Overview of
The Proposed Affordable Housing,
Homelessness Solutions and Prevention
Now Transactions and Use Tax Ballot
Initiative
(This is a summary of key components of this proposed law, and does not reflect any opinion in favor of or against its adoption) Source: Notice of Intent to Circulate Initiative Petition for the Affordable Housing, Homelessness Solutions and Prevention Now Initiative Ordinance, Filed with the Clerk of the Board on November 6, 2023; LACAHSA Board Meeting Materials for Agenda Item 8 (December 14, 2023) (https://lacahsa.gov/content/uploads/2023/12/12-14-2023-LACAHSA-AGENDA.pdf); and, LACAHSA Board Meeting Materials for Agenda Item 5 (August 2, 2023) (https://file.lacounty.gov/SDSInter/bos/supdocs/08-02-2023LACAHSAAGENDA.pdf) As Presented by the Office of County Counsel,
County of Los Angeles
Proposed
Citizens’
Initiative
Ballot
Measure
• Proposed ballot measure to enact a ½ cent
transaction and use tax (“sale tax”) to fund
County homeless services and LACAHSA.
• Notice of Intent to Circulate Initiative Petition
filed with County Registrar-Recorder
November 6, 2023.
• Currently in signature gathering phase.
• If it garners sufficient valid signatures to qualify
for the ballot, the Board of Supervisor has until
August 9, 2024 to place it on the November 5,
2024 ballot.
• Requires majority approval of County voters at
the November 5, 2024 election.
Proposed
Funding
Source:
County Sales
Tax
• The proposed ½ cent County sales tax
would replace the existing ¼ cent
sales tax for homeless services (set to
expire in 2027) and also fund LACAHSA.
• AB 1679 exempted the County from the
2% cap on local sales tax, and by doing
so would allow this measure (if passed)
to be a ½ cent tax to fund both County
homeless services and LACAHSA.
LACAHSA’s
Proportional
Share
Would provide LACAHSA with 35.75
percent of this new sales tax, with
the remainder distributed to the
County of Los Angeles (61.25
percent) and to the Los Angeles
County Development Authority
(“LACDA”) (3 percent)
How Would
LACAHSA
Receive the
Funds?
• The Department of Tax and Fee
Administration (“DTFA”) disburses local tax
payments to all local jurisdictions three
times per quarter.
• DTFA would distribute these new tax funds
to the County at the same time DTFA
distributes the Bradley-Burns 1% Local
Sales and Use Tax (3 times per quarter).
• This distribution would occur through a
contract between the County and the
DTFA.
• Under this arrangement, the County
Auditor-Controller would then distribute
the allocation to the County, LACDA and
LACAHSA.
Who Would
Oversee
LACAHSA’s
Fund
Expenditure?
LACAHSA’s Citizens' Oversight Committee
(Government Code section 64718) would
oversee LACAHSA’s use of the tax proceeds:
LACAHSA Action Items:
✓LACAHSA appoints an Inspector General (IG)
(Government Code section 64711.4(c)).
✓The IG selects Oversight Committee
Members (Government Code section
64718(c)).
✓An annual expenditure plan is developed,
then approved by the Oversight Committee,
and then adopted by the LACAHSA Board
(Government Code section 64717(c)).
Collection of tax proceeds should begin on
April 1, 2025.
Fund Purpose
Solely for the purposes of preventing
homelessness, reducing homelessness and
making housing more affordable in Los Angeles
County. Here are the limitations:
✓Any lawful purpose of LACAHSA
✓Programs and services that support physical
and mental health care, emergency housing,
permanent housing, job counseling,
substance use disorder treatment, short-term
rental subsidies, and related services
✓Construction of affordable housing by LACDA
✓Data collection and analysis to evaluate the
effectiveness of programs funded by this new
tax
✓County reimbursements for its reasonable
costs to collect and distribute this new tax
Use of
LACAHSA’s
Allocable
Share
• Funds allocated to LACAHSA can only be used
for Affordable Housing and Prevention,
consistent with LACAHSA’s implementing
statute (Government Code section 64700 et
seq.), which includes:
✓New affordable housing construction
✓Affordable housing preservation
✓Tenant protection and support programs
✓Planning and technical assistance related
to affordable housing and land use,
including reducing barriers to affordable
housing and accelerating production and
preservation
✓All other purposes set out in the LACAHSA
annual expenditure plan
How Ballot
Measure
Would Alter
LACAHSA’s
Use of its
Allocable
Share
• For the first 10 years: Of the 35.75 percent tax
increment received (assumed gross estimate
is approx. $446,875,000 out of an assumed
$1.25 Billion of revenue), at least 60 percent
(approx. $268,125,000) must be used for
affordable housing creation, preservation and
ownership, and of this 60 percent allocation,
77.25 percent (approx. $207,126,562) must
be used for construction of new affordable
housing. Otherwise, minimum distributions to
eligible jurisdictions in Government Code
section 64830 apply.
