New Kamala Harris Bill Asks Federal Taxpayers to Subsidize California’s High Housing Costs

Rents in California have skyrocketed over the past decade, thanks to the innumerable restrictions, taxes, and fees that the state imposes on new housing development. Now Sen. Kamala Harris (D-Calif.) wants the rest of the country to pay to fix this problem.

On Thursday, Harris, along with Sens. Richard Blumenthal (D-Conn.), Maggie Hasan (D–N.H.), and Diane Feinstein (D-Calif.), introduced the Rent Relief Act, which would provide refundable tax credits for tenants who spend more than 30 percent of their income on rent.

While doing little to address the root of the housing crunch—namely restrictions on supply—Harris’ bill is undoubtably good politics in a state where 58 percent of renters pay more than a third of their income in rent. The bill has gotten glowing reviews from local politicians who are only too happy to deflect any blame they might share for the Golden State’s housing woes.

Both the fairness and the economics of the proposal leave a lot to be desired, says Lynn Fisher, a housing policy expert with the American Enterprise Institute.

“We would be asking the whole United States to subsidize the bad behavior of some locales that are artificially pushing up rents by not allowing more building to happen,” says Fisher.

In contrast to the rhetoric about helping hard-pressed renters, Fisher notes, Harris’ plan would shower benefits on a staggering number of tenants, including relatively high-income ones. The Rent Relief Act would give tax credits for people earning as much as $100,000 a year and renting out apartments that cost up to 150 percent of an area’s median fair market rent.


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