BILL NUMBER: AB 1217 CHAPTERED BILL TEXT CHAPTER 766 FILED WITH SECRETARY OF STATE OCTOBER 11, 2003 APPROVED BY GOVERNOR OCTOBER 10, 2003 PASSED THE ASSEMBLY AUGUST 21, 2003 PASSED THE SENATE JULY 17, 2003 AMENDED IN SENATE JULY 1, 2003 AMENDED IN ASSEMBLY MAY 14, 2003 AMENDED IN ASSEMBLY APRIL 21, 2003 INTRODUCED BY Assembly Member Leno FEBRUARY 21, 2003 An act to amend Sections 7060 and 7060.1 of the Government Code, relating to rental property. LEGISLATIVE COUNSEL'S DIGEST AB 1217, Leno. Rental property: residential hotels. Under the Ellis Act, public entities generally are prohibited from adopting any statute, ordinance, or regulation, or taking any administrative action, to compel the owner of residential real property to offer or to continue to offer accommodations in the property for rent or lease. The act defines accommodations subject to the act to mean either residential rental units in any detached physical structure containing 4 or more residential rental units or, with respect to a detached physical structure containing 3 or fewer residential rental units, the residential rental units in that structure and in any other structure located on the same parcel of land. This bill would exempt guestrooms or efficiency units within a residential hotel, as defined, from the above described prohibition if the hotel is located in a city and county, or in a city with a population of over 1,000,000, has a permit of occupancy issued prior to January 1, 1990, and the hotel did not send a notice of intent to withdraw the accommodations from rent or lease that was delivered prior to January 1, 2004. The act provides that it does not diminish or enhance any power in any public entity to mitigate any adverse impact on persons displaced by reason of the withdrawal from rent or lease of any accommodations in any defined residential hotel. This bill would, instead, provide that the act does not diminish or enhance any power in any public entity to mitigate any adverse impact on persons displaced by reason of the withdrawal from rent or lease of any accommodations. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 7060 of the Government Code is amended to read: 7060. (a) No public entity, as defined in Section 811.2, shall, by statute, ordinance, or regulation, or by administrative action implementing any statute, ordinance or regulation, compel the owner of any residential real property to offer, or to continue to offer, accommodations in the property for rent or lease, except for guestrooms or efficiency units within a residential hotel, as defined in Section 50519 of the Health and Safety Code, if the residential hotel meets all of the following conditions: (1) The residential hotel is located in a city and county, or in a city with a population of over 1,000,000. (2) The residential hotel has a permit of occupancy issued prior to January 1, 1990. (3) The residential hotel did not send a notice of intent to withdraw the accommodations from rent or lease pursuant to subdivision (a) of Section 7060.4 that was delivered to the public entity prior to January 1, 2004. (b) For the purposes of this chapter, the following definitions apply: (1) "Accommodations" means either of the following: (A) The residential rental units in any detached physical structure containing four or more residential rental units. (B) With respect to a detached physical structure containing three or fewer residential rental units, the residential rental units in that structure and in any other structure located on the same parcel of land, including any detached physical structure specified in subparagraph (A). (2) "Disabled" means a person with a disability, as defined in Section 12955.3 of the Government Code. SEC. 2. Section 7060.1 of the Government Code is amended to read: 7060.1. Notwithstanding Section 7060, nothing in this chapter does any of the following: (a) Prevents a public entity from enforcing any contract or agreement by which an owner of residential real property has agreed to offer the accommodations for rent or lease in consideration for a direct financial contribution or, with respect to written contracts or agreements entered into prior to July 1, 1986, for any consideration. Any contract or agreement specified in this subdivision is not enforceable against a person who acquires title to the accommodations as a bona fide purchaser for value (or successors in interest thereof), unless (1) the purchaser at the time of acquiring title to the accommodations has actual knowledge of the contract or agreement, or (2) a written memorandum of the contract or agreement which specifically describes the terms thereof and the affected real property, and which identifies the owner of the property, has been recorded with the county recorder prior to July 1, 1986, or not less than 30 days prior to transfer of title to the property to the purchaser. The county recorder shall index such a written memorandum in the grantor-grantee index. As used in this subdivision, "direct financial contribution" includes contributions specified in Section 65916 and any form of interest rate subsidy or tax abatement provided to facilitate the acquisition or development of real property. (b) Diminishes or enhances, except as specifically provided in Section 7060.2, any power which currently exists or which may hereafter exist in any public entity to grant or deny any entitlement to the use of real property, including, but not limited to, planning, zoning, and subdivision map approvals. (c) Diminishes or enhances any power in any public entity to mitigate any adverse impact on persons displaced by reason of the withdrawal from rent or lease of any accommodations. (d) Supersedes any provision of Chapter 16 (commencing with Section 7260) of this division, Part 2.8 (commencing with Section 12900) of Division 3 of Title 2 of this code, Chapter 5 (commencing with Section 17200) of Part 2 of Division 7 of the Business and Professions Code, Part 2 (commencing with Section 43) of Division 1 of the Civil Code, Title 5 (commencing with Section 1925) of Part 4 of Division 3 of the Civil Code, Chapter 4 (commencing with Section 1159) of Title 3 of Part 3 of the Code of Civil Procedure, or Division 24 (commencing with Section 33000) of the Health and Safety Code. (e) Relieves any party to a lease or rental agreement of the duty to perform any obligation under that lease or rental agreement.