Will the New Affordable Bill Overlap with Opportunity Zone Projects?

SB-196 is one of many new housing bills that Governor Newsom has signed into law to encourage affordable and low-income housing development. The bill provides a property tax exemption for community land trusts building affordable housing—a huge benefit—but that could be just the beginning. In some cases, these projects could also line-up with opportunity zone benefits, particularly because there is such a widespread need for affordable units.

“In some cases, there may be some overlap between affordable housing development and Opportunity Zone deals; however, there is a need for affordable housing in virtually every market, whether or not it is deemed an Opportunity Zone,” Richard Lara, president and CEO of RAAM Construction, tells GlobeSt.com.

While there is definitely potential to line-up benefits, Lara says that in some cases more expensive markets—and therefore not an opportunity zone—are the most in need of affordable housing. “One might argue that it is in the most affluent areas where affordable housing is most needed because lower-income residents can’t afford to buy or rent in those markets,” says Lara. “There isn’t an obvious need for budget-friendly housing in those areas because we may not see crime or blight there, but a large percentage of the workforce—including teachers, first responders, nurses—are priced out of these markets and must resort to long commutes in order to get to their jobs in the higher-priced areas.”