• After 10 years, at least 40 percent must be
used for affordable housing creation,
preservation and ownership consistent with
the minimums in Government Code section
64830.
Construction
Provisions
Applicable to
LACAHSA
• 80 percent of the housing units
produced (construction or rehab) must
be produced under a Project Labor
Agreement.
• Any construction or rehab work funded
or financed with these tax funds is
considered a public work and subject to
prevailing wage requirements (Labor
Code section 1720 et seq).
LACAHSA’s
Responsibilities
• Handle these funds in accordance with LACAHSA’s
implementing statute and applicable laws (Government Code section 64700 et seq.)
• LACAHSA Goals focus:
✓ Prevent people from falling into homelessness
✓ Increase the number of affordable housing units in Los Angeles County
• Evaluate (quantify) program success using key system
performance metrics, including but not limited to:
✓ Creating a standardization of basic services to bring people inside and ensure they have access to necessary
services
✓ Establishing a homeless-service-delivery system more
accessible to al communities
✓ Meeting regional housing needs for Lower Income
Households
✓ Using an equity lens, reducing racial disparities and the disproportionate impact of homelessness and housing
insecurity for critical populations
✓ Increasing accountability and transparency as to the use of public funds
To evaluate program success, take a look at:
✓ Met and unmet goals
✓ Identify existing programs that are highly effective
✓ Identify how to achieve goals
✓ Identify the consequences for not meeting goals
Important
Due Dates
By April 1, 2025:
• LACAHSA would formulate baseline
and target metrics based on input and
recommendations from stakeholders
and others, including service providers,
affordable housing developers and
renter protection organizations.
• LACAHSA would use the baseline
metrics to demonstrate program
progress.
Important
Due Dates
Annual Report Due by October 1 (starting in 2025):
• As a funding recipient, LACAHSA would forward an
annual report to the County’s CEO identifying:
✓Amount of tax collected and spent in the prior
fiscal year.
✓Status of any projects or work funded by tax
proceeds
✓Any funds carried over from prior years and to be
carried over to future years.
• These reports would be public records and would be
posted on the LACAHSA website. LACAHSA would
retain the report for 5 years from date of
completion.
• Each year, the Auditor-Controller would use these
reports (submitted by LACAHSA, LACDA, County and
other funding recipients) to prepare a report on all
receipts and expenditures in the prior fiscal year for
the Board of Supervisors and LACAHSA.
Important
Due Dates
Annual Audits (covering FY2025, starts
in early 2026):
• Each year, the Auditor-Controller would
audit all tax receipts and expenditures
(including LACAHSA records) per the
Single Audit Act (31 U.S.C. Chapter 7).
• These audit reports would be public
records and would be posted on the
LACAHSA website. LACAHSA would
retain the audit for 5 years from date of
completion.
Important
Due Dates
By December 31, 2030:
• For every goal for which a target metric is not
achieved by December 31, 2030, LACAHSA might
receive recommendations from the Executive
Committee to redirect funds to other programs.
• The Executive Committee (established on August
8, 2023 by the County Board of Supervisors) is
composed of:
✓ Two Board of Supervisors members
✓ The City of Los Angeles Mayor
✓ The Los Angeles City Council President
✓ Four City members (either a Mayor or City Council
member) from the North County and San Fernando
Valley sector, the Southwest Corridor sector, the
San Gabriel Valley sector, and the Southeast sector
One Governor appointee
• Under the proposed ordinance, the Executive
Committee is the County’s equivalent of
LACAHSA’s Citizens’ Oversight Committee.
Important
Due Dates
By October 1, 2031:
• With the Executive Committee,
LACAHSA would formulate new
baseline and target metrics.
✓And every 5 years thereafter:
➢The Executive Committee
would evaluate program
progress towards these new
metrics and forward
recommendations to
LACAHSA and the County.
QUESTIONS?