Lawmaker wants strict rent controls on ‘80s, ’90s units in L.A., San Jose, San Francisco and Oakland and more
The California Apartment Association has a warning for rental housing providers in California’s rent controlled cities: If your property was built in the 1980s or 1990s, it may not be exempt from local rent control much longer.
If passed, SB 466 by Sen. Aisha Wahab, D-Hayward, would become California’s most anti-housing law in a generation. The bill would authorize the expansion of rent control on tens of thousands of rental units across the state, even as California struggles to increase and maintain its meager inventory of housing. Essentially, this legislation says that California would prefer to solve its housing crisis through regulations vs. investment in building the millions of homes needed to address California’s housing shortage.
Undermining the Costa-Hawkins Act
SB 466 aims to undermine the Costa-Hawkins Rental Housing Act, California’s most important rental housing protection law, by introducing a complex and confusing system to bring previously exempt housing units into the fold of strict local rent control laws.
Under the current provisions of Costa-Hawkins, new rental housing is shielded from local rent control ordinances, although the definition of new housing varies based on when rent control was adopted at the local level. For cities and counties that adopted rent control after Costa-Hawkins was signed into law in 1995, new housing means it has a certificate of occupancy issued after Feb. 1, 1995, and cannot be placed under local rent control laws. In cities that adopted rent control before Costa-Hawkins, it’s a different story.
Two systems, shifting eligibility dates
SB 466 seeks to redefine new housing by creating two systems of rolling dates – one for pre-Costa-Hawkins rent control cities and counties, and one for cities and counties with post-1995 rent control.
For the latter, SB 466 would create a 28-year rolling date for eligibility. Under this provision, housing would lose its designation as “new” and would lose its exemption from local rent control as soon as it turns 28 years old, which corresponds with the age of the Costa-Hawkins Act itself. Each year, the eligibility date for these jurisdictions would advance by one year, gradually encompassing a larger portion of the housing stock under local rent control.
Navigating SB 466’s complexities
On the other hand, for cities that had rent control ordinances prior to Costa-Hawkins — such as Los Angeles, San Jose, San Francisco and Oakland — SB 466 would accelerate the process and bring in two years of rental housing annually.
The bill’s bifurcated formulas and shifting eligibility dates would undoubtedly create confusion and uncertainty for housing providers across the state, further burdening landlords in an already challenging rental market, thus encouraging rental housing owners, particularly non-corporate owners to remove units from the rental market.
San Francisco and Los Angeles in focus
To understand the rolling periods for older rent control cities, let’s zero in on San Francisco and Los Angeles. Presently, in San Francisco, housing built before June 1979 is eligible for the city’s rent control ordinance, while in Los Angeles, it’s housing constructed before October 1978. However, if SB 466 becomes law, apartments built in San Francisco before 1981 — a two-year advancement — could immediately fall under the city’s rent control law, and an apartment constructed before 1983 could follow suit the next year. Similarly, in Los Angeles, apartments built before 1980 would become subject to the city’s rent control ordinance upon the passage of SB 466, and apartments constructed before 1982 could fall under rent control the following year. This process would continue until the eligibility date reaches 1995 in L.A. and 1996 in San Francisco, then would advance by one year annually.
Single-family rental owners should be on alert as well. An earlier version of SB 466 would have allowed local rent controls on single-family homes and condominiums. While this provision was stripped from the bill, the agenda for tenant groups is clearly to place single-family homes and condominiums under local rent control as soon as possible.
CAA urges landlords to engage in opposing the passage of SB 466 today. Contact your senator by clicking the button below.
At a glance
Check the table below to see when California apartments built before specific dates would become eligible for local rent control laws should SB 466 be enacted.
|City||Eligible for local rent control if built before (current law)||If SB 466 passes, eligible if built before (Year 1)||If SB 466 passes, eligible if built on or before (Year 2)||If SB 466 passes, eligible if built on or before (Year 3)|
|Los Angeles||Oct. 1, 1978||1980||1982||1984|
|San Jose||Sept. 7, 1979||1981||1983||1985|
|San Francisco||June 13, 1979||1981||1983||1985|
|Oakland||Jan. 1, 1983||1985||1987||1989|