Assembly Standing Committee on Judiciary

Well, good morning, everyone. Welcome to the Assembly Judiciary Committee. And I want to, even though they're not all here, I want to welcome everyone back to the Committee, whether they're returning from this immediate past year or from prior years.

I think all the kind of incumbent legislators have already either been on the Committee or have served previously. And I also want to welcome our new Members, Assemblymember Harabedian and Assemblymember Stefani. Welcome you and welcome the both of you to the Judiciary Committee.

And as is ordinarily the case, we have witness when we have witness testimony. Each witness is allowed up to two minutes each and each side will have up to two witnesses each unless otherwise noted. Additional witnesses should state only their names, organizations, if any, and their position on the bill.

I ordinarily start right at nine, especially when we have an author that's available. We usually start as a Subcommittee. I was trying to wait, hoping we can get quorum before we started. Hopefully this is not a trend for the rest of the year.

We're just one short of quorum, so we will go ahead in the interest of time, out of respect to those that are here on time, we'll go ahead and start as a Subcommittee and as we do proceed with the bills, with witnesses and public comment.

I want to make sure everyone understands the Committee has rules to ensure a fair and efficient hearing in order to facilitate the goal of the hearing as much from the public within the limits of our time. The rules for today's hearings, as is, always include no talking or loud noises from the audience.

Public comment may be provided only at the designated time and must be limited to your name, organization, and support or opposition of a bill before the Committee. Comments on other issues will be ruled out of order and the microphone may be disconnected. No engaging in conduct that disrupts, disturbs or otherwise impedes the orderly conduct of this hearing.

And please be aware that the violations of these rules may subject you to removal from the hearing or other enforcement processes. I'm hopeful that we will not have to amount to any of that as we ordinarily do not have to, as folks are generally very well behaved in this Committee and I appreciate that.

And so we'll go ahead and start with our first bill, AB 238, File Item 1, AB 238, Assemblymember Harabedian. So just get settled in and certainly have any witnesses you have brought up there with you. And you may begin at any time.

Thank you. Mr,

Thank you, Mr. Chair. Good morning. Good morning to the Members of the Committee. Appreciate you being here. Let me just first start by thanking the Chair for the work on this bill and thanking staff.

I thought the analysis was excellent and so I think it really lays the table very nicely. For those of you who know about the fires, for Angelenos, this has been a very difficult time. Probably the worst disaster that we could have ever imagined. Entire neighborhoods have been wiped out.

Blocks where families lived for generations are now just foundations and debris. Schools, small businesses and places of worship that were at the heart of the community are gone. According to Calmatters, Los Angeles County, more than 16,000 structures have been destroyed and 150,000 residents have been displaced.

Many survivors have lost everything and now they face a significant challenge of rebuilding their lives and homes from the ground up. Preliminary estimates from Intercontinental Exchange indicate that more than 1 in 6 borrowers just in the Eaton fire area where I am proud to represent, are at risk of falling behind on their mortgages this month.

Without relief, these mounting financial burdens could trigger a wave of foreclosures, deepening economic instability in communities already reeling from devastation. AB 238, my bill, provides a critical safety net for LA County wildfire survivors.

Under this bill, borrowers can request an initial forbearance on their mortgage payments for up to 180 days with the option to extend for additional relief if needed for up to one year total.

I want to thank the more than 400 financial institutions that swiftly agreed to an initial 90-day mortgage forbearance requiring no documentation to request relief, no balloon payments and other provisions that actually protect the consumer. I would like to also thank the Governor for putting that together as well. That was a critical step.

However, wildfire recovery is a long process. Short term relief is not enough. AB 238 provides clear, accessible support to prevent financial ruin and ensure communities have the stability they need to rebuild. I also recognize, however, that the work on this bill is not done.

I have been meeting with stakeholders and will continue to engage in discussions on proposed amendments. I have committed to amending this bill to include additional documentation requirements and check-ins after the first 180 days of forbearance. I'm also committed and continuing in continuing conversations with industry representatives to address remaining issues such as potential conflicts with GSC guidelines.

As recognition of those conversations, I would note that there is no formal opposition to this bill, just concerns. AB 238 has the support of a diverse coalition including SEIU, Los Angeles County Supervisor Kathryn Barger, the California Apartment Association and The California Professional Firefighters.

The Bill also has 11 principal co-authors and was jointly authored by Assemblymember Jacqui Irwin, who represents the district where the Palisades fire was. Members, these fires have forever changed the lives of my constituents, my community and Angelenos across the county.

Today I ask you to stand with me and allow me and us to continue working with stakeholders to deliver this critical relief. Now I'd like to introduce Rene Bayardo on behalf of Rise Economy and HPP Cares, who will testify in support of the bill.

Thank you.

Thank you, Mr. Chair and Members. Rene Bayardo representing Rise Economy and HPP Cares. Unfortunately, Katherine Peoples, the founder of HPP Cares, was unable to be here this morning, so I'll be reading her testimony on her behalf. I sit before you today on behalf of the thousands of families and small business owners devastated by the recent California wildfires on January 7.

These fires ravaged communities without warning, leaving residents with only the clothes on their backs, forced to evacuate without the opportunity to secure their homes, livelihoods or critical documents. From the very beginning, our HPP Cares counseling staff witnessed the aftermath firsthand at the disaster resource centers in Altadena and Palisades.

HPP Cares is an HCD certified California nonprofit specializing in consumer credit, consumer debt, financial literacy and housing counseling. Now these families face the overwhelming challenge of managing mortgage payments for homes that no longer exist, all while struggling to secure temporary shelter, essentially being required to pay both rent and mortgage simultaneously. This situation is simply untenable.

It is critical that we implement a meaningful mortgage forbearance policy that supports courts rather than penalizes disaster survivors. Assembly Bill 238, the Mortgage Deferment Act, introduced by Assemblymember Herabedian presents a viable solution. This legislation would allow homeowners impacted by wildfires to pause their mortgage payments for up to 360 days without accruing additional interest or penalties.

This kind of long-term relief is necessary to prevent thousands of families from falling into financial ruin. I would ask for your support today. Thank you, Mr. Chair.

Thank you very much. And before we go to public comment, I would ask if the Secretary could take roll please.

[Roll Call]

We have a quorum established and so let's go ahead and go to any public comment. If there's anyone here in support of AB 238. Name organization, if any, and your position please.

Good morning. Matt Lege with SEIU California in support.

Thank you.

Good morning Mr. Chair and Members, Doug Subers on behalf of the California Professional Firefighters in support.

Thank you.

Good morning Mr. Chair, Members, Maria Flores with the Mesa Verde Group here on behalf of the Consumer Federation of California in support of AB 238.

Thank you.

Good morning. Embert Madison on behalf of the California Apartment Association in support.

Thank you. Is there anyone here in opposition to AB 238? I don't know if we have any formal opposition. I know we have folks with concerns, so we'll go ahead and allow you to express those at this time.

Yeah, so just to clarify, we're concerned, not opposition. Thank you Mr. Chair and Members of the Committee. My name is Vanessa Lugo and I'm with the California Bankers Association.

I appreciate the opportunity to talk about a bill that is trying to address the financial hardship caused by the recent Los Angeles wildfires by requiring up to your mortgage forbearance to those who lost their homes in the fires.

While we offer our heartfelt sympathies to those who experience loss due to the LA wildfires, we also have significant concerns with the current version of the measure that need to be resolved in order to avoid unintended ramifications and market disruption.

Even before this measure was introduced, banks and financial institutions were already outreaching and working proactively and constructively with customers to minimize the adverse financial effects of the crisis. Early on, both federal and state chartered banks joined forces with the Governor's office to provide mortgage relief.

