Rent Stabilization Update: What’s Next?

Months have passed without a single word from City Hall about rent stabilization. No press release, newspaper announcement or website update has keept us informed. Officials let weeks go by without a reply. And don’t get me started about the programs that must be better managed if they are to properly serve tenants. What gives with the silent treatment? Is City Hall on hiatus?

The extended holiday period has been a quiet for City Hall. The reticence is troubling because we have behind us a year of policy talk but no new rent stabilization program up and running to help tenants who face landlord harassment, excessive rent increases and more. But work goes on in the background, we’re told.

By the city’s measure progress is good on the required registration of rental properties. That is the first step toward an effective rent stabilization program. We’re past the close of the first registration but the reported numbers don’t add up. The Courier recently quoted city officials as saying the city has registered 1,073 properties comprising 7,507 rental units. Add the 11 properties not yet registered (another 50 units) and the totals rise to 1,084 properties and 7,557 units. That is far short of the number of rental units counted by a city’s survey in April.

And the number of tenant appeals of the landlord-reported rent is awfully low. Just a few in a city of 7,500 renting households. It is critical that the allowable rent be accurate because all future rent increases build on that number. Given the small number of rent appeals probably few tenants dug into past rent receipts to check.

These are background steps toward a Rent Stabilization Program and they are important. But what are we looking forward to? Renters Alliance reached out to Community Development Director Susan Healy Keene for a brief, unplanned and impromptu update.

Rental unit registration is nearly complete. Owners of 98% of rental properties have substantially complied with the registration requirements. That’s up from about 80% in December. Today only 11 properties (about 50 units) are not registered. Having failed in their lawsuit to invalidate the registry, recalcitrant landlords then faced penalties for non-registration. As I suggested back in December, is seems the smaller properties – mostly duplexes – are more likely to be not registered.

Registered rental properties number 1,073 (7,507 housing units) according to the Courier’s recent report. are registered. That is a sharp drop from the 1,131 rental properties the city tallied in last April’s Rental Housing Initial Data Survey. That survey counted 8,662 rental housing units based on various city data (likely utility bills). That is a whopping difference.

Rents are now ‘certified’ (established as the lawful rent) for more than 99% of rental units. In most instances tenants and landlords were able to agree on the rent charged. In other cases a discrepancy was resolved administratively. In just three cases (out of more than seven thousand) was a discrepancy unresolved, and in those instances the dispute went to a hearing officer. Why does this matter? The certified rent is the baseline from which future increases are calculated. It is important that the figure be accurate and reflect only lawful past rent increases.

Our rent stabilization program still has no dedicated manager. City Council in September agreed to hire a rent stabilization executive director. That is important because¬†responsibilities are split between Community Development Director Healy Keene, Assistant Director of Community Development Raj Patel, and Community Preservation (aka code enforcement) Nestor Otazu. Without an official in charge accountability is diffuse; nobody can be held responsible for systemic failures. Yet the position remains empty. Interviews are commencing, we’re told.

The timeline for completing a final rent stabilization policy will stretch to nearly two years. I expected the policy process to wrap last fall when the process kicked-off a year ago. How mistaken I was! The timeline has been pushed back because the consultant hired to conduct an economic study now anticipates it will be delivered in August (not April as expected). That pegs City Council action sometime in September – and that is a best-case scenario. While the 3% annual cap and relocation fees do remain in effect, there has been no progress on new tenant protections. For example, no-just-cause eviction is still allowed.*

The next step in the policy process will likely be another tenant-landlord facilitated dialogue. City Council had expressed interest in again hiring Professor Sukhsimranjit Singh from Pepperdine’s law school and he apparently he will have another chance at bat this summer when he presents the consultant’s preliminary findings to tenants and landlords. We don’t know what that process will look like, but expect a return of at least one facilitated dialogue.

Officials say they want to reach out to tenants and landlords. Finally some interest from our rent stabilization officials to talk to tenants about the process! Indeed last such effort was a¬† ‘workshop’ to introduce changes to the rent stabilization law – and that was nearly a year ago. Tenants have many questions about how housing laws generally affect them, and we want to know what the city can – and cannot – do to protect our rights. Outreach and education can’t come too soon. Still, I’ll believe it when I see it: my many recommendations for additions (and even corrections) to the city’s rent stabilization webpages have gone unheeded.

These are necessary steps toward a functioning rent stabilization program. And our hat is off to Helen and the officials that work the levers; there has never been any certainty that the program will endure and nobody wants to feel their labor is wasted. Still it would be good if City Hall could reach out proactively and keep tenants informed. We’re more than half of city households and we are deeply invested in a new ordinance.