California Rent Control Backers Say They Aren't Giving Up After Latest Election Defeat

After a third defeat at the ballot box and the potential success of a so-called revenge proposition, supporters of an effort to allow local influence over rent control for apartments say they’ll be back.

Proposition 33, which would have repealed California’s Costa-Hawkins Act, a law that limits local governments’ authority over rent control, was soundly defeated in the Nov. 5 election, with about 60% of voters rejecting the measure.

The proposition was sponsored and mostly funded by the AIDS Healthcare Foundation, which placed similar measures on the ballot in 2018 and 2020. A third loss hasn’t deterred supporters, though. 

“This is going to move forward in one iteration or another in terms of making sure that more renters are covered under rent control,” Yes on 33 campaign manager Susie Shannon told Bisnow. 

While there are no immediate plans to bring this issue back to the ballot, Shannon did not rule it out. 

The coalition will not attempt a ballot measure again while Gov. Gavin Newsom is in office, Shannon said, but after that, she left the door open.

The governor came out against the proposition, which the California Democratic Party endorsed. Newsom’s term ends in 2026, which is the next time California voters will return to the polls.

Proposition 33’s supporters might need that time to build up the necessary support if they hope to pass their bill.

“It takes a long time to build support and we're in that process,” Shannon said. 

Shannon pointed to the push to repeal Costa Hawkins as part of a larger movement to help mitigate housing costs for California renters, who are undeniably facing a housing affordability issue that drives people from the state and fuels the homelessness crisis. 

AHF President Michael Weinstein similarly vowed to keep trying.

“The battle for justice for renters marches on,” he said in a statement. 

Though the state’s affordability woes are still prevalent since the previous attempts to undo Costa Hawkins, the measures have failed to break through with the needed majority of voters. In both previous elections, the propositions were opposed by approximately 59% of voters – roughly the same amount that opposed it in the election earlier this month. 

“I would hope this would be the last [effort] after the voters have rejected it three times,” California Chamber of Commerce President and CEO Jennifer Barrera said. The chamber was among the top funders of the No on 33 campaign. 

In 2018 and 2020 combined, spending on campaigns over the propositions totaled more than $239M. This year, it is estimated that a total of $175M was spent on the campaign by both sides, with the No on 33 side spending $125M. 

If a similar proposal were to return on a future ballot for a fourth time, Barrera said she and others in the No on 33 coalition would be prepared to oppose it.  

The AIDS Healthcare Foundation did not respond to questions about whether it would put money behind a proposition aimed at increasing housing affordability another way since this route to addressing high housing costs has not yet been successful. 

Another proposition could make a major decision for AHF, however. 

A number of news organizations have called the close race for Proposition 34, which AHF termed a “revenge” initiative, in favor of its passage. The proposition would “change the state’s rules for healthcare providers [such as AHF] participating in the federal 340B drug discount program in ways that seem designed to cut off the foundation’s tenant advocacy,” the Los Angeles Times reported. 

Shannon, who is also the campaign manager for No on 34, was undaunted by the prospect of Prop. 34’s passage. 

“This fight [to expand rent control] is going to continue and I don't think Prop. 34 is going to stop that,” she said. 

AHF contributed more than 98% of the roughly $50M contributed in support of Prop. 33. Without its significant funds, the task would fall to others to organize the millions needed to get the word out about a ballot initiative and promote it. 

Hospitality union Unite Here Local 11 contributed $50K to the Yes on 33 campaign. Rent control and its expansion remain an important issue at the top of the union’s agenda, co-President Ada Briceño said.

Briceño could not yet say what steps the union might take to achieve the expansion of rent control, including whether it would step up to fill a funding gap that could be left by AHF. But she reiterated that the union remains “100% committed” to expanding local control over rent restrictions. 

“This is such a crucial issue, just like raising wages, and so we are going to be part of whatever tool is available to us to bring rent control to the jurisdictions that need it,” Briceño said.