(a) (1) In this subdivision, “eligible jurisdictions” shall mean the following jurisdictions:

(A) The councils of governments in Los Angeles County, excluding the jurisdictions described in subparagraphs (B) through (F), inclusive.

(i) Funds, or a portion of the funds, provided to the San Gabriel Valley Council of Governments may be allocated by the council to the San Gabriel Valley Regional Housing Trust, and the trust shall use the funds pursuant to the same requirements as funding provided to the councils of governments.

(ii) A council of government that creates and operates a regional housing trust that is consistent with the San Gabriel Valley Regional Housing Trust model shall be eligible to receive a direct allocation. If any regional housing trust is created that does not correspond to an existing council of government, the board shall have discretion to determine the appropriate pro rata funding allocation.

(B) The City of Los Angeles.

(C) The City of Long Beach.

(D) The City of Glendale.

(E) The unincorporated areas of Los Angeles County.

(F) The City of Santa Clarita.

(2) Revenue generated pursuant to this part shall be allocated according to the following geographic distribution schedule:

(A) (i) Seventy percent of annual funding for the purpose of affordable housing preservation, affordable housing production, income assistance for extremely low-income households, and long-term, project-based rental assistance shall be allocated, based on the eligible jurisdiction‘s pro rata lower income housing need, to the eligible jurisdictions, provided that the allocation is consistent with the eligible uses of the funding set forth in paragraph (1) of subdivision (d) of Section 64830.

(ii) (I) Thirty percent of annual funding for the purpose of affordable housing preservation, affordable housing production, and long-term rental assistance, with no time limit, shall be allocated by the agency to the eligible jurisdictions consistent with the guiding principles of the agency and the eligible uses outlined in Section 64830.

(II) At least 5 percent of funds allocated pursuant to subclause (I) shall be used for technical assistance grants to cities with a population under 50,000.

(iii) If an eligible jurisdiction is found to be out of compliance with affordability targets at the end of a two-year period, the board may take any of the following actions:

(I) Limit the funding for the jurisdiction to extremely low and very low income housing units only until compliance is reestablished.

(II) Require the funding allocated to the jurisdiction to be administered by the agency instead of the jurisdiction.

(III) Increase funding incentives as needed to meet project and programmatic targets.

(iv) (I) Any eligible jurisdiction may receive a direct allocation of all or part of the jurisdiction’s funding described in this subparagraph if all of the following conditions are met:

(ia) The jurisdiction agrees to adopt and adhere to agency financing policies and guidelines, including public engagement and notice provisions outlined in this chapter.

(ib) All funded projects are in compliance with the agency’s eligible uses and affordability requirements.

(ic) The jurisdiction agrees to allocate its funding within 12 months through administrative processes without being subject to additional legislative process.

(id) The jurisdiction is in compliance with Affirmatively Furthering Fair Housing in California guidelines.

(II) (ia) Once committed to a specific project, funds shall remain available for expenditure for an additional five years, unless an extension is authorized pursuant to sub-subclause (ib).

(ib) If the funds have not been expended within five years of receipt as required in sub-subclause (ia), the jurisdiction shall show that it has made adequate progress towards completing the project. If the agency finds that the city has made adequate progress, the agency shall authorize an additional 24 months to grant entitlements to the remainder of the project. If the agency does not find that the city has made adequate progress, the funds shall be transferred to the agency. The agency shall hold the funds until the city submits a plan satisfactory to the agency to move forward with the project or allocate funds to another qualified project consistent with the jurisdiction’s expenditure plan.

(ic) For purposes of this subclause, “adequate progress” means the project has received the land use approvals or entitlements necessary for at least 75 percent of the project’s units.

(B) (i) Seventy percent of annual funding for the purpose of renter protections and support shall be allocated to the eligible jurisdictions, provided that the allocation is consistent with the eligible uses of the funding set forth in paragraph (2) of subdivision (d) of Section 64830.

(ii) (I) Thirty percent of annual funding for the purpose of renter protections and support shall be allocated by the agency to the eligible jurisdictions consistent with the guiding principles of the agency and the eligible uses outlined in Section 64830.

(II) At least 5 percent of funds allocated pursuant to subclause (I) shall be used for technical assistance grants to cities with a population under 50,000.

(iii) The agency shall have the discretion to fund any programs operated by any governmental or nonprofit entity that are consistent with the eligible uses outlined for renter protections and support. Direct unrestricted allocations are not permitted to any governmental entity.

(C) (i) Seventy percent of annual funding for the purpose of technical assistance, research, and policy development shall be allocated, on a per low-income renter household basis, to the eligible jurisdictions, provided that the allocation is consistent with the eligible uses of the funding set forth in paragraph (4) of subdivision (d) of Section 64830.

(ii) Thirty percent of annual funding for the purpose of technical assistance, research, and policy development shall be allocated by the agency on an at-large basis consistent with the guiding principles of the agency and the eligible uses outlined in Section 64830, subject to both of the following conditions:

(I) At least 5 percent of funds allocated pursuant to this clause shall be used for technical assistance grants to cities with a population under 50,000.

(II) The agency shall create a list of consultants who shall be available to provide technical assistance, research, and policy development to these cities consistent with this subclause. Cities with a population under 50,000 shall be entitled to a 10 percent administrative cost reimbursement as part of this application cost.

(b) Councils of governments in Los Angeles County shall be subject to the following requirements:

(1) Funds allocated to a council of governments shall be administered by the agency in collaboration with the council receiving funding.

(2)  Each city within each council of government may have its own set aside, which shall be based on its pro rata lower income housing need. The council of government and its members may develop policies to allocate set-aside funds.

(3) Funds, or a portion of the funds, provided to the San Gabriel Valley Council of Governments may be allocated by the council to the San Gabriel Valley Regional Housing Trust, and the trust shall use the funds pursuant to the same requirements to which funding provided to the councils of governments are subject pursuant to this chapter.

(c) Cities receiving a direct allocation shall be subject to the following requirements:

(1) The City of Los Angeles shall have its own set aside based on its pro rata lower income housing need, subject to a 50-percent limit on the category described in clause (i) of subparagraph (B) of paragraph (2) of subdivision (a).

(2) The City of Long Beach shall have its own set aside based on its pro rata lower income housing need.

(d)  The unincorporated area of Los Angeles County shall have its own set aside, which shall be based on its pro rata lower income housing need.

(e) The following factors shall be considered for at-large funding allocations:

(1) Whether the allocation affirmatively furthers fair housing.

(2) The allocation’s effect on displacement indicators.

(3) The allocation’s effect on rent-burdened populations.

(4) Whether the allocation serves populations with disabilities.

(f) In this section, “pro rata lower income housing need” shall mean the jurisdiction’s share of the total lower income housing needs assessment goal for the County of Los Angeles allocated pursuant to Section 65584.

(Added by Stats. 2022, Ch. 661, Sec. 1. (SB 679) Effective January 1, 2023.)