Here is a summary of some new laws passed by the California Legislature that may affect REALTORS® in 2019. You can view an even larger list on C.A.R.’s website and you can read the full text of each law here.

 


Civil Liability: Liability of real estate agents for sexual harassment expanded

Even if a business, service, or professional “relationship” does not presently exist, a real estate agent (and “investor” among other persons) may be liable for sexual harassment when he or she holds himself or herself out as being able to help the plaintiff establish a business, service, or professional relationship with the defendant or a third party. This law eliminates the element that the plaintiff prove there is an inability by the plaintiff to easily terminate the relationship. (Senate Bill 224)


Common Interest Developments: Financial review on a monthly basis and other anti-fraud precautions 

This law requires HOA boards to review on a monthly basis the association’s accounts and reserves; requires fidelity bond coverage for directors, officers, and employees to be maintained equal to three months’ reserves; and requires a manager to obtain written board approval before they may transfer association funds of $10,000 or more. (Assembly Bill 2912)


Employment: Discrimination and harassment

Prohibits an employer from requiring the execution of a release or non-disparagement agreement in exchange for any condition of employment. Broadens the definition of harassment to include any type of harassment, not merely sexual, for which an employer may be responsible when committed by a nonemployee. Explains in detail the legal standards constituting sexual harassment by citing and affirming various court cases. (Senate Bill 1300)


Employment: Sexual harassment training requirements Expanded By January 1, 2020.

Employers who employ 5 or more employees, including temporary or seasonal employees, must provide at least 2 hours of sexual harassment training to all supervisory employees and at least one hour of sexual harassment training to all nonsupervisory employees by January 1, 2020, and once every 2 years thereafter. (Senate Bill 1343)


Financial Disclosures: Foreign language translations for loan modifications

This law requires financial institutions to provide specified mortgage loan modification documents in the same language as the negotiation if the terms of negotiation are conducted in Spanish, Chinese, Tagalog, Vietnamese, or Korean. Currently, these disclosures are required only when a loan is originated. The law is also updated to include the Loan Estimate and Closing Disclosure forms in addition to the Good Faith Estimate. (Senate Bill 1201)


Insurance: Fires and other natural disasters: Eight new laws to strengthen the rights of homeowners

With wildfires and other disasters devastating areas across the state, insurers have employed various tactics to avoid paying out on claims and to minimize their losses in the future. This set of eight new laws attempts to ensure that a homeowner who has purchased insurance will realize the benefits of their policy and will not be improperly or unfairly denied coverage presently or in the future.

(View links to all 8 laws on C.A.R.’s website)


Real Estate Law Clean-up: Updates the real estate law to make it clearer and conform it to existing practice.

This C.A.R. sponsored “clean-up” legislation updates the real estate law to conform it to existing practice, eliminates antiquated or confusing laws, clarifies existing law, and introduces plain language where appropriate.

Among the more important changes: This law reiterates that existing law permits agents and brokers to establish their working relationship as one of either independent contractor or employment: it consolidates real estate definitions across a range of laws; and it resolves a variety of specific issues caused by confusing and antiquated laws. (Assembly Bill 1289)


Real Estate Law Clean-up: Independent Contractor Relationship Reaffirmed: New Private Transfer Fees Outlawed

This C.A.R. sponsored law prohibits developers from creating new property covenants, conditions, or restrictions that force subsequent owners to pay specially designated fees every time the property is transferred, unless the fee provides a “direct benefit” to the property, as defined in federal law. (Assembly Bill 2884)


Sexual Harassment: Liability for real estate agents expanded

Even if a business, service, or professional “relationship” does not presently exist, a real estate agent (and “investor” among other persons) may be liable for sexual harassment when he or she holds himself or herself out as being able to help the plaintiff establish a business, service, or professional relationship with the defendant or a third party. This law eliminates the element that the plaintiff must prove there is an inability by the plaintiff to easily terminate the relationship. (Senate Bill 224)

The Santa Clara County Association of REALTORS® supports the proposed Memorandum of Understanding with Google, Inc. SCCAOR’s support for the MOU extends to support for the long-term vision laid out in the Diridon Station Area Plan originally adopted by Council in 2014. The plan, which includes a vision and strategy for a housing element in the Diridon area, articulates the importance and necessity of Google’s presence and the ability to move forward in approval of the proposed MOU. As a result of this articulated vision for the Diridon Station Area, and Google’s willingness to create a shared vision of benefit to the community and the City of San Jose it is critical to push this project forward into the next phase.

