City Council Creates a Rent Stabilization Commission

City Council at the April 2nd meeting formally created a new Rent Stabilization Commission comprised of tenants and landlords and tasked with recommending changes to the city’s rent stabilization ordinance. This is only the latest step in a two year effort to amend our ordinance. Yet it is a bold move to give tenants and landlords a real voice in the process. And it is the most tangible sign to date of the city’s commitment to the effective regulation of rental housing in Beverly Hills. Read on about the membership, scope and duties of the new commission as well as the next steps in standing it up.

Last fall City Council signaled an interest to create a new commission to administer some aspects of the rent stabilization ordinance, namely the adjudication of landlord requests to terminate ‘disruptive’ tenants. Council added that for-cause reason for termination in October when it ended no-just-cause termination. Landlords needed a way to deal with ‘problem’ tenants without bringing an court action to evict, they told Council, so councilmembers searched for a more expedient process, which it incorporated into the rent stabilization ordinance last November.

The other aspect of that new provision was a local process to adjudicate the termination. It implied findings of fact and a ‘quasi-judicial’ process with rules of procedure and rules of evidence. Normally that would fall to a hearing officer; instead Council opted for an appointed panel and decided a new commission would handle it.

The next question for City Council was commission membership and responsibilities. Discussion on that continued into February but on March 5th Council nailed down some specifics. A six-member board would have the responsibility to adjudicate termination, decide relocation fee hardship applications, award rent reductions for reduced housing services, mediate habitability disputes and act as an appeals body should a landlord appeal a denied rent adjustment.

But first City Council charged the new commission with a much more pressing task: recommending changes to the rent stabilization ordinance. Lets look at the new commission and the scope of its duties!

City Council at the dais on March 5, 2019

Rent Stabilization Commission Membership

City Council decided on a 6-member commission comprised of two tenants, two landlords, and two ‘neutral’ members at the March 5th meeting. In addition, three alternates will be appointed (one for each designated member category). If the alternates choose to attend, they can participate in the commission discussion however they cannot cast a vote (unless substituting for a voting member).

Commissioner terms are staggered: three regular members will be appointed to a starting two-year term while others will begin a four-year term. (Thereafter all appointees are eligible for a second 4-year term.) All appointees must be city residents. In another departure from normal commission procedure, Council will take the lead in selecting the Chair and Vice-Chair from among the six appointed members.

The dual neutral members addressed Councilmember Les Friedman’s concern that a ‘super commissioner’ with swing-vote power could emerge from a 5-member commission if the tenants and landlords frequently voted along partisan lines.

Supporting the new Rent Stabilization Commission will be the Deputy Director of Rent Stabilization, Helen Morales, who will serve as commission secretary. Council also agreed to provide a facilitator to help the commissioners work though the ordinance changes. (Professor Singh will not be reprising his role!)

Rules and Procedures

The commission quorum requires two members from each of the three member categories be present to cast a vote. So six votes must be cast. What happens in the event of a 3–3 tie? The issue goes to City Council for the final decision. This is another break from orthodoxy: no other commission includes an even number of voting members (or loops-in Council as a tie-breaker).

Another novel aspect of this commission is that Council has empowered it to define its own process. It can also issue post or publish its own notices. Commissions are usually on a shorter leash. Take for example the Human Relations Commission: members have oversight over the Rights and Responsibilities handbook (which is required for all new tenants) but the commission cannot order the handbook to be updated. After draft revisions last fall (and we provided many recommendations) the handbook still hasn’t been revised despite important changes to the ordinance.

The new Rent Stabilization Commission will have more autonomy. The implications of that will become more clear once commissioners define a purpose. Could that include proactive outreach to the public? Perhaps a suite of tenant education materials? Might it use surveys and even semi-annual reports to keep in touch with residents who rent? (We are prepared to make those recommendations and more!)

Rent Stabilization Commission Scope

The most significant departure from commission orthodoxy concerns the new Rent Stabilization Commission’s remit: tenants and landlords now have a direct role in making recommendations to City Council about ordinance changes.

Resolved by council powerpoint matrix
Staff provided Council with a powerpoint that indicated many issues were resolved, but not all of them really were.

How to scope the commission’s task was the question facing councilmembers. They had already reached some degree of consensus on important RSO issues like exemptions for owner-occupied duplexes. But pass-through costs and relocation fees needed more discussion, and tenants were somewhat unhappy with the Council’s position on the maximum allowed annual rent increase.

Of the issues already discussed by Council,  though, none was more contentious than the probationary tenancy provision: it split the Council 3–2 whenever it was discussed.

Consequently the question of scope generated some tension at the March meeting. Staff had provided Council with a powerpoint presentation that summarized past discussions. A matrix indicated what should go to the commission. However it showed the maximum allowed annual rent increase as not yet decided (then-mayor Gold is always looking for a higher number) while the probationary tenancy was marked as decided despite the lack of clear resolution at the prior February meeting.

Lili Bosse at City Council March 5, 2019
Councilmember Lili Bosse again steps up to protect tenant interests.

Literally the moment the Council question time began, Councilmember Lili Bosse questioned the matrix of issues resolved and unresolved.

Bosse: I have a difference of recollection: on the probationary period, I thought we were going to have it go to this commission.

Gold: We had 3–2 vote [to include it in the ordinance]…

Bosse: No, Les [Friedman] said he’d agree that it could go to the commission.

Wunderlich: That was the rationale: establish the commission before we voted on the ordinance [changes].

Gold: That’s not my recollection: we agreed on the maximum increase, the relocation fees…

Wunderlich: My recollection is that the contentious one was probationary tenancy. We might have reached final agreement on the rent increase and the pass-throughs, we could have worked those out, but not because of the probationary issue….

