The Rent Control Board appeared to put the kibosh on the possibility of broad rent control reform this November once and for all at their April 12 meeting when Boardmember Todd Flora moved to suddenly cancel any public discussion of a proposed ballot initiative from staff.
Looking out at a packed chamber, Flora suggested they table the discussion rather than listen to a group of angry landlords who showed up to voice opposition to vacancy control.
“I really don’t think this is going to pass and I’m going to propose something bold … to avoid a lot of the unpleasantness that’s about to come our way from about thirty people,” Flora said, explaining he wished to save everyone “two hours of a lot of hell.”
His fellow commissioners unanimously agreed and quickly approved a motion to indefinitely table the agenda item concerning vacancy control. While the City Council could take up the cause, they would do so without a recommendation from fellow elected leaders on the RCB.
The discussion on broad reform hinges on the Affordable Housing Act, a proposed statewide initiative that is still gathering signatures to qualify for the November ballot. The initiative would repeal Costa-Hawkins, the state law that eliminated the RCB’s authority to set maximum allowable rents in any apartments built before 1978.
Before Costa-Hawkins, Santa Monica had one of the most progressive rent control laws in the country. A few weeks ago, the RCB’s own attorney wrote a memorandum warning voters could inadvertently could throw a wrench into the City Charter if they pass the Act, allowing new tenants to argue for 1978 level rents.
“Will Costa-Hawkins be repealed? Nobody knows,” Lewis said at the public meeting. “It’s certainly not something that is outside the realm of possibility.”
Lewis told the Daily Press he thought it was prudent to warn the RCB of the possible loophole. He suggested an amendment to the City Charter that would tie the rent ceiling to April 2018 in the event Costa Hawkins suddenly disappears.
Landlords reacted quickly to the staff suggestion of reinstating vacancy control and flooded the inboxes of elected officials. In fact, the Board received more than 100 emails on the matter, mostly from angry landlords worried about losing their ability to raise rents when a tenant moves out.
“Imposing vacancy control would destroy my retirement plan,” wrote landlord David Miller. “Imposing vacancy control would not create one more unit of housing.”
At the meeting, multiple boardmembers said the timeframe to get a companion measure in front of Santa Monica voters was simply too short. In March, there was little consensus over how a measure should look.
“It would be irresponsible for us to rush to judgment by putting something on the ballot that’s not well thought out without proper stakeholder engagement,” Boardmember Caroline Torosis said in an email to the Daily Press. If Costa Hawkins were to be repealed, she would look at expanding rent control to more recent construction. “That would require careful study. I’m interested in providing stability and maintaining what little diversity we have left, and I want to do so in a thoughtful manner.”
At the April 12 meeting, Flora expressed doubt the statewide initiative will pass.
“My concern is there has been really a tremendous amount of anxiety stirred up this week that I think is really unnecessary. We did not ask for us,” Flora said of staff’s recommendation. “This board did not ask for the statewide initiative.”
Santa Monicans for Renters Rights, the influential political group that helped establish rent control here in the 1970’s, opposes any local companion initiative to the Act.
“SMRR believes the prudent course is to await the November election results, and, in the event the AHA passes, work toward a ballot measure approved by the City Council, and a special election funded by the City Council,” the group wrote in an April 11 email to the RCB.
The RCB may still recommend an initiative for the November ballot that addresses tax-based surcharges passed down to tenants in rent controlled apartment buildings. In January, the Board eliminated the surcharges for new tenants and new landlords and now wants to provide relief for tenants who saw their surcharges skyrocket along with property values in the city by the sea.
The city is one of the few rent control jurisdictions that allowed building owners to pass through certain taxes approved by voters. Tens of thousands of renters currently apply surcharges on Measure X, S, BB, and AA. Landlords can also pass along a stormwater management user fee, the clean beaches and ocean parcel tax and a 2008 school district special tax.
The median combined surcharge amount for renters is $24.41 but can vary widely from unit to unit depending on the assessed value of the property. The highest monthly surcharge paid by a tenant is $137.03.
The RCB will continue to discuss a cap on surcharges at the May 10 meeting at City Hall.