Santa Monica’s gonzo Action Apartment Association is up to its old tricks. They’ve filed another lawsuit in Santa Monica Superior Court challenging Santa Monica’s 31-year-old rent control laws. And, yes Virginia, it’s an election year.
Action’s latest complaint contends that apartment owners haven’t been allowed to “pass through” to tenants the full cost of five property tax surcharges established since 1979 when rent control took effect.
Action’s attorney Rosario Perry says the formula used by Rent Control Administration to determine annual rent increases does not take into account the real costs of this tax liability even though the current formula does add two percent annually each year to a property’s accessed value. If Action prevails, it is predicted that rents in a rent-controlled building would rise by $140 per month for the average tenant.
Perry claims owners can only add these costs on to new rentals by charging higher rents to incoming tenants while older, established tenants get a free pass, But, I’m thinking that most owners have probably been adding these tax costs on to their new tenants’ “market rate” rents for years. Nevertheless, Perry still claims it’s unequal treatment and "unfair and unjustified”
Hello! All this time, I thought landlords were just asking for high rents because new tenants would pay them. And, isn’t the key reason for rent control to protect long-term, senior and low-income tenants and preserve their housing?
Perhaps Perry could convince owners to rent out their vacant units at lower "rent control rates" instead of at inflated market rates. Then everything would be “fair and equal.” Fat chance that’s going to happen.
Costs of taxes such as college and school bond, school parcel taxes and 2006’s “Clean Beaches and Ocean” taxes are now fully passed on to tenants. Owners don’t pay one cent of these “voter approved" taxes. So, in the interest of equality and fair play, maybe City Hall should require landlords to pay a percentage of these costs, too? How about it, Rosario?
Since 1979, apartment buildings have substantially increased in value. Most property owners are enjoying handsome capital gains. Isn’t it “only fair and equitable” they share their gains with tenants? Anybody want to sue landlords on this issue?
Action Apartment Association has been in the forefront with numerous legal challenges to the city’s rent control laws since the beginning of rent control. They haven’t prevailed in most cases. A similar complaint dealing with constitutionality issues was dismissed by the U.S. Ninth Circuit Court of Appeals, In December of 2007
In July 2004, Action sued City Hall stating that Santa Monica’s rent control laws were allegedly in violation of the 5th amendment. Action’s WAM newsletter trumpeted, “This lawsuit is the mother of all lawsuits and we will seek to have the federal court declare that Santa Monica, West Hollywood and Los Angeles’ rent control laws are unconstitutional. Once and for all, we will wipe out the regulatory processes of this SMRR (Santa Monicans for Renters’ Rights) city council (sic) which seeks to harbor rich tenants on our properties to enrich their economic life style.” Oh, brother.
Action lost and their badly-timed legal assault and their “chest-thumping” handed SMRR a big victory in the fall elections. It appears that Action and its counsel were so self-centered and selfish, they didn’t care about the blowback.
In the meantime, Rent Control Administration has recommended a two percent annual rent increase for September 2010 through August 2011 for rent controlled units. While I’m sure apartment owners will piss and moan about being “robbed," it’s a reasonable compromise. A person paying $900 monthly rent will face an $18 increase.
Congratulations to the Rent Control Administration for its good work. The full Rent Control Board will vote on the recommendation at its June 1 meeting and City Council will officially certify the increase this summer.
Bigger and dumber <p>
Item 8-B on this week’s City Council agenda is the review of Development Agreement for a 284-room hotel/commercial project at Seventh Street and Wilshire Boulevard. The project would retain and remodel the landmark Santa Monica Professional Building and add a seven floor (81-feet high) tower with a rooftop pool at the rear of the property.
Required community benefits proposed include a mixed-use, deed-restricted (affordable/ workforce/senior) housing project with ground floor retail and on a separate property at 1218 Lincoln Blvd. Improvements to Reed Park, on-site bike and car rental and local recruiting and hiring preference are also possibilities. The benefits are insufficient for this oversized project.
Holy political correctness! Item 13- C is interim Councilmember Terry O’Day’s request that council adopt a resolution denouncing Arizona’s recently approved anti-Illegal immigration law and approve a boycott of Arizona businesses. Please, Terry. You’re not running for the Senate … yet.
Instead of this inanity, “environmentalist” O’Day should call for boycotting Japan because of their ongoing slaughters of whales, dolphins and other endangered sea creatures. Remember “The Hump?”
Bill Bauer can be reached at email@example.com.