Mid-year report: Key legislation opposed by CAA this year

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Lawmakers this year introduced more than a dozen bills that the California Apartment Association deemed threatening to the rental housing industry.

Below you’ll find summaries of some of the worst housing legislation of 2017 and the status of each bill in the legislative process.

Bill seeks to repeal Costa-Hawkins, the law that protects owners from extreme forms of rent control

AB 1506 by Assemblyman Richard Bloom, D-Santa Monica, would repeal the state law known as the Costa-Hawkins Rental Housing Act, giving all cities and counties the ability to impose rent control ordinances without limits. Costa-Hawkins has protected California from extreme forms of rent control for more than 20 years. Under the Costa-Hawkins Act, apartments built after 1995 are exempted from local rent control laws, as are single-family homes. Costa-Hawkins also allows a property owner to set the rent at the market rate once a tenant moves out and a new tenant moves in – known as vacancy decontrol. Amid strong opposition from the California Apartment Association, legislators decided to make AB 1506 a two-year bill, meaning the author decided not to move forward with the bill this year. He can, however, take it up in 2018.
Position: Oppose
Status: Assembly Housing and Community Development Committee, two-year bill

Proposal would weaken the Ellis Act, the state’s rent control escape hatch

AB 423 by Rob Bonta, D-Alameda, would exempt residential hotels in Oakland from the protections of the state’s Ellis Act, the law that allows property owners to close their buildings and leave the rental market. San Francisco, Los Angeles and San Diego already have exemptions from the Ellis Act for residential hotels. Since 1985, the Ellis Act has provided an important safety valve for landlords operating in rent controlled jurisdictions, guaranteeing they can walk away from the business when rent control becomes too burdensome.
Position: Oppose
Status: Assembly Floor, two-year bill

AB 982 by Assemblyman Richard Bloom, D-Santa Monica, would have expanded the number of tenants who are entitled to receive a year’s notice from a landlord before that owner closes a building as allowed under the Ellis Act. Under current law, tenants who have lived in the unit for at least one year and who are at least 62 years of age or are disabled are entitled to a year’s notice from the landlord before the building is closed. Other tenants are entitled to a 120-day notice. AB 982 would have extended the one-year notice requirement to all tenants, regardless of age or disability.
Position: Oppose
Status: Assembly Housing and Community Development Committee, two-year bill

Bill would undercut density bonus law in San Francisco

AB 915 by Assemblyman Philip Ting, D-San Francisco, would undercut the state’s density-bonus law and make housing in San Francisco more expensive. If authorized by the State Department of Housing and Community Development, AB 915 would allow San Francisco to count added density bonus units when calculating the total number of affordable units required for a development. The state’s density-bonus law gives developers an incentive to include affordable housing in their projects. In exchange for including affordable units, developers get to build more market-rate units, helping their projects “pencil out.” AB 915, however, would force developers to price a portion of their density-bonus units below market rate, removing the very incentive that density bonuses are intended to create.
Position: Oppose
Status: Senate Transportation & Housing Committee

Proposals threaten housing policies along California coastline

AB 663 by Assemblyman Richard Bloom, D-Santa Monica, would remove control over housing policy from local governments in the coastal areas and give it to the California Coastal Commission. The Coastal Commission previously had such authority but lost it under a law passed in 1981. During debate over the 1981 law, local governments and developers demonstrated numerous problems and inconsistencies with the commission’s housing policies. At this stage, the Coastal Commission could bring to coastal areas policies such as rent control, negative inclusionary zoning laws, and downzoning restrictions that are harmful to housing production.
Position: Oppose
Status: Appropriations Committee, two-year bill

AB 1129 by Assemblyman Mark Stone, D-Santa Cruz, would prohibit most coastal properties and infrastructure from armoring and protecting against erosion and rising sea levels. It prohibits the construction of erosion protection for structures that were built after Jan. 1, 1977. AB 1129 would also prohibit any measures performed in an emergency and would subject building owners to administrative penalties.
Position: Oppose
Status: Assembly floor, two-year bill

Labor-related bills onerous to rental industry, other businesses 

AB 1701 by Tony Thurmond, D-Richmond, would hold a general contractor jointly liable with a subcontractor when a subcontractor fails to pay an employee’s wages and/or make benefit contributions or payments.
Position: Oppose
Status: Senate Judiciary Committee

AB 1008 by Assemblyman Kevin McCarty, D-Sacramento, would provide that it is an unlawful employment practice for an employer to include on any application for employment any question that seeks the disclosure of an applicant’s criminal history. The bill also would bar employers from asking an applicant about any convictions until the employer makes a conditional job offer. The ability to screen prospective employees for past criminal activity is particularly important in the rental housing industry, as employees work around children at rental properties and are granted access to tenants’ units and personal possessions.
Position: Oppose
Status: Senate Appropriations Committee

SB 306 by Sen. Robert Hertzberg, D-Van Nuys, would provide the Labor Commissioner with significant authority to obtain injunctive relief at any time during an investigation. This would disrupt the workforce and expose employers to constant threats of civil proceedings and costs, as well as excessive penalties for simple posting violations.
Position: Oppose
Status: Assembly Appropriations Committee

AB 814 by Assemblyman Richard Bloom, D-Santa Monica, would extend the power to enforce laws related to unfair competition to city attorneys in cities with a population exceeding 750,000. Current law only grants that power to the California Attorney General and district attorneys.
Position: Oppose
Status: Senate Appropriations Committee

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