Article 3.2 - The Veterans Housing and Homeless Prevention Act of 2014

California Military and Veterans Code — §§ 987.001-987.011

Sections (11)

Added by Stats. 2013, Ch. 727, Sec. 3. (AB 639) Effective October 10, 2013. Note: Sections 987.01 through 987.31 are located in Article 3; Sections 987.50 through 987.93 are located in Article 3.1.

This article may be cited as the Veterans Housing and Homeless Prevention Act of 2014.

§ 987.002

Added by Stats. 2013, Ch. 727, Sec. 3. (AB 639) Effective October 10, 2013.

(a)The purpose of this article is to provide the acquisition, construction, rehabilitation, and preservation of affordable multifamily supportive housing, affordable transitional housing, affordable rental housing, or related facilities for veterans and their families to allow veterans to access and maintain housing stability.

(b)A program established under this article shall be restricted to

veterans and their families.

(c)The California Housing Finance Agency, the Department of Housing and Community Development, and the Department of Veterans Affairs, herein after “departments,” shall work collaboratively pursuant to the memorandum of understanding, as specified in Section 987.006, to carry out the duties and functions of this article.

§ 987.003

Amended by Stats. 2024, Ch. 918, Sec. 1. (AB 535) Effective September 29, 2024.

As used in this article:

(a)“Affordable rental housing” shall mean a rental housing development, as defined in subdivision (d) of Section 50675.2 of the Health and Safety Code, with affordable rents, as defined in subdivision (a) of Section 50675.2 of the Health and Safety Code, but neither definition is restrictive to only projects with five or more units.

(b)“Extremely low income” has the same meaning as defined in Section 50106 of the Health and Safety Code.

(c)“Homeless” has the same meaning as defined in Section 578.3 of Title 24 of the Code of Federal Regulations, as that section read on January 10, 2019.

(d)“Qualified entity” means an entity that is responsible for making referrals of qualified tenants to qualified units.

(e)“Qualified tenant” means an extremely low income veteran who is homeless.

(f)“Qualified unit” means a supportive housing unit restricted to extremely low income veterans pursuant to this article.

(g)“Secondary tenants” means a veteran who is homeless and has an income of up to 60 percent of the area median income.

(h)“Supportive housing” has the same meaning as defined in subdivision (h) of Section 50675.2 of the Health and Safety Code, but is not restrictive to only projects with five or more units.

(i)“Transitional housing” has the same meaning as defined in subdivision

(i)of Section 50675.2 of the Health and Safety Code, but is not restrictive to only projects with five or more units.

(j)“Veteran” means any person who served in the active military, naval, or air service of the United States, or as a member of the National Guard who was called to and released from active duty or active service, for a period of not less than 90 consecutive days or was discharged from the service due to a service-connected disability within that 90-day period.

§ 987.004

Added by Stats. 2013, Ch. 727, Sec. 3. (AB 639) Effective October 10, 2013.

The administration of this article is vested solely in the departments. Total costs of administering this article shall not exceed 5 percent of the bond funds issued.

§ 987.005

Amended by Stats. 2025, Ch. 67, Sec. 150. (AB 1170) Effective January 1, 2026.

(a)The departments shall establish and implement programs pursuant to the purposes of this article that focus on veterans at risk for homelessness or experiencing temporary or chronic homelessness. To the extent feasible, the departments shall establish and implement programs that, among other things, do the following:

(1)Leverage public (federal, state, and local), private, and nonprofit program and fiscal resources.

(2)Ensure projects combine housing and supportive services, including, but not limited to, job training, mental health and drug treatment, case management, care coordination, or physical rehabilitation.

(3)Promote

public and private partnerships.

(4)Foster innovative financing opportunities.

(5)Ensure program guidelines and terms provide threshold requirements to advance applicants with experience in combining permanent or transitional housing, or both, with supportive services for veterans, or for partnering with housing developers or service providers with experience offering housing or services to veterans.

(b)(1) The departments shall ensure at least 50 percent of funds awarded for capital development under this article provide housing to veteran households with extremely low incomes.

(2)Except as provided in paragraph (5) and subdivision (h), in determining whether a potential tenant is eligible for supportive, affordable, or

transitional housing targeted to extremely low income households under this provision, eligibility shall take into consideration all of a household’s income sources upon initial tenancy.

(3)At least 60 percent of units funded targeting extremely low income households shall be supportive housing.

(4)This section shall not deter the departments from funding projects serving mixed-income populations.

