A bill that would apply rent control and price-gouging protections statewide advanced today from its first committee hearing, while a second rent control proposal stalled amid strong opposition from CAA.
The Assembly Committee on Housing and Community Development approved AB 1482.
The bill would apply to every rental unit in California and limit annual increases to 5% plus the rate of inflation. The proposal now heads to the Appropriations Committee.
The committee was also scheduled to take up a second rent control bill, AB 36 by Assemblyman Richard Bloom, D-Santa Monica, however, the author pulled the item. Bloom’s bill would weaken California’s Costa-Hawkins Act, allowing cities and counties to expand local rent control laws to buildings as they turn 10 years old, as well as to single-family homes.
Debra Carlton, CAA’s senior vice president of public affairs, provided lead testimony against AB 1482. Increasing California’s housing supply is truly the way to protect both current and future tenants, Carlton said.
“We certainly don’t want to scare off development, and I know, as the Assembly members stated, it takes years to build housing, and that’s shameful in California,” she said, citing a case in which a developer has had to wait 13 years to even start construction.
Chiu has characterized AB 1482 not as rent control, but as a ban on rent gouging. He said the bill is modeled after existing California law that prohibits price increases exceeding 10% on consumer goods following declarations of emergency.
CAA has concerns about the fluidity of the CPI plus 5% figure in AB 1482. At present, the legislation offers no assurances that a future Legislature won’t lower the threshold – a phenomenon seen with local rent control laws, Carlton said.
Despite testimony from CAA, the REALTORs and the California Chamber of Commerce, and a strong showing by rental property owners, the committee chose to advance the bill. First, however, Chairman Chiu committed to work on amendments that lessen concerns over stifling construction and provide long-term stability for both renters and rental property owners.
After the hearing, Tom Bannon, chief executive officer of CAA, reiterated the association’s opposition to AB 1482, saying it fails to address the underlying causes of California’s housing crisis and could make the problem even worse.
Instead of controlling rents, which deters additional affordable housing, policymakers should focus on quickly adding housing that’s affordable to working-class families and bringing the state’s job-to-housing ratio into balance, said Bannon.
With the other rent control bill, AB 36, likely sidelined for 2019, Costa-Hawkins is presently safe in the Legislature. The law, however, has again come under attack from Michael Weinstein, the main financier of Prop 10. Last week, Weinstein filed preliminary paperwork to place another Costa-Hawkins measure before voters in 2020.
This information provided by www.caanet.org.
