The California housing-finance ecosystem
California's housing pipeline draws on a mix of state agencies, federal pass-through programs, and local frameworks. Programs span the full spectrum: low-income rental, supportive housing for special-needs populations, workforce / missing-middle housing, homelessness prevention, first-time homebuyer assistance, mixed-use redevelopment, and disaster recovery. Below is a directory of every currently-active state-level and major-local program, organized by administering agency.
Tax Credit Allocation Committee (TCAC) & California Debt Limit Allocation Committee (CDLAC)
Two committees within the State Treasurer's Office that administer the largest pieces of California's capital stack. TCAC allocates federal 9% LIHTC, the $500M+ annual state LIHTC pool, and is responsible for compliance monitoring. CDLAC allocates the state's ~$5.27 billion in 2026 tax-exempt private-activity bond volume cap among multifamily housing, single-family mortgage revenue bonds, and other eligible uses. Both make awards 2-3 times annually.
Federal 9% LIHTC
Competitive · Rental · TCACTCAC allocates California's federal 9% LIHTC ceiling — approximately $133.2 million in 2026 following OBBBA's permanent 12% increase. Awards are made through 2-3 competitive rounds annually under the TCAC QAP. Set-asides include nonprofit, rural, special needs, supportive housing, at-risk preservation, and Native American.
4% LIHTC
Non-competitive · Rental · TCACNon-competitive 4% LIHTC automatically pairs with CDLAC private-activity bond awards. Post-OBBBA the 25% bond financed-by test (for bonds issued after Dec 31, 2025) substantially expands the universe of 4% deals California can support.
California State LIHTC
State tax credit · One of the largest state creditsCalifornia has one of the largest and most active state low-income housing tax credit programs in the country. The Legislature authorizes $500 million annually in state LIHTC (in addition to ~$130 million in statutorily required state tax credits). State credits can be paired with either 9% or 4% federal credits per AB 346, and are commonly used to deepen affordability or close gaps on the most challenging deals.
CDLAC Qualified Residential Rental Project
Private-activity bonds · MultifamilyCDLAC's largest single use of the state's annual PAB volume cap is the Qualified Residential Rental Project (QRRP) program — tax-exempt bonds for new construction, acquisition, or rehabilitation of multifamily rental housing. Awards automatically generate matching 4% LIHTC from TCAC.
Mortgage Credit Certificate (MCC)
Homeownership · Tax creditCDLAC allocates a portion of the state's bond authority to Mortgage Credit Certificate programs administered by local public housing authorities and CalHFA. MCC provides a federal income-tax credit equal to a percentage of mortgage interest paid annually, reducing effective ownership costs for eligible first-time buyers.
California Department of Housing & Community Development (HCD)
HCD is California's primary state housing department, administering federal HOME, NHTF, and CDBG funds plus a large portfolio of state-funded gap subsidy, supportive housing, farmworker housing, and homeownership programs. HCD's Multifamily Finance Super NOFA (MFSN) consolidates four of its rental programs into a single coordinated application process. Effective July 2026, several HCD functions reorganize under the new California Housing & Homelessness Agency (CHHA).
Multifamily Housing Program (MHP)
Gap loan · Long-term deferredHCD's flagship affordable multifamily gap loan program. Provides low-interest (~0.42%), long-term deferred-payment permanent loans for new construction, rehabilitation, and preservation of rental housing for lower-income households. The 2026 round provides approximately $240 million through MFSN, with 10% set aside for tribes and 10% targeted to rural areas.
Affordable Housing & Sustainable Communities (AHSC)
Greenhouse gas reduction · TODCap-and-trade-funded program supporting compact, infill, transit-oriented development that reduces greenhouse-gas emissions. Combines affordable housing capital with transit, active transportation, and other GHG-reducing infrastructure. Administered jointly with the Strategic Growth Council. Currently HCD-administered; will transition into CHHA/HDFC structure.
Veterans Housing & Homelessness Prevention (VHHP)
Veterans housing · Long-term loanLong-term loans for new construction and rehabilitation of rental housing serving very-low and low-income veterans and their families. Funded by Proposition 41 bond authority. Administered by HCD in coordination with the California Department of Veterans Affairs.
No Place Like Home (NPLH)
Supportive housing · Mental IllnessDedicated capital funding for permanent supportive housing serving persons with serious mental illness who are homeless, chronically homeless, or at risk of chronic homelessness. Funded by Proposition 2 bond authority backed by Mental Health Services Act (MHSA) revenue.
