As we go to press with this edition of our newsletter, it’s Primary Day in California. I will admit that my ballot sat on my kitchen table, open and partially filled out, for weeks. Every evening I’d stare at it and then put my pen down and leave it for the next day. It’s in the ballot box now, but it took me longer than it ever has before to make my choices and I know I was not alone.
Over the next few weeks, the political landscape for the general election in November will start to shape up and we’re preparing for what that will mean for affordable housing. Our PAC is gearing up and we’re already arranging interviews with candidates for races in which we wish to engage.
The Governor’s race is understandably drawing the most attention and with 61 candidates on the ballot, that’s no surprise. Whoever ultimately leads the state will shape the policy environment we work in every single day so we are, of course, engaged in that race. But there’s another statewide race that rarely gets the spotlight and yet has enormous implications for our industry and that’s the race for Insurance Commissioner.
If you’ve been anywhere near a development pro forma lately, you know why this matters. Insurance premiums for multifamily projects, including affordable housing, have skyrocketed. And I don’t mean modest increases. I mean jumps that fundamentally threaten feasibility. One example that really stuck with me came out of LA County and it cited a fire insurance renewal for a local 32-unit affordable apartment building. In 2024 that project was hit with a 33% increase in a single year. While these kinds of increases are hitting everyone, affordable housing providers are at a particular disadvantage. Unlike market rate apartment owners, who can raise rents to offset increased costs, the very nature of affordable housing means rents are restricted. The kind of spike described above isn’t just painful, it’s destabilizing. Worse yet, in 2025 the insurer notified the owner that they would no longer insure the building at all. And I’m hearing stories like this from across the state.
The Insurance Commissioner plays a critical role in regulating this market, and the decisions made in that office directly affect whether affordable housing providers can continue operating safely and responsibly. Look for us to take a position on the Insurance Commissioners race and the Governors race soon after the Primary.
While we’re watching these statewide races closely, we’re also just one week away from gathering in Napa for our Spring Conference — and I have to say, this year’s program is one of the most exciting we’ve ever put together. Our panels are packed with experts who are ready to dig into the issues that matter most right now: financing, insurance, state policy, and the future of affordable housing production. And because the conference begins on June 8, just days after the election, our legislative panels will be sharing up‑to‑the‑minute insights on early results and what they may signal for the months ahead. It’s going to be a dynamic, timely, and energizing few days together.
Another issue we’ve been deeply engaged in is HCD’s monitoring fees. Last week, we wrote this letter and supported Assemblywoman Avila Farias’ request for an audit of those fees and were prepared to give testimony during the Joint Audit Committee if the item were pulled off the consent calendar. Our position is simple. The current formula hasn’t been updated in more than two decades, and we believe the current formula no longer reflects the actual cost of oversight. We shared several real‑world examples with the Legislature, including a recent 91‑unit AHSC loan with a $19 million principal that carries an $81,900 annual monitoring fee. That’s $900 per unit, per year. Fees like this directly reduce project feasibility and ultimately limits how many affordable homes can be built.
An audit is a practical, data‑driven step toward a fee structure that is fair, transparent, and aligned with real administrative costs. We’re grateful to Assemblywoman Avila Farias for her leadership, and grateful to all of you for continuing to push for policies that strengthen our affordable housing pipeline.
I’m looking forward to seeing you in Napa, sharing space, comparing notes, and continuing this work together.
In partnership,
