Assembly hears plan to create California Housing and Homelessness Agency and a housing finance committee to speed affordable housing funding

Assembly committees heard detailed testimony and stakeholder testimony on the governor's plan to split the Business, Consumer Services and Housing Agency and to create a California Housing and Homelessness Agency (CHHA) with a Housing Development and Finance Committee aimed at aligning and speeding state affordable-housing financing.

Secretary Tamika Moss and housing agency leaders described the CHHA as a structural change to improve program alignment across HCD, CalHFA, the Civil Rights Department and other entities, with an explicit goal of simplifying funding award processes and reducing timelines and costs for affordable-housing projects. Gustavo Velasquez, director of the Department of Housing and Community Development (HCD), said HCD has provided funding for about 60,000 new affordable homes and helped local governments plan to accommodate 2.5 million new homes; he argued a dedicated cabinet-level agency would sustain momentum and improve coordination. Rebecca Franklin, chief deputy director at the California Housing Finance Agency (CalHFA), said the structure is designed to "facilitate this work through focused leadership, streamlined and transparent decision making, and effective use of state dollars." (testimony)

Why it matters: Housing developers and nonprofit advocates told the committees that fragmented funding processes and sequential award timelines add significant time and cost to projects and that a coordinated funding committee could reduce delays that make projects infeasible. Several speakers described projects in which state funding commitments from multiple programs sat idle while developers waited for final awards, increasing costs and causing projects to fail.

Key details and claims - Housing Development and Finance Committee: The proposal calls for a multi-agency committee to create a single funding award process for multifamily affordable housing, streamline compliance and increase transparency through public decision-making and appeals. Officials said the committee will pursue program alignment across state government and oversee creation of a coordinated application and award timeline; an executive committee will develop program-alignment recommendations in year one. (presentation by Rebecca Franklin and Gustavo Velasquez) - Timeline: Officials said the reorganization will be phased. Secretary Moss and HCD staff said year 1 will focus on preparation; by July 2026 BCSH would be replaced by two agencies and the Housing and Finance Committee would become operational; subsequent phases would transfer staff and programs upon appropriation. (presentation remarks) - Developers' accounts of delays: Margaret Miller, president of development for the John Stewart Company, described Cornerstone Village (Elk Grove) as an 84-unit project that secured roughly $15 million from four public sources but failed to close after nearly three years because the project could not get the remaining funding; she said nearly 45,000 units statewide are ready to proceed if funding timing were fixed. Jeffrey Morgan (CHISPA) cited Colorado's one-stop practice that committed funding simultaneously and said shortening timelines would save money and allow more units to be built. - Data and progress cited: Officials said California now permits many more accessory dwelling units (ADUs) than several years ago (from roughly 5,000 to roughly 28,000 per year), that a surplus land pipeline can yield about 32,000 units, and that the Housing Accountability Unit has unlocked more than 8,000 units. Secretary Moss also referenced state reporting showing about 60,000 people exited homelessness in 2024 while noting work remains to reduce unsheltered homelessness.

Stakeholder views and concerns Developers, housing nonprofits and advocacy groups broadly supported the structural change and urged two key additions: (1) a true "one-stop shop" that includes coordination with tax-credit and bond allocating bodies (TCAC and CDLAC) and (2) sufficient implementation funding and staff to make a consolidated process work. Several witnesses recommended formal representation for TCAC and CDLAC on the Housing Development and Finance Committee.

Legislative concerns raised Lawmakers repeatedly asked how the reorganization aligns with the state budget calendar and whether the Little Hoover Commission and May revision timelines would allow the legislature adequate review before budget deadlines; some members said the proposal should have been brought earlier so fiscal impacts could be considered before May. Lawmakers also pressed whether CalHFA's statutory and financial independence (separate credit rating, board governance and financing authority) would remain intact; CalHFA officials said those separations would be preserved.

Ending: Committee members and stakeholders signaled broad support for the objective of streamlining housing finance while reserving judgment pending fiscal details in the governor's May revision, additional Little Hoover Commission findings and the legislative review of implementation details and appropriations.