Citrus Valley AOR joined 2,500 REALTORS® who descended on Sacramento on Legislative Day to stump for homeownership and property rights. You too can have a say, go to http://www.cvarrac.net to find out more!
*AB 71 (Chiu) – Mortgage Interest Deduction for 2nd Homes – OPPOSE
*C.A.R. Opposing Bill that Would Eliminate Mortgage Interest Deduction on Second Homes
* CALL TODAY! VOTE COULD BE TOMORROW!
C.A.R. is OPPOSING UNLESS AMENDED AB 71 (Chiu) a bill that would eliminate the mortgage interest deduction for second homes to fund an increase in low-income housing tax credits. While C.A.R. supports increasing the amount of tax credits available for low-income housing, the association is opposed to doing so at the expense of the mortgage interest deduction for second homes. AB 71 will be voted on by the entire Assembly as soon as TOMORROW – Wednesday, May 31st.
Urge your Assembly Member to Vote NO on AB 71
Enter your NRDS ID (or the Red Alert PIN number in the chart below)
followed by the # sign to be connected to your legislator’s office.
When staff answers the phone, you can use the following script:
“Hi, this is (insert your name). I’m a constituent and a REALTOR®. Please ask the Assembly Member to Vote No on AB 71.”
Also, if you use Twitter™, please Tweet the following:
Govt shouldn’t change the rules. , please protect the MID. #NoAB71
*Background and Talking Points
While C.A.R. supports increasing the amount of tax credits available for low-income housing, we are opposed to doing so at the expense of the mortgage interest deduction for second homes.
AB 71 (Chiu) would eliminate the mortgage interest deduction (MID) for second homes to fund an increase in low-income housing tax credits. If the MID were eliminated for second homes, 2,152 home sales would be lost in the first year after implementation. The potential impact of the MID elimination is an economic loss of $180.2 million to the state of California in the year following the implementation.
C.A.R. opposes changing the mortgage interest deduction because:
The state shouldn’t change the rules after the fact. People made significant financial decisions, trusting that the mortgage interest deduction would be there to make the property affordable.
The MID is already capped. The amount of the mortgage interest deduction is already capped regardless of whether the taxpayer has one home or two homes. It’s not right for government to dictate to homeowners how they can allocate their housing dollars!
Second homes are not necessarily “vacation homes.” Someone faced with a one-way commute of an hour or more may choose to purchase a small condo near where they work in which to live during the workweek.
Local economies and communities will suffer. The economic health of the recreational areas of the state will be harmed by elimination of the mortgage interest deduction on second homes. Homeowners in those areas of the state are going to be hard pressed tofind a buyer if the mortgage interest deduction on second homes is eliminated.
Using the MID as a piggybank sets a dangerous precedent.
Election Day 2016 is now one for the history books. No matter where your partisan political preferences may rest, your non-partisan REALTOR® Party has been hard at work throughout this election cycle to help elect REALTOR® friendly candidates in the U.S. House of Representatives, the California State Senate and the California State Assembly. To that end we at the Citrus Valley Association of REALTORS® are pleased to announce that ALL of the REALTOR® Party candidates in our service area have been elected or in some cases re-elected.
In the U.S. House of Representatives, where we need to keep the Mortgage Interest Deduction and 1031 exchanges, we congratulate:
Congressmember Judy Chu – 27th Congressional District
Congressmember Pete Aguilar – 31st Congressional District
Congressmember Grace Napolitano – 32nd Congressional District
Congressmember Norma Torres – 35th Congressional District
Congressmember Ed Royce – 39th Congressional District
In the California State Senate and the California State Assembly, where we need to stop the potential for Professional Service Taxes and need to keep the Independent Contractor status of REALTORS®; we congratulate:
Senator Mike Morrell – 23rd Senate District
Senator Anthony Portantino – 25th Senate District
Senator Ling Ling Chang – 29th Senate District
Assemblymember Marc Steinorth – 40th Assembly District
Assemblymember Chris Holden – 41st Assembly District
Assemblymember Blanca Rubio – 48th Assembly District
Assemblymember Ed Chau – 49th Assembly District
Assemblymember Freddie Rodriguez – 52 Assembly District
Assemblymember Philip Chen – 55th Assembly District
Assemblymember Ian Calderon – 57th Assembly District
That is 15 races in which the REALTOR® Party competed and 15 races the REALTOR® Party won! A 100% victory for REALTORS® We know each of them and we know that they will fight for REALTORS®.
