Alameda City Council Unanimously Extends Moratorium on Evictions & Rent Increases; City Poised to Adopt Permanent Rent Control Law

Early Wednesday morning, the Alameda City Council unanimously extended the City’s moratorium against evictions and rent increases. The moratorium was set to expire January 9, 2016. It has been extended 60 days. Under the law, landlords must have “just cause” to evict and cannot impose rent increases above 8%. The extension of the moratorium was crucial to prevent rent gouging in anticipation of the adoption of a more comprehensive rent control law. This is a huge victory for the Alameda Renters Coalition and builds momentum for their campaign for meaningful rent control.

The Council considered three options to address rising rents and displacement, but approved none of the options at the meeting that lasted nearly nine hours. Instead the Council stated areas of agreement and asked staff to draft an ordinance for the Council to vote on in February.

The Council mainly discussed the weakest option, beefing up the Rent Review Advisory Committee (RRAC), the city’s existing rent mediation program. However, critics argued, and city staff and council members acknowledged, that this option would not stop a landlord from imposing large rent increases. Decisions of the RRAC are nonbinding.

The strongest option before the council was rent control with just cause for eviction protections. However, Alameda Renters Coalition correctly argued that the staff’s draft made mistakes in allowing annual 8% rent increases and allowing permanent evictions for capital improvement work. Nonetheless, the option provided a decent framework and starting point for discussion of a real rent control law. However, this option did not attract support of the majority of the council.

The council indicated that it would like staff to work out an entirely new ordinance, one that Councilmember Spencer described as "RRAC with teeth." Some features discussed include disincentivizing rent increases over 5% annually by requiring mediation or arbitration if a landlord wanted to increase rent above 5%, requiring landlords to offer tenants a year lease at the time of a rent increase, requiring landlords to pay relocation payments to tenants facing no-fault evictions, and limiting the rent for the unit for new tenants following no fault evictions. Staff says they will have new ordinance available to council for 1st reading in February. The Council expressed the desire for the ordinance to contain a sunset date; 2019 was contained in the staff recommendation.

Notably, the City Council appears to have rejected including eviction protections in the ordinance. Tenants Together Legal Director, Leah Simon-Weisberg and countless Alameda residents emphasized the need for eviction protections to provide stability to renters who pay their rent and comply with their obligations. However, the City Council appears not to understand that allowing landlords to evict tenants without a reason, even with rent control in place, doesn't do much to help tenants.

Landlord lobbyists, who oppose any enforceable regulations on rent, continued to push the idea that landlords increasing rent any amount under 10% is acceptable. City staff proposed one option of an 8% rent increase cap, presumably modeled on San Jose, which is actually in the process of revising its ordinance following a poll showing widespread support for reducing rent increases far below the allowable 8%. (San Jose adopted at 8% cap at a time when that figure was related to high inflation rates.)

8% rent increases are too high! Just ask #SanJose advocates: @LawFoundationSV @wpusanews @PACTSJ @sbtu95 @SVDebug https://t.co/UhWI4akKkc

— Tenants Together (@TenantsTogether) January 6, 2016

One councilmember in Alameda expressed interest in 6% increases and another wanted to focus on cumulative increases being no more than 12% in two years, but neither provided justification for any of these figures. Only the renters’ coalition proposed numbers grounded in anything. ARC pushed rent increases tied to CPI (inflation), the approach used by virtually every rent control city and regularly upheld by the courts.

.@gaylonparsons AND most cities with #rentcontrol base rent increases on inflation (CPI): Santa Monica, Berkeley, Oakland, Los Angeles...

— Tenants Together (@TenantsTogether) January 6, 2016

The public testimony from renters and homeowners in support of rent control was powerful. At 10:30 pm, a large group of high school students who had been waiting hours to speak asked to be taken out of order so they could get home and get some sleep before school the next day. They spoke about the impact of rent increases and the threat of displacement on them and their families. Long-term tenants from all walks of life spoke about the need to protect residents and stop displacement.

In #alameda we have baller high schoolers who are engaged in the civic process #organize #alamtg #rentstabilization pic.twitter.com/cXBUxZdBjA

— Malia Vella (@Malia_Vella) January 6, 2016

Thanks to tireless organizing by the Alameda Renters Coalition the moratorium is in effect preventing the worst abuses for now, and staff has been directed to prepare a new ordinance for the council’s consideration in February. ARC will continue to organize for real rent control and just cause for eviction protections. In the meantime, ARC should celebrate this latest victory in moving the City of Alameda one major step closer to adopting an effective rent control law to protect city residents from unfair rent hikes and displacement.

Quote of the night on rising rents #alamtg "It's family stability on one side and profit margins on the other." @Alameda_Renters spokesman

— Steven Tavares (@eastbaycitizen) January 6, 2016

Why is the head of a CA affordable housing agency evicting tenants from affordable homes?

