Pacific Gas and Electric Co. of San Francisco is launching a $50 million, five-year program to provide financial investment in affordable housing in northern and central California.

The program, funded by its parent company, PG&E Corp. (NYSE:PCG), targets investments in projects ranging from construction of apartment complexes to rehabilitation of residential hotels. The average per-project investment is expected to range from $2 million to $5 million.

``PG&E is involved in investing in affordable housing because it is key to creating vibrant local economies,'' said Gordon Smith, president and CEO of Pacific Gas and Electric Co. ``Basic housing is an essential need of everyone. Unfortunately, for many low-income families, individuals, and seniors, affordable housing just doesn't exist.''

The dearth of affordable housing is a national problem, as the National Association of Home Builders points out.

Their data show that incomes have not kept up with rising housing prices. In 1976, almost half of all families could afford to buy a median-priced home; in 1996, just more than one-third of families have enough income to make purchases, according to NAHB.

Congress recently passed two bills, both pending for the President's signature, designed to address the problem. One, supported by the National Association of Realtors® and the Mortgage Bankers Association of America, would raise FHA loan limits to open up more avenues to potential buyers. The other would allow people who live in public housing to use their monthly ``Section 8'' assistance vouchers toward payments on a home.

Lack of affordable housing is also a California problem. The California Association of Realtors' annual financing survey shows that the median price of a home in California rose 7.9 percent over the 1997 median price of $190,000 to $205,000 in 1998.

Pacific Gas and Electric Company has been investing in affordable housing projects since 1990 when it became a limited partner in the conversion of Oakland's California Hotel into housing for residents with special needs. Through 1997, PG&E committed more than $22 million to nine affordable housing developments from Chico to Bakersfield. Investments are recovered through reduced federal and state income taxes. PG&E is a major sponsor of the Non-Profit Housing Association of Northern California's annual conference to be held on October 14 in San Francisco. The Non-Profit Housing Association works to preserve, develop, and manage quality housing, as well as revitalize and enhance communities and neighborhoods through the support and promotion of non-profit housing development corporations. ``We support their mission and are pleased to be part of their annual conference to help raise awareness about this important issue,'' Smith said. ``The support and commitment of PG&E in the development of affordable housing is a tremendous boost for those who need it most,'' said Dianne Spaulding, executive director of the Non-Profit Housing Association of Northern California. ``PG&E's ability to work flexibly and creatively with developers and community stakeholders make it a most welcome partner in our efforts to build community.''

Published: October 16, 1998

Use of this article without permission is a violation of federal copyright laws.