At CVAR we ask you to get involved with the real estate politics that affect your business. Join the advocacy of CVAR, CAR and NAR to keep all REALTORS® protected and nationally recognized. The REALTOR® Party is a powerful alliance of REALTORS® and REALTOR® associations working to protect and promote home ownership and property investment. The REALTOR® Party speaks with one voice to advance candidates and public policies that build strong communities and promote a vibrant business environment. Get involved with the real estate politics that affect your business. Without the advocacy of the REALTOR® Party, victories such as those above would not be possible. We ask you to join the advocacy of the REALTOR® Party by making a contribution to the REALTOR® Action Fund. Your participation will help to ensure future victories.
As Winston Churchill once said: “Many forms of government have been tried, and will be tried in this world of sin and woe. No one pretends that democracy is perfect or all-wise. Indeed, it has been said that democracy is the worst from of government except all those other forms that have been tried from time to time.”
C.A.R. successfully pressed amendments to AB 1381 (Weber) only minutes before the bill’s scheduled hearing in the Senate.
C.A.R. opposed the bill because it contained surprise amendments added during the last allowable day in the Senate, its second house. Those amendments would have created a new exemption to the real estate license and would have permitted unlicensed agents to broker leases, sales and easements for the placement of outdoor advertising.
After considerable lobbying by both sides, which involved administration officials and the entire Senate, the bill was called back to the Business and Professions Committee. C.A.R.’s member mobilization effort forced the proponents to accept the limiting amendments. The amendments ultimately agreed to make the advertising agents’ rule essentially the same as the existing “principals’ exemption” – that is, a corporation can use its own employees to work on its own transactions without having to have them licensed. Any agency or brokerage on behalf of another or a third party still requires a licensee.
Thank you to all the REALTORS® who contacted their state senators to voice their concerns about AB 1381. Your calls made the difference!
The Consumer Financial Protection Bureau has issued new rules aimed at protecting widowed homeowners from a red-tape nightmare that has caused them to lose their homes to foreclosure.
The regulations, announced Aug. 4, 2016, generally give surviving spouses who are not on a mortgage note the same protections that borrowers have. Those include a ban on so-called dual tracking, in which mortgage servicers negotiate with clients to modify a mortgage while simultaneously pursuing foreclosure.
The rules, which expand and clarify existing guidance from the agency, were long awaited by consumer groups that are pushing similar regulations in a pending California Senate bill 1150.
Advocates say survivors — who already owned their homes or inherit them after a death — face considerable resistance from servicers when they seek loan modifications after losing their spouse’s income.
The office of California Atty. Gen. Kamala D. Harris, who sponsored the California Homeowner Bill of Rights, said the passage of SB 1150 would “provide accountability and an enforcement mechanism that ensures California homeowners reap the benefits from these [new federal] rules.”
Often companies won’t allow a modification until the surviving spouse assumes the loan, which can’t happen until the owner is current on the mortgage — something of a Catch-22.
Advocates also say servicers give them inaccurate information or require unnecessary documents to prove ownership of the home when applying for a modification as a foreclosure proceeds.
The new rules, which take effect in about 18 months, seek to address those issues. In addition to banning the dual tracking of survivors, the rules stop servicers from mandating survivors first get current on payments before receiving a loan modification.
Applicants, however, must still show they can afford even a smaller loan payment and servicers are not required to give a modification.
Consumer groups praised the new rules, but expressed concern that they lack a strong enforcement mechanism.
Critics say that servicers have routinely flouted existing requirements for borrowers, but added companies have performed better in California. Critics attribute the better performance to the California Homeowner Bill of Rights, which gives borrowers the right to sue to stop a foreclosure or for economic damages after one occurs if servicers don’t follow state requirements.
The Homeowner Bill of Rights, however, does not apply to survivors or other so-called “successors in interest” who aren’t on the mortgage note.
A bill that would extend those rights to such individuals passed the state Senate earlier this year. The full Assembly is expected to take up the bill, SB 1150, this month.
