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Rents soared 151%. Under California’s new law, tenants are getting a refund

In 2019, Gov. Gavin Newsom signed a law to shield California renters from double-digit rent hikes and arbitrary evictions.

Nearly four years later, the state announced its first enforcement action against a landlord under the California rent control law.

Attorney General Rob Bonta today announced that San Jose-based developer and property manager Green Valley Corporation will be on the hook for hiking the rent on 20 Silicon Valley tenants by an average of 151% — far in excess of the cap set by the law. The settlement also states that the company unlawfully evicted six tenants without providing a “just cause,” another violation.

“When the Legislature writes a law and the governor signs it, it’s the law, it’s not a suggestion, it’s not a recommendation, it’s not a ‘if you want to,’” said Bonta.

California rent relief is still available for thousands of tenants who were denied COVID assistance

More than 100,000 California tenants whose applications for COVID-era rental assistance were denied or delayed by the state’s housing department will get another shot at relief, thanks to a new legal settlement between the state and a coalition of anti-poverty and tenant rights groups.

More aid isn’t guaranteed. But under the terms of the settlement signed at the end of last month, California’s Housing and Community Development Department agreed to audit its past denials and improve multilingual access for tenants who don’t speak English as a first language.

It also agreed to flesh out the appeal process for applicants and provide more detailed explanations when it denies an application. And it committed to providing more data on the race, ethnicity and location of those who were denied help.

California’s housing department received $5.2 billion in federal relief funds in 2021 to help struggling tenants keep up with rent while the state’s economy ground to a halt during the height of the pandemic. The program ended in March 2022.

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Advocates push for state amendment to make housing a ‘human right’

Should the state guarantee a right to housing for all Californians?

A coalition of anti-poverty advocates led by Matt Haney, a Democratic state assemblymember from San Francisco, is proposing an amendment to the state constitution that seeks to do just that.

The amendment does not define a right to housing, and backers have offered few specifics about what it would mean in practice. But they say it could make it easier for state officials to sue local governments that resist adding significantly more affordable homes. To pass, it needs a two-thirds majority in the state Legislature and then approval by voters.

At a news conference in Sacramento this week, Haney, alongside leaders from advocacy groups including the ACLU of California and Alliance of Californians for Community Empowerment, touted the amendment as a long-awaited solution to the state’s affordable housing shortage.

“This is a crisis, and the status quo approach that doesn’t recognize (housing) as a fundamental human right is not going to get us there,” said Haney, a newly elected lawmaker who campaigned on bolstering affordable housing.

Past efforts to codify a right to housing in the state constitution have failed in recent years. And it remains unclear if the latest amendment can muster enough support this time around. But if successful, advocates say it would be the first of its kind anywhere in the country.

For decades, the state and Bay Area haven’t come close to building enough affordably priced homes for everyone who needs them. That’s in part due to a lack of funding for low-income housing. But many cities — from metropolitan San Francisco to suburban Pleasanton — have also long resisted planning for growth.

Experts agree that underproduction is at the root of California’s astronomical housing costs, which are putting an increasing strain on many residents and exacerbating the state’s homelessness crisis.

More than half of all California renters spend over 30% of their earnings on housing, classifying them as “rent-burdened” by federal standards. And many pay much more than that. The state’s homeless population, meanwhile, has grown to over 170,000 people amid the economic fallout of the pandemic, spiking by at least 20% in Contra Costa, Alameda and San Mateo counties.

 

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CA lawmakers consider ending disaster price-gouging protections as high prices squeeze Californians

In the last several years, California has experienced devastating wildfires, extreme drought, a deadly pandemic, and the worst methane leak in U.S. history, among other emergencies. Unfortunately, some California landlords see opportunity in disaster. For example, after the 2015 methane leak in Aliso Canyon, landlords charged victims up to $9000 for temporary shelter. After the 2017 North Bay fires, landlords increased rents for victims by up to 36%.

