On April 8, members of the Rent Control Board voted unanimously to support AB 854, which strives to limit the use of Ellis Act evictions by speculative property investors.
Currently landlords can purchase rent controlled buildings and then immediately use the Ellis Act to exit the rental business, evict tenants, and sell the property for a higher price.
Assemblymember Richard Bloom (D-Santa Monica) and Assemblymember Alex Lee (D-San Jose), believe this goes against the original intent of the 1985 Ellis Act, which was enacted to help mom and pop landlords who couldn’t afford to maintain their properties.
On March 22, Lee introduced AB 854, which was co-authored by Bloom and strives to end the speculator eviction loophole of the Ellis Act by requiring landlords own property for at least five years before invoking the act.
The proposed bill also intends to blunt the practices of “serial evictors” who continuously evict tenants from multiple buildings using the Ellis Act. If passed, AB 854 would prevent landlords from withdrawing additional property from the rental market, if that property was acquired within 10 years of a landlord previously using the Ellis Act.
“We need common sense changes to Ellis and similar acts that force those acts to be used in the way they were intended to be used,” said Rent Control Commissioner Anastasia Foster. “So I applaud the bringers of this piece of legislation including Richard Bloom.”
According to a memorandum prepared by Alison Regan, general counsel to the Rent Control Board, Santa Monica has seen a widespread increase in the number of Ellis Act evictions in recent years and, consequently, in the number of rent controlled tenants displaced.
“Building more housing is important, especially as the state begins its recovery from the pandemic, families, seniors, disabled people and young working adults need housing stability,” said Assemblymember Bloom, who resides in Santa Monica. “We should not be pushing them out of their homes, their communities, because of legal loopholes in the Ellis Act.”
While the initial 1985 law was targeted at small landlords, subsequent court decisions have allowed it to be interpreted vaguely and applied extensively.
“This is contrary to the spirit of the Ellis Act when it was passed more than 30 years ago. AB 854 restores that spirit,” said Bloom.
Rent Control Board members believe AB 854 is in line with the regulatory functions of the Board, which include limiting the displacement of tenants from rent controlled units. As a result of their endorsement, letters of support will be sent to the bill’s authors.
A hearing on the bill is currently scheduled in the Housing and Community Development Committee for April 15.
Clara@smdp.com
