Earlier this week, I sent a letter to the Newsom Administration and legislative budget leaders sharing CCAH’s concerns and recommendations regarding the Governor’s proposed trailer bill. Within it, we found statutory language which would move a minimum of 50% of the bond cap currently administered by CDLAC over to the new California Housing and Homelessness Agency (CHHA) under their new Housing Development and Finance Committee (HDFC). While we fully support the goal of improving coordination and elevating housing as a statewide priority, we believe it’s critical to proceed carefully when it comes to the state’s most important housing finance tools, specifically the state tax credits and tax exempt bonds currently administered by the State Treasurer’s Office.
Our central message is this: the new CHHA and related HDFC will be just that—new. Before codifying in statute that a significant share of the state’s bond cap go to a brand‑new entity, it should be given time to build capacity, establish clear processes, and perhaps most importantly, demonstrate that it can deliver results at scale. That proof simply doesn’t exist yet.
What does exist is a long, successful track record at the State Treasurer’s Office through the California Tax Credit Allocation Committee and the California Debt Allocation Committee. CTCAC and CDLAC have decades of institutional knowledge and administer tax‑exempt bonds and housing tax credits through transparent, predictable systems that finance tens of thousands of affordable homes every year. At a time when California’s housing crisis remains acute, stability matters, and these programs are working.
For that reason, we have urged a more measured approach to allocating bond cap authority. Embedding a statutory requirement for a MINIMUM 50% split before the new department has completed even one full funding cycle introduces unnecessary risk. A phased and flexible model, which is what we are recommending, allows the state to evaluate real‑world demand and performance, while ensuring scarce resources continue to flow to projects that are ready to move forward.
We also emphasized that state LIHTCs, farmworker credits, and federal 9 percent credits should remain with CTCAC. These credits are cost‑neutral to the state, administered efficiently, and essential to maximizing housing production. There is no clear benefit to moving them out of a system that is already delivering strong outcomes.
As this reorganization moves forward, advocacy will only become more important. Starting next week, CCAH will be actively attending and testifying in committee hearings on our two sponsored bills, AB 2748 (Quirk‑Silva) and AB 2089 (Ward), as well as other bills we support and oppose, they begin their journey through the Legislature. At the same time, discussions around the BCSH reorganization and the new housing agency will continue to evolve quickly.
We encourage our members to stay alert and engaged and be prepared to talk with us and your State elected as these issues move through the budget and policy process. Your voices matter, especially as decisions are being made that will shape how California finances affordable housing for years to come.
Warmly and in partnership,
