PMIB & STATE BUDGET UPDATES (please recheck this blog as we update frequently)
UPDATED: June 11, 2009
Answers from June 8, 2009, meeting with Lynn Jacobs and Chris Westlake
The purpose of the meeting was to gain a more specific understanding of how HCD intends to fund existing projects using the limited funds available from the April bond sale and fund future projects. Additionally, we advocated for the coalition's funding priorities.
Please click on the link to download the notes.
UPDATED: May 20, 2009
Notes from the meeting with the PMIB (arranged by Sen. Kehoe)
On May 13th State Senator Kehoe (from the San Diego area) arranged a meeting with members of the Housing CA PMIB coalition, HCD and representatives of the PMIB agencies. Attached are notes from that meeting, courtesy of Housing CA's policy director, Julie Snyder. It contains some useful information on the current state of "bond freeze" affairs, some of which was repeated at the SCANPH forum last Friday.
Link to the notes here.
UPDATED: May 8, 2009
HCD Funding Uncertain
(from Housing CA.) PMIB UPDATE: HCD FUNDED THROUGH JUNE OR NOVEMBER (MAYBE)
On April 30, 2009, the California Department of Housing and Community Development (HCD) issued a memo outlining how it will spend approximately $539.5 million allocated to the department by the California Department of Finance out of the April bond sales.
In a reversal of prior pronouncements, both taxable and tax-exempt proceeds will be used to fund Proposition 46 (2002) and 1C (2006):
• $332.3 million for Proposition 1C ($209 million taxable, $123.3 million tax-exempt)
• $207.2 million for Proposition 46 ($162.2 million taxable, $44.3 million tax exempt)
Although the HCD memo includes lists of developments awarded Prop. 46 and 1C funds, it states the lists are not in order of priority. Instead, "expenditures will be made as projects meet their disbursement conditions, based on availability of funds at the time."
According to previous HCD estimates, $539 million is roughly half the amount the department needs to cover its commitments through June 2010. Added to the March infusion of $182 million from the Pooled Money Investment Account, it should allow the department to pay any draws submitted through November 2009.
In a continuing quest to get answers to these, and other, questions, the PMIB Coalition will meet with HCD and, possibly, the state treasurer's office soon. Additionally, legislators may call a meeting in an attempt to secure definitive answers that will lift the cloud of confusion and allow job-creating, revenue-generating home construction to proceed unhindered.
For information on your specific development(s), contact your HCD loan officer, Chris Westlake, or Lynn Jacobs at 916.445.4775.
Contact: Julie Snyder, 916.447.0503 x102 or jsnyder@housingca.org
UPDATED: May 1, 2009
HCD memo released on April 30, 2009 regarding funds received from state bond sales
HDC released a memorandum on receiving funds from the state's most recent sale of bonds. To download, please visit http://www.scanph.org/files/PMIBUpdate4.30.09.pdf
UPDATED: April 24, 2009
Bond Sale Could Cover HCD Through June 2010
(from Housing California) State Treasurer Bill Lockyer announced yesterday morning the completed sale of $6.85 billion in taxable, general obligation bonds. Governor Arnold Schwarzenegger pronounced soon after that "California will now have the necessary funding to restart all general obligation bond funded projects that had been frozen."
Up to $1.7 billion of the taxable bond proceeds will be available for frozen home and shelter developments authorized by propositions 46 and 1C. Other potential uses of the $1.7 billion are high-speed rail and stem-cell research.
The remaining $5.2 billion from newly authorized Build American Bonds (BABs) can only be used for the same purposes as tax-exempt bonds, which the treasurer's office has determined excludes home and shelter developments. Due to a federal subsidy, these bonds are less expensive for the state than tax-exempt bonds.
Lockyer indicated in the past months that he supported allocating as much as $1 billion of the non-BABs to home and shelter developments.
Members of the ad hoc PMIB Coalition have requested a meeting with Department of Finance Director Mike Genest. We will urge him to allocate at least $1.2 billion from the taxable sale to fulfill Department of Housing and Community Development (HCD) contracts for home developments through June 2010. Additionally, we will request that he lift the prohibition on HCD's loan and grant committee making new awards. Proceeds of the sale are likely to be available to HCD by late May.
