New Regulations

“The new regulations also state that merely having a certificate of having an animal wear a vest is not in and of itself sufficient.”

Finally, the federal and state governments agree on something and that something benefits the rental housing industry!

The federal Department of Housing and Urban Development (HUD) and the California Department of Fair Employment and Housing (DFEH) agree that online certifications from websites which claim to represent that they can help a tenant’s or applicant’s disability-related need for an assistance animal (many times referred to as an emotional support animal) are presumptively unreliable unless they include an INDIVIDUALIZED ASSESSMENT (emphasis added). Even though the two governmental agencies were generally in agreement, HUD’s position is far more hostile to businesses engaged in offering to sell online certifications.

Not long ago HUD asked the Federal Trade Commission (FTC) to investigate websites claiming to offer assistance animal documentation for misleading consumers, including property owners, managers, tenants and applicants.

According to HUD, these websites offer documentation that is not reliable for the purposes of determining whether an individual has a disability or disability-related requirement that needs an assistance animal. All of this is due to website operators and health care professionals who consult with them lack knowledge that is required to opine that a tenant or applicant needs an assistance animal.

HUD pointed out in its position on this issue that healthcare professionals may provide remote services which may include over the internet reliable verification “if the provider has personal knowledge of the individual’s disability-related need for an animal.” HUD stated that “personal knowledge” is of the type that health care professionals ordinarily use for diagnostic and treatment purposes.

Effective January 1, 2020, the DFEH new regulations address the type of documentation that will be sufficient as evidence of a disability-related need for an assistance animal. The new regulations state that a support animal certification from an online service that does not include an individualized assessment from a medical profession is “pre sumptively unreliable.”

The new regulations also state that merely having a certificate of having an animal wear a vest is not in and of itself sufficient. Note, however, that property owners and managers that are provided with these types of “unreliable online certification” cannot outright deny the accommodation. Property owners and managers are instead to request addition information in order to make a determination for a reasonable accommodation.

There is good news to report as well regarding a bill that sought to provide convicted felons with a second chance to secure rental housing with the general population of existing tenants. The bill would have created a new class of protected individuals that are not recognized as a protected class by any other civil rights legislation, either in state of federal law. Members of that class, unlike the members of all of the other recognized protected classes, are not in the class because of immutable characteristics or conditions over which they have no control. To the contrary, the members of this new class that was to be created would become members of this new class solely because of actions they have voluntarily and intentionally taken against the interests of others. We argued that safety and security of tenants is always of paramount importance to property owners and tenants. The primary duty and desire of rental property owners is to ensure their tenants’ safety and security. Interestingly, a recent report the state Department of Corrections and Rehabilitation found that the three-year recidivism rate of those either arrested or convicted of crimes was 65 percent! Other relevant findings in that report included: inmates committed to prison for property crimes consistently recidivate at a higher rate (69 percent) than those committed for other crimes; and most felons (73 percent) who recidivate return to prison within a year of release. And to add to the issue we also argued that the bill, AB 53, would have provided greater benefits to this new class that are provided for any other protected group.

her a worker is an independent contractor—as Uber, Lyft and other similar companies designate their rank and file workers—or an employee. The latter are protected by minimum wage rules and entitled to overtime pay and other benefits, the former are not.

The court set forth the so-called ABC test. Workers are employees unless they’re (A) independent of the hiring entity’s control and direction about how they perform their work; (B) engaged in work different from the hiring entity’s business; and (C) conducting an independent business in the same field as the work they’re doing for the hiring entity. In other words, a plumber hired by a property owner to fix a leaky bathroom is an independent contractor. A driver picking up passengers for Uber: employee.

Should Uber and Lyft decide to comply with the new law, the costs to reclassify the drivers as employees will drive up costs and force them to rewrite their business models. And the drivers are divided on this issue. Some strongly prefer to be classified as employees and others feel that AB 5 will deprive them of a part they value deeply: flexibility to set their own schedules.

Legal experts state that nothing prevents the state from defining “employee” for the purpose of wage and hour law. What AB 5 can’t do is to guarantee drivers the right of collective bargaining. This is because the National Labor Relations Board, through its general counsel’s office, has ruled that Uber drivers are independent contractors and therefore ineligible to unionize.

Don’t think that the residential rental community is exempt from the term of AB 5. The requirements are something that each of us needs to evaluate and determine its application to our business lives.

Another bill that caught national attention was SB 206—the so-called Fair Pay to Play Act. The bill that gives student-athletes at California colleges and universities the right to be paid for the use of their “name, image, or likeness.” The NCAA has threatened to bar our universities from NCAA championships. The Legislature saw this threat to keep such athletic mainstays as USC, UCLA and Stanford out of its championships as empty blustering and passed the bill without a single opposing vote.

Cities and counties will be prohibited, according to the terms of SB 330, where housing is allowed, from enacting a development policy, standard or condition that would:

  • Change the general plan use designation or zoning of a parcel to a less intensive use or reduce the intensity of the land use within the general plan below what was allowed that was in effect on January 1, 2018;
  • Impose a moratorium or similar restriction on housing development;
  • Limit the number of land use approvals or permits necessary for the construction of housing;
  • Cap the number of housing units that can be approved; and
  • Limit the population of the city or county.

In addition, SB 330 provides that:

  • No local government would be able to hold more than five public hearings in connection with the approval of a proposed housing development.
  • The state Department of Housing and Community Development is to adopt a standardized form that applicants for housing development projects may use.
  • The amount of time a local government may use to approve or disapprove an application was sharply reduced.

A few bills were put off until this year. Two bills are aimed at reducing the use of plastics and therefore resulting in less pollution, in part by mandating that single-use utensils be recyclable or compostable. Another would require the Department of Corrections to house prisoners according to their gender identity, not their gender birth.

Certainly, it can be argued that there are other housing bills that will have a meaningful impact—and those bills would have never been successful just a few years ago.

And this year… what can we expect affecting the rental housing industry? Just about everything!

There will be clean-up legislation to AB 1482. Some of those changes will be technical in nature such as fixing issues relating to how the consumer price index is calculated and others will certainly be quite substantive such as seeking to prohibit state subventions and program money to local governments that are not meeting their regional housing needs numbers.

Stay tuned for another statewide ballot fight on rent control. Michael Weinstein is proposing another draconian statewide rent control measure.

There will be another attempt to make it extremely difficult to refuse to rent to a felon.

And to cap it off… a proposed bill should be introduced that will require that any time a rental property owner is to sell, that a qualified non-profit entity be given the first right of refusal to purchase that property.

Our guess is that if you have read this article this far, we have caught your attention!


Ron Kingston is President of California Strategic Advisors. Jack Schwartz is an attorney based in San Francisco.