🏡💚 The suspense isn't killing us
May 17, 2024
Yesterday marked one of the major milestones of the state legislative cycle, with advocates holding their breath as they waited to see which bills would survive the Appropriations suspense file. Because of the arcane rules of our humble democracy, the Appropriations Committee is the one place in the legislative process where bills can be killed without legislators needing to cast a vote (with the somewhat poetic designation of being “held in suspense”). As a result, it’s a day that causes significant handwringing for advocates, wonks, and political junkies.
A few unlikely groups were also watching the results of yesterday’s hearings with baited breath: corporate landlords and oil producers. That’s because of a slate of bills this year that target each, with policies that seek to address the interconnected housing, climate, and public health crises we face in the state.
Corporate landlords have long been major asset owners for multi-family apartment buildings. But especially since the financial crisis and Great Recession of 2007-2008, corporations and investment firms have increasingly turned their attention to acquiring single-family homes, which continues to this day. The result is rising rents and a worsening housing crisis, with the effects being documented as much as possible. One report shows how properties bought by Blackstone in San Diego led to rent increases, as part of a disturbing trend of private equity acquisitions.
But it’s hard to even know the full extent of corporate housing ownership in the state. If you came to this week’s coalition call, you heard from Doni Tadesse at Rise Economy about how we lack transparency on the owners of many companies and assets in the state. The state collects very little data about limited liability corporations (LLCs), which has led to the widespread use of “shell LLCs” that obscure the ultimate owners. This leads to huge challenges in corporate accountability across many different sectors. Corporations use this to hide their full real estate portfolios, skirt labor law enforcement, and to sell their oil assets to create “orphan” wells that have no legal responsible owner.
SB 1201 (Durazo, LLC Owner Transparency Act) tries to address this issue by requiring LLCs to state their “beneficial owner” when they submit periodic reports to the state. Sounds simple and easy right? Well… not according to the Senate Appropriations Committee, who marked the bill with a $9.3 million initial price tag. Advocates are astounded by this, especially since an almost identical bill in 2020 was estimated at just over $500,000. While $9 million is still basically pocket change for a state like California, in another tough budget year, even this kind of price tag means will be a big obstacle to overcome.
But that’s nothing new for this bill and those fighting for it. A coalition of tenant groups, unions, legal aid organizations, housing advocates, community organizations, and transparency activists have been trying to push a version of this bill for 3 years.
Despite all of that, a bit of good news yesterday: SB 1201 passed through Senate Appropriations and moves on to the Assembly.
That’s not the only bill targeting corporate landlords. Alex Lee introduced a bill (AB 2584) that would ban institutional investors from buying or investing in additional single-family rental home properties. Last year, Chris Ward introduced a bill (AB 1333) that would ban developers from selling homes in bulk to big investors. And ACA 10, the Right to Housing, is a direct challenge to treating housing as a speculative commodity.
Ward’s proposal is a two-year bill and will try to work it’s way through the Senate next. For the other two: both survive and move on from Appropriations (in an especially big win for the ACA 10 coalition!).
I would be remiss to not also mention the slate of bills targeting polluters, many of which we voted to endorse as the California Green New Deal Coalition. AB 1866 (Hart) and AB 2716 (Bryan) both go after owners of idle and low-producing oil wells, while AB 3155 (Friedman) makes oil drillers liable for community health harms they cause.
Senator Menjivar’s ambitious SB 1497 would make polluters pay for the damage they’ve caused to California and the climate. In the face of ongoing state budget deficits, this bill would bring in money from the largest fossil fuel producers for a fund that would address climate damages.
In another promising result, all of these bills made it through Appropriations.
Of our CA GND bill slate, here are the results from yesterday’s Appropriations Committees (you can see full results from the Assembly here and Senate here):
Housing and Climate Justice Slate
ACA 10 Haney Right to Housing — PASSED
ACA 16 Bryan Green Amendment — PASSED
SB 1201 Durazo Limited Liability Corporation (LLC) Owner Transparency Act — PASSED
General Slate
AB 846 (Bonta) Rent Cap for Affordable Housing — In Senate
AB 1866 (Hart) Idle wells — PASSED
AB 2086 (Schiavo) Transportation Accountability Act — PASSED
AB 2200 (Kalra) Guaranteed health care for all — HELD IN APPROPS
AB 2716 (Bryan) Idle wells — PASSED
AB 3233 (Addis) Gas Code updates: local control — PASSED
SB 252 (Gonzalez) CalPERS & CalSTRS Divestment — 2-year bill
SB 938 (Min) Utility Accountability — DIED IN PREVIOUS COMMITTEE
SB 1182 (Gonzalez) Master Plan for Healthy, Sustainable, and Climate-Resilient Schools — PASSED
SB 1187 (McGuire) Tribal Housing Reconstitution and Resiliency Act — PASSED
SB 1497 (Menjivar) Polluters Pay Climate Fund — PASSED
Together, these bills show an increasing openness from state lawmakers to go after the most powerful interests in the state: Big Oil and Big Landlord. And at least for now, many of those bills live to see another day.
Make Polluters Pay rally with Senator Menjivar. Source: Twitter
WHAT WE’RE READING
Trial over mass evictions at Barrington Plaza could hinge on meaning of “permanent” (LA Times) - read about how the landlord at Barrington Plaza make sthe claim that “the term ‘permanently’ doesn’t mean forever”
Tenant rights organizer sees opportunity amid housing crunch (The Hill)
Social Housing Can Work (Jacobin)
California lawmakers want to crack down on corporate landlords. Could it backfire? (SF Chronicle)
We’ve sent this out to everyone on the current CA GND listserv. If you don’t want to get these weekly newsletters, feel free to unsubscribe below. If you know someone that would be interested, send me their email, or you can forward this along to them and they can use this link to subscribe.
