More momentum on California rent control

Is the tide turning in favor of California’s renters?

Some signs say yes.

On Wednesday, Attorney General Rob Bonta announced that a San Jose-based developer and property manager must refund more than $331,000 to 20 tenants in overpaid rent. It’s the first use of a 2019 law, explains CalMatters’ housing reporter Ben Christopher, but “it won’t be the last,” Bonta said.

Lawmakers considered this law, known as the California Tenant Protection Act, as one of the largest expansions of tenant protections in decades. And it started some momentum for tenant advocates in the Legislature, according to Alejandra Reyes-Velarde of CalMatters’ California Divide team.

Here are some more details on these stories:

Landlords pay up: In 2021, Green Valley Corp. hiked the rents of tenants living near San Jose’s Japantown an average of 151%. This far exceeds the 5% cap (plus inflation) that’s allowed by the 2019 law, and now the Department of Justice is ordering the developers to reimburse tenants. 

It’s a big win for tenants, who often do not have enough money to legally challenge offending landlords, as well as advocacy organizations who say that the state is finally enforcing a law that has been long ignored.

• Madeline Howard, an attorney for Western Center on Law & Poverty: “I am hoping that seeing the attorney general working on this is going to really encourage landlords to be more careful about complying with these protections. Landlords should take note.”

Renters struggle for stronger policies: Compared to the California Apartment Association, which has spent nearly $7 million lobbying on behalf of landlords and real estate groups since 2017, renters don’t have nearly as much political cash.

That can lead to less influence — made apparent when one bill that would have strengthened the 2019 law removed provisions to cap rent at 5% (due to sky-high inflation, rent can legally increase now by 10% statewide). Despite this setback however, some do believe the tide is slowly turning for renters — especially since voters are seeing the impacts of California’s housing crunch and homelessness crisis.

• Amy Schur, campaign director for the Alliance of Californians for Community Empowerment Institute: “Politicians are both concerned about the issue and concerned about their chances of reelection if they don’t address it.”

But Debra Carlton, a spokesperson for the California Apartment Association, argues that there has been no outright victory for the rental industry and that more regulations against them would mean limiting housing development and hurting mom-and-pop landlords.

• Carlton: “I don’t know that we’ve seen anything in the last decade or so that we would tally, if you will, as a complete win for the rental housing industry. That just doesn’t happen in this Legislature.”

Speaking of the Legislature: Lawmakers will have to finalize and approve its budget proposal by midnight today in order to get paid. Lawmakers will continue negotiating with Newsom to agree on the final budget by July 1. The nonpartisan Legislative Analyst’s Office highlights some key differences.

For more on where we are on the budget timeline, read our new explainer from CalMatters’ state Capitol reporter Sameea Kamal. And for more on why the state faces an estimated $31.5 billion shortfall for 2023-24, read another explainer by data and interactives editor John Osborn D’Agostino and data reporter Jeremia Kimelman. 

Fresno housing: A CalMatters live event, in partnership with Fresnoland, will focus on housing affordability in Fresno. It is scheduled for 6-7 p.m. today, in person at the Fresno Art Museum and virtually. Sign up here to attend.

Reparations calculator: CalMatters has created an interactive tool to estimate how much someone might be owed in reparations for slavery and racism. Look it up here, watch a TikTok about it, see it on Instagram and read the full story from Wendy Fry of CalMatters’ California Divide team.

If you have questions on reparations, send an email to Wendy at wendy@calmatters.org.

Other Stories You Should Know

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1 Kids visiting parents behind bars

On Monday, the Senate public safety committee passed a bill that would require California’s prison system to house inmates close to their families.

Authored by Assemblymember Matt Haney, a Democrat from San Francisco, the bill would affect prisoners who have children age 17 and younger. It would mandate that the state’s Department of Corrections and Rehabilitation house a prisoner in a facility that is “located nearest to the primary place of residence of the person’s child” and would also allow existing incarcerated parents to request a transfer to a prison that is closer to their child’s home. 

Haney called the measure, approved by the Assembly 70-0, a common-sense criminal justice change that both parties support. 

• Haney, to CalMatters: “The less a parent and a child see each other, the more harm is done to that relationship in a way that impacts the well-being of the child and the rehabilitation of the parent. This is especially harmful for mothers who can’t see their child, but it’s really true for all parents.”

According to a 2000 estimate from the California Research Bureau, about 195,000 children have parents in California state prisons. And data from the corrections department show that about 61% of incarcerated people in California state prisons in 2019 are imprisoned in an institution 100 miles or more from their home. 

This has a big impact on visitation — half of people who are placed within 50 miles from home frequently have family visits, but that percentage drops to 15% when they are placed 500 miles away from visitors, reports the nonprofit Legal Services for Prisoners with Children, which supports the bill.

