Legislative Update: California Housing Crisis

The California housing crisis is a legislative hot topic that has been in the news of late!  According to a report prepared by the California Department of Housing and Community Development, new home building is on the decline while there has been a steep increase in rents over the years, which has proven burdensome for many California families.

The blame game is on:  Recently, the Legislative Analyst’s office prepared a report attributing the housing crisis to local government refusal to build and provided suggestions for hastening construction.  Despite alleged pushback from local communities, legislators are continuing in their efforts to make reforms in the areas of rent control and building expansion.

Below are some of the more recent ideas coming out of Sacramento:

  • Governor Jerry Brown’s proposed budget plan in May of 2016 included a push to increase housing, but failed a few months later.  So he is giving it another shot, this time with a new proposal set forth in January of this year that would provide local government incentives and make the lengthy building approvals process more efficient.
  • Senate Bill 2, urgency legislation proposed by Senator Toni Atkins, entitled the Building Homes and Jobs Act, would add additional property transfer fees of between $75 and $225 (excluding home sales) with the goal that some of the proceeds would pay for low income and migrant housing.
  • The Costa-Hawkins Rental Housing Act (Civil Code sections 1954.50 – 1954.535) of 1995 (Assembly Bill 1164) restricts the kinds of housing shielded by local rent control laws and inhibits cities from protecting renters.  For example, the Third Reading analysis of the measure as last amended prepared by the Office of Senate Floor Analyses provided that pursuant to Civil Code section 1954.52: “During the three‑year phase‑in period, the amended provisions would allow either a rent increase of 15 percent or to up to 70 percent of the prevailing market rate for a comparable unit, upon a voluntary vacancy.  As before, two increases would be permitted in that three‑year period.  After the phase‑in, there would be no limits on permissible rent increases.”  Assemblymember Richard Bloom is now challenging Costa-Hawkins with Assembly Bill 1506, which proposes to repeal the 1995 law and permit localities to enact new rent control rules or to toughen those already in existence.



Other western states are also grappling with the housing crisis:

  • Oregon is doing their part this session – House Bill 2004 is currently making its way through the legislature and would prohibit the bulk of “no-cause” evictions and permit cities to authorize rent control rules.  Oregon has five other pending bills targeting the housing crunch: House Bill 2001, House Bill 2003, House Bill 2240, House Bill 2215 and Senate Bill 151.
  • Some Washingtonians believe their state legislature has not gotten its act together, so Seattle and other city councils in the state took the bull by the horns last year and passed several ordinances protecting renters.  However, it is possible that this could be the year the state legislature in Olympia passes a bill aimed at outlawing income-based housing discrimination.  All eyes are on the Washington lawmakers.

Legislative Intent Service, Inc. has been providing legislative research for over 40 years.  We have a voluminous archive of legislative history materials, including such bills as Assembly Bill 1164 of 1995, which enacted Costa-Hawkins.  If you would like more information on any of the legislation mentioned in this article, or if you are interested in research on any other topic, be it statutory or regulatory, we can help.