Contact: Julie Snyder, 916.447.0503 x102 or jsnyder@housingca.org
UPDATED: April 23, 2009
California Department of Finance releases list of projects that will restart funding
The following projects were affected by the December 2008 funding freeze. With the April 22, 2009 GO bond sale, resources are being provided to restart the projects and funding will be provided consistent with either project contracts or grant criteria.
The released projects are now on the DOF website - see http://www.dof.ca.gov/capital_outlay/funding_released/
UPDATED: April 7, 2009
Quick Notes from the April 6 PMIB meeting - from NPH Policy Director Ann Gressani
(from notes by NPH Policy Director Ann Gressani) PMIB approved $158 million for HCD, this will be for the projects on the HCD cash flow spreadsheets showing need through the end of March. We learned that it took two weeks from the tax exempt sale for the funds to be allocated so we can likely expect a similar timeline from the taxable bond sale. The taxable bond sale will go to market in the next 10 ten days. HCD has a request at next Wednesday's regularly scheduled PMIB meeting for $1 billion dollars from that sale. This would cover HCD through 2009. HCD not signing contracts still remains an issue. PMIB says this is a DOF issue.
PLEASE CONTACT PMIB & YOUR LEGISLATORS
UPDATED: APRIL 7, 2009 * ONGOING *
ATTN: SCANPH MEMBERS - When the State is able to resume selling bonds, it is crucial that the early proceeds are used to honor housing program commitments. As funds become available to the PMIB, the top priority should be to fund fully or partially completed home developments that need their committed Multifamily Housing Program (MHP), self-help, or Housing and Community Development (HCD) program funds now or in the next four months to allow them to pay off construction loans as well as home developments under construction that are drawing down from HCD funding and need to draw the rest of their committed amounts to complete construction.
Additionally, a concerted state agency effort is needed to reassure financial institutions that construction funds loaned to developments that have state commitments will be repaid when they are due.
If you are an affordable home builder with a committment from HCD, MPH, or self-help funding, SCANPH is urging your organization to send letters to your members' of the California Legislature - urging their support and help to prioritize available PMIB funds to honor housing program commitments. A template is enclosed that you can fill in with information on your organization. Link here for a MS Word version or here for an Adobe pdf version.
To find your legislators, please visit http://www.votesmart.org/
Please send us a copy of your letter via email rdhondrup at scanph.org or fax 213. 480. 1788 ATTN: SCANPH Communications. For information, please contact Robert Dhondrup at 213.480.1249.
Housing CA has also provided a very useful Talking Points fact sheet with key messages and information if you would like to craft and fax your own letter as well.
Please continue to fax letters to the PMIB:
SCANPH is urging all Southern California affordable home builders and advocates to send letters to the members' of the PMIB. A template is enclosed that you can fill in with information on your organization. Link here for a MS Word version or here for an Adobe pdf version. Fax your letters to:
State Treasurer Bill Lockyer
Chair, Pooled Money Investment Board (PMIB)
915 Capitol Mall, Room 106
Sacramento, CA 95814
via fax (916) 653-3125
State Controller John Chiang
Member, Pooled Money Investment Board (PMIB)
915 Capitol Mall, Room 106
Sacramento, CA 95814
via fax (916) 322-4404
Michael C. Genest, Director of Finance
Member, Pooled Money Investment Board (PMIB)
915 Capitol Mall, Room 106
Sacramento, CA 95814
via fax (916) 324-7311
Please send us a copy of your letter via email rdhondrup at scanph.org or fax 213. 480. 1788 ATTN: SCANPH Communications. For information, please contact Robert Dhondrup at 213.480.1249.
Housing CA has also provided a very useful Talking Points fact sheet with key messages and information if you would like to craft and fax your own letter to the PMIB.
UPDATED: April 3, 2009
Housing CA has organized a regular conference call on PMIB issues-here are Paul Zimmerman's notes from the Housing CA. PMIB call on April 2nd
Housing CA PMIB coalition call, April 2, 2009
1.A. Summary of Lynn Jacobs meeting: Rob highlighted a few points, including HCD's belief that their programs can be funded by both taxable and tax-exempt bonds. Additionally, Lynn feels strongly that bringing tenants and others affected by the freeze to the PMIB hearings is effective.