To those impacted, the 90 days forbearance of their mortgage payments without reporting to a credit reporting agency and the opportunity for additional relief. While we support the intent of this measure to provide relief to borrowers in need, the concerns we have reflect feedback from the practitioners that would implement this law.

First, AB 238 needs to take into account the different needs of investors in the mortgage market and work alongside existing programs that help homeowners after disasters. These programs are provided by groups like Fannie Mae, Freddie Mac, the Federal Housing Administration, the Department of Veterans Affairs, the USDA Rural Housing Service.

These programs look at each homeowner's financial situation individually, understanding that every circumstances are different after a disaster. By using these well-established rules in 238, the bill would provide better and more consistent help following successful strategies from past disaster recovery efforts.

Secondly, we're also worried that the current version of AB 238 could unintentionally create rules that clash with the investor guidelines and contrast surfacers have to follow.

In the amendments we have suggested, we ask that AB 238 be changed to make it clear that a mortgage servicer who follows the loss assistant programs for investor-owned loans the same way should be considered in compliance with the law. Thank you for allowing me to address our concerns and we look forward to working with you.

Indira McDonald, Mr. Chair and Members, Indira McDonald on behalf of the California Mortgage Bankers Association, also to express concerns California MBA Member servicers have also been actively engaged since the devastating fires and working to serve borrowers who are in need of loss mitigation relief.

We thank the author for the ongoing discussions and commitment to amend the bill at a later time to allow servicers to have check-ins with the borrowers and seek documentation showing their need. However, we do remain very concerned that the bill conflicts with the GSE and investor guidelines which require borrowers meet financial hardship eligibility criteria.

The broad no questions asked state mandated 12 month forbearance period in the bill goes beyond what the GSE insurer and investor agreements allow and could substantially impair servicing contracts. Established guidance for federally backed loans already requires servicers to provide forbearance and other relief options to eligible borrowers.

Servicers do not have discretion to deny such assistance without valid justification and must comply with the respective agency guidelines designed to assist borrowers in need. This is enforced by state and federal regulators. During forbearance, the servicer must continue making principal interest and escrow advances to the investor. Otherwise, servicers are in breach of their servicing agreements.

As drafted, AB 238 creates the risk of servicers getting caught between state law and their contractual obligations to the investors.

We strongly urge that amendments be adopted to avoid a situation where the servicer has to decide operate under the federal GSE guidelines and meet the investor-required borrower criteria, or do they breach their contract with their investors and comply with the state law which requires the broad 12-month forbearance.

In order to avoid creating this type of conflict and resolve the legal issues, we continue to recommend narrowing the bill to align with applicable investor or insurer guidelines or their contractual obligations and expressly state in the bill that servicers in compliance with existing guidelines for borrowers affected by natural disasters would be deemed to satisfy the bill is the amendments that we're requesting. So we continue to thank the author for listening and working with us.

Thank you. Is there anyone else here with concerns about AB 238?

Hi, good morning Mr. Chair, Members of the Committee, Anna Buck with the California Association of Realtors. At this time I'd like to align my comments with those of my industry colleagues.

Further from the realtor perspective, we'd like to see clarifying amendments that would ensure that those who take advantage of any forbearance are not adversely affected by such forbearance. Thank you.

Thank you.

Thank you Mr. Chair and Members. Annalee Augustine here on behalf of the California Mortgage Association echoing comments of concerns and appreciate the conversations. Thank you.

Good morning Chair and Members, Robert Wilson, California Credit Union League. Would like to thank the author for the. Ongoing conversations and align my comments with my colleagues. Thank you.

Thank you. We'll bring this back, Assemblymember Bryan.

Thank you, Mr. Chair. I just want to thank the author. This is your first bill before Committee.

The City of Pasadena, Altadena, your entire district is lucky to have you to step into this crisis and try to figure out how you can do what you can to make things easier for folks who are dealing with the biggest hardship they've ever had to face. This is one of those pieces of legislation. It's people centered.

It inspired the Governor to an executive order. That was your work. You beat him to the punch by introducing this. I'm happy to be a co-author, like to move the bill.

Is there a second?

Seconded by Assemblymember Bauer-Kahan.

I would like to echo the comments of my colleague. I think it's, you know, what your constituents are going through and it's not the first time in the state. We know affects people in the most personal ways.

And when you all of a sudden have no home and you have to go rent a new home and you have to pay your mortgage and that rent, for many people or most people that is an impossibility.

And so the ability to get a little bit of a break on that mortgage so you can get your family into a home, get them back into school, get them settled, I think is not too much to ask. And to the not opposition, you know, I think many of your members have done just that.

And we know that many of our community banks are there to support these folks in this moment of crisis. And I want to thank you for that. We also know that in any sector, not everybody is going to act the way we want them to act. And that's why laws are critical.

I just wanted to note that the bill is double-referred to banking and many of the concerns that were raised in this Committee I think are more appropriate for the banking Committee. Federal and state interactions as it relates to banking laws, having sat on that Committee for years, is incredibly complex.

So I will defer to them on those issues and I'm sure that will all get sorted out there, especially when with the commitment of the author, but I look forward to supporting it today.

And to your point, Assemblymember, I think this was heard in banking yesterday and so it's all being taken into account. And I think there's nothing wrong with restating concerns, but I think those are being discussed with the author as well. Assemblymember Zbur.

So I also want to join in thanking the author for your leadership on this. I think the work that you've done to really address the not just concerns but the needs of your constituents.

My kid's mom lived in Altadina and her house was burned and sort of understand the devastation that happened in that community as well as the one in Pacific Palisades. So, you know, I think this, this bill is, is, is very much needed.

I do want to thank the California Bankers Association, the credit union and the folks with concerns in the constructive approach that you have. You know, you could have come out in opposition to this.

I think I would encourage you to continue working with the author because this is important, I think, to those of us in the Legislature and I think we want something to come through. And so I just want to tell you I appreciate continuing to work with the author to address these. These don't seem non surmountable to me.

So I just wanted to thank you and encourage you to continue doing that.

Thank you. Assemblymember Pacheco.

Thank you to the author. Thank you for bringing this bill forward. I know it's been a tough situation that you were thrust into and so I commend you for being there for your community, for your district, and this bill is a needed bill.

I'm glad to see that you're working with the, I guess not really opposition, but the concerns and I know you've committed it in banking and we've talked about it. And so I just want to commend you for all that you're doing for your district and your constituents. And I'm looking forward to the outcome.

But this is an important bill so I just want to thank you and I will be supporting it today. Thank you.

Thank you. Any other comments? I also want to share in the gratitude and also just the appreciation of this being your first bill and beyond that, just the heavy responsibility you've had to take literally days into your position.

I think those of us that know you have gotten a chance to know you aren't surprised by your ability to be able to do that and not just empathize with your community, but actually bring something so quickly that's going to bring some relief to community members. And so with that, this bill does have an aye recommendation.

We'll go straight to the floor, Appropriations, I apologize. The recommendations go to the Appropriations on this one. And so would you like to close?

Thank you, Mr. Chair, and appreciate all the comments. Would very much appreciate an aye vote. Thank you.

Thank you, Madam Secretary. If we get a roll call on AB 238.

Motion is do pass to Appropriations. [Roll Call]

All right, that bill does pass and is on to Appropriations. Thank you. A motion, is there a second. Motion is seconded. If we can have roll call, please on the consent calendar.

Those bills are AB 78 Chen, consent to the floor. AB 223 Pacheco, consent to the floor. AB 343 Pacheco, consent to Appropriations. [Roll Call]

All right, consent calendar is up. I do want to welcome Assemblymember Chen. Thank you. And you already have a bill passed and you just sat down. Thank you. Appreciate you being in and subbing in today. On to item two. AB 246 Assemblymember Bryan.

