When policymakers focus exclusively on ELI and VLI housing, they risk overlooking a large and growing segment of Californians who struggle every day to remain in the communities where they work. They are teachers, nurses, childcare workers, social workers and local government employees, and law enforcement officers, nonprofit staff, tradespeople, young professionals right out of college working at the Capitol and working families. These are the people for whom CCAH members build housing. And yet, it was clear to me that this official spent little of their time thinking of housing for these folks and were instead very focused on the optics of homelessness. Again, we need to find a solution for that AND we also need to create affordable housing for the moderate and middle-income people who make california run. This is not an either/or problem. It’s a both problem.

In California, moderate and middle-income or workforce housing is generally defined as housing serving households earning between 80% and 120% of area median income (AMI). Yet increasingly, I see a movement to focus the financing tools available to affordable housing developers almost exclusively toward building for residents earning 20% to 60% of AMI. If you followed the discussion and ultimate decision by the Administration to set aside of 50% of the private activity bond cap and affiliated tax credits for HDFC funded projects and have heard about the move towards creating a preference for the 9% credits for ELI/VLI projects through HDFC, you know that the resources are getting more and more scarce for workforce developers. As a result, there is a growing recognition that workforce housing occupies a gap between traditional affordable housing and market-rate housing that our current policy framework largely fails to address.

The conversation in California has increasingly become about who is most vulnerable, and that’s an important conversation, but we should be equally concerned about whether teachers can afford to live near the schools where they teach. Whether nurses can afford to live in the communities where they provide care. Whether housing counselors, nonprofit workers, and public servants can remain in the regions they serve. If we fail to house the workforce, we create a dangerous imbalance. Employers struggle to hire and retain talent. Workers endure longer commutes. Communities lose economic diversity. Housing cost burdens increase. And ultimately, more households fall into financial instability.

Housing providers themselves are under incredible pressure. Across California, developers are grappling with rising insurance costs, persistently high interest rates, escalating construction expenses, labor shortages, utility connection delays, and increasing operating costs. The economics that once made projects feasible often no longer pencil out. Affordable housing developments routinely face substantial funding gaps, and thousands of affordable homes remain stalled awaiting sufficient financing to proceed.

That is why preserving financing tools such as the 9% Low-Income Housing Tax Credit is so important for workforce and middle income housing. The 9% credit remains one of the most effective tools for producing and preserving affordable rental housing. It provides a critical source of equity that makes projects financially feasible and has long served as the backbone of affordable housing development nationwide. As California debates future housing policy, I worry when I hear proposals that would further narrow eligibility, create new preferences that overwhelmingly favor only the deepest income targeting, or treat workforce housing as somehow less important than other affordable housing.

The strength of California’s affordable housing industry has always been its ability to serve a wide range of residents across the economic spectrum. The members of CCAH build and preserve housing that creates pathways to stability, opportunity, and upward mobility. Their work is not limited to a single income category. It supports entire communities. Reducing affordable housing policy to homelessness alone misses the bigger picture.

As California debates how to allocate increasingly scarce housing resources, we should be extremely cautious about creating preferences that elevate one type of affordable housing over another. Housing policy works best when it serves the full continuum of need, not when it pits one population against another. We have already seen the consequences of this thinking through the set-aside of 4% tax-exempt bond resources for a limited subset of projects, a decision that will almost certainly reduce flexibility, distort project selection, and leave many worthy workforce developments competing for an even smaller pool of financing. We should not repeat that mistake in the 9% tax credit program.

CCAH strongly opposes creating a preference for HDFC-funded projects or any policy that further narrows access to one of the state’s most effective affordable housing financing tools. The answer is not to choose between housing homeless Californians and housing the workforce that keeps our communities running. The answer is to build enough housing at every income level. Once we begin creating preferences based on who we believe is most deserving, we embark on a slippery slope that threatens the balanced housing ecosystem California desperately needs. Our housing crisis is too severe, and our resources too limited, to divide affordable housing into winners and losers. We must protect financing tools that allow the industry to serve the entire housing continuum and ensure that California continues to produce housing for all those who need it.

In partnership,

Executive Director, California Council for Affordable Housing