You may have heard about the Ellis Act exacerbating the housing crisis in San Francisco. To recap: real estate speculators are buying up rent-controlled apartment buildings for a (relative) bargain. Property values are low because the rents are lower (less than than, say, $4000 a month for a two bedroom apartment) so new owners get a pretty sweet deal, considering the value of the land is actually very high. Then under the Ellis Act they evict the whole building of its tenants in order to turn the units into condos, TICs, or demolish the building entirely. The Ellis Act isn’t used by professional landlords. It’s used by real-estate speculators who want to make a quick profit. 78% of Ellis Act evictions happen within the first five years of new ownership.

It’s not just a San Francisco problem. Any tenant protected by rent control could become a victim of an Ellis Act eviction.** Last year 725 rent-controlled units disappeared in Los Angeles, and since 2001 the city estimates a total of 19,000 homes have been lost. Santa Monica has lost nearly 2000 homes. Housing activists like me hate the Ellis Act, because I fight everyday to keep people in their homes.

Advocates don’t always talk about it this way, but homes protected by rent control are the largest stock of affordable housing in California. In this housing crisis, we can’t afford to lose ANY KIND of affordable housing. However, to take one example, in San Francisco we are losing more affordable homes under rent control than we can catch up to that loss by building more.

Now instead of helping in this crisis, the chair of the California Housing Finance Agency (CalHFA) Board, a government agency tasked with supporting affordable housing is doing the opposite: evicting his tenants using the Ellis Act. The irony was thick enough to attract national attention. By evicting rent-controlled tenants, Matthew Jacobs is removing affordable housing from the market, and even plans to build luxury housing in its place.

Matthew Jacobs was appointed by Governor Brown to his board position. According to its website, CalHFA “supports the needs of renters” and “programs that create safe, decent and affordable housing opportunities for low to moderate income Californians.” This hypocrisy is a tough pill to swallow. Right when tenants and families are fighting to stay housed, when the first time in history the outmigration of people from California is greater than the migration here because the cost of living is too high, when tenants unprotected by rent control are facing 400% rent increases, Governor Brown has appointed a fox to protect the henhouse. Matthew Jacobs has no right sitting on the California Housing Finance Agency board and the Governor should take the action necessary to have him removed immediately.

What are we doing about it? Hundreds of tenants are being unfairly evicted though the Ellis Act, but the state legislature sits on their hands. Modest legislation to amend the Ellis Act stalled thanks to the political power of the California Association of Realtors, the biggest donor to state politics, that profits from real-estate flipping and displacement. Meanwhile, long-term tenants are losing their homes. Activists are taking to direct action to the streets and to the ballot to fight back.

Our next opportunity at the state level is next Tuesday July 14th when CalHFA holds its first board meeting since the news broke about the evictions. So far CalHFA has released a statement supporting Jacobs. "As the chairman of the CalHFA Board, Mr. Jacobs has fully supported the mission of the Agency by providing oversight on the implementation of financing and administrative programs to increase affordable rental housing throughout the state so more Californians have a place to call home.”

It’s clear that CalHFA doesn’t understand the gravity of the situation. So victims of Ellis Act evictions are going to educate them by testifying at the next board meeting, including Steven Luftman, the last tenant standing in the Los Angeles building emptied of his neighbors by Jacobs and the Ellis Act. Since the meeting is in Sacramento, we’re also going to confront the halls of power at the Governor’s office to demand his removal with letters sent from all over the state.

If you can, join us in person at 801 12th Street, Sacramento, 9:30am, July 14.

If not, there are three ways to support tenants and affordable housing:

Send a letter to the governor demanding that he remove Jacobs. We already have 800 letters and want to bring at least 1000 with us Tuesday.

Call CalHFA (Director’s office: 916.326.8000) this week to demand that Matthew Jacobs be removed from the CalHFA board.

Donate to Steven Luftman’s GoFundMe campaign to cover the cost of his flight from Los Angeles to Sacramento next Tuesday. It’s important that Steven can confront his evictor in the halls of power and be there to deliver our demand letters to the Governor.

Mark your calendar and attend the next CalHFA meeting in Southern California. It’s in Burbank on September 10. Join the Tenants Together email list to get updates.

** That’s only because rent control usually comes with eviction protections called “just cause,” meaning that a landlord has to give a reason to evict you. In most cities in California, landlords can arbitrarily evict tenants and wouldn’t need to use the Ellis Act. You only need the Ellis Act if you want to undermine rent control and just cause protections. If you just want to “get out of the landlord business” as the Ellis Act states, really you can just sell your building to someone else who does want to be a landlord.

Originally posted on DailyKos

What "Market Rate" Really Means

A tenant's letter to the Board of Supervisors of San Mateo County, John Maltbie, County Manager, with a copy to the Daily Journal:

Dear Supervisors and Mr. Maltbie:

I've attached a copy of a marketing promotion for a multi-unit building in Burlingame for your reference. In it, you will see on page 4 that the realtor is suggesting to buyers that, should they buy the property, they can easily raise rents to all of the tenants and achieve "market rate."  So, a person in a studio can expect a $700 increase, and a 1BR can be increased by $1,200.  This building has actually been sold.

