Government Affairs Hot Topics

Government Affairs Hot Topics

CCAR Works with City of Pinole on POS Balcony Ordinance

The City of Pinole initially introduced the ordinance language on May 2, 2017, notifying CCAR that the ordinance would be for the sole purpose of disclosing and recommending that homeowners conduct an inspections of any balcony on the property prior to close of escrow.

However, the ordinance language as it was written would have held up the transaction in escrow and included an addition to the rental inspection program providing City Staff the ability to inform the unit owner of a periodic balcony inspection that would need to be conducted by a licensed general contractor, structural pest control licensee, licensed architect, or licensed engineer.

During the May 16, 2017 council meeting, a representative of the Board of Directors attended and presented to the Council portions of the ordinance that would in fact hold up the transaction, causing the City Council to pull the item from the consent calendar and hold a discussion.

Prior to the next council meeting members of the CCAR Board of Directors and the Government Affairs Department met with each City Councilmember, Mayor and City Attorney separately to discuss the ordinance and its language. Because of these meetings and the City Council’s willingness to hear from CCAR, the ordinance language was modified to not hold up the transaction process. However, while the Council made the recommended changes to the point of sale portion of the ordinance, they were not willing to remove the rental inspection addition at this time.

The Forms Committee is in the process of adding language to the CCAR Disclaimer and Disclosure Advisory and the City of Pinole Addendum which will be made available to membership upon approval.

Should you have any questions regarding this ordinance, please contact your Government Affairs Director, Heather Schiffman at 925.295.9232 or at [email protected].

Red Alert! - C.A.R. is OPPOSING AB 2502 (Mullin),

5/23/2016 - C.A.R. is OPPOSING AB 2502 (Mullin), a bill that would weaken the rent control limitations contained in the landmark “Costa-Hawkins” law sponsored by C.A.R. in 1995. C.A.R. opposes AB 2502 which undermines existing Costa-Hawkins’ protections by allowing local governments to impose mandatory inclusionary zoning (i.e. rent control) on newly constructed rental housing, without any consideration for the economic viability of the project.

AB 2502 effectively repeals part of the C.A.R. sponsored Costa-Hawkins legislation that says new construction in a rent control jurisdiction is exempt, or NOT subject to rent control. It is vitally important that you reach out to your elected representative today!

Action Item
Call Tony Thurmond today at 1.800.798.6593
Enter your PIN number 5984 followed by the # sign
Urge him to oppose AB 2502

Mortgage Forgiveness Tax Treatment Gets One More Year

1/3/2013 - While there is still very little focus on the importance of this law, the fiscal cliff deal did extend its provisions for one more year. The law – which was set to expire at the end of 2012 - is crucial to foreclosure mitigation efforts such as principal forgiveness and short sales.

Normally, U.S. law decrees that when a lender forgives all or a portion of a borrower’s debt, the forgiven amount is considered taxable income for the borrower. This is known as Cancellation of Debt (COD) Income and must be included in a taxpayer’s gross income. This Act, however, created an exception to this rule under the U.S. Tax Code. The Mortgage Forgiveness Debt Relief Act allows homeowners who received principal reductions or other forms of debt forgiveness to not pay taxes on the amount forgiven. The amount extends up to $2 million of debt forgiven on the homeowner’s principal residence.
For homeowner’s to qualify, their debt must have been used to “buy, build, or substantially improve” their principal residence and be secured by that residence. The law, which was passed in 2007 with a 5 year sunset provision, will now be in effect until January 1, 2014.

As for the status of California conforming to Federal law, in 2008 California enacted and C.A.R. supported SB 1055 (Machado) which provided conformity with the federal statute for the 2007 and 2008 tax years and, in 2010, C.A.R. supported and California enacted SB 401 (Wolk) which extended the income tax debt forgiveness until December 31, 2012, conforming to the federal law. C.A.R. sponsored AB 2225, as a potential vehicle with which to conform state tax law to federal law, if and when the federal government extended the mortgage debt forgiveness sunset date.

