BILL ANALYSIS Ó
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
SB 1053 (Leno) - Housing discrimination: applications
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|Version: April 4, 2016 |Policy Vote: JUD. 4 - 2 |
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|Urgency: No |Mandate: Yes |
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|Hearing Date: April 18, 2016 |Consultant: Jolie Onodera |
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This bill meets the criteria for the referral to the Suspense
File.
Bill
Summary: SB 1053 would increase the protections against housing
discrimination on the basis of one's source of income under the
Fair Employment and Housing Act (FEHA) by revising the
definition of "source of income" to include lawful, verifiable
income paid to a housing owner or landlord on behalf of a
tenant, including federal, state, or local public assistance or
housing subsidies, including, but not limited to, federal
housing assistance vouchers under Section 8 of the United States
Housing Act of 1937, as specified.
Fiscal
Impact:
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DFEH workload : Potentially significant increase in housing
discrimination complaints received under the revised
definition of "source of income" required to be reviewed and
investigated. The Department of Fair Employment and Housing
(DFEH) estimates additional staffing could potentially be
required at a cost in excess of $350,000 (General Fund)
annually to address the additional workload.
Local Public Housing Agencies (PHAs) : To the extent higher
utilization rates of housing assistance programs result from
this measure, local PHA administrative costs could increase
significantly. Administrative services provided by PHAs
include outreach to tenants and owners, waiting list
management, determination of client eligibility, issuance of
vouchers, tenant and owner briefings, housing quality
standards inspections, annual re-certifications, interim
adjustments, and records maintenance.
HCD/CalHFA : No fiscal information was available from
HCD/CalHFA at the time of this analysis. Staff notes the
responsibility for acting as the PHA under the Section 8
voucher program for 12 rural counties was transferred from the
Department of Housing and Community Development (HCD) to local
and regional housing authorities in 2012.
County counsel : Potential minor increase in time required to
review and approve Restrictive Covenant Modification
documents. These costs are potentially state-reimbursable
(General Fund) to the extent the Commission on State Mandates
determines the revised definition of "source of income"
expands upon a formerly mandated higher level of service on
county counsel to determine whether there exists an unlawfully
restrictive covenant based on source of income, as redefined
under the provisions of this bill.
County recorders : Non-reimbursable local costs to county
recorders to accept and record additional Restrictive Covenant
Modification documents, as county recorders are authorized to
charge or waive fees for this service.
Impact on public social services : To the extent the
provisions of this bill provide greater opportunities for
persons to secure housing, greater utilization of federal
vouchers could be realized, as well as potential future cost
savings in reduced reliance on other federal, state, and local
public social services.
Background: The California Fair Employment and Housing Act (FEHA)
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prohibits employment and housing discrimination against any
person on the basis of race, color, religion, sex, gender,
gender identity, gender expression, sexual orientation, marital
status, national origin, ancestry, familial status, source of
income, disability, or genetic information of that person.
(Government Code (GC) § 12920.) The FEHA additionally provides
that the opportunities to seek, obtain, and hold employment and
housing without facing discrimination is a civil right. (GC §
12921.)
The FEHA protects against housing discrimination on the basis of
one's "source of income," which is defined as the "lawful,
verifiable income paid directly to a tenant or paid to a
representative of a tenant," and states that "a landlord is not
considered a representative of a tenant" for purposes of this
definition. (GC §§ 12927(i), 12955(p).)
Federal housing assistance programs such as the Housing Choice
Voucher (HCV) program, more commonly referred to as "Section 8
vouchers," provide assistance in the form of vouchers that can
be used to acquire housing on the private market to provide
decent, safe, and sanitary housing to low-income families, the
elderly, and the disabled. At the state level, public assistance
programs such as the Housing Opportunity for People with AIDS
(HOPWA) and HOME provide tenant-based rental assistance to
eligible persons. Additionally, California recently established
the Housing Support Program (HSP) pursuant to SB 855 (Chapter
29/2014) for eligible CalWORKs families. However, despite the
availability of such housing assistance programs, some program
participants may face challenges finding landlords willing to
accept housing assistance payments in their communities.
This bill seeks to ensure that landlords do not deny low-income
families and other vulnerable populations the opportunity to
apply for available housing by expanding protections against
housing discrimination under the FEHA by revising the definition
of "source of income" to include income paid to a housing owner
or landlord on behalf of a tenant, including federal, state, or
local public assistance or subsidies.