As a member-supported non-profit organization committed to the principles of equal-opportunities in housing, economic development, private property rights, and community building since 1896, SCCAOR identifies the following, specifically, as reasons to support approval of the MOU:

  1. Capitalize on Transit Synergy. Create a “whole greater than the sum of the parts” in the Diridon Station Area with new urban development, expanded transit service, and a new intermodal station in conjunction with transit partners Valley Transportation Authority, Caltrain, and the California High Speed Rail Authority.

  2. Optimize Density and Mix of Uses. Optimize development density and create a complementary mix of uses in order to create a vibrant, transit-oriented urban neighborhood and destination.

  3. Grow and Preserve Housing. Grow and preserve housing in the City to help address rising housing costs and displacement. Housing in the Diridon Station Area should include on-site units affordable to low-income households and “missing middle” households, and market rate homes in a combination that is financially viable for residential developers to ensure that planned housing is built. Affordable units can be built both integrated into market-rate developments and as stand-alone affordable housing projects.

  4. Create Broad Job Opportunities. Promote opportunities for San José residents of all skill and educational levels and diverse backgrounds to prepare for and secure jobs in the Diridon Station Area. Provide opportunities for existing and new small, local businesses to benefit from and/or integrate into the new development.

  5. Pursue Equitable Development. Develop the Diridon Station Area with intent to minimize potential negative impacts on people and place, and to maximize opportunity for local youth and adults to participate and benefit from job opportunities in the Diridon Station Area, through partnerships among the City, Google, and others.

We thank the Mayor and Councilmembers for their continued effort to bring the Diridon Station Area Plan into fruition and to staff for their dedication to making the Google, Inc. project process as inclusive as possible. SCCAOR feels that in the same spirit of collaboration and information gathering that the Station Area Advisory Group was created with, has been captured in the subsequent dialogue and interactions between Google and the community, and between Google and the City of San Jose.

Housing. Housing. Housing. Whether it was “we need more” or “we need less”, housing dominated the narrative of the November 6, 2018 election in Santa Clara County. From local Measure V in San Jose to statewide-ballot propositions 1, 2, 5 and 10, housing, specifically affordable housing, was front and center.

The defeat of Proposition 10 (the repeal of Costa Hawkins – a law that currently protects new, multi-family construction post 1995 and duplexes/single family homes from being subject to rent control ordinances) was a sound lashing by voters for trying to place the burden of more affordable housing on the backs of those already providing it. However, the rent control battle is going to be raging on in many local jurisdictions for years to come.

Proposition 5 (the C.A.R. sponsored Tax Fairness Initiative designed to allow those aged 55 or older, victims of disasters – such as the Camp Fire – and veterans the ability to move their prop 13 tax basis to a new property in any county in California) failed to gather the required simple majority of votes.  However, prop. 5 did manage to secure a victory in Orange County and garnered 40.3% of the affirmative vote in Santa Clara County.

A major victory for smart-housing solutions in Santa Clara County was the success of Supervisor-Elect Susan Ellenberg in District 4. The defeat of her opponent, Don Rocha, was of paramount concern as Rocha has often been the catalyst seeking expansion of the rent stabilization program in San Jose.

In the local candidate races, housing was still front and center in the conversation, the results however, varied widely. In Milpitas for example, incumbents were entirely ousted for a council that is now going to be extremely progressive – and friendly toward rent control (stabilization). In South County, the cities of Morgan Hill and Gilroy both had SCCAOR supportive and SCCAOR endorsed candidate victories, including Marie Blankley and Peter Leroe-Munoz in Gilroy.

In San Jose District 9 Councilmember-Elect, Pam Foley, is holding on to her lead against her opponent with 98% of the vote counted. As a past president of our association and REALTOR® Champion, Pam will be another strong voice for REALTOR® Party issues that come before that council. However, in District 7, Councilmember-Elect, Maya Esparza, ousted incumbent-councilmember, Tam Nguyen, making for a surprise outcome that could possibly keep San Jose City Council friendly toward further expansion of their rent stabilization program.

