California Bill Would Keep the AIDS Healthcare Foundation Out of the State's Housing Battles

Is it constitutional?


Just as a California rent control ballot initiative gains steam, a bill in the state legislature would effectively prohibit the initiative's chief financial backer from participating in housing politics. It's anyone's guess whether the legislation is constitutional.

Working its way through the California Assembly right now is A.B. 1938, a bill that would prevent a very narrowly defined set of health care organizations from spending money they receive from contracts with state and federal health agencies or from federal discount drug programs on influencing housing-related ballot initiatives. The legislation also blocks them from spending the money on certain types of environmental lawsuits often used to hold up housing projects.

The type of organization affected by the bill is defined so narrowly that it applies to only one outfit: the polarizing AIDS Healthcare Foundation (AHF).

"There have been documented cases where public money was used in an attempt to affect public policy unrelated to the health arena, and instead used to affect the production of new housing in California," reads a summary of the bill released by its sponsor, Evan Low (D–Campbell), which calls out AHF by name. "A.B. 1938 ensures that public resources are spent wisely and for the purposes for which they are intended."

An Assembly Committee on Health analysis of the bill is explicit about it solely targeting AHF.

By day, the Los Angeles–based AHF contracts with the state's Department of Health Care Services (DHCS) and the federal Centers for Medicare and Medicaid to provide health care plans to HIV-positive patients.

It also runs a network of pharmacies that make much of their money by participating in the federal 340B Drug Pricing program. That program requires drug companies to sell certain drugs at discount rates to hospitals and other nonprofits, such as AHF, which then bill private and public health insurance plans for the full price of the drug.

In addition to these functions, the group and its controversial founder Michael Weinstein have devoted some its $1.4 billion-a-year budget to pushing an eclectic set of political causes, including condom mandates for porn stars and capping the costs of prescription drugs.

More recently, AHF has made itself a major player in California housing politics, combining NIMBY (not in my backyard) opposition to new development with strident support for rent control. The group spent some $22 million advocating for 2018's Proposition 10, a failed ballot initiative that would have repealed the state's restrictions on local rent control measures. It's trying again this year with the similar Rent Affordability Act, which will be on the November ballot. AHF has contributed $4.7 million to the Yes campaign so far.

The group is also known to file lawsuits to prevent the development of new housing. And it has been a full-throated opponent of various bills by state Sen. Scott Wiener (D–San Francisco) to legalize the development of mid-rise apartment buildings near transit stops and job centers. Last year it sparked controversy with mailers comparing one of Wiener's bills to the urban renewal policies of the mid-20th century. The mailer featured a quote from civil rights era activist James Baldwin calling urban renewal "Negro removal."

Needless to say, this activism has made AHF a lot of enemies in the contentious world of California housing politics. Hence A.B. 1938. Wiener is listed as a principal co-author on the legislation, which also has the support of the California Apartment Association, a landlord trade group.

"This is perhaps one of the most undemocratic bills that a Democrat could carry. This bill is trying to silence an organization that is trying to speak on behalf of renters and the disenfranchised," says Ged Kenslea, communications director for AHF. "This is a total David and Goliath situation that legislators are carrying water for Wall Street landlords that are eager as all hell to evict tenants."

Kenslea also says A.B. 1938 is unconstitutional. "This legislation would not pass the constitutional test when it comes to infringing on First Amendment rights," he says.

Eugene Volokh, a law professor at UCLA who also blogs at The Volokh Conspiracy (hosted here at, isn't so sure on that last point.

A.B. 1938 "does raise First Amendment concerns, but it's not clear how they are to be resolved," he tells Reason, saying the Supreme Court has yet to definitively rule on this issue.

"The argument in favor of constitutionality is this is government money and the government can attach strings to it," says Volokh, saying that courts have generally upheld the ability of the government to restrict or condition how the recipients of government subsidies spend those dollars. They have said, for example, that when the government provides subsidies to doctors to educate patients about contraception, it can restrict them from discussing abortion.

In the context of A.B. 1938, a court could treat the money the organization receives from DHCS as a subsidy that must be used on health care, in which case it would be within the state legislature's power to say it can't be spent on housing ballot initiatives.

On the other hand, Volokh says, a court could also reason that this money isn't so much a subsidy as compensation paid to AHF for providing health care. In that case, the government couldn't regulate how that money is spent.

"It's one thing when the government gives people a subsidy but it's another thing when it pays for services rendered," Volokh explains. He adds that a law restricting AHF's speech on housing issues only could prompt a court to strike it down for viewpoint discrimination.

Volokh thinks the bill is most vulnerable to a constitutional challenge when it tries to restrict how AHF uses dollars it receives from federal programs. California couldn't claim to be the entity providing the subsidy, and therefore it would have no authority to attach strings to that money. The legislation does, however, instruct the DHCS director to get all necessary federal approvals when implementing the bill.

A.B. 1938 passed out of the Assembly's Committee on Health Care in mid-May and has been referred to the Appropriations Committee. It faces a June deadline for passing out of the Assembly. Kenslea says that even if the bill passed, it wouldn't go into effect until 2021, meaning it would have no effect on the current rent control ballot initiative.

There is pretty much zero overlap between any of AHF's positions on housing and those of free marketers. The group has opposed lifting existing restrictions on development, advocated imposing new ones, and has spent millions of dollars pushing rent control.

That said, A.B. 1938's efforts to prohibit the group from participating in the political process seems dirty, especially given the possible unconstitutionality of the bill.