(5)(A) A qualified entity tasked with making referrals to qualified units targeted to extremely low income households may submit a petition to the departments pursuant to subdivision (c) for the purposes of requesting authority to lease the qualified unit to secondary tenants if the qualified entity is unable to locate, match, or otherwise place a qualified tenant in a qualified unit within 60 days

of the unit becoming available. The qualified entity may submit an application to the departments 30 days after the unit becoming available for occupancy, provided that the unit is vacant for at least 60 days at the time the departments approve the petition. The departments may not approve a petition if it would result in any changes other than tenant income eligibility criteria, as described in this section, that may impact the project’s regulatory agreement.

(B)This shall include circumstances in which approving a petition for a qualified entity to house tenants with incomes up to 60 percent of the area median income would cause a supported development to have less than 50 percent of its units occupied by tenants with extremely low incomes. The supported development shall not have less than 30 percent of its units occupied by tenants with extremely low incomes.

(C)If a

qualified unit that is restricted to a qualified tenant with an extremely low income is occupied by a secondary tenant or other tenant who is a veteran experiencing homelessness with an income between 30 and 60 percent of area median income pursuant to subparagraph (A) or (B), that unit shall be redesignated to an area median income level commensurate with the income level of the secondary tenant and the secondary tenant shall pay rent commensurate with their household income’s percentage of the area median income.

(D)Beginning 12 months after the petition has been approved, if a qualified unit that is restricted to a qualified tenant with an extremely low income is occupied by a secondary tenant or other tenant who is a veteran experiencing homelessness with an income between 30 and 60 percent of area median income pursuant to subparagraph (A) or (B), the next available comparable unit shall then be rented to a qualified tenant at 30 percent

of the area median income with the goal of returning the project into compliance with the unit mix required by the project regulatory agreement.

(6)The qualified entity tasked with making referrals to these units shall make a good faith effort to match a tenant with an extremely low income before submitting a petition to the departments, document these good faith efforts, submit this documentation as part of the petition, and make this documentation available to the housing sponsor, who shall include the documentation in the tenant file, and, upon request, to the departments. Documentation of these good faith efforts shall include, but not be limited to, the following:

(A)Efforts to advertise to the community at least 90 days prior to the lease-up of the building.

(B)Efforts to work in partnership with local

homeless services providers, including those that serve veterans experiencing homelessness.

(C)Efforts to coordinate with the local continuum of care to identify veterans experiencing homelessness with extremely low incomes.

(D)Efforts to coordinate with the United States Department of Veterans Affairs to identify veterans experiencing homelessness with extremely low incomes.

(E)Documentation of contact with veterans experiencing homelessness with extremely low incomes and their case managers who were matched to the available unit and chose not to lease the unit.

(c)The departments shall create a standardized form for the submission of petitions described in paragraph (5) of subdivision (b).

(1)Upon receiving a petition pursuant to this section, the departments shall do both of the following:

(A)Review the petition and decide if the qualified unit is eligible to accept secondary tenants under all applicable guidelines, rules, and regulations, and other laws established by the Internal Revenue Service and the departments.

(B)Provide a written determination approving or denying the petition. The written determination shall be provided to the qualified entity as soon as possible, but no later than 30 days after the departments receive the petition.

(2)If necessary, the departments may create written rules for the review of and determination on the petitions that are consistent with the requirements of this section, including, but not limited to, additional rules related to projects seeking

approval before permanent loan conversion.

(d)The departments may review, adopt, amend, and repeal guidelines or terms, or both, to implement this article. Any guidelines or terms adopted to implement this article shall not be subject to Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code.

(e)Nothing in this article permits the departments or the board to purchase, operate, or manage properties except in the event of a foreclosure on a borrower or grantee.

(f)(1) Notwithstanding any other law, a housing developer or service provider that provides housing or services pursuant to this article may provide housing or services to female veterans and their children in women-only facilities in limited instances in which a female veteran (A) has

suffered any form of sexual abuse, trauma, or intimidation or harassment while serving in the military and is seeking treatment for that sexual abuse, trauma, or intimidation or harassment, or (B) is seeking the housing or services as a result of being a victim of sexual abuse or domestic violence.

(2)A housing developer or service provider that provides housing or services to female veterans in women-only facilities pursuant to paragraph (1) shall ensure that the housing or services shall provide supportive housing or services with a focus on, among others, treating the effects of military sexual abuse, trauma, or intimidation in a gender-specific manner.

