For a more in depth discussion of Proposition 1, and the ten other initiatives on the ballot this November, join us for the California Initiative Review Forum in the Lecture Hall at McGeorge School of Law on October 24 from 5:30 – 7:30pm. Details on the event here.

Proposition 1: Veterans and Affordable Housing Bond Act of 2018

Current Law                                                                                                                             

  • The Housing and Emergency Shelter Trust Fund Acts of 2002 and 2006 were passed by voters to provide a total of $4.95 billion in state bonds to fund various housing programs.
  • The Veterans’ Farm and Home Purchase Act of 1974 provides veterans with the opportunity to acquire farms and homes. The program has been partly financed through state bonds.

Proposed Law

  • Proposition 1 will authorize 4 billion in bond funding for existing affordable housing programs and for the veterans home loan program.
  • The cost of the affordable housing bonds to the State would be about $170 million annually for 35 years. No direct costs to the State for the veterans housing bond.

Proposition 1 Bond Fund Allocation

Program Purpose Amount
Affordable Multifamily Housing

  • Multifamily Housing Program
  • Local Housing Trust Matching Grant
Construct and renovate affordable housing, including rental housing for lower income households. $1.8 billion
Development

  • Transit-Oriented Development
  • Infill Incentive Grant
Construct housing in urbanized infill areas and near public transportation. Improve infrastructure such as parks, water, sewer, and transit in infill areas. $450 million
Home Ownership

  • Home Purchase Assistance Program
  • Self-Help Housing Program
Assist low- and moderate-income homebuyers to build or purchase homes, including mobile homes. $450 million
Farmworker Housing Construction or rehabilitation of rental or owner-occupied housing for farmworkers. $300 million
Veterans Home Loan Finance farm, home, and mobile home purchase assistance for veterans. $1 billion

Policy Considerations

Yes on Proposition 1 No on Proposition 1
  • There is an extreme housing shortage with 2.2 million low income renter households competing for 664,000 affordable rental homes.
  • $1 billion will be dedicated to providing affordable housing to veterans.
  • Prop. 1 will create 137,000 new jobs and pump $23.4 billion into California’s economy.
  • California already has $74.2 billion in debt from general obligation bonds.
  • 1 will only lead to 15,000 affordable housing units being built at $300,000 per unit.
  • Prop. 1 does not require periodic audits to ensure the money is being spent in accordance with the initiative’s intent.

Analysis of Proposition 1 provided by John Ponce and Henry Mantel.

 

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