Senate approves increased tax credit for renters after overwhelming bipartisan vote

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SACRAMENTO – California’s poorest tenants and single parents would get a big boost to help pay their rent under legislation overwhelmingly approved in the state Senate on Tuesday.

The bill, SB 843, passed 37-0 and sent to the Assembly, would increase California’s tenant tax credit for the first time in more than 40 years. Individuals would receive $500 and single parents and couples would receive $1,000. For the first time, low-income renters would be eligible for the full credit regardless of their tax liability.

Senators Steve Glazer, D-Contra Costa, and co-authors Maria Elena Durazo, D-Los Angeles, and Sidney Kamlager, D-Los Angeles, were joined by a coalition of more than 50 co-authors of this draft law.

“This bill will provide direct relief to millions of tenants who struggle to pay their rent each month,” said Senator Glazer. “For too long renters have been left behind as we try to make California an inclusive home of economic opportunity. It’s time to open the door to them all. SB 843 would do just that by increasing the tenant’s tax credit for the first time in 42 years.

In Senator Durazo’s district, 77% of her voters are renters; 66% of Senator Kamlager’s voters are tenants.

“My district has more tenants than anywhere in the state, and we know they are hurting right now,” Sen. Durazo said. “Rents are higher than ever, the cost of food on the table is rising and so many people are struggling to make ends meet. This tenant tax credit will help those who are struggling the most and put money back in the pockets of millions of working Californians.

The tenant credit has not seen an increase since 1979. The proposed increase takes account of inflation since then. SB 843 provides direct assistance to tenants – those who typically have the hardest time finding affordable housing and who have been hit hard during COVID-19.

“California’s cost of living is high, especially for those who are struggling financially and need our help,” Senator Kamlager said. “As a co-author of SB 842, I am proud to see the Senate vote to make our rental credit reflect today’s financial reality. Economic justice demands it.

While California homeowners are getting $4 billion in tax relief through mortgage deductions and $1.5 billion through property tax deductions, tenant relief has been just one flash on the radar. The tenant currently receives $160 million in tax credits, according to current Franchise Tax Board estimates.

This bill would index the credit in perpetuity to account for inflation as calculated by the Franchise Tax Board. Under the legislation, the governor could suspend the increase in the event of an economic emergency.

The tenant credit was introduced in 1972. Since its only increase in 1979, rents in California have almost tripled. The state’s median rent exceeds $1,500 per month for a two-bedroom apartment, and rentals in cities like San Francisco average over $2,700 per month.

Main co-authors:

Assembly Members Isaac Bryan, D-Los Angeles, Steven Choi, R-Irvine and Mike Gipson, D-Carson.
Co-authors:

Senators Ben Allen, D-Santa Monica; Bob Archuleta, D-Pico Rivera, Patricia Bates, R-Laguna Niguel; Josh Becker, D-San Mateo; Anna Caballero, D-Salinas; David Cortese, D-San Jose, Brian Dahle, R-Bieber; Bill Dodd, D-Napa; Lena Gonzalez, D-Long Beach; Shannon Grove, R-Bakersfield; Robert Hertzberg, D-Van Nuys; Ben Hueso, D-San Diego, Melissa Hurtado, D-Sanger, Brian Jones, R-Santee, John Laird, D-Santa Cruz, Connie Leyva, D-Chino; Monique Limon, D-Santa Barbara; Melissa Melendez, R-Lake Elsinore; David Min, D-Irvine, Josh Newman, D-Fullerton; Jim Nielsen, R-Red Bluff; Rosilicia Ochoa Bogh, R-Yucaipa; Anthony Portantino, D-La Canada Flintridge; Richard Roth, D-Riverside; Susan Rubio, D-Baldwin Park, Henry Stern, D-Malibu; Tom Umberg, D-Santa Ana; Bob Wieckowski, D-Fremont; Scott Wiener, D-San Francisco and Republican Leader Scott Wilk, R-Santa Clarita.

Assembly Members Cecilia Aguiar-Curry, D-Winters; Rebecca Bauer-Kahan, D-Orinda; Marc Berman, D-Palo Alto; Tasha Boerner Horvath, D-Encinatas; Tom Daly, D-Anaheim; Laurie Davies, R-Laguna Niguel, Laura Friedman, D-Burbank; Jesse Gabriel, D-San Fernando Valley; James Gallagher, R-Chico; Adam Gray, D-Merced; Tom Lackey, R-Palmdale; Alex Lee, D-San Jose; Marc Levine, D-Greenbrae; Kevin Mullin, D-San Mateo, Adrin Nazarian, D-Sherman Oaks; Janet Nguyen, R-Garden Grove; Cottie Petrie-Norris D-Irvine; Robert Rivas, D-North Hollywood; Miguel Santiago, D-Los Angeles; Kelly Seyarto, R-Murrieta; and Thurston Smith, R-Hesperia.

Photo posted on Senator Steve Glazer’s Twitter page

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