The folks who favor upzoning and oppose rent control have a compelling case to make. They should focus on selling their vision to the public, not squelching the speech of their opponents.

NEXT: The Vast of Night Is the First Must-Watch Movie of the Coronavirus Era

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  1. HIV / AIDS is a terrible but preventable disease. If the federal government can fine its citizens for NOT purchasing health care insurance, why can’t the government fine its citizens for NOT purchasing condoms?

    1. If they’re democrats they fine you for not wearing masks. So I could see lefties supporting requiring condoms at all times.

      1. So I could see lefties supporting requiring condoms at all times.

        Not SJW-y enough. Requiring homos to wear condoms is racist. Hetero-sex without a condom is rape. Condoms available by prescription only.

        1. Condoms available by prescription only.

          Paid for by employers and religious institutions of course.

        2. I Make Money At H0me.Let’s start work offered by Google!!Yes,this is definitely the most financially rewarding Job I’ve had . Last Monday I bought a great Lotus Elan after I been earning $9534 this-last/5 weeks and-a little over, $10k last month .cxs . I started this four months/ago and immediately started to bring home minimum $97 per/hr

          Heres what I do……………… See More here

  2. It’s anyone’s guess whether the legislation is constitutional.

    If it’s that unclear, anyone would say the legislation is bad on the face of it.

    Am I doing this right?

    1. I am making a good MONEY (500$ to 700$ / hr )online on my Ipad .Last month my pay check of nearly 30 k$.This online work is like draw straight-arrow and earn money. Do not go to office.OCx I do not claim to be others,I just work. You will call yourself after doing this JOB,It’s a REAL job.Will be very lucky to refer to this WEBSITE.

      I hope,you can find something………..► ScolloconGress

  3. How is this violating anyone’s 1A rights? You don’t have a right to government money, they can give it to you with strings attached. I can see that they’d be allowed to spend money they already got on whatever the fuck they’d like, but going forward the government can say “you gotta pat your head and rub your belly at the same time if you want this check” and there’s nothing wrong with that. The State may have to wait for current contracts to expire, at that point they can put whatever terms they’d like in there and AHF is free to fuck off if they don’t like the terms.

    “That said, A.B. 1938’s efforts to prohibit the group from participating in the political process seems dirty”

    No one is being prevented from participating in the political process. AHF is free to keep lobbying on housing issues and suing people about it, they just have to come up with the funds themselves.

    1. How is this violating anyone’s 1A rights?

      California’s State Assembly shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances or threatening the supply of free shit checks from the government to private advocacy groups.

      It’s right there you authoritarian fuck!

      Sure, they may depend on the government for special protections and maybe even some cash but that doesn’t mean they shouldn’t get the same 1A protections that your average bakery, pizzeria, or jeweler gets. Maybe more considering how much more critical they are to free and equal democratic process!

      1. Julia S. Robert making a good MONEY (500$ to 700$ / hr )online on my Ipad .Last month my pay check of nearly 30 k$.This online work is like draw straight-arrow and earn money. Do not go to office.I do not claim to be others,I just work. You will call yourself after doing this JOB,It’s a REAL job.Will be very lucky to refer to this WEBSITE.I hope,you can find something…. Articles About

  4. If it’s that unclear, anyone would say the legislation is bad on the face of it.
    UP BhuNaksha
    Am I doing this right?

    Herpes simplex virus is said to have no cure, just as i was told by my family doctor that herpes can not be cured but can be controlled, Although i was a very stubborn person i never believed in what my doctor told me about herpes having no cure Am a very honest person who believe in nature and i also believed that there could be cure somewhere in the world, I kept my faith so strong and kept on doing my research till i finally came across Dr. Joe Blessed from west Africa He is one of the oldest herbalist after Dr. Sebi and total am a living testimony to his herbal cure to herpes, i became herpes Negative on the 17/05 2018 after using the herbal medication DR. JOE BLESSED mailed to me along with the prescriptions and today its been 2 years and herpes is not traceable in my body system, All thanks To Dr. Joe BLESSED For More Info on how to get cured Contact DR . JOE now on EMAIL : (dr.joeblessed @ gmail. com) Or CALL/WHATS APP (+234 9034258471 ) or mail me directly on dorislukaz21 @ gmail. com

  6. I wonder if that with the set of criteria so narrow and a legislative history that clearly marks the bill as attacking this organization, would it be unconstitutional as a bill of attainder?

  7. This is a major problem when businesses or organizations influence policies. This is the systematic change that NEEDS changing too.

  8. I was in trouble when my doctor told me that i have been diagnosed with
    HIV DISEASE and i know my family will face a serious problem when i am gone, i
    lost hope and wept most of the time, one peaceful day i look at the internet and
    i saw Dr. Smith testimonies and i followed him up in a GOOD WAY. I called him and he
    guided me through out everything. i asked him for solutions and he started the remedy for my
    health, thank God, now everything is fine and i am cured of my HIV by Dr Smith herbal
    medicine, am very thankful to Dr.Smith, contact him today and be free from your Diseases / Virus / Infection // because he is very good and honest Doctor. contact him via email; mobile whats-app +2348102652355….One thing i love most about Dr. Smith is honestly and he is very polite with his patience, so everything he told me was what he did, and his herbal medicine are very affordable to get, Dr Smith God will over bless you.
    He can as well cure the following diseases;

    HSV1, &
    Hepatitis B,

Please to post comments

Comments are closed.