California Assembly Bill AB2282 Amended / Bill

 BILL NUMBER: AB 2282AMENDED BILL TEXT AMENDED IN SENATE AUGUST 8, 2016 AMENDED IN SENATE JUNE 20, 2016 AMENDED IN ASSEMBLY MAY 31, 2016 AMENDED IN ASSEMBLY APRIL 25, 2016 AMENDED IN ASSEMBLY APRIL 12, 2016 AMENDED IN ASSEMBLY APRIL 4, 2016 INTRODUCED BY Assembly Member Calderon FEBRUARY 18, 2016 An act to add Section 65009.5 to the Government Code, relating to  housing.   housing, declaring the urgency thereof, to take effect immediately. LEGISLATIVE COUNSEL'S DIGEST AB 2282, as amended, Calderon. Rental housing: large-scale buy-to-rent investors: data collection. Existing law, the Planning and Zoning Law requires cities and counties to prepare and adopt a general plan for their jurisdictions that contains certain mandatory elements, including a housing element. Existing law requires the housing element to include, among other things, an inventory of land suitable for residential development and to make adequate provision for the existing and projected needs of all economic segments of the community. Existing law states legislative findings declaring that the preservation and enhancement of opportunities for homeownership are beneficial to the well-being and prosperity of the people of the state. This bill would establish the Task Force on Institutional Investors within the Bureau of Real Estate, under the leadership of the Real Estate Commissioner. The bill would require the task force, on or before July 1, 2018, to submit to the Governor and the Legislature a report that includes information regarding how many large-scale buy-to-rent investors own property in the state for the purpose of renting the property, which regions of the state their investment activity is occurring, the number, density, and percentage of single-family homes each large-scale buy-to-rent investor owns, an analysis of the potential impacts of their investments, as specified,  data on how the structure of the investment instruments in which properties in California are held,  and recommendations on how to increase homeownership among the residents of  California.   California and the tracking and monitoring of large-scale buy-to-rent investor holdings.  The bill would make various findings and declarations in this regard.  This bill would declare that it is to take effect immediately as an urgency statute.  Vote:  majority   2/3  . Appropriation: no. Fiscal committee: yes. State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 65009.5 is added to the Government Code, to read: 65009.5. (a) (1) It is the intent of the Legislature in enacting this provision to analyze the impacts on the real estate market in California of the investment activities of large-scale buy-to-rent investors that, since October 2013, have involved a mortgage-based security supported by the revenue from single-family rental properties. (2) The emergence of this type of security is likely to grow and scale institutionally owned single-family rental homes to a level that is, at this time, unknown. However, with home prices currently approaching record highs, yet with homeownership at historic lows, it is important to understand the size and scope of investor activity of single-family homes and the impacts it has on the real estate market in California. (3) It is in the best interest of the State of California to help ensure, to the extent feasible, that families and individuals are able to become homeowners. (4) Large-scale buy-to-rent investors own more single-family homes than any other population in the United States, a market once dominated by local, private owners.  (5) It is critical to know to what extent these new investors are crowding out potential owner-occupants or artificially inflating home prices.   (6) Before any meaningful legislative action takes place, more data needs to be collected and analyzed to ensure the proper oversight over this new investment activity. There is currently insufficient data to properly categorize the problem, and while the impacts are currently unknown, families and other first-time homebuyers are certainly put at a disadvantage when having to compete against a large investment firm. This can exacerbate income inequality issues in the state and must be addressed sooner rather than later to protect the American Dream of buying and owning a home.   (7) To the extent these investments are geographically clustered, they could have unintended ripple effects across regions throughout California and should be examined more closely. Should the Legislature wait longer to gather and analyze the appropriate data, thousands more homes could be off the market for purchase by families and other first-time homebuyers.  (b) (1) To ensure that the citizens of California preserve the ability to become homeowners and are not overtly challenged by institutional investors in the real estate market, the Task Force on Institutional Investors, hereafter referred to in this section as "the task force," is hereby created in the Bureau of Real Estate. Under the leadership of the Real Estate Commissioner, the task force shall examine the impacts that large-scale buy-to-rent investors are having on the real estate market in California. (2) The membership of the task force shall be as follows: (A) The Real Estate Commissioner, or his or her designee, who shall serve as the chair of the task force. (B) A professor from either the University of California or the California State University with an extensive background and knowledge of the real estate market, to be appointed by the Governor. (C) A local government official with an extensive background and knowledge of the real estate market, to be appointed by the Governor. (D) A real estate expert, to be appointed by the  President pro Tempore of the Senate.   Senate Committee on Rules.  (E) A real estate finance expert, to be appointed by the Speaker of the Assembly.  (F) A legal services expert with expertise on homeownership from northern California, to be appointed by the Speaker of the Assembly.   (G) A legal services expert with expertise on homeownership from central California, to be appointed by the Governor.   (H) A housing counselor certified by the United States Department of Housing and Urban Development from southern California, to be appointed by the Senate Committee on Rules.   (I) An expert from a county assessor's office, to be appointed by the Governor.  (3) The Bagley-Keene Open Meeting Act (Article 9 (commencing with Section 11120) of Chapter 1 of Part 1 of Division 3 of Title 2 of the Government Code) shall apply to meetings of the task force. (c) On or before July 1, 2018, the task force shall submit to the Governor and the Legislature a report that includes, but is not limited to, all of the following: (1) Information regarding how many large-scale buy-to-rent investors own property in the state for the purpose of renting the property, and which regions of the state their investment activity is occurring. (2) The number, density, and percentage of single-family homes each large-scale buy-to-rent investor owns, and an analysis of the potential impacts their investments are having on the local real estate market, including the price of homes, the ability of individual home buyers, specifically those who need financing, to compete against the large-scale buy-to-rent investors, the length of time large-scale buy-to-rent investors are holding their property as a rental, and how many homes they are selling each year.  (3) Data on the structure of the investment instruments in which properties in California are held, including, but not limited to, factors that could affect the timing and quantity of property turnover in California by investors and the potential effects of the investment structure on California's rental and homeownership markets.   (3)   (4)  Recommendations to the Governor and the Legislature on how to increase homeownership among the residents of California,  and the tracking and monitoring of large-scale buy-to-rent investor holdings,  including proposed legislative or regulatory actions, homebuyer assistance programs, and any other recommendations the task force deems appropriate. (d) As used in this section, "large-scale buy-to-rent investor" means a publicly traded company devoted to holding and managing single-family home rental properties, either on behalf of clients or for itself, and which owns more than 100 single-family homes during a calendar year. (e) (1) The requirement to submit a report imposed under subdivision (c) is inoperative on January 1, 2022, pursuant to Section 10231.5 of the Government Code. (2) A report submitted pursuant to subdivision (c) shall be submitted in compliance with Section 9795 of the Government Code.  SEC. 2.   This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are:   In order to provide for the expedient collection of data on large-scale buy-to-rent investors to allow for meaningful legislative action that will help alleviate the pressing concern of rising home prices, it is necessary that this act take effect immediately.