Gov Newsom announces $101M funding to build Palisades low-income housing

(The Center Square) — Six months after the devastating Palisades and Eaton fires, California Gov. Gavin Newsom unveiled $101 million in funding Tuesday for “multifamily low-income housing development” that will “contribute to a more equitable and resilient Los Angeles." The priority is for “geographic proximity to the fire perimeters of the Eaton, Hughes, and Palisades fires.”

Earlier this year, The Center Square broke news that California state law and a local Los Angeles ordinance require fire-destroyed rent-protected housing — which includes all apartments in the city built before October 1978 — be replaced with low-income housing. Because the affordability requirements use county-level income data, not more local incomes, definitions for “low” and “very low” income housing reflect much lower incomes than the norm for the affluent Palisades community.

“Thousands of families – from Pacific Palisades to Altadena to Malibu – are still displaced, and we owe it to them to help,” said Newsom in a statement. “The funding we’re announcing today will accelerate the development of affordable multifamily rental housing so that those rebuilding their lives after this tragedy have access to a safe, affordable place to come home to.”

The California Department of Housing and Community Development’s Notice of Funding Availability for the $101 pool details how funding will be awarded.

“The 2025 wildfires in Los Angeles County have intensified the region's longstanding housing crisis, underscoring the urgent need for multifamily low-income housing development,” wrote Jennifer Seeger, the HCD deputy director of the Division of State Financial Assistance. “The Multifamily Finance Super NOFA – Los Angeles Disaster (MFSN-LA Disaster) makes funds more accessible to support the development of safe, fire-resilient multifamily low-income housing that will provide long-term stability, protect vulnerable populations, and contribute to a more equitable and resilient Los Angeles.”

The grant includes multiple funding streams, including the Multifamily Housing Program for low-income housing, taxpayer-funded supportive housing for those exiting institutional settings or homelessness, transit-oriented development that boosts density near transit stops for income-restricted housing, and veteran and homeless veteran housing.

It’s possible to stack funding, meaning a program could make use of multiple programs within the grant to increase the project's portion of grant-funded low-income housing units.

The notice includes scoring preference for projects that are closer to the fire burn radius, have local government funding commitments, have an occupancy preference for wildfire victims, and are ready to start construction within 180 days of awarded funds.

To qualify as Supportive Housing Multifamily Housing, a project must provide at least 40% of its units for the homeless, or individuals who have spent at least 15 days in “jails, hospitals, prisons, and institutes of mental disease.”

Projects gain additional points for being a Transit-Oriented Development built within a quarter mile of a transit station, which includes qualifying bus stops. This program allows for a 50% to 80% density bonus based on the level of transit service, so long as at least 15% of units are set aside for very low- or low-income households.