Builders rejoice: L.A. is about to divvy up $387 million for inexpensive housing initiatives.
The cash is being doled out by the L.A. Housing Division, and it’s the biggest solicitation within the division’s historical past. The bulk is funded by Measure ULA, the so-called “mansion tax” that prices a switch tax to all L.A. property gross sales above $5 million.
Purposes for the discover of funding availability, or NOFA, open Friday and shut Oct. 20. Funds can be found to nonprofit and for-profit builders, in addition to group land trusts, restricted fairness housing co-ops, public entities and different organizations.
Housing Division Basic Supervisor Tiena Johnson Corridor referred to as it “historic second,” saying that the funding will go towards not solely new development, however housing preservation and working help funding.
The $387 million — which consists of $316 million from ULA funds and $71 million from state and federal packages — represents town’s greatest dedication of ULA spending for the reason that measure took impact in 2023. The tax has raised greater than $784 million within the final 2½ years, however a lot of it hasn’t been spent attributable to considerations that the tax could possibly be overturned in court docket.
As authorized challenges light, town handed a $150-million ULA spending plan final yr and a $425-million spending plan in July.
Johnson Corridor mentioned the division doles out funding to housing initiatives each few years, however usually throughout the vary of $50 million to $75 million, so the $387-million NOFA is an enormous step up. Since Measure ULA is a continuing supply of funds, the Housing Division can be releasing new funding on a yearly foundation going ahead.
Usually, every spherical of funding receives about 30 to 35 functions from builders, although this spherical most likely will entice extra since there’s extra money to go round.
The funding marks a strategic shift as town appears to be like to expedite development within the midst of a housing disaster. In earlier rounds of funding, town doled out cash based mostly on the variety of models in a challenge. This time, funding is predicated on a proportion of growth prices, and builders will obtain greater awarded quantities than they often do.
Johnson Corridor mentioned the brand new method offers town flexibility to higher calibrate funding quantities to assist builders meet the fluctuating price of initiatives.
Funds can cowl 30% of prices all the best way as much as 100%, relying on the challenge. Classes embrace multifamily development, inexpensive housing development, inexpensive housing preservation and development of adaptive reuse initiatives, akin to turning empty business buildings into housing.
The cash is awarded as both hole financing or gentle loans, which have little or no curiosity.
Critics of Measure ULA declare that the tax has stifled business growth and slowed gross sales. A UCLA report earlier this yr claimed that the chilled market led to a $25-million loss in property tax income.
Proponents, nevertheless, mentioned the UCLA report’s methodology was flawed, calling the measure an important fundraising software for town’s housing and homelessness-prevention initiatives.
