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Proposition 10 – Local Rent Control Laws

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General Election, November 06, 2018

Overview:

Several local cities in California have enacted local laws that limit how much landlords can increase rents for housing from one year to the next.  These types of local laws are referred to as “rent control.”  Overall, about one-fifth of California residents live in cities (including Los Angeles, San Francisco and San Jose) with rent control.

There are several limitations on these rent control laws.  First, the courts have ruled that rent control laws must allow landlords to receive a “fair rate of return.”  This means that landlords must be allowed to increase rents enough to receive some profits each year.

In addition, a state law called the Costa-Hawkins Rental Housing Act (“Costa-Hawkins”) also limits local rent control laws in three main ways.  First, rent control cannot apply to any single-family homes.  Second, rent control can never apply to any newly built housing completed after February 1, 1995.  Third, rent control laws cannot tell landlords what they can charge a new renter when first moving in.

Proposition 10 repeals these limits on local rent control laws contained in Costa-Hawkins.  Cities and counties would be able to regulate rents for any housing – including single family homes and new housing completed after 1995.  In addition, the proposition would allow local rent control laws to limit how much a landlord can increase rents when a new renter moves in.

Proposition 10 itself does not make any changes to local rent control laws.  With a few exceptions, cities and counties would have to take separate actions to change their local rent control laws.

A YES vote on Proposition 10 means state law would not limit the kinds of rent control laws cities and counties could have.

A NO vote on Proposition 10 means state law would continue to limit the kinds of rent control laws cities and counties could have.

Fiscal Impact:

According to the Legislative Analyst Office (LAO), Proposition 10 would result in a potential net reduction in state and local revenues of tens of millions of dollars per year in the long term.  Depending on actions taken by local governments, revenue losses could be less or considerably more.

CCC Position:

No position.

Reflections on Church Teaching:

“The political community has a duty to honor the family, to assist it, and to ensure especially…the right to private property, to free enterprise, to obtain work and housing, and the right to emigrate.”  Catechism of the Catholic Church, no. 2211.

“There must be made available to all men everything necessary for leading a life truly human, such as food, clothing, and shelter…”  Pastoral Constitution on the Church in the Modern World (December 26, 1965).

“Profit and capital are not a good over and above the human person; they are at the service of the common good.  When the common good is used only at the service of profit and capital, this has a name: it is called exclusion, and through it the throwaway culture gets stronger and stronger. Throwaway and exclusion.” - Pope Francis, 2017

“I want to be very clear. There is no social or moral justification, no justification whatsoever, for lack of housing. There are many unjust situations, but we know that God is suffering with us, experiencing them at our side. He does not abandon us. Jesus not only wanted to show solidarity with every person.” – Pope Francis, Visit to St. Patrick’s Parish and meeting with the homeless, 2015

 “As preachers of the Gospel, we proclaim the message of Jesus Christ who identifies Himself with the needs of the least of the brethren. The second great commandment is to love our neighbor. We cannot deny the crying needs for decent housing experienced by the least of the brethren in our society. Effective love of neighbor involves concern for his or her living conditions.”  USCCB, The Right to a Decent Home: A Pastoral Response to the Crisis in Housing (November 20, 1975).

The "principle of subsidiarity" must be respected: "A community of a higher order should not interfere with the life of a community of a lower order, taking over its functions." In case of need it should, rather, support the smaller community and help to coordinate its activity with activities in the rest of society for the sake of the common good. —Pope John Paul II, Centesimus Annus, #48 (1989)