All in all, while housing was the main topic of conversation, solutions were in short supply. It will be up to the many excellent candidates who were elected to continue the work developing solutions to our region’s housing issues – and up to our REALTOR® family to continue advocating for the rights of homeowners and homeownership.

Thank you to all our members who voted on November 6th, your vote mattered and it made a difference for the REALTOR® Party.

***PLEASE CONSIDER CONTRIBUTING to the REALTOR® Action Fund (RAF) as part of your SCCAOR membership renewal. RAF enables our advocacy team to assist candidates like Pam Foley, Marie Blankley, and Susan Ellenberg. Click here make a contribution to RAF today!***

The Santa Clara County Association of REALTORS® (SCCAOR) voted unanimously to endorse the following candidates running for office on the November 6, 2018 ballot:

  • Pam Foley – Candidate for San Jose City Council District 9
  • Susan Ellenberg – Candidate for Santa Clara County Supervisor in District 4
  • Paul Resnikoff – Incumbent Candidate for Campbell City Council
  • Bob Nunez – Candidate for Milpitas City Mayor
  • Marsha Grilli – Candidate for Milpitas City Council
  • Peter Leroe Munoz – Incumbent Candidate for Gilroy City Council
  • Marie Blankley – Incumbent Candidate for Gilroy City Council
  • James Dill – Morgan Hill School Board
  • Kelly Yip-Chuan – Milpitas School Board

The SCCAOR Board of Directors recognizes each of these candidates as aligning with our mission as a pro-housing and property rights association and are proud to offer them this endorsement.


Pam Foley

Pam Foley is a former President of the Santa Clara County Association of REALTORS® and would be a strong supporter of increased housing and economic development in the City of San Jose.  She currently serves on the San Jose Unified School Board.


Susan Ellenberg

Susan Ellenberg is a highly competent and qualified former real estate attorney who truly seeks to understand the issues before taking a position. Susan came to our association seeking information and to understand our position on housing and private property issues. We are proud to endorse her for Santa Clara County Supervisor District 4 as we believe that she will fairly represent District 4 on the Board of Supervisors and welcome all stakeholders to the table.


Paul Resnikoff

Paul Resnikoff has championed housing and economic development in the city of Campbell since he was first elected in 2014. He has proven to be a strong ally to REALTORS® and the REALTOR® Party issues in the city of Campbell. We are honored to offer him our unanimous endorsement for his re-election campaign to Campbell City Council.


Bob Nunez

A true collaborator, Bob Nunez, candidate for Mayor in the City of Milpitas, is a rare unifier in a very divided political climate. Bob will be a strong and thoughtful leader if elected. We are proud to offer Bob the sole and unanimous endorsement for his campaign for Milpitas City Mayor.


Marsha Grilli

Experienced and thoughtful, incumbent candidate for Milpitas City Council, Marsha Grilli, will continue to be a sound voice on the side of REALTORS® if re-elected. The Santa Clara County Association of REALTORS® is pleased to offer Marsha our unanimous endorsement for her re-election campaign to Milpitas City Council.


Marie Blankley

Rooted in her community, Gilroy City Council candidate Marie Blankley has the enthusiasm and vision to continue offering great contributions on the Gilroy City Council. A strong proponent for private property rights, we are honored to endorse Marie Blankley for her campaign for Gilroy City Council.


Peter Leroe Munoz

Knowledgeable and articulate in his vision and goals for the City of Gilroy, incumbent city council candidate Peter Leroe Munoz will continue to serve Gilroy well if re-elected. Peter is an outstanding advocate for public safety and better roads and infrastructure. He believes in the protection of private property rights and as such we are proud to endorse Peter Leroe Munoz for his re-election campaign to Gilroy City Council.


James Dill

James Dill is a current member of SCCAOR and a passionate candidate for the school board.  With a focus on school security and bullying he looks to better the education system in Morgan Hill.


Kelly Yip-Chuan

A REALTOR®, mother of 3 children in Milpitas schools, and a former PTA President, Kelly Yip-Chuan is a qualified candidate.


Want to help share this info? Click here to download our Voter Guide PDF


UPDATE 7/31/2018: 

Thank you! More than 129,000 REALTORS sent over 423,000 emails to Senators and members of Congress asking to extend the National Flood Insurance Program (NFIP). Today, that effort paid off!

