The Los Angeles City Council Tuesday authorized the release of a notice of funding availability for nearly $467 million to support the construction and preservation of rental units across the city.

In a 13-0 vote, the council approved the notice of funding availability, also referred as an NOFA. It’s expected to be released Oct. 13, allowing developers, nonprofits and other organizations to apply for grants and loans for housing projects.

Council members Heather Hutt and Tim McOsker were absent during Tuesday’s vote.

Interested parties will have until December to submit applications, followed by a scoring and selection period from November to February 2027. The City Council is expected to review and approve awards by April 2027, according to an anticipated timeline produced by the city’s Housing Department.

Councilwoman Imelda Padilla, chair of the Housing Committee, noted that the measure was approved with some safeguards, requiring the housing department to provide quarterly reports on how the money is used and tracking the progress of projects that receive funds. The information is already tracked by the department, but the councilwoman wanted to be kept up to date in a more timely manner.

“This is a significant investment that will help us build new affordable housing and preserve the affordable housing we already have,” Padilla said. “We need to follow these dollars and make sure they are producing the affordable housing Angelenos deserve, and that includes talking to all the departments involved.”

Padilla said the council also directed the housing department to make the programs easier to understand and navigate by using education models on its website.

The funding will be the largest ever released for the construction and preservation of rental units and other housing projects. It’s part of the Homes for LA initiative, which aligns multiple city funding sources with housing needs under one NOFA. Administered by the housing department, each funding source has different requirements, eligible uses and ineligible uses.

Some of the programs support affordable housing projects that have affordability covenants or legal restrictions on rents that are expiring, or address deferred maintenance and repairs of entire building systems, as well as very low rents that have not kept up due to escalating costs such as insurance premiums, building security and staffing.

Other programs assist with funding new construction, allowing developers to pursue a financing strategy that can serve as an alternative to tax credits.

The nearly $467 million will be the second round of the Homes for LA initiative, largely funded by Measure United to House Los Angeles, also referred to as LA’s “mansion tax.”

Approved by voters in 2022, Measure ULA established a transfer tax of 4% on property valued above the annually adjusted figure of $5.4 million, and a 5.5% tax on properties valued above $10.9 million. The tax encompasses the transfer/sales of mansions, apartments, commercial buildings and multi-family housing, among other categories of buildings.

The measure took effect April 1, 2023, and as of April 30, 2026, it had raised nearly $1.2 billion from 1,633 real estate transactions, according to the city Housing Department.

Revenue raised by the tax supports various homelessness prevention programs, such as rental assistance, eviction defense, outreach and tenant rights education, and funds affordable housing construction in Los Angeles.

Councilwoman Ysabel Jurado expressed her excitement for the upcoming NOFA, adding that Homes for LA will have one of its biggest impacts in her 14th District, encompassing downtown and northeast communities.

“Nearly 70% of CD14 residents are renters, and the housing crisis meant that many of them are paying half of their income or more just to stay housed. Homes for LA shows what it looks like when we invest in people with intention, not just in theory, but with real dollars, real projects and real homes,” Jurado said.

The first round of Homes for LA, with grants awarded in April, provided nearly $361 million to support 5,241 affordable units across 80 projects. Of that figure, the initiative resulted in the construction of 1,528 new affordable units and the preservation of 3,713 affordable units. The housing department is expected to begin executing loan agreements for 4,129 units across 71 projects in October.

Before the Homes for LA NOFA, the housing department made between $50 million and $75 million available through its annual funding rounds, according to the United to House LA Coalition.

Joe Donlin, executive director of the ULA coalition, said the latest NOFA is a testament that ULA is working and widely successful.

“In three years, ULA has funded 1,900 units of brand new affordable homes and funded preservation of thousands more. Now, the largest NOFA in Los Angeles’ history will fund even more affordable housing with mostly Measure ULA funds,” Donlin said in a statement. “For the first time ever, Los Angeles has a significant source of funding for affordable housing with a level of funds that are unmatched by any other city in the United States.”

Critics of Measure ULA have argued the tax has slowed commercial development and property sales and hurt the availability of affordable housing.

A 78-page report, titled “The Effects of Measure ULA Transfer Tax on Economic Development and Municipal Finances in Los Angeles,” published by RAND found that ULA has reduced apartment construction, increased rent and cost jobs and funding for city services.

“Study after study confirms what affordable housing builders, construction workers and tenants are seeing first-hand — Measure ULA is slowing housing production, which increases costs for renters and those who want to own homes,” said in a statement Sarah Dusseault, a member of the Affordable LA: Mend It, Don’t End It coalition, who are advocating for ULA reforms.

“It’s time to follow the data and the peer-reviewed research and make practical fixes to Measure ULA so it better achieves its goals, which we all agree on — more housing, increased affordability and less homelessness,” Dusseault added.

Earlier this year, the Howard Jarvis Taxpayers Association pulled what they called the “Local Taxpayer Protection Act to Save Proposition 13” from the November ballot after reaching a deal with state lawmakers. The group’s proposal intended to repeal Measure ULA and other real estate transfer taxes higher than 0.11%.

The association has argued that Measure ULA violates both the state Constitution and the L.A. City Charter.