Proposed California Legislative Bills Affecting Landlords

New California Bills affecting Landlords:

 

AB 1436 (Chiu) Tenancy: Rental Payment Default: State Of Emergency: COVID-19 - AB 1436 prohibits a rental property owner from evicting a tenant for COVID-19 back rent accrued before April 1, 2021. Under the bill, rental property owners are prohibited from pursuing a civil action to recover COVID19 back rent until April 1, 2022. C.A.R. opposes AB 1436 which effectively alters rental contracts. C.A.R. opposes the bill because it is unconstitutional and provides no financial protection for “mom and pop” property owners, who must still pay their mortgages and have a legal obligation to repair and maintain their properties. Furthermore, AB 1436 has been amended to include foreclosure moratorium provisions that could lead to higher mortgage costs for California homebuyers and owners and are also even more likely to be unconstitutional! AB 1436 is pending a hearing in the Senate Judiciary Committee on August 18.

 

SB 1410 (Caballero) COVID-19 Emergency: Tenancies - Under SB 1410’s new program, a property owner and a tenant may enter into an agreement that allows a tenant to defer any back rent accrued during the COVID-19 state of emergency and an unspecified number of days thereafter. Beginning in 2024, the tenant would have 10 years to pay that COVID-19 back rent to the state, and the property owner would get, in turn, tax credits equal to the amount of that COVID-19 back rent. Unfortunately, SB 1410, among other things, severely limits the ability of a property owner to evict a tenant for practically any reason during the COVID-19 state of emergency and an unspecified number of days thereafter, regardless of whether the property owner participates in the program. Meaning, a property owner who declines to participate in the program would be unable to evict a tenant for nuisance or other serious violations of the lease agreement. This limitation also applies retroactively, which is impracticable. C.A.R. will oppose SB 1410 until it is amended to remove the burdensome limitations on the ability to evict for a property owner who does not participate in the program created by the bill. SB 1410 is to be heard in the Assembly Judiciary Committee on August 19.

 

SB 1190 (Durazo) Tenancy: Termination - Existing law allows specified crime victims to break their leases if they provide specified documentation that the crime occurred (e.g., a copy of a police report). SB 1190 dramatically expands this “break lease” mechanism and, in doing so, undermines prior legislative intent by, among other things, allowing “any other form of documentation” that reasonably verifies the crime occurred. Unfortunately, this language is amorphous and will lead to increased litigation as it does not provide certainty to property owners and tenants regarding what is an acceptable form of documentation. C.A.R. will oppose SB 1190 until these poorly drafted provisions are redrafted to provide that certainty. SB 1190 is pending on the Assembly Floor

 

SB 902 (Wiener) Planning and Zoning: Density SB 902 permits local governments to exempt projects of 10 units or less, from any additional CEQA review if the parcel is located in a transit-rich area, jobs-rich area, or an urban infill site. SB 902 requires developers to follow all local objective design criteria, local impact fees, local height and setback limits, and local demolition standards. Furthermore, SB 902, specifically prohibits projects from accessing streamlined approvals if the project is located in a high fire severity zone, state or national historic district, or requires the demolition of rent controlled units. C.A.R. supports this measure, which seeks to identify solutions to the state’s housing crisis by encouraging the development of new housing units within existing communities identified as transit-rich, jobs-rich, or on an urban infill site. SB 902 is pending in the Assembly Appropriations Committee.  

 

SB 1299 (Portantino) Commercial Property Conversions into Housing – Upon appropriation by the Legislature, SB 1299 requires the Department of Housing and Community Development (DHCD) to provide grants to local governments as a way to incentivize cities and counties to rezone empty big box retail stores and vacant commercial shopping centers to instead allow the development of workforce housing (up to 120% or the area median income). C.A.R. supports this measure as it seeks to help families afford to live within the communities in which they work. SB 1299 is pending in the Assembly Appropriations Committee.   

 

*August 21st is the last day for fiscal committees to meet and report bills; therefore, bills must clear the Appropriations Committee this week to be eligible for a floor vote.