Prominent and Respected CA Leaders Oppose AB 199, Higher Housing Costs

Today, opposition lined up against AB 199 (Kansen Chu, D – San Jose) during the measure’s first policy hearing in the Assembly Committee on Labor and Employment. Joined by more than 100 organizations in opposition to the measure, California Community Builders provided opposition testimony. The California Community Builders is a nonprofit that works to close the wealth gap between low and middle income communities by building low-cost housing for low-income families, and supporting the removal of barriers that exist for minority families to enter the middle-class through homeownership and the associated wealth accumulation opportunity.

“The effect of AB 199 is not modest and the current language will have terrible impacts on the most vulnerable communities in California. It’s way too much for way too many in our communities. It will have a terrible effect on renters – specifically renters of color as some are paying up to 80% of their income on rent. There is an alarming wealth gap that exists in California and the only way to meaningfully close that gap is through wealth accumulation through homeownership. The effects of this bill will deny our communities access to homeownership, and if it denies us access to homeownership, it denies our communities the ability to enter the middle class,” said John C. Gamboa of California Community Builders.

Mr. Gamboa’s testimony noted that opposition statements have been issued by noted Latino civil rights pioneer Herman Gallegos, who helped found the National Council of La Raza; from retired California Supreme Court Justice and civil rights lawyer, the Honorable Cruz Reynoso; and the Honorable Joe Coto, a former member of the California State Assembly who also served as Chair of the California Latino Legislative Caucus. Mr. Gamboa was joined by housing experts in providing opposition testimony where both illustrated how the bill would significantly increase housing costs and the effect the bill would have on the ability low income communities to access affordable housing.

“California’s housing costs are already the highest in the country, and AB 199 will make housing even more expensive. This is a misguided proposal that rewards only a select few and imposes massive new housing costs on everyone else. It puts the American Dream of homeownership even further from realization for all moderate income families, especially for communities of color who are so far behind. California should be doing everything it can to make housing more affordable, not more expensive. In the name of all that is fair and just, I strongly urge you to vote no on AB 199,” read the statement from Mr. Gallegos.

“The bill, unintentionally I believe, will drive up housing costs for every Californian, especially the most vulnerable – families of color, single parents with children and seniors on fixed incomes. It is so discouraging that we could even consider a measure to benefit a small segment of workers to the detriment of all others struggling to make ends meet. There is no doubt in my mind that AB 199 could drive up homelessness and keep poor families poor. In the name of social justice, I urge you to oppose AB 199,” read the statement from Justice Reynoso.

“AB 199 could drive up the cost of housing by 46%. This bill will make it harder for Latino families already struggling to make ends meet. It will force families to choose between paying more for housing or paying for critical needs like food and healthcare. People deserve safe, affordable housing and AB 199 makes it even harder for Latino families and millions of Californians to achieve the American Dream of homeownership. To protect California’s most vulnerable, please vote no on AB 199,” read the statement from the Honorable Joe Coto.

AB 199 would subject much of new residential housing projects in California to be considered a public work project triggering prevailing wage. While the expense of AB 199 will vary regionally, a Beacon Economics study on a ballot measure in Los Angeles that included a prevailing wage mandate estimated that the measure would increase projects’ labor costs by 95.3% and increase the total cost of a project by 45.8%. Building industry experts estimate that AB 199 could add an additional $46-77 per square foot depending on the regional housing market.

AB 199 comes at a time when the housing shortage and subsequent rising housing costs are forcing Californians to live outside of the communities in which they work; pressing more families into inadequate, crowded living conditions; and making many families spend a disproportionate amount of their income on housing. This especially affects communities of color where 59% of African-American renters pay more than 30% of their income toward rent; and 57% of Hispanic renters pay more than 30% of their income towards rent.

About the Coalition for Affordable, Reliable and Equitable Housing

The CARE Housing coalition consists of a broad, diverse group of organizations that strongly oppose AB 199, a measure that could further drive up the cost of housing and exacerbate the current housing shortage crisis. You can learn more about the coalition and obtain a full list of coalition members at its website www.careabouthousing.org.

About California Community Builders

Founded in 2006, California Community Builders is an outgrowth of the Greenlining Institute with its own independent 501(c)(3) non-profit status, board of directors and mission. CCB is a non-profit organization seeking to decrease the home-ownership gap for low-income residents in California beginning with pilot projects in the Central Valley. CCB strives to create positive change at a familial, communal, and regional level through holistic development, home ownership opportunities, and a new high density model for affordable housing development. Specifically, CCB launched The Two Hundred, a project that brings together prolific civil rights leaders to advocate for a state housing program that will reverse the subtle, but insidious actions that have destroyed the homeownership dream for many people of color. The Two Hundred aims to implement a plan that will address the barriers and obstacles that minority families face today to enter the middle-class through homeownership and the associated wealth accumulation opportunity.

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