COVID-19 Impact State Budgets and New Emergency Rental Assistance Bills
California Legislature Reconvenes facing an estimated $54B State Budget Deficit
After abruptly going on recess in March in response to stay-at-home orders due to the COVID-19 pandemic, California lawmakers returned to the capitol on May 4 to begin reviewing legislation in response to the crisis and review a dramatically changed state budget. With a shorter time frame to pass bills for the year, legislators have been asked to be selective in proposing bills. Assembly Appropriations Committee chairwoman Lorena Gonzalez said to the San Francisco Chronicle, “We’ve got to be realistic about how we look at all the bills coming forward. We said ‘Re-examine what you’re sending,’ for a variety of reasons.”
Most pressing at the moment, is the rush to address the state’s finances and pass a budget by the June 15 statutory deadline. A fiscal update from the Department of Finance dated May 7, 2020 estimates “an overall budget deficit of approximately $54.3 billion, of which $13.4 billion occurs in the current year and $40.9 billion is in the budget year.” The projections in the document also estimate a 21 percent drop in new housing construction permits this year. Senate President Pro Tem Toni Atkins sees the budget as a tool to help those who have been most impacted, saying “The budget is the single most important tool that we have in California to impact lives.”
The San Diego Housing Federation signed on to a letter on March 6, 2020 requesting an ongoing allocation of $2 billion to fund evidence-based solutions to homelessness, including affordable and permanent supportive housing. Given budget projections, it is difficult to determine COVID-19 Impact State Budgets and New Emergency Rental Assistance Bills the fate of this request, although addressing homelessness continues to be a top state priority. In addition, SDHF has supported several bills this year that may be impacted by the reduction in bills that will be heard this session.
Bills in U.S. Congress would provide $100 billion in emergency rental assistance
In response to advocacy from housing advocates from across the country, bills have been introduced by Ohio Senator Sherrod Brown in the U.S. Senate and Representatives Maxine Waters (CA) and Denny Heck (WA) in the House of Representatives to provide $100 billion in emergency rental assistance. The “Emergency Rental Assistance and Rental Market Stabilization Act” authorizes $100 billion to assist renters with future rent and utility payments. In a press release announcing the legislation, Congresswoman Maxine Waters stated, “We must take immediate action to prevent the COVID-19 crisis from turning into a national eviction crisis. It is absolutely essential for the next COVID-19 relief package to include this bill.” All four Representatives from the San Diego region – Reps. Susan Davis, Mike Levin, Scott Peters, and Juan Vargas – are listed as co-sponsors of the legislation. The bill reflects the request in an April 27, 2020 letter submitted to the California Congressional Delegation from affordable housing advocates throughout California, including San Diego Housing Federation. However, at the moment it does not appear to include the request that $10 billion be earmarked to support existing affordable housing developments with “break-even” rental assistance. We will be closely monitoring this legislation for this provision and alert members of any needed advocacy.