Note to readers: Each week through November 2019, a selection of our 101 California Influencers answers a question that is critical to California’s future. Topics include education, healthcare, environment, housing and economic growth.
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California Influencers this week answered the following question: What is the best way for CA to protect renters from being displaced? Below are the Influencers’ answers in their entirety.
Landlords hold all the cards. It’s time to deal renters in
Lisa Hershey - Executive Director of Housing California
Journalist Sophie Kasakove describes the landlord-tenant relationship as “a profit model that relies on instability for tenants.” Such instability is a root cause of displacement in California – often because rent far outpaces wages.
Such instability requires intervention. California’s 17.5 million renters deserve relief from landlords hiking rent by as much as 100%, protection from eviction without “just cause,” and a right to counsel when an eviction notice arrives. Predatory landlords need accountability – an end to egregious rent hikes, code violations, and discrimination against renters who use Housing Choice “Section 8” vouchers.
These measures might be dreams elsewhere; but, Governor Newsom can make them reality in California. With the swift action of his pen, he can sign SB 329 to end discrimination against the more than 300,000 Californians of modest means who use a Housing Choice Voucher. And as Speaker Rendon so aptly stated, when the Governor signs AB 1482, he “puts teeth in tenant protections without taking an unreasonable bite from property owners,” by enacting a rent cap and barring evictions without “just cause” statewide.
The legislature played its cards strategically. Now the Governor can deal the winning hand towards a California for all.
Rent control is not the answer to protect renters
Shannon Grove - California State Senator (R-Bakersfield)
California needs to remove burdensome regulations and fees and make it easier to build more homes and apartments. Onerous legislation such as Assembly Bill 1482 will only slow future housing construction in California. Known as an expansion of rent control, AB 1482 is at odds with the overwhelming amount of research which strongly shows that rent control policies cause a decrease on housing supply. Voters recognize this and have already spoken on rent control. In 2018, Prop. 10 known as the Rent Regulation Measure, failed at the ballot box.
Renters are displaced when they are unable to afford rent. High rents are caused by high demand for a scarce supply of apartments. The solution is more apartments, which reduces rents. It shouldn’t take up to $100,000 in permits and fees before builders put their first nail in a 2x4.
We have an affordability issue that causes displacement. Around 25% of the nation’s homeless population is in our state. More than 50% of Californians are considering fleeing the state and the misguided policies of the majority party make these problems worse.
“We should always strive to create pathways to homeownership”
Rob Lapsley - President of the California Business Roundtable
California’s housing crisis affects every aspect of our state, particularly for our state’s most vulnerable residents. AB 1482 (Chiu, Grayson), which was recently passed by the Legislature and awaits the governor’s signature, is a critical first step in helping keep at-risk residents in their homes. It provides certainty to renters by capping rent increases to regional CPI plus 5 percent and includes important protections against unlawful and unjust evictions. Renters who are doing the right thing should have security and predictability in their housing future. AB 1482 is a balanced solution; it ensures continued investment in the multifamily housing supply. It is now time to turn our attention to single family homes and pass major reforms to drastically increase new housing starts. Our ultimate goal shouldn’t be just keeping renters from being displaced; we should always strive to create pathways to homeownership, which is the fastest and most effective way to build generational wealth.
Stabilize rents, preserve existing units and sign Assembly Bill 1482
Amanda Eaken - Director of Transportation and Climate for the Natural Resources Defense Council
All renters should be protected from excessive rent increases through local, regional and/or statewide rent stabilization. Governor Newsom has an opportunity on his desk to advance this goal by signing AB 1482 (Chiu). Local governments should not reward developments that displace existing households or demolish units occupied by, or affordable to lower income tenants. All renters should be protected from unwarranted eviction through a statewide ‘Just Cause’ law, and the Ellis Act should be reformed. These are three pillars of ClimatePlan’s Investment without Displacement platform that directly address protecting renters from displacement.
