Manufactured Housing Alert
AB 1506, a bill that would have repealed the 1995 Costa-Hawkins Act failed to pass in the Assembly’s Housing and Community Development Committee yesterday. The Costa-Hawkins Act prescribes statewide limits on the application of local rent control with regard to certain properties. The bill read: “This bill would repeal that act.” The committee vote was 3 to 2 to let it die, with two Democrats abstaining. It needed four votes to move out of committee.
Costa-Hawkins, named for its sponsors, Sen. Jim Costa (D-Fresno) and Assemblymember Phil Hawkins (R-Bellflower), put a number of restrictions on a city’s ability to control rents. The rent control prohibition applies to single family dwellings, condominiums, or apartments built after 1995. Under Costa-Hawkins, landlords are allowed to reset the cost of a unit once a tenant voluntarily moves out.
Opponents of AB 1506, including landlords, argued the passing of the bill would stifle badly needed construction. The view common among economists and the committee members who opposed the bill is that more rent control is not the way to solve California's housing crisis. California manufactured housing community owners know this to be true.
The possibility of putting it on the November 2018 ballot exists, but it will cost millions of dollars to win this repeal, which tenant organizations do not have. If it garners the required 365,880 signatures, voters will have a chance to vote on the polarizing law in the November election.
Although Costa-Hawkins does not apply to mobile home parks, we know that many of our community owner clients and others also have investment interests in other forms of rental housing. It will be important to support all opposition efforts in the coming year.