(3)For purposes of this subdivision, “women-only facilities” means the facilities may house and provide services to female veterans only and their children, and shall not house or provide services to any adult who is not a

dependent of a female veteran.

(g)In administering the programs established under this article, the departments shall do all of the following:

(1)Make program funds available at the same time funds, if any, are made available under the Multifamily Housing Program (Chapter 6.7 (commencing with Section 50675) of Part 2 of Division 31 of the Health and Safety Code).

(2)Rate and rank applications in a manner consistent with the Multifamily Housing Program (Chapter 6.7 (commencing with Section 50675) of Part 2 of Division 31 of the Health and Safety Code), except that the department may establish additional point categories for the purposes of rating and ranking applications that seek funding pursuant to this article in addition to those used in the Multifamily Housing Program.

(3)Administer funds subject to this article in a manner consistent with the Multifamily Housing Program (Chapter 6.7 (commencing with Section 50675) of Part 2 of Division 31 of the Health and Safety Code).

(4)Only applications serving veterans and meeting any additional threshold requirements established by the departments, shall be eligible to receive funds pursuant to this article.

(h)In determining whether a potential tenant is eligible for supportive, affordable, or transitional housing under this article, an income eligibility determination shall not take into consideration service-connected disability benefits received by the potential tenant.

§ 987.006

Added by Stats. 2013, Ch. 727, Sec. 3. (AB 639) Effective October 10, 2013.

(a)No later than August 15, 2014, the departments shall enter into a memorandum of understanding to address their respective and shared responsibilities in implementing, overseeing, and evaluating this article.

(b)No later than August 15, 2014, the departments shall submit the memorandum of understanding to the Senate and Assembly Budget Committees.

§ 987.007

Added by Stats. 2013, Ch. 727, Sec. 3. (AB 639) Effective October 10, 2013.

The departments shall convene a stakeholder process to inform the development of guidelines for the implementation of any program pursuant to this article. Stakeholders represented shall include, but not be limited to, organizations that have experience providing housing or homeless services, or both, to veterans, housing developers, and public and private agencies that serve the veteran population.

§ 987.008

Added by Stats. 2013, Ch. 727, Sec. 3. (AB 639) Effective October 10, 2013.

(a)Pursuant to guidelines or terms developed pursuant to this article, a housing provider or sponsor may redesignate units within a project, so long as the same number of units financed under this act remain restricted to veterans and their families.

(b)Pursuant to guidelines or terms pursuant to this article, any units financed as supportive or transitional housing units for veterans may be

redesignated as affordable rental or supportive housing to allow a veteran resident to remain housed in the project.

§ 987.009

Added by Stats. 2013, Ch. 727, Sec. 3. (AB 639) Effective October 10, 2013.

Notwithstanding Section 13340 of the Government Code, the proceeds of bonds deposited in the Housing for Veterans Fund pursuant to Section 998.544 shall be subject to annual appropriation, as determined by the Legislature.

§ 987.010

Repealed (in Sec. 21) and added by Stats. 2020, Ch. 192, Sec. 22. (AB 434) Effective January 1, 2021. Section operative January 1, 2022, by its own provisions.

(a)For any loans issued pursuant to this article, loan terms shall be consistent with Section 50675.6 of the Health and Safety Code.

(b)All moneys received by the department in repayment of loans made pursuant to this article, including interest and payments in advance in lieu of future interest, shall be deposited in the Housing Rehabilitation Loan Fund established by Section 50661 of the Health and Safety Code, and notwithstanding Section 13340 of the Government Code, are continuously appropriated to the department for the purposes of the Multifamily Housing Program (Chapter 6.7 (commencing with Section 50675) of Part 2 of Division 31 of the Health and Safety Code), except as otherwise provided in this section.

(c)The department may designate an amount not to exceed 1.5 percent of funds appropriated for use pursuant to subdivision (b) for the purposes of curing or averting a default on the terms of any loan or other obligation by the recipient of financial assistance, or bidding at any foreclosure sale where the default or foreclosure sale would jeopardize the department’s security in the rental housing development assisted pursuant to this article. The funds so designated shall be known as the “default reserve.”

(d)The department may use default reserve funds made available pursuant to this section to repair or maintain any rental housing development assisted pursuant to this article that was acquired to protect the department’s security interest.

