It started nearly a year and a half ago, but the city's most vexing landlord-tenant dispute has finally reached a resolution.
At its Monday, Feb. 11, meeting, the Rental Housing Committee signed off on a final decision for the case involving the Del Medio Manor apartment complex. In 2017, the Lindsay family, the owners of the 105-unit property, sought to raise rents beyond what's allowed by rent control on most of their tenants by filing a petition through the city's rent control program.
After being rejected by a city hearing officer, the case turned into a prolonged battle that went through multiple appeals and reviews. In the final decision approved Monday, city officials said the landlord did not provide sufficient evidence to justify rent increases on a property that earned just under $1.3 million in profit in 2017. As part of the decision, the landlord will be restricted to increase rents on most tenants by only about $20 a month.
The case remained hard fought to the bitter end. At the Monday night meeting, committee member Vanessa Honey insisted on revisiting nearly every aspect of the decision made by the city hearing officer who ruled on the case. On many points, Honey argued that the hearing officer got it wrong.
Honey suggested that tenants' rent increases should include the landlords' fees to the California Apartment Association, the lobbying group that has fought to curtail Mountain View's rent control program. At one point, she argued that the salaries of property managers should count as maintenance, not as managerial expenses.
In its original petition, Lindsay Properties had listed about 20 percent of the property's revenues as being management expenses. The city's rent control policies allow only 6 percent to go toward management, but there is no cap on maintenance costs.
Speaking for her family business, Cynthia Lindsay Christensen blasted the city's process for excluding various expenses and holding her company to a higher burden of proof than her tenants.
"How can you possibly disqualify these legitimate expenses?" she said. "How can you expect us to maintain our property when we're paying half of what we should be earning?"
Several motions made by Honey to increase rents by including additional expenses were rejected in 2-3 votes, with committee members Emily Ramos, Susyn Almond and Nicole Haines Livesay opposed. Only one expense was approved -- about $44,000 spent to repave part of the apartment complex's parking lot. On that item, the city's hearing officer had sided with tenants, finding that this resurfacing was unjustified based on evidence provided by the landlord.
It was a simple "judgment call," where reasonable people could differ, said Haines Livesay. She broke ranks on this item for a 3-2 approval. It was not immediately clear how much this expense would raise rents for tenants.
Attorneys representing the Del Medio tenants also had misgivings with the final decision. Margaret McBride of the Community Law Services in East Palo Alto poked holes in the final decision, arguing that it used bad math for different expenses and different years. Her concerns were mostly ignored.
Now approved, the final decision has fully proceeded through the city's adjudication process. Any further challenges would need to be taken up through a civil lawsuit.