All right, settle down. Whenever you're ready, Senator Bryan.

Thank you Mr. Chair and colleagues. I want to start by thanking the Committee staff for their thoughtful work on this bill. Of course I'll be accepting the Committee amendments. I'm proud to be here today to present AB 246. It's an urgently needed measure to stabilize rents in Los Angeles County in the aftermath of the Palisades and Eaton fires.

This bill is sponsored by Housing Is A Human Right, the Coalition for Economic Survival. It also is the first bill that the LA County Board of Supervisors voted to endorse this year. According to data from CAL FIRE, the Palisades and Eaton fires are now the third and fourth largest fires in our state's history, respectively.

It's hard to overstate the ripple effects that these fires have had across our communities. In the blink of an eye, families lost their homes, workers lost their livelihoods, children and teachers lost their school grounds and daycares.

If you were not directly impacted, you likely know somebody who was and is. Thousands have been displaced, and as if the mountains of insurance paperwork are not high enough, they also face a rental housing market that went from unaffordable to downright exploitative overnight.

In an analysis of data from RentCast, the Washington Post found that rent has increased by 20% across LA after the fires even with existing anti-price gouging laws. Angelenos have found nearly 2,000 examples of rental units with a price increase well above the price gouging limit.

These are folks in the community who found these postings that were reposted at exorbitant rates. Our existing laws are not enough to stop bad actors from profiting off of one of the worst disasters in LA's history. With the Committee's amendments, AB 246 will pause rent increases across LA County until March 1, 2026.

Violators will be fined a civil penalty of up to $10,000. Let me be clear, this bill does not apply to any newly constructed or new to market units. Thus, it does not deter anyone from entering the market as a housing provider.

The bill also exempts any landlords who provided notice of a price increase prior to the fires beginning on January 7, 2025. We're in conversations with affordable housing providers and universities. We didn't have enough time to take their amendments, but we will.

This is a measured approach that will stop the artificial inflation of LA's rental housing market from the sudden but temporary influx of new renters, displaced fire victims. It will give workers who have lost their jobs respite to know that at least their rent will not increase while they figure out where their next paycheck will come from.

We're doing all we can to help those who have been impacted by the fires to rebuild and return to their homes. In the meantime, AB 246 will ensure that their desperation cannot be exploited by the rental housing market.

It will also ensure that their temporary status as renters does not mean a permanently altered rental housing market for the 50% of Angelenos who are long term renters. After the 2023 Maui wildfire, Hawaii's unhoused population jumped 87%, according to HUD. We can't afford to see the same outcomes in Los Angeles.

Joining me today to provide testimony are Cynthia Banning and Susie Shannon. Cynthia lost her job after the restaurant she worked at for years burned to the ground in the Palisades fire. And Susie serves as the Policy Director for Housing Is A Human Right.

Thank you.

Good morning. I'm Cynthia Banning. I'd like to thank you guys for allowing me to testify in support of AB 246. On January 7, the Palisades Fire completely destroyed the Reel Inn, a landmark Los Angeles restaurant that I managed.

Once the staff had left that day, only two of us remained on property, equipped with a generator and hoses should the power fail and the sheriff had given us a go ahead to do that. But when the wind shifted, I took a picture of smoke and burning palm tree behind the restaurant, worried of how close the fire was.

We were evacuated by the fire battalion in minutes and in under an hour it was gone. We're more than just employees, we're family, a bond many other businesses lost that day. We're family not only to each other, but also part of our community as their extended family.

Over half of the Real Inn staff have been employed there for more than 20 years. One of our chefs is almost 70, is a renter and was still working full time for the restaurant before the fires. Sadly, most employers probably won't hire someone of her age.

Of the remaining 24 staff members, all but one are renters and still struggling to keep up. There's rent, food, utilities, medical, all to be dealt with and yet still having to go on interviews without tearing up in front of potential employers because everything is overwhelming and we never thought we'd be in this position.

The fires have impacted tens of thousands of people in Los Angeles. My co-workers and I, currently jobless, are struggling to afford significant rent increases. We're all in this together. Soaring rent in Los Angeles is hurting everyone during this crisis. That's why Los Angeles County backs AB 246.

AB 246 provides a one year rent freeze in Los Angeles County, aiding residents struggling with high rent and seeking work or other housing options. We need our elected officials to protect us while Los Angeles deals with the aftermath and devastation of the fires. I ask that you join the County of Los Angeles in support of AB 246.

Thank you.

Good morning Mr. Chair and Members of the Assembly Judiciary Committee. Thank you for this opportunity to give testimony this morning representing Housing Is A Human Right and on behalf of the Coalition for Economic Survival, both co-sponsors of AB 246. I'm Susie Shannon and this is our joint testimony.

Devastating fires have swept through Los Angeles County which have left people without their restaurants and small businesses and forcing many into unemployment and displacing thousands of residents. Following the disaster, some exploited the situation by price gouging and drastically increasing rents while others focused on helping residents recover.

Los Angeles County saw a 20% rent hike in the brief period since the January 7th fire, as reported by the Wall Street Journal. The Los Angeles Times, New York Times and Wall Street Journal are among the news sources reporting on landlords engaging in rent gouging.

Given the devastating fire, substantial losses of housing and jobs and other issues, a one year rent increase suspension for Los Angeles is warranted to allow for recovery.

The County of Los Angeles has voted to support AB 246 as well as members of the Los Angeles delegation of the Legislature who authored and co-sponsored this bill, including Assemblymembers Isaac Bryan, John Harabedian, Mark Gonzalez, Tina McKinnor, Celeste Rodriguez, Sade Elhawary and Senators Ben Allen and Sasha Renée Pérez.

Together they represent a vast swath of Los Angeles, including the areas where the Palisades and Eaton fires were raging, along with the San Fernando Valley, South LA, East LA and Westside of Los Angeles. We are collectively together in asking for your support for AB 246.

Your elected officials and the county is just asking for your vote on AB 246 to enact a temporary rent freeze for the county. And we respectfully ask for your aye vote.

Thank you. And Ms. Banning, thank you for sharing, not just the traumatic experience, but the aftermath I'm sure has also been traumatic in its own way. Is there anyone else here in support of AB 246? Name, organization and your position on the bill only, please.

Good morning. Lizzy here on behalf of the City of West Hollywood, in support.

Thank you.

Amy Cho with the California Teachers Association, in support.

Thank you.

Jovana Fajardo with ACCE, Alliance of Californians for Community Empowerment. Strong support.

Thank you.

Good morning, Mr. Chair, Members. Martha Guerrero representing the Los Angeles County Board of Supervisors here in support, and thanking the author and the Los Angeles County delegation members for their compassionate work in this bill.

Thank you.

Thank you.

Good morning. Matt Lege with SEIU in support.

Thank you.

Good morning. Sung Anderson, Housing Is A Human Right, In support of AB 246.

Thank you.

Good morning. Jesse Brooks, Housing Is A Human Right, in support of AB 246.

Thank you.

Good morning. Lashrea, in support.

Thank you.

Good morning, Mr. Chair and Members. Gregory Cramer on behalf of Disability Rights California, in support.

Thank you.

Good morning. Adrian Placide, in support.

Thank you.

Hello. Vincent Richardson, in support.

Thank you.

Hello. Maurice Harrison, in support.

Thank you.

Good morning. Graciela Castillo-Krings here, a bit of a tweener. We really appreciate all the work that the Assembly Member and his office are doing. I'm here on behalf of the California Housing Consortium, the Affordable Housing Developers Community. Thank you for the support.