Under legislation passed by the U.S. Senate today, NFIP will continue renewing or issuing new insurance for four more months. The bill, which cleared the House last week, is expected to be signed into law shortly (before tonight’smidnight deadline).  

We applaud lawmakers for taking this needed action to prevent disruptions to closings in thousands of communities across the country. Now extended through November 30, 2018, the NFIP is in desperate need of reforms that will make the program solvent and sustainable in the long run. The National Association of REALTORS will continue fighting for these reforms as the next NFIP reauthorization discussions loom later this year.

Thank you again for taking action on this critical legislative victory for our real estate industry!


The National Flood Insurance Program (NFIP) will expire on July 31, denying necessary insurance coverage to homeowners and buyers in more than 20,000 communities nationwide. Congress must act now to reform and extend the NFIP.

Urge Congress to extend the NFIP and pass meaningful reforms to ensure long-term viability of the program.

SCCAOR supports:

  • Reauthorizing and gradually strengthening the NFIP so it is sustainable over the long run;
  • Encouraging the development of private market options to offer comparable flood insurance coverage at lower cost than NFIP;
  • Providing federal assistance to high-risk property owners, including guaranteed loans, grants and buyouts in order to build to higher standards and keep insurance rates affordable;
  • Provide fair flood insurance rates that better reflect the property’s flood risk;
  • Improving flood map accuracy, so fewer property owners have to file expensive appeals.

Tim Beaubien has joined the Santa Clara County Association of REALTORS® (SCCAOR) as their new Government Affairs Associate. Beaubien will be working under our Government Affairs Director, Christina Garavaglia, and will be focusing his advocacy efforts on San Jose.

“Tim is an excellent addition to our Government Affairs team,” said Garavaglia. “Also coming from a municipal background, Tim understands the protocol and process of city government and will be a strong advocate for REALTORS® in San Jose.”

A graduate of the University of Arizona, Tim studied Public Management and Policy. He recently worked in the City Manager’s Office for the City of San Marino, located in Los Angeles County.

“I am excited to take on this role and use my experience to help strengthen the advocacy program here at SCCAOR,” said Beaubien. “I look forward to building relationships with our members as well as local government officials.”

With housing being the hot topic, both locally and statewide, SCCAOR Leadership acknowledged that now is the time to grow the Government Affairs department by bringing on a Government Affairs Associate. Many cities in our jurisdiction are having issues come up that have the potential to further impact the housing crisis here. By creating the associate position, SCCAOR will be able to double down on our advocacy presence.

“Over the last two years, REALTORS® and property owners have been under attack,” said SCCAOR CEO Neil Collins. “I want to thank the SCCAOR Leadership Team for allocating the resources needed to expand our Government Affairs Department so that we can create a more favorable business environment for our members.”

In his free time, Tim enjoys playing sports and going to the gym. He has spent many summers traveling with his father to different Major League Baseball stadiums around the country. “We’ve been to 18 different stadiums so far,” he said. “Last summer we visited Kauffman Stadium in Kansas City and Busch Stadium in St. Louis. Our goal is to eventually visit all 30 ballparks.”

For more information, visit our Government Affairs page.


UPDATE 6/1/2018: Thank you for responding to our Red Alert! AB 2364 was killed in the Assembly on Thursday.


SCCAOR opposes AB 2364 (Bloom and Chiu), which deters property owners from returning to the rental housing business for 10 years. AB 2364 significantly weakens the Ellis Act by discouraging new rental housing investment and will ultimately make the state’s housing crisis even worse. AB 2364 will be considered by the entire Assembly this week.

Action Item

Call 1-800-798-6593 and enter your NRDS ID (or your Legislator’s 4 digit code in the table below) followed by the # sign to be connected with your legislator’s office.

Ask your Assembly Member to vote NO on AB 2364.

Click here for a full list of Assembly Members

Issue Background

In 1985, C.A.R. successfully sponsored the Ellis Act, which is a bipartisan compromise reached by the Legislature to allow rental property owners to go out of business. Prior to the Ellis Act, unlike any other business, rental property owners were forced to stay in business, even when subjected to extreme financial conditions. The Ellis Act provides a reasonable solution that gives certainty to both rental property owners and tenants alike.