Disasters aren’t new for California, but against the state’s worsening housing crisis, the importance of accessible, stable housing after disaster is clear.

The passage of AB 2820 and AB 1919 in California was meant to stop blatantly predatory conduct after disaster and strengthen protections for victims of price gouging in emergencies. Now, a few years and natural disasters later, those protections are under attack via a bill currently moving through the state legislature, SB 1133 (Archuleta). SB 1133 will undo decades of price gouging protections for Californians at a time when the state is reeling from both natural and man-made disasters and gives a green light to unscrupulous landlords to prey upon victims of emergencies by increasing rents above the allowable 10% during declarations of emergency. California can’t afford for SB 1133 to become law.

SB 1133 seeks to eliminate housing from the anti-price gouging protections in Penal Code Section 396, which is a provision of law used by advocates across the state to prevent excessive rent increases for disaster victims. When I was a tenant attorney in Los Angeles, I once relied on those anti-price gouging protections for housing to prevent unjustified and excessive rent increases for a building full of elders after a corporate landlord purchased their building. When the building sold, the new owner quickly increased rents by over 60% for everyone there, many of whom were disabled elders and all of whom already spent between 30%-40% of their limited fixed incomes on rent. The rent increases would have forced them out of their homes — the only law that kept them housed was the anti-price gouging protections for housing in PC Section 396.

Proponents of SB 1133 claim that businesses are unfairly subject to unjust punishment because of PC Section 396. However, landlords who price gouge are hardly prosecuted under this section. For example, landlords increased rent by up to 36% after the 2017 North Bay fires, which scorched more than 200,000 acres of land and forced 90,000 people to evacuate their homes. Even though the Sonoma County District attorney’s office investigated over 220 complaints of price gouging, they only filed four criminal cases against the most egregious actors, and the Attorney General only filed one criminal case. Meanwhile, people were forced to live among the toxic smoke of their burnt homes because they couldn’t afford a home to rent. SB 1133 isn’t about addressing unjust prosecution; it’s about money and creating opportunity for profit, even when the opportunity is people in need of housing after they’ve lost theirs.

Additionally, the bill’s sponsor (the California Apartment Association, a landlord lobbying group) and author say SB 1133 is necessary to increase transparency for businesses that get confused about compliance during a declaration of emergency, even though businesses have resources available at the local and state levels to determine if a proclamation of emergency is in effect. SB 1133 is not about ensuring businesses are less “confused” about emergency proclamations – that’s already in the law.

We know surviving a disaster adversely impacts individuals and communities. Studies show that long after disaster, individuals experience post-traumatic stress due to housing loss, increased health conditions like stroke, heart disease, and lifelong chronic illnesses, and increased homelessness – all of which disproportionately impact people of color.  These individual impacts coalesce to impact whole communities.

The devastating community impact after the 2018 Camp Fire — the most destructive in California history — is still felt today. The Camp Fire displaced over 80% of Paradise’s population and destroyed 90% of housing. Consequently, people were forced into neighboring communities like Chico that didn’t have the capacity to house them. At that moment, some Chico landlords increased rents by 15%, creating an immoral bidding war among survivors who were sleeping in garages, tents, and shelters. Years after the Camp Fire, communities in Paradise and the surrounding areas have seen increased housing instability and homelessness. If passed, SB1133 would allow corporations and unscrupulous landlords to capitalize on the needs of people like those who survived the Camp Fire when they are trying to survive.

You might think a bill with this much impact would receive special consideration by legislators – particularly those representing districts with victims of past and future disaster. Not only was there very little discussion about the devastating yet highly predictable potential impacts of SB 1133, the bill also passed out of its legislative policy committee with a majority vote.

But the legislature is still in session, and there is time to stop the bill. SB 1133 is currently in the California Assembly’s Appropriations Committee awaiting an August hearing date, where we will demand elected representatives vote against greed and protect displaced Californians.

Help stop price gouging after disaster. Call your state legislator and demand a NO vote on SB 1133.