CalHFA's ADU Grant - 2023
The ADU Grant could be back from the dead (but there’s a catch)
The funding has been approved to help homeowners build ADUs - 50 MILLION dollars worth
State legislators and the governor just came to a budget deal that includes $50 million in ADU incentives through CalHFA.
Well… technically the “state budget agreement leaves unchanged the $50 million allocation” — ah the beautiful poetry of Sacramento.
“The 2023-24 State Budget agreement leaves unchanged the $50 million allocation to CalHFA for Accessory Dwelling Units in the 2022 Budget Act. Over the coming months CalHFA, in conjunction with our partners in state government, will be evaluating the various options available to increase ADU production in California with this funding.”
—CalHFA update
What’s Next? Let’s get that $50 million
Together we are going to make sure as much of that state money gets into the pockets of real homeowners like you and me… not big banks or trapped in reels of red tape
Help us advocate for how this money gets spent - Bring back the grant for homeowners
Thanks to the support of readers like you, I got to spend a lot of time in Sacramento this year to advocate for you.
And that means I get invited to working groups and committees where I can give feedback directly to CalHFA and other stakeholders.
And then I get to come back and bring you important updates. That’s why were able to publish about this ADU incentive funding
Why is this so complicated?
You’re probably wondering why this is so complicated. Shouldn’t there just be a government website that explains how it all works?
Here’s the short version:
The state government allocates $50 million to ADU incentives and tells CalHFA that it’s up to them to use the money well - it also requires they convene a working group to think about how to spend the money
CalHFA has to make a lot of decisions and there are lots of self-interested stakeholders who want to influence the process so that they get more benefit from that $50 million
YOU have an opportunity to influence this process
If you do nothing, there is a chance the $50 million goes to somebody other than homeowners!!!
Why wouldn’t they just fund the grant again?
I think you’ll find that some people would rather that money didn’t go directly to homeowners.
For example, in the past, CalHFA has asked its working group to consider investing the $50 million in the following list of programs:
Continuation of the CalHFA ADU grant program (potentially with modifications)
Loan loss reserve or other credit enhancements to encourage lending
Different loan products such as renovation loans, bridge loans, and second mortgages
Other approaches to mitigating lender risk, including loan guarantees, mortgage insurance, managed escrow and rental income guidelines
Opportunities to increase outreach and education to inform homeowners about the various loan and grant products available to them
Financing options for construction costs and factory-built accessory dwelling units, including through partnerships with local agencies and qualified nonprofits
Matching fund opportunities
Opportunities to ease constraints that limit the loan process for homeowners, including issues that are not controlled by the agency, including federal lending standards and local practices
So tell me… do you want the $50 million to go toward MITIGATING LENDER RISK? Guaranteeing loans so that our banks don’t suffer while you build your ADU?
You understand why it’s important for us to speak up vocally for the grant if that’s what we want.
And here’s where it all comes together…
If you want to know if/when the grant comes back and application portals start reopening…
It’s easy.
Help us advocate for the grant by registering for this free mailing list.
Anybody who joins this advocacy group will get an email as soon as I get updates.
Otherwise, sit tight and you’ll find out when the rest of the world does.
Most recently, CalHFA sent out an email promising that it would send out updates as it evaluates the various options available “over the coming months”…