While the new federal consumer rules give survivors some rights to sue servicers, the ability to bring lawsuits is far more expansive under the pending state bill.
Legislative update, learn about the status of these bills:
AB 790 (Quirk-Silva) Consumer Legal Remedies Act Will help prevent PACE lenders from using technical arguments to evade their obligations when a senior whose home has been put at risk because of a PACE loan seeks relief under the CLRA.
AB 1095 (Cooley) Affordable Rental and Owner-Occupied Housing Adds homeownership opportunities for low-income individuals to the programs that can be funded by the Affordable Housing and Sustainable Communities Program beginning July 1, 2022.
SB 539 (Hertzberg, McGuire, Allen) Statutory Implementation of Proposition 19b Provides necessary clarifications to ensure for proper implementation of Proposition 19’s provisions statewide. These clarifications help ensure Proposition 19 is implemented consistently throughout California, as well as provide certainty to qualifying homeowners and owners of family farms.
Hot Issue Update – C.A.R. Clarifies Pro Act Federal Labor Bill
Earlier this month an “Opinion” article was published in Inman News about H.R. 842, the PRO Act. The PRO Act is a labor bill that touches upon different aspects of the employer and employee relationship. The focus of the article is the possibility that the PRO Act could make changes to the ability of REALTORS® to do business as independent contractors. The opinion piece inferred passage of the bill by the Senate was imminent. “This is simply not the case,” reports C.A.R. “This bill, as currently written, will not achieve the necessary votes in the U.S. Senate to pass.”
This topic, of vital consequence to REALTORS®, is a good example of the work that C.A.R. and NAR do to support and allow you to do business. Both have worked for years to educate members of the Legislature and Congress on the importance of REALTORS® having the choice to be independent contractors or employees.
Last year, C.A.R. was successful in amending AB 5 and, thus, protecting the ability of California REALTORS® to continue their half-century practice as independent contractors. C.A.R. continues to assist and support NAR’s efforts to maintain its members’ independent contractor option as lawmakers debate H.R. 842 and other bills that deal with this issue. We expect to be successful in these efforts. Additional information may be found at:
With the Legislature up and running in full force, CVAR is sharing this update on three CALIFORNIA ASSOCIATION OF REALTORS® sponsored bills. For two of the bills, the focus is to help ensure transparency on the costs attached to housing and housing production. The third focuses on reducing the costs to construct affordable housing.
Direct fees on residential parcels of land have been a growing local government finance tool since the creation of Mello-Roos and the establishment of benefit assessment districts. These districts allow special fees to be imposed on property owners to finance public improvements like park maintenance, water, electricity, sewage and drainage, infrastructure and more. AB 119 would create more transparency for the buyer about these fees before entering into the transaction. It would require the County Auditor/Controller to post the combined direct levies accessed on real property along with the current tax rate on their website. Additionally, if a County Auditor/Controller posts the contact information for each direct levy accessed within their jurisdiction, that notice shall also include a range fees accessed on individual parcels of real property subject to the special district’s assessment.
Home production cost increases are often passed along to buyers in the form of higher home prices. Sponsored by C.A.R., AB 244 would require the state’s housing agencies to update the California Cost Study, last released in October 2014, to provide actual costs to constructing affordable and market rate housing. This transparency of these costs is crucial to solving the state’s housing supply crisis.
AB 571 (Mayes) Density Bonus: Fee Reduction to Construct Below-Market Rate Unit
Fees and costs associated with the construction of affordable units are often passed along to buyers in the form of higher home prices or can increase the amount of subsidy needed to build affordable housing units. Sponsored by C.A.R., AB 571 prohibits local governments from assessing affordable housing fees on the deed restricted affordable units contained within a density bonus application. Affordable deed restricted housing should not be required to pay a fee intended to construct other affordable housing as it simply increases the cost of the affordable housing being built. This fee only serves to increase costs to construct deed restricted affordable housing, making it less likely that developers maximize the affordable unit set aside within their density bonus application.
June 26, 2020
C.A.R. Legislation – November 2020
On June 26 the California State Legislature passed a strong bipartisan measure (Assembly Constitutional Amendment 11) co-sponsored by the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) and the California Professional Firefighters that is poised to be placed on the November ballot. This new ballot initiative is known as “The Home Protection for Seniors, Severely Disabled, Families, and Victims of Wildfire or Natural Disasters Act” (ACA 11).
