State Sen. Josh Becker, D-San Mateo, introduced a bill to substantially reduce costs for affordable housing projects in the state by enabling affordable housing developers to make the best use of limited financial resources. Senate Bill 948 would shift the responsibility to hold a certain amount of money — what are called “transition reserves” — from the individual project level to a pooled reserve model operated by the Department of Housing and Community Development, according to his office.
Currently, affordable housing developments in the state that receive specific types of rental or operating subsidies, including federal Section 8 project-based housing vouchers, are required to hold a certain percentage of total project costs in a “transition reserve” fund. Field research shows use of these reserves is so low as to be nonexistent. Not a single HCD-funded project has needed to access its transition reserves in the past decade, according to Becker’s office.
SB 948 is expected to be heard in a Senate policy committee this spring.