State Senate Announces Economic Recovery and Housing Stability Plan

Sacramento, California – Senator Anthony J. Portantino (D – La Cañada Flintridge) commends Senate President pro Tempore Toni G. Atkins’s (D - San Diego) on the announcement of the Senate Democratic Caucus’ proposal for the state budget and California’s economic recovery in response to the ongoing COVID-19 crisis. The proposals are the culmination of the continued work of the Senate Democrats’ Working Group on Economic Recovery which has been meeting over the last month. Senator Portantino serves on the Working Group and chairs the Senate Appropriations Committee.

“I am very thankful for the opportunity to participate on this Working Group. The pandemic and its subsequent economic crisis were events that none of us had experienced in our lifetimes. California must be creative and aggressive in our response, aide our economic recovery and bring stability to the rental housing market. These two proposals are a good start,” commented Senator Portantino.

The Senate hopes to balance the state budget over a multi-year period through pragmatic spending decisions, use of reserves and other traditional solutions, and federal support. California has done an exemplary job over the years in building up the Rainy Day Fund in preparation for an economic crisis, allowing California to be in a unique position to successfully respond to this crisis.

The Senate Working Group has proposed two specific additional recommendations to aid California in responding to the economic impacts of the COVID-19 health crisis. The first proposal addresses renter and landlord stabilization. Specifically, the proposal would create a program enabling agreements between renters, landlords, and the state to resolve unpaid rents over a limited time period. The program would allow renters to receive immediate relief for unpaid rent and protection from eviction, and repay past rents, without interest, to the state over a 10-year period, beginning in 2024. Landlords would provide rent relief and commitment not to evict tenants in exchange for tax credits from the state equal to the value of the lost rents, spread equally over tax years 2024 through 2033.

The second proposal would create a $25 billion Economic Recovery Fund through establishment of prepaid future tax vouchers from 2024 through 2033. The funds could be used to create jobs and provide a myriad of services and resources, from small business and worker assistance and retraining to wildfire prevention response and schools most harmed by campus closures.

“The success of our economic recovery is going to be directly tied to how we help our small businesses and our most at-risk Californians. Lower income and middle income Californians have been hit hardest by this crisis. With some of the highest rents in the country, even short-term loss of income has left numerous Californians in desperate need of help. California is dealing with both short-term income loss and record unemployment claims.  These proposals will allow people to stay in their homes and provide much needed business relief,” added Senator Portantino.