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Assembly Bill Strengthening Cities Ability to Use Inclusionary Housing Tool for Rental Units Moves to Senate

May 12, 2017
California cities are on the front lines of the state’s housing crisis and need tools to help encourage the development of more affordable units for residents.
AB 1505, a bill that clarifies and strengthens cities’ authority to use the inclusionary housing program for rental units is on its way to the Senate.
Assembly Member Richard Bloom (D-Santa Monica) is authoring this bill because he believes that local governments need more options to help address the housing crisis. He made this point again in a May 4 press release following the Assembly’s vote on the measure: “Housing costs across the state have increased exponentially and absent corrective action there is no end in sight,” said Assembly Member Bloom. “Given our state’s severe housing crisis, it is critical that we give local governments every tool to address affordable housing needs. This bill returns one of our most important and effective tools.”
This League-supported bill gives cities more opportunities to increase their affordable housing stock. The measure clarifies that under the law, cities have the option to impose inclusionary housing programs for both for sale and rental housing developments.
These programs would help meet the affordability needs of residents despite developer resistance. This measure would also complement the additional pending bills that seek to bring much needed financial resources to affordable housing programs.
In the California Court of Appeals decision in Palmer/Sixth Street Properties L.P. v. City of Los Angeles, 175 Cal. App. 4th 1396 (2009), the court took a very broad interpretation of the Costa-Hawkins Act and its application on inclusionary housing ordinances, opining that inclusionary housing ordinances with regards to rental housing conflicted with and were pre-empted by the Costa-Hawkins Act. Costa-Hawkins was intended to restrict systems of rent control, not preclude rent restrictions on inclusionary housing. 
Next Steps
June 2 is the Legislature’s House of Origin deadline. After that date, bills that have moved to their second house will be scheduled for committee hearings. Expect those hearings to ramp up in early to mid-June. The League will keep cities notified of AB 1505’s hearing schedule.

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