Specifically, the Ellis Act requires a property returned to the rental market before a 5-year period expires to include any deed-restricted or rent-controlled units previously located on the property. C.A.R opposes AB 2364 because, among other things, it seeks to weaken the Ellis Act by discouraging rental property owners from returning rental units to the market by effectively extending this 5-year period to 10 years.

 

Why We Are opposing AB 2364

  • Discouraging investment in rental housing is bad policy. AB 2364 will have a chilling effect on the state’s housing supply crisis. Substantially diminishing a rental property owner’s ability to return their property to the market will not only limit the number of available units, but also adversely affect property values and the ability to finance property.
  • Rental property owners cannot see TEN YEARS into the future. Existing law sets reasonable and foreseeable standards for rental property owners and tenants. AB 2364 imposes unreasonable constraints on rental property owners who simply want to return their property to the market after 5 years.

 

Questions?  Please contact chrissy@sccaor.com

 

This is an urgent call to action!

Where: San Jose City Hall
What:   City Council Meeting
When:   April 24th at 3:00 PM

Dear SCCAOR Members,

Coming before the San Jose City Council on Tuesday, April 24th will be a bevy of housing issues including amendments to the Tenant Protection Ordinance (TPO), the Apartment Rent Ordinance (ARO), and the Ellis Act. Of primary concern are the proposed amendments to the Apartment Rent Ordinance (ARO) and the Ellis Act.

The amendments to the ARO, which regulates the affordable housing market (units built in or prior to 1979 and are subject to Rent Control) in San Jose, would severely limit the ability for property owners with master-metered units to pass on utility costs incurred by the tenants.

The City Housing Department is making the following recommendations regarding the Ratio Utility Billing System (RUBS):

  1. Determine that RUBS is not allowed in San Jose.
  2. Allow landlords with written utility pass through contracts for water, sewer, and/or garbage in place prior to January 1, 2018, to petition for a one-time rent increase equal to the lesser of:
      1. The average monthly charges for water, sewer and/or garbage passed through to the tenant over the 2017 calendar year; or
      2. An amount equal to the sum of the 2018 Santa Clara County Housing Authority
      3. Utility Allowance rates for multifamily water, sewer, and garbage costs; and
  3. Allow landlords with written gas and/or electric pass through contracts in place prior to January 1, 2018 to petition for a one-time increase if a landlord’s units are not separately metered for gas and electricity and the landlord has complied with the requirements of Civil Code Section 1940.9. The increase shall be the lesser of:
      1. The average monthly charges passed through to the tenant over the 2017 calendar year; or
      2. An amount equal to the sum of the 2018 Santa Clara County Housing Authority Utility Allowance rates for multifamily gas and electric costs.

These recommendations are violations of YOUR property rights and those of your clients. They interfere in the contractual relationships between property owners and their tenants, and inhibit the ability for property owners to turn a profit. This will only encourage these units to be pulled from the market whereby decreasing the supply of valuable affordable housing.

What SCCAOR is proposing instead:

1) Keep RUBS as is until a technological alternative is developed that is cost effective to implement.
Right now, it would cost up to $15,000 per unit to install sub-meters. This is simply not a reasonable cost to incur without the ability to recoup the cost. With the 5% rent increase cap, it is impossible to factor costs of this scale into the allowable rent increase.

2) Develop a strategy and a reasonable timeline to retire RUBS only after the cost-effective alternative to sub-metering has been developed.

RUBS is a system utilized by mom and pop housing providers that allows for tenants in master-metered units to pay their fair share of utility costs that THEY incur. Without RUBS, what incentive will tenants have to act responsibly when it comes to utility usage? What about water conservation? Energy efficiency? Without skin in the game, there is no incentive.

The one-time pass-through which the Housing Department is proposing is not a solution. It is a band aid that will only kick the can down the road or force housing providers to incur and absorb unreasonable costs associated with switching to sub-meters.

We need to ensure that the San Jose City Council doesn’t fall for this trick. Let’s remind San Jose City Council that property rights matter and that the REALTO voice is strong.

The second matter of concern coming before City Council on April 24th is an amendment to the Ellis Act (the provision that guides and regulates removal of ARO units from the market) which changes amends the re-control provisions. Re-control is the part of the Ellis Act which dictates how many units MUST come back to the market as affordable units.

