An impending decision in Sacramento may greatly restrict an “abusive” loophole used to Santa Monica tenants.

At the August 10 meeting of the Santa Monica Rent Control Board, Legislative Advocate Brian Augusta updated the board on several bills that are in a “furious rush” to be passed by the 2023-24 California legislative session. With just under a month to go in the session, Augusta provided the status on three bills aimed at rent stabilization, including a proposal to limit no-fault provisions.

Under current law, evictions are prohibited without just cause, however a “no-fault” just cause classification exists that allows an owner to occupy the property either themselves, or an occupancy by the owner’s spouse, domestic partner, children, grandchildren, parents or grandparents. This tactic, Augusta noted, was used as reason for evictions during the COVID-19 pandemic, even after the enacting of the state’s Tenant Protection Act in 2019.

Currently under advisement by the state’s Appropriations Committee, SB 567 would amend current law to require the property owner, partner or family member to occupy the property for a minimum of 12 continuous months as the person’s primary residence. Existing law does not put a time frame or requirements on property occupation, meaning a property owner can evict with intent to move in, without actually doing so post-eviction. Another amendment would require all rental units at the rental property where the no-fault eviction took place to be withdrawn from the rental market.

A definition change in SB 567 also aims to hold property owners accountable in no-fault tenant removals. The bill states that a property owner must have “intent to demolish or to substantially remodel the residential real property” in order to remove a tenant, with “substantial remodel” replacing the word “repairs” used in current law. A tenant would not be required to vacate the property for “cosmetic improvements,” including painting, decorating, minor repairs, or other work that can be performed safely without having the property vacated. “Substantial remodel” will only concern work that cannot be accomplished in a safe manner with a tenant occupying the property, such as structural, electrical or plumbing replacement or modification that requires a governmental agency permit.

Extra provisions to include more housing under the bill, such as more single-family homes, were dropped from the bill in early discussions. However, the bill is poised to pass through the legislative session, with opposition taking what Augusta called a “softer tone” in comparison to other legislation.

Two other bills currently being discussed in Sacramento are amendments to the Costa-Hawkins Rental Housing Act of 1995, which may be repealed outright on the November 2024 ballot.

California Assembly Bill 1620 amends Costa-Hawkins for tenants with a permanent disability related to mobility, authorizing the tenant to move to an available comparable or smaller unit with disability accommodations. The move to an accessible unit would be made under the same rent price and terms as the tenant’s current unit. To gain access to accommodations, the floor of the tenant’s current dwelling or unit must have no operational elevator, and the tenant must provide the owner with a written request to move to an accessible space before the unit becomes available.

The bill is not a statewide obligation, but rather gives local governments the authority to enact the provision. The bill has previously been supported locally by officials in both Santa Monica and West Hollywood, Augusta stated. Realtors continue to oppose the bill, which has made it through a first vote.

Another potential amendment to Costa-Hawkins, SB 466, would have expanded rent control to units previously exempt from the rules. However the bill faced massive opposition and is not expected to advance.

Separate from efforts in Sacramento to amend the Costa-Hawkins act, California voters will be able to vote on expanded rent control rules on the November 2024 ballot. The Justice for Renters Act measure, which would repeal Costa-Hawkins, recently gathered enough signatures to qualify for the 2024 ballot. Similar propositions in previous years have failed to pass, with Prop. 10 failing by 19 points in 2018 and Prop. 21 failing by a similar margin in 2020.

Rent Control Board Chair Anastasia Foster ended the presentation by stating that there is “a lot of talk around” Costa-Hawkins at the moment, voicing her concerns about “rapidly increasing rent” in Santa Monica and beyond.

“There will be no one left in the state of California to serve them their dinner … if they have nowhere to live … if lateral moves are made impossible when your family size changes or your circumstances change or your city changes,” Foster said. “The desire for return today is blunting, I think, some of our property owners ability to see the long-term, and that they are going to price themselves out of customers and be fighting each other for a scarcer and scarcer amount of wealthy individuals, who will find that the services that they love in their luxury cities by the sea no longer exist because there’s no one to provide them.”

  • Correction: This story has been updated to reflect the legislative body considering the bills is at the State, not Federal, level.