Newsom signs wave of tenant protection bills into law

Newsom signs tenant bills to lower security deposits, prevent more evictions

A sign says "Stop evictions," written in English and Spanish.

By Hannah WileyStaff Writer

Oct. 11, 2023 6:58 PM PT

California Gov. Gavin Newsom signed several new laws to protect tenants against eviction and high rental costs, including a bill that caps how much people pay upfront in security deposits.

The bills strengthen California’s already robust tenant protection laws and aim to prevent vulnerable, low-income renters from falling into homelessness and worsening one of the state’s greatest crises.

Here are three bills Newsom signed in recent weeks and one he vetoed amid concerns over costs:

Limiting security deposits

One of the more significant measures Newsom signed this year is Assembly Bill 12, which will prohibit landlords from charging more than one month’s rent as a security deposit.

Assemblymember Matt Haney, a San Francisco Democrat who wrote AB 12, along with anti-poverty groups and labor unions, argued that high security deposit payments were often the barrier to people finding affordable housing, especially in wealthier cities along the coast with more exorbitant rent prices.

The opposition, including Republicans and moderate Democrats, claimed that landlords take on risk in renting out their homes, and that security deposits ensure they have enough money to cover any damage incurred. Reducing how much landlords can charge upfront, those opposed to the bill warned, could mean more rental housing being pulled from the market.

“Further limiting a property owner’s ability to financially cover property damage or unpaid rent is an unfair imposition for rental housing providers,” the California Apartment Assn. wrote in opposition to the bill.

The bill takes effect July 1.

Strengthening an anti-eviction law

California lawmakers in 2019 approved a bill that created new rules against eviction and capped yearly rent increases to 5% plus inflation.

This year, state Sen. María Elena Durazo (D-Los Angeles) introduced Senate Bill 567 to tighten those regulations and ensure that landlords weren’t using what proponents of the measure called loopholes in the law to illegally throw out tenants.

The new law signed by Newsom adds enforcement mechanisms to ensure that owners aren’t using allowable evictions to remove low-income residents, then turn around and put the unit back on the market with a higher rent price. It was similarly opposed by business groups, apartment and rental associations and moderate Democrats.

“Today is a victory for all Californians,” Michelle Pariset, director of legislative affairs at the nonprofit Public Advocates, said in statement when SB 567 was signed. “Through this law more of our neighbors will be able to stay in their homes!”

The law takes effect on April 1.

Lawmakers over the last several years have largely failed at passing bills to create more social housing, a type of publicly owned, mixed-income housing popular in Singapore and Austria that’s often more affordable than typical rental units.

This year, state Sen. Aisha Wahab (D-Hayward) introduced Senate Bill 555 to study how California can move forward in developing social housing, through some blend of acquisition of existing buildings or production of new homes. The bill dictates the California Department of Housing and Community Development to issue a robust study by Dec. 31, 2026, laying out funding options and public land available, along with challenges that the state could face in pursuing social housing.

Critics of the social housing bill Newsom signed pointed out that a study doesn’t construct new homes.

Instead, they supported Assembly Bill 309, a bill by Assemblymember Alex Lee (D-San Jose), which would have created a new program within the state Department of General Services to eventually develop up to three social housing projects on state-owned surplus land.

Newsom vetoed the bill on Oct. 7, arguing that the state was already developing affordable housing on surplus land, while claiming the bill “could potentially cost the state several hundred million dollars.”