Prop. 33 Threatens to Repeal Costa-Hawkins
This is the third attempt to repeal Costa-Hawkins. Such measures failed in 2018 and 2020.
Proposition 33 asks California voters to make it easier for cities and counties to limit how much a landlord can charge a tenant for rent. The ballot measure would specifically repeal a state law that restricts the ability of cities and counties to impose rent control.
Under that law, known as the Costa-Hawkins Rental Housing Act, cities cannot set rent control on single-family homes or apartments built after 1995. Landlords are also able to charge however much they want when a new tenant moves into their property under current law. Passage of Prop 33 would end these protections.
Passage of Prop 33 will reduce property tax revenues of at least tens of millions of dollars annually due to likely expansion of rent control in some communities. Rent control decreases property values, and consequently, property tax revenue.
San Francisco Supervisor Aaron Peskin has already introduced legislation to greatly expand San Francisco’s rent control ordinance immediately if Prop 33 passes in November.
Prop 34 Explained
If passed, Prop. 34 would require certain health care providers to use prescription drug revenue for patients.
Since 1992, federal law has given health care providers a deal: Serve low-income and at-risk patients and get a discount on pharmaceuticals. Providers that make use of this program can turn around and sell those drugs at retail rates. Their profits can then be used to expand their healthcare services to disadvantaged groups.
Proposition 34 would require some California providers to spend at least 98% of that net drug sale revenue on “direct patient care.” Providers that don’t risk having their state license and tax-exempt status revoked and losing out on government contracts.
But the proposition doesn’t apply to all providers — only those that spend at least $100 million on expenses other than direct care, that also own and operate apartment buildings and that have racked up at least 500 severe health and safety violations in the last decade.
As far as anyone can tell, that only applies to one organization: The AIDS Healthcare Foundation.
Why target this one organization? The AIDS Healthcare Foundation is run by long-time President Michael Weinstein. Under his leadership, the foundation has also become a major player in state and local housing politics. It has poured tens of millions of dollars into two unsuccessful statewide rent control measures (Prop. 33 on this year’s ballot is round three). It has aggressively lobbied and campaigned against legislation requiring local governments to permit denser housing. By restricting how the AHF spends their funds, Prop 34 essentially limits Weinstein’s ability to continue to fight to repeal Costa-Hawkins.