If you don't see images in this message, click "Display Images" or the equivalent.
E-207 - Thursday, August 8, 2019
Advertise in The Nooner to reach over 8,000 readers
RECENT AURAL PLEASURE:
IN TODAY'S NOONER:
Nooner Premium - I got stuck on a call and hadn't spellchecked the 11:30am version.
Lawsuit information page for SB 27 (McGuire and Wiener): Primary elections: ballot access: tax returns.
Happy Thursday! You're almost there and this will be an important weekend to enjoy before the cray-cray factor is turned to 11 when the Legislature returns Monday for its final four weeks of work this year.
A reader sent me some suggestions for changes to our Nooner Sofa Degree list. If your a Nooner newbie, this has been an evolving list of the books that can get someone a university-style education in politics and policy from the comfort of home. Not really, of course, but you get the gist.
Now is a great time to change the list up as Capital Books on K plans to start stocking the books, where possible. Others are easily picked up used online, including from the great Powell's City of Books in Portland. The list has links to that jungle store, but by all means, buy it locally and independently if possible.
Let me know your current thoughts on the list. If you have an addition, ideally suggest a subtraction. Are there current and perennial issues, such as housing, that are not reflected?
Anyway, interim recess will be here before we know it which will be great time to pick up these books for a good read to earn those "credits" toward your Sofa Degree.
beJUULed: For the Chron, Catherine Ho looks at the referendum sponsored by JUUL to overturn the recent San Francisco ordinance to ban the sales of e-cigarettes with flavors other than tobacco, with a wind-down until January 1, 2020 to allow retailers to liquidate their stock. The voters of the City and County voted to prohibit the sales of flavored tobacco--conventional and electronic--last year, while the referendum effort coincides with the Legislature's discussion on the sale of tobacco products, including flavored products containing nicotine.
New to California politics and policy? San Francisco is the lone "city and county" in the state, where an elected eleven-member board of supervisors and directly elected mayor govern the chartered coterminous city and county.
Meanwhile, fentanyl deaths were up 150% in 2018 in San Francisco over the previous year, reports Lauren Hernández for the Chron.
In other news from Baghdad by the Bay, the state's Bureau of Cannabis Control yesterday granted a license to "Grass Lands" at the popular music festival Outside Lands this weekend. It's certainly not the first time that there will be grass on the grass of Golden Gate Park, but the first time it will be sold legally by licensed vendors. The license is limited to a dedicated area with access limited to adults 21 and over. So, participants can gobble gobble before returning to sit to go to Graceland with Paul Simon.
SB 276 (Pan): IMMUNIZATIONS: MEDICAL EXEMPTIONS: Obviously, the vaccination bill will make our Seven Bills in Seven Days list as well as the independent contractors (Dynamex) one. I save the best for the end of the week/weekend. After today, there are only three spots with lots of honorable mentions. For today, I'll just note the irony on the two bills. On AB 5 (Dynamex), transportation network companies offered compensation for time, gas, and food for protestors in opposition to the bill. On SB 276 (vaccinations), opponents are charging/asking for donations from would-be so-aligned protestors to help offset costs.
EDUCATION MATTERS: The Public Policy Institute of California is out with a new report on where Local Control Funding Formula ("LCFF") dollars are ending up and whether they are helping the neediest students as intended. Unsurprising answer: it's mixed. For EdSource, John Fensterwald writes about the new report.
SEVEN BILLS IN SEVEN DAYS - housing/rent caps - and #CAKEDAY after the jump...
SEVEN BILLS IN SEVEN DAYS
This series is a simplification of issues to illustrate the legislative process. They are not meant to be comprehensive analyses of all the issues raised by proponents and opponents, which would simply not be possible in the space allowed in The Nooner.
AB 1482 (Tenancy): rent caps.
Location: Senate Appropriations
Summary: From Senate Judiciary: This bill limits "rent-gouging" in California by placing an upper limit on annual rent increases: 7 percent plus inflation, up to a maximum of 10 percent, for specified housing that is over 10 years old. To prevent landlords from engaging in rent-gouging by evicting tenants, the bill also requires that a landlord have and state a just cause, as specified, for any eviction. Landlords with 10 or fewer rental properties are exempt. The bill sunsets after three years and does not preempt any local rent control ordinances.
Background: Local rent control ordinances are currently limited to fifteen cities that adopted them prior to the enactment of the Costa-Hawkins Rental Housing Act in 1995. Attempts to repeal Costa-Hawkins both legislatively and by ballot measure have previously failed, including in last November's Proposition 10, which failed 40.6%-59.4%.
Current law allows landlords in areas without a local rent control ordinance, in absence of a fixed-term lease, to raise residential rents with at least 30 days’ notice for rent increases of up to 10 percent, cumulatively, per year; or at least 60 days’ notice for rent increases of 10 percent or more, cumulatively, per year. Current law further allows landlords, in the absence of a local eviction control ordinance or a fixed-term lease, to terminate a tenancy unilaterally without stating a reason with at least 30 days’ notice for tenants who have occupied the premises for less than a year; or at least 60 days’ notice for tenants who have occupied the premises for a year or more.
