California lawmakers are making efforts to tackle the housing shortage crisis. SB 750, proposed by state senator Dave Cortese (representing District 15), would offer public credits to back both loans and construction in hopes of spurring development. This would also speed up the process for developers and offer them more suitable interest terms.
The bill would support multifamily projects in California. Should the legislation become law, a program would be established through the California Housing Finance Agency, which would be responsible for administering the credits and generating revenue from premiums of insurance loans.
According to details in SB 750, California's fifth housing element cycle, which ended in March 2025, required that 277,523 homes be built for low-income residents. Yet, only 57,392 were permitted.
"Under the proposed bill, California for the first time could draw in credit strapped investors to potentially unlock hundreds of thousands of shovel-ready homes now stuck in limbo by using the full faith and credit of the state to back the financing for the housing projects," Cortese wrote in a Facebook post.
He added that the legislation would not only boost the housing supply but could also lower the cost of rental units.
That's key because Nolan Gray, senior director of legislation and research for California YIMBY, said that around 25 percent of Californians spend half their income on rents, which emphasizes the importance of building as much as possible to relieve the cost burden, according to the East Bay Times. The newspaper also said that SB 750 has backing from other state senators, including Christopher Cabaldon, Scott Wiener, Jesse Arreguín and Josh Becker.
Meanwhile, Cortese said that the electorate will need to pass a ballot innovative to amend the state's constitution in addition to passing a companion bill to bring real change. Currently, the law in place forbids the state legislature from passing anything with liabilities or debts that are greater than $300,000, according to East Bay. SB 750 only lays out the framework for a financing tool. So work still needs to be done.
As a likely long process remains for the latest initiative in California, another major city in the state has found success by incentivizing developers. San Jose has done this through its multifamily housing incentive program, initially aimed at waiving 50 percent of construction taxes and fully exempting in-lieu fees for 1,500 units in eligible growth areas. But since interest from developers has surged, the city has been forced to expand the eligible units to 1,800.
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to asset-and-logo-licensing@alm.com. For more information visit Asset & Logo Licensing.
