News

Rent control reform measure heads to voters in March

Mountain View City Council backs 4% annual apartment rent increase, excludes mobile home parks

In an attempt to soften the city's rent control law, the Mountain View City Council on Tuesday night approved final language for a ballot measure that would go before voters in the 2020 March primary election.

The city-sponsored measure has been under development for nearly six months to revise the local rent control regulations known as the Community Stabilization and Fair Rent Act (CSFRA) that voters approved in 2016. The Tuesday, Nov. 12, meeting was the most important discussion so far because city leaders filled in many integral details that could determine how voters respond at the ballot box.

Most crucial for landlords and tenants alike, the City Council agreed to a measure that would raise the city's annual cap on rent hikes to a flat rate of 4%. Under the current rules, the maximum rent increase fluctuates each year based on the regional inflation rate, a system similar to how most other California cities administer rent control laws. For 2019, that rent cap is set at 3.5% for Mountain View.

Setting the right amount for allowable rent increases has been the big question for months as city leaders deliberated the measure. Councilwoman Margaret Abe-Koga has insisted that the city needed to allow higher rent increases in order to prevent more apartments from being torn down and redeveloped. In past meetings, she advocated for a 5% increase, but she joined her colleagues in supporting 4% on Tuesday night.

"This is an attempt to incentivize housing providers to stay in the market and not take them off," she said. "You don't always get what you want all the time, but I think this is an attempt to build a compromise."

To her point, Councilman Lucas Ramirez, who has repeatedly warned against putting higher rents on tenants, said he would support the 4% higher increase, describing it as a "reasonable compromise." The lone opponent was Councilwoman Alison Hicks, who described raising rents as a deal-breaker that would kill the measure's chances at the ballot box.

It is debatable to what degree rent control has galvanized property owners to redevelop older, affordable apartments. While many elected leaders see a direct link between the two, tenant advocates say that the number of redevelopments has been no higher since rent control was enacted. Conversely, Assistant Community Development Director Wayne Chen told city leaders that there was no certainty that allowing higher rents would slow down redevelopment projects or the displacement of tenants.

"It's hard to say whether dialing this variable leads to a specific outcome," he said. "It's a difficult question to answer. You'll hear a variety of perspectives on what motivates a landlord to stay or exit the business."

Any attempt to fiddle with rent control touches on perhaps the most volatile and divisive issue in Mountain View politics. The 2016 rent control law, which covers about 15,000 apartments in the city, has become a policy as fiercely guarded by tenant advocates as it is loathed by landlords.

Prior to the city's interest in reforming CSFRA, another ballot measure to reform rent control was already well underway. Last year, a coalition of landlords and their advocates collected thousands of signatures for a measure known as the "Mountain View Homeowner Renter and Taxpayer Protection Initiative." In most circumstances, that measure would essentially neutralize rent control in Mountain View.

That voter-initiated measure was still in play, and city officials were obligated on Tuesday night to decide when both measures would be brought before voters next year. In the end, the City Council agreed to split up the two measures, bringing the city-sponsored measure to voters in the March 3 primary election while the landlord-backed measure would be postponed until the Nov. 3 presidential election.

By staggering the two measures, the city would have leverage to convince landlords to withdraw their initiative, said Councilman Chris Clark. If the city's measure passes in March, he expressed confidence that apartment owners' opposition to rent control would be mollified.

"It's possible that we'll have some means to approach them and say, 'Is this really worth it?" he said. "The compromise we're talking about is that this is better for property owners than the (CSFRA), so it might be enough that it's not worth fighting the battle this year."

In response, Ramirez questioned the logic of spreading out the ballot measures over two separate elections. It was highly unlikely that landlords would drop their measure, and instead this would mean the community would face two grueling fights over rent control, he warned.

"By any metric, their measure is better for property owners," he said. "And it's already qualified, so why wouldn't they go for it?"

