Budget Update
On June 30, 2025, Governor Newsom signed Assembly Bill 130 and Senate Bill 131 into law, finalizing a broad legislative package intended to address permitting and approval delays under the California Environmental Quality Act (CEQA). While AB 130 focuses primarily on housing development and local permitting processes, SB 131 targets infrastructure, public facilities, and procedural CEQA changes. The bills aim to streamline environmental reviews by introducing exemptions and timelines, while preserving key safeguards and adding new labor and oversight requirements.
Beyond CEQA, AB 130 codifies several streamlining measures for housing approvals:
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Expands the Permit Streamlining Act to include ministerial housing projects and makes related timelines permanent.
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Caps the number of public hearings for qualifying housing projects at five.
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Makes permanent provisions of the Housing Accountability Act and Housing Crisis Act, including the builder’s remedy.
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Removes certain California Coastal Commission appeal rights for specific residential development proposals.
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Includes a moratorium on the adoption of new or more restrictive residential building standards at both the state and local levels. Effective from October 1, 2025 through June 1, 2031, the moratorium does not apply to updates related to emergencies, fire safety, or conservation.
Finally, AB 130 allows for an expansion of the renters tax credit—subject to future appropriations.
SB 131 requires housing projects to meet specific labor standards to qualify for CEQA exemptions. Public agency projects are required to use a skilled and trained workforce unless covered by a qualifying Project Labor Agreement (PLA), while private projects must certify prevailing wage payments and workforce standards, include these in all contracts, and submit monthly compliance reports—unless all contractors are under a PLA with arbitration enforcement. These provisions may increase labor costs and impose additional compliance obligations for qualifying projects.
Legislative Update
Second House Policy Committee Deadline Summer Recess Begins
The deadline for bills to pass the policy committees in the second house is July 18th and the Legislature is on their summer recess from then until August 18th. After that, the remaining legislative deadlines for the year are as follows:
● August 29th - Appropriations Committee Deadline in Second House
● September 12th - Deadline to Pass the Floor/Recess
● October 12th - Last Day for the Governor to Sign or Veto Legislation
To highlight additional legislative wins that we have had:
Senate Bill 436 (Wahab) - Right to Redeem Tenancy, which would have changed the 3-day pay or quit statute to a 14-day pay or quit, died in the Assembly Judiciary Committee. Although granted reconsideration, the bill was not set for a second hearing.
Additionally, Senate Bill 681 (Wahab) - Housing, the Senate’s housing reform proposal, which included provisions that limit fees that rental property owners may charge tenants which failed to get a hearing in the Assembly Housing Committee and now is a two-year bill.
Finally, Assembly Bill 1240 (Lee) - Corporate Ownership has become a two-year bill, parked in the Senate Judiciary Committee. AB 1240 would have prohibited business entities that own more than 1,000 single-family residential properties from purchasing any additional single-family properties and leasing them out.
Priority bills that are still moving, include:
AB 414 (Pellerin) - Residential Tenancies: Return of Security - This bill requires a property owner to return any remaining security deposit at the end of a residential tenancy to the tenant electronically if the tenant paid rent or the deposit electronically, and amends the process by which the remaining deposit and required itemized statement of deductions is delivered to the tenant or tenants, as specified. Senate floor amendments of 7/8/25 add an exception to the requirement that when multiple adult tenants reside in the residential rental property, the owner must return the remainder of any security deposit by check payable to all adult tenants and furnish the itemized statement to any one of the adult tenants, as specified, for when no written mutual agreement has been entered into by the landlord and the adult tenants, and the tenancy is terminated by a tenant pursuant to a specified statute related to instances of domestic violence, and the tenant who terminated the lease requests that the security be disbursed in a manner other than by check made payable to all adult tenants. With these amendments, CalRHA went neutral on the bill.
AB 628 (McKinnor) - Habitability: Stoves and Refrigerators - This bill makes a dwelling that substantially lacks a stove or refrigerator that are maintained in good working order and capable of safely generating heat for cooking or safely storing food untenantable. CalRHA is working with the author’s office on further clarifying amendments to the bill, which is pending a vote on the Senate Floor.
Assembly Bill 863 (Kalra) - Residential Rental Properties: Language Requirements - Requires a housing provider seeking to terminate a lease to provide the tenant with a notice in Spanish, Chinese, Tagalog, Vietnamese, or Korean, as well as in English, if the lease was originally negotiated in one of those languages, or if the provider has been notified by the tenant that one of those languages is the tenant's primary language. CalRHA is opposing AB 863, but amendments are being discussed with regard to a summons containing all languages. AB 863 will be heard next on the Senate Floor.
AB 878 (Kalra) - Reasonable Accommodations for Victims of Domestic Violence - Provides that an owner or an owners’s agent shall, upon request, provide a reasonable accommodation to a tenant who is a victim or whose family or household member is a victim of domestic violence, sexual assault, human trafficking, etc. The bill has been amended, but still contains a private right of action so CalRHA remains opposed. The bill is pending a vote on the Senate Floor.
Senate Bill 52 (Perez) - Rental Rate Algorithms - SB 52 restricts the use of rental pricing algorithms. Specifically, it bans offering such algorithms to competitors in the same or related market, prohibits knowingly using these algorithms, and forbids incorporating nonpublic competitor data into any rental pricing algorithm. CalRHA is opposed to SB 52, which is being heard on July 16th in the Assembly Privacy Committee.
Senate Bill 384 (Wahab) - Preventing Algorithmic Price Fixing Act: prohibition on price-fixing algorithm use - This legislation would ban the creation and employment of pricing algorithms that use the confidential, competitive data of rival companies. CalRHA is opposed to SB 384, which is being heard on July 16th in the Assembly Privacy Committee.
Senate Bill 522 (Wahab) - Housing: Tenant Protections - This bill excludes, from the exemption to California’s just-cause eviction protections for housing issued a certificate of occupancy within the last 15 years, housing that is built to replace a housing unit substantially damaged or destroyed by a disaster, as specified. Unfortunately, SB 522 will have the unintended consequence of discouraging the reconstruction of housing destroyed by disasters. CalRHA is opposed to SB 522, which will be heard next on the Assembly Floor.
