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AB-2088 Residential real property: Costa Hawkins.(2003-2004)

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AB2088:v95#DOCUMENT

Amended  IN  Assembly  April 13, 2004
Amended  IN  Assembly  May 11, 2004
Amended  IN  Senate  June 28, 2004
Amended  IN  Senate  July 06, 2004

CALIFORNIA LEGISLATURE— 2003–2004 REGULAR SESSION

Assembly Bill
No. 2088


Introduced  by  Assembly Member Dutra

February 17, 2004


An act to amend Section 1954.53 of the Civil Code, relating to residential real property.


LEGISLATIVE COUNSEL'S DIGEST


AB 2088, as amended, Dutra. Residential real property: Costa Hawkins.
The Costa-Hawkins Rental Housing Act authorizes an owner of residential real property to establish the initial and all subsequent rental rates for a dwelling or a unit if any one of specified facts is true and the initial rental rate for a dwelling or unit where a residential rent control ordinance applies, except under specified conditions. Where the original occupant or occupants who took possession of the dwelling or unit pursuant to the rental agreement with the owner no longer permanently reside there, an owner may increase the rent by any amount allowed by the act to a lawful sublessee or assignee who did not reside at the dwelling or unit prior to January 1, 1996.
This bill would, instead, provide that where the original occupant or occupants who took possession of the dwelling or unit pursuant to the rental agreement with the owner no longer permanently reside there, the owner may increase rent by any amount allowed by the act to a lawful sublessee, assignee, or occupant who did not reside at the dwelling or unit prior to January 1, 1996.
Existing law provides several exceptions to the provision allowing an owner to increase the rent by any amount allowed to a lawful sublessee or assignee where the original occupant or occupants pursuant to the rental agreement no longer permanently resides in the dwelling or unit, as specified.
This bill would create additional exceptions to that provision for situations in which lawful occupants in Los Angeles and San Francisco remain in possession of a dwelling or unit, as specified, and for oral leases or oral rental agreements where a lawful occupant, other than a sublessee or assignee, remains in possession of the dwelling unit. The bill would also provide that a rent increase to a lawful occupant that was implemented between specified dates and which was not the subject of judicial proceedings before an administrative agency regulating rents, shall not be reduced or invalidated on the basis that the occupant was not a sublessee or assignee. The bill would make other related changes.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: NO   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Section 1954.53 of the Civil Code is amended to read:

