New State Funding Opportunities

At Housing Tools, we understand the special needs and challenges that local governments and Continua of Care face in securing the necessary State and Federal funding to meet their affordable housing needs. Our team has the knowledge and experience to help you successfully navigate today’s complex funding environment. Our Community Development Manager, Sherry Morgado, has over 24 years of experience working within rural and suburban City and County government to fund, develop, and implement community development and housing programs. Housing Tools’ Principal, James Coles, compliments this expertise with over 13 years of affordable housing development experience and 7 years of local government experience.

Our firm can assist organizations with applications for:

  • All of the work elements involved in creating or updating your Homeless Plan to meet No Place Like Home (NPLH) requirements as well as applications for NPLH funding.
  • New funds that were part of the 2017 Housing Package, such as the Homeless Emergency Aid and Building Jobs and Homes Act programs.
  • Housing for a Healthy California Program funding, established by AB74
  • Community Development Block Grant (CDBG) and HOME

New Funding Opportunities for Your Community

Due to the passage of a major housing package and related trailer bills in 2017 and 2018, there will be an entire slate of new funding opportunities available to address homelessness and affordable housing for both local governments and Continua of Care in California beginning in the Fall of 2018 and continuing into 2019 and beyond. Housing Tools is tracking the latest developments on these opportunities and is poised to assist you with your Homeless Plan, funding applications and strategic plans for using these various funding streams in a cohesive fashion.

No Place Like Home (NPLH):

Subject to approval by the voters of California in the November 2018 election, NPLH will provide funding to counties to create affordable housing units specifically set aside for persons with serious mental illness who are chronically homeless, homeless or at risk of being chronically homeless. Counties may acquire, design, construct, rehabilitate, or preserve permanent supportive housing for the target population.

NPLH will include both a non-competitive one-time process and a multiple funding rounds competitive process:

  • Non-competitive: $200 million has been set aside for all counties statewide. Each county will receive the greater of $500,000 or each county’s proportionate share of the $200 million based on the county’s share of the number of homeless persons compared to the State’s homeless population. Each county’s non-competitive allocation amounts can be found here: NPLH Non-Competitive Formula Allocation
  • Competitive: The State will allocate up to $1.8 billion in multiple funding rounds. The first round anticipates the release of approximately $253.6 million, with $21 million set aside for small counties (population less than 200,000).

As part of the threshold requirements to apply for the NPLH funding, counties must submit a Homeless Plan that meets specified criteria, including developing the plan through a collaborative community process, and a description of goals, strategies and activities to reduce homelessness and make it non-recurring.

HCD anticipates releasing NOFAs for NPLH as follows: August 2018 for Non-Competitive allocations and December 2018 for Competitive allocations.

Homeless Emergency Aid Program (HEAP):

The HEAP program will provide local Continua of Care (CoCs) with one-time funds to address immediate homelessness challenges in their jurisdiction. A total of $500 million will be allocated statewide, through the following distribution process:

  • $250 million to Continua of Care based on 2017 homeless point in time count;
  • $150 million direct allocation to a city or city that is also a county with a population of 330,000 or more as of January 1, 2018; and,
  • $100 million to Continua of Care based on their percentage of the statewide 2017 homeless population.

In order to access the HEAP funding:

  • The City, county, or joint power must declare an emergency shelter crisis (there will be a waiver process for cities and counties who had a 2017 PIT count showing 999 or fewer homeless individuals).
  • The Continuum of Care must demonstrate collaboration with other city, county, or nonprofit partners.

Funds will be allocated directly to CoCs, and cities and counties who have declared a shelter crisis or are eligible for the waiver, will apply to their local CoC for funding. There are deadlines for obligation and expenditure of funds:

  • 50% of funds must be contractually obligated by January 1, 2020
  • 100% of funds must be contractually obligated and expended by June 30, 2021.

