The Ballot Initiative Tenants Need to Know About

Proposition 10 will be on the ballot this November

Proposition 10, known as the Affordable Housing Act, will be on California’s state ballot this November 6. What is Prop 10 and why should you care about it? Well, Prop 10 seeks to repeal one of the most draconian housing laws ever enacted in California, namely the Costa Hawkins Rental Housing Act.

If Prop 10 passes, cities and counties in California will be able to design tenant protections tailored to their specific housing stock and local rental market. This could be a huge change, because local governments and voters have been hamstrung by a restrictive state law that has curtailed tenant rights since 1995. Here’s what you need to know:

What is Costa Hawkins?

Costa Hawkins restricts the types of rent control laws that California cities are allowed to enact. It has three main effects:

  1. It exempts buildings constructed after 1995 from rent control. (In cities that already had rent control in 1995, Costa Hawkins puts the cutoff much earlier– it’s 1979 for both San Francisco and Los Angeles.)
  2. Exempts single family homes and condominiums from rent control (where tenancy began after the law’s passage)
  3. When a tenant dies, moves out, or is evicted from a unit, the landlord is entitled to raise the rent to market rate. (This is known as “vacancy de-control.”)

Landlords love this law. In fact, they wrote it. Beginning in the late 1970s, the real estate industry began lobbying Sacramento for statewide restrictions to limit the power of renters, who are more organized on the city level. Finally, in 1995, the state legislature pushed through Costa-Hawkins. Due to ferocious industry support of the bill, it’s long been seen as untouchable. But with an unprecedented affordability crisis now touching every corner of our state, there is real momentum to repeal Costa-Hawkins.

What’s so bad about Costa-Hawkins?

Costa-Hawkins enshrines vacancy de-control, which perversely incentivizes landlords to force out long-term tenants in order to levy almost unlimited rent increases.

Here’s a common worst-case scenario under Costa Hawkins. Let’s say Jim moves into a unit in 1985. Under San Francisco’s rent control laws, Jim receives reasonable increases each year. He’s a model tenant and always pays on time. In 1997, Jim marries Susan, who is the parent of a young disabled child. The small family thrives together in Jim’s rental unit, until Jim passes away in 2017.

Because Costa-Hawkins does not recognize Susan and her child as “original occupants,” Jim’s widow and child can receive a rent increase to market rate within just sixty days of his death. This means that rent for their two-bedroom San Francisco apartment might go from $900 per month to $4,000 — and the grieving family has only sixty days to come up with the money or find new housing. What’s more, “market rent” isn’t defined, so landlords will frequently raise long-time tenants’ rent to outrageous sums in order to force them out and renovate the unit.

Sadly, situations just like this are all too common in San Francisco today. In addition to these unfair loopholes, Costa-Hawkins worsens the affordability crisis by prohibiting cities from expanding or even maintaining their stock of rent-controlled housing. Advocates report that Los Angeles is losing 5.5 rent-controlled units every day. In San Francisco, the percentage of units covered by rent control has declined from 92% in 1979 to only 69% today.

Finally, Costa-Hawkins’ exemption of single family homes and condos was meant to protect “mom-and-pop” landlords. But today, tens of thousands of single family homes and condos in California are owned by Wall Street investment firms and corporate “mega-landlords,” who lean on Costa-Hawkins to extract maximum profits from their tenants.  

Vote Yes on Prop 10 for Real Rent Control

Want to know just how valuable Prop 10 could be to California’s renters? Just look at the how much landlords are willing to spend to oppose the measure. As of this August, the No on 10 campaign had banked well over $20 million in cash. In the coming months, they’ll be using those funds to blast voters with ads that claim that Prop 10 will somehow make our state’s housing more expensive. (Local housing guru Randy Shaw demolishes their falsehoods here.)

Can you tell we’re riled up about this? We hope you will be, too! If you’d like to get involved in the Yes on 10 campaign to support Californians’ right to rent control, start at voteyesonprop10.org.