Bill > SB686

This bill amends the Zenovich-Moscone-Chacon Housing and Home Finance Act to modify regulations for property owners with regulatory agreements with the California Department of Housing and Community Development. The bill expands the conditions under which property owners can take out additional debt on affordable housing developments by allowing reimbursement of borrower advances for predevelopment costs, unreimbursed capital improvements, and unreimbursed operating deficits. It revises the definition of "extracted equity" to mean distributed funds financed by debt secured by a department-regulated property that is not used for specific prescribed purposes. The bill maintains existing requirements that additional debt must be underwritten with a minimum debt-service coverage ratio of 1.15 and demonstrate positive cash flow for 15 consecutive years. The department's regulatory agreement remains in place, and the property owner must continue to pay monitoring fees. The changes aim to provide more flexibility for affordable housing property owners in managing their financial resources while maintaining regulatory oversight and ensuring the long-term sustainability of affordable housing projects.

Budget and Finance, Housing and Urban Affairs

https://leginfo.legislature.ca.gov/faces/billStatusClient.xhtml?bill_id=202520260SB686