Earlier this year, three California Assemblymembers — Richard Bloom, David Chiu & Rob Bonta — took Sacramento by surprise, introducing AB 1506 to repeal the Costa Hawkins Rental Housing Act. Recent grassroots organizing by tenant groups laid the groundwork for this important legislation. Since 2015, numerous cities have been organizing for rent control, and in that time tenants in Richmond, San Jose, Union City, and Mountain View have already won new protections. There is a tenant movement gaining strength, and we have our eye on rolling back state restrictions that stand in the way of strong local rent control.
Costa Hawkins is the gift that keeps on giving for landlords and real estate speculators. It is probably the single biggest reason we face runaway rents in so many California cities. A special-interest state law backed by the real estate industry that passed in 1995, Costa-Hawkins ties the hands of cities when it comes to protecting tenants from landlords who charge exorbitant rents. Costa-Hawkins prohibits rent control on certain properties (post-1995 construction, single family homes, condos) and bans “vacancy control” (regulating the initial rent for a tenancy).
The authors of AB 1506 recently announced that their repeal legislation would be a two-year bill, meaning they will try to move it through the legislature in 2018. This was welcome news to tenant advocates who have always viewed 2018 as the start of our effort to repeal Costa Hawkins, giving us time to expand our coalition and train organizers and volunteers who have been mostly focused on local fights, to take on state-level legislation.
Though the legislative campaign for repeal of Costa Hawkins is only a few months in, it’s worth looking at what has happened so far. Five things stand out from Round One of the campaign to repeal Costa Hawkins:
First, there is widespread interest in repealing Costa Hawkins, far more than conventional wisdom in Sacramento would have you believe. The bill to repeal Costa Hawkins gathered substantial media attention, key co-authors, and galvanized tenants and allies. In the midst of an affordable housing crisis, many policymakers are no longer willing to ignore local solutions (especially cost-free solutions like rent control) just to keep exorbitant landlord profits flowing.
Despite landlord efforts to frame rent control as “controversial,” the reality is that it isn’t. Landlords oppose it, but they are a tiny fraction of the population. In fact, rent control is as popular as ever in CA, if not more so. Voters rejected the landlord attempt to abolish rent control (Prop. 98) statewide by a 22 point margin in 2008. The landslide tenant victory emboldened advocates to demand rent control and eviction protections locally in new jurisdictions. Two new cities have passed rent control in the last year (Richmond and Mountain View), two have passed just cause protections (Union City and San Jose), two more have rent control and just cause on the ballot in 2017 (Pacifica and Santa Rosa), and momentum is building in cities like San Diego, Glendale, Pasadena, and unincorporated LA County. In this climate, one-size-fits-all state laws limiting rent control are increasingly viewed with skepticism.
Second, the tenant movement is stronger than it has been in decades. Tenants are unified behind Costa Hawkins repeal and energized to make it happen. The talent and depth of the multi-racial, cross-class tenant rights movement is growing stronger by the day.
Tenants Together and allies recently convened over 125 tenant organizers from 40 organizations for California Renter Power 2017 in Los Angeles. A much larger renter assembly is planned for the fall in the Bay Area. The movement is comprised of veteran tenant advocates, new grassroots organizers and emerging leaders who are standing up to landlord money and winning. Meanwhile, ACCE, Tenants Together, and allies are leading a comprehensive Housing Now! campaign that is calling for stronger tenant protections and affordable housing, while challenging unbridled real estate speculation in California. With another year to organize, a growing tenant movement will continue putting the pieces in place to take on Costa Hawkins.
Third, politicians will only succeed on Costa Hawkins if they let tenants lead. None of the authors of AB 1506 consulted tenant organizations before introducing their bill. If they had, we would have told them to wait a year. We appreciate these legislators putting their names to a bill to repeal Costa Hawkins — they are on the right side of history — but they will only succeed if they let tenant advocates play a leading role in their effort, and use their offices to bring in other allies and swing key votes. We know the real estate industry talking points and how to rebut them, and we know how to mobilize tenants and allies, which are the key reasons we are winning locally. Legislators in Sacramento who want to take on Costa Hawkins need to work with tenant advocates every step of the way if they are serious about winning.
Fourth, the landlord lobby has power through their money, but not much else. The lack of a serious policy defense of Costa Hawkins has been striking. The real estate industry simply responded to AB 1506 with misinformation in a sloppy defense of their prized law. They predict disaster for landlords from Costa-Hawkins repeal, but ignore longstanding legal precedent that makes clear that any local rent regulations must provide a fair rate of return for landlords for the law to survive judicial scrutiny. Moreover, contrary to the industry scare tactics, Costa-Hawkins repeal would mandate nothing. It would leave these issues up to cities. Cities are fully capable of deciding for their particular population and housing stock what restrictions they choose to impose, if any.
The landlord lobby assumes that because they fund campaigns (and they’ve increased their campaign donations exponentially), they can say what they want in the Capitol and will have their way. Too often, that strategy works. As Matthew Desmond observed in a recent NY Times Magazine article:
“We often discuss the influence of the gun and pharmaceutical lobbies, but the real estate lobby has spent much more than either group. According to the Center for Responsive Politics, the National Association of Realtors spent $64.8 million in lobbying efforts in 2016, making it second only to the U.S. Chamber of Commerce in terms of dollars spent.”
Against this backdrop, we know that opposing landlords on the facts is not enough to win. We must build power at the local, regional, and state levels. Tenant groups must expose legislators who side with landlords against reasonable reforms. Beyond that, tenant groups that legally can, must utilize PACs, endorsements, and strategic partnerships to make sure legislators who betray tenants are defeated at the polls.
Fifth, any talk of compromise on Costa Hawkins is premature. Sacramento insiders love legislative sausage and compromise — water down legislation to the point where it does little to nothing and offends no moneyed interest, and then claim victory when the bill becomes law. In contrast, voters are looking for leadership, vision, and real solutions. Just weeks after Costa Hawkins repeal was introduced, there was pressure on legislators to start compromising, because, well, that’s just how it usually works in Sacramento. Tenants stood firm against compromises that would undermine fair policy. We will need to flood legislators with calls, letters, visits and direct action to stiffen their resolve. Like voters speaking up nationwide at town halls against threats to health care coverage, tenants plan to ramp up pressure on legislators to do the right thing to stop runaway rents.