STAFF REPORT
DATE: February 15, 2022
TO: Justin Hess, City Manager
FROM: Patrick Prescott, Community Development Director VIA: Simone McFarland, Assistant Community Development Director BY: Maribel Leyland, Housing Authority Manager
SUBJECT: Support Proposed State Legislation to Create the Burbank Glendale Pasadena Regional Housing Trust; a Joint Powers Authority to Generate New Affordable Housing Funding
RECOMMENDATION
1. Support Proposed State Legislation to create the Burbank Glendale Pasadena Regional Housing Trust, a Joint Powers Authority, and authorize staff to work with the office of State Senator Anthony J. Portantino on the proposed legislation; and
2. Support a State budget funding request to provide initial funding for the Burbank Glendale Pasadena Regional Housing Trust.
BACKGROUND
Staff from the cities of Burbank , Glendale, and Pasadena have discussed a proposed Regional Housing Trust for the tri-city area modeled after the San Gabriel Valley Regional Housing Trust (SGVRHT).1 A local housing trust is a tool to coordinate and receive funds for the creation of affordable housing. The key characteristic of a local housing trust is that it can receive revenues to fund the proposed program. In this case, the proposed trust would apply for/request funds to help finance affordable housing in the tri-city area.
Senator Portantino is considering introducing legislation to allow the cities of Burbank, Glendale, and Pasadena to enter into a joint powers agreement to create the trust to receive available public and private funds for this purpose.
1 The SGVRHT was formed in February 2020, as authorized by SB 751 (Rubio). The legislation allowed the participating San Gabriel Valley cities to join together to bring additional affordable housing resources to the San Gabriel Valley region.
COMMUNITY
DEVELOPMENT
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The proposed legislation aligns with o ne of the Burbank City Council goals , which is to address the issues and opportunities related to Housing and Homelessness facing the Burbank community. The City of Burbank's Legislative Platform outlines the City's position on housing legislation and opportunities that would promote the City’s interests and preserve local control and local legislative authority including: “Accessible Housing Affordable at All Income Levels - Support legislation and programs that assist in providing housing at all income levels, including extremely -low and very -low income households within mixed -income residential developments in the Ci ty, along with the supportive services necessary for households to sustain their housing.” Governor Gavin Newsom’s upcoming budget projects a surplus of $20.6 billion in discretionary spending this coming fiscal cycle . With an expected surplus, there is an opportunity for the cities of Burbank, Glendale, and Pasadena to join together to form a Regional Housing Trust by creating a Joint Powers Authority (JPA) to request that funds from this surplus are allocated directly to our region for affordable housing during the budget process .2 Furthermore, there are additional funding sources available and dedicated specifically for Local Regional Housing Trusts such as the Local Housing Trust Fund (LHTF) Prog ram administered by the California Department of Housing and Community Development (HCD) that are not available to cities or regions who have not formed a Trust.
This report briefly summarizes the proposed legislation and the next steps in the process should the proposed legislation and budget request be approved.
DISCUSSION
PROPOSED REGIONAL HOUSING TRUST LEGISLATION
Senator Portantino plans to introduce proposed legislation that would allow the cities of Burbank, Glendale, and Pasadena to form a Regional Housing Trust Fund structured as a Joint Powers Authority (JPA) for the purpose of creating or preserving affordable housing. The establishment of the Burbank Glendale Pasadena Regional Housing Trust would allow the receipt of available public and private funds to help finance affordable housing projects for homeless , extremely-low, very -low, low, and moderate income populations.3 This trust would benefit not only the tri -city area, but would be a benefit to all of those in need within the County of Los Angeles, as well , by creating additional housing units for the region.
Currently, there are nearly three thousand affordable housing units in the combined development pipeline for the three cities including permanent supportive housing, senior housing, missing middle housing, and affordable homeownership units. In some instances, there is not sufficient funding to br ing all pipeline affordable housing projects to completion; or to continue to grow the pipeline to meet the affordable housing need. In Burbank, there are close to 525 affordable housing units in the pipeline. H owever, that figure does not meet the need in our community. Additional affordable housing options
2 The state budget process is separate but simultaneous with the proposed bill. 3 Private funds could include, as an example, foundation funds, donations or major employer monies to create affordable housing. 3 | Page
are required for our extremely -low, very -low, low, and moderate- income households; including ownership housing options.
Under the proposed legislation, the Burbank Glendale Pasadena Regional Housing Trust would be able to request and receive state funding allocations, as well as authorize and issue bonds to help finance affordable housing projects for extremely-low, very-low, low, and moderate- income households. This mechanism has the potential to generate significant amounts of funding that could be utilized to address the local affordable housing crisis. If approved, there are several points of negotiation that would need to be addressed and finalized specific to the Burbank Glendale Pasadena Regional Housing Trust as summarized in the next section.
