20250AB__268995AMD INTRODUCED 2026-02-20 AMENDED_ASSEMBLY 2026-03-19 AMENDED_ASSEMBLY 2026-04-06 AMENDED_ASSEMBLY 2026-04-30 AMENDED_SENATE 2026-06-22 2025 AB AMD Introduced by Assembly Member Ávila Farías (Coauthor: Senator Caballero) LEAD_AUTHOR ASSEMBLY Ávila Farías COAUTHOR SENATE Caballero

An act to add

Section 50199.28 to the Health and Safety Code, relating to housing. housing Low-income housing tax credits: lease nonrenewal: good cause. Existing law, in modified conformity with federal income tax laws, establishes a low-income housing tax credit program through which the California Tax Credit Allocation Committee allocates low-income housing tax credits aimed at providing affordable low-income housing within and throughout the state.

Existing federal law sets limitations and guidelines regarding what projects are eligible for credits, including a requirement that an extended low-income housing commitment is in effect, and a prohibition against eviction except for good cause.

This bill would specify, for housing projects where the low-income housing commitment requires 100% of the units, not including any manager’s units, to be restricted to lower income households, as defined, that good cause for nonrenewal of a lease includes cases where the nonrenewal relates to a household whose income exceeds 140% of the area median income for at least consecutive years and 30% of the household’s monthly income exceeds the fair market rent, determined as specified.

The bill would require an owner to provide notice of the potential of good cause for nonrenewal described above if the household’s income exceeds 140% of the area median income during any income certification, as specified. The bill would also require an owner electing to not renew a lease as described above to issue a notice of nonrenewal describing the basis of good cause for nonrenewal at least days prior to the expiration of the lease, as specified. MAJORITY NO NO NO NO NO NO NO NO NO NO The people of the State of California do enact as follows:

SECTION

Section 50199.28 is added to the Health and Safety Code , to read: 50199.28. (

a) For purposes of implementing

Section 42(h)(6) of the Internal Revenue Code, for any qualified low-income building where percent of the units, except for any manager’s unit, are restricted to lower income households, as defined in

Section 50093, by an enforceable regulatory agreement with a government entity, good cause for nonrenewal of a lease shall include cases where both of the following apply:

(1) The household’s income exceeds percent of the area median income for at least two consecutive years.

(2) Thirty percent of the household’s monthly income exceeds the greater of the following: (

A) The United States Department of Housing and Urban Development’s Fair Market Rent for an equivalent-sized unit for the county where the unit is located, as updated annually. (

B) The United States Department of Housing and Urban Development’s Small Area Fair Market Rent for an equivalent-sized unit for the ZIP Code where the unit is located, as updated annually. (

b) If, during any income certification, the household’s income exceeds percent of the area median income, the owner shall provide the household with written notice of the household’s income threshold exceedance within days of the certification. The notice shall include a statement that the household’s income exceeds percent of the area median income and that if the household’s income exceeds percent of the area median income for two consecutive years, and if percent of the household’s monthly income exceeds the applicable fair market rent provided by paragraph (2) of subdivision (a), the owner may have good cause for nonrenewal of the lease pursuant to this section. (

c) If paragraphs (1) and (2) of subdivision (

a) are satisfied and the owner elects to not renew the lease pursuant to this section, the owner shall issue a notice of nonrenewal at least days prior to the expiration of the lease term and include a citation to this

section as the basis for nonrenewal and a statement that the nonrenewal is for good cause because the household’s income has exceeded percent of the area median income for two consecutive years and percent of the household’s monthly income exceeds the applicable fair market rent provided by paragraph (2) of subdivision (a).