Thank you. Is there anyone here in opposition to AB 246?

Good morning Mr. Chairman and Committee Members once again. My name is Embert Madison from the California Apartment Association. We represent over 50,000 rental property owners and property managers in California. I'm here to ask for your no vote this morning and here is why.

First, let me state that CAA strongly opposes any form of price gouging after an emergency is declared. And for this reason, we took out a full page ad in the LA Times after the Jan. 7 wildfires to educate local businesses about the law.

We also have a public education program on our website for tenants, landlords and businesses that they can access at any time.

So while we fully acknowledge and share your commitment to protecting victims of the recent fires from rent gouging in Los Angeles and the surrounding counties, we believe that AB 246 fails to strike an equitable balance between the needs of tenants and the significant financial burdens faced by rental property owners in LA County.

As a testament to this fact, the rent freeze proposal in the City of Los Angeles failed passage. Please understand that Los Angeles did not reject the rent freeze proposal without careful and long consideration. There were multiple hearings with extensive testimony from local stakeholders.

So to now impose a state mandate when the local government declined to do so would be the true definition of state overreach. So while I understand, Mr. Bryan, you now propose to amend the bill with language to apply a rent freeze for one year from January 7, 2025.

From the Governor's declaration, we don't believe a rent freeze is necessary at all. That's because Penal Code Section 396 and its existing rent gouging protections remain in effect in Los Angeles and it already has its own form of rent control. So to state that the bill is not a sweeping form of rent control would be respectfully disingenuous.

It freezes rents in the entire County of Los Angeles and that is more strict than any other local laws. So that we acknowledge that the bill creates a new code section and applies-- I understand that my time is up. I will respectfully thank you for hearing our concerns and ask for a no vote.

Thank you.

Good morning Chair, Members. Berenice Jimenez, here on behalf of the California Association of Realtors. First, I want to acknowledge the author's efforts to protect fire victims from price gouging.

While we fully support efforts to ensure that no one takes advantage of those affected by the wildfires, California already has strong anti gouging laws in place to protect tenants which already prevent frivolous and excessive rent increases in declared emergency zones. Unfortunately, AB 246 as currently written creates unintended consequences that would significantly disrupt the rental market.

This bill limits tenants opportunities to continue their long term tenancies which could be detrimental not just for landlords but also for tenants that desire housing stability.

By freezing rents across Los Angeles County until March 1, 2026, this bill puts landlords in a position where they are unable to adapt to market realities, thus limiting the ability to offer long term stability to tenants which are already subject to price control under state law.

Additionally, the bill would inadvertently impose retroactive civil penalty on landlords who might enter into new good faith contracts prior to the bill's enactment, creating a catch 22 for landlords seeking to retain existing tenants.

AB 246 inadvertently creates liability for landlords even when both the tenant and the landlord agree to renew an existing rental agreement while seeking to account for increased costs related to maintenance of the unit, resulting in confusion, legal uncertainty and undue risk to landlords who are doing their best to provide stable housing for tenants.

Rather than encouraging long term stable rental relationships, AB 246 will inadvertently create an environment where landlords may fill forms to limit their rental options to month to month or avoid entering into long term contracts altogether due to the threat of larger penalties prescribed by the bill.

AB 246 discourages responsible property owners from offering new long term leases which ultimately harm renters who are seeking stability, particularly on already strained housing markets.

Instead of imposing penalties and restrictions that disproportionately impact housing providers, many of whom are small, independent landlords, we should focus on targeted solutions that provide direct relief for displaced individuals while maintaining long term housing stability for all tenants.

Thank you.

We respectfully ask for your no vote.

Thank you. Anyone else here in opposition to AB 246? Name, organization and position, please.

Mr. Chair, Members. Pat Moran with Aaron Reed & Associates, representing the Southern California Rental Housing Association, in opposition. Thank you.

Thank you.

Mr. Chair and Members. Oracio Gonzalez on behalf of California's Business Roundtable, in opposition.

Thank you.

Good morning, Chair and Members. Kate Bell, on behalf of the California Rental Housing Association and the Apartment Association of Greater Los Angeles, in respectful opposition.

Thank you.

Good morning Chair and Members. Adam Regele with the California Chamber of Commerce, in respectful opposition.

Thank you.

Good morning, Mr. Chair, Members. Chris Wysocki with Western Manufactured Housing Communities Association, in opposition.

Thank you.

Trent Smith on behalf of the California Mobile Home Park Owners Alliance.

Thank you. All right, we'll bring it back. Senator Papan.

Thank you, Mr. Chair. Can you hear me?

Well, first of all, I just want to thank you for being here. When I lived in LA, the Reel Inn was one of my most favorites and actually during the fire I had a friend text me and say, may the Reel Inn rest in peace. So I thank you for your years of service there. It is quite an LA institution and so sorry for what happened to it.

So I really do think, and I thank the author, we've had extended discussions here and as you know, I kind of feel that this is really a price gouging bill and an enforcement bill and an accountability bill. And I do think that one of the ways that you enhance the accountability is perhaps increasing the penalties.

I appreciate that you're going to welcome or work on the idea that LA County Council will get involved in enforcement. So we have broader enforcement troops, if you will. But I also think it might be worth it to increase the penalties, put some more teeth into it. I don't think that a rent freeze is the answer here.

I think you're kind of throwing the baby out with the bathwater. And as we talked about, there are good operators. There's those mom and pop landlords.

And you know, the example I gave you was that mom and pop in Long Beach, who was a dry cleaner and their only form of retirement was, you know, that triplex they bought and now you're on a fixed income and you got expenses that are increasing and we got a rent freeze.

And so I appreciate the discussions that we've had about turning this into a cap. I will support the bill if it's a cap. I cannot support a rent freeze. I like the idea of a 5% cap. I know you might not quite be there and that's something that-- and I appreciate that.

I appreciate the ability to work with you on this. It has been a really good experience and I thank you for that. And that's where I am, and that comes as no surprise to you. And I know that you're willing to commit to that. So I appreciate that very much, Assemblymember Bryan.

Thank you and if anyone wants to talk, just raise your hand or get my attention. But I'm doing it in the order that I'm noticing. Assemblymember Harabedian.

Thank you Mr. Chair. And I'd like to thank the author for the quick work on this bill. And I know you're working extremely hard on it. And I will say on the ground, this is a real problem and your bill is addressing a real problem. I talk to my constituents every day and the things that they are experiencing are traumatic.

And just the other day someone said I got really lucky. I got a three bedroom, one bath house for $11,000 a month. And they were surprised that they could get that price because what they're seeing on the market is well above that. And it made me nauseated.

And I understand that there is a real problem in our market in LA County, but throughout the state prior to these wildfires, after the wildfires it became almost untenable. And I will just say that I'm proud to co-author this bill and I do want to move it.

But I will just say on the price gouging laws that are on the books, they are not working. And here's why they're not working. The victims of the price gouging need a place for their kids to sleep. They need a place for their family to get through this next year, two years.

They are not going to turn a landlord in for raising rates above the minimum-- or the maximum under the law because that means they don't get that place to live.

Their kids having a bed is more important than putting a landlord who is abusing the process into a legal system that will take months, if not years to finally actually get some retribution. So on the ground, these price gouging laws are not going to work to address this situation. This is something that is needed. It is short term.

It is not a permanent solution by any means, and it is not a perfect solution. But I will just say as a price gouging, the laws on the books as being the solve to this problem, it isn't working. So, Mr. Chair, thank you, like to thank the author again and I will move the bill.

Assemblymember Essayli.