HEAP Eligible Activities to Address Immediate Needs:

  • Emergency housing vouchers
  • Rapid rehousing
  • Emergency shelter construction, and
  • Use of armories to provide temporary shelters, among other activities

Building Homes And Jobs Act (SB2):

SB2 established a permanent source of funding for affordable housing by imposing a recording fee of $75 per document for real estate transactions. The fee is expected to generate $225-$250 million annually. The revenue generated will be made available in a multi-year, multi-pool process.

Year 1 (calendar year 2018):

  • Planning and Technical Assistance (PTA) Grants: 50% of funds will be made available to local governments to update planning documents and zoning ordinances in order to streamline housing production. The NOFA for PTA grants is expected in Spring 2019.
  • Homelessness Grants: 50% of funds are set aside for HCD distribution to address homelessness. SB850 amended SB2, and further divided the Homelessness Grants’ funding into four funding streams. After a distribution of $5 million each to Merced and Orange counties, the remaining funds will be allocated as follows:
  • 50% to Continua of Care through the California Emergency Solutions & Housing (CESH) Program, established by SB 850. These funds will be combined with the remaining 2016 California Emergency Solutions Grant (ESG) funds. Eligible uses of the CESH funds:
    • Rental assistance and housing relocation and stabilization services
    • Operating subsidies in the form of 15-year capitalized operating reserves for new and existing permanent housing units
    • Flexible housing subsidy funds
    • Navigation centers
    • Street outreach services
    • Shelter diversion activities
    • Systems support for Coordinated Entry Systems, Homeless Management Information Systems, and homelessness planning activities.
  • HCD anticipates the release of NOFAs for CESH in August 2018 and again in early 2019.
  • 50% to the Housing for a Healthy California Program, created by AB 74. Further details on this program are provided below.

Year 2 (calendar year 2019) and every calendar year thereafter:

  • Local Funds: 70% of funds will be allocated to a Local Funds pool
  • 83% of Local Funds will be allocated to CDBG entitlement jurisdictions using CDBG formula factors
  • Non-entitlement jurisdictions will access Local Funds through two funding pools:
    • 10% of Local Funds will be set aside and allocated by formula, using CDBG formula factors
    • 7% of Local Funds will be made available via a competitive grant process
  • Eligible uses of Local Funds:
  • Low Income Housing: Low income multi-family housing development, capitalized reserves for permanent supportive housing, acquisition and rehabilitation of foreclosed or vacant homes, accessibility modifications.
  • Moderate Income Housing: Home rental and ownership for middle-income families, homeownership opportunities including down payment assistance.
  • Homelessness: Rapid rehousing, rental assistance, navigation centers, emergency shelters, and permanent and transitional housing.
  • Local Matching Funds: Local or regional housing trust funds; Low and Moderate Income Housing Asset Fund.
  • Incentives: Incentives or matching funds for permitting new housing.
  • The NOFA release for Local Funds is expected Summer 2019.

Housing For A Healthy California

AB 74 requires HCD to establish the Housing for a Healthy California program, with funding made available through:

  • 50% of the Year 1 (calendar year 2018) revenue from the Building Homes and Jobs Act program, as mandated by SB 850
  • Revenues appropriated to HCD from the federal Housing Trust Fund allocations for years 2018 to 2021

The purpose of the program is to decrease the disproportionately high healthcare utilization rates and costs for chronically homeless and homeless individuals who are living unsheltered. The program will provide grants to counties for capital costs of housing (acquisition, new construction, or reconstruction/rehabilitation), as well as project based operating assistance (long-term rental assistance, capitalized operating reserve). To be eligible, the county must have a source of funding for providing intensive services that promote housing stability, such as Whole Person Care Pilot, and/or Health Home Program funds, funded through the 1115 Medicaid Waiver, or other county-controlled funding.

HCD is currently working on the guidelines for the program, and anticipates the NOFA release for Housing for a Healthy California in Spring 2019.

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