C.A.R. is OPPOSING AB 2502 (Mullin), a bill that would weaken the rent control limitations contained in the landmark “Costa-Hawkins” law sponsored by C.A.R. in 1995. C.A.R. opposes AB 2502 which undermines existing Costa-Hawkins’ protections by allowing local governments to impose mandatory inclusionary zoning (i.e. rent control) on newly constructed rental housing, without any consideration for the economic viability of the project.
AB 2502 effectively repeals part of the C.A.R. sponsored Costa-Hawkins legislation that says new construction in a rent control jurisdiction is exempt, or NOT subject to rent control. It is vitally important that you reach out to your elected representative today!
Call your Assembly Member today at 1-800-798-6593
For Jim Wood, enter PIN number 8712 followed by the # sign
For Bill Dodd, enter PIN number 1886 followed by the # sign
Urge them to oppose AB 2502
Under existing law (Costa-Hawkins), new construction of rental units is not subject to local rent control ordinances. AB 2502 seeks to use “inclusionary zoning” to undo that provision in Costa-Hawkins. “Inclusionary Zoning” ordinances allow local government to require builders to set aside (include) a percentage of units at below-market rent levels. In the appellate case Palmer v. The City of Los Angeles, the court held that the City of Los Angeles could not use inclusionary zoning to evade Costa-Hawkins. AB 2502 essentially undoes that court decision, and would effectively repeal the new construction exemption of Costa-Hawkins.
- AB 2502 would exacerbate the housing affordability crisis in California. The Governor has proposed a far better solution in the May Revision of the state budget. C.A.R. supports the Governor’s proposal to streamline the local government approval process for housing developments that have 5 – 20% of the newly constructed units set aside for low or very low-income residents. Unlike AB 2502, this proposal incentivizes developers to build new affordable housing units.
- AB 2502 discourages the creation of new rental housing. The bill would make it a virtual certainty that local jurisdictions with rent control ordinances would expand their ordinances to include new construction, discouraging the development of rental housing, at a time when it is most needed.
- AB 2502 dramatically weakens Costa-Hawkins. Costa-Hawkins was passed by the Legislature in 1995, at a time, like today, when new rental housing was desperately needed. The new construction exemption in Costa-Hawkins was specifically designed to encourage the building of new rental units.
- AB 2502 seeks to disguise the expansion of rent control as “inclusionary zoning.” This bill gives local government the power to adopt a “my-way-or-the-highway” policy for the new rental housing construction. If the builder doesn’t agree to the demands of local government and set aside the required number of units, the builder CANNOT build the housing.
- Rental housing is desperately needed. At a time when rental housing is scarce, it makes no sense to discourage the building of new rental units!
- Inclusionary zoning makes every unit in a development much more expensive because the cost of the units must be increased to accommodate the below market rate units.
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