Governor Newsom Signs Bill Closing Redlining Loophole

For immediate release:
Assemblymember Bloom poses with Governor Newsom a several of his colleagues in both the Senate and Assembly as they celebrate the signing of 27 housing bills.

SACRAMENTO – Today, Governor Newsom signed AB 721 into law. Authored by Assemblymember Richard Bloom (D – Santa Monica), AB 721 will remove vestiges of racist redlining and segregation in the form of covenants prohibiting multi family housing – even where local zoning allows it. These covenants  have hindered affordable and supportive housing development throughout the State. “Just as racial restrictions in housing covenants go against our values as Californians, the same is true about density restrictions that aim to keep low-income and communities of color out of certain neighborhoods,” said Assemblymember Bloom.

Decades ago, court decisions and the California Legislature made racially restrictive covenants unenforceable from a legal perspective. However, the racial restrictions are often contained in longer covenant documents with restrictions on the size and number of units allowed on a parcel, which can act as barriers to the development of affordable and supportive housing. The time and expense needed to remove these covenants deter developers from acquiring and developing on these otherwise ideal project sites. This, in turn, diminishes the production of multi-family housing.

AB 721 will clarify that density restrictions in private covenants cannot be used to curtail affordable and supportive housing. The measure allows for the owner of a property who commits to building 100% affordable units for lower income household may build as many units as the local zoning code allows. AB 721 also preserves and strengthens local control by invalidating density restrictions in housing covenants that do not conform with local zoning laws.

“For decades, private and discriminatory covenants have led affordable housing developers to walk away from ideal sites for properties,” said Tara Barauskas, Executive Director of nonprofit affordable housing developer Community Corporation of Santa Monica. "We appreciate the leadership of Assemblymember Richard Bloom’s office on instrumental legislation that helps pave the way for developers to create more equitable housing opportunities throughout California.

 “As California struggles with an unprecedented homelessness and housing crisis, we have an obligation to ensure these restrictions don’t continue to stand in the way of affordable housing production,” added Bloom.

Supported by groups such as the Community Corporation of Santa Monica, Public Counsel, and Abundant Housing LA, AB 721 will take effect on January 1, 2022.