In the state legislative session that just ended, the California Apartment Association successfully lobbied for bills beneficial to the rental housing industry while stopping legislation that would have had a devastating effect on rental housing providers.
Here’s a look at some of the bill proposals that would have harmed the rental housing industry. Each of these bills failed passage.
Failed legislation that would have hurt rental housing providers
AB 2187 (Bryan) – Office of Tenants’ Rights – This bill would have established the Office of Tenants’ Rights and Protections. It was an expensive measure that would not have offered provisions for information or assistance to rental property owners.
AB 2216 (Haney) – Pets – As introduced, this bill would have required rental property owners to allow tenants to have common household pets at the rental property. Owners would not have been able to charge pet rent or a security deposit. Due to CAA’s objections, the bill was amended to require rental property owners with properties of 16 units or more to allow at least one pet per unit. The owner would have been allowed to charge pet rent for any pet beyond one and a security deposit equal to 50 percent of the first month’s rent, not to exceed $1,000. The owner could have mandated liability insurance and imposed rules and regulations on pet owners. The bill failed to move after these amendments were included.
AB 2230 (Bennett) – Unfair Practices – This bill would have enacted the Residential Housing Unfair Practices Act of 2023 and would have made it unlawful for anyone to engage in specified actions concerning the rental and sale of rental housing. The bill created a false narrative, blaming the housing industry for the housing crisis, claiming that the rental housing industry limits and reduces the production of housing, prevents development or redevelopment of housing, and creates and carries out restrictions on residential housing. CAA raised concerns about the bill, arguing that it was overly broad and would have resulted in frivolous lawsuits, development delays, and project eliminations. The bill never got a hearing.
AB 2304 (Lee) – Unlawful detainer masking bill – This bill, as introduced, would have extended the unlawful detainer “masking provisions” to cover cases where the tenant owed more than $35,000 in back rent and/or damages and would have blocked those cases from public view and credit reporting. (These high-value cases are not currently covered under state law.) Due to CAA’s opposition, the wording was removed from the bill.
AB 2384 (Wilson) – Public Pools Telephones – This bill would have required swimming pools at apartment buildings to have emergency telephones adjacent to the pool deck. It was sponsored by a company that sold these emergency phones.
AB 2785 (Wilson) – Interest on Security Deposits – This bill would have required a rental property owner to pay a tenant interest on their security deposit if the deposit was placed in an interest-bearing account; required rental property owners to accept a reusable screening report; required rental property owners to return a screening fee to any applicant not selected for tenancy; and capped screening fees at $50. The author agreed to drop the bill.
AB 2930 (Bauer-Kahan) – Automated Decision-Making Tools – This bill, as introduced, would have required rental property owners, their agents, and management companies, as well as developers of an “automated decision tool” (which would include a credit report or rent-setting tool), to perform an “impact assessment” for any automated decision tool used and to demonstrate that it did not illegally discriminate against prospective tenants. Tenants could have objected to the use of a credit report as part of a rental decision, which raised concerns for housing providers.
SB 1154 (Hurtado) – Price Algorithms – This bill would have prohibited rental pricing “algorithms” and would have permitted the Attorney General to investigate and enforce violations. The bill would have required all persons or entities with $5 million or more in revenue to disclose every time a price or term is set using a pricing algorithm. A “pricing algorithm” was defined in the bill as a computational process, including a computational process derived from machine learning or other artificial intelligence techniques, that processes data to recommend or set a price.
Rental housing bills on the governor’s desk
CAA successfully forced major amendments to several rental housing bills that will change or clarify rental housing practices if signed by the goveror. Here are those bills that successfully moved to the governor:
AB 2347 (Kalra) – Evictions – This bill changes the eviction timeline. Under current law, tenants have five days to respond to an eviction notice (known as an unlawful detainer). AB 2347 gives tenants five extra days to respond. At the same time, the bill will also shorten the timeline that applies to a type of motion a tenant attorney often files to delay the eviction, called a demurrer, which is a specific category of motion to dismiss the case. AB 2347 will change the timeline for these motions, subjecting them to the same expedited timeline that other motions in unlawful detainer cases follow, which will help reduce delays in the eviction process.
AB 2493 (Pellerin) – Screening Fees – As introduced, AB 2493 would have prohibited a rental property owner or their agent from charging more than one application screening fee within 30 days if the tenant-applicant applies to other units or residential properties owned by the same landlord or is managed by the same agent. CAA objected to this requirement, and AB 2493 was later amended to provide that a landlord or their agent may charge an applicant an application screening fee if the landlord or their agent, at the time the application screening fee is collected, accepts applications in the order in which the completed applications are received and that the first applicant to meet the landlord’s established screening criteria shall be approved for tenancy. This is a practice that CAA has long recommended as a way to avoid claims of discrimination. The bill would also require that the landlord’s screening criteria must be provided to the tenant-applicant in writing together with the application at the time the application is requested by the tenant-applicant.
AB 2801 (Friedman) – Security Deposits – AB 2801, as initially introduced, would have made changes to the security deposit law, including prohibiting rental property owners from using the security deposit to clean the carpets or for other professional cleaning and prohibiting owners from charging for any repairs that they don’t identify during the initial walk-through. As a result of CAA’s opposition, AB 2801 was dramatically amended, dropping those prohibitions. The bill now on the Governor’s desk will require landlords to take photographs of the unit immediately before move-in, at the end of the tenancy, as well as before and after any necessary repairs and cleaning are completed. These photographs must be provided to the outgoing tenant along with the security deposit disposition form. Other clarifying language in the bill provides that the landlord cannot deduct professional carpet cleaning or other professional cleaning costs from the deposit unless it is reasonably necessary to return the premises to the condition that existed when the tenant initially took possession of the unit.
SB 611 (Menjivar) – Fees & Military Security Deposits – This bill started as a very complicated advertising bill. CAA objected to the language, and SB 611 moved to the Governor’s desk with no language relating to advertising. SB 611 now provides that landlords or their agents are prohibited from charging a tenant any fee if the tenant pays the rent or the security deposit by check. It also provides that if a landlord or agent charges a military service member a “higher than standard” security deposit (the law already limits security deposits to one month’s rent), the rental agreement must include a statement of, among other things, the amount of the higher deposit and an explanation for why the higher security deposit amount is required. The bill would require the “additional amount” of security deposit to be returned to the tenant after no more than six months of residency if the tenant is not in arrears for any rent due during that period and if the higher amount is not due to a prior history of residential property damage. Finally, SB 611 would also prohibit landlords or their agents from charging a tenant a fee for serving, posting, or otherwise delivering any notice.
For a complete list of bills lobbied by CAA, visit the association’s bill chart.
