OAKLAND — California Gov. Gavin Newsom has signed Assembly Bill 179, a housing budget trailer bill designed to streamline affordable housing financing, reduce construction costs, and accelerate housing development across the state.
The legislation, part of California’s 2026–27 state budget, modernizes the state’s affordable housing finance system through a “One-Stop Shop” approach intended to reduce duplicative reviews and shorten project timelines.
State officials estimate that financing and impact fee reforms could reduce the cost of building affordable housing by approximately $60,000 to $70,000 per unit.
“Every Californian deserves a place to call home,” Newsom said, adding that the reforms are intended to cut red tape, expand financing opportunities, and help communities build housing faster.
The legislation also creates a $100 million Disaster Rebuilding Fund to reduce financing costs for homeowners repairing or rebuilding homes following disasters.
California will provide $900 million in fiscal year 2026–27 to continue the Housing, Homelessness Assistance and Prevention program, known as HHAP. The funding includes new local matching and housing policy requirements for certain large cities and counties.
The state is also allocating $500 million for enhanced low-income housing tax credits and $200 million for the Multifamily Housing Program to support the construction and preservation of affordable housing for low-income Californians.
According to the governor’s office, residential construction in California has increased 59% since 2019, while the state has recorded its largest reduction in unsheltered homelessness in 16 years.
The reforms come alongside the proposed $11.25 billion Veterans and Affordable Housing Bond Act of 2026, which is expected to go before California voters later this year.