Thank you, Mr. Chair. Just have a few questions. The proponents have said rents increased by 20% since the fires. What is the source of that? I can't seem to corroborate that.

Yeah, no, I've got the source for you right here, and I can send you the article today.

The source is data collected from Rent Cast, but I can also send you a Google Sheet that was created by Community that shows over 2,000 listings that were posted prior to January 7th, that after the fires erupted and devastated the entire region, were taken down and reposted for several $1000 more per month.

There's also a countywide increase, average of about 20% in my district, which includes West LA, it is significantly higher.

Where's that data from? Like, who holds that data? When you're saying there's a countywide increase, is there a website or agency or someone?

We're happy to send you multiple articles citing those sources. And there are a number of scholars who are working on this work right now as well.

Okay. But there's no, like, database that keeps track of all this.

Happy to send it to you.

Okay, I'll take a look at it. Many times the witnesses referred to price gouging. Do you have specific examples of that?

Absolutely. There's the case that Rob Bonta has already begun prosecution on. But as the Member from Altadena has mentioned, those laws are tenuous, tedious, put the burden on the victims, and are not nearly enough in this moment.

So if criminal price gouging laws don't work, why is your law gonna work? Yours is civil law and it has less teeth. So I'm just confused. If price gouging laws don't work, why will this work?

Because it brings stability to the market, because the rules are understood by everybody. In fact, I don't think all landlords recognize the price gouging statutes on the book and are actually just trying to adjust in the moment as well. They believe there's an affluent tendency looking for places to live that can afford $11,000 a month.

That doesn't mean you should exploit somebody who's lost their home in the Palisades for as much money as you can get them. But again, I don't blame all of the landlords. I think that is why the apartment Association took out an ad to try to educate their folks.

And I respectfully think this law would be the deepest type of education that the market could face.

Okay. My concern is this just appears to be a way to impose rent control, which has been rejected many times. It was referred as rejected by the locals. It's also been rejected by the voters on three separate occasions. It's been put on the ballot for voters in the last three of the four general elections, 2018, 2020, 2024.

Each and every time, voters rejected it by 60%. So it's not even close here. So my question to you is if the voters have rejected this policy, they don't think it's a good policy. They don't think it's going to help. It's going to make things worse. Do you believe in democracy?

I think the voters also voted for the members of the LA delegation and the members who represent the fire torn regions and the surrounding regions.

And after this disaster, I think if the voters had a say, they'd have a say in a lot of the ways that Los Angeles and other parts of the state work in a tragedy.

And I think those voters have asked us to step in to this moment and provide stability to a devastated rental market because affordability, as both your caucus and ours has mentioned, is a top priority this year. It's something that we were already focusing on before we realized that this issue would become untenable for thousands.

Well, I don't, I don't think this policy will work. I think it will make things worse. I think it's not, doesn't take into account the significant costs and burdens landlords have. I mean, you have fire insurance, it's going to skyrocket and how are they supposed to pay that if they can't increase the rent?

So I believe we should be focusing on how to bring costs down across the board, not imposing draconian control measures that just don't work. So unfortunately for that reason I will have to oppose this bill. But I would love to consider and talk about how do we bring costs down.

And I think we should really be talking about fire insurance because that's going to be the biggest cost that's going to be facing most of these landlords here soon. So thank you Mr. Chair.

Thank you. Assemblymember Bauer-Kahan.

Thank you, Mr. Chair. And Mr. Bryan, I want to thank you for this. I think one of the things that over the course of discussions around this bill has been said is, you know, well, suddenly Bryan wasn't affected by the fires.

But I think one of the things you highlighted effectively in your, your testimony and the testimony of your witnesses is that this is a regional issue, that people aren't going to be staying in Altadena where it burned down, but they're going to be moving to surrounding neighborhoods.

And we really need to figure out how to take care of everybody in LA as that rises, especially the people who are on the cusp who will be displaced as result of this.

So I want to thank you for that work, really taking care of the entire community in Los Angeles in the wake of what is devastating, devastating fires. I want to start actually with a question that arose during the hearing that actually is piggybacking a little bit on what both Ms. Papin and Mr. Essayli said, which is.

I'm a little confused by the remedy here. This is judiciary, so let's talk about the remedy. So I couldn't agree more with Mr. Harabedian that price gouging isn't gonna work because you have to bring a case, the case. I mean, that was generous when you said months, by the way.

For those of us that have litigated, we know it will be two to three years, if you're lucky, to get the hearings and everything done. And so that is a real barrier to people in Los Angeles getting relief from price gouging.

As I read the bill, and I could be wrong, so please correct me, this doesn't protect tenants from eviction where they're trying to raise rent.

It's just a civil penalty, which I actually think is confusing to me, because I think if we're trying to protect people, it would be saying that if you tried to raise the rent, you shouldn't be evicted, rather than a civil penalty that would be more effective because the landlord tenant courts are actually a much more efficient tool than civil court.

So community is actually calling for a rent freeze and an eviction moratorium. And if that's something you're interested in working on, I'd be happy to work on an eviction moratorium with you. But I think we're trying to be pragmatic. I think right now there are many steps in calculating whether you have violated the price gouging statute.

You'd have to find the previous rent. You'd have to calculate the 10%. A rent freeze across the board makes violations very, very easy. It's very easy for landlords to understand.

This is about awareness, stabilization, and enforcement, which is why we're also empowering County Council at the local level to get involved with the civil penalties that are going to be assessed under this bill as well.

So I know we're going to hear Ms. McKinnor's eviction protection bill next. I believe that's what that bill does. If I get my bills today right. Oh no, there's an eviction protection bill coming?

Partially. I believe her bill is if you take in a,

Yeah, so it's eviction protection bill. Okay, so. So no, I mean, but I just, I really think this question of the remedy is an important one if we want people to get quick relief. And the civil court, sadly, and this is something this Committee should continue to work on, is not that venue, it's just not.

And so I think, you know, that is, I'm going to support the bill, it isn't going to stop me. But I wanted to put it out there as something that I absolutely think should be part of the conversation moving forward because I don't see this working the way we want it to if you're stuck in civil court. Sadly.

I think in an ideal world, and this is what folks who have been impacted, this is what folks on the ground are echoing for us to do very loudly, is both a rent freeze and an eviction moratorium.

And if I had any realistic belief that that would move through this Legislature, that would be the direction that we're taking.

But we're trying to be pragmatic and thoughtful in the areas that we can move and also, you know, continue to send signals down to the region that we care and local jurisdictions can do more if they'd like to.

To be clear, I'm not here advocating for an entire eviction moratorium. What I'm saying is that if someone were to be in a landlord tenant situation where someone would try to raise the rent above what you negotiate, it sounds like that's still under negotiation, that the protection, the ultimate remedy would be protection from eviction versus civil enforcement.

I just, I guess I don't, I don't see this working as quickly as you would hope.

So I guess that's just feedback on the bill that I think to achieve the goal you want, I think you're hearing from those of us that have been litigators, and I know you live with one, so she would probably tell you the same thing. It is a slow and painful process and one that just doesn't.

And, and the landlord, to their credit, they do move, and this is why people get evicted quickly, but they move quicker. So anyways, that was just feedback on this remedy in this bill as it relates to the rent freeze.

Than, I mean, I did, you know, you and I had conversations around this bill where I, you know, I hear from both of you, from the folks, I'm from NorCal, so, you know, we aren't feeling the impacts of these fires in the same way, obviously.

But I'm hearing from you on the ground that this is a real problem and that our current rent gouging isn't working the way we want it to, which I absolutely believe. And so we need a solution. And, you know, so I respect that. I want to be a part of it.

