1127 11TH STREET, SUITE 300, SACRAMENTO, CA 95814 • 916.974.9270 • PUBLICPOLICYGROUP.COM PAGE 1 Date: January 9, 2026
To: Christian Clegg, City Manager
City of Bakersfield
From: Sharon Gonsalves
Managing Director
California Public Policy Group
Re: CPPG Summary of Housing Informational Hearing on January 7, 2026
On January 7, the Assembly Select Committee on Housing Construction Innovation held its first informational hearing. The Committee—chaired by Assemblymember Buffy Wicks (D -Oakland)—is a new committee formed to “determine how the State can play a role in reducing housing costs by facilitating innovation in housing construction.” The Committee’s purpose statement can be found here. Informational hearings are intended solely to gather information and do not involve any votes.
Their purpose is to allow the Legislature to explore a specific subject area to be better prepared when considering related legislation. While no formal actions are taken during oversight hearings, comments from committee members and testimony from witnesses can offer valuable insight into potential legislation the Legislature may pursue in the future.
The January 7 hearing focused on identifying construction methods that can reduce housing costs in California without increasing costs to taxpayers. The chair framed the discussion around scaling innovative approaches that can be deployed statewide to address the housing affordability crisis.
Committee members highlighted several promising models. Assemblymember Sharon Quirk -Silva (D-Fullerton) pointed to Sweden’s housing construction system and a very low -income modular project in El Monte using a durable foam “Yeti” design. Assemblymember Juan Carrillo (D-Palmdale) emphasized the importance of supporting small -scale manufactured -home developers, while Assemblymember John Harabedian (D-Pasadena) stressed the need for a stable and predictable market for innovative builders. Assemblymember Jeff Gonzalez (R-Indio) highlighted public health benefits associated with producing homes in climate -controlled factories, and Assemblymember Lori Wilson (D-Suisun City) focused on how the state can enable innovation while maintaining cost effectiveness.
Ben Metcalf of the University of California, Berkeley’s Terner Center identified California’s central challenge as exceptionally high and rapidly rising construction costs. He noted that multifamily development costs often exceed $500,000 per unit before land costs and have outpaced inflation for decades, acceler ating since 2019. Metcalf also cited a shrinking construction workforce and long-term productivity declines. Factory -based construction methods —including manufactured and modular housing—can reduce hard construction costs by roughly 10% –20%, but face barriers including earlier financing needs, codes and approvals designed for site -built housing, uncertain demand that conflicts with factory staffing models, and a fragmented industry with limited research and testing capacity.
Industry testimony reinforced both the promise and constraints of innovative construction. Caleb Roope of The Pacific Companies reported delivering more than 26,000 homes and 6,700 modular
1127 11TH STREET, SUITE 300, SACRAMENTO, CA 95814 • 916.974.9270 • PUBLICPOLICYGROUP.COM PAGE 2 units, achieving approximately 20% cost savings and 25% faster timelines. Other witnesses cited real-world cost reductions ranging from 10% to 35% using modular, manufactured, mass timber, and 3D-printed construction. Speakers warned that a declining construction workforce will continue to push costs upward. While factory-built housing offers meaningful efficiencies, roughly two-thirds of total housing development costs still occur on -site. Nearly all witnesses identified labor costs, financing, and local b uilding codes as major barrier s to scaling innovative construction methods statewide.
The overall tone of the Select Committee aligned with the Governor’s State of the State on January 8, during which the Governor stressed the need for rapid and affordable construction of housing across the state.
The agenda for the informational hearing can be found here.