Housing Policy to Pay Attention to Right Now in Sacramento

JOIN US VIRTUALLY ON WEDNESDAY, AUGUST 27TH 12PM

Join SV@Home for our next Policy in Action@Home as we break down the latest developments from the Capitol with insider guest Leslie Rodriguez, Partner at California Strategies and Board Chair of the SV@Home Action Fund.

We’ll unpack:

– What’s in (and out of) the state budget

– The housing bills gaining traction and the ones quietly dying

– How this legislative session could shape housing access in our region for years to come

This is your chance to get the real story behind the headlines and what it means for our local work.

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July 30, 2025

Sticks & Bricks News for Developers: July 2025 Edition

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This month’s Sticks & Bricks spotlights major shifts in California’s affordable housing landscape, including emergency rulemaking by CTCAC to align with federal LIHTC reforms that lower the bond financing threshold and expand access to 4% credits. We also cover San Jose’s push for a Prohousing Designation, and the latest updates to state CEQA and permitting laws. 

CTCAC Emergency Rule-Making

The California Tax Credit Allocation Committee (CTCAC) is moving quickly to implement emergency rule changes that align with major federal updates to the Low-Income Housing Tax Credit (LIHTC) program. These changes follow the federal reduction of the bond financing threshold from 50% to 25%, which dramatically expands access to 4% credits. CTCAC’s proposed updates clarify state alignment with this new standard, introduce caps for enhanced state tax credits across set-aside pools, provide flexibility on developer fees for previously awarded projects, and codify waitlist priority for disaster-displaced households. 

While the public comment window has now closed, CTCAC will vote on the final package at its August 5, 2025 meeting, where the outcome will shape how developers access and deploy both state and federal credits going forward. Developers are encouraged to tune in, stay informed, and begin planning around these updates, which are expected to unlock additional opportunities—but also come with new considerations around competition and cost allocation.

Funding Opportunities

Explore these new funding sources for affordable housing development:

  • NEW: Tax Credit Reform
    • Starting in 2026, the One Big Beautiful Bill Act (P.L. 119-21) will implement two major changes to the Low-Income Housing Tax Credit (LIHTC) program: a 12% permanent increase to each state’s annual 9% LIHTC allocation authority and a reduction in the tax-exempt bond financing requirement from 50% to 25% for 4% credit eligibility. These reforms are expected to significantly expand access to tax credits, enabling more projects to qualify with less bond financing.
  • San Jose NOFA– 2025 Update
    • The City of San José has launched a rolling RFP for its Gap Financing Program, accompanied by updated underwriting guidelines. Projects submitted will be publicly scored, with top proposals prioritized for funding and the remainder added to a new waitlist.
  • Homekey+ and Tribal Homekey+
    • The State of California has launched two parallel funding programs to expand Permanent Supportive Housing for individuals experiencing or at risk of homelessness with behavioral health challenges. The Homekey+ NOFA provides $2.145 billion for projects serving veterans and other individuals with behavioral health needs. In parallel, the Tribal Homekey+ NOFA allocates $121 million specifically for Tribes and Tribal Entities to create culturally appropriate housing solutions for households facing similar challenges. 

News and Resources

Access important resources and guidance for affordable housing development:

  • ICE Response Resources
    • At SV@Home, we are committed to providing developers with the resources necessary to effectively train staff on how to respond to potential ICE raids. Here we have compiled a list of available resources to help navigate these challenges, along with the link to our recent Policy in Action (PIA) event on this very subject 
  • NEW: CSJ Prohousing Designation Application
    • San Jose has released its draft application for the State’s Prohousing Designation and is accepting public comments through August 17, 2025. This is a valuable opportunity for affordable housing developers to weigh in on the City’s efforts—highlighting what’s working, where challenges remain, and how policies can better support housing production. We encourage developers to share feedback by emailing hsg-policy@sanjoseca.gov or submitting comments directly to HCD.
  • NEW: CEQA Reform
    • Governor Newsom has signed historic legislation enacting sweeping housing and CEQA reforms as part of the 2025–26 state budget, streamlining approvals, expanding permitting tools, and unlocking new financing to accelerate affordable housing production statewide. The package includes AB 130 and SB 131, which deliver long-sought regulatory stability, accountability measures, and innovative programs like the Affordable Housing Excess Equity Program.
  • NEW: CTCAC 2025 Round 2 QRRPS Final Recommendation List
    • The California Debt Limit Allocation Committee has released its final recommendation list for 2025 Round 2, awarding key funding to several Santa Clara County affordable housing developments. Congratulations to; Related & ALTA’s Lot 12, Charities Housing’s El Camino Real Multifamily, Affirmed Housing’s Berryessa TOD, Core’s Gateway Tower, BMG Housing Rehab, and the Paseo Senter II Rehab—each playing a critical role in advancing our region’s affordable housing pipeline.
  • NEW: Streamlining of Long-Term Monitoring for Co-Regulated Developments
    • HCD, CalHFA, and CTCAC have signed a new MOU under AB 2006 to streamline long-term monitoring for Co-Regulated Developments, reducing duplicative submissions and aligning procedures across agencies. As of January 1, 2025, developers benefit from simplified processes for inspections, reserve draws, ownership changes, property management updates, and operating budget submissions.

Upcoming Events

Mark your calendars for these key industry events:

  • NEW: CSJ Prohousing Application Info Session
    • Join the City of San José on August 7th at 4:00 PM for a virtual Community Engagement Session—an opportunity to learn more about the City’s upcoming Prohousing Designation application and how to get involved.
  • NEW: CHP Presents “Affordable Homes At Risk: Preservation Challenges and Opportunities”
    • Join the California Housing Partnership on Monday, August 11th from 11:00am–1:00pm for a free virtual webinar, Affordable Homes At Risk: Preservation Challenges and Opportunities, focused on the loss of affordable homes due to expiring regulatory agreements and market-rate conversions. The event will feature new research, case studies, and a policy panel on how to preserve both subsidized and unsubsidized affordable housing across California.
  • NEW: SF Business Times Presents “Bay Area Housing for All”
    • Join the San Francisco Business Times for Bay Area Housing for All on Thursday, August 7th from 8:00–10:30am, where housing leaders will discuss creative financing and policy solutions to the region’s housing crisis. This in-person event will explore cross-sector strategies to accelerate affordable housing for essential workers and middle-income residents.
  • NEW: SPUR Presents “California’s Affordable Housing Agenda Facing Trump Administration 2.0”
    • Join SPUR for a free Digital Discourse on Tuesday, August 19th from 12:30–1:30pm, where national experts will discuss the future of federal affordable housing policy under a potential second Trump administration. Topics will include updates on LIHTC expansion, HUD funding, and new homeownership incentives like the Neighborhood Homes Investment Act.
  • NEW: Terner Center Presents “Housing Supply & Finance: Catalyzing Community Investment & Policy Reform”
    • Join the Terner Center and FHLBank San Francisco for a free virtual convening on Wednesday, August 20th from 2:00–5:00pm, focused on catalyzing community investment and policy reform to increase housing supply. The event will feature developers, lenders, and policymakers discussing pro-housing policies and financing solutions to address the region’s affordability crisis.