I have in this Committee and in this body many times been concerned about the small landlords. You know, and I think, again, people don't often see Mr. Essayli and I agreeing all the time.

But as someone whose homeowner's insurance just went up from $2,000 a year to $9,000 a year, I am the first person in this body to talk about the massive increase in cost to homeowners. That is real. It is real in Los Angeles. It is real. Northern California is real all over the state.

And that if you have a mom and pop landlord who is dealing with that increase that was mentioned by our colleague, but also the increased cost of utilities, the increased cost, I mean, there are increased costs across the board for homeowners that there is this tension right now around who, and we discuss this, who should bear that cost.

And it isn't clear to me that it should be a mom and pop landlord. And the problem is, if you start to put that on the mom and pop landlords, then they sometimes are in a situation where they have to get out of the market, they can't rent anymore.

And the last thing we need in this state is less single family homes on the rental market. There already are too few of them. And so I think it is really critically important that this bill anticipates that problem, that it allows for them to not absorb all of those costs over the next year.

And it really makes sure that we are protecting those, both those landlords, but also those properties that could leave the rental market if people are put into a situation where they all of a sudden have a $7,000 cost increase that they cannot absorb.

And so I just want, you know, to know that I have your commitment on working on that as well.

Of course, the. We have not had a sit down yet. I suspect after Committee that we will, and I'd like to. I think there's a lot of conversations that could and should be had around this.

And I think we share the same values of wanting to protect, particularly mom and pops and folks whose retirement are dependent on their rental property incomes, but also the tenants who are not in danger of being out of the market, but out of a roof over their head and on the streets.

Thank you so, you know, I know as this body focuses this year on affordability, which is our number one priority, we are trying to dive it down in every way. And I, we will do our best. The Federal Government is going to put every hurdle in our way of driving down affordability for everyday Californians.

I know I have your commitment on that work and this work as well. And I will say before I turn the mic over, I really hope the opposition will work with the author. I mean, this is, as you are hearing from all of us, we believe these people deserve protections.

We believe not every landlord in LA is gouging people, but that there are many that are and that the remedy on the books isn't sufficient and that what the author is trying to do is absolutely in line with the values of the majority of this body.

And so I understand, you know, we all have concerns with the bill in print. I will say he has already shown an incredible willingness to amend the bill. I mean, going from one year from the end of the declaration of the emergency to a year period is enormous movement.

And so I think he has shown a willingness to work and I don't know that we've seen the same thing from the opposition. And so that in large part is why I'm, you know, supporting the bill to continue moving so that those conversations can happen and we can find the middle.

I think that is always the goal, find the way to protect the tenants and the landlords, especially our mom and pop landlords who need to keep the roof over their head. So I am happy to support it today, but we'll be expecting that work before I commit to voting on the floor. Thank you.

Thank you, Assemblymember Zbur.

So thank you Assemblymember Bryan, for, for bringing the bill. I absolutely think that there are circumstances out there where we've got price gouging at astronomical levels. And so I know that that's sort of what you're trying to get at. And thank you for that.

As we discussed this morning, I also have some questions and concerns about the bill in part due to some of the questions that my colleague to my right raised related to mom and pop apartment owners. I got about, I think 80 calls and emails about those apartment owners.

And most of those are apartment owners in my district that are actually subject to the rent control laws.

And so I think the valid points they're making are ones related to how this intersects with rent control, where you actually have a very delicate balance of the apartment owner and the renter being subject to, you know, predictable rent increases that go through the rent control board.

And then when this freeze goes into effect, it essentially pushes off sort of that balance to another year. And it's unclear that they would actually be able to, you know, double the rent control the next year. And obviously that raises whole issues about whether or not that makes, you know, meets the rent control goals of rent stabilization.

So I'd like to ask you to sort of think about the interplay with rent control, whether or not the rent controlled units actually need to be in the program.

And then the other issue that was raised that I think is a valid one is, and I couldn't tell this may be addressed already by the bill, but I had two landlords that came to me who had actually were under rent control.

They've renovated the unit because they had a vacancy and put a substantial amount of money with the understanding that they'd be able to go to market rent when it comes back up.

And if this came into place, at least their view is that they'd actually have to go to the prior rent which didn't allow them to absorb all those renovation costs. So that's something to specifically if rent control units remain in this.

And then the third thing I think is I agree with the issue of the caps. I think that the benefit of this bill on the one side is really just sort of the predictability for the year, period of time that's out there.

And I wonder whether it really has to be a freeze because, you know, especially landlords that are barely getting by or who are, you know, relying on this for their retirement, you know, to pay for themselves, they are facing things like huge insurance costs.

So I would ask you to sort of, you know, I'm aligned with the Assemblymember Papin in terms of asking you to reconsider that. I'm planning on voting for the bill today to give you time to work on this. I know that it's a work in progress and appreciate.

But I do think, you know, the need to address, to address the issue of these massive amounts of rent that people are charging for houses that are being put on the market is a real one. I mean we're hearing about it all the time. It's not just the few cases in the paper.

And so I also encourage you to work with the opposition. So thank you.

Yeah, no, and thanks to your advocacy, Assemblymember Zbur, we definitely have new units to the market in the bill, but we can definitely clarify that what new to the market means, unless that renovated unit was put on the market January 7th for one price taken down and then reposted for several thousand dollars more.

I think there's a way that we can address this. And happy to have those conversations, whether it's a freeze or, or a cap, the predictability, the stability, both for renters and for landlords, I think is what's important here. And happy to continue those conversations.

Yeah, I think there's a way to thread that needle. I think that's a unique situation, but a pretty dramatic one for those going through it, I'm sure. Assembly Stefani.

Thank you, Mr. Chair, and thank you, Assemblymember Bryan, for bringing this bill forward. I know this has been talked about as a regional issue, but I really think it's a California issue and an issue for any sentient being that has empathy for anyone. And to the witnesses here today, I'm sorry for everything that you've gone through.

I find it just absolutely tragic to what's happened to everyone in LA, and I also find it despicable that there are people that are out there that would take advantage of those that are struggling to recover from these devastating fires.

So I know that the bill is an attempt to correct that and I do want to associate my comments with that of Assemblymember Bauer-Kahan in terms of the small property owner piece.

I know we haven't had a chance to really talk that through, but being from San Francisco, I have seen that play out a lot in terms of we're trying to protect tenants rightfully and at times we forget that there are small property owners out there that are also struggling with those rising insurance premiums or whatever cost there may be.

So I am happy to support the bill today to move it forward and to make sure that we are addressing those concerns.

I think we can get there, I think that we can all work together, but again, I think just trying to address the absolute devastation and those that would take advantage if the price gouging laws aren't working timely enough, let's try to find something that will work.

So thank you for bringing it forward and again happy to move it forward today and hopefully we can find a solution to the concerns that I've brought up in terms of small property owners.

Assemblymember Connolly.

Thank you Chair, good morning. Really appreciate the discussion this morning. Thank you to the author for your work in the whole LA delegation, for doing the work you are on behalf of your communities and we are right there with you on the devastation that everyone has suffered. I guess I have a question.

I wanted to go back to some of the points raised by Assemblymember Bauer-Kahan, especially around eviction control.

So just so I kind of understand what's happening on the ground there, my sense is the issue at hand here, and I think the bill directly addresses it, is folks who have been displaced from their homes or units because of the fire going out to a very impacted market now and oftentimes finding rents that are now jacked up.

To me, that seems like a different situation than people being wholesale evicted from units that they're already in that haven't been burned down, let's say.

So I guess I would push back on, unless you want to kind of make the case why would eviction control happen or help the situation here as opposed to kind of directly addressing this price gouging and enforcement issue? Is there, are there more evictions going on as a result of this? Just more broadly?

