California is one of the nation's largest and most populous states. The State's population has been growing at twice the national average, creating complex and dynamic urban environments. California possesses a resilient economy comprised of industry and services, such as: agriculture and forestry, entertainment, tourism, hardware and software computer technology, government, finance, real estate and foreign trade. To meet future demands, the State must guide its communities in community planning that responds to the growing demand for affordable housing, neighborhood revitalization and economic development.
The State of California's 1995 Consolidated Plan presents a strategic vision for housing and community development. It includes a One-Year Action Plan for spending approximately $90 million of Community Development Block Grant (CDBG), HOME Investment Partnership Program, Emergency Shelter Grant and Housing Opportunities for Persons with AIDS funds. These funds will primarily be spent on affordable housing and neighborhood revitalization activities, which principally include housing rehabilitation, first-time homebuyer assistance, new construction, public infrastructure improvements and economic development initiatives.
The State held several public meetings to discuss the Consolidated Plan and
the consolidated planning process. Attendees included public and private
organizations and individuals. Discussions were centered on community needs,
strategies and action plans to address the needs. At each meeting, copies of a
draft Consolidated Plan were distributed to elicit public review and comment.
The State considered all oral and written public comments received in preparing
its final Consolidated Plan. The Plan was approved and adopted on May 12, 1995.
Historically California has been one of the fastest growing states in the nation. However, the growth rate will decline somewhat in the 1990s and over the next two decades. Although growth will subside, the number of households will increase because of a projected decrease in size of each household. Another a major factor influencing the demand for housing is the age of the adult population. The oldest and youngest residents are likely to live alone and in small units, while the middle-aged are in the midst of raising families and need larger units. By the year 2020, the 65-69 year-old "baby boomers" will be the dominant age-cohort in the housing market, demanding yet another change in housing size.
California's Hispanic and Asian populations will grow faster than the rest
of the population. During the 1990s the Hispanic population will increase from
19.2 percent to 25.8 percent of the State's population. Non-Hispanic "Asian
and Other" are projected to increase from 6.7 percent to 11.7 percent of
the population. Proportionally, the non-Hispanic black population will decrease
slightly from 7.1 percent to 6.4 percent, while the share of non- Hispanic white
population is expected to substantially decrease: from 66.6 percent in the 1980s
to 57.4 percent in the 1990s.
California is a geographically diverse state, spanning from the Mexican boarder to the state of Oregon. As a result, the State's housing and community development needs vary greatly by location. The State uses a competitive process to allocate its HUD resources, i.e., CDBG and HOME funds, to small cities and counties in both rural and urban areas that do not receive direct entitlements. In addition, the State fosters local government efforts to address housing needs by requiring all cities and counties to have a housing element in their general plan that guides residential development and directs public investment.
Critical housing needs identified in the Consolidated Plan are: the needs of low-income renters, the needs of low-income homeowners, and the needs of homeless persons and persons with supportive housing needs. Each of these groups are affected by: overcrowded conditions, an inadequate supply of standard housing and housing affordability issues. Very low income elderly and family renters have particularly high unmet housing needs. Renters are a higher need group than owners in both total numbers and the percentage of households experiencing housing problems. Hispanics have a disproportionate level of overcrowding conditions. Homeless families and persons with special needs have the next highest priority needs -- for all phases of the continuum of care services.
The State must conserve and rehabilitate its aging housing stock and provide new housing to meet the demand of increasing households and changing household sizes. Over the last two decades, increases in housing values (746%) and rents (392%) have increased faster than household incomes (285%). More than two million low-income households pay more than 30 percent of their income for housing.
Non-housing community development (NHCD) needs follow. Due to the competitive nature of the State's application process and unique local needs, NHCD activities are typically economic development projects. These activities are described as public facilities and infrastructure improvements, improved sewer and water systems, economic development loan programs and economic development technical assistance and planning activities.
As of January 1990, California had 11,182,882 housing units; Fifty-five percent, or 7,476,000, of these are single-family detached units. The balance of is made up of 3,706,882 attached or multifamily units (45.3 percent). Fifty-six percent of the State' 10.4 million households are owner-occupied. Forty-four percent, or 4,607,263 units, are occupied by renters. Although still the predominate housing type, the share of single-family detached units has dropped significantly (10 percent) in terms of the overall housing supply since 1970. Renters more commonly occupy older housing units. Fifty-five percent of California's housing stock is at least 20 years old.
