David Chiu

Assemblymember David Chiu

A bill to repeal California’s longstanding ban on rent control received little fanfare—until it died a slow death in committee. Can activists bring it back next year? 

Assemblymember David Chiu has been hailed as a hero on housing. His efforts to pass an ambitious spending and reform package with other Bay Area politicians landed him a glowing spread feature in San Francisco Magazine, and the accolades of newspapers across the state.

But one white whale remained in his agenda: bringing back rent control. In this ongoing saga, Chiu might make history as the only California politician to be picketed at his office by supporters of a bill that he supported as a coauthor.

Currently, the Costa-Hawkins Rental Act of 1995 bans rent control from applying to any new construction or single-family dwellings. Existing municipal rent control laws can only apply to apartment dwellings built before its enactment.

Assembly Bill 1506, authored by his Santa Monica colleague Richard Bloom, languished in the Assembly this summer without ever coming to a vote. Spanning scarcely a paragraph in length, the bill would very simply repeal the Costa-Hawkins Acts, potentially opening the floodgates for new rent control measures all over California. Insiders in the State Capitol reported that legislators’ offices were deluged with letters and phone calls from small property owners who were livid at the possibility of their cities limiting their price increases.

“Tenants in California are facing unprecedented hardships, which is why I signed on to be a co-author of AB 1506,” Chiu said in an emailed statement.  “I look forward to supporting AB 1506 in the Assembly Housing and Community Development Committee.”

At the same time, a statewide ballot measure to repeal Costa-Hawkins was being floated, with the provision to allow for a “fair right of return” for landlords. The ballot measure was officially filed with the Secretary of State in October.

“I think we’re seeing this as a two-hit punch for Costa-Hawkins repeal,” said Brad Hirn, lead organizer at the Housing Rights Committee in San Francisco. If AB 1506 failed to pass, he added, “We’re envisioning the second punch as the ballot measure.”

With momentum for the ballot measure growing, and the bill tabled until the next year’s legislative session, Sacramento politics observers were startled to see Assemblymember Chiu’s office swarmed with phone-banking campaigns, passive-aggressive social media campaigns, and even protests at his San Francisco office. A broad coalition of activists contended that Chiu, as chair of the Housing and Transportation Committee, needed pressure to schedule a vote for the bill. Otherwise, he was seen as “waffling” on a bill that had his name attached to it.

There was just one problem: only Assemblymember Bloom could actually call for a vote.

“[Chiu] has a lot of power to bring this to a vote in the committee,” Hirn said. “We’ve seen him act with great urgency on other bills…but we haven’t seen his office release single press release or a single media event…so we’re just looking for him to treat this bill as a priority.” Activists even posted a symbolic eviction notice on the door of his office.

A Sacramento insider, speaking on background, saw little sense in this strategy: “I don't know who is telling them that the chair of a committee can just schedule another member's bill in a committee just because they are the chair,” the anonymous source insisted. “There are plenty of bills I am sure [Chiu] would love to vote on that end up dying/sitting in his committee, but he has to respect the authors' decision to bring them up for a vote or not. “

While that doesn’t seem to have been lost on tenant advocates, the media spectacle proved much more effective when directed at the author, Assemblymember Bloom. Within hours of public calls on social media for Bloom to call a vote, both Chiu and cosponsor Rob Bonta (D – Alameda) announced that AB 1506 would be heard in committee on January 10th.

Whether the effort was shrewd strategy or spectacle was ultimately irrelevant: after all, it worked.

Some recent efforts to strengthen rent control in California have fallen flat, enduring criticisms of “overreach” and scaring off even progressive politicians who fear a backlash from property owning constituents at the polls. Measure M1, a ballot initiative in Alameda sponsored by the Alameda Renters Coalition, was considered too extreme even by veteran East Bay journalist Robert Gammon, who himself advocated for a repeal of the Costa-Hawkins Act. Capping price increases at 65% of the Consumer Price Index (CPI) was an effort to bring San Francisco’s progressive policies from the ‘70s into the far-flung, largely residential suburb. But with vulnerable Alameda renters outgunned by lobbying from the powerful California Apartment Association, it simply couldn’t gain political steam in this century.

Assemblymember Rob Bonta, another Democrat cosponsoring AB 1506, also hails from Alameda’s progressive political wing. His willingness to risk political disfavor suggests there is a middle ground between the Costa-Hawkins status quo and 1970s idealism. And it would be too simplistic to paint this as moderate centrism.

To announce the scheduled vote, Bonta tweeted:

Rob Bonta Tweet

One overarching concern is that rent control can suppress housing construction and disincentivizes upkeep by limiting returns on investment, thereby making housing more expensive, on average, for everybody. Rent control is great when you already have a place; it doesn’t help you with housing security when you’re looking to move. In practical terms, however, it’s unlikely that modern rent stabilization would have an appreciable effect on the supply of available homes.

“When we looked at housing production numbers from 2007 to 2013, the six cities that had rent control in the Bay Area actually produced more housing units per capita than cities without rent control,” Miriam Zuk, a scholar at UC Berkeley’s Urban Displacement Center, concluded in 2015.

In other words, residents benefit from housing stability more than such a market intervention could harm them. Furthermore, some supporters of AB 1506 suggested legalizing rent control on residences on a scale of 10-20 years after construction. Since development financing typically doesn’t hinge on returns after that period of time, this implementation could, in theory, eliminate all concerns about housing supply being limited.

Even sympathetic scholars are still careful to avoid promoting rent control as a silver bullet. A decade prior, Zuk’s Berkeley colleague Karen Chapple found that housing markets in cities like New York and San Francisco, prone to tech sector booms with volatile labor demands, behaved much differently than in cities like Minneapolis. Chapple recommended “that policy approaches aimed at stabilizing local housing markets would need to be tailored to the specific demands of each region.” Her view, that incentivizing the construction of affordable housing with tax credits and density bonus was better suited for high-demand cities, did not become popular in California until very recently. It’s clear from Zuk’s research, however, that rent control in Bay Area cities did not inhibit these strategies.

So while the policy remains complex, the overarching principle is simple: people should be able to stay in their homes. And it’s not obvious a priori that a predictable price cap is any more or less fair of a way to achieve that, instead of, say, a fixed percentage of one’s income (which is how subsidized affordable housing is usually distributed in San Francisco).

Rent control is just one thorny piece of the puzzle in California’s crippling housing crisis. On January 10th, however, activists and politicians may finally converge to address it.

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