By Michael D. Belote, Esq.
CMA Legislative Advocate

Crunch Time Ahead in Sacramento

The calendar year may be less than half complete for 2023, but it is much later according to dreaded legislative time in Sacramento. As of this writing, only ten weeks of legislative activity remain for this year. This is a time to be wary, as some groups begin their legislative program as the fall recess approaches. Some people like surprises more than others, but legislative surprises are almost never good!

CMA is presently monitoring 123 different pieces of legislation for the year. Thankfully, some of the worst ideas appear to be dead for the year. But like the undead, ideas in the Capitol have a way of coming back to life through bill amendments, so caution is the watchword.

One issue which fortunately has not reemerged this year is a foreclosure proposal contained in last year’s SB 1323. That was the bill which would have mandated a second track during the nonjudicial foreclosure process, wherein the trustee would have been required to obtain an appraisal of the property, engage a broker and list the property on the MLS, receive bids and sell the property, all without the consent or involvement of the owner. The bill was stopped last year on the Assembly floor, very close to reaching the Governor’s desk. As time remaining in the legislative year grows shorter, it becomes harder to amend last year’s concept into a current bill, but still every amendment to every bill must be read to make sure. The following very briefly summarizes selected key bills, dead or alive:

AB 12 (Haney): Security Deposits. Limits security deposits for residential property to one month’s rent. Passed Assembly, pending in Senate.

AB 475 (Mathis): Foreign Ownership Land Near Military Bases. Prohibits ownership or interests in property by foreign governments or entities which are foreign government controlled within 50 miles of military bases. Died in Assembly.

AB 743 (Petrie-Norris): Remote Online Notarization. Sponsored by the California Association of Realtors, would authorize “RON” in California. Failed to be passed by Assembly Appropriations Committee.

AB 919 (Kalra): Sales of Residential Rental Properties. Similar to proposals in previous years, would have enacted burdensome rights of first refusal prior to selling residential properties containing tenants. Died without hearing in Assembly.

AB 968 (Grayson): Residential Property Disclosures. Requires special disclosures when selling residential properties held for less than 18 months, relating to improvements, contractors and permits. Passed Assembly, pending in Senate.

AB 1033 (Ting): Separate Conveyance of ADUs. Permits separate conveyances of ADU, by recording condominium maps, after either satisfying all liens or obtaining the permission of lenders. Passed Assembly, pending in State.

AB 1218 (Lowenthal): Demolition of Residential Units. Expands upon existing limitations on demolishing residential dwelling units. Passed Assembly, pending in Senate.

AB 1333 (Ward): Bundled Sales. Would have prohibited bundling two or more residential properties for sale. Died without hearing in Assembly.

AB 1532 (Haney): Office Conversions. Would have made conversions of office buildings into residential housing units a “use by right,“ including expanding the ministerial approval process under CEQA. Died without hearing in Assembly.

ACA 10 (Haney): Fundamental Right to Housing. Would amend the California Constitution to declare that housing is a fundamental human right. Pending in Assembly; as a proposed constitutional amendment, this measure is not subject to the deadline applicable to bills.

SB 33 (Glazer): Commercial Financing Disclosures. Extends the sunset date on the requirement to provide specific disclosures in commercial financing transactions. The law being extended excludes commercial financing secured by real property. Passed Senate, pending in Assembly.

SB 224 (Hurtado): Foreign Ownership Agricultural Land. Prohibited foreign government ownership or foreign government-controlled ownership of agricultural land in California. Held in Senate Appropriations Committee.

SB 455 (McGuire): States of Emergency-Mortgage Servicers. Prohibits transferee mortgage servicers from dishonoring written agreements between borrowers and prior servicers and holders of notes concerning property repairs for losses caused by natural disasters in declared states of emergency. Passed Senate, pending in Assembly.

SB 460 (Wahab): Rental Applicants-Criminal History. Would have enacted broad prohibitions against inquiring about criminal records of applicants for rental housing. Died without hearing in Senate.

SB 478 (Dodd): Hidden Fees. Adds provisions to the Consumers Legal Remedies Act for false advertising which does not disclose all mandatory fees. CMA is working with a coalition of lender groups to obtain an exemption from the bill since the Consumer Legal Remedies Act presently exempts REBs and CFLs. Passed Senate, pending in Assembly.

SB 696 (Portantino): Remote Online Notarization. Sponsored by the RON platforms, including Notarize and DocuSign, this bill would authorize the use of RON in California. Passed Senate, pending in Assembly.