So I think this bill is not going to touch on evictions.

Yeah.

But I do think you could definitely make a case. I mean, the market is so wildly variable right now.

We are hearing stories of landlords raising the cost of parking and certain other things to try to push out existing tenants ahead of lease renewals in anticipation that the floor for the market has now risen and that there are more affluent prospects who are out there.

I think that evidence isn't nearly as clear yet as the evidence of the immediate increases for properties that should be for displaced people or others who were not impacted by the fires, who were looking for rental units in Los Angeles. So I think that is the clear example. That is what we're trying to address here.

But I don't, I don't want to completely discount what the Member from the Bay Area mentioned in terms of, you know, eviction conversations and eviction being a part of this. I think when we're thinking long term, that's where we're headed.

And I think what she was ultimately saying is that the civil penalties may not address this the way that we would like to. And I think we're open to all of those.

I think that was a point well taken and I'm certainly, yeah, I'm open to the discussion. Just was kind of focusing on the task at hand. Yeah. In terms of that, I guess the question is kind of scope and scale of this. So we're now proposing one year.

We know that recovery really is going to take probably 5, 6 years for people truly getting back into their homes. Possibly, but certainly multi year.

So time frame, one year sounds reasonable, but with that backdrop and then two, is it covers all of LA County, so maybe talking about that, you know, the, the west side, the hills were affected, but this would presumably go out to Claremont. Right. I mean, so what, what's the thinking on that as well?

Is it just the practical way or is that the real impact that we're seeing is countywide at this point?

Yeah. So the one year we've done, a year from the day that the fires were put out and do I think that's enough? I'm not sure. I think we're going to learn a lot during that year. I think it's going to inform us.

I think in general, I agree with much of the conversation about rising costs on mom and pop landlords and others. And so we're trying to address this problem and also be pragmatic.

There are a lot of affordability challenges with people attaining and keeping their housing, and I don't think you can address all of those with the rent freeze. I think we've got our work cut out for us in many, many different ways, increasing wages and so many other fights that we can and should have.

The reason that we have gone countywide is, is because the ripple effect is that far. It is the west side to some degree.

It also goes all the way out to Altadena, Pasadena, and we have a strong suspicion that those folks are not going to be able to move west in search of rental units because they will already be priced out, which is going to spill over to the furthest edges of LA County, if not push folks out of the county altogether.

We've got to get our hands around this. We've got to move with some urgency. We've got to bring some stability and reliability.

There are folks who have lost absolutely everything, and at their greatest moment of need, they are finding a rental market that many could have told them was already difficult, but has now proven to be outright hostile towards them.

No, I appreciate that. And then finally, would like the continued discussion around mom and pop as well. So appreciate that.

Thanks. You have my commitment to continuing all conversations. As I mentioned before, we haven't had a conversation yet, but our door is always open and willing to have that conversation and looking forward to it.

Thank you, Assemblymember Bauer-Kahan.

I just wanted to clarify my point because I felt like it was getting lost. So in Assemblymembe Bryan's conversation with me, he used the example that I thought was a fabulous one. Someone not in the City of LA Proper, in one of these 54, 58 cities whose lease comes due. Right.

So their lease is up, the rent can be raised at that point, it's up I think you said 40% in your part of LA. That tenant then has the landlord attempt to raise their rent 40%. What I was suggesting in that circumstance the best remedy for that tenant is to say, nope, not raising it.

You can't evict me. Right. I actually think that is an incredible protection that a civil penalty is not as quick. So that was the point I was trying to make. Now, I do understand that doesn't help those that are trying to get into the market as much as a civil penalty.

But I think that like that scenario feels real to me at a time when people can raise rents to $11,000 that people are going to try to either raise on current tenants where there's no rent control, or constructively evict them. Right. By raising it so high.

And so for those folks, I just think there really is something to be thought about what the best remedy is.

And just before she clarifies, was not suggesting that the rent could be raised 40%. Was suggesting that the average rents in the surrounding area are as high as 40%. So if you don't stay and you're looking for another place, you can't. There's nothing for you. In the example that you and I talked about.

And to clarify there, under current statute and civil penalty. Sorry, penalty 396. First of all, there is already in statute a cap of 5% plus CPI if you go above, for single family homes.

Pardon me, not for single family homes.

Correct. It depends. Right.

Correct, which only the state.

Yeah. And then that one is 10%, I believe, or a little bit higher. But also just our big concern right now is that this bll, and we. Appreciate the member for his amendments. But Mr. Chair, our concern is that our, this bill.

I don't know if there's a, a question that's been posed, but I think you made the point that there are already other protections in place or, or, you know, for renters under certain circumstances. So appreciate that. Thank you.

But having read and voted on that bill, there were many protections put into that Bill for landlords that don't own. I think it was three units and single family homes and other things that I think are absolutely the subject of this bill that the author is trying to target.

If there's no other question. A couple comments. One is that I think that on the point that was raised by some Connolly is why it may not be extended longer, though I think that especially in the scenarios where folks are quickly taking it, they just listed it January 1st.

They quickly took it off and jacked it up 20,000, whatever it might be, and they have to reset it. The anti-rent gouging laws will be in place by the time they reset it for the following year. So I think this period of time is critical to do kind of a level set to ensure that doesn't occur.

So I think that although well taken, I think that there will be other laws that we hope will be enforced and at least folks will have access to similar to the civil penalties aspect.

Look, if someone's intention to do this is to really raise rents dramatically and not only will they not be able to do that, but hit several severe penalties and it will be kind of across the board, I think it makes it very clear and I think the clarity is important, especially given the relatively short timeframe that it would be in place.

And I think Assemblymember Stefani really spoke to, I think the underlying issue here was empathy. And if you're going to have legislation that's going to be led with empathy, I can't imagine a better author than we have before us. And yes, we certainly should allow folks to be able to adapt to market realities.

But right now this is a situation where we have to protect folks from the market because of the emergency and the catastrophe that occurred. This is not normal circumstances. And some folks, not all landlords, but some folks are taking advantage of the fact that we're in this, this really chaotic and tragic moment in time.

I note that in the arguments, the opposition it mentions, protecting tenants and ensuring housing availability requires a balanced approach that considers the needs of all stakeholders, not just one side.

And although that is true, as someone that was born living in affordable housing all the way to a point now where you know that because of the work of my father as an immigrant where we would be classified as small landlords, I can, I can certainly say that not each side is equal and we have to recognize that tenants are.

It's not. This is not a normal, just business transaction that although there may be money at stake and it needs to be very, especially for small landlords, that has to be very seriously considered. The other side has a roof over their head at stake.

And so I think there is a public policy reasoning for us to give grave consideration, greater consideration to those that would literally be losing their home in the same way that we just a few moments ago showed great compassion, understandably so for those that own homes and mortgage forbearance, I think that we need to show that same empathy and compassion in a way that makes public policy sense.

As Assemblymember Bryan says, hey, we could do a lot more things, but we've got to find some kind of balanced approach that recognizes that, yes, landlords also have some expectations and some sense of responsibility to all parties.

But at the end of the day, I think that you're talking about one year, you're still going to get your rent. It's just a matter of not only inordinately increasing it, but just pausing it for one year to allow those that have lost, in many cases their jobs have lost economic opportunity.

If you go to the Palisades, certainly I think most people that work in the Palisades didn't live in the Palisades. And so although they may not lost a home, they lost every ability for them to take care of themselves.

And so I think that where this legislation is is reasonable, and I appreciate the Assemblymember from being willing to talk further with folks on some of the scenarios that were brought up to ensure that we're not inordinately penalizing those that may be in unique circumstances as landlords.

