Can you afford a 6% permanent rent hike? Can your neighbor?

Soaring inflation is forcing Santa Monicans to contend with a climbing cost of living, as the prices of groceries and gas are on a steady incline. But for the over 70% of Santa Monicans who rent their homes, a rise in inflation means a potentially untenable rent increase this year.

Rent control is the law, the will of the people, expressed and reinforced numerous times since 1979 both at the ballot box and in court. Rent control is not for “poor people.” It’s a cloth that is laid over the entire community to protect the 72% of citizens who are renters from the rapid accelerations of speculative real estate. To ensure community stability and economic opportunity, for the good of our schoolchildren and our workforce, in order to prevent more homelessness, and to help ensure that our seniors age gracefully and in place, we must reasonably protect our renters from soaring rent increases that are not sustainable. Rents have increased rapidly since our last economic downturn. In fact, an income of nearly $110,000 would be needed for a 4-person household to afford a one-bedroom unit in Santa Monica if rented at the median market rate.

Because of 1995’s Costa-Hawkins Act, Santa Monica has had vacancy decontrol for 23 years, allowing landlords to set rents at market rate for any new tenancy. The impacts have been far-reaching. In 1998, prior to vacancy decontrol, rents for 84 percent of units in Santa Monica were affordable to households living at low-, very low- and extremely low-income categories. Today, just 4.2 percent of controlled units’ rents can be considered affordable to such households. Santa Monica has already become economically gated for so many. We firmly believe we must make intentional policy decisions to promote an inclusive and thriving City. The ability to remain in the community, to partner up, get married, to open a small business, to adopt or have children reinforces the need for a protective cloth for all.

That protective cloth is being threatened with the unique confluence of world events, culminating in a 6% rent raise that will be baked into Maximum Allowable Rents forever on September 1, 2022. There are relief programs for some renters, but these resources are thin and some are ending. LA and almost all other rent control jurisdictions have already acted to lower or to stop rent increases, but the way our Rent Charter is currently written, the Rent Board does not have the power to act this year. So how do we stop this?  Two ways.

The Immediate-Term

We believe that City Council and City Staff have emergency powers they can use under current conditions to provide a one-time fix to this bizarre and unforeseeable crisis. In fact, last week, the Oakland City Council, facing a very similar situation, passed a maximum rent increase cap of 3% for their rent-controlled tenancies. Rent-burdened tenancies are a threat to public health and to the fabric of this community and should be protected from displacement and gentrification. We urge City Council to cap this year’s rent increase at a reasonable amount and to act before the new rent increases go into effect on September 1st. This crisis will pass, but the time to act to prevent the cloth from ripping to shreds in the meantime is now.

The Future

We, the Rent Control Board, have sent Council a basket of good governance measures that we ask to be placed on the November ballot to save money and to make common sense fixes. Council will consider this bundle of changes this summer. One of the key items in that basket is a tool to give the Rent Board the ability to mitigate future rent spikes in extreme conditions that threaten the public good and public health, like sky high inflation. We currently cannot. Measure GA voted in 10 years ago (and our only method of calculating rent increases) did not foresee such a confluence of events. We are already well into the calculation period for NEXT year’s rent increase. What could that increase amount to? We need this tool and will ask the Council and then you, the voters, to support our Rent Charter Amendment with a YES vote in November.  

We want to ensure that Santa Monica remains a thriving and inclusive community for all. We urge City Council to take immediate action to protect the fabric of our community, both now and in the future. 

Commissioner Caroline Torosis & Vice-Chair Anastasia Foster