On pages 11 through 14 you can see the comparables and just imagine the impact on the renters of all of those buildings after experiencing new ownership.

"Market rates" are being set by predatory speculators.  In Burlingame a couple of weeks ago, a "representative" from Marcus & Millichap was doing a "survey" of renters he would see in front of their buildings, and after asking a few friendly questions, would ask how much rent the tenant was paying.  One can only imagine where this "survey" is headed.

Owners are being told that if they keep their rents at reasonable levels, their property values will plummet. So they must keep up with the Joneses and impoverish or economically evict their long-term and even valued tenants.

Large corporations are snatching up apartments and rental homes for their employees, paying 30% and more above "market rate," setting new "market rates" for others to achieve.  Average working people have to compete for housing with very high earners, and now even their corporate employers with billions of dollars behind them.

Renters are the infrastructure of San Mateo County, and we are being dismantled piece by piece Please take leadership of this crisis and pave the way for the Cities to defend our infrastructure, our people, and institute rent stabilization immediately where you can.

Sincerely,
Cynthia Cornell
Burlingame Advocates for Renter Protections

Time to Overhaul Costa Hawkins

by Dean Preston, Tenants Together Executive Director

Residents of 901 Jefferson Street in Oakland are protesting increases ranging as high as 120% from their new, multi-billion dollar corporate landlord.  In Daly City, Oscar Moreira is facing a 41% increase.  In San Francisco, Debra Follingstad just received a notice from her landlord that her rent in San Francisco will increase 400%.  In Redwood City, Martha Ortega got hit with a 125% rent increase.  Across the Bay Area, rent increases in the double and triple digits are increasingly common.

If there was ever a time for widespread adoption of new rent control ordinances, the time is now.  As rents soar, many cities are considering adopting new rent control ordinances.  Richmond, Alameda, Burlingame, and Redwood City are among those where advocates are speaking out for rent control.  Rent control is essential in these cities as tenants face rent increases exponentially greater than any rise in landlord operating costs.

Even with local rent control laws, however, many tenants will continue receiving huge rent increases thanks to the outdated Costa Hawkins Rental Housing Act, a state law adopted in 1995 that is in desperate need of an overhaul. In a timely piece in the East Bay Express recently, Robert Gammon noted:

Rents, in short, are officially out of control. And the skyrocketing prices are making apartments much too expensive for many longtime residents. Unfortunately, however, the city can't do much about it. Why? A twenty-year-old state law known as the Costa-Hawkins Rental Housing Act blocks Oakland and other California cities from adopting sensible rent control rules that could help keep rent prices from getting even higher.  Costa-Hawkins, which doesn't get nearly enough attention from the news media, prohibits Oakland from establishing rent control on buildings constructed after 1983. That means that about one-third of all rental units in Oakland — 32,000 out of 92,000 — are exempt from the city's rent control regulations.
-East Bay Express, “It’s Time to Overturn the State Ban on Rent Control” (Robert Gammon, March 25, 2015.)

Costa Hawkins deprives cities the most effective tool they would otherwise have to reign in rent-gouging landlords: strong rent control.  Costa Hawkins ties the hands of cities, barring them from applying rent control to certain kinds of housing – including condos, single family homes, and units built after 1995 -- and barring cities from regulating rent at the time tenants move in.  Costa Hawkins also bars cities from moving their exemption date, so cities that had exemptions for new construction in their local laws when Costa Hawkins passed are stuck with those cutoffs.  That’s why, as Gammon notes, Oakland cannot apply rent control to anything built after 1983.  Cities are also blocked from applying rent control to the single family homes that are increasingly being bought up and rented out by Wall Street investors.

A growing number of tenants in California live in units that are exempt from rent control under state law.  Tenants in those units need protection from exorbitant rent increases.  Such rent increases contribute nothing to local economies and drive tenants into poverty and homelessness. Landlords do not have a legitimate need to impose these kinds of increases.  Many reasonable landlords would never think of imposing such massive increases.  Landlords who do impose such increases during a housing crisis, their rent gouging must be stopped.

Californians overwhelmingly support rent control.  The last referendum on rent control – Proposition 98 in 2008—was decided against landlords by a 22-point margin statewide.  Support continues to grow as people see landlords imposing massive rent increases during an affordable housing crisis.
Sacramento politicians are another matter.  The landlord lobby has invested millions into political candidates, making statewide change difficult.  Nonetheless, ask even the most reluctant politicians if they believe a landlord should be free to double their constituents’ rents, and they will usually respond in the negative.  In other words, they support rent control, they just won’t admit it.
Two things must happen to stop the current epidemic of rent gouging in California. Cities without rent control should adopt rent control laws. Equally important, the state Costa Hawkins law must be changed to allow cities to take action to protect all tenants without interference from Sacramento.  Landlords have had a 20-year period of windfall profits thanks to Costa Hawkins.  Tenants statewide must organize against this special interest law that is allowing rent gouging and abuse of tenants.