No on Proposition 10
Vote No on Proposition 10: It makes a bad problem worse
This fall, California voters will vote on Proposition 10, a measure that would open the door to radical rent control and make California’s current housing crisis even worse. The measure proposes to repeal the Costa-Hawkins Rental Housing Act of 1995, a bipartisan bill that placed limits on locally-enacted rent control laws.
Proposition 10 opens the door to radical rent control, and would further distort California’s already broken housing market. The California Chamber of Commerce urges all Californians to vote No on Prop 10 this fall.
Reasons every business should Vote NO on Prop 10:
- California has a critical shortage of housing – Prop 10 will make it worse by making it harder to build new affordable housing, driving landlords to take existing rentals off the market and putting more pressure on California’s broken housing market.
- Businesses need a place for new workers to live – Businesses across the state are having an increasingly difficult time finding places for workers to live. California’s high housing costs and limited supply put California businesses at a competitive disadvantage when trying to hire workers.
- Businesses will be asked to pay for higher housing costs – As California’s housing market spirals out of control, businesses are being forced to increase employee wages to cover the cost of basic housing. Proposition 10 will drive up housing costs even further, putting more pressure on businesses to increase compensation to their employees, and driving up the cost of doing business in California.
- Prop 10 could lead to new taxes – The Legislative Analyst’s Office (LAO) has warned Proposition 10 is likely to cost California state and local governments hundreds of millions of dollars in lost tax revenues. That will increase the pressure on future lawmakers to fill the gap with new taxes.
Price controls simply don’t work long-term. Rent control has contributed to price increases in some of the most expensive housing markets in the state including San Francisco, Santa Monica and Beverly Hills. If Proposition 10 passes, Housing will be harder to find for low-income applicants. Liberal and conservative economists alike have warned rent control leads to a reduction in housing supply, leading to more rental housing being taken off the market and further exacerbating our current affordable housing shortage
We cannot regulate our way out of this crisis. California’s current housing crunch is a matter of simple supply and demand. We must take steps that make it easier to build the affordable and market-rate housing we need to address our current crisis. Prop 10 provides the wrong incentives, and will exacerbate many of the problems proponents say they are trying to solve. Owners of rental property will convert to condos, removing rentals from the market and intensifying shortages.