Support: Labor organizations, cities of Los Angeles and Santa Monica, Association of Bay Area Governments, and numerous community-based organizations and individuals
Opposition: AIDS Healthcare Foundation, California Apartment Association, California Association of Realtors, California Business Properties Association, California Chamber of Commerce, numerous other business organizations and individuals
Proponents argue: There is a housing emergency and unscrupulous property owners are raising rental rates well beyond economic indicators such as inflation and the change in personal income. Further, property owners are frequently evicting tenants without cause for the purposes of raising rents further than such indicators would suggest to rates well beyond a reasonable rate of return on their investment.
Opponents argue: There is a housing emergency that requires a significant increase in the state's housing stock. The only effective way to do that is by reducing onerous limitations on development and by attracting private investment. That investment involves risk which is even greater during the current housing crunch. By capping increases below market rate and implementing new restrictions, investors will be deterred from addressing the state's housing needs through increased housing stocks. The state should focus on and address the regulatory impediments to new construction and increased enforcement of existing renter protections.
Why this is Noonerifically interesting: Over several years, legislators (and voters) have sought to amend the Costa-Hawkins Act to allow rent control in cities that didn't have grandfathered ordinances the pre-dated 1995. As noted above, the most recent effort was Proposition 10 which was soundly defeated last November after a colossal campaign with over $25 million spent in favor and over $75 million spent in opposition.
This bill seeks a different approach than Proposition 10, using the "price-gouging" approach rather than associating rent increases with cost-of-living indicators. Price-gouging laws generally limit the increase in price of goods, such as gasoline and bottled water, to a specified percent during a time of declared emergency. This bill essentially recognizes a statewide emergency in housing and imposes limits under certain circumstances until January 1, 2023, would take effect January 1, 2020, and would apply the limits from March 15, 2019. The limitation would be going forward only and would not require landlords to reimburse for amounts charged above the cap between March 15 and January 1, 2020.
The AIDS Healthcare Foundation, an entrepreneurial foundation that franchises online pharmacies and an HMO, sponsored the unsuccessful Proposition 10 in 2018 and is currently collecting signatures for a similar measure for November 2020. The foundation also operates the Healthy Housing Foundation, which owns residential rental properties and frequently weighs in on land use issues, including opposing the controversial SB 50 (Wiener), the stalled bill that would have overridden local zoning preferring single-family housing near transit and job corridors. In opposition, the Senate Judiciary analysis quotes the AIDS Healthcare Foundation opposition:
"Unfortunately, the bill in its current form addresses the 300% aberration but fails to correct the far more ubiquitous problem, which is landlords who raise rents beyond getting a fair return on their investment; they may not be raising eyebrows, but they are pricing more and more low-income tenants out of their homes.
Even worse, the bill creates a new floor for landlords who will now have the state’s permission to increase rents by 8% to 10% every year for the next three years."
The AIDS Healthcare Foundation is joined with an assortment of business interests, which write in opposition:
"Study after study has demonstrated that price controls end up crippling the commodity that is controlled, including housing. There may be a short-term reduction in the price of rent-controlled units, but over the mid to long run, controlling rental prices decreases inventory as property owners remove units from the market, and construction of new rental housing slows. As rental units dwindle in a city or region, working-class families, seniors, and others in need experience the most harm.
AB 1482 would further complicate California’s ongoing housing crisis and would have very serious and harmful consequences to our economy. Governor Newsom has called for the construction of 3.5 million new housing units by 2025, or an average of 500,000 a year. Considering that California has built an average of 80,000 new homes per year over the past decade, AB 1482 will certainly get in the way of this goal."
Also opposed is the California Association of Realtors (CAR), which is one of the most powerful Sacramento interests and plays heftily in elections particularly through independent expenditure committees, often joining with other influential groups on behalf of moderate Democrats in races against more liberal members.
The bill passed the Assembly with 43 votes in favor, meaning proponents only had two votes to spare. As a majority vote bill and with 29 Senate Democrats, eight Dems can take a walk and the bill will still pass.
Of course, it's not that simple. It is unclear whether Governor Newsom wants this particular bill as part of his housing strategy. He recently responded to a court ruling on the previous use of the state's portion of the national mortgage settlement associated with the 2008 financial Great Recession. The state previously used funding as a General Fund offset for payments on existing state-backed housing bonds. The courts ruled that the expenditure was an inappropriate supplantating of existing, rather than new, efforts toward housing affordability. The money will not be used for increased enforcement of existing legal protections.
While it appears that the votes are there for the bill to pass the Senate and Assembly (concurrence) floors, that doesn't mean the bill will land on Governor Newsom's desk. If he doesn't want to see for consideration, he is still on a significant honeymoon with the the Legislature's majority Democrats, having spent many of the final days of his 2018 campaign stumping for Democrats in tough races, most of whom won.
Watch Senate Appropriations, where the bill could remain parked on the "Suspense File," without a vote on substance. If it is released from suspense on August 29 or 30, consider it a sign that a positive signal has been sent from the governor's office.
#CAKEDAY: Happy birthday to Chris Lehman and Christopher Pickard!