Joe Serna Jr. Farmworker Housing Grant
Farmworker housing · GrantGrants for development of housing serving agricultural workers and their families. Funds new construction, acquisition, and rehabilitation of multifamily, single-family, and migrant farmworker housing. One of the few dedicated state farmworker housing programs in the country.
Infill Infrastructure Grant (IIG)
Infrastructure · Infill developmentGrants for infrastructure improvements (water, sewer, streets, parks) supporting affordable, infill housing developments. Targets reduction of greenhouse-gas emissions through compact, accessible development patterns.
Transit-Oriented Development (TOD) Housing Program
TOD · InfrastructureLoans and grants for housing developments and infrastructure near transit. Supports compact, mixed-use development that increases transit ridership and reduces auto-dependence.
Portfolio Reinvestment Program (PRP)
Preservation · Existing affordableGap funding to preserve and rehabilitate existing affordable rental properties at risk of conversion to market rate. Targets the backlog of properties with expiring use restrictions and significant deferred capital needs.
CalHome
Homeownership · Down payment & rehabLoans and grants to local entities and nonprofits supporting affordable homeownership programs, including down payment assistance, mortgage assistance, owner-occupied rehabilitation, and acquisition/rehabilitation/resale of single-family homes for low-income buyers.
CDBG (state-administered)
Federal pass-through · Non-entitlementHCD administers the federal CDBG program for non-entitlement areas of California (smaller cities and rural counties not receiving direct HUD allocations). Funds housing rehabilitation, public facilities, infrastructure, and economic development.
HOME Investment Partnerships
Federal pass-through · Rental & homeownershipHCD administers the federal HOME Investment Partnerships Program for non-participating jurisdictions, providing flexible capital for rental housing development, homeownership, tenant-based rental assistance, and existing-housing rehabilitation.
National Housing Trust Fund (NHTF)
Federal pass-through · ELI householdsHCD allocates California's federal NHTF allocation (~$10.1M annually) for housing serving extremely-low-income households (≤30% AMI). Funds new construction, rehabilitation, and preservation with deep affordability targeting.
Homekey
Acquisition · Homelessness responseCapital grants to local governments, tribes, and nonprofits for rapid acquisition and rehabilitation of hotels, motels, and other properties to create interim or permanent housing for persons experiencing or at risk of homelessness. Successor program to Project Roomkey from the pandemic period.
ReCoverCA Disaster Recovery
Disaster recovery · CDBG-DRFederal CDBG-DR funds for housing and infrastructure recovery in counties affected by wildfire, flood, and other federally-declared disasters. Programs include homeowner rebuilding, multifamily rebuilding, and infrastructure repair.
Permanent Local Housing Allocation (PLHA)
Formula grant · Local jurisdictionsAnnual formula allocations from SB 2 Building Homes and Jobs Trust Fund revenue to cities and counties for local housing priorities including affordable rental and ownership housing, accessibility modifications, assistance for homelessness response, and adaptive reuse.
California Housing Finance Agency (CalHFA)
CalHFA finances the development and preservation of multifamily affordable housing and provides homeownership financing for first-time homebuyers. As a self-sustaining public benefit agency (no general fund support), CalHFA primarily raises capital through bond issuance and uses it to make first mortgages, gap loans, and homebuyer products. Will operate under the CHHA umbrella beginning July 2026 while retaining its separate corporate structure.
Mixed Income Program (MIP)
Gap subsidy · 30-120% AMICalHFA's flagship multifamily gap fund, providing subsidies for mixed-income properties that serve a range of incomes from 30% to 120% AMI. Pairs with 4% LIHTC + bonds. TCAC sets aside up to $200 million of discretionary state tax credits annually to pair with MIP awards; CDLAC sets aside private-activity bonds.
Multifamily First Mortgage
Conventional debt · MultifamilyCalHFA's multifamily first-mortgage products financing the new construction, acquisition, rehabilitation, and preservation of rental housing. Includes construction-to-permanent loans, permanent loans, and short-term acquisition loans. Used across deal types from supportive housing to mixed-income.
Multifamily Conduit Bonds
Tax-exempt bonds · 4% LIHTC pairingCalHFA serves as conduit issuer for tax-exempt private-activity bonds funding multifamily housing. Volume cap allocated through CDLAC. CalHFA conduit issuances are commonly used to finance acquisition-rehabilitation preservation deals throughout California.
