06-2020 CalRHA Legislative Update

COVID-19 Impacts

As the state continues to grapple with the impacts of COVID-19 the Assembly and the Senate have continued their work in Sacramento, albeit in an unorthodox fashion. Given that the pandemic forced the Legislature to take an unexpected recess in March and April, the Legislative calendar had to be revised. This pushed the regular summer recess back until June 19th for the Assembly and July 2nd for the Senate. Both houses were scheduled to return to Sacramento on July 13th, but even that had to be adjusted.

Two members of the Assembly (Assemblymember Autumn Burke of Marina del Rey, and Assemblymember Tom Lackey of Palmdale) tested positive for COVID-19, along with 6 staff members of the Assembly. Because of this, Assembly and Senate leadership have pushed back the date for Legislators to return to Sacramento to July 27th, and even that is considered by most to be a ‘soft date’. Both the Assembly and the Senate have a number of bills that they must dispense with prior to the Constitutional deadline which requires the Legislature to adjourn for this session on August 31st. There is a high likelihood that the Legislature and the Governor will work to call a special session to address some of the state’s most pressing issues that are not able to be resolved in this truncated session.

While it remains uncertain at which point the Legislature will officially resume, work in Sacramento has not stopped. Members continue to negotiate and amend their bills which they expect to be heard upon return. CalRHA has remained heavily involved in a number of different bills, most notably we have lobbied against AB 828 (Ting) on temporary moratorium of foreclosures, AB 1436 (Chiu) mandatory rent repayment schedule, and SB 1410 (Caballero) on COVID19 emergency tenancy relief which contains provisions that would harm property owners. Also, several proposals on housing have been amended. One bill that was recently amended is AB 1703, authored by Assemblyman Richard Bloom. This bill would impose a statewide right of first-refusal (ROFR) mandate on rental property owners. CalRHA has argued that this bill will result in in less development because investors will not have a clear path to exit their investment. We have taken an oppose position on this bill.

Another bill that is still active is Senator Durazo’s SB 1190. This bill authorizes tenants to terminate a lease in the event that they or an immediate family member are a victim of a crime. In May, there were provisions added to the bill that included significant expansion of the Tenant Protection Act of 2019 (AB 1482 from last year). CalRHA strongly opposed the addition of these enforcement provisions, and this provision was recently removed from the bill. CalRHA remains in opposition to the bill, however, we are glad to report that the enforcement provisions of AB 1482 have been removed.
 
The Legislature and the Governor have also been given the tall task of striking a balanced budget in light of the COVID-19 pandemic. The state faces a projected $54.3 billion deficit due to the pandemic induced recession, which prompted Governor Newsom to include significant cuts in his May Revision of the budget. Legislators rejected these cuts and instead implemented proposed trigger “solutions” which anticipate that the federal government will provide an additional $14 billion in stimulus funds. While the Legislature and the Governor have struck an agreement on this year’s budget, it is clear that additional adjustments will have to be made between now and the end of session as the state obtains greater clarity on their revenue. We expect a number of cleanup bills called budget trailer bills to be introduced which will aid in the implementation of this year’s budget.

It is obvious that COVID-19 has shuttered the way we conduct daily life and that the state’s response will continue to take necessary precautions to reduce infections. From mandatory mask orders, to shutting down indoor operations, virtually all sectors of the state have been affected by this. Even the Legislature has been impacted. We expect that the Legislature and Governor will continue to work to find solutions to this pandemic along with the state’s most pressing issues. While COVID-19 has taken center stage, other issues such as the state’s housing crisis are still high profile and garner much attention in Sacramento. We will continue to monitor and engage on these issues to provide thoughtful solutions that increase housing supply and protect property owners in California.

 — Chris Zgraggen