1.B. Report on conversations between Julie Snyder and Treasurer's staff (Bill Dowell and Nini Redway)
• DOF is recommending that $148 M from monies now in hand (the cash account-not bond proceeds) be allocated at Monday's PMIB meeting to HCD, which could cover their obligations through March. According to Chris Westlake, HCD is still working with DOF to specify exactly which projects will be funded. (HCD is maintaining its position that the priority should be based on when the funds are needed.)
• In early April, there will be 2 new bond sales, one of which will be taxable. Besides housing, few other types of infrastructure are able to use taxable bonds.
• Housing is high on Dept. Of Finance priorities. They may be willing to use the proceeds from the taxable sale to cover HCD through the end of year.
• It is the Treasurer's goal to have a "road map" that shows how the April bond proceeds will be spent and what can be expected for the rest of the year. The Treasurer has asked DOF to prepare this map.
2. Bond counsel opinions on use of tax-exempts proceeds for home developments: Participants on the call still want to get more clarity on the rules for using taxable vs. tax-exempt bond proceeds to fund housing programs. Jacques Pelham, Matt Packard and others who've had conversations with DOF and the treasurer's staff volunteered to seek a written explanation from some friendly bond counsels.
3. Interpretations of DOF recommendations: See 1B
4. Next Steps: Concern was expressed that the taxable bond sale in April may not be successful. Given these concerns, should we increase our "ask" for part of the tax-exempt proceeds or more than $148 M from the cash account? People were sensitive to not appearing unreasonable and angering the PMIB, but scared about the uncertainty of relying on a bond sale that has not yet happened.
5. Preparation for April 6 PMIB meeting: Having a strong presence is important. Several participants mentioned that they will be attending. Most will speak at public comment on the damage being done to investor and lender confidence to the whole system. People will ask for a commitment of funding to cover several quarters' worth of need, or to the end of the year (about $800 M) regardless of how the April sale works out. (see Agenda).
UPDATED: April 2, 2009
NOTES FROM HOUSING CA. MEETING WITH HCD DIRECTOR LYNN JACOBS
Notes from Housing CA's Meeting with Lynn Jacobs on March 27, 2009
• Lynn thinks that HCD programs can be funded from both taxable & tax-exempt bond proceeds, but the Treasurer's office and Dept. of Finance has been saying that only taxable proceeds can flow to HCD.
• At the next PMIB meeting $2.54 billion of tax-exempt, from the total bond sale proceeds of over $6 billion, is a little bit up from grabs. It is up for grabs because although the members of the board have delegated deciding how funds will be spent to the Dept. of Finance, the decision must still be made in an open hearing. If any member of the board decides to disagree with DOF's list it opens things up for discussion.
• There maybe a PMIB meeting on April 3rd , but the C. Chavez holiday may interfere. It not April 3rd it will then happen week after next, keep checking the PMIB web site.
• There will be another sale of bonds in late April. The current plan is to sell $2 billion in taxable bonds. At the next PMIB meeting, they may or may not continue to delegate setting the priorities for the sale of the next round of bonds to the DOF.
• All of this means we should really keep up the pressure on PMIB. If HCD does not get a share of the last, tax-exempt, bond sale-pressure may result in a larger share of the next, taxable, bond sale. However, after the next bond sale, that's it for quite as while as all sales stop pending the mid-year budget revisions-which could be lengthy this year.
• Each member of PMIB has different priorities - there seems to be no agreement among them about ranking. For example, some favor job creation as the most important criteria, some favor limiting the state's legal liability. We should stress all of these reasons to fund HCD. FYI - Lynn thinks that HCD is typically about 20% of most deals, so the state's liability is on average 5 times the face value of their loan obligation.
• Lynn is talking to DOF, but she does not have a sense of whether the board members will all just accept DOF's recommendations or individuals will assert their own priorities.
• None-the-less, we should continue to stress the importance of funding our projects and the down side of a continuing freeze. Our letter to Treasurer/Controller/Governor should include stories that personalize the impact to the people who will not be housed.
