The California Apartment Association has secured a major change to a controversial housing proposal, prompting the removal of rent control incentives. 

SB 262 by Sen. Aisha Wahab, D-Fremont, originally proposed offering state funding to cities and counties that adopted rent control policies. It sought to expand the state’s “pro housing” designation to include local governments that imposed residential rent stabilization ordinances and funded legal services for eviction defense. 

The association opposed the bill, warning that it would incentivize local governments to adopt regulatory policies that restrict rental housing operations without encouraging new housing construction. In a coalition floor alert, housing and business groups stated, “Rent control is objectively not a pro-housing policy. It does not facilitate housing development — it strangles it.” 

The opposition also cited analysis from the Legislative Analyst’s Office, which has repeatedly concluded that rent control can reduce housing construction, shrink the rental housing supply, lower property tax revenues, and increase costs to local governments. 

Following strong opposition from CAA, Senator Wahab agreed to remove the bill’s references to rent control. As amended, SB 262 no longer includes provisions relating to rent control or funding for legal services tied to eviction defense and prevention.