The Senate’s solution to this is to give landlords
tax credits equal to the value of their missed
payments. Landlords could keep the credits,
which would lower their state tax bills from 2024
through 2033, or they could sell them for cash.
Tenants would have 10 years to pay back their
missed rents to the state, with some not having
to pay the full amount because of an unspecified
hardship exemption. The state would not
charge interest.
The program would be voluntary, meaning both
tenants and landlords must agree to it. If no
tenants paid the money back, lawmakers estimate
it would cost the state about $500 million.
“This is not a giveaway to anyone,” Democratic
Sen. Steven Bradford said. “Our goal is to
keep tenants housed and keep landlords
out of foreclosure.”
California Apartment Association CEO Tom
Bannon called the proposal a “creative effort,”
but said he wants “to refine” the plan. He did not
give details.
The proposal is the first significant coronavirus
relief package from the state Senate, which
returned to work this week after taking its first
unscheduled work stoppage in 158 years. The
virus has upended the legislative session, with
lawmakers searching for ways to aid the state’s
economic recovery while facing an estimated
$54.3 billion budget deficit of their own.
This week offered the first draft of what a state
aid package might look like. Senate leaders
endorsed a $25 billion economic recovery fund
that small businesses, nonprofits and local
governments could tap to help weather the
virus-induced downturn.