This is great news as it builds on C.A.R.’s original initiative, strengthening the provisions we care most about and incorporates dedicated funding for fire protection and emergency response to safeguard millions of lives in communities across the state. The new initiative will continue to expand Proposition 13 property tax portability for all homeowners over 55 years old, people with severe disabilities, and wildfire victims by removing unfair location and cost restrictions to allow homeowners to move anywhere in the state. In addition, it will open up housing inventory throughout California, creating home ownership opportunities for first-time homebuyers.
This legislative solution passed through the California State Legislature with two-thirds support in the State Assembly and State Senate with strong bipartisan support. Together, C.A.R. and the California Professional Firefighters built an unprecedented broad and diverse coalition including local elected officials, business groups, labor, agriculture, Republicans and Democrats. Some of the supporters include the California Farm Bureau, California Fresh Fruit Association, California Forestry Association, California Business Roundtable, California Building Industry Association, California Business Properties Association, California Cattlemen’s Association, as well as wildfire victims, local elected officials, school officials, and senior groups.
This updated initiative generates hundreds of millions of dollars in annual revenue for local governments and school districts without raising property tax rates. It also creates a historic dedicated Fire Response Fund providing needed revenue to help protect millions of homes and lives across the state, including dedicated revenue for historically underfunded fire districts in rural and urban communities.
In addition, the initiative will provide added tax relief for California’s family-owned farms and ranches. The additional tax savings for a farmer or rancher will help protect generational farming.
Lastly, the initiative continues to constitutionally protect the right for parents and grandparents to pass the family home to their children and grandchildren so they can afford to live in the home as intended by Propositions 58 and 193. Since family transfer benefits have been under attack and face potential elimination, this initiative protects family homes for Californians.
The next step is for Governor Newsom to sign legislation in the next few days that will officially place ACA 11 on the ballot.
We are in an even stronger position to pass this important initiative that will improve housing affordability, benefit communities, and all Californians. I appreciate your support. Our team will be providing you with updates soon on how to get involved.
Jeanne Radsick C.A.R. President
SB 50: Senate Rejects Transit Density Bill
SB 50, the controversial proposal in the California legislature that would have rolled back zoning requirements in urban areas around transit, fell three votes short of the 21 needed to advance to the State Assembly.
Senate Bill 50 was aimed at scaling back local zoning rules that limit the density of housing near transit lines and job centers. There are reports that the bill could return for reconsideration. But the clock is ticking for Sen. Scott Wiener to collect votes. Under the Legislature’s rules, the bill would need to clear the Senate by last Friday in order to advance to the Assembly.
Speaking on the Senate floor , Wiener argued that restrictions on the scale of new buildings imposed by cities and counties in the last 50 years have exacerbated the state’s affordable housing shortage and smog-producing urban sprawl.
“We have a policy in California that it’s not a priority to have enough housing for those who need it,” said Wiener. “Restrictive zoning puts a hard cap on our ability to get out of this housing crisis.”
Allowing developers to construct larger apartment buildings in areas already well-served by transit, argued Wiener, would also give more people alternatives to driving.
In its current form, SB 50 would reduce minimum parking requirements and density restrictions applied to housing developments near train stations, bus stops with frequent service, and areas with a high number of jobs. Cities would also have to allow up to four units on lots now exclusively reserved for single-family homes.
Local governments would have until 2023 to come up with their own plans to add more housing units and decrease transportation emissions—or abide by the rules laid out in the bill.
Impact for Los Angeles
In Los Angeles, where the bill could impact zoning rules for nearly half the city’s land, the City Council voted unanimously last year to oppose SB 50. Echoing criticisms from affordable housing advocates, local leaders argued that the bill did not do enough to address the needs of low-income renters who would likely be unable to afford newly built apartments without affordability requirements.
The bill has since been amended, and Wiener said the previous week that affordability requirements would be added in the coming months. He also emphasized that the bill includes demolition protections to avoid renter displacement—and that Los Angeles would be effectively exempted from many of SB 50’s provisions due to existing incentives for affordable housing development near transit.
“We’re not all the way on this bill, but we’ll get there,” he said.
