An assemblyman has introduced legislation aimed at preventing the state's two big public pension funds from investing in so-called "predatory" schemes that displace rent-control tenants.
The bill is AB 2337 by Assemblyman Tom Ammiano, D-San Francisco. It's in response to a couple of controversial investments, one in New York and one in East Palo Alto, that were predicated on converting thousands of rent-controlled apartments and houses into market-rate units by moving new tenants in.
CalPERS invested a total of $600 million in the two deals, CalSTRS put $100 million into the New York deal.
Both deals went bust when the market soured, but not before generating lots of controversy and litigation over how rent-control tenants were being treated. Tenants rights advocates say the landlords harrassed longstanding tenants to get them to leave.
Generally speaking, a rent-control unit can be decontrolled when a new tenant moves in.
The investments were the subject of a lengthy piece in The Bee last November.
A CalSTRS spokesman, Ricardo Duran, said the teachers' fund's legislative committee hasn't yet reviewed the legislation. A spokesman for CalPERS, Brad Pacheco, said the fund will study the bill.
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