SB 1053 (Leno) Page 3 of
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Proposed
Law: This bill would expand the definition of "source of
income" under the FEHA to include lawful, verifiable income paid
to a housing owner or landlord on behalf of a tenant, including
federal, state, or local public assistance and federal, state,
or local housing subsidies, including, but not limited to,
federal housing assistance vouchers under Section 8 of the
United States Housing Act of 1937, as specified.
Prior
Legislation: AB 447 (Maienschein) Chapter 432/2015 prohibited
real property insurers from, among other things, failing or
refusing to accept an application, issue, or cancel a policy
based on the level or source of income of individuals residing
or intending to reside on the real property, or based on the
receipt of assistance intended for housing from government
agencies or other specified persons.
SB 1252 (Corbett) Chapter 524/2010 made technical revisions to
several provisions of the FEHA, including consistently listing
"source of income" as a characteristic that is protected from
housing discrimination in various sections of the FEHA.
SB 1145 (Burton) Chapter 568/2004, among its provisions, removed
the sunset date and thereby extended indefinitely the provision
adopted in SB 1098 which prohibited discrimination under the
FEHA on the basis of a person's source of income, as specified.
SB 1098 (Burton) Chapter 590/1999 prohibited, until January 1,
2005, discrimination under the FEHA on the basis of a person's
source of income, the failure to account for the aggregate
income of co-residents, or the failure to exclude a government
rent subsidy from that portion of the rent to be paid by the
tenant in assessing his or her eligibility for rental housing.
SB 1148 (Burton) Chapter 589/1999 required title insurance
companies, real estate brokers, county recorders and others to
include in a copy of a declaration, governing document, or deed
a cover page (or to stamp the first page of the document) that
states that any discriminatory restriction contained in the
document is a violation of state and federal fair housing laws
and is void. SB 1148 also required county recorders to remove
"blatant racial restrictions" when requested to do so by anyone
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having an interest in the property.
Staff
Comments: By expanding the definition of "source of income"
under the FEHA, the DFEH has indicated the potential for
additional housing discrimination complaints to be filed. Based
on data from 10 other jurisdictions (including 8 other states
and the District of Columbia) that prohibit housing
discrimination based on source of income and include
tenant-based rental assistance in that definition, the DFEH has
estimated the number of complaints could increase by 175
complaints per year (which would result in a 120 percent
increase over the number of complaints received based on source
of income in 2014), resulting in a potential need for additional
staffing in excess of $350,000 annually to review and
investigate the additional complaints.
Staff notes there are timeframes within which specified housing
complaints must be reviewed and investigated. As indicated in
its March 2015, "Report to the Joint Legislative Budget
Committee," the DFEH states that the federal Department of
Housing and Urban Development (HUD) requires DFEH to complete 50
percent of its investigations of housing complaints within 100
days of the filing of the complaints which are "dual-filed,"
which are complaints over which both the DFEH and HUD have
jurisdiction and are filed with both entities.
Local public housing agencies (PHAs) are the primary
administrators of the federal Section 8 voucher program. In
California, over 100 PHAs administer housing assistance programs
and receive federal funds from HUD to administer the voucher
program. Prior to 2012, the Department of Housing and Community
Development (HCD) acted as the PHA in the administration of the
Section 8 voucher program in 12 rural counties, however, this
responsibility was transferred from HCD to local and regional
housing authorities effective January 1, 2012. To the extent the
provisions of this bill result in a significant increase in
utilization rates of housing assistance programs such as the
federal Section 8 voucher program, administrative costs to local
PHAs could increase significantly. Administrative services
provided by PHAs include outreach to tenants and owners, waiting
list management, determination of client eligibility, issuance
of vouchers, tenant and owner briefings, housing quality
standards inspections, annual re-certifications, interim
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adjustments, and records maintenance.
Under the FEHA, responsibility for the procedure by which
unlawful restrictive covenants may be removed was transferred
from the DFEH to local county recorders in 2006. By expanding
the definition of "source of income" under the FEHA, this bill
could result in additional restrictive covenant modification
forms being submitted to county recorders which would require
review and approval by the county counsel prior to recordation
by the county recorder. To the extent the time required to
review and approve of Restrictive Covenant Modification
documents increases due to the provisions of this bill, these
costs are potentially state-reimbursable (General Fund) to the
extent the Commission on State Mandates determines the revised
definition of "source of income" expands upon a formerly
mandated higher level of service on county counsel to determine
whether there exists an unlawfully restrictive covenant based on
source of income.
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