Sen. Holly Mitchell (D-Los Angeles) said promises of future affordability measures and anti-gentrification stipulations already added weren’t enough to address the concerns of both renters and homeowners in areas impacted by redlining and other segregationist policies.
“Single-family homeowners are not a monolithic group,” said Mitchell, pointing out that many of the South LA residents she represents own their homes. “We have single-family homeowners that are holding on by their fingernails.”
Wiener spokesperson Catie Stewart says the senator hasn’t “figured out next steps yet” but is “committed to addressing the housing crisis.”
Gov. Gavin Newsom signed two bills into law last week meant to address the housing/homeless crisis. AB 1482 caps rent increases in multi-family structures, SB 330 other limits public hearings on developments. READ MORE
C.A.R. Red Alert – Restrictive Rent Caps
UPDATE – Sept. 10, 2019: Senate Passes 1482 The bill now heads to Gov. Gavin Newsom’s desk; he has said he will sign it.
This bill would, with certain exceptions, prohibit an owner of residential property from terminating the lease of a tenant that has occupied the property for at least 12 months without just cause, as defined.
The bill would require, for certain just cause terminations that are curable, that the owner give a notice of violation and an opportunity to cure the violation prior to issuing the notice of termination. The bill would require, for no-fault just cause terminations, as specified, that the owner assist certain tenants to relocate, regardless of the tenant’s income, by providing a direct payment of one month’s rent to the tenant, as specified. […] The bill would repeal these provisions as of January 1, 2023.
In this case, a “just cause” means failure to pay rent, “substantial breach of a material term of the rental agreement, […] refusal, by the tenant to sign a new lease that is identical to the previous lease, after the previous lease expired,” illegal conduct, damage to the unit, and similar complaints, according to Curbed.
C.A.R. OPPOSES UNLESS AMENDED
C.A.R. has been negotiating in good faith with the bills’ authors in an attempt to make reasonable amendments to both bills, thus removing C.A.R.’s opposition. As of now, those negotiations have stalled. As a result, C.A.R. OPPOSES both AB 1482 (Chiu), which creates a very restrictive statewide rent cap, and AB 1481 (Grayson and Bonta), which establishes statewide “just cause” evictions.
Urge Your Senator to Oppose Legislation that Forces Landlords to Participate in Section 8!
C.A.R. OPPOSES SB 329 (Mitchell) because it effectively forces ALL residential rental property owners to participate in the voluntary Section 8 housing program by entering into a legally binding contract with a government agency – the provisions of which may be extremely difficult to fulfill. SB 329 will be considered as soon as TODAY on the Senate Floor.
Call your Senator TODAY! Urge a NO Vote on SB 329!
Enter your NRDS ID or PIN number followed by the # sign to be connected to your legislator’s office.
When staff answers the phone, you can use the following script: “Hi, this is (insert your name). I’m a REALTOR® from your district. Please ask the Senator to Vote No on SB 329. Don’t force rental property providers into contractual obligations that they may not be able to meet.”
The REALTOR® Action Fund (RAF) and REALTOR® Political Action Committee (RPAC) are lobbying against laws that hurt the real estate industry and make home ownership less affordable for clients.
CVAR is urging members to do their part to fight upcoming legislation that could devastate the California real estate industry.
The work that RAF and RPAC do includes raising and spending money to educate and elect candidates who understand and support issues that are important to our industry. We know that REALTORS® can make a difference. Each year CVAR sends REALTOR® members who support RAF to Sacramento to Legislative Day, sponsored by C.A.R., to meet and educate our legislators about issues impacting real estate.
“California REALTORS® cannot afford to ignore what occurs in the halls of government because Real Estate is one of the most regulated industries at the local, state and federal level,” according to C.A.R.
Support the fight for legislation that helps YOU do business–and your clients get into homes!
CVAR Members Are Making a Difference in Sacramento
Tell a Friend about RPAC / RAF and what it can do for their business during our Phone-a-friend for RPAC / RAF Event.
We had so much fun last month with our first-ever Phone-a-Friend, but if you missed out, we will host our second of three Phone-a-Friend events next week. The two-hour session from CVAR Headquarters, 504 E. Route 66, Glendora, will take place from 9:30 a.m.-noon.
