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 expenses a switch tax to all L.A. property gross sales above $5 million.
Functions 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 neighborhood 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 building, 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 applications — represents the town’s largest 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 might be overturned in court docket.
As authorized challenges light, the town handed a $150-million ULA spending plan final 12 months and a $425-million spending plan in July.
Johnson Corridor mentioned the division doles out funding to housing initiatives each few years, however sometimes inside the vary of $50 million to $75 million, so the $387-million NOFA is a large step up. Since Measure ULA is a continuous supply of funds, the Housing Division might be releasing new funding on a yearly foundation going ahead.
Usually, every spherical of funding receives about 30 to 35 purposes from builders, although this spherical most likely will appeal to extra since there’s more cash to go round.
The funding marks a strategic shift as the town seems to expedite building within the midst of a housing disaster. In earlier rounds of funding, the town doled out cash primarily based on the variety of items in a mission. This time, funding is predicated on a proportion of growth prices, and builders will obtain larger awarded quantities than they normally do.
Johnson Corridor mentioned the brand new strategy offers the town flexibility to raised calibrate funding quantities to assist builders meet the fluctuating value of initiatives.
Funds can cowl 30% of prices all the way in which as much as 100%, relying on the mission. Classes embrace multifamily building, inexpensive housing building, inexpensive housing preservation and building of adaptive reuse initiatives, akin to turning empty business buildings into housing.
The cash is awarded as both hole financing or tender 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 12 months claimed that the chilled market led to a $25-million loss in property tax income.
Proponents, nonetheless, mentioned the UCLA report’s methodology was flawed, calling the measure an important fundraising software for the town’s housing and homelessness-prevention initiatives.