1954.53.
 (a) Notwithstanding any other provision of law, an owner of residential real property may establish the initial rental rate for a dwelling or unit, except where any of the following applies:
(1) The previous tenancy has been terminated by the owner by notice pursuant to Section 1946 or 1946.1 or has been terminated upon a change in the terms of the tenancy noticed pursuant to Section 827, except a change permitted by law in the amount of rent or fees. For the purpose of this paragraph, the owner’s termination or nonrenewal of a contract or recorded agreement with a governmental agency that provides for a rent limitation to a qualified tenant, shall be construed as a change in the terms of the tenancy pursuant to Section 827.
(A) In a jurisdiction that controls by ordinance or charter provision the rental rate for a dwelling or unit, an owner who terminates or fails to renew a contract or recorded agreement with a governmental agency that provides for a rent limitation to a qualified tenant shall not be eligible to set an initial rent for three years following the date of the termination or nonrenewal of the contract or agreement. For any new tenancy established during the three-year period, the rental rate for a new tenancy established in that vacated dwelling or unit shall be at the same rate as the rent under the terminated or nonrenewed contract or recorded agreement with a governmental agency that provided for a rent limitation to a qualified tenant, plus any increases authorized after the termination or cancellation of the contract or recorded agreement.
(B) Subparagraph (A) shall not apply to any new tenancy of 12 months or more duration established after January 1, 2000, pursuant to the owner’s contract or recorded agreement with a governmental agency that provides for a rent limitation to a qualified tenant unless the prior vacancy in that dwelling or unit was pursuant to a nonrenewed or canceled contract or recorded agreement with a governmental agency that provides for a rent limitation to a qualified tenant as set forth in that subparagraph.
(2) The owner has otherwise agreed by contract with a public entity in consideration for a direct financial contribution or any other forms of assistance specified in Chapter 4.3 (commencing with Section 65915) of Division 1 of Title 7 of the Government Code.
(3) The initial rental rate for a dwelling or unit whose initial rental rate is controlled by an ordinance or charter provision in effect on January 1, 1995, shall not, until January 1, 1999, exceed the amount calculated pursuant to subdivision (c).
(b) Subdivision (a) applies to, and includes, renewal of the initial hiring by the same tenant, lessee, authorized subtenant, or authorized sublessee for the entire period of his or her occupancy at the rental rate established for the initial hiring.
(c) The rental rate of a dwelling or unit whose initial rental rate is controlled by ordinance or charter provision in effect on January 1, 1995, shall, until January 1, 1999, be established in accordance with this subdivision. Where the previous tenant has voluntarily vacated, abandoned, or been evicted pursuant to paragraph (2) of Section 1161 of Code of Civil Procedure, an owner of the residential real property may, no more than twice, establish the initial rental rate for a dwelling or unit in an amount that is no greater than 15 percent more than the rental rate in effect for the immediately preceding tenancy or in an amount that is 70 percent of the prevailing market rent for comparable units, whichever amount is greater.
The initial rental rate established pursuant to this subdivision shall not be deemed to substitute for or replace increases in rental rates otherwise authorized pursuant to law.
(d) (1) Nothing in this section or any other provision of law shall be construed to preclude express establishment in a lease or rental agreement of the rental rates to be applicable in the event the rental unit subject thereto is sublet, and nothing in this section shall be construed to impair the obligations of contracts entered into prior to January 1, 1996.
(2) Where the original occupant or occupants who took possession of the dwelling or unit pursuant to the rental agreement with the owner no longer permanently reside there, an owner may increase the rent by any amount allowed by this section to a lawful sublessee, assignee, or occupant who did not reside at the dwelling or unit prior to January 1, 1996.
(3) Paragraph (2) shall not apply to any of the following:
(A) Partial changes in occupancy of a dwelling or unit where one or more of the occupants of the premises, pursuant to the agreement with the owner provided for above, remains an occupant in lawful possession of the dwelling or unit.
(B) Where a lawful sublessee, assignee, or occupant who resided at the dwelling or unit prior to January 1, 1996, remains in possession of the dwelling or unit.
(C) Where a lawful occupant, other than a sublessee or assignee, in the City of Los Angeles, who began occupancy prior to January 1, 2005, remains in possession of the dwelling or unit.
(D) Where a lawful occupant, other than a sublessee or assignee, in the City and County of San Francisco, remains in possession of the dwelling or unit, unless the owner complies with the notice provision in subdivision (b) of Section 6.14 of the regulations of the San Francisco Rent Stabilization and Arbitration Board, as that section existed on May 1, 2004.
(E) Oral leases or oral rental agreements where a lawful occupant, other than a sublessee or assignee, remains in possession of the dwelling or unit.
(4) Acceptance of rent by the owner shall not operate as a waiver or otherwise prevent enforcement of a covenant prohibiting sublease or assignment or as a waiver of an owner’s rights to establish the initial rental rate unless the owner has received written notice from the tenant that is party to the agreement and thereafter accepted rent.
(5) Nothing contained in this section shall be construed to enlarge or diminish an owner’s right to withhold consent to a sublease, assignment, or occupancy of the dwelling or unit.
(6) Notwithstanding any provision of this section, or any other provision of this code, a rent increase to a lawful occupant that was implemented from January 1, 1996, to May 1, 2004, inclusive, and which, prior to May 1, 2004, was not the subject of judicial proceedings or proceedings before an administrative agency that regulates rents, shall not be reduced or invalidated on the basis that the occupant was not a sublessee or assignee.
(e) Nothing in this section shall be construed to affect any authority of a public entity that may otherwise exist to regulate or monitor the grounds for eviction.
(f) This section shall not apply to any dwelling or unit if all the following conditions are met:
(1) The dwelling or unit has been cited in an inspection report by the appropriate governmental agency as containing serious health, safety, fire, or building code violations, as defined by Section 17920.3 of the Health and Safety Code, excluding any violation caused by a disaster.
(2) The citation was issued at least 60 days prior to the date of the vacancy.
(3) The cited violation had not been abated when the prior tenant vacated and had remained unabated for 60 days or for a longer period of time. However, the 60-day time period may be extended by the appropriate governmental agency that issued the citation.