Committee backs constitutional amendment proposal to dedicate roughly $400 million a year for housing

Senator Muhammad told members SF 26-21 would create a constitutional amendment dedicating new revenue for housing and described the measure as a long-term, structural response to the state's housing shortage. "A sales tax ... estimated to generate $400 million dollars annually for 25 years," the sponsor said on the record, framing the amendment as predictable funding to address rental preservation, household stability and homeownership.

Witnesses from housing organizations described proposed distributions and goals: coalition testimony listed funds for household and community stability, rental opportunity and homeownership programs and emphasized long-term predictability to preserve units and finance starter homes. Habitat for Humanity and other advocates said steady funding would let developers and service providers plan multi-year projects instead of relying on year-to-year appropriations.

Committee members debated policy merits, distributional details and political feasibility; opponents said the amendment would not necessarily remove barriers to homeownership and criticized parts of the draft (including prevailing-wage language they said could raise costs). After extended discussion the committee voted to recommend SF 26-21 to the Tax Committee; the roll call in the transcript showed five yes and three no votes on the committee recommendation.