• For HCD their top priority is a commitment from PMIB for getting money every month or two so that they can continue their programs.
• HCD's second most important priority is finding a way to satisfying the banks, because the banks are now suggesting that they will need any loan commitments backed by real money in an escrow account. Lynn will try to arrange a confidence-building meeting, once some funds start flowing, between the banks and the Treasurer.
• Attending PMIB meetings is important. Julie Snyder and Rob Wiener will continue to coordinate the Housing CA effort.
UPDATED: March 25, 2009
(as reported by Housing CA) PMIB ALLOCATES UP TO $500 MILLION FOR INFRASTRUCTURE PROJECTS
At its March 18, 2009, meeting, the Pooled Money Investment Board (PMIB) voted to spend up to $500 million on bond-funded infrastructure projects. Now it is up to the state Department of Finance (DOF) to set priorities among nearly 6,000 road, home-development, school, and other projects waiting for funding.
A group of nonprofit developers and advocates met with DOF Chief Deputy Director Tom Sheehy on Monday to outline the job-generating, home-creating, and capital-leveraging benefits of prioritizing affordable home developments. DOF also will rely on a chart of "funding needs" developed by the state Department of Housing and Community Development.
This week, State Treasurer Bill Lockyer sold $2.5 billion more in tax-exempt general obligation bonds than expected. Lockyer's original bond offering of $4 billion grew to $6.54 billion due to strong investor demand.
Of the $6.54 billion, $3.93 billion will be used to repay the PMIB account for loans already made to various state departments.
According to the treasurer's office, the remaining $2.6 billion is available for infrastructure projects delayed or stopped because of the financing freeze imposed last December. Some Proposition 46 and 1C developments will be eligible for these funds, if the underlying program can use tax-exempt bond proceeds. Others will have to rely on the $500 million released by the PMIB from its cash account and a taxable bond sale that Locker hopes to hold in April.
Temporary Help from Feds?
On March 17, 2009, the California Tax Credit Allocation Committee (TCAC) issued its proposed regulations for spending federal stimulus funds. The regulations cover both the Tax Credit Assistance Program (TCAP) and Exchange Funds (grants in lieu of tax credit allocations).
According to TCAC staff, Section 1032(b)(3) is "placeholder language" signaling TCAC is prepared to use the federal funds to help resolve the PMIB problem. Staff is working to determine how much is needed by bond-funded projects and in what form. They are confident they will have solid answers by April 30, the deadline for adoption of final regulations.
UPDATED: March 16, 2009
(as reported by Housing CA) BOND SALE ANTICIPATED IN LATE MARCH
According to legislative staff, State Treasurer Bill Lockyer, is preparing to sell approximately $3 billion in general obligation bonds in late March. Investors' reception of the offering -- the first since July 2008 -- will determine how much the state must pay in interest. The treasurer's office estimates that a second bond sale of roughly $2 billion could occur in April if borrowing costs are not too high.
Proceeds from the bond sales can be used to fund loans made under propositions 46 and 1C, however any proceeds for housing will be competing with commitments against other sectors. The Department of Finance (DOF) most likely will make the final decisions on how to allocate the money.
DOF will rely on information from the Department of Housing and Community Development (HCD) to establish its priorities. HCD staff has information from developers about which developments need funds and when and has created a list. To insure your project is on the list, please see this link (for Prop 46) (for Prop 1C) funds.
The Pooled Money Investment Board (PMIB) is scheduled to meet on March 18, 2009. According to the treasurer's staff, the board will discuss the state's cash flow and the treasurer's plan to sell bonds. In a "best case scenario," they also will adopt a process for releasing money in stages when the state's cash flow improves.
Temporary Help from Feds?
At the urging of many nonprofit developers, Tax Credit Allocation Committee (TCAC) staff continues to explore whether any of the federal Tax Credit Assistance Program (TCAP) funds can be used as bridge loans for stalled developments that have tax credit financing. The initial response from the U.S. Housing and Urban Development Department (HUD) was not encouraging; they want to focus on creating new jobs through new construction.
The Southern California Association of Nonprofit Housing (SCANPH) and other organizations point out that the president specifically names retaining jobs as one of his top economic stimulus goals, and jobs will be lost if nonprofits go under as a result of the PMIB freeze.