Special-Needs Multifamily Housing Program (SHMHP)
Supportive housing · LoansLow-interest loans for developers of permanent affordable rental housing containing supportive housing units serving persons with disabilities, mental illness, chronic homelessness, and other special needs populations.
Section 811 Project Rental Assistance
Operating subsidy · Disability housingLong-term project-based rental assistance funding from HUD, administered through a collaborative partnership among CalHFA, the Department of Health Care Services, HCD, the Department of Developmental Services, and TCAC. Provides operating subsidy for units serving extremely-low-income persons with disabilities.
MyHome Assistance Program
Homeownership · Deferred-payment second mortgageDown payment and closing cost assistance for first-time homebuyers structured as a deferred-payment subordinate loan equal to a percentage of the purchase price. Combines with CalHFA first-mortgage products (FHA, USDA, VA, and conventional).
Forgivable Equity Builder
Homeownership · Forgivable second loanForgivable second-mortgage loan of up to 10% of purchase price for eligible first-time homebuyers. Forgiven after a fixed occupancy period if program requirements are met.
CalHFA Conventional, FHA, VA, USDA Loans
First mortgage · Below-market rateCalHFA's primary single-family first-mortgage products, originated through a network of approved lenders. Offers competitive below-market interest rates for income-eligible first-time homebuyers.
California Interagency Council on Homelessness (Cal ICH) & Strategic Growth Council
Cal ICH coordinates state homelessness policy and administers the Homeless Housing, Assistance and Prevention (HHAP) program — California's primary flexible funding source for local homelessness response. The Strategic Growth Council administers cap-and-trade-funded programs including AHSC. Both are being reorganized under the new CHHA umbrella effective July 2026.
Homeless Housing, Assistance & Prevention (HHAP)
Homelessness response · Flexible local fundingCal ICH's flagship program providing flexible funding to local governments and Continuums of Care for homelessness services, shelter, rapid rehousing, supportive services, and prevention. The FY 2026-27 budget appropriates $500 million for Round 7. Cumulative state appropriations to HHAP exceed $5 billion since program inception.
Encampment Resolution Funding (ERF)
Homelessness response · Encampment-specificCompetitive grants to local governments and tribes for resolving encampments through provision of housing and services to encampment residents. Targets specific encampments rather than general homelessness response. Administered by Cal ICH.
Transformative Climate Communities (TCC)
Place-based investment · Climate equityStrategic Growth Council program funding place-based climate equity investment in disadvantaged communities, including affordable housing as a component of broader neighborhood-scale projects. Cap-and-trade-funded.
How California programs typically combine
Programs combine differently depending on what you're building. A short reference of representative stacks across the program-type spectrum:
- Workforce / mixed-income development: CalHFA MIP + 4% LIHTC + CDLAC bonds + state LIHTC (via TCAC set-aside). Pairs with municipal welfare property tax exemption.
- Permanent supportive housing for chronically homeless: NPLH + Homekey acquisition + HHAP services + Section 811 PRA + 9% LIHTC (when capital-intensive). LIHTC optional for smaller-scale conversions.
- Transit-oriented affordable: AHSC + 4% LIHTC + bonds + MHP + local PLHA contributions.
- Veterans housing: VHHP + 9% LIHTC + state LIHTC + Section 811 PRA (where eligible).
- Farmworker housing: Joe Serna Farmworker Grant + USDA Section 514/516 + state LIHTC + local CDBG.
- First-time homebuyer: CalHFA conventional/FHA first mortgage + MyHome DPA + Forgivable Equity Builder.
Post-OBBBA implications
- Permanent 12% LIHTC increase: California's annual 9% LIHTC ceiling is permanently larger starting 2026.
- 25% PAB financed-by test: for bonds issued after December 31, 2025, materially expanding the pipeline of 4% LIHTC deals that can be supported per dollar of bond volume cap.
- Permanent OZ designations: Qualified Opportunity Zone designations gain permanence; Rural OZ provisions may apply in qualifying portions of the state.
- Section 45L / 179D termination (June 30, 2026): Developers pursuing energy-efficient construction should accelerate placed-in-service dates.
This is educational reference material for affordable-housing practitioners, not legal, tax, financial, or investment advice. State program details, funding levels, and rules change frequently — consult the relevant state agencies and qualified counsel before structuring any transaction. See Disclaimer.