California Legislature Will Act on Three Key Issues Affecting Landlords Within the Next Few Days

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Price Control on New Rental and Ownership Housing

Senate scheduled to vote on AB 1229 at press time.

If you thought residential rent control limited your bottom line, you are not going to like AB 1229 (Atkins).

AB 1229 allows local governments to mandate "inclusionary housing" laws (requirements on private property owners to set aside a percentage of new housing for low-income rental for periods of at least 30-55 years) without allowing owners to set initial or subsequent rental rates or requiring local government to provide owners with vital cost offsets that would allow owners to recover, at the very least, operational and repair costs. It also abrogates the Palmer v. City of Los Angeles decision, which upheld an important provision of the long-standing Costa-Hawkins Rental Housing Act exempt ing newly constructed rental units from price controls.

If a ban on setting the initial and all subsequent rental rates was not bad enough, the bill will also not let you recover your operating costs or capital improvement costs!

The bill will be voted on by the full Senate by September 12 and if approved, it will be placed on the Governor's desk for his signature.

Water Meters, Fixing Water Fixtures and Mandatory Water Fixture Retrofit Bill

SB 750 (Wolk) is one of the most comprehensive water bills affecting all residential properties in years.

The bill is to encourage water conservation in multifamily residential rental buildings. It proposes to do so by requiring all newly constructed units to be sub metered and to apply new sub meter regulations and billing requirements, new billing disclosures, substantial enforcement tools and new remedies to tenants if a landlord does not fix any water-related problem within ten (10) days or retrofit all fixtures for pre-1994 buildings with new water conservation fixtures by 1/1/19. Consequences for not following the new terms of the bill are severe. Landlords that do not make repairs within 10 days, regardless of the reason, will permit a tenant to recover one month's rent plus all attorney fees and costs.

The bill will be considered by the Assembly Water Committee in August. The California Apartment Association dropped their opposition to the measure while we remain opposed.

Proposition 65 Warnings Proposed by the Administration

The Brown Administration is proposing a comprehensive reform to Proposition 65 warning signs. Of the entire real estate industry, our Association, Apartment Association, California Southern Cities, Orange County Apartment Association and Nor Cal Rental Property Association are represented at an invitation-only Governor's ad hoc working group.

At issue for us is the Administration wants to change the content and placement of all Proposition 65 signs. The new language that is being seriously considered states that the public will be exposed to chemicals located on the property, there would be different signs all throughout the property (a special parking lot sign, another sign for laundry rooms, yet another for each area that may contain Proposition 65 chemicals), and each sign would be required to provide complete information about all of the chemicals.

A coalition of business, public interest and environmental groups serve on the Governor's ad hoc group and we continue to provide information and objections to implementation of proposed changes in Proposition 65 that would become impractical and a litigation dream come true for litigants.

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333 W. Broadway St., Suite 101
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(562) 426-8341

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