TCAC expects to release draft regulations for the TCAP funds and the new federal exchange program later this week.
Fixing the Construction Loan Mess
HCD Director Lynn Jacobs met with representatives from banks on March 2, 2009, to urge them to make construction loans. Jacobs offered to modify HCD's estoppel letter to remove the new "paragraph 11" upon request. However, it's not clear whether this will fully alleviate bankers' concerns.
The treasurer's office is also urging banks with whom the state has significant deposits to continue making construction loans.
Keeping up the Pressure
The informal PMIB Coalition meets this afternoon to discuss strategies for maintaining pressure on DOF, Lockyer and State Controller John Chiang. Coalition members have written letters to all three and lobbied legislators in whose districts these developments are under construction. We will be meeting with DOF and the governor's staff within a few weeks.
UPDATED: February 27, 2009
SCANPH has sent the following letter to members of the PMIB today
State Treasurer Bill Lockyer
Chair, Pooled Money Investment Board (PMIB)
State Controller John Chiang and State Finance Director Michael C. Genest
Members, Pooled Money Investment Board (PMIB)
RE: URGE YOUR SUPPORT TO PRIORITIZE FUNDING FOR AFFORDABLE HOME DEVELOPMENT
When the State is able to resume selling bonds it is crucial that early proceeds are used to honor housing program commitments. Hundreds of affordable home developments are now in jeopardy across the state. During this period of economic turmoil, it is crucial that we do not lose these homes because the State's financing arrives too late.
It is easy to understand that housing construction creates much needed jobs. Less obvious is that homes affordable to low- and moderate-income families stabilize household budgets, increase consumer confidence, help revive struggling neighborhoods, as well as provide a decent, safe living environment for children, the elderly, and people with disabilities.
The Southern California Association of Non Profit Housing (SCANPH), representing over 400 affordable home builders and organizations in our industry urges your strong support to prioritize funding for affordable home development. Many of our members' projects are at risk of collapsing under the weight of holding costs and missed deadlines.
If these developments fail, the State will lose its investment as will local government and private investors. Their failure could create large legal and financial exposure for the California, with the State liable for the entire development costs. Additionally, the affordable rents or purchase prices will convert to market rates, making housing even less affordable for California's working families.
The collapse of the housing market created the financial meltdown. Fixing the market needs to be a key part of the solution. We urge your support and voice to fully fund affordable home developments as state bond proceeds become available to the Pooled Money Investment Board (PMIB).
Sincerely,
Paul Zimmerman
Executive Director
UPDATED: February 27, 2009
Report back from meeting of affordable home advocates with TCAC Director Bill Pavao
SCANPH continues to closely monitor the current situation of the bond freeze and federal stimulus package that will assist affordable home development in California. A meeting of SCANPH members had met with TCAC Director Bill Pavao on February 19, 2009 at the SCANPH offices. Pavao is meeting with stakeholders across the state to determine a plan of action for California's share of the new federal stimulus package that President Obama has signed.
As a followup to the meeting, SCANPH would like to post notes from the meeting as recorded by Perla Eston and wishes to thank her for sharing it with us (download
here).
UPDATED: February 6, 2009
Report back from meeting of affordable home advocates with PMIB representatives
SCANPH continues to closely monitor the current situation of the bond freeze. A meeting of affordable home advocates and Housing California had met with representatives of the PMIB earlier this week. From reports provided, the $650 million in bond funds that had been released has already been earmarked for the most urgent payments due from the state. As a followup to the meeting, affordable home advocates will be working with HCD to gather additional information on projects in urgent need. Adovcates across the state will also be attending the next scheduled PMIB meeting on February 18 in Sacramento.
Notes and Housing CA. PMIB Notice on PMIB Priorities (download
here)
UPDATED: January 23, 2009
Reports indicate some bond revenues being released
(from Capitol Watch) The state Pooled Money Investment Board (PMIB) relented on their December bond freeze, releasing $650 million in bond funds several days ago. The Department of Housing reports that some percentage of those funds will be for housing projects submitted for payment in December, but are still attempting to find out the dollar amount of the housing allocation. The PMIB plans to meet again in early February to consider further release of funds. Housing advocates are gearing up to make their case to the PMIB at their February meeting, where the Board will grapple with bond-funded projects around the state that have come to a standstill, workers laid off, and lawsuits in the offing over the state's failure to meet their financial obligations.
UPDATED: January 21, 2009
Housing California posted the following message on its website:
No Options for Stalled Bond Projects Until Legislature Passes Budget
The ongoing budget stalemate between Governor Schwarzenegger and the legislature leaves the Pooled Money Investment Board (PMIB) with no options for resuming loans that fund infrastructure projects, including 600 housing-related projects.
At its December meeting, PMIB indicated it might fund some transportation projects to avoid significant contract penalties. Aside from those projects, however, the board has run out of cash to make loans.
According to State Treasurer Bill Lockyer's office, the treasurer can only resume selling bonds to replenish the PMIB account if the governor signs a state budget that raises revenue and is not subject to a lawsuit. Without both of those components, investors will not buy the bonds. A state court recently rejected a lawsuit filed by legislative Republicans who objected to the Democrats' passage of majority-vote bills raising fees and taxes. Future lawsuits, though, would be possible if the governor signs a similar bill.
The treasurer recognizes infrastructure projects' positive economic impact and is anxious to resume funding them. Every 1,000 new apartments built creates 1,330 jobs and $7.1 million in revenues for local governments.
TAKE ACTION! Voice Your Concerns About the Loan Suspensions
Write to legislative leaders and the governor:
Governor Arnold Schwarzenegger - fax 916. 445.4633
Senate President pro Tempore Darrell Steinberg - fax 916.323.2263
Senator Dave Cogdill - fax 916.327.3523
Assembly Speaker Karen Bass - fax 916.319.2127
Assemblymember Mike Villines - fax 916.319.2129
Also write to your own legislators.
In your letter, outline the impacts of your stalled development(s), including the number of jobs that might be lost. Urge them to adopt a balanced budget solution that raises taxes on high-income earners and does not reduce benefits to the lowest-income households. Contact Julie Snyder, (916) 447-0503 x 102 or jsnyder@housingca.org.
UPDATED: January 16, 2009
Governor Announces His 2009-2010 Budget & State Prepares To Issue IOUs
The California state budget crisis' continues to deliver bad news for advocates for affordable homes. Governor Arnold Schwarzenegger delivered his State of the State address this week and announced that he will seek to grab $226 million of Mental Services Act funding by amending the language of Proposition 63. Luckily, Senate President proTem Darrell Steinberg declared the Governor's efforts as "DOA" when it will arrive to the legislature.
In his address, Governor Schwarzenegger also announced cuts of $4.2 million and elimination of 22 staff positions for the HCD Manufactured Home Program which provides registration and titling of mobile homes and inspection of parks, cuts of $668,000 for the Office of Migrant Services (OMS) which rehabilitates and runs migrant worker centers, elimination of all $154,000 in general fund monies for the State Employee Housing Program which inspects farm worker and other employer housing.
Despite the bond and NOFA freeze on Proposition 46 and Proposition 1C funding, the Governor's new budget proposals also call for 2009-2010 NOFAs that include $34 million for TOD programs, $190 million for infill programs, $27 million for EHAP capital programs, $31 million for farm worker housing, $19 million for homeless youth programs, $83 million for supportive housing programs, $50 million for CalHome, $40 million for BEGIN, $3 million for self-help housing, $10 million for parks, and finally $41 million for the affordable housing innovation fund.
With the budget crisis' taking its toll on state services, the HCD is slated to place staff for furlough on the first and third Friday's of the month beginning on February 6, 2009. All state departments are subject to the furlough saving 10% of the state General Fund. Directors, managers, and others may work but would receive a pay cut. A lawsuit has been filed challenging the governor's authority to require a furlough of state employees. All but one of the state's constitutional officials and the legislature have announced they will not furlough employees.
