California faces significant challenges related to housing affordability and climate vulnerability, especially in rural and disadvantaged communities. The Affordable Housing and Sustainable Communities (AHSC) grant program, administered by the California Strategic Growth Council, seeks to address these issues by funding affordable housing projects near public transit to reduce greenhouse gas emissions. This research critically examines the AHSC program’s scoring and selection methodologies, highlighting structural biases that disadvantage rural applicants due to lower scores on greenhouse gas reduction metrics. Utilizing quantitative analysis of historical application data from four recent funding cycles and qualitative insights from semi-structured interviews with program administrators and stakeholders, the study identifies key areas of imbalance, such as geographic allocation practices leading to suboptimal environmental outcomes and scoring methodologies inadequately capturing the long-term benefits of affordable housing. The analysis demonstrates no significant differences in greenhouse gas reduction between projects from disadvantaged versus non-disadvantaged communities, underscoring effective integration of equity objectives. To enhance equity and effectiveness, the research recommends adopting a revised greenhouse gas efficiency metric, refining geographic goal implementation, and extending evaluation periods. These strategic adjustments can improve fairness, transparency, and overall effectiveness of the AHSC program, enabling better alignment between housing affordability, geographic equity, and environmental goals. The Strategic Growth Council can utilize these findings and recommendations to ensure equitable distribution of funding and to optimize the environmental and social impact of public investments in sustainable housing and transportation solutions.