Apartments, townhouses and condominiums are growing market segments. These units tend to be smaller and be lower priced than the median cost for single-family housing. This trend is consistent with the long-term need to reduce the gap between housing costs and incomes throughout the State.
Affordability is the most widespread housing problem in California. More than two million households have unaffordable housing costs, dominated by those who rent housing and have the lowest incomes. Moreover, both owner-occupied housing costs and rents have increased faster than income in the last two decades.
And in the last several years, fewer multifamily units have been produced, which will continue to put pressure on rents that are likely to rise faster than incomes. Low- and moderate-income renters need rental assistance. For those who own or desire to own a home, assistance is also needed, such as rehabilitation assistance or first-time homebuyer assistance.
Crude estimates of homeless persons in California range from 150,000 to 300,000 on any given day. Single men greatly outnumber women, and women with children are the most common family type. Thirty to 40 percent are mentally ill. Ten to 20 percent have alcohol or drug problems. In addition to shelter, food and a stable source of income, the special needs of the homeless are: counseling, child care, employment assistance, heath care, mental health care, money management, transitional housing -- with case work, education and training, and referrals to public and private agencies. A critical need exists for permanent supportive housing environments for homeless and non-homeless with special needs, such as the frail elderly, persons with disabilities, and persons with HIV/AIDS.
The State of California has no public housing authority.
Lack of affordable housing is the most widespread housing problem in the State. The State acknowledges that tax policies, public referenda for public housing, rent control, impact fees, building codes, and land use controls affect affordable housing development. In Sacramento County, development regulation was estimated to add $26,000 to the cost of a new home, or 20 percent of the median sales price of $131,000 in 1989. Residential land-use regulation is the most relevant and State-influenced public policy affecting affordability; however, the authority to regulate land use has been largely delegated to local control. Through a substantial number of statutory provisions applicable to local governments, including the Housing Element and a new program, Building Equity and Growth in Neighborhoods (BEGIN), the State works to reduce barriers and increase affordable housing development. Moreover, housing affordability has been found, among other concerns, to be detrimental to the State's business and employment growth. As a result, increased efforts to simplify and streamline planning and permitting are underway.
There are no current court orders, consent decrees, or HUD-imposed sanctions that affect the provision of fair housing remedies by the State.
It has been estimated that 2,027,722 low-income housing units contain lead-based paint hazards, 80 percent of which are occupied by renters. In 1991, fifty percent of 211,000 children tested in the Los Angeles County area were found to have elevated blood levels. The State is aggressively pursuing the abatement and mitigation of lead-based paint hazards through screening, case management and educational programs. Furthermore, State housing programs include requirements that address and abate the hazards of lead-based paint.
The State's sole source for addressing non-housing community development (NHCD) is CDBG funds. Areas of NHCD needs have been identified as: planning; public works and infrastructure such as, improved sewer and water systems; technical assistance to increase local or nonprofit capacity; credit to finance business expansion; a fostering of microenterprise and macro economic development; and, other services associated with the development of human capital, such as gainful employment for the at-risk population, adult education and vocational training programs, self-sufficiency programs and intensive case management, affordable child care and educational pre-school programs, retraining for displaced workers, emergency assistance for at-risk families and individuals, and infrastructure and accessible transportation improvements.
The Consolidated Plan process has increased coordination among State
agencies and departments; e.g., the Department of Housing and Community
Development (HCD), responsible for the CDBG and HOME programs; the California
Housing Finance Agency (CHFA); the Department of Economic Opportunity (DEO);
and, the Department of Health Services (DHS). The DEO leads the State's
homeless response. The DHS will administer the HOPWA funds. The State also
coordinates a Working Group, comprised of a variety of participants, who
together discuss anti-poverty issues and funding resources. The State has also
increased its contact with private and nonprofit agencies that work in the
housing and economic development fields.
The State's strategy to reduce the negative effects of relevant public policies include a broad array of policies and programs facilitating the development of new housing, preservation of existing housing and neighborhoods, and reduction of housing costs.