The Housing Department is proposing the following Ellis Act amendments:

  1. Modify the re-control provisions to subject the greater of either the number of apartments removed from the market, or 50% of new apartments built to the Apartment Rent Ordinance (ARO).
  2. Modify the re-control provisions to subject all new units (not just the affordable units) to the current annual general increase of 5%.
  3. Allow an exemption from the re-control provisions if at least twenty (20) newly constructed rental units are being created. The re-control requirement under this Section will be waived if the property owner:
    1. Develops fifteen percent (15%) of the newly constructed units as on-site affordable rental units consistent with the affordability restriction requirements in the Inclusionary Housing Ordinance; and
    2. Develops an additional five percent (5%) of the newly constructed units as on-site affordable rental units restricted at 100% of area median income.
  4. Include apartments buildings with three units under the Ellis Act.
  5. Allow non-ARO apartments with three units or more built after 1979 to provide 120-day notification to their tenants and the City and to provide relocation consultant services to impacted tenants.

What SCCAOR is proposing instead:

  1. Reject staff recommendation #1 and replace with: Subjecting new units to re-control at the greater of a 1:1 replacement ratio of the previously existing number of units; OR, 20% of the total project units.
  2. Support staff recommendation #3: allow an exemption from the re-control provisions if at least twenty (20) newly constructed rental units are being created. The re-control requirement under this Section will be waived if the property owner:
    1. Develops fifteen percent (15%) of the newly constructed units as on-site affordable rental units consistent with the affordability restriction requirements in the Inclusionary Housing Ordinance; and
    2. Develops an additional five percent (5%) of the newly constructed units as on-site affordable rental units restricted at 100% of area median income.
  3. Reject staff recommendations #2, #4, and #5

The reasoning is that by limiting the required number of units subject to re-control to 20%, it aligns with existing requirements in the Inclusionary Housing Ordinance. Also, maintaining an option for developers an option for exemption from the re-control provision is a step in the right direction.

The remainder of the Housing Department’s recommendations however, are just attempts to start pushing rent control on market rate units. This is an unacceptable assault on private property rights.

Join SCCAOR on Tuesday, April 24th to protect private property rights and mom and pop businesses from predatory regulations.

Your Role: you will have 2 minutes to advocate for the REALTOR® position on the proposed violations to your property rights.

 

Christina Garavaglia-Branche

The Santa Clara County Association of REALTORS® (SCCAOR) has announced the hiring of Christina Garavaglia-Branche as their Government Affairs Director. Christina will manage SCCAOR’s legislative and political affairs program in developing local, regional, state and federal public policy governing private property ownership and other related issues.

“I am excited to join SCCAOR and work on behalf of its members to meet their political needs as real estate professionals,” said Garavaglia-Branche. “I look forward to using my experience in politics and housing policy to facilitate lasting relationships and strengthen SCCAOR’s voice and influence in the community.”

Garavaglia-Branche’s local political experience will be a huge benefit for SCCAOR’s goal of promoting and protecting private property rights. Christina was Dev Davis’ Campaign Manager during her successful run for the District 6 City Council in 2016. Christina then worked as a Policy Liaison for Councilmember Davis. Prior experience includes working as legislative staff at the California State Assembly where Christina focused on statewide Housing and Economic Development Policy.

SCCAOR CEO Neil Collins is also pleased with the Association’s newest addition. He said of Garavaglia-Branche’s hiring, “She brings a wealth of political knowledge to the table. There is no bigger issue than the lack of housing in Santa Clara County so I knew we needed to hire a professional with real housing policy experience. It’s great to have someone like Christina fighting for the REALTOR® Party.”

One of her first tasks as Government Affairs Director will be to lead a group of SCCAOR Members to Sacramento for California Association of REALTORS® Legislative Day. Over 2,000 California REALTORS® will come together for the opportunity to meet and discuss real estate issues directly with their state legislators and staff.

 

George and Grace

A graduate of San Jose State University (Go Spartans!), Christina enjoys calligraphy, horseback riding, and photography. She lives with her husband Matt and their two dogs, George and Grace in South San Jose.

 

For more information about SCCAOR Government Affairs, visit our website.