Legislative Update

By Scott Dick, Ed.D.

(Excerpted from car.org): Friday, June 1, 2018 was the Legislature’s “House of Origin” deadline. Any measure that did not pass over to the other house by that date will not move forward this session.

Here are a few highlights from last week, as the Legislature moves closer to summer:

Defeated: AB 2364 (Bloom and Chiu) Ellis Act
 – Enacted by the Legislature in 1985, and sponsored by C.A.R., the Ellis Act prohibits local government agencies from forcing property owners to continue to operate their private properties as rental businesses when they wish to stop doing so. Specifically, the Ellis Act, among other things, requires properties returned to the rental market before a 5 year “seasoning” period expires to include any deed-restricted or rent-controlled units previously located on the property. C.A.R. opposed AB 2364: it would effectively double that “seasoning” time period from 5 to 10 years. This, in turn, would have made it less likely that properties would be returned to the rental market, further aggravating California’s rental housing supply problems.

AB 2364 was defeated on the Assembly Floor thanks to the efforts of REALTORS® who responded to a C.A.R. Red Alert. The bill secured only 25 YES votes with 36 Assembly Members voting NO and the remainder not voting.

Defeated: AB 2925 (Bonta) Just Cause 
– Existing law allows landlords to provide a 30- or 60-day notice to a tenant without stating a reason for the termination of the tenancy. This bill would have prohibited a landlord from providing this notice unless the landlord had “just cause” and enumerated the reasons for termination in the notice.C.A.R. opposed AB 2925: it would have put good tenants in danger by making it extremely difficult to remove bad tenants who engage in behavior that violates the terms of their lease. AB 2925 was defeated on the Assembly Floor.

Tabled: AB 2618 (Bonta) Mandatory Property Management Certification Program – AB 2618 would have created a new property management certification program, and would have mandated all landlords and property managers who own or manage rental units to complete the program every two years. C.A.R. opposed AB 2618: it would have required real estate licensees to complete a mandatory property management certification program to perform property management services that they are already licensed to provide.

Thanks to the efforts of REALTORS® on Legislative Day, AB 2618 was held in the Assembly Appropriations Committee and will not move forward this session.

Moving forward: AB 2368 (Calderon) California Online Notary Act – Current law requires that specified documents related to a transaction be notarized in person. AB 2368 requires the Secretary of State to adopt standards that authorize the online notarization of documents. C.A.R. supports AB 2368: it seeks to improve and update the home purchasing process by making document notarization more convenient while providing necessary safeguards. AB 2368 passed off the Assembly Floor this past week.

Moving forward: AB 2890 (Ting) Accessory Dwelling Units (ADUs) 
– This measure seeks to prohibit local ordinances from adopting restrictive requirements (i.e. minimum lot size, lot coverage, or floor area ratio) on the construction of ADUs. The bill reduces the timeframe in which local governments must approve or disapprove an ADU to 60 days. Finally, this measure gives the Department of Housing and Community Development review and oversight authority over local ADU ordinances. C.A.R. supports AB 2890: it will help alleviate our housing shortage by streamlining the statewide development of accessory dwelling units. AB 2890 passed off the Assembly Floor last week.

Moving forward: SB 1087 (Roth) PACE: Program Administrators – In 2017, the Legislature passed AB 1284 (Dababneh) which required the licensing and regulation of Property Assessed Clean Energy (PACE) program administrators and the solicitors and solicitor agents. Under these requirements, program administrators must be licensed by the Commissioner of Business Oversight. SB 1087 seeks to provide more clarity within the PACE program by implementing various substantive and technical changes including the following provisions: 1) establishing “good faith” determination of the borrower’s ability to pay, 2) improving safeguards on a consumer’s personal information by adding further specifications to the role of program administrators, 3) ensuring that DBO can take immediate action to discipline PACE solicitors and solicitor agents. C.A.R. supports SB 1087: it increases consumer protection with PACE transactions. SB 1087 passed off the Senate Floor this past week.