The State's five-year strategy describes a series of general responses to the housing and NHCD needs. However, specific strategies will be developed by the local jurisdictions that apply for assistance through the State's competitive application process. The State's housing strategies are intended to guide jurisdictions in developing housing projects that serve low- and moderate-income family households, special needs groups, families in danger of homelessness and first-time home buyers. Non-housing strategies are intended to guide jurisdictions and recipients in accomplishing economic diversification, job creation, improved public infrastructure and facilities and the implementation of anti-poverty strategies that include microenterprise development.
The State's housing strategy will focus on three primary objectives: low-income renters' needs, low-income homeowners' needs, and the needs of the homeless and households requiring supportive services. The State relies on local governments and community organizations to identify the most pressing local needs and to determine the most effective approach to addressing those needs. Therefore, actions described by the State in its Consolidated Plan are broad, largely due to the method of distribution of its resources via a competitive application process. To be competitive, each recipient must provide detailed strategies and action plans that are consistent with the State's overall strategies.
Priorities for affordable housing include increasing the supply of affordable housing, reducing housing cost burdens for low-income households, improving the living environments of low- income residents, increasing housing choice for low-income and minority residents, and, addressing the unique needs of large families, the elderly, and persons with disabilities. The State's housing priorities and strategies reflect those conditions and focus on maintaining and increasing the supply of affordable housing. The State's Consolidated Plan also includes strategies for addressing the need for permanent farm-worker housing and housing located in Colonias.
The State will continue to support an extensive system of services that provide institutional care, client-based community or residential services, and housing-based supportive services. The State will coordinate the activities of service and housing providers at all levels of government and among nonprofit and community organizations. The underlying State goal is to promote self-sufficiency and facilitate a provision of transitional and permanent housing. The priority for non-homeless persons with special needs is supportive housing or housing linked to supportive services for the frail elderly, disabled persons with HIV/AIDS, and other persons with special needs.
A substantial portion (30 percent) of the State's CDBG funds are allocated to NHCD priorities and activities. Two models are used to carry out economic development initiatives: the Enterprise Fund, which provides funds to carry out locally revolving loan programs; and, the Over the Counter Fund, which provides funding for specific one-time projects. Each program is designed to bring needed services to neighborhoods or create or retain jobs, principally for low- and moderate-income persons. CDBG funded planning and technical assistance grants will also be awarded to jurisdictions in need of building capacity, planning for public improvements and in desire of expanding economic opportunities for low-income persons.
The State's antipoverty strategy is to increase income above the poverty level. Several State Departments administer programs that allocate resources to break the cycle of poverty. The Department of Economic Opportunity (DEO) is California's primary antipoverty agency. The DEO uses State and federal resources to carry out a variety of programs which include employment, training, shelter, weatherization/energy, and health and nutrition services. Over one hundred local government and nonprofit agencies participate in accomplishing antipoverty objectives.
California receives formula entitlement funds under four federal programs: CDBG, HOME, Emergency Shelter (ESG) Grants, and the Housing Opportunities for Persons with Aids (HOPWA) Program. Additional resources are available from State programs, local programs, and private and nonprofit organizations. The State HCD Division is responsible for approximately 20 active grant and loan programs that address a range of needs. Many local communities have redevelopment projects, which are funded through tax increment financing. State law requires that 20 percent of these funds be set aside to finance housing for very low and low- and moderate-income households. Private lenders and builders provide an array resources and services in association with housing and community development, as do many nonprofits throughout the State.
The State has benefitted from the Consolidated Planning process through
enhanced coordination between its administering departments and their
constituents. The State will implement its strategies and action plans by
fostering, encouraging and directing its recipients' to take specific actions
linked to the State's priority needs.
Statewide according to the States Method of Distribution, which is principally a competitive application process, open primarily to jurisdictions which do not qualify to receive federal funds directly from HUD (i.e., non-entitlement communities).
Because the State primarily distributes funds to local jurisdictions and community development organizations who administer their own programs, the State does not link discrete activities to its Consolidated Plan priorities and strategies. Instead, the State provides policy guidance and sets minimum requirements for State recipients, who in turn carry out specific action plans responsive to local needs and consistent with the State's overall housing strategy.
Overall, the housing programs administered by the HCD Division of Community Affairs will combat poverty by increasing income through the development of housing with employment and economic development components, or economic development assistance. The State- administered housing programs are utilized in conjunction with employment training programs (e.g., Family Housing Demonstration Program, JTPA, GAIN, etc.). And, as discussed in the housing strategies above, the State will foster relationships with local communities in order to meet its housing goals.