(e)The payment or advance of funds by the department pursuant to this section

shall be exclusively within the department’s discretion, and no person shall be deemed to have any entitlement to the payment or advance of those funds. The amount of any funds expended by the department for the purposes of curing or averting a default shall be added to the loan amount secured by the rental housing development and shall be payable to the department upon demand.

(f)All moneys set aside for the default reserve by the department pursuant to this section shall be deposited in the Housing for Veterans Fund established by Section 998.544, and, notwithstanding Section 13340 of the Government Code, are continuously appropriated to the department for the purposes of the default reserve set forth above in this section.

(g)For the purposes of this section, “department” means the Department of Housing and Community Development.

(h)This section shall become operative on January 1, 2022.

§ 987.011

Added by Stats. 2024, Ch. 491, Sec. 8. (SB 1500) Effective January 1, 2025. Inoperative on or after July 31, 2025, by its own provisions. Repealed January 1 following the inoperative date.

(a)(1) In the City and County of Los Angeles, where the federal Department of Housing and Urban Development has granted an authority, as defined in Section 34203, a waiver effective August 17, 2024, to allow household income

verifications to occur after a lease contract is signed for unhoused populations seeking entry into projects pursuant to or in connection with Section 5.110 of Title 24 of the Code of Federal Regulations, if an owner or a management agent leases a subsidized unit to an unhoused person and subsequently learns

and verifies that the unhoused person does not meet applicable income requirements, then the department shall not take any negative actions against the owner or management agent if both of the following conditions are met:

(A) The owner or management agent has cured the noncompliance within 24 months of discovery of the violation.

(B) The local housing authority and continuum of care have developed and posted on their respective internet websites a plan describing how the local housing authority and continuum of care will coordinate with the owner or management agent to move tenants that do not meet applicable income requirements into affordable housing where the tenant is eligible for occupancy within 24 months of discovery of the violation. Income ineligible tenants shall retain their unhoused targeting eligibility.

(2)For purposes of this

subdivision, “negative actions” include, but are not limited to, both of the following:

(A)Issuing negative points on a current or future application.

(B)Imposing a financial penalty.

(b)If an agreement between the owner or management agent and the authority or the departments restricts a unit to a tenant earning no more than 30 percent of the area median income, the tenant shall be deemed to satisfy

the income requirements of this program during the 24-month period described in paragraph (1) of subdivision (a) if all of the following conditions are met:

(1)The tenant experienced homelessness prior to moving into the unit. For purposes of this paragraph, “homelessness” has the same meaning as “homeless,” as that term is defined in Section 578.3 of Title 24 of the Code of Federal Regulations.

(2)The tenant self-certified household income at no more than 30 percent of the area median income.

(3)A third-party verification shows that the tenant has household income of no more than 50 percent of the area median income, unless the tenant is otherwise eligible pursuant to federal income eligibility requirements.

(4)The tenant’s income certification is fully verified in accordance with the program rules within 90 days of the date the tenant took possession of the unit.

(5)At least 50 percent of the assisted units restricted to 30 percent area median income are occupied by verified, income-eligible households.

(6)The issuing housing authority and continuum of care, in coordination with other public agencies, coordinate with an owner or a management agent and move a tenant found to have a household income of more than 50 percent of the area median income following third-party verification described in paragraph (3) within 24 months of discovery of the violation to an affordable housing unit for which the tenant is eligible without reliance upon the same waiver described in subdivision (a). Income ineligible tenants shall retain their unhoused targeting eligibility.

(c)(1) This section does not modify any other eligibility requirements attached to assistance provided by the Department of Housing and Community Development.

(2)Tenant self-certified date of birth shall be accepted so long as the agreement

between the department and the owner does not impose age-based demographic targeting requirements.

(3)If the conditions described in subdivision (b) are met, absent any rent setting methodology from subsidy programs, a tenant whose adjusted income at move-in exceeded 30 percent area median income shall have an effective rent limit for their unit be redesignated to 50 percent of area median income or, if the tenant’s verified income is higher than 50 percent of area median income, an effective rent limit for their unit be redesignated to an area median income level commensurate with the income level.

(4)Owner or management agents shall discontinue use of the waiver as described in subdivision (a) in the event that more than 50 percent of the assisted units restricted to 30 percent area median income are occupied by households with adjusted incomes at move-in over 30 percent area

median income.

(d)This section shall become inoperative on July 31, 2025, or the final expiration date of a waiver as described in subdivision (a), whichever is later, and, as of January 1 of the following year, is repealed.