California is home to some of the most diverse and vibrant communities in the nation, but beneath that diversity lies a persistent and growing inequality in housing access.
At Two Hundred for Homeownership we fight every day to break down the systemic barriers that keep too many Californians from safe, stable, and affordable housing. We know firsthand that housing is more than a roof over your head. It’s the foundation of health, education, opportunity, and dignity.
Yet across the state, deep racial and economic disparities persist. More than half of Black and Latino renter households spend over 30% of their income on rent, qualifying them as “rent-burdened.” Black homeownership is just 36.6%, nearly 28 points below white households, while Latino homeownership stands at 45.9%—18.5 points lower than white households.
For decades, low-income families and communities of color have fought to hold onto their homes and neighborhoods. Now, a little-known provision buried in the state budget threatens to make that fight even harder.
Tucked deep into the 137 pages of the housing bill passed by the Legislature in June is language that will allow local governments and regional agencies to impose “vehicle-miles traveled” fees on new housing construction. Marketed as environmental mitigation tools, VMT fees are in reality hidden housing taxes that will land squarely on renters, first-time buyers, and working families.
The numbers are alarming. A Caltrans-funded study found these new taxes could reach $16,200 per unit annually for 20 years — a staggering $324,000 for a single home or apartment. That’s the equivalent of slapping a $2 tax on every mile driven over a government-set limit. For renters, that’s an extra $1,350 every month — a 48% increase over California’s median rent. For homebuyers, it’s on top of nearly $200,000 in state and local mandates already baked into the price of a new home.
Even more troubling, these costs don’t have to stay in the neighborhoods paying them. Revenue from VMT taxes can be funneled into a statewide fund with no guarantee of local benefit, meaning working-class communities could be forced to subsidize projects miles away while their own housing needs go unmet.
The harm won’t be felt equally. Black and Latino households who are already more likely to rent, face displacement, or live in redevelopment-targeted areas which will be hit hardest. Families in rural and suburban areas will also pay the price. In many of these communities, affordable housing is increasingly located farther from job centers, forcing residents to drive longer distances. Under these provisions, simply living farther from work becomes a penalty, and desperately needed housing projects in these regions could be delayed or abandoned altogether.
Assembly Bill 130 gives local and regional agencies sole discretion to impose these taxes, with no cap on how high they can go. There is no public vote, no meaningful input from the families and communities who will bear the cost. This uncertainty will stall construction, drive up prices, and kill good-paying jobs in construction, engineering, and the trades, further harming the very communities our state claims to prioritize.
Housing is not just a commodity. It is the foundation of stability, health, education, and opportunity. Every barrier we put between families and a safe, affordable place to live is a step backward. Every time we add cost, delay, or uncertainty to housing construction, we widen the gap between those who can afford to stay in their communities and those who can’t.
We must pursue environmental and infrastructure goals without sacrificing equity or affordability. That starts with fixing the housing legislation by removing these provisions and ultimately working together for solutions that protect our climate, create jobs, and keep housing within reach for all Californians — urban, suburban, and rural alike.
We ask legislators to fix the law as this hidden tax doesn’t move us forward. It pushes working families further behind.
Robert Apodaca is founder and executive director of Two Hundred for Homeownership, an Oakland-based nonprofit organization that seeks to mitigate the increase in poverty and the growing wealth gap in California through homeownership and home building.
