ProHousing Designation Program
In the 2019-2020 Budget Act, the legislature enacted the ProHousing Designation Program. The program comes as a response to California’s housing crisis and lack of affordable housing and provides an avenue for jurisdictions to be designated as “ProHousing.” A jurisdiction designated as ProHousing is given preference when participating in various state funded programs related to housing and development and is eligible to apply for grant funding from the ProHousing Incentive Program. Generally, jurisdictions demonstrating policies and planning designed to accelerate the production of housing are eligible for designation.
As a result of the act, the California Department of Housing and Community Development (“HCD”) was tasked with developing ProHousing Designation Program guidelines in an effort to assist local governments in adoption of policies that would allow them to qualify for the program. The HCD has established an objective point-based system to determine whether a jurisdiction qualifies as ProHousing. Jurisdictions are awarded points based on a rubric of policies. If an applicant jurisdiction has development standards or regulations consistent with a policy, it will receive a set number of points attributable for that policy.
The point system is based in four different policy categories. The first category is “Favorable Zoning and Land Use” and includes policies such as “Sufficient sites… to accommodate 150 percent or greater of the current or draft RHNA.” The goals in this category mostly focus on securing more housing in a jurisdiction, particularly affordable and midrange housing.
The second category is “Acceleration of Housing Production Timelines” which includes policies such as, “Establishment of streamlined… CEQA analysis and certification of general plans, community plans, specific plans with accompanying Environmental Impact Reports.” The goals in this category are focused on streamlining entitlement processes by creating more objective standards and simplifying application processes.
The third policy category is “Reduction of Constriction and Development Goals” policies under this category include, “Promoting innovative housing types…that reduce development costs.” Objectives in this category are focused primarily on any changes that may reduce costs to developers such as less restrictive design standards, pre-approved plans, or other fee reduction strategies.
Finally, the fourth and final category is “Providing Financial Subsidies” with policies such as, “Establishment of an Enhanced Infrastructure Financing District or similar tool that…directly supports housing developments in an area where at least 20 percent of the residences will be affordable to lower income households.” The policies in this category are mainly concerned with establishing loans, trusts, and financing tools that will result in subsidizing the costs associated with construction for affordable housing.
The following jurisdictions have earned ProHousing Designation as of this writing:
Jurisdictions designated as ProHousing receive several benefits for their designation. First, local governments that are designated are eligible to apply for new Prohousing Incentive Program grant funding, which is a $26 million state investment from the Building Homes and Jobs Trust Fund. Additionally, designated local governments may receive priority processing or funding points when applying for several funding programs including Affordable Housing & Sustainable Communities; Infill Infrastructure Grant; and Transformative Climate Communities, among others. HCD has also affirmed that it is likely that more programs and benefits may be added as the HCD engages with stakeholders and partner agencies.
While ProHousing Designated jurisdictions do not necessarily confer direct benefits on housing developers operating within those jurisdictions, it is important to note that if a jurisdiction is designated, it is likely that many entitlements and review processes for housing will be streamlined and often ministerial in nature, making environmental review and development a smoother process in those jurisdictions.
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David Temblador is a Partner and Sabrina Barr is an Associate at Harrison, Temblador, Hungerford & Guernsey LLP in Sacramento, California.
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