FUTURE REGIONAL HOUSING TRUST/JPA NEGOTIATION POINTS
If legislation and funding are approved, there are several areas to be negotiated. 4This is
not an all-inclusive list. Additional negotiation points may be identified during the formation process (Attachment 1). These include:
1. Self-Sufficiency of Regional Housing Trust
2. Fair Share of Funds to each City
3. Criteria for Distributing Funds
4. Program Management and Staffing
5. Dissolution Process and Other Legal Requirements
In summary, it will take several months and likely the services of a consultant who would be funded through the initial funding allocation, to help the cities of Burbank, Glendale , and Pasadena develop the Housing Trust Fund Program including determining program management and advisory bodies. Staff will return with updates to the City Council throughout the process.
PROCESS AND NEXT STEPS
The proposed bill language would need to be introduced by February 19, 2022 (legislative deadline). An alternative is to introduce a spot bill by the same deadline. A spot bill acts as a placeholder that signifies more information is coming. The final language for a spot bill would need to be introduced by March 19, 2022 . Senator Portantino has expressed the desire to introduce bill language that allows the cities of Burbank , Glendale, and Pasadena the authority to negotiate the details of the JPA as outlined in Attachment 1 if/ when the legislation passes (Attachment 2).
The following is a summary of key issues identified to date and the next steps.
1. Redistricting - Staff has been informed that the California State Senate Redistricting will not impact Senator Portantino’s sponsorship of the proposed legislation and the initial budget request and appropriation. Future appropriations from state surplus funds may be impacted; however, the policies and procedures of the JPA will outline the funding sources that will be sought.
4 The budget request is a separate but simultaneous process with the proposed Bill authorizing the formation of the Burbank Glendale Pasadena Regional Housing Trust.
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2. Proposed Bill Language – Senator Portantino’s office has drafted language for the proposed trust allowing the cities of Burbank , Glendale, and Pasadena the flexibility to negotiate the terms of the joint powers agreement as outlined in Attachment A.
3. Budget Appropriation - The proposed bill does not include the budget ask. That is a separate, but simultaneous process. Senator Portantino will make his ask in the coming months.
4. Affordable Housing Subcommittee – Staff presented the proposal to the Affordable Housing Subcommittee on February 1, 2022. The Subcommittee was supportive of the proposed regional housing trust and provided additional feedback a nd negotiation points that have been added to Attachment A for future discussion.
5. Pasadena and Glendale Meetings - Pasadena presented the proposal to their City Council on Monday, January 31, 2022. The Pasadena City Council unanimously supported the proposed legislation. Glendale is scheduled to present the proposal to their City Council on February 15, 2022.
Proposed Bill Timeline
February 19: Deadline to introduce proposed bill or spot bill.5 April – June: Proposed bill makes its way through appropriate committees and voting process.6
July: The Senate is in recess.
August – September: The bill will be voted on in the assembly and if passed, moves to the Governor desk.7
If the Governor signs the bill it goes into law January 1, 2023.
Budget Request Timeline:
January 10: Governor released his proposed budget.
February – March: Senator Portantino makes the budget ask.
Mar – May 2022: Budget Committees and May Revise to the January preliminary budget.
Mid-June to July 1: Legislature must send the budget to the Governor by June 15 th. Governor signs or vetoes budget/bills.
Information on a budget appropriation would not be available until at least June.
FISCAL IMPACT
Receiving the information contained in this report has no fiscal impact . If and when the legislation is passed and funds are appropriated to the proposed Burbank Glendale Pasadena Regional Housing Trust and JPA, any fiscal impacts to the City will be analyzed at that time.
5 A spot bill must also be introduced by February 19, 2022, and final bill language is required 30 days later by March 19, 2022. 6 The bill moves through the policy and fiscal committee process. It must pass the Senate by May 27th. The policy committees will look at the bill in June, Appropriations in July (before the recess) or more likely in August). 7 If the bill has been amended in the Assembly, it will need to go back to the Senate for a concurrence vote before going to the Governor. The deadline for the bill to go to the Governor is August 31.
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ENVIRONMENTAL REVIEW
The recommended actions to support proposed state legislation to create a JPA administered regional housing trust does not have the potential to cause a significant effect on th e environment and has been determined to be categorically exempt from environmental review pursuant to the California Environmental Quality Act (CEQA), State CEQA Guidelines Section 15320 (changes in organization of local agencies). This exemption applies whenever local governmental agencies are organizing and this organization does not change the geographical area in which previously existing powers are exercised, and include as an example, the creation of a s ubsidiary organization or consolidation of organizations having identical powers. The JPA envisioned falls under both of the exemption examples.
CONCLUSION
The Cities of Burbank, Glendale, and Pasadena have worked collaboratively in the past, sharing the goal of cooperatively addressing regional priorities and matters of mutual interest. The proposed Burbank Glendale Pasadena Regional Housing Trust is another vehicle to generate additional funding to this region. In addition, the trust would facilitate working collaboratively to develop more affordable housing for the tri-city area that would otherwise not be available.
ATTACHMENT
Attachment 1 – Proposed Burbank Glendale Pasadena Regional Housing Trust Summary and Future Negotiation Points
Attachment 2 – Draft Bill Excerpt Authorizing the Creation of the Burbank Glendale Pasadena Regional Housing Trust, a Joint Powers Authority