California Apartment Association

By MIKE NEMETH

While Proposition 30 will slow the furious pace of budget cuts, California lawmakers won’t throw away the chopping block, a lawmaker projected earlier this month.

Assemblyman Henry Perea, D-Fresno, said the state will continue to rein in spending, albeit with less urgency. California voters approved Prop. 30 in November, raising the state’s sales tax by a quarter cent on the dollar. It also boosted income taxes for those earning more than a quarter-million dollars per year.

“If it weren’t for the proposition passing, we’d be having a very different conversation this morning about the state of our affairs here in Sacramento,” Perea said.

The Central Valley lawmaker, along with Assembly Majority Leader Toni Atkins, D-San Diego, and Sen. Mark DeSaulnier,  D-Concord,  spoke to members of the California Apartment Association on Feb. 13 during CAA’s annual Legislative Conference.

In the afternoon, CAA members fanned out across the Capitol to connect with legislators and discuss potential bills with implications for the rental housing industry, from a possible ban on smoking to forcing landlords to pay renters’ interest on security deposits.

The morning lectures, however, focused more on general legislative topics, including the impact of the Democratic supermajority and the issues most likely to dominate debate in Sacramento this year, including water, revising the California Environmental Quality Act and preparing for the implementation of federal health care reform.

Perea said California doesn’t have enough physicians – especially in rural areas — to accommodate the number of patients who’ll obtain health care insurance under the Patient Protection and Affordable Care Act.

While newly minted doctors might prefer practicing medicine in metropolitan areas, an opportunity to take out a chunk of student debt could nudge them to places like Fresno County – at least for a little while, he said.

‘Mods’ a different kind of Dem?

“One of the things we’re looking to do this year is to provide incentives, that would provide scholarships to people who commit to serving at least three years in an underserved community to help them pay off their tuition,” said Perea, who identifies himself as a “Mod,” short for moderate Democrat.

During the November election, Democrats won a supermajority in the California Legislature. While Perea said he’s a moderate, the assemblyman emphasized that he and other mods are still Democrats at their core, holding a set of political beliefs distinctive of the party.

He was quick to add, however, that moderates approach their work in Sacramento from a perspective of balance and compromise.

“What we don’t like is when the far left and the far right drive the conversation because we think that ultimately that’s how bad policy is done,” Perea said. “In fact, that’s how we got to the place where we are today.”

Thoughtful session projected

Assemblywoman Atkins predicted a year in which lawmakers take on big issues but proceed with thoughtfulness.

“It’s good to have a balanced budget. It’s good to have the ability to do things we need to do,” she said.  “But we also have to be very thoughtful and very mindful. And I want to assure you I don’t think crazy things are going to happen.”

Atkins also emphasized the need for affordable housing, pointing specifically to cities such as San Diego, Los Angeles and San Francisco, headquarters to some of California’s most significant businesses and institutions – and major tourist draws.

To keep such cities viable, Atkins said, metro areas need affordable housing for working folks, ideally along transit corridors and in urban areas, helping prevent suburban sprawl and transportation challenges.

“It’s really important that we have the kind of housing that lends to our population, that brings all this stuff together,” she said.  “Apartments address all of these goals, so I want to thank you for actually being part of the solution.”

She put some numbers into perspective, saying that the state closed a $20 billion structural deficit over the past several years and that by 2016 – if all goes as planned – the state should have a $2 billion reserve.

Landlords ‘on the fault line’

“As apartment owners, people who’ve invested your savings and your sweat and your blood in the assets that you have, from small properties to large properties, I know that you are right there on the fault line, if I could use that phrase in California, of how things can go,” Atkins said. “I want you to know that a number of us are really mindful of that. I hope that this is going to be a year of thoughtful approaches to legislation as well as the budget.”

Added DeSaulnier, “It’s sort of wonderfully surreal and a little hard to accept that we don’t have a huge deficit.”

DeSaulnier, who spoke in place of Gov. Jerry Brown, who was in Southern California attending the funeral of slain Riverside Police Officer Michael Crain, touched on multiple topics, including his optimism on reforming CEQA.

“I think you can fix CEQA by fixing the front end and changing the back half to make it easier for developers to come in and engage with the community,” said the lawmaker, who helped close his speech with a touch of perspective for the Golden State.

“In spite of all of our challenges,” he said, “for the rest of the world, California is still a mythical place where dreams come true.”