California Proposition 14 was a November 1964 initiative ballot measure that amended the California state constitution to nullify the 1963 Rumford Fair Housing Act, thereby allowing property sellers, landlords and their agents to openly discriminate on ethnic grounds when selling or letting accommodations, as they had been permitted to before 1963. The proposition became law after receiving support from 65% of voters. In 1966, the California Supreme Court in a 5–2 split decision declared Proposition 14 unconstitutional under the Equal Protection Clause of the United States Constitution (Fourteenth Amendment). The U.S. Supreme Court affirmed that decision in 1967 in Reitman v. Mulkey.
Political science research has tied white support for Proposition 14 to racial threat theory, which holds that an increase in the racial minority population triggers a fearful and discriminatory response by the dominating racial majority. This was part of a decades-long campaign by real estate interests to undercut the rights of minority groups in regard to housing facilities in California.
California Real Estate Association Race Restriction Committee
In 1942, in response to the success of some Negroes in moving out of the Los Angeles ghetto and into traditionally all white neighborhoods, the California Real Estate Association formed its Race Restriction Committee. The purpose of the committee was to establish perpetual race restrictions on parcels of property. Prior to 1948, the California Real Estate Association routinely promoted and enforced racially restrictive housing covenants to prevent family homes from ending up in the hands of minorities, particularly Negroes.
Support of Federal Constitutional amendment allowing racially restrictive covenants
Shortly following the 1948 court decision in Shelley, an item appeared in the California Real Estate magazine, a publication of the California Real Estate Association (the organization is currently named the California Association of Realtors) advocating an amendment to the United States Constitution that would overturn Shelley and constitutionally guarantee the legal enforcement of racially restrictive covenants throughout the United States.
In advocating support for a federal constitutional amendment guaranteeing the legal enforcement of racially restrictive covenants, the California Real Estate Association publication stated that "millions of home owners of the Caucasian race have constructed or acquired homes in areas restricted against occupancy by Negroes. The practice of surrounding homes in such areas with the security of such restrictions has become a traditional element of value in home ownership throughout this nation."
The publication further stated: "The recent decisions of the Supreme Court abovementioned have destroyed the values thus secured. The threat of occupancy by Negroes of property in such areas depreciates the value of all home properties and constitutes a direct deterrent to investment in the construction or acquisition of homes of superior quality whether large or small. The experience has been uniform that whenever and wherever Negroes have occupied homes in such areas this has not only depreciated values of the properties which they own, but has depreciated the values of all surrounding properties." but the reasons for pursuing such an amendment provided insight into the underlying reasons for pursuing a future and similar protective state constitutional amendment in California.
California Real Estate Association support of 1950 California Proposition 10
The California Real Estate Association also supported California Proposition 10 on the November 1950 election ballot (adding Article 34 to the California Constitution and known as the "Public Housing Project Law") which made it significantly more difficult to build low-rent housing projects in California communities. Proposition 10 had been described as a means of legally handcuffing public housing that may be greatly needed for low-income renters, including minorities.
Blockbusting
Despite the court decision in Shelley, segregation in California continued. As an example, an insidious form of segregation known as blockbusting occurred in East Palo Alto. In 1954, a white resident sold his house to a black family. Almost immediately, agents of the California Real Estate Association, including the president of the statewide real estate Association himself, began warning of a "Negro invasion" and even staged burglaries to panic white homeowners to sell at below-market prices. Those properties were then sold to Negroes at higher-than-market prices with real estate interests handsomely profiting from the transactions. These East Palo Alto houses had been priced so much higher than similar properties for white homeowners that the black homeowners had difficulty making payments which created a slum in East Palo Alto. It was drafted by William Byron Rumford, the first African American from Northern California to serve in the legislature. The Act provided that landlords could not deny people housing because of ethnicity, religion, or national origin (later the law would be extended to apply to sex, marital status, physical handicap, or familial status). Future Governor Ronald Reagan opposed this and other legislative attempts to enact fair housing, but the Rumford Fair Housing Act was signed into law by Governor Pat Brown.
The California Real Estate Association had fought the Rumford Fair Housing Act "every step of the way." In the minds of California Real Estate Association leaders, the Rumford Fair Housing Act directly threatened the financial interests of the real estate industry who came to see "the promotion, preservation, and manipulation of racial segregation as central – rather than incidental or residual – components of their profit generating strategies."
The California Real Estate Association also advised its member boards that speakers from the State Fair Employment Practice Commission, the agency which enforced the Rumford Fair Housing Act, should be prevented from talking to the general real estate membership about the new law. Instead, all questions about the interpretation of the new law would come from the real estate association itself.
Following the assassination of President John Kennedy on November 22, 1963, tremendous pressure was placed on the California Real Estate Association to call off their initiative campaign to repeal the Rumford Fair Housing Act. The association instead decided to "delay a little while" to "let things simmer down." A member of the State Fair Employment Practice Commission, the agency which enforced the Rumford Fair Housing Act, asserted that some members of the California Real Estate Association were promoting their initiative campaign to repeal the Rumford Fair Housing Act to continue blockbusting.
The initiative, numbered Proposition 14 when it was certified for the ballot, was to add an amendment (Cal. Const. art. I, § 26) to the constitution of California. This amendment would provide, in part, as follows: