Dave Cortese

Existing law, the California Health Facility Construction Loan Insurance Law, establishes an insurance program for health facility construction, improvement, and expansion loans in order to stimulate the flow of private capital into health facilities construction, improvement, and expansion and in order to rationally meet the need for new, expanded, and modernized public and nonprofit health facilities necessary to protect the health of all the people of this state.

Existing law establishes the California Housing Finance Agency in the Business, Consumer Services, and Housing Agency. Existing law also establishes the California Homebuyer's Downpayment Assistance Program for purposes of assisting first-time low- and moderate-income homebuyers utilizing existing mortgage financing, as described, and requires the agency to administer the program.

Commencing January 1, 2027, and only if Senate Constitutional Amendment ____ of the 2025–26 Regular Session is approved by voters, this bill would enact the California Housing Finance and Credit Act (CAHFCA) to establish, without cost, a credit enhancement program for affordable housing construction loans and permanent loans to further housing production within the state by stimulating the flow of private capital into affordable housing construction and development in order to rationally meet the need for new and expanded affordable housing necessary to house all the people of this state. CAHFCA would require the agency to administer and implement the program, as provided, and would authorize the agency to insure and offer credit enhancements for construction loans and permanent loans for affordable housing developments. CAHFCA would require the agency to prepare an annual report and obtain an annual agreed-upon procedures engagement, as specified. CAHFCA would require the Legislative Analyst's Office to prepare a biannual report regarding the effectiveness of the program, as specified. CAHFCA would set forth various powers and duties of the agency in the event of a default of a loan insured by the program.

CAHFCA would establish the California Housing Finance and Credit Fund in the State Treasury and would continuously appropriate moneys in the fund to the agency for the purpose of providing credit enhancements for insuring construction loans and permanent loans under the program and for the purpose of defraying administrative expenses incurred by the agency in operating and implementing the program. CAHFCA would require the agency to establish a premium charge for the insurance of loans under the program and would require that this charge be deposited in the fund. CAHFCA would authorize the premium rate to vary, as specified, but would prohibit the rate from being greater than 2%. CAHFCA would require the Governor to include in the budget as submitted to the Legislature a limit to the authorization for the agency to insure housing construction and expansion loans for the budget year, as provided. CAHFCA would also make related findings and declarations.

Existing law, the State General Obligation Bond Law, generally sets forth the procedures for the issuance and sale of bonds governed by its provisions and for the disbursal of the proceeds of the sale of those bonds.

 CAHFCA would declare that its provisions are not subject to the State General Obligation Bond Law. CAHFCA would also declare that its provisions are severable.