This week State Controller John Chiang also announced that cash shortages expected in February will force him to delay some critical payments in the state's budget next month in order to preserve cash flow and protect payments the state must make to fund education and repay outstanding debts. A full listing is available at http://www.sco.ca.gov/eo/fiscalissues/payments01-2009a.shtml
UPDATED: December 22, 2008
Board's Action Freezes Most Disbursements and NOFAs
On Friday, representatives of Housing California [
http://www.housingca.org ] and the Affordable Homes Collaborative talked with Chris Westlake, deputy director at the Department of Housing and Community Development (HCD). [
http://www.hcd.ca.gov ] Westlake outlined the specific impacts of last Wednesday's action by the Pooled Money Investment Board [
http://www.treasurer.ca.gov/pmia-laif/ ] (PMIB):
• Disbursements: If HCD submitted a warrant for a draw to the state controller before December 17, 2008, the disbursement will be made. All others are frozen indefinitely. Developers who are uncertain about the status of their disbursement should contact the program manager. In order for disbursements to resume, the legislature must pass a new budget and the treasurer must sell more bonds.
• Other awardees: HCD intends to honor all awards it has made. However, there will be no disbursements until the PMIB resumes loaning funds.
• Pending applications for the Multifamily Housing Program: HCD does not yet know whether these applications will be reviewed by the Loan and Grant Committee in January.
• Notices of Funding Availability: No NOFAs will be issued for the foreseeable future. Programs affected by this suspension include the Infill Incentive Grant Program and the Transit-Oriented Development Program, both of which HCD expected to issue NOFAs for this month.
Westlake additionally clarified that the list of projects published by PMIB [ http://www.treasurer.ca.gov/pmia-laif/pmib-staff/20081217_appendix.pdf ] includes all Proposition 46 and 1C awardees as of June 30, 2008, that have not drawn down the full amount they were awarded. The list contains 600 projects awarded approximately $1.6 billion. HCD cannot definitely say which of the 600 projects will be delayed by the board's action, because some may not need funds until after the board resumes making loans.
Housing California will continue to bring you updates as this situation changes.
Contact: Contact Julie Snyder, (916) 447.0503 x102 or jsnyder@housingca.org .
UPDATED: December 19, 2008
Memorandum for HCD Customers from HCD Deputy Director Chris Westlake
As many of you may have heard, the Pooled Money Investment Board (PMIB) voted yesterday to defer all bond expenditures from the Pooled Money Investment Account (PMIA) until the State's budget shortfall is resolved. In effect, this freezes any expenditures from the PMIA, until they meet again in early January. The PMIB is governed by a board consisting of three members; the Treasurer, the Controller and the Director of Finance. The Treasurer made this recommendation due to the continued decrease of available cash in the PMIA as well as the state's inability to sell bonds or obtain commercial paper. HCD's bond funded programs rely on PMIA loans to fund projects, including single-family homes, multifamily rental units, shelter spaces and infrastructure, during the interim time that bonds are sold.
This means there will be delays in our ability to provide expenditures for HCD bond awarded projects as of December 17, 2008. At this time, we do not know when we will be able to provide expenditures. We do not expect that prior commitments and awards that have been made will be in jeopardy.
Until the PMIB begins loaning money again, HCD will have to temporarily suspend Notices of Funding Availability (NOFA). This means that the Infill Incentives Grant Program, Transit Oriented Development Program, MHP, CalHome Project, BEGIN, EHAP-CD and LHTF NOFAs are temporary being suspended or delayed until further notice. Current applications that are being rated and ranked may be delayed from being presented at the upcoming Loan and Grant meetings.
As soon as we have additional information, we will be posting it on our website, www.hcd.ca.gov and sending e-mail blasts to our stakeholders. If you have additional . questions, please contact me at 916-322-1560.
UPDATED: December 18, 2008
HCD posted the following message on its website today:
"The Pooled Money Investment Board (PMIB) took action today that will affect HCD's bond funded programs. In a unanimous vote the Pooled Money Investment Board voted to freeze disbursements of cash to bond-funded programs until California's budget shortfall is resolved. HCD's bond funded programs rely on Pooled Money Investment Account (PMIA) loans to fund projects, including single-family homes, multifamily rental units, shelter spaces and infrastructure. Until the PMIB begins loaning money again, HCD will have to temporarily suspend Notices of Funding Availability (NOFA)."
Please keep visiting the SCANPH website for updates and additional information. We'll keep you posted as we learn more.