This is an opportunity for REALTORS® to have a direct impact on legislation that affects the real estate industry! If you’re a REALTOR® and want to make a difference now, please click this link!
H.R. 3700 was passed by the U.S. House 427-0. Despite passing with NO OBJECTIONS, the U.S. Senate has not acted on H.R. 3700.This legislation provides significant benefits to taxpayers, homebuyers and the real estate market by:
Removing a burdensome and expensive FHA Condo approval process
Reducing FHA restrictions on the number of condos available to homebuyers
Permanently streamlining Rural Housing Service loan processing
More Information on NAR’s efforts to pass H.R. 3700:
On Tuesday July 5th, The Los Angeles County Board of Supervisors voted to put a measure on the November ballot that would levy a one-and-a-half cent per square foot parcel tax on properties countywide to fund parks development and maintenance.
If approved by voters, the parcel tax is estimated to raise roughly $95 million annually. The annual tax bill for a 1,500-square-foot house would be $22.50.
The board’s vote was 3-1. Supervisor Don Knabe voted against the measure because a sunset clause that would end the tax in 35 years was eliminated. Supervisor Michael Antonovich was absent for the vote.
The Safe, Clean Neighborhood Parks, Open Space, Beaches, Rivers and Water Conservation Measure would replace funding under Proposition A, first passed more than 20 years ago. The last of that Proposition A funding is set to expire in 2019.
Supporters noted that the measure seeks to raise $10 million more than the original Proposition A.
In 2014, the board tried to replace Proposition A funding with Measure P, which fell short of the two-thirds majority needed for passage, with 62.8 percent in favor.
The new measure has a greater needs-based component, though 50 percent of dollars raised will go back to the communities where they were raised.
Advocates said parks are about more than play, citing studies that green space can boost health and help keep neighborhoods safe.
The parks assessment found that about 51 percent of county residents do not live within a 10-minute walk of a park.
The Los Angeles Chamber of Commerce and other business organizations opposed the measure.
A representative for the Motion Picture Association of America warned that the tax could impact future production decisions, saying it would amount to a five-fold increase over what its members currently pay.
Priorities for spending the money — should the measure pass — have been set based on meetings with residents from 188 study areas aimed at identifying each community’s top 10 parks projects. Thirty-five percent of funds will be tagged to pay for those projects.
Another 15 percent will be used to fund parks maintenance in the communities where taxes were levied. Thirteen percent will go to high-needs communities.
Another 13 percent will be used for environmentally-oriented projects, including beach and waterway clean-up; with 13 percent more for regional trail and accessibility projects that connect urban areas to nature.
The balance will go to related job training for youth and veterans and to administrative costs.
Should the measure pass, the county will only have a fraction of the money needed to complete the $8.8 billion in priority projects identified by the area study groups and another $12 billion in deferred maintenance.
A two-thirds majority of November voters is required for passage.
The NAR has filed a petition with the U.S. Patent Office challenging patent infringement claims by companies that demand payment from real estate companies for “old and widely available” technology.
The action was taken to protect real estate professionals who are allegedly being victimized by “patent trolls,” according to the NAR. One company singled out is Data Distribution Technologies (DDT), which has sent letters to real estate companies demanding payment for infringing on its patent. But DDT is considered a “patent troll,” NAR reports, because its “business” is buying over-broad patents and sending “license letters” to users of the products.
“With this action, we’re telling the company and other patent trolls that our industry won’t tolerate these kinds of tactics against innocent real estate professionals who use well-known, ordinary technologies and business methods,” said NAR Associate General Counsel Ralph Holmen. “We intend to help protect members from being forced into cost-of-litigation settlements based on over-broad, invalid patents.”
NAR filed what is known as an Inter Partes Review (IPR) petition with the U.S. Patent and Trademark Office. While the IPR is pending, most courts will stay any related litigation under the same patent. A win for NAR will make it difficult for the company to proceed against other real estate companies with similar over-broad patent claims.
“We’re sending a message to this company, and more broadly to any company that relies on over-broad, invalid patents coupled with illegitimate ‘troll’ patent litigation tactics to make money, that the real estate industry is prepared to fight back,” Holmen said.
The Patent Office’s Patent Trial and Appeal Board is expected to respond to the Petition in about four months.