Assemblymember Richard Bloom’s (D-Santa Monica) bill to protect California tenants from eviction passed out of its second Assembly Committee today on a 7-3 vote. The measure, AB 2364, closes loopholes in the Ellis Act that have allowed some landlords to displace tenants and raise the price of rent control units. Though misuse of the Ellis Act has existed for decades, the current housing crisis has exacerbated the problem.
“The housing crisis has left tenants increasingly vulnerable in the face of rapidly escalating housing costs,” said Assemblymember Bloom. “Though insulated from some of these price increases, tenants in rent control units are at risk of displacement by landlords who want to raise rents to market prices. AB 2364 protects these tenants and prevents the loss of affordable housing in cities with rent control.”
The Ellis Act gives rental property owners the right to exit the rental housing market, but also places conditions and restrictions on landlords who evict tenants in order to exit the market. These conditions include a requirement to notify tenants 120 days prior to withdrawing a unit, with a longer 1 year notification requirement for tenants who are disabled or above the age of 62. The Act also restricts when owners can re-enter the market, what price they can re-rent units at when they re-enter, and requires that all units in a building be removed simultaneously. As the housing crisis has driven up the market rate for rental units, landlords are increasingly subverting the Ellis Act and using it to evict tenants living in rent control units. These landlords often withdraw individual units from the rental market and return them in a piecemeal manner to avoid the Act’s restrictions and to evade rent control. In the Los Angeles area alone, over 20,000 rent-stabilized units have been removed from the rental market since 2001, with tens of thousands of tenants evicted in the process.
AB 2364 clarifies the Ellis Act by setting one withdrawal date for a property, by requiring the entire property to be deemed back on the market if one unit is returned, and by increasing the length of time for which a property owner can be penalized for re-entering the rental market. The measure also eliminates the cap on punitive damages and clarifies that these changes are only prospective.
The bill is supported by a number of organizations, including the City of West Hollywood, which has long been a champion of affordable housing.
“At the City of West Hollywood, we are thrilled to hear that the Assembly Judiciary Committee has approved AB 2364,” said City of West Hollywood Mayor John Heilman. “This legislation closes legal loopholes and provides renters with urgently needed protections. An increasing number of renters in the state have faced evictions under the Ellis Act. West Hollywood is thankful for Assemblymember Bloom’s leadership and the initiative taken by other state legislators who stand in support of AB 2364. Although this legislation only addresses some of the problems with the Ellis Act, it is an important step in the right direction. We look forward to continuing our work with Assemblymember Bloom to protect the rights of renters.”
“For too long, ambiguities in the Ellis Act have allowed some landlords to evict tenants simply for higher profits. AB 2364 will give renters more protection against such practices,” said Assemblymember Bloom.
AB 2364 now heads to the Assembly Floor.