California rent control measures begin to take their first steps

Sophia Bollag, Associated Press

Update

23:36 PST, Tuesday 6 November 2018

SACRAMENTO, Calif. (AP) – A move to allow more control over rents in California was dragging on in early returns Tuesday.

Proposal 10 lost about 20 percentage points with more than 2.9 million votes counted.

The initiative that would allow cities to expand rent control has generated more than $ 100 million in campaign contributions, making it one of the most expensive and controversial elements of the vote because California is facing a housing shortage and an increase in rents.

Proposal 10 would cancel a state law prohibiting the control of rents on apartments built after 1995, single-family homes and condominiums. The same law also prevents cities and counties from telling homeowners what they can blame on new tenants.

More than a dozen California cities, including Los Angeles and San Francisco, already have some control over rents on their older properties. If adopted, proposal 10 would come into force later this year and give local governments more flexibility to adopt or expand rent control.

This would automatically restore an old Berkeley law that limits what homeowners can impose on new tenants in that city. Other cities are already discussing their own rent control proposals if they are passed.

Supporters say that a more effective rent control would prevent low-income people from leaving their homes. Opponents say that this would lower the value of real estate, further decreasing the supply of housing in the state by discouraging construction.

A survey released last month by California's non-political Public Policy Institute found that 60 percent of potential voters were considering voting against the measure, giving them long chances to prepare for polling day.

Proponents of Proposition 10 include the Democratic Party, California Teachers Association and Vermont Senator Bernie Sanders, a popular progressives. AIDS Healthcare Foundation, a non-profit organization based in Los Angeles, known for its support for controversial voting measures, contributed $ 23 million of the $ 25 million raised to implement this measure.

The two candidates for governorship oppose this initiative, as well as the NAACP conference in California and the California Chamber of Commerce. The bulk of the $ 75 million opposition campaign funding came from the real estate sector. The California Association of Realtors was the largest donor, followed by Essex Property Trust and investment firm Blackstone.

The office of the legislative analyst, non-partisan, said that the proposal 10 would reduce the value of rental properties. Economic studies generally show that rent control benefits some tenants, but generally limits supply and increases rents as it reduces incentives for construction.

The rate of homelessness in California is disproportionate and nearly a third of California renters spend more than half of their income on rent, according to the state housing agency.

Californians will also weigh two measures of obligation to provide more affordable housing.

Proposal 1 would allow $ 4 billion of general obligations for low-income housing and veterans housing, which would be repaid over time. He won by a small margin in the first returns with 52% of the votes in favor.

Proposal 2 would allocate $ 2 billion in bond financing to homeless people with mental illness. Legislators approved the bonds in 2016, providing for repayment with funds from a tax on millionaires approved by voters in 2004. But the funds were blocked in court due to a lawsuit who argues that voters approved the tax to fund mental health services, not housing. . The legislators and the governor decided to resolve the legal dispute by addressing the issue to the voters. He was a winner in first comebacks with 59 percent.

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