BILL ANALYSIS                                                                                                                                                                                                    Ó


          |SENATE RULES COMMITTEE            |                  AB 1679|
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                                 THIRD READING

          Bill No:  AB 1679
          Author:   Bonilla (D)
          Amended:  8/9/12 in Senate
          Vote:     21

           SENATE JUDICIARY COMMITTEE  :  4-0, 6/12/12
          AYES:  Evans, Harman, Corbett, Leno
          NO VOTE RECORDED:  Blakeslee
          ASSEMBLY FLOOR  :  78-0, 3/26/12 (Consent) - See last page 
            for vote

           SUBJECT  :    Landlord-tenant relations:  security deposits

           SOURCE  :     California Apartment Association

           DIGEST  :    This bill, after either a residential landlord 
          or tenant provides notice to terminate the tenancy, allows 
          the landlord and tenant to agree to 
          (1) have the landlord deposit the remaining portion of a 
          tenant's security deposit electronically to a bank account, 
          and (2) have the landlord provide a copy of specified 
          documents to an e-mail account provided by the tenant.

           Senate Floor Amendments  of 8/9/12 address chaptering-out 
          issues with AB 2521 (Blumenfield).

           NOTE:  This bill passed the Senate (38-0) on 6/18/12 but 
                 was returned for these amendments.



                                                               AB 1679

           ANALYSIS  :    Existing law generally regulates the 
          landlord-tenant relationship, including the return of any 
          security deposit provided by the tenant.  (Civil Code (CIV) 
          Section 1940 et seq.)

          Existing law limits the amount of security deposit that may 
          be required by a landlord and permits the landlord to only 
          claim amounts from that deposit which are reasonably 
          necessary for specified purposes.  Those purposes include 
          compensating for a tenant's default in payment of rent, 
          repair of damages to the premises (exclusive of ordinary 
          wear and tear), and cleaning the premises, as specified.  
          (CIV Section 1950.5)

          Existing law provides that no later than 21 calendar days 
          after the tenant has vacated the premises, as specified, 
          the landlord shall furnish the tenant with a copy of an 
          itemized statement indicating the basis for, and the amount 
          of, any security received and the disposition of the 
          security and shall return any remaining portion of the 
          security to the tenant.  (CIV Section 1950.5)

          This bill, after either the landlord or tenant provides 
          notice to terminate the tenancy, permits the landlord and 
          tenant to agree to:

          1. Have the landlord deposit any remaining portion of the 
             security deposit electronically to a bank account or 
             other financial institution designated by the tenant; 

          2. Have the landlord provide a copy of the itemized 
             statement along with the required copies of documents, 
             as specified, to an e-mail account provided by the 

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  No   
          Local:  No

           SUPPORT  :   (Verified  8/9/12)

          California Apartment Association (source)

           ARGUMENTS IN SUPPORT  :    According to the author, "Under 



                                                               AB 1679

          current law, rental property owners are required to return 
          tenant security deposits within 21 days only through a 
          physical check delivered personally or by first-class mail. 
           This requirement to return a security deposit by a 
          physical check was first placed in statute decades ago, 
          long before the advent of modern technology, electronic 
          fund transfer options, and email.  Today, more tenants are 
          asking that rental property owners return any remaining 
          security deposit directly into their bank account.  This 
          request is consistent with the way in which many tenants 
          already chose to pay their rent - through an electronic 
          fund transfer (EFT)?"

          The author further notes that by allowing security deposits 
          to be deposited electronically into a bank account, "AB 
          1679 will benefit both property owners and tenantsÝand 
          o]wners will be able to provide a service for those tenants 
          who seek it, while speeding up the process for returning 
          the tenant's deposit."

           ASSEMBLY FLOOR  :  78-0, 3/26/12
          AYES:  Achadjian, Alejo, Allen, Ammiano, Atkins, Beall, 
            Bill Berryhill, Block, Blumenfield, Bonilla, Bradford, 
            Brownley, Buchanan, Butler, Charles Calderon, Campos, 
            Carter, Cedillo, Chesbro, Conway, Cook, Davis, Dickinson, 
            Donnelly, Eng, Feuer, Fletcher, Fong, Fuentes, Furutani, 
            Beth Gaines, Galgiani, Garrick, Gatto, Gordon, Grove, 
            Hagman, Halderman, Hall, Harkey, Hayashi, Roger 
            Hernández, Hill, Huber, Hueso, Huffman, Jeffries, Jones, 
            Knight, Lara, Logue, Ma, Mansoor, Mendoza, Miller, 
            Mitchell, Monning, Morrell, Nestande, Nielsen, Norby, 
            Olsen, Pan, Perea, V. Manuel Pérez, Portantino, Silva, 
            Skinner, Smyth, Solorio, Swanson, Torres, Valadao, 
            Wagner, Wieckowski, Williams, Yamada, John A. Pérez
          NO VOTE RECORDED:  Gorell, Bonnie Lowenthal

          RJG:m  8/14/12   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  SEE ABOVE

                                ****  END  ****



                                                               AB 1679