CDLAC administers the tax-exempt private activity bond program to allocate the state ceiling among bond issuers for California. Private activity bonds (PABs) are issued by state or local government agencies or joint powers authorities to finance projects that provide a qualified public benefit, such as affordable housing, infrastructure, or economic development. Because the interest earned by bond investors is exempt from federal taxes, PABs carry lower interest rates than conventional loans. The repayment of PABs is not an obligation of the issuing agency, but the private entity receiving the bond proceeds. The 2026 State Ceiling for qualified private activity bonds is $5,323,220,505.
Agencies and organizations authorized to issue tax-exempt private activity bonds or mortgage credit certificates must receive an allocation from CDLAC.
Programs currently administered by CDLAC include the following:
Qualified Residential Rental Project Program (QRRP)
CDLAC allocates the vast majority (86-93% in recent years) of state ceiling to bond issuers that will issue PABs to fund affordable multifamily rental housing. Bond issuers that receive an award of state ceiling for a QRRP project can apply for non-competitive federal 4% low-income housing tax credits (LIHTCs), administered by the California Tax Credit Allocation Committee (CTCAC), which bring millions of dollars in equity investment to lower development costs and keep housing affordable.
CTCAC and CDLAC analysts work collaboratively to review QRRP applications to ensure all federal and state requirements are met and that each project will contribute to the housing goals set by the state. CDLAC’s competitive application process prioritizes new construction projects, funds pools and set-asides to further prioritize QRRP projects that meet state priorities and sets geographic apportionments.
Single-Family Housing Program
Bond issuers can issue both tax-exempt mortgage revenue bonds (MRBs) or mortgage credit certificates (MCCs) to assist first-time homebuyers when they purchase a home. Program participants must meet certain income limits and purchase a home that falls within the program's purchase price limitations. Currently, CDLAC is only providing state ceiling to the California Department of Veterans Affairs for the CalVet Home Loan program, which provides low-interest financing to eligible veterans.
Other Exempt Facility Bond Program
CDLAC provides a portion of state ceiling for other exempt facilities such as solid waste disposal and waste recycling facilities. The tax-exempt bonds provide facility owners with low cost financing in the form of below market interest rate loans. The interest rate savings enable the project owners to maintain lower customer rates or minimize customer rate increases, while at the same time assisting the communities they serve meet their mandated requirements to protect and enhance the environment.
Industrial Development Bond Program
CDLAC provides a small portion of state ceiling to assist manufacturing facilities finance capital expenditures. Today, most IDBs support expansions of existing manufacturing.