It's a local regulation so I don't see the connection with a federal election. Maybe it's part of Arnold's program to restore sanity and solvency to California.
A later paragraph says:
The decision is the latest fallout from a funding crisis that surfaced in February and threatened the Housing Authority with being placed in a federal receivership. An agreement between the Department of Housing and Urban Development and the agency gives federal officials greater control over Housing Authority matters and requires local officials to abide by all HUD regulations.HUD may be telling them to shape up or lose their money or all control.