But that being said, I think that this does strike a good balance and it's the least we can do for those that are suffering right now throughout the LA region. And I think everyone in this state should have equal concern as the LA delegation in that matter. With that, would you like to close?

Yeah. Thank you for your comments, Mr. Chair. What happened at the top of this year has been devastating, I think, to all of California, particularly to the LA region and especially to the City of Altadena or to Altadena and the City of Los Angeles.

In the ripple effect, we have seen tens of thousands of teachers who have lost their home. That's why CTA is in on this bill. We have seen thousands of home care workers and classified school employees and others, which is why SEIU is in support of this bill.

We have seen an influx of employees at UCLA who live east of UCLA who are scared of this current rental market. That is why AFSCME 3299 is on here. We have seen this region wide, which is why the County of Los Angeles moved this as their first bill of support this legislative cycle. People have lost everything.

And at that time when they lost everything and they couldn't pack up their belongings, they took go bags and left some of their most prized and valuable possessions, only to find that their whole home was gone. They have walked into a rental market that has tried to exploit that crisis. And that's not just the folks in Altadena.

That is the folks of the Palisades who have entered into bidding wars in some of these properties because we allow that to happen, because we are allowing them to be exploited at a time of tremendous grief and at a time of tremendous loss.

It is also having a spillover effect to half of Los Angeles who were already renters. We know that if we are going to address affordability, the number one thing we are told is housing costs. And that's not people telling you that the cost of producing housing is too high.

That's people telling you that the cost of their roof over their head is too high. And right now in Los Angeles, not only is the rent too damn high, it is exploitatively high. And we can and should do better. It's what the people sent us here to do.

It's what many of us in the LA County delegation are looking to do in this moment. And I respectfully ask your aye vote.

Thank you, Madam Secretary, roll call on AB 246, please.

Motion is due pass as amended. [Roll Call]

All right, that bill is out. Thank you. Assembly Member Bryan.

Thank you, colleagues.

And as Assembly Member McKinnor makes her way up, I think the--Madam Secretary, if we can--I think Assembly Member Connolly, if we can do the add-ons now.

Consent for--consent for Connolly? Connolly for consent. Connolly, aye.

All right.

Item One: AB 238: Harabedian. [Roll Call].

May I have a vote change on that? Not voting to aye?

AB 238. Sanchez, not voting to aye.

Okay, I think we're all caught up. Unless there are any vote changes, we can proceed. Assembly Member McKinnor. Please. We have--we have a motion and a second. Assembly Member McKinnor, you may proceed.

We love your shoes.

Thank you. Uh oh, everybody's looking. Okay. So are we ready?

Yes.

Mr. Chair, members, AB 311 is joint author with Speaker Rivas and would allow a tenant to temporarily house a person or family and their pets displaced by a declared state of emergency.

Members, the January 2025 Los Angeles County wildfires destroyed 18,000 structures, displaced over 150,000 people, many of whom continue to struggle to find stable housing amidst California's ongoing housing crisis.

For many displaced individuals, temporarily moving in with families or friends is an ideal solution, but friends and family who are renting might not have the flexibility in their lease that they would allow guests for longer periods of time, allowing subleasing or allowing additional tenants to be added or removed.

AB 311 provides an opportunity--I'm sorry--provides an important option for displaced residents and their pets to temporarily reside in a friend or family member's rental home, offers these family time to heal from this devastating natural disaster, and begin the process of rebuilding their lives from the ashes of the January fires.

I appreciate the constructive conversation my office and I have had with stakeholders on this bill and remain committed to the final language that protects tenants and engage landlords to protect these vulnerable residents from homelessness. Here to testify in support is Embert Madison with the California Apartment Association and Martha Guerrero with the County of Los Angeles. Thank you.

Thank you. There's already a motion. All right. It's a lot of excitement for this, moving this bill. We've had three or four motions already. Yeah, please.

Good morning, once again. Embert Madison from the California Apartment Association, and we're here to happily support AB 311. We represent over 50,000 rental property owners and property managers throughout the State of California, and AB 311 would reinstate provisions of a previous California law to allow a person at risk of homelessness as well as their household pet to move in with a friend or family member who is a current tenant.

Many people displaced by the catastrophic fires in Los Angeles need temporary housing options as they work to get their lives back in order. Temporarily moving in with a friend or family member is a helpful solution. CAA would like to thank the author for drafting legislation that deftly balances the rights and responsibilities of both tenants and landlords. So we would respectfully request your aye vote.

Thank you.

Good morning, Mr. Chair and members. Martha Guerrero, representing the Los Angeles County Board of Supervisors, and the devastation by the 2025 Los Angeles County wildfires is unprecedented on several levels. In January alone, ten fires burned over 50,000 acres, taking nearly fully a month to contain.

The economic impact is staggering, with losses projected to exceed 250 billion, making this one of the costliest natural disasters in U.S. history. Beyond the numbers, these fires have displaced thousands of families that you have discussed earlier, many of whom are struggling to find temporary shelter in an already strained housing market.

And I want to thank Assembly Member McKinnor and Speaker Rivas for introducing AB 311, which would prohibit evictions of tenants who choose to shelter wildfire victims or their pets. If passed, this bill will create a temporary eviction exemption, ensuring those who open their homes to fire survivors are not punished for their generosity.

As we embark on our long road to recovery, we must ensure that our actions do not exacerbate our housing and homelessness crisis. Solving one emergency cannot come at the expense of another. AB 311 is a crucial step in our efforts to provide stability for those affected by the fires while protecting the tenants who step up to help.

We cannot allow technicalities in lease agreements to prevent the people--to prevent people from helping their neighbors in times of crisis. AB 11 also equips the county with a vital tool to mitigate the broader housing challenges we face. By providing this temporary exemption, we reinforce our commitment to compassion, resilience, and community-driven solutions, and I urge your support for AB 311 to protect our residents, preserve housing security, and strengthen our collective recovery efforts.

Thank you. Is there anyone here in support of AB 311? Just name, organization, your position on the bill, please.

I actually have a bit of a tweener position if you'll allow for a brief comment. Thank you. Lizzie Cootsona, here on behalf of the Humane World for Animals, formerly known as the Humane Society United States, and our colleagues at the American Society for Prevention of Cruelty to Animals. I really appreciate the intent of this bill.

We do have some concern around the non-refundable fee language for tenants with pets, so want to continue conversations with the author's office, but appreciate it. Thank you.

Thank you. Anyone here in opposition to AB 311? All right, bring it back to the committee. It looks like we already have a motion on the table. Any further comment or questions?

Yeah, I just want to, I want to thank Assembly Member McKinnor in joining with other colleagues from the LA area and taking quick action to recognize the broad range of issues that are affecting the housing and those at risk of homelessness, and so I think this is very, certainly a unique situation that I think now is probably happening pretty pervasively throughout the region as people are just trying to find a place to rest their head and, and bring their pets with them and what have you, and so I appreciate all the landlords that are showing the flexibility to also allow for those arrangements as well. Would you like to close?

Yes. I really appreciate the partnership with the California Apartment Association as well, and I'm committed to work with some of our advocates and our community members to keep moving this bill, and so as you guys know, it's just, it's just comforting for someone to be able to go live with a family member or a friend instead of a cold hotel room, and so this bill is really important to Los Angeles County, and so I thank you and urge an aye vote.

Thank you so much, Assembly Member. Madam Secretary, please take a roll call, please, on AB 311.

Motion's do pass. [Roll Call].

Congratulations. Our first unanimous vote of the year. The bill's out. We are adjourned. Thank you.