Call for Action: Do No Harm to Housing!
12/7/2012 - By now you have seen numerous news reports concerning the "Fiscal Cliff." Many of these reports speculate that a change to the long-standing policy that allows homeowners to deduct mortgage interest payment from their income taxes could be part of a "Fiscal Cliff" deal.

CCAR and NAR´s position is that the mortgage interest deduction is vital to the stability of the American housing market and economy and we will remain vigilant in opposing any future plan that modifies or excludes the deductibility of mortgage interest.Please send a short message to your Senators and Member of Congress to remind them where REALTORS® stand and that we will be watching to see who stands with us.Click here to send a message.

Big Win: 5-Year Flood Insurance Re-authorization 

7/10/2012 - On Saturday, June 30, President Obama signed a one-week extension of a transportation bill that includes a provision to extend the National Flood Insurance Program (NFIP) for five years, ending four years of short-term extensions that fueled uncertainty and several lapses in coverage.  Without the five-year extension, the program would have expired July 31.

Flood insurance is required by law to obtain a mortgage in more than 21,000 communities nationwide. NAR estimates that a lapse in the program would have affected 1,300 transactions a day or nearly 40,000 a month. 

The extension of the measure will allow time for the full legislation, approved last Friday by Congress, to reach the president’s desk.  He is expected to sign the full law in the coming days.

C.A.R. and NAR have been working over the past several years to ensure lawmakers understand the importance of extending the NFIP and will continue to monitor the issue.

C.A.R. Opposing Conference Report that STALLS Housing Recovery

6/29/2012 - C.A.R. is OPPOSING a conference report, AB 278, containing anti-foreclosure legislation sponsored by the state Attorney General. C.A.R. opposes provisions in this measure which will allow anyone to stop the foreclosure process by filing a lawsuit, merited or not. C.A.R. agrees that careful and balanced reforms to the foreclosure process are necessary. However, C.A.R. opposes this conference report because it will further delay the housing recovery by inviting bad-faith lawsuits and defaults, and making it difficult for even well qualified borrowers to obtain financing. Financing is already very difficult to get. This conference report will only make a difficult situation worse.

Initially the Attorney General had sponsored a package of bills; the so-called the “Homeowners Bill of Rights.” For procedural reasons, the majority of these bills have been under consideration by a Conference Committee made up of six legislators. REALTORS® had the opportunity to educate these legislators about C.A.R.’s concerns as part of Legislative Day and since then C.A.R. lobbyists have been working directly with the conferees and legislative staff to make them aware of the unintended consequences of some of these proposals. The Conference Committee has now issued its final report and it must be passed by both Houses of the legislature. These votes may occur as early as Monday, July 2nd.

Action Items
Please call your state Senator TODAY! Call 1-800-969-3310 and enter your NRDS ID followed by the “#” sign to be connected.

Ask your Senator or his or her staff to vote NO the conference report.

Please note: C.A.R. is only targeting Democratic Senators for this mobilization effort. If you live in a state Senate district represented by a Republican you may not be connected to your legislator’s office.

The Attorney General has sponsored a package of bills to place into California law an expanded version of the national settlement between major banks and state attorneys general. The contents of some of these bills have been under consideration by a Conference Committee comprised of six members who have just approved a conference report on a party-line vote. Some provisions will have the unintended effect of drying up mortgage loans for anyone but the most well-qualified borrowers, and increasing the costs of all mortgages.

One provision allows any borrower, no matter what the circumstances, to file a lawsuit. This will encourage opportunistic lawyers to pursue frivolous lawsuits, bringing unnecessary and unjustifiable delays to an already difficult and time consuming process. The language is so vaguely written that the borrower doesn’t even have to show that they have been harmed to file suit and be awarded damages. One-sided attorneys’ fees may still be awarded only to plaintiffs based on the very broad definition of a “prevailing party” in the report. And, of course, if lenders don’t have the remedy of foreclosure to ensure they can recover their security in appropriate situations, they will be less likely to lend, credit will be less available and the housing market recovery will limp along even more slowly.

