This column has on occasion analogized the legislative process with features of our daily lives. This time the analogy is between the legislative process, which can seem mysterious to the uninitiated, to commercial fireworks displays. Follow us on this: just as fireworks start slowly and build towards predictable finales, two-year sessions of the legislature begin very slowly with the swearing-in of legislators on the first Monday of December following general elections in even-numbered years, and progress to absolute frenetic chaos as the end of session approaches. This year, the 2025-2026 two-year session must conclude under the California Constitution at midnight, August 31, 2026.
When the session concludes, the Governor will have 30 days in September to sign or veto the many hundreds of bills sent to his desk. Then, the slate is wiped entirely clean for the next session; nothing carries over from 2026 to 2027. This time, with a new Governor on (his) way, and at least a couple of dozen new legislators expected to take office in December, legislators know that the final time before adjournment is “do or die” for their bills.
UTA has major “irons in the fire” as the end of session approaches. By far the most consequential is AB 1957 (Pacheco), which is designed to reform severely flawed provisions in SB 1079, enacted during the pandemic. As every UTA member knows, SB 1079 was a well-intentioned effort to give prospective owner-occupants, tenants, land trusts and nonprofits the opportunity to bid on foreclosed properties, with post-sale overbids.
What the author of SB 1079 did not envision, though, was the degree to which the law would depress bidding at sales and lead to outright fraud by investors posing as prospective owner-occupants, hiding behind straw-buyer tenants, and even creating sham nonprofits. Even the community housing providers admit the existence of the fraud problem, which was recently documented in an article from the San Diego Union-Tribune. At the same time, the community groups vehemently opposed “throwing the baby out with the bathwater” by repealing the entire law.
UTA-sponsored AB 1957 makes major changes in terms of reducing the categories of SB 1079 bidders, and reducing the properties subject to the process. With only weeks remaining in the session, the new bill has passed the Assembly virtually unanimously, and is pending hearing in the Senate. Negotiations continue with the community groups, and with the California Association of Realtors, both of which are opposed to the current version of the bill, while at the same time conceding that the problem is real. UTA leaders Ed Treder, Michelle Mierzwa and Andrew Boylan have been indispensable in the discussions.
Forbearance is another issue pending in the final weeks, with two bills remaining alive, both by the same legislator, Assembly Member John Harabedian (D-Pasadena). The first is AB 1842, which quite sensibly proposes a sort of “template” which would regulate forbearance when future declared disasters occur. After all, the Palisades and Altadena fires will hardly be the last disasters befalling California, and it should not be necessary to recreate forbearance laws each time a new disaster is declared. But, as they say, “the devil is in the details”.
The second bill, AB 1847, is more controversial than the first, because it proposes to extend the current forbearance law, enacted in AB 238 last year, from one year to three, for specific ZIP codes in the Los Angeles and Ventura County wildfires. Clearly homes in the Palisades and Altadena are not being rebuilt as quickly as anyone hoped, and AB 1947 does not propose an absolute requirement for granting forbearances, when GSE and private guidelines do not permit them. But should California enact a law telling borrowers that they may be eligible for a streamlined process to obtain three-year forbearances, when in most cases investor guidelines require case-by-case decisions?
During the time remaining in the legislative session, the Assembly and Senate will grapple with mega-issues affecting essentially every Californian. Limits on artificial intelligence and social media, particularly relating to children, are examples. But thousands of more specific interest groups, UTA included, have major stakes in the outcome.
The finale approaches…