Gold: We voted on the increase — it was CPI plus the floor and the ceiling. We agreed to that…

Bosse: No we didn’t and [referring to the powerpoint matrix] staff didn’t think so either.

Mirisch: Allow this commission to make recommendations. If they are in agreement why not make a recommendation? It’s an iterative process: let them come up with recommendations on everything. The contentious ones will come back to us. That was the point of the roundtable: to reach agreement among themselves [or] among the most reasonable ones.

Julian Gold at City Council March 5, 2019
Dr. Julian Gold, outgoing mayor and rightward pull on the rent stabilization debate.

Gold asked if no-just-cause termination was back on the table then too. (He was not a supporter of ending no-just-cause but he voted with the majority last October.) But Mirisch slammed the lid on that idea. “That’s not going to happen,” he said. Councilmember Lili Bosse agreed. “Not even on the table.”

Other councilmembers fell in the middle with respect to issues to be referred to the commission. Councilmember Bob Wunderlich suggested that the commissioners enjoy wide latitude to decide but, he said, “We can give them some focus.” A straw poll among councilmembers provided that focus (shown in our table).

RSO Amendment issues Status
Commission hears ‘disruptive tenant’ applications Resolved
Commission hears relocation fee hardship applications Resolved
Owner-occupied duplexes are exempt from RSO Resolved
Eviction notice for landlord use is extended to 6 months (from 90 days) Resolved
Evictions for owner-occupation pay 100% relocation fee Referred
Relocation fees to be paid into escrow Resolved
Allow probationary tenancy with no relocation fee Referred
Landlords must register rental units annually Resolved
Protection for teachers and students against eviction Resolved
Maximum allowed annual rent increase Referred
Reevaluate current relocation fee schedule Referred
Reevaluate allowed pass-throughs (including seismic retrofit) Referred
Reevaluate current remodeling fee schedule Referred

A few notes on the straw poll. Bosse pushed for referring both the maximum increase and the probationary tenancy to the commission for discussion; she has been the most consistent supporter of stronger protections in the rent stabilization ordinance and attended every one of the roundtable dialogues. Gold attended none of the dialogues and he wasn’t interested in referring either of those issues to the commission for more discussion.

Lester Friedman at City Council March 5, 2019
Councilmember Lester Friedman often advocates for owners who would occupy their rental properties.

Friedman was the lone dissenting voice on what was otherwise Council consensus: that property owners should pay 100% of the relocation fee to a tenant if displaced for owner-occupancy. He succeeded in referring it to the commission for more discussion.

Council's straw poll showed that these issues and more issues were still up for debate. Where the powerpoint indicated only four issues yet to be decided, councilmembers themselves referred six (most notably the contentious probationary tenancy proposal). But the commission’s scope is hardly limited to those issues. The commission has wide latitude to make recommendations on the program too.

Selection Process and Commission Stand-Up

City Council has nine commission appointments to make and debated about the best way to interview applicants. Ordinarily commissioner-applicants are interviewed by a City Council liaison committee comprised of two councilmembers and two commission members. Ultimately a recommendation is forwarded to the full Council (which then makes the appointment).

But there is no existing commission and so no commission member is available to participate. Only the two councilmember liaisons would be conducting the interviews. That was okay for Mirisch and Bosse but Gold objected; he wanted more than two councilmembers interviewing candidates (and Friedman agreed). The other problem is that no more than two councilmembers can assemble without it being a public meeting (under state law).

Councilmember Bob Wunderlich
Councilmember Bob Wunderlich
One proposal had the City Manager sitting as the third interviewer. (“No staff,” Mirisch said decisively.) Then it was suggested that two West Hollywood councilmembers be brought in to interview. (“Nobody elected them,” said Wunderlich.) Consensus quickly emerged that two councilmembers would interview candidates on videotape which would then be reviewed by all councilmembers prior to making any appointment.

But any commission-applicant video would be a public record and it could wind up on YouTube. Mark Elliot raised a hand to object and Mayor Gold (reluctantly) reopened public comment.

I have a real concern about videotaping the interviews. Applicants expect that their application will be public, but not that their interviews will be public — and those interviews can move into areas beyond the application. Practically speaking it could limit the pool of applicants. — Mark Elliot

Councilmembers agreed: instead of videotaped interviews the Council decided to form two interview panels with two councilmembers on each. They will meet in adjacent rooms for a back-to-back interview of each candidate. Now four councilmembers will have an opportunity to ask questions of candidates! Applicants, brush up on your landlord-tenant law chops!

The remaining question not discussed was who will sit on those two panels. Certainly Mirisch will participate; as incoming mayor he will make the panel appointments. Bosse has been the most engaged in the process to date and she will surely have a seat. Friedman sits on both the standing rent stabilization committee and the one formed to hear ‘disruptive tenant’ actions; he’s likely to have a seat too. Will the fourth member be Gold or Wunderlich? Mirisch will make that determination. Stay tuned!

The next step is to accept commission member applications and then interview candidates. Applications are due on Friday, May 24th, according to the information posted online. While the commission application is posted, we suggest waiting becaues we saw (and reported) numerous errors and ambiguities in the application as posted.

For more information read the draft ordinance that created the commission. For background on the March discussion where commission details were hammered out read staff report. For more on the disruptive tenant provision please read our post, City Allows Landlords (and Maybe Neighbors) to Request Termination for ‘Disruptive’ Tenants. And of course watch the video from the March meeting for the lively discussion. Local government at its best!

Do you have any questions or thoughts about the new commission or the steps ahead? Get in touch with Renters Alliance.

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