C.A.R. is OPPOSED to the conference report because:
• The housing market recovery is still fragile. About half of all sales are of distressed properties. By restricting a lender’s ability to foreclose and exposing them to unnecessary liability, this report will dry up inventory, and it will further discourage lending other than to the most highly qualified borrowers. Additionally, these bills will artificially slow down the foreclosure process, keeping properties off the market that are legitimately in foreclosure. Finally, by removing the threat of foreclosure, the bill erodes the incentive for short sales as well.

• The bill invites bad-faith defaults and lawsuits. By broadly defining under what circumstances a lawsuit can be filed, even those legitimately in foreclosure can “game” the system. Additionally, the bill creates an incentive for plaintiffs’ attorneys to file frivolous lawsuits even if no harm has been done to the borrower. The courts are already overwhelmed. This bill, by inviting frivolous lawsuits puts an additional strain on the already underfunded courts

• Lending is already tight. Even the best qualified borrowers are finding it difficult to obtain financing. By stopping legitimate foreclosures, banks will be forced to further tighten lending standards at the expense of homebuyers.

C.A.R. and CCAR Opposed Transfer Tax ($225 per Transfer)

4/17/2012- CCAR would like you to know that C.A.R. has reached an agreement with Senator DeSaulnier on its amendments removing our opposition by making it clear that Senate Bill 1220 does not apply to transfers/sales of real property and will not impose a transfer tax in the form of a point of sale document recording fee. With these amendments, CCAR and C.A.R. are now supporting the measure.

This is a win for you and your clients. Thank you very much for responding to this red alert and to help C.A.R. successfully negotiate to have the transfer tax provision removed from SB 1220.

3/20/2012- Senator DeSaulnier has introduced SB 1220 to permanently fund an affordable housing trust fund. Unfortunately, SB 1220 creates a real estate transfer tax of $75 per document to fund this program. In virtually all transactions a minimum of three documents are recorded – the grant deed, the release and reconveyance and a trust deed. SB 1220 will create a minimum $225 transfer tax and the amount may go higher depending on the number of documents recorded.

While SB 1220 has not yet been scheduled for a hearing, it’s important to educate legislators as soon as possible.

Over the last several decades, state and local agencies and organization have created affordable housing programs. Historically, state and local affordable housing programs have been funded through state bonds such as Prop 1C and Prop 46, or through local redevelopment agencies, among other sources. The funds generated from these bond measures have been exhausted, and local redevelopment agencies no longer exist. It is unlikely that future bonds will be viewed favorably by California voters given the current state of government finances and public’s concern over fiscal accountability. Therefore affordable housing groups have been seeking a permanent funding source for these programs and have unfortunately settled on SB 1220.

C.A.R. is opposing SB 1220 because:
SB 1220 targets one group (homebuyers) to pay for affordable housing which is an issue of broad social concern. While there may be a need for affordable housing funds, it is unfair to require only those individuals recording real estate documents to be the sources of that funding. The lack of sufficient affordable housing is a statewide concern. As such, if it is deemed necessary to implement some type of funding mechanism to generate funds for affordable housing, that mechanism should be as broad based as possible. It is simply unfair that SB 1220 seeks to fund affordable housing at the expense of home buyers. An affordable housing advocate suggested that C.A.R. could support SB 1220 if the tax applied to ALL recordings and not just those pertaining to real estate. WRONG! The concern remains the same. Even if the tax were applied to all recordings, only a relatively small group of citizens, namely those recording real estate documents, would still be taxed for a program that should be supported by all Californians.

SB 1220 increases the already substantial cost of buying a home. Many cities already have local transfer taxes. SB 1220 creates an additional transfer tax of $225 on almost all real estate transactions, including refinances, adding to the already substantial fees and taxes already paid by homebuyers. Keep in mind that every $1,000 increase in the median price of a home disqualifies almost 20,000 California households from affording homes.

