The Rent Control Board will continue to tackle tax surcharges on tenants who have seen their rental rates surge when they consider whether to create a subcommittee on the issue Thursday. The RCB aims to help current tenants who’ve surcharges increase because of property tax assessments during Santa Monica’s current real estate market boom.
Last month, the RCB eliminated the issue for new tenants and future sales when they put a sunset on the law that allowed the pass-throughs to happen. A new property owner will no longer be able to pass any of the massive property tax increase down to tenants when they purchase a multi-unit building in Santa Monica. Because the decision is not retroactive, tenants currently paying surcharges will continue to do so unless they move out or the building is sold to a new owner.
There are current surcharges linked to Measures X, S, BB and AA. Landlords could also pass along a stormwater management user fee, the clean beaches and ocean parcel tax and a 2008 school district special tax. The median monthly surcharge is $20.73, however, some tenants have seen their bills skyrocket in recent years.
The RCB will decide whether to create a subcommittee to address tax-related surcharges when they meet Thursday night. The subcommittee of just two members would investigate and make recommendations on how to address the surcharges. Tenants have testified at public meetings they are in danger of eviction because they cannot afford the surcharges.
General Counsel J. Stephen Lewis is recommending the board form a subcommittee to meet with stakeholders.
“When discussing the issue in broad terms at its last meeting, there was clear unanimity on two points: that is must be approached delicately in order to avoid unintended consequences, and that – probably because of the delicate touch that the issue calls for – arriving at the right approach is likely to be time consuming,” Lewis wrote in a memo to the board.
Board regulations stipulate the subcommittee should represent, as far as possible, all points of view in the organization. The subcommittee would likely cost taxpayers very little because they would meet and conduct work largely on their own with occasional staff support.
Lewis said the RCB may not have the authority to appoint an advisory committee including members who are not already on the RCB.
“The Charter says that the Board may conduct studies, surveys, and investigations; it doesn’t say that the Board may create a new entity to do those things,” Lewis said.
The Rent Control Board meets Thursday, Feb. 22, 2018 at 7 p.m. in City Council Chamber, City Hall, 1685 Main Street.