With the State legislature adjourning on September 12, this year’s legislative cycle in the State Capitol has come to a close. Below is a quick summary and update of the legislative bills that the California Association of REALTORS® supported and opposed in 2013.
AB 1229 (Toni Atkins) – Inclusionary Zoning
What It Would have Done: AB 1229 would have allowed local governments to force newly constructed housing developments to provide new rent controlled units at the site of the development, significantly expanding the stock of rent controlled units in California.
REALTOR® Impact: AB 1229 effectively reverses the state-wide rent control limitations that were established in the landmark “Costa-Hawkins” law sponsored by C.A.R. in 1995. Additionally, by forcing new housing developments to include below-market-rate units in their financing structure, AB 1229 would have significantly slowed the development of new housing across the state.
C.A.R. Position: Oppose.
What Happened: AB 1229 narrowly passed the Assembly and State Senate houses with heavy grassroots opposition from REALTORS®. Governor Brown vetoed AB 1229 on October 13, 2013 thereby killing the bill.
SB 30 (Ian Calderon) - Debt Forgiveness Income Tax
What It Does: SB 30 would have provided tax relief to property owners who are selling their homes in a short sale. It would have brought California into alignment with the federal government’s Mortgage Debt Reduction Act of 2007, which forgave borrowers from income tax liability on debt forgiven in a short sale.
REALTOR® Impact: SB 30 would have guaranteed that homeowners, particularly ones with underwater mortgages, could short sell their homes without fear that they would face income tax liability from the debt forgiven in a short sale. It would have allowed distressed homeowners to regain financial stability without being penalized by the government.
C.A.R. Position: Support, Sponsored.
What Happened: In the Senate Appropriations Committee, SB 30 was “linked” to another bill, SB 391, which meant that SB 30 could not become law without SB 391 also passing. C.A.R. strongly opposed linking the two measures, and worked through the year to unlink the bills. SB 30 became a “two year” bill, and can be passed and signed into law as late as April 14, 2014.