The only solution is making it easier to increase the housing supply
Dan Dunmoyer - President and CEO of the California Building Industry Association
Renters in California will be most protected when there is a sufficient increase to the state’s housing supply. Without the equilibrium that comes with a stable supply and demand model, renters will continue to face higher and higher rents and an uncertainty in their housing opportunities and choices. The supply and demand model will improve when cities allow for more home construction, when exorbitant home construction fees are reduced, and when the lengthy approval process to build is truly addressed and restructured.
Repeal California’s unfair Costa-Hawkins law
Catherine Lew - Co-Founder and Principal Consultant at The Lew Edwards Group
Imagine the horror of surviving the Holocaust only to be evicted from your home at 87 years old. This story of a disabled Alameda senior had a happy ending, thanks to community rallies and the fast work of the City Council to prevent the eviction from occurring. But there are millions of Californians we can’t protect from unfair evictions and massive rent hikes without meaningful, institutionalized reform. Tenant protections are essential in a state with poverty rates above the national average, three hour commutes, and teachers sleeping in their cars. That’s why Governor Newsom has promised to sign California’s Tenant Protection Act into law to implement a rent cap and new eviction protections. But over the long term, this human crisis requires repealing a disastrous law still on the books called the Costa – Hawkins Rental Housing Act. Under Costa-Hawkins, if a tenant leaves or is evicted, the landlord can raise the rent as high as they want. Making sure we have housing affordable for our workforce and future generations – and protecting our renters – is not only the right thing to do, but protects quality of life for all, and California’s economy. #HousingIsAHumanRight #HelpOurTeachersandWorkers
“Incentivize the development of new housing stock”
Jon Coupal - President of the Howard Jarvis Taxpayers Association
The best way to protect renters from being displaced is to incentivize the development of new housing stock. Greater supply means that those seeking apartments will enjoy a “buyers’ market” and landlords will have a greater incentive to limit rent increases and to maintain the habitability of their properties. But another remedy, often overlooked, is to increase the renters credit. The current renters credit is a paltry $60 ($120 if married/RDP) with strict income limitations. Increasing both the current renters credit and homeowners exemption (which hasn’t been increased since 1972) would be extraordinarily helpful in, not only alleviating California’s current housing crisis, but also providing middle-class tax relief in America’s most heavily taxed state.
“We need more California cities to become ‘pro-housing’”
Tia Boatman Patterson - Senior Housing Adviser for the Newsom Administration
We need more California cities to become “pro-housing” and build more housing units with every segment of their population in mind. Approving luxury multifamily units in areas where housing is most needed puts low- and moderate-income renters in danger of displacement.
Governor Gavin Newsom has included $250 million in his 2019-20 California For All state budget to jumpstart the critical planning and zoning that will help cities become “pro-housing” cities. There are also planning grants from Senate Bill 2 funds that are available through the Department of Housing and Community Development.
The need is critical and it is vital that we build more housing, while also being mindful that we are not displacing our state’s most vulnerable residents.
“Too many of our families simply cannot afford higher rent prices”
Carolyn Coleman - Executive Director of the League of California Cities
California’s cities are working hard every day to ensure that quality housing options exist for residents across the income spectrum, regardless of whether the home is occupied by a renter or someone who pays a mortgage.
As market forces spur new development or redevelopment of existing housing stock with presumably higher market values or returns, our renters are feeling the pressure as rental costs increase, exacerbating their risk of being displaced.
Too many of our families simply cannot afford higher rent prices, as more than 3 million California renters already pay more than 30 percent of their income for housing and over 1.7 million severely rent burdened Californians pay more than 50 percent of their income on housing.
One of the best ways to protect our families is to increase the supply of affordable rental housing as determined by locally driven and state approved land use plans. And one of the best ways to increase affordable rental housing now is for the Governor to sign SB 5. SB 5 creates a long-term partnership between local and state governments, providing much needed funding to spur affordable housing construction across the state with an on-going investment of up to $2 billion annually over time.
