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RED ALERT!

There is a Red Alert, as well as an update on the two other bills you may hear about this week.

First things first -- Red Alert is being sent this morning to ALL members in Assembly Districts represented by Democrats. Since we are not represented by a Democrat in the State Assembly, No Red Alert is being sent and you do not need to take action.

However, we want you to be informed.
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C.A.R. Opposes Bill that Discourages Investment in Rental Housing

C.A.R OPPOSES AB 2364 (Bloom and Chiu), which deters property owners from returning to the rental housing business for 10 years. AB 2364 significantly weakens the Ellis Act by discouraging new rental housing investment and will ultimately make the state’s housing crisis even worse. AB 2364 will be considered by the entire Assembly this week.

Issue Background

In 1985, C.A.R. successfully sponsored the Ellis Act, which is a bipartisan comprise reached by the Legislature to allow rental property owners to go out of business. Prior to the Ellis Act, unlike any other business, rental property owners were forced to stay in business, even when subjected to extreme financial conditions. The Ellis Act provides a reasonable solution that gives certainty to both rental property owners and tenants alike.

Specifically, the Ellis Act requires a property returned to the rental market before a 5-year period expires to include any deed-restricted or rent-controlled units previously located on the property. C.A.R opposes AB 2364 because, among other things, it seeks to weaken the Ellis Act by discouraging rental property owners from returning rental units to the market by effectively extending this 5-year period to 10 years.   

Why C.A.R. is opposing AB 2364

· Discouraging investment in rental housing is bad policy. AB 2364 will have a chilling effect on the state’s housing supply crisis. Substantially diminishing a rental property owner’s ability to return their property to the market will not only limit the number of available units, but also adversely affect property values and the ability to finance property.

· Rental property owners cannot see TEN YEARS into the future. Existing law sets reasonable and foreseeable standards for rental property owners and tenants. AB 2364 imposes unreasonable constraints on rental property owners who simply want to return their property to the market after 5 years.

Updates on Other Bills

AB 2618 (Bonta) is the bill from Legislative Day that requires that licensees get an additional certification to manage property. C.A.R. is OPPOSING this bill. On Friday it was "held" in the Assembly Appropriations Committee, effectively "killing" it for the year.

AB 2925 (Bonta) imposes "just cause" eviction statewide so that a landlord would have to prove in court that there is a "cause" for eviction. That's even if a property owner wanted to move in to their own property and even at the end of a regular lease. C.A.R. OPPOSES this bill. It could be considered by the entire Assembly any day this week, but may not have the votes to pass. Be aware of this bill in your legislator asks about it.

AB 2343 (Chiu), is a bill that will make all rents due in the middle of the month and will significantly extend the eviction process when a tenant has failed to pay the rent, caused a nuisance at the property, or harassed other tenants. It also allows a tenant to simply claim that they are part of a “tenant association” to stop a rent increases, to live rent free, and/or to further delay evictions for the non-payment of rent. C.A.R. OPPOSES this bill in it's current form. HOWEVER, the bill's author is working on amendments. I'll provide you an update on this as soon as I have it.

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