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Costa-Hawkins Repeal Defeated in Legislature, Other Rent Regulation Measures Loom

The California state capitol

Entering 2018, rent regulation is an issue that several state legislatures are looking to take up this session. In California, Washington and Wisconsin legislators have begun deliberations on measures that could either seriously help or hinder the supply of affordable housing.

The California Assembly again considered legislation to repeal Costa-Hawkins, a law that prohibits the application of rent control on properties built after 1995, places limitations on local rent control ordinances by exempting single-family homes and new multifamily construction (post-1995) from any form of rent control and allows property owners to increase rent for new tenancies when a resident moves out. The bill, AB1506, was taken up by the Assembly Housing and Community Development Committee earlier this month, and after a testy hearing, the Committee voted 3-2 against the legislation. While this is a win for property owners in California, a ballot measure that seeks to repeal Costa-Hawkins is also in the works. If tenants’ rights organizers are able to gather 365,880 valid voter signatures within a six-month window, the measure will qualify for the 2018 ballot.

In Washington state, two proposals have been introduced pertaining to rent regulation. The bills, HB2583 and SB6400 would roll back a statute that precludes local governments from enacting rent control. At this time, the bills have not been scheduled for hearings in either the House Judiciary Committee or Senate Financial Institutions and Insurance Committee. While our affiliate, the Washington Multi-Family Housing Association, hopes to defeat these proposals this year, these bills pose a greater long term danger as there is uncertainty whether similar measures can be dispatched in future sessions.

Heading east to Wisconsin, companion omnibus bills have been introduced that include provisions pertaining to inclusionary zoning. The measures, SB640 and AB770 would prohibit a political subdivision in the state from imposing inclusionary zoning requirements for both multifamily and single-family housing. SB640 has received a public hearing in the Committee on Insurance, Housing and Trade but has not received a vote yet. As for AB770, that proposal also has received its first hearing and it has not been voted on yet by the Committee on Housing and Real Estate.

Since it is early in the year, policymakers are likely to continue considering rent regulation proposals; however, it appears for the time being that measures allowing for rent regulation are not gaining traction. That being said, it remains to be seen what will happen with some of the larger fights that apartment owners and operators face, such as the ballot measure in California.

If you are aware of a state bill or local proposal addressing rent regulations, please contact Robert Melvin, Manager of Government Affairs.