Tenants ‘Crushed’ After California Renter Protections Bill Stalls in the Legislature

After taking blows from landlord groups and the building trades, a statewide bill that aimed to expand renter protections and make them permanent is likely dead this legislative season.

AB 1157, dubbed the “Affordable Rent Act,” would have expanded the 2019 Tenant Protection Act to more renters and lowered the amount rent can increase each year. It would have also made those changes permanent, removing a 2030 sunset date.

Tuesday marked the bill’s first hearing of the year in the Assembly Judiciary Committee, where tenants and advocates pleaded with committee members to advance the bill.

But, it faced stiff opposition from rental property and building trade groups, who said it would make housing construction more expensive and could push smaller landlords out of the market.

The bill failed to get enough votes, and without any additional hearings scheduled, AB 1157 will likely die there.

“I’m just really, really crushed because they talk about how they don’t want to hurt the property owners, they don’t want to have them take their properties off the market,” said Chula Vista renter Tammy Alvarado, who took a 13-hour bus ride to testify in support of the bill.

“The problem is these greedy landlords that raise their rent [to] the maximum. They can raise it every single year while our wages don’t go up to match.”

Now, as the 2019 Tenant Protection Act moves closer towards its expiration date, Alvarado and other tenants are worried about what it means for their own housing security.

She splits the monthly payment with her husband and two children for a two-bedroom, single-family home. In November, she said her rent jumped from $2,780 to $3,030 a month — a nearly 9% increase. She also had to pay more toward her security deposit. To make up the cost, she said she would have to miss payments for her gas and electricity bills.

“Devastated,” she said. “Next time I come up here [to Sacramento], I will probably be homeless.”

Since Assemblymember Ash Kalra, D-San José, introduced it last year, AB 1157 faced an uphill battle. Powerful realtor and builder groups loudly opposed it, saying it would undermine the state’s efforts to build more housing supply.

In late April, Kalra transformed it into a two-year bill, vowing to resurface the bill this year after buying more time to work on it with lawmakers.

Tenants rights advocates were feeling hopeful about its chances this time around, especially after Gov. Gavin Newsom called out the 2019 law in his State of the State address, saying it was “the strongest statewide renter protections in America.”

Still, Kalra wanted to win over skeptical colleagues. Early in Tuesday’s hearing, he announced he would remove a controversial provision extending tenant protections to those renting single-family homes, individually owned condos and duplexes.

“It’s all on the table,” Kalra said, “if folks are willing to come to the table to have those conversations meaningfully.”

Despite the concessions made, reactions to the bill were mixed. Some committee members spoke in favor, while others raised concerns about its impact on the already expensive rental market.

“I’m concerned about the big arm of government telling private property owners what they have to do,” said Asm. Diane Dixon, R-Newport Beach. “Because at some point they say, ‘The heck with it, we’ll go to Arizona and build apartment units and housing units there for a lot less money.’”

Committee members also took issue with the bill’s lowered rent cap. Existing law allows property owners to annually increase rent by 5% plus the cost of living, or up to 10%. As inflation has increased in the years since the law was passed, the amount landlords can raise rents has crept closer to that 10% threshold. AB 1157 would have cut that in half, limiting landlords to a 5% annual increase.

In an emailed statement ahead of the hearing, Adam Pearce, president of the California Rental Housing Association, said the bill could push “mom-and-pop owners out of the market, ultimately shrinking housing supply and hurting the very renters it intends to help.”

Research on this topic is mixed. Traditionally, economists have largely agreed with that sentiment, saying that rent-control policies are inefficient, create scarcity and drive up rents in non-regulated units. But economists have also given credence to supporters’ claims that rent control is effective at stemming displacement.

Economists have argued that strict rent control could discourage new apartment construction — though other research shows more moderate policies tend to have little impact. And one recent anecdotal example seemed to support that.

In 2022, St. Paul, Minnesota, enacted one of the strictest rent-control policies in the country. Minneapolis, on the other hand, passed a series of land-use laws two years prior, boosting apartment construction.

According to a Wall Street Journal analysis, permits to build apartments in St. Paul fell by nearly 80% in early 2022, after the city passed its rent-control ordinance. Conversely, housing permits in Minneapolis saw a fourfold increase during that same time period.

But support for rent stabilization has grown among tenants and lawmakers in recent years, including from a coalition of 32 economists who wrote to the Federal Housing Finance Agency in 2023, urging the nationwide use of rental control. And last year, New York City voters elected Mayor Zohran Mamdani, who campaigned on a multi-year rent freeze for the city’s rent-stabilized apartments.

“Today’s vote is nothing short of betrayal,” Christina Livingston, executive director of Alliance of Californians for Community Empowerment, said in an emailed statement.

“At this moment, when Californians desperately need housing stability, our legislators chose to side with corporate landlords instead. When given the opportunity to solidify basic tenant protections, they failed, and we are outraged.”