Officials who manage tax revenues in three counties came out against Proposition 33 on Tuesday, a ballot measure that seeks to repeal rules prohibiting rent control for much of California’s housing stock.
The officials from Alameda, San Diego and Riverside counties warned in an exclusive statement to The Sacramento Bee that if approved, Prop. 33 could cut funding for schools and emergency services in their communities.
According to the nonpartisan Legislative Analyst’s Office, Prop. 33 could lead to a “reduction in local property tax revenues of at least tens of millions of dollars annually” in some communities if they enact new rent control laws.
Prop. 33 would make it easier for cities and counties to enact rent control on apartments and single family homes. The LAO wrote that if more housing units become rent controlled, it could cause ripple effects including fewer renters moving and more landlords selling their rentals.
“The value of rental housing would decline because potential landlords would not want to pay as much for these properties,” the LAO wrote .
Proposition 33 explained: What California’s rent control ballot measure is asking you
That could cause property values to drop and a decline in property tax revenues, which fund schools and county services.
“Property taxes are Riverside County’s largest local source of revenue, funding everything from public safety to mental health and fire protection,” said Ben Benoit, Riverside County Auditor/Controller. “Proposition 33 would lower property values and limit our county’s ability to fund these critical services.”
“Proposition 33 would hurt homeowners and lead to less property tax dollars to fund our vital first responder services and schools,” said Jordan Marks, the San Diego County Assessor/Recorder/County Clerk. “If Proposition 33 passes, San Diego County and cities across California will be faced with making cuts to vital services or raising taxes to make up for the budget shortfalls created by Proposition 33.”
“From a fiscal perspective, Proposition 33 will cost our county millions of dollars, impacting our ability to invest and maintain essential local services like public schools, health care, roads, public safety, libraries, and other vital services our residents depend on,” said Phong La, Alameda County Assessor.
But a spokesperson for the Prop. 33 campaign said in an email to The Bee that if approved, the measure will allow local governments to choose whether or not to enact or expand rent control.
“The largest number of renters live in Los Angeles and San Francisco, which already have rent control (for apartments built before) 1978 and 1979, respectively. When 33 passes, they will be free to expand that,” spokesperson Jacki Schechner said.
“However, if Alameda, San Diego, and Riverside don’t choose to enact rent control, then it won’t be an issue,” she said.
Schechner added the “small reduction” of tens of millions “will be more than made up for in fewer people being in homeless programs” which have cost the state roughly $24 billion over the past five years.
Prop. 33 would repeal California’s Costa-Hawkins Act, which bans rent control for single family homes and rental units built after 1995. Opponents of Prop. 33 warn it would make it easier for cities and counties opposed to new housing to flout state housing laws.
The measure is being bankrolled by the AIDS Healthcare Foundation, which pushed similar ballot measures in 2018 and 2020..
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