Conference negotiators discuss $200 million cap, 2035 sunset for CHIP and TIF in S.F. 127 talks

At a May 30 meeting of the Senate-House conference committee on S.F. 127, conference negotiators outlined a proposal that would cap a housing financing package at $200,000,000, set sunsets for both CHIP and TIF in 2035, require a 10-year report-back, and preserve an affordable-housing exemption while excluding mixed- or middle-income projects.

The summary was presented by Committee Member 1, conference committee member, who said, “That is a $200,000,000 cap, the increment retention at $75.85, a $20.35 sunset, both CHIP and TIF, the affordable exception for but 4, but not the mixed, and the 10 year report back. That is what we are proposing to you, and we have a document, and we are prepared to sign.”

Why it matters: CHIP (Community Housing Investment Program) and TIF (tax increment financing) are tools used to support affordable housing development; setting a dollar cap, a sunset date and retention percentages would limit how much revenue and how long those programs can support projects under the omnibus housing bill currently negotiated as S.F. 127.

Committee members disagreed about whether the $200 million cap had already been part of a prior “last best offer.” Committee Member 3, conference committee member, said, “My understanding is that we were willing to stay with the sunset at 2035 for no cap,” and later suggested the three negotiators confer if the cap were accepted. Committee Member 2, conference committee member, pushed back during the exchange and emphasized that prior proposals had different combinations of sunsets and caps.

Meeting remarks identified several concrete terms under discussion: a combined 2035 sunset for CHIP and TIF; an increment-retention level discussed as “75, 85” (recorded in discussion as “75.85”); a $200 million aggregate cap on the package; an exemption that would apply to “affordable” projects but not to “mixed” or middle-income projects; and a requirement for a 10-year report back on program effects. Several negotiators said the parties had a written document and were prepared to sign if they could resolve whether the cap was part of the agreed offer.

No formal motion or vote was recorded during the meeting. Instead, negotiators agreed to confer further: Committee Member 3 said they would contact the other members by phone to resolve outstanding clarification, and Committee Member 1 offered to use a nearby room to continue the discussion. The session then went offline to allow the smaller group to confer.

Discussion versus decision: the transcript records detailed bargaining over the cap and sunset terms but does not show a signed agreement or a formal committee vote. The committee members treated the proposal as a draft offer that would require confirmation by the negotiators before execution.

Next steps: negotiators said they would confer immediately and return when ready; the record does not show whether the document was ultimately signed or whether any terms changed after the offline discussion.