One California Rent Control Proposal Advances as Another Measure Stalls

One California Rent Control Proposal Advances as Another Measure Stalls

Legislation Would Limit Annual Rent Hikes to 5% Above the Cost of Inflation

BY RANDYL DRUMMER (via CoStar Group)

California State Capitol. Photo: iStock

California State Capitol. Photo: iStock

A bill that would prohibit California landlords from imposing what supporters call “egregious” rent increases has cleared a key hurdle in the state legislature, hours after lawmakers shelved the latest proposal to expand rent control to address the Golden State’s growing housing affordability crisis.

The California Assembly Housing and Community Development Committee, by a vote of 6 to 1, moved to advance San Francisco Assemblyman David Chiu’s Assembly Bill 1482, which would limit annual rent increases to 5% higher than the cost of inflation to prevent sharp hikes by landlords in a state where median asking rents for apartments have increased by 43% to more than $1,900 in the past decade. It needs support from the full state legislature and governor to become law.

Many of California’s 17 million tenants don’t have safe and affordable housing, and the state cannot afford to wait until the estimated shortfall of 3.5 million housing units is built before addressing the crisis, Chiu said at the committee hearing.

“We have millions of tenants who are one rent increase away from not being able to put food on the table, get health care or who are at risk of being homeless,” Chiu said. “Our anti-rent gouging bill is a critical protection that will help renters while still allowing landlords to make a healthy return. It is meant to protect tenants against the most egregious rent increases, no matter where they rent or what kind of unit they live in.”

Developers, landlords and other business and economic development groups have effectively battled statewide rent control in California for more than 20 years, since the state enacted restrictions prohibiting local rent control on units built after 1995. It has allowed landlords to raise rents at unbridled rates that many argue have contributed to pushing the state’s housing costs to among the highest in the nation.

This bill is the latest effort by California lawmakers and stakeholders to try to grapple with the worsening housing crisis. In the past week alone, a division of Los Angeles advocacy group AIDS Healthcare Foundation, called Housing is a Human Right, filed papers with the California Attorney General’s Office. That came after acquiring enough signatures to place apartment rent control back on the California ballot while another effort to boost affordable housing by easing height and density limits near transit hubs was passed 6 to 1 by a key California Senate committee.

Hundreds of affordable housing and housing industry advocates attended the Assembly committee hearing with the expectation of supporting or opposing a different bill known as Assembly Bill 36, the first major rent control legislation since California voters rejected Proposition 10 in November 2018. Private landlords joined the California Apartment Association and other groups to speak in opposition of the bill, while housing advocates, including the Alliance of Californians for Community Empowerment, urged lawmakers to advance the measure.

Assemblyman Richard Bloom, a Democrat from Santa Monica who authored the AB 36 proposal, requested that it be pulled from the committee’s agenda and sent it back to the rules committee for “more work,” effectively stalling the bill’s progress for the year, according to Chiu.

California Gov. Gavin Newsom, who has put solving the state’s housing affordability crisis at the center of his administration’s goals, applauded the vote to move forward on “one piece of the housing affordability solution – creating a renter protection package,” while calling for more dramatic action by lawmakers.

“I look forward to continuing this important conversation as proposals move through the legislative process,” Newsom said in a statement.