• While C.A.R. adamantly supports the creation of homeownership opportunities, SB 1220 is clearly not the way to achieve this goal.

Please make the call today to State Senator Mark DeSaulnier and tell him that you are opposed to SB 1220!

District Office: (925) 924-6082
Capitol Office: (916) 651-4007 

Contra Costa County Water Iniative Ballot

3/7/2012- Earlier this year, the Contra Costa County Board of Supervisors approved a county-wide initiative that would help fund the Clean Water Program. Property owners have received ballot for each parcel in the mail from the Contra Costa Clean Water Program. The envelope looks as though it is junk mail; however, that is not the case. The monies from the initiative would be used, as federally mandated, to clean water and maintain pollution control services, create facilities to protect local waterfront contamination and pollution, remove harmful and dangerous pollutants, capture clean rain water and use it to irrigate parks and lawns, and would help maintain a clean Delta and Bay Shoreline. Should the initiative be approved by a majority of home owners in the County, each parcel would have an annual fee for 10 years added to their property taxes. The fees would range from $9 - $22 dollars depending on location in the county and the type of dwelling. For example, should you reside in Walnut Creek and own a Town House, your annual could be $11.00, but if you live in Walnut Creek and own a House, your annual could be $22.00.

This program is federally mandated, similar to that of the Sewer Lateral Lines in Alameda and West Contra Costa, and if the initiative does not receive the required voter approval, the County and Cities could be fined up to $10,000 a day which would be paid out of the General Fund until the project gains approval or monies are found to fund the project. If none of the above occurs, the county would be required to look for alternate routes to save money.

The ballot must be received before April 6, 2012.

Orinda's Temporary Sign Ordinance

2/28/2012- The Orinda City Council recently began the review process of the City’s Temporary Sign Ordinance. CCAR Board of Director’s President, Barbara Safran and your Government Affairs Team met and worked with the Orinda City Manager and their staff to keep the sign ordinance as is. Orinda City staff previously made new recommendations which would preclude real estate temporary signs in the downtown portions of Orinda, including Camino Pablo/Moraga Way. Due to response and support by the real estate community and the support of the City Council, it was agreed that an unlimited amount of temporary signs should be allowed anywhere in Orinda for twelve hours a day.  On March 20, 2012, at 7pm, the Orinda City Council will take their final vote to approve the sign ordinance. Thirty days following that vote, the sign ordinance will take affect.

East Bay Municipal Utility District (EBMUD) Private Sewer Lateral Program
The United States Environmental Protection Agency (EPA) is spearheading an effort to keep the San Francisco Bay clean by requiring EBMUD, several East Bay cities and one sewer district to fix old, cracked sewer pipes to ensure they don’t allow the infiltration of rainwater which can overwhelm wastewater treatment facilities, resulting in untreated and partially treated sewage being released into the Bay.

East Bay Regional Private Sewer Lateral Program Brochure

State Responsibility Area Fee Regulation
During C.A.R’s Board of Directors Meeting in San Jose 2011, it was approved that C.A.R “SUPPORT” legislation that would eliminate the State Responsibility Area Fire Prevention Benefit Fee.

CA State Board of Forestry and Fire Protection, News Release
Capitol Alert: State Board Approves maximum $90 fee on rural homeowners
CA State Board of Forestry and Fire Protection, Regulation Language

Gas Shut-Off Valve
In 2010 the CCAR Government Affairs Team asked the county to review and re-consider the gas shut-off valve point of sale requirement that each gas appliance in the building have a valve installed. The Contra Costa County Board of Supervisors approved a change to the County’s Gas Shut-Off Device Ordinance. With the change the shut-off devices are only required at the main gas service.

Although this was a change in the right direction, the gas shut-off is still a hot topic and is continually being considered.

If you have any questions, please contact Heather Schiffman, Government Affairs Director at 925.295.9232 or by email at [email protected]