Best Practices

The Driving Clean Assistance Program (DCAP) helps people purchase or lease a new or used battery electric, plug-in hybrid electric, or fuel cell vehicle. The program aims to build reliable transportation options for consumers and improve their financial security while reducing emissions, protecting consumers from predatory lenders, and empowering individuals to maintain their purchase through financial coaching.

Recognizing transportation as a significant barrier to upward mobility, the program began as a pilot in 2015 to help lower-income families. CHDC secured funding from California Air Resources Board to provide up to $5,000 in grants to those wishing to purchase an alternative fuel source vehicle. The remainder of the purchase was covered by a loan with a modest interest rate (as compared to the prevailing rates). This rate is offered regardless of the individual’s credit history and score, which helps to increase accessibility and combat predatory lending practices. The program also provided $2,000 for in-home charging installation or public charging. The pilot was well received, and the program shifted to statewide, serving every low-come and disadvantaged community in the state. The program is open to applicants who have no vehicle to scrap and those who do.

Eligible applicants with a gasoline vehicle can scrap it and receive a grant of $9,500 to purchase an electric vehicle or $12,000 if they live in a disadvantaged community. If the participant does not have a car to scrap, they receive a $7,500 grant. The grant buys down the cost of the vehicle which decreases the loan amount needed, making it more feasible for the individual to get a loan and decreasing risk for the lender. The consumer participates in financial education and counseling, which focuses on enhancing credit and better budgeting, so participants are prepared for ongoing insurance, car payments, maintenance costs and gas.

The loan amount is not based on the consumer’s credit history but rather on affordability and ability to repay. It is available to households at or below 300% of the federal poverty level and the individual must be at least 18 years old and a California resident.

The long-term impacts of the program are positive! While the goal is to help those residing in disadvantaged communities to obtain safe loans to purchase an alternative fuel source vehicle, the financial education and coaching translate to other areas of life as well.

Community Housing Development Corporation (CHDC) is an affordable housing organization that works to help residents find secure housing and financial stability. DCAP is a key program in helping families achieve financial stability.

Tips for Success:

• Create a grant opportunity to buy down the total price
• Include a lower interest rate for the remainder of the loan
• Partner with many lenders
• Plan to work on credit blemishes
• Help participants build a working budget
• Explain the program to car dealers to get buy in
• Be ready for technical questions about electric vehicles