By making it easier for families to visit in-person, proponents argue that not only will the well-being of the child improve, but it also reduces prison recidivism rates.

In other news about children: KidsCount released its annual report on child well-being on Wednesday, with California coming in 35th in the nation, dropping two places from last year. Though metrics such as economic well-being and education slightly improved, health scores (which incorporate child and teen death rates and obesity rates) worsened.

Alongside the report, the advocacy group Children Now penned a letter to the governor and the Legislature that pushed for a 25% increase in child care subsidies. This comes ahead of a rally at the state Capitol today, where members of the Child Care Providers United union will join legislators to campaign for an increase in funding. In their latest budget proposal, legislative Democrats want $1 billion to increase reimbursement rates for providers of subsidized child care. The governor, meanwhile, wants to change rates through other, more comprehensive means.

2 Recovering from natural disasters

After a series of deadly wildfires, two major insurance companies, State Farm and Allstate, have stopped selling homeowners’ insurance policies to new customers in the state. 

Residents shouldn’t worry too much yet — about 115 companies still offer home insurance in California. But you may be wondering what the state could do if more companies follow suit. CalMatters’ economics reporter Grace Gedye explores four notable ideas that have been floating among consumer and insurance industry groups:

Force State Farm to keep issuing new policies: Before charging customers, insurers must get state approval for their rates.

• Pro: If a company suddenly decides not to serve the same number of customers, it’s changing the calculations. Until it submits new rates for approval, the department could force State Farm to keep insuring new customers.
• Con: It might not even be legal for the insurance department to do this.

Use forward-looking catastrophe models: To justify rate changes, insurance companies have to use only past losses to project future losses. 

• Pro: The state already permits insurers to use these models for earthquake insurance but not for wildfire insurance. 
• Con: Consumer groups fear companies will use these models to overstate risk, hike prices and evade scrutiny with complex math.

Address reinsurance costs: Insurance companies aren’t allowed to incorporate the cost of reinsurance — or insurance for insurance.

• Pro: Insurance industry groups say it would help if they could include reinsurance costs into their prices. 
• Con: Consumer groups argue that premiums would spike.

Reduce the risk of disasters: This includes incentivizing home owners to take steps to protect their homes.

• Pro: Homes and buildings will be less likely to burn, flood or collapse and California will feel less risky to insurers.
• Con: As with most things — extra money, time and effort.

Survivors of another kind of California disaster — floods — are also straining for support. A new study by UC Merced’s Community and Labor Center surveyed households in Planada, a farmworker town in northern San Joaquin Valley. In January, a nearby levee failed and thousands of people were displaced after half the town flooded, reports Nicole Foy of CalMatter’s California Divide team.

Working with community outreach workers, researchers found that state and federal disaster aid have not been sufficient with helping residents recover from severe economic hardship. Among the study’s findings:

• About 83% of the town experienced some type of economic loss from the flooding.
• Half of Planada households are renters and 94% of them did not have flood insurance.
• An estimated 64% of flood-damaged households did not qualify for federal aid.

In June, California is expected to distribute $95 million to assist undocumented residents such as those in Planada who experienced damage from storms and flooding this year but were ineligible for federal disaster aid.

3 Rural campuses fall short on LGBTQ+

California may have a reputation for being a safe and welcoming enclave for members of the LGBTQ+ population, but for queer students attending community colleges in rural areas and small cities, resources for support and building community are hard to come by.

As CalMatters’ community college reporter Adam Echelman explains, in 2021, the state gave $10 million to community colleges for LGBTQ+ student support programs. It was a first-of-its-kind grant to fund services including hiring queer-friendly mental health professionals (LGBTQ+ students are more likely to commit suicide than their peers), training for staff and events such as special graduation ceremonies.

But in a 2022 report to the chancellor’s office obtained by CalMatters, college administrators said that setbacks for LGBTQ+ students persist. And the grant money amounts to less than $100,000 on average over five years for each of California’s 115 brick-and-mortar community colleges — not enough to hire staff positions or to establish an on-campus LGBTQ+ center.

To date, only 30 of California’s community colleges have a designated LGBTQ+ space on campus. And one consultant for the Legislative LGBTQ+ caucus told Adam that while it’s crucial to set up spaces for queer students, the grant money was never supposed to fund LGBTQ+ centers.

In this year’s legislative budget proposal, another $10 million over three years has been set aside for LGBTQ+ services.

Elsewhere in California public education, anti-LGBTQ+ sentiment has cropped up in other school districts. On Tuesday, the Temecula Valley Unified School District voted to fire its superintendent after rejecting an elementary social studies curriculum that mentioned gay rights advocate Harvey Milk earlier this month. 

And today, the school board for the Chino Valley Unified School District is considering a policy that would require staff to out transgender students to their parents. The proposal would go against existing guidance from the state’s Department of Education.

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