California Democrats are once again prioritizing housing construction as lawmakers move to revive large bond measures aimed at boosting affordable housing across the state, even as tenant protections struggle to gain traction in the Legislature.
After a historic year for pro-development legislation in 2025, housing advocates are seeking to capitalize on momentum during what is likely Gov. Gavin Newsom’s final year in office. State lawmakers have already begun advancing a $10 billion affordable housing bond that stalled last session, hoping to place the measure before voters as early as the June primary election.
The proposal, Senate Bill 417, cleared the Senate Housing Committee last week by an 8-1 vote and is headed to the Senate Appropriations Committee. Lawmakers face a tight deadline, as the governor must sign the bill by Jan. 22 for it to appear on the June ballot.
“Those homes don’t build themselves, and it’s time to finish the job,” said Sen. Chris Cabaldon, a Napa Democrat who authored the legislation, during a hearing last week. “To unlock the full promise of these reforms requires cash. It requires sufficient capital, as it always has, to move these affordable housing projects from approval and permitting to construct.”
If approved by voters, the bond would direct $7 billion to California’s Multifamily Housing Program, which provides low-interest loans for the construction and preservation of permanent and transitional rental housing for lower-income households. Another $2 billion would support wildfire prevention, rental assistance, and affordable housing for low-income tenants and farmworkers. An additional $1 billion would go toward first-time homebuyer assistance, including down payment support.
Lawmakers also advanced a separate housing bond aimed at helping homeless youth, with discussions underway to combine the measures. Sen. Caroline Menjivar, a Van Nuys Democrat who introduced that proposal, shared her personal experience with housing insecurity.
She said she had “couch surfed” at age 19 after becoming unhoused for a year and a half, adding that early intervention could help prevent long-term homelessness.
“This is an investment that is really going to help us save money down the line,” she said.
Housing advocates say the Legislature’s appetite for large bond measures reflects the growing influence of the pro-housing “abundance” movement, which gained traction last year as lawmakers rolled back environmental reviews for many urban projects and allowed denser housing near transit hubs.
Gov. Newsom has aligned himself closely with those efforts, declaring support for the “Yes In My Back Yard” movement and signing a slate of bills designed to accelerate housing production. In his State of the State address last week, the governor urged lawmakers to focus on lowering construction costs, “utilizing new building methods and technology” and passing “worker-centered reforms that bring our brothers and sisters in labor along with us.”
While housing construction proposals are moving forward, tenant protections suffered a major setback this week.
A controversial rent control bill, Assembly Bill 1157, failed Tuesday in the Assembly Judiciary Committee, marking the second consecutive year the proposal has stalled. The measure, authored by Democratic Assemblymember Ash Kalra of San Jose, sought to tie annual rent increases to inflation and cap hikes at 5% for most rental units, down from the current 10% limit under state law.
“Tenants need a permanent solution, not a temporary fix,” Kalra said during Tuesday’s hearing. “If we don’t act with urgency to help our tenants in crisis, we are going to continue to contribute to the risk of homelessness.”
Despite narrowing the bill to exclude single-family homes in a last-minute compromise, the proposal failed to secure the seven votes needed to advance. Only four Democrats voted in favor, while three Republicans voted against it and five Democrats declined to vote, which effectively counted as opposition.
Following the defeat, Kalra criticized the influence of industry opposition.
“I think that shows the power and influence of moneyed interests,” he said.
Landlord and real estate groups, led by the California Apartments Association, argued that stricter rent caps would discourage investment and harm small property owners. Similar rent control efforts have been rejected by voters in recent years, including Proposition 10 in 2018 and Proposition 33 in 2024.
For tenants like Lidya Morales, a single mother of three in San Diego, the bill’s failure has real consequences. She said her rent rose from $1,300 in 2022 to $2,000 last year, forcing her to work multiple jobs.
“I don’t want to live in my car with my kids,” she said.
Beyond advancing new proposals, lawmakers are also confronting unintended consequences from last year’s aggressive housing reforms, including Senate Bill 79, which allows apartment buildings of up to seven stories near major transit stations.
Critics say the law could displace residents of mobile home parks located near transit corridors. Some estimates suggest more than 5,400 residents could be affected if parks are redeveloped under the new rules.
“This lack of protection threatens existing affordable housing stock that SB 79 seeks to increase,” said Gail Rubino, a resident of a Sunnyvale mobile home park, during testimony last week.
Confusion over how SB 79 should be implemented has also slowed local zoning efforts, with some counties uncertain whether the law applies to them. Sen. Scott Wiener, the bill’s author, has said he plans to introduce follow-up legislation later this year to clarify implementation.
As California lawmakers press ahead with ambitious housing funding plans, the divide between expanding supply and protecting tenants continues to shape what could be another consequential year for the state’s housing policy.
Originally reported byYue Stella Yu in Cal Matters.
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