A year ago Gov. Jerry Brown signed a massive package of 15 bills designed to help alleviate the state’s housing shortage.
This year, the end of the Legislative session was less dramatic in terms of real estate. A few bills that the governor signed – and at least one that he vetoed – are worth noting, however.
Perhaps most significant for the Bay Area was AB-2923, designed to encourage transit-oriented development around BART stations, which Brown signed on Oct. 1.
The controversial measure, authored by Timothy Grayson, D-Concord and David Chiu, D-San Francisco, gives the transit district more authority over the 250 acres it owns around existing and future BART stations.
"We can no longer afford to say no to building housing, especially around transit hubs," said Chiu, chair of the Assembly Housing and Community Development Committee.
Cities and counties have two years to modify zoning restrictions or risk losing control over projects on BART land in their communities.
The result could be an estimated 20,000 additional housing units by 2040.
This new law won’t directly impact Livermore, as BART has rejected extending service here. But Pleasanton and Dublin, as well as other nearby cities and unincorporated areas could be forced to accept housing that does not conform to their general plans.
Among the bills vetoed by the governor was a so-called “work-around” to the federal tax bill that passed last year. That law caps state and local deductions on federal taxes at $10,000. That cap applies to state income taxes and property taxes combined, meaning many folks in high-cost states such as California will be unable to deduct all of those taxes on their federal taxes.
SB-539 would have expanded to 75 percent an existing tax credit for contributions to a state college scholarship program. The idea was that taxpayers would contribute more into the state program – which is tax-deductible – to compensate for the limits on deductions for state and local taxes.
The bill, introduced by Kevin de Leon, D-LA, who is currently running for the U.S. Senate, would also have benefitted low-income college students.
The governor in his veto message noted that the Internal Revenue Service has already vowed to disallow similar workarounds from other states.
“This measure started as a bold idea but because of adverse changes in the federal tax law, it now confuses an already complicated scheme and could invite intervention by the Internal Revenue Service,” he said.
Another measure from de León, SB-100, fared better.
This bill straightens California’s commitment to clean energy, requiring state utilities to acquire 100 percent of their power from clean energy sources by 2045, including a mix of renewables, hydroelectric power and bas plants that capture carbon. California and Hawaii are currently the only two states with such ambitious renewable energy goals.
He also signed bills to streamline the approval of certain affordable housing projects with units for the homeless, a bill adding services for homeless youth, bills to limit rent hikes in areas affected by natural disasters, and legislation aimed at protecting homeowners who take out PACE loans to install solar energy systems.
Other new laws make permanent the Homeowner’s Bill of Rights and straighten protections for those covered by the federal Fair Housing Act.
On the Ballot
Not going through the legislative process are three housing-related initiatives on the ballot this November.
Proposition 1 would authorize $4 billion in general obligation bonds for housing-related programs, loans, grants, and projects and housing loans for veterans.
The proposition has wide support from legislators, municipal governments, labor and veterans groups. Those who oppose the measure express concern that it will add to the state’s debt.
Proposition 5, the Property Tax Transfer Initiative, would amend Proposition 13 (1978) to allow homebuyers who are age 55 or older or severely disabled to transfer their property tax basis, no matter what the new home’s market value or location in the state, as many times as they choose.
Current law limits property taxes on individual homes, and tends to keep those taxes lower than they would be on similar newly purchased properties.
In addition, Proposition 60 (1986) allows homeowners age 55 or older or severely disabled to transfer their property tax base year value to a new home in the same county or in any of the other participating counties.
But those transfers require that the new home sell for less than the home being sold in most cases, and homeowners are limited to one such transfer in their lifetime. Proposition 5 would eliminate those requirements, providing seniors with more flexibility to live where they choose.
This initiative is strongly supported by the California Association of Realtors, as well as a group called Homeownership for Families and Tax Savings for Seniors.
It is opposed by SEIU California State Council Political Committee.
Proposition 10 would repeal the Costa Hawkins Rental Housing Act, a state law that limits how cities can apply rent control. This initiative would make it easier for cities to enact strict limits on when and how much landlords can increase rents.
The initiative is endorsed by the Los Angeles County Board of Supervisors, Inner City Law Center, Western Center on Law and Poverty, Public Counsel, Democratic Socialists of America Los Angeles, Los Angeles County Democratic Party, ACLU of California, and League of Women Voters of California.
It is opposed by BRIDGE Housing, California Council for Affordable Housing, California State Conference of the NAACP, California Apartment Association, California Building Industry Association, Los Angeles Latino Chamber of Commerce, and Los Angeles Area Chamber of Commerce.
Advocates see this measure as a way to keep rent more affordable.
Opponents argue that rent control limits supply as more property owners choose to sell their properties rather than keep them as rental units. It can also discourage property owners from maintaining rental properties, since they won’t be able to charge more for better-kept units.
Cher Wollard is a Realtor with Berkshire Hathaway HomeServices Drysdale Properties, Livermore.