Californians are voting on a number of propositions that deal with a wide variety of issues this election season. Here’s a closer look at Proposition 21, which deals with rent control. This is a summary of information taken from the official California voters guide and the helpful web site Ballotpedia.
Prop 21: Expands Local Governments’ Authority to Enact Rent Control on Residential Property
Allows local governments to enact rent control on housing that was first occupied over 15 years ago, with an exception for landlords who own no more than two homes with distinct titles or subdivided interests.
This ballot measure would replace the Costa-Hawkins Rental Housing Act, which was passed in 1995. Prior to the enactment of Costa-Hawkins, local governments were permitted to enact rent control, provided that landlords would receive just and reasonable returns on their rental properties.
Costa-Hawkins continued to allow local governments to use rent control, except on, (a) housing that was first occupied after February 1, 1995 and, (b) housing units with distinct titles, such as condos, townhouses, and single-family homes.
Under Costa-Hawkins, landlords are allowed to increase rent prices to market rates when a tenant moves out, a policy known as vacancy decontrol. This ballot measure would require local governments that adopt rent control to allow landlords to increase rental rates by 15% during the first 3 years following a vacancy.
Arguments in Favor
Prop 21 would keep families in their homes, preserve affordable housing, stop homelessness, and save taxpayers money.
The housing crisis rages on as rising rents and stagnant wages leave many behind. The consequences are felt by everyone. Neighbors are forced from communities, renters face uncertainty, and the most vulnerable people end up on the streets. Small businesses are squeezed as renters spend less in their communities and workers face longer commutes.
Living paycheck to paycheck makes it difficult for teachers, grocery clerks, and nurses to afford housing in the communities they serve, while still having enough money for basics like groceries, gas, and childcare. And skyrocketing rents have led to over 150,000 homeless people living on the streets.
The crisis is only getting worse. The coronavirus pandemic has left millions of workers unemployed and at risk of losing their homes. According to a UCLA study, we are facing a surge in homelessness.
A 2017 study found that just a 5% increase in rent pushes 2,000 Los Angeles residents into homelessness. The burden of rising homelessness in California is paid for by taxpayers. The cost of homelessness, estimated at $35,000 to $45,000 annually per homeless person, is unsustainable. Prop. 21 ensures that fewer people lose their homes, saving taxpayers money.
Prop 21 exempts single-family homeowners. If you are not in the rental home business, you will not be affected by Prop 21.
Prop 21 is a deeply flawed scheme that will increase housing costs and hurt California’s economic recovery.
Prop 21 does nothing to address California’s housing shortage. Instead, it undermines the strongest statewide rent control law in the nation signed by Gov. Newsom and enacted just last year with no plan to build affordable and middle-class housing or deal with the increasing problem of homelessness on our streets.
Prop 21 has no protections for seniors, veterans, or the disabled, and it has no provision to reduce rents.
Prop 21 allows local governments to establish extreme and permanent regulations on nearly all aspects of housing. For example, even after a tenant moves out, property owners won’t be able to establish rents at market rates or pay for investments in repairs or upgrades. It simply goes too far.
Californians are experiencing a severe housing affordability crisis in the most devastating economic and public health emergency of our lifetimes. The last thing we should do is pass an initiative that will stop new housing from being built, cost jobs, and hurt the economic recovery.
Groups supporting Prop 21 include:
• California Democratic Party
• California Nurses Association
• SEIU California State Council
• ACLU of Southern California
• AIDS Healthcare Foundation
• Eviction Defense Network
• Los Angeles Tenants Union
Top donors to “Yes on 21”:
• AIDS Healthcare Foundation ($23,938,568)
• California Nurses Association ($25,000)
Groups opposed to Prop 21 include:
• Republican Party of California
• Equity Residential
• Essex Property Trust, Inc.
• Invitation Homes
• Prometheus Real Estate Group, Inc.
• American Legion, Department of California
• California Taxpayers Association
• Howard Jarvis Taxpayers Association
Top 5 donors to “No on 21”:
• Essex Property Trust, Inc., and Affiliated Entities ($6,600,000)
• California Business Roundtable Issues PAC ($5,600,000)
• Equity Residential ($5,541,940)
• Avalonbay Communities, Inc. ($4,394,250)
• Jackson Square Properties LLC ($1,567,980)