Note: What these two lawmakers don’t realize is that they are still pandering to the renters like they did in San Francisco. Unfortunately, it is to the detriment of the people who PROVIDE the housing! Ammiano will make it harder for landlords to evict deadbeat tenants and Leno will make it unattractive for builders to start new construction on rental property because it will be subject to the same burdensome rent control laws that have hurt real estate in San Francisco for years! So they ask, “Is Sacramento the New San Francisco?”
- Assembly Member Tom Ammiano’s AB 265 Would Create 14-day Notice to Quit
- Senator Mark Leno’s SB 184 Would Eviscerate Costa-Hawkins
(SFAR Note: To increase the presence of the San Francisco’s REALTOR® and the real property owner community at the State Capitol, the San Francisco Association recently retained the services of a well-known Sacramento-based legislative advocate who specializes in landlord-tenant law. The advocate’s name is Ron Kingston. Ron is a former senior lobbyist for the California Association of REALTORS®.
Printed below are two letters Ron has delivered recently on bills under consideration by the State legislature that would significantly affect the rights of owners of rental real property.
One regards Senator Mark Leno’s SB 184 which would authorize the legislative body of any city or county to adopt ordinances to establish, as a condition of development, inclusionary housing requirements.
The other regards Assembly Member Tom Ammiano’s AB 265 which would increase the period of time a defaulting tenant has to pay rent or quit from three to 14 days.)
Assembly Member Tom Ammiano’s AB 265
Dear Assembly Member ________:
On April 26, 2011, the Assembly Judiciary Committee is scheduled to hear AB 265. The San Francisco Association of REALTORS® is OPPOSED to the measure. We respectfully request a NO vote.
The bill requires a court to grant a tenant a right to remain in the rental unit or a right to regain possession of the rental unit if the tenant pays back rent due and nominal legal costs up to and including “lock-out.”
Our reasons to OPPOSE the measure include:
• Rent that is commonly due on the first of each month becomes moot because tenants will be permitted to pay rent much later should AB 265 become law.
• Proponents offer little reason to eliminate existing law requiring proof of hardship for delaying rent payments or reinstating a tenancy. They simple argue, that tenants need more time—a lot more time—to pay monthly rent.
• Today, courts may permit a tenant to remain in a rental unit ONLY in the event of hardship. This bill permits a tenant to, for any reason, remain in possession upon paying the delinquent rent and a small portion of the landlord’s legal costs. Other out-of-pocket costs for damages, lost rent, etc. would be lost.
• Tenants who proffer insufficient rent payments or those who are habitually late in the payment of rent are the most likely to take advantage of a “new” law that would permit them to, without cause, pay until “lock-out.” This is not fair to responsible tenants and landlords.
• Tenants could avail themselves of the “new” law on repetitive occasions, thus making it extremely expensive and frustrating for landlords. There would be no finality.
• The bill would increase the number and cost of unlawful detainer actions. Landlords will be forced to unjustly pay legal and court costs in every eviction action.
• Tenants would never have to file an answer to an unlawful detainer complaint, never appear in court, never pay reasonable attorneys fees, processing fees, and more and then, at the last moment, pay past due rent. Costs to landlords would skyrocket.
• Landlords would not ever know the status of a lawsuit until the bitter end. Landlords would not be able to enter into contract with a NEW TENANT in a timely manner because he or she would not know the status of the current unit.
• Late payment of rent will never result in an “adverse credit report.” No other creditor is prohibited from reporting late payments to a credit bureau.
• The bill mandates that landlords are to accept delinquent rent that may be paid months following the rent due date.
We respectfully urge you to vote NO on AB 265.
Senator Mark Leno’s SB 184 Would Eviscerate Costa-Hawkins
Dear Senator ___________:
On May 3, 2011 the Senate Transportation and Housing Committee is scheduled to hear SB 184. The San Francisco Association of REALTORS® is strongly OPPOSED to the measure and urges your NO vote.
The bill would assure that every local government could enact and enforce residential rent control on newly constructed units and prohibit property owners from pursuing lawful judicial remedies against a city or county for violating the law, including the long-standing Costa Hawkins Act.
Without exception local government rent control ordinances exempt newly constructed rental housing.
State and local legislators alike have consistently understood, embraced, and advocated for exempting new rental construction from rent control.
In fact, the legislature assured Californians that new rental housing would not be subject to rent control in 1995 through the Costa Hawkins Act.
For more than 30 years local government’s rent control laws have exempted newly constructed rental housing yet, many of those same governments adapted and enforced conflicting inclusionary zoning laws (laws that impose rent control on 10-30 percent of the newly constructed housing for no less than 30-years or require the property owner to pay mandatory in-lieu fees to that government of well over $100,000 per unit).
Among our reasons to OPPOSE the bill:
• Proponents argue the bill “simply” authorizes local government inclusionary zoning laws (a law, commonly referred to as rent control on newly constructed housing). Inclusionary zoning conflicts with:
• The Costa-Hawkins Act (Statutes of 1995) that established statewide new construction exemption for rental housing.
• The long-standing guarantee of local and state elected officials that newly constructed housing would always be exempt.
• Palmer/Sixth Street Properties, L.P. et al., v City of Los Angeles that held, without equivocation, that the City of Los Angeles inclusionary zoning ordinance is preempted by the Costa Hawkins Act.
• This bill is NOT A PERMISSIVE MEASURE, it is a bill that would stop any lawful challenge against a city or county. Mr. Palmer successfully litigated against the City of Los Angeles. Others should be given the right to litigate.
• There is NO CONFUSION about the intent and verbiage of the Costa-Hawkins Act: Civil Code Section 1954.52 (a) Notwithstanding any other provision of law, an owner of residential real property may establish the initial and all subsequent rental rates for a dwelling…. (If) a certificate of occupancy (was) issued after February 1, 1995. The Legislature did enact a bill that did occupy the field on newly constructed rental housing rental rates.
For the Legislature to set aside the Costa-Hawkins Act, it:
• Will take away an important incentive for developers to construct rental housing; and
• Will seriously damage the construction industry.
• Will assure litigation since inclusionary housing (rent control requirements) ordinances and the Costa-Hawkins Act are in conflict with one another.
• Will preempt the Costa-Hawkins Act, without amending that area of law.
• Will destroy the notion long acknowledged by the State legislature that the State should occupy the field in certain and defined areas relating to rental housing. This is not a local control issue. If it were, planning and zoning laws, landlord and tenant law, and most every State statute would not be necessary.
The Costa-Hawkins Act and inclusionary zoning are in direct conflict with each other. If newly constructed rental housing is to remain exempt from rent control, the bill should be rejected by the Legislature.
We respectfully urge you to vote NO on SB 184.