Amended in Assembly June 16, 2016

Amended in Assembly July 8, 2015

Amended in Senate April 23, 2015

Senate Bill No. 775

Introduced by Senator Allen

February 27, 2015

An act to amend Section 1947.8 of the Civil Code, relating to tenancy.

LEGISLATIVE COUNSEL’S DIGEST

SB 775, as amended, Allen. Tenancy: rent control: certification.

(1) Existing law regulates the terms and conditions of residential tenancies. Existing law, the Costa-Hawkins Rental Housing Act, prescribes statewide limits on the application of local rent control with regard to certain properties, including those that have a certificate of occupancy issued after February 1, 1995. Existing law requires a local ordinance or charter controlling residential rent prices that requires registration of rents to provide for the certification of permissible rent levels and prescribes a process in this regard, including a requirement that, upon the request, a local agency provide a landlord and a tenant with a certificate reflecting the permissible rent levels of the rental unit. Existing law provides that the permissible rent levels reflected in the certificate are, in the absence of intentional misrepresentation or fraud, binding and conclusive upon the local agency unless the determination of the permissible rent levels is appealed.

This bill would specify that the certification provisions described above, on and after January 1, 2016, do not apply to tenancies for which the owner of residential property may establish the initial rent under the Costa-Hawkins Rental Housing Act, as specified. The bill would except from this exclusion a tenancy for which the property owner provides the local rent control agency with a writing, signed under penalty of perjury, of the tenancy’s initial rent that complies with the agency’s requirements, which would create a rebuttable presumption that the statement of the initial rent is correct. By expanding the crime of perjury, this bill would impose a state-mandated local program.

(2) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.

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

SECTION 1.  

Section 1947.8 of the Civil Code is amended to
read:

1947.8.  

(a) If an ordinance or charter controls or establishes
a system of controls on the price at which residential rental units
may be offered for rent or lease and requires the registration of
rents, the ordinance or charter, or any regulation adopted pursuant
thereto, shall provide for the establishment and certification of
permissible rent levels for the registered rental units, and any
changes thereafter to those rent levels, by the local agency as
provided in this section.

(b) If the ordinance, charter, or regulation is in effect on January
1, 1987, the ordinance, charter, or regulation shall provide for the
establishment and certification of permissible rent levels on or
before January 1, 1988, including completion of all appeals and
administrative proceedings connected therewith. After July 1,
1990, no local agency may maintain any action to recover excess
rent against any property owner who has registered the unit with
the local agency within the time limits set forth in this section if
the initial certification of permissible rent levels affecting that
particular property has not been completed, unless the delay is
willfully and intentionally caused by the property owner or is a
result of court proceedings or further administrative proceedings
ordered by a court. If the ordinance, charter, or regulation is
adopted on or after January 1, 1987, the ordinance, charter, or
regulation shall provide for the establishment and certification of
permissible rent levels within one year after it is adopted, including
completion of all appeals and administrative proceedings connected
therewith. Upon the request of the landlord or the tenant, the local
agency shall provide the landlord and the tenant with a certificate
or other documentation reflecting the permissible rent levels of
the rental unit. A landlord may request a certificate of permissible
rent levels for rental units which have a base rent established, but
which are vacant and not exempt from registration under this
section. The landlord or the tenant may appeal the determination
of the permissible rent levels reflected in the certificate. The
permissible rent levels reflected in the certificate or other
documentation shall, in the absence of intentional misrepresentation
or fraud, be binding and conclusive upon the local agency unless
the determination of the permissible rent levels is being appealed.

(c) After the establishment and certification of permissible rent
levels under subdivision (b), the local agency shall, upon the
request of the landlord or the tenant, provide the landlord and the
tenant with a certificate of the permissible rent levels of the rental
unit. The certificate shall be issued within five business days from
the date of request by the landlord or the tenant. The permissible
rent levels reflected in the certificate shall, in the absence of
intentional misrepresentation or fraud, be binding and conclusive
upon the local agency unless the determination of the permissible
rent levels is being appealed. The landlord or the tenant may appeal
the determination of the permissible rent levels reflected in the
certificate. Any appeal of a determination of permissible rent levels
as reflected in the certificate, other than an appeal made pursuant
to subdivision (b), shall be filed with the local agency within 15
days from issuance of the certificate. The local agency shall notify,
in writing, the landlord and the tenant of its decision within 60
days following the filing of the appeal.

(d) The local agency may charge the person to whom a
certificate is issued a fee in the amount necessary to cover the
reasonable costs incurred by the local agency in issuing the
certificate.

(e) The absence of a certification of permissible rent levels shall
not impair, restrict, abridge, or otherwise interfere with either of
the following:

(1) A judicial or administrative hearing.

(2) Any matter in connection with a conveyance of an interest
in property.

(f) The record of permissible rent levels is a public record for
purposes of the California Public Records Act (Chapter 3.5
(commencing with Section 6250) of Division 7 of Title 1 of the
Government Code).

(g) Any notice specifying the rents applicable to residential
rental units which is given by an owner to a public entity or tenant
in order to comply with Chapter 12.75 (commencing with Section
7060) of Division 7 of Title 1 of the Government Code shall not
be considered a registration of rents for purposes of this section.

(h) “Local agency,” as used in this section, means the public
entity responsible for the implementation of the ordinance, charter,
or regulation.

(i) Nothing in this section shall be construed:

(1) To grant to any public entity any power which it does not
possess independent of this section to control or establish a system
of control on the price at which accommodations may be offered
for rent or lease, or to diminish any such power which that public
entity may possess, except as specifically provided in this section.

(2) On and after January 1, 2016, to apply to tenancies
commencing on or after January 1, 1999, for which the owner of
residential property may establish the initial rent under Chapter
2.7 (commencing with Section begin delete 1954.50), except that, end delete begin insert 1954.50).
However, end insert for a tenancy that commenced on or after January 1,
1999, if begin delete the end delete begin insert a end insert property owner begin delete provides end delete begin insert has provided end insert the local
agency with the tenancy’s initial rent in compliance with that
agency’s registration begin delete requirements, end delete begin insert requirements end insert in begin insert a end insert writing
signed under penalty of perjury, there shall be a rebuttable
presumption that the statement of the initial rent is correct.

SEC. 2.  

No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of
the Government Code, or changes the definition of a crime within
the meaning of Section 6 of Article XIII B of the California
Constitution.