by the Department of Finance of yearend
production figures as well as other information necessary to apply
the established criteria. If all funds are not expended after the end
of the calendar year in which housing production is counted, the
department may continue the program into the following year if it
determines there are adequate appropriated funds to administer the
program. If residential production within eligible jurisdictions
exceeds the department's projections, per-unit incentives shall be
prorated within the appropriated funding amount.
   (e) The department shall solicit and consider comments from
interested parties on the criteria that shall be used for determining
the amount of funds granted per unit. The department may deny
funding to any jurisdiction that it determines, based on reasonable
evidence, failed to issue residential building permits on a timely
basis between the effective date of this chapter and January 1, 2001,
or, where the department determines, upon reasonable evidence, that
the jurisdiction inappropriately withheld the issuance of building
permits so that it could be counted in a subsequent allocation
reporting year.
   (f) No later than December 31, 2002, and on December 31 of each
subsequent year in which funds are expended, the department shall
provide an interim report to the Legislature indicating the benchmark
levels of production established, the number of jurisdictions
accessing the program, the number of residential units building
permits issued above the established benchmark, and the success of
the additional incentives in achieving state housing policies. When
all funds have been expended, the department shall provide a final
report with updates to the data contained in the previous reports, a
description of the achievements and expenditures by local governments
through the program and information regarding the number of
certificates of occupancy issued in relation to the residential
building permits issued. The report shall be issued within twelve
months following the final allocation of funds.



50545.  Five million dollars ($5,000,000) of the funds appropriated
for the purposes of this chapter in Item 2240-114-0001 of the Budget
Act of 2000 shall be transferred to the Rental Housing Construction
Fund created pursuant to Section 50740 to be used for predevelopment
loans pursuant to Chapter 3.5 (commencing with Section 50530),
subject to the following provisions:
   (a) All projects shall be located within one-half mile of an
existing or planned transit station proposed for development. For
these purposes, a transit station is a site where two or more mass
transit modes, or one transit mode with three or more mass transit
lines, are accessible to the public.
   (b) Notwithstanding any other provision of law, the department may
establish interest rates between 3 and 7 percent based on the
department's analysis of project need.
   (c) In addition to the activities eligible under the
Predevelopment Loan Program, funds awarded pursuant to this section
may be used for master environmental impact reports or other
environmental documents that would access potential impacts in
advance and propose measures to mitigate negative impacts.
   (d) Awards made pursuant to this section shall require a 50
percent match from the local agency in which the site is located.
   (e) In addition to those eligible sponsors specified in
subdivision (e) of Section 50530.5, eligible sponsors shall include
limited liability companies and limited partnerships where all
managing members or general partners are nonprofit organizations.




50546.  (a) The administrative expenses of the department shall not
exceed 3 percent of the amount available for the purposes of this
chapter.
   (b) The department may administer the programs set forth in this
chapter pursuant to guidelines that shall not be subject to the
requirements of Chapter 3.5 (commencing with Section 11340) of
Division 3 of Title 2 of the Government Code.