July 1, 2021

The California Department of Housing and Community Development (HCD) released the application for its prohousing designation program upon approval of emergency regulations for the program this week. Local governments that receive this designation will be awarded extra points in several state grant programs related to housing and transportation.  

HCD will be holding a workshop on how local jurisdictions can apply to the Prohousing Designation Program and gain Prohousing status on Thursday, July 29 from 3– 4 p.m. The registration link is available here.

Prohousing Designation Regulations

HCD has a year to convert the emergency regulations into regular regulations. CSAC will be filing comments on the regulations during the 45-day public comment period. Please send any feedback on the emergency regulations to Marina Espinoza.

The emergency regulations are available here, and a PowerPoint providing an overview of the program is available here. Other program materials, including the application materials, are available on the Prohousing webpage. For questions related to the Prohousing Designation Program, please contact ProhousingPolicies@hcd.ca.gov.

The emergency regulations implement the Prohousing Designation Program authorized by the 2019-20 Budget Act. AB 101 (Committee on Budget, 2019) tasked HCD with designating jurisdictions as “Prohousing” when they demonstrate policies and strategies to accelerate housing production. In turn, Prohousing jurisdictions will be awarded additional points or preference in grant programs, such as the Affordable Housing and Sustainable Communities, Transformative Climate Communities, and Infill Incentive Grant programs. 

In November 2019, CSAC submitted comments in response to HCD’s Prohousing Policies Framework Paper, which included initially proposed approaches to implement the Prohousing Designation Program. In our comments, we raised the following key issues:

• Expressed concerns with requiring jurisdictions to use limited general funds to support affordable housing as a threshold requirement for receiving the designation, and
• Requested sufficient flexibility so all community types could fairly receive the designation.

To receive the prohousing designation, jurisdictions must meet basic threshold requirements related to compliance with the Housing Element Law and other state housing laws and demonstrate actions worth at least 30 points spread across each of four categories: favorable zoning and land use, acceleration of housing production timeframes, reduction of construction and development costs, and providing financial subsidies. Two of the categories explicitly include flexible options to earn points for non-listed actions that help achieve the stated goal.

The emergency regulations appear to be flexible enough to allow many types of local jurisdictions to achieve the designation. CSAC is concerned, however, that the regulations appear to require direct financial subsidies of affordable housing projects in order to achieve the designation. While many counties help subsidize affordable housing with limited local funds, it may be difficult for counties with limited budgets or lower tax bases to meet this requirement.

Related Legislation

In addition to tracking the development of the prohousing regulations, CSAC has taken an “oppose” position on AB 215 (Chiu). This bill would require jurisdictions where housing production has lagged compared to elsewhere in the region to have a mid-cycle housing element consultation with the Department of Housing and Community Development and adopt policies to achieve the Department’s pro-housing designation. CSAC has expressed concerns with turning this incentive-based program into a mandate for some local governments, as well as creating an additional mid-cycle housing element review process that will be targeted mostly at jurisdictions with weaker economies.