News Alert: Costa-Hawkins Rental Housing Act Threatened Again
NEWS ALERT: Important Updates for Members
Costa-Hawkins Rental Housing Act Threatened Again
The Costa-Hawkins Rental Housing Act is a state law that places limitations on local rent control laws. These limitations include exempting from local rent control any residential rental properties that are single family homes, condominiums, or built after the passage of the earlier of (i) the passage of local rent regulation or (ii) February 1, 1995. In addition, Costa-Hawkins requires “vacancy de-control,” which is the right of all rental housing providers to establish the initial rental rate after a vacancy. Recently, Costa-Hawkins has again been under attack and is being threatened with repeal both by the state legislature, and also by a proposed, new ballot initiative.
Proposed State Legislation. The proposed, state bill, Senate Bill 466 by Senator Wahab (D-Fremont), would dismantle one of the protections from rent control currently afforded rental housing providers by removing the right of an housing provider to establish the rental rate unless a property received a Certificate of Occupancy within the past 15-years. In other words, properties built since 1995 (or earlier) will no longer be exempt from local rent regulations, rather the new exemption date will be (as of today’s date) March 1, 2007 and that date will continue to advance so that this exemption will apply only to properties obtaining their conditional use permit within the past 15-years.
For example, properties subject to the City of Los Angeles’ Rent Stabilization Ordinance are properties that were issued a Certificate of Occupancy on or before September 30, 1978, and anything on or after October 1, 1978 are exempt. If Senate Bill 466 passes and is signed into law by Governor Newsom, properties built between October 1, 1978, through March 1, 2007 (and thereafter) will fall under the City of Los Angeles’ Rent Stabilization Ordinance.
Proposed Ballot Initiative. In addition, various well-organized, and extremely well-funded tenants’ rights groups have submitted a November 2024 ballot initiative similar to past Propositions 10 and 21. This latest threat to Costa-Hawkins, the so-called “Justice for Renters Act,” would dismantle Costa-Hawkins and would allow local jurisdictions to have complete control over regulating rental housing, including control over rental pricing upon a vacancy for all types of rental housing, including single family homes, condominiums and new construction. If this ballot initiative were to pass in 2024, all types of residential rental properties could be subjected to local rent control ordinances, and local governments could control rental rates for vacant units. Prior to the passage of Costa-Hawkins, cities like Santa Monica had “vacancy control” in place and controlled the amount rent housing providers could charge upon a vacancy.
Text of the Justice for Renters Act: Title and Summary Cleared for Circulation
EXPANDS LOCAL GOVERNMENTS’ AUTHORITY TO ENACT RENT CONTROL ON RESIDENTIAL PROPERTY. INITIATIVE STATUTE. Current state law (the Costa-Hawkins Rental Housing Act of 1995) generally prevents cities and counties from limiting the initial rental rate that landlords may charge to new tenants in all types of housing, and from limiting rent increases for existing tenants in (1) residential properties that were first occupied after February 1, 1995; (2) single-family homes; and (3) condominiums. This measure would repeal that state law and would prohibit the state from limiting the right of cities and counties to maintain, enact, or expand residential rent-control ordinances. Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on the state and local governments: Overall, a potential reduction in state and local revenues in the high tens of millions of dollars per year over time. Depending on actions by local communities, revenue losses could be less or more. Proponent Ashoke Talukdar, c/o Fredric D. Woocher, Esq. atfwoocher@strumwooch.com, needs 546,651 valid signatures by August 28, 2023.
On February 28th, supporters of the proposed ballot initiative announced that the measure has been cleared for circulation and signature gathering. Like Propositions 10 and 21 before it, this ballot initiative is being underwritten by Michael Weinstein, the President of the AIDS Healthcare Foundation (See article, “Under Attack Again: Costa-Hawkins - What is It and Why Should You Care?” in the March issue of Apartment Age magazine.)
Call to Action.
Don’t let the proposed Senate Bill 466 and November 2024 ballot initiative, “Justice for Renters Act” gain traction and pass. Give us the financial support needed to FIGHT-BACK and to WIN! Help to ensure the voice of reason and common sense is heard and that your property rights and values are preserved. HELP US KEEP COSTA-HAWKINS ALIVE! Any and all contributions to our Political Action Committee will help us to achieve success in turning back the tide of regulations against us. Thank you in advance for your continued support! Contribute today at www.AAGLA.org/IssuesPAC. It took about $80 million to $90 million to defeat each of Propositions 10 and 21 – Please give generously.
Los Angeles County to Finally End COVID-19 Emergency Declarations on March 31st
The Los Angeles County Board of Supervisors agreed on Tuesday, February 28th to end the County’s declared local emergency due to COVID-19 at the end of March. County officials have warned; however, that the termination of the emergency declaration does not mean the virus no longer poses a threat to County residents. That same day, Gov. Gavin Newsom formally rescinded the statewide COVID-19 emergency declaration issued nearly three years ago during the onset of the coronavirus outbreak.
The Apartment Association of Greater Los Angeles’ lawsuits against the City of Los Angeles and County of Los Angeles concerning moratoriums on evictions are ongoing. Please help contribute to our legal costs by making a generous contribution to the Apartment Association of Greater Los Angeles Legal Fund at www.AAGLA.org/LegalFund.