The push to expand rent control in California resumed in the Legislature, just months after state voters overwhelmingly rejected an initiative that would have removed barriers to new tenant protection laws.
A group of Democratic legislators introduced bills to cap annual rent increases statewide, prevent evictions without just cause and return to cities the authority to adopt rent control ordinances for newer homes and apartments.
Supporters said urgent action is needed to address what has become a statewide emergency, as families face soaring housing prices and the prospect of homelessness. About half of California renter households spend more than 30 percent of their income on shelter, which experts consider to be a cost burden, according to U.S. census estimates. More than a quarter spend at least half their income on housing.
“The rent is too damn high. It’s time for us to act,” Assemblyman David Chiu, D-San Francisco, said at a Capitol news conference.
The state strictly limited rent control practices in 1995 with the passage of the Costa-Hawkins Rental Housing Act, which prohibited local governments from imposing price caps on apartments built after the law took effect or on single-family homes and condominiums. It also banned cities from limiting prices when a unit becomes vacant.
REALTOR® Campaign Favored Construction
Following a $100 million campaign that the California Association of REALTORS® backed, nearly 60 percent of California voters opposed a November ballot measure to undo Costa-Hawkins and give communities more flexibility on rent control. Proponents said local governments should be free to set their own rent laws and that tenants needed protection from out-of-control prices. Opponents argued that the measure would discourage construction of rental housing at a time when supply is tight in many cities.
Despite the initiative’s defeat, Gov. Gavin Newsom told lawmakers in his State of the State address earlier this year, “Get me a good package on rent stability this year and I will sign it.”
The measures that Democrats unveiled would roll back pieces of Costa-Hawkins while leaving the broader law in place. Many of the details must still be worked out through the legislative process.
AB36, by Assemblyman Richard Bloom, D-Santa Monica, would allow cities to enact rent control on post-1995 buildings that are more than a decade old. It also would clear the way for cities to limit rent increases on single-family homes and condominiums more than 10 years old. It includes an exemption for landlords who own just one or two units and does not touch the ban on price caps for vacant units.
Bloom said the changes could provide immediate relief for renters during the many years it will take for more housing to be built in California. He added that he is in negotiations with the California Apartment Association and other landlord groups to avoid a repeat of last year’s campaign slugfest. The AIDS Healthcare Foundation in Los Angeles, which supplied most of the money in favor of the unsuccessful rent control initiative, has floated the possibility of trying again in 2020.
“There is an understanding on both sides of this issue that the crisis has not, is not and will not go away until we act in various ways,” Bloom said.
Worsening Housing Shortfall
Tom Bannon, chief executive officer of the California Apartment Association, said in a statement that the proposals announced “would only worsen our housing shortfall.”
“We need to encourage new housing, not create policies that stifle its creation,” he said. “It’s time that lawmakers heed the will of voters and focus on policies that would create the homes that California’s working families need.”
Chiu’s AB1482 would prevent landlords across the state from raising rents by more than an unspecified percentage above inflation each year. Chiu said he is figuring out a cap that would help a broad swath of renters while still allowing landlords to earn a return on their investments.
AB1481, by Assemblyman Rob Bonta, D-Alameda, would forbid landlords from evicting their tenants without a valid reason.
These measures are similar to a law passed last month in Oregon, which became the first state to enact universal rent control. It largely limits annual rent increases to 7 percentage points above inflation and bans no-cause evictions for tenants who have lived at a property for more than a year.
Bill Would Require Rent Reports
Another bill, by Assemblywoman Buffy Wicks, D-Oakland, would require all landlords to register their rental units with state housing officials and annually report the amount of rent they charge, the number of evictions and the length of vacancies. Wicks said AB724would help the state in drawing up rental policies.
Elsa Stevens, 65, a former caregiver from Richmond, came to the Capitol to show her support for the legislation. She and her husband live in affordable senior housing and spend 40 percent of their monthly Social Security and disability benefits on rent.
When her landlord notified them last year that rents would go up 12 percent, Stevens said, tenants persuaded the management company to lower it to 3 percent. But with medication and other health care costs eating up a large chunk of her budget, she said, another big increase would price her out of her apartment.