“We must address the housing shortage”
Jennifer Svec - Legislative Advocate for the California Association of Realtors
No more band aids – California needs to address the problem; not the symptom California’s renters deserve more affordable housing and more housing certainty. The state is suffering from a lack of supply which creates increased demand and pushes the price of both for sale and for rent housing out of reach for many families. False onerous market controls, like rent control or rent caps, are merely band aids to a complex market deficiency created by both state and local anti-growth advocates, who advance policies to discourage new development. REALTORS® see the catastrophic impacts of the housing crisis firsthand every day and understand that only meaningful, long-term solutions will protect renters from displacement. The rate at which cities and counties are approving housing permits is down more than 15 percent during the first half of 2019 compared with the first half of last year. Even worse, apartment development is down 42 percent from last year. We must address the housing shortage with policies that will actually lead to more housing and not by enacting more polices that simply serve to mask the problem.
Build more rental units, limit unreasonable rent increases
Jim Boren - Executive Director of the Institute for Media and Public Trust at Fresno State
We need thoughtful renter protections that are sustainable. However, until we increase the stock of affordable housing units to meet the demand, the cost of rentals will continue to rise and put vulnerable renters on the street. As with every California challenge, the issues are complicated. But they can be resolved if all parties come to the table with a willingness to solve the problem. Here are a couple of ideas. We must reduce government regulations that make building housing more costly, and we must revise laws that prevent us from putting reasonable caps on rent increases.
“Renters are being priced out of their homes”
Richard Bloom - California State Assemblyman (D-Santa Monica)
Renters are being priced out of their homes. We’ve seen this in communities all over the state, where rents are continually increasing and are unsustainable for our state’s poor, seniors and moderate income families. Inevitably, this is causing large scale displacement that includes a bourgeoning homeless population. The most recent homeless counts found a direct correlation between increasing homelessness and out of control rents.
Teachers, grocery store workers, car mechanics, and nurses – people who we interact with each and every day – many of whom have lived and worked in our communities their entire lives and who make up the fabric of our communities, are being displaced from their homes and neighborhoods. Renters who paid 20, 25 or 30% of their income on housing just a decade ago, today are paying 50, 60, or 70 per cent of their income just so they can keep the eviction notice off their front door and stay in the community they call home.
High rents also hurt job growth. Just look at the companies that have left California due to rising housing costs and the fact that their employees can’t afford to live near their jobs. Those that stay see a commuter workforce and not a local workforce – adding to our air quality and carbon woes caused by pollution from cars.
Millions of Californians are barely able to get by each month. This economic insecurity leads to stress at home as working families face impossible decisions. “Shall I forgo replacing worn tires or buying school supplies?” For some, it means having the electricity turned off or going a month without important medications. For others, it means going without healthy food.
Long term, dramatically adding to our housing supply is essential to driving down housing cost increases. Much has been done to address how we can increase supply and there remains more to do. But, increasing supply in the future is of little consequence to a tenant facing an unaffordable rent increase today.
For this reason we need to be looking at policies and investments that can help keep distressed tenants (and homeowners) in their homes. There are things we can do and programs we can adopt that will be helpful. For example, we should be investing in renter assistance programs, particularly for those who are a paycheck away from landing on the street. As well, people who are being unfairly evicted from their homes should have access to legal help just like landlords do. And, creative legislation can help. AB 1482, Assemblymember David Chiu’s bill creating a statewide “rent cap” will prevent excessive rent increases in many cases. My 2019 legislation reforming the Ellis Act will stop some particularly egregious evictions in rent control jurisdictions. Speaking of rent control, the numerous California jurisdictions with ordinances continue to be a bastion against rapidly increasing rents. Attempts to roll back those laws will only add to the affordability crisis and must be rejected. And new jurisdictions that decide that rent control is right for them should be allowed to do so, in a manner that does not hamper new housing construction.
A recent report commissioned by non profit, bipartisan California Forward indicates that, even if we move aggressively to build new affordable and market rate housing, it may take until 2050 before we have sufficient supply to curb the affordability crisis. Whether this, or more optimistic time frames prove accurate, we must implement policies that protect tenants and homeowners from spiraling costs, in order to curb the crisis of displacement, diminished quality of life and, ultimately, homelessness.