(a) The Legislature finds and declares all of the following:

(1) The private housing market has failed to meet the needs of the vast majority of California residents, who are unable to afford market rents. Increasingly, housing speculation and financialization in the rental market is driving rents higher, even as new market-rate housing is produced. Today, more than one-quarter of California renters are severely rent burdened, meaning they spend over one-half of their income on rent alone, and the unaffordability of rents is a major driver of homelessness.

(2) It is the goal of the state, as reflected in its Regional Housing Need Determination for the sixth Regional Housing Needs Assessment (RHNA) cycle, to create 2,500,000 new housing units, of which at least 1,000,000 must be affordable to households with low, very low, and extremely low incomes and of which an additional 400,000 must be affordable to households of moderate incomes. Together, housing affordable to lower and moderate households accounts for 58 percent of the overall projected housing need.

(3) Affordable housing produced through the federal Low-Income Housing Tax Credit program is an essential part of California’s housing stock, but is not sufficient to meet the need for housing affordable to those who cannot afford market rents. Moreover, the expiration of affordability covenants each year threatens to revert affordable units to market rents.

(4) The solution to the intertwined crises of rental unaffordability and homelessness must include a robust sector of social housing that offers below-market rents affordable to households of all income levels who are unable to afford market rents and that is permanently shielded from the speculative market. This work can be accomplished only through a robust partnership between the state and the federal government, including a significant infusion of federal funding resources and policy reforms at both the state and federal levels.

(5) California has a growing social housing sector, comprised of housing acquired, produced, and managed by public entities, public housing authorities, community land trusts, community development corporations, and nonprofit affordable housing developers. This bill will set California on a course to scale up its nascent social housing sector to meet the scale of the need, now and for future generations.

(b) It is the intent of the Legislature in enacting this chapter to define social housing, to identify tools to help achieve the state’s goals for lower and moderate-income housing by creating social housing through both new production and preservation of existing units and to evaluate potential future legislation based on a comprehensive study of resources, constraints, and opportunities for creating below market rate housing that includes both affordable and social housing options.

(Added by Stats. 2023, Ch. 402, Sec. 1. (SB 555) Effective January 1, 2024.)