When asked by the Voice, Joshua Howard of the California Apartment Association said this was the first instance he had heard of city leaders seeking a withdrawal of his group's measure. At this point, there was no interest in pulling it back, he said.

"Over 15% of Mountain View’s voters signed the petition to reform Measure V to ensure that rent control does not disproportionately benefit wealthy, high income renters at the expense of the low and middle income renters who need housing assistance the most," Howard said in a statement. "We believe the voters should have a chance to weigh in on this measure."

Another important amendment added to the city's measure dealt with capital costs on apartments that could be passed through to tenants as rent increases. Under the current rules, landlords seeking a higher rent increase must file a petition and provide extensive documentation to show any capital improvements are necessary.

This process has been criticized for being too slow and onerous, and City Council members have sought a streamlined system to quickly give apartment owners compensation for important upgrades such as seismic retrofits or safety improvements. As part of this criteria, elected leaders also included environmental improvements, such as solar panels or electric car charging stations. On Tuesday night, a majority of the City Council agreed to make it so these expenses could also passed through as rent increases even if there was no cost benefit for tenants.

The expedited process to pass through costs to tenants was blasted by public speakers, who said the criteria had become too broad. It was just one more example of how tenants had little reason to support the measure, said former Councilman Lenny Siegel, now representing the Housing Justice Coalition.

"People know what's going on in this city; they know who dominates the City Council, who dominates the Rental Housing Committee," he said. "They don't trust any little loophole will stay a little loophole. It will become so big you can drive an apartment redevelopment through it."

In another move that irked tenant advocates, the City Council agreed the measure would allow apartment owners and property managers who don't reside in Mountain View to serve on the city's Rental Housing Committee, which administers the city's rent control policies.

The City Council also decided in a last-minute amendment to explicitly exclude mobile homes from the city's rental protections. For years, a coalition of mobile home residents have been urging city leaders to do something to restrict rampant rent increases by their mobile home park ownership. But it has remained unclear whether mobile homes should be covered under the city's rent control law, despite multiple lawsuits. City leaders have promised they will take up the issue at a study session in January.

The final language for the council's ballot measure to revise the local rent control laws was approved by the City Council in a 5-2 vote with Hicks and Ramirez opposed. If the measure is passed by voters in March, the law will take effect in September, or even sooner with council approval.

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Comments

70 people like this
Posted by Randy Guelph
a resident of Cuernavaca
on Nov 13, 2019 at 2:56 pm

Yet another event in the long history now of City Council trying to nullify the will of the people of Mountain View. Letting non-residents sit on the Rental Housing Committee is absurd!


39 people like this
Posted by Huh?
a resident of Bailey Park
on Nov 13, 2019 at 4:28 pm

It's going to the voters. How does that nullify the will of the people?


41 people like this
Posted by @Randy G.
a resident of Blossom Valley
on Nov 13, 2019 at 6:18 pm

The Voice did not write the story accurately.

The RHC, as written under Measure V, states that NO MORE THAN 2 real estate people are allowed to sit on the committee. Because most landlords live out of town, and in the case where the RHC seeks new members, AND there are NO qualified applicants for the real estate positions, then the council can consider owners who do not live in our city.

Why anyone has a problem with this I do not understand. The property owners own a business here, pay property taxes here, the rent control laws apply to them, they should have equal rights to sit on the RHC, even thou they are a minority in numbers on the committee, as per Measure V.





45 people like this
Posted by Randy Guelph
a resident of Cuernavaca
on Nov 13, 2019 at 6:40 pm

Under Measure V, those seats do not belong to real estate people, that is just the most members of those professions that are allowed to serve. If we have more non-real-estate professionals dedicated to upholding the law, there should be no real estate professionals on the RHC. 2 is a ceiling, not a floor.

People have a problem with this because City Council wants to allow wealthy outside interests to directly legislate in our city at the expense of actual residents. These landlords would rather live in Woodside than be sullied by living near the people enriching them. If you can't even find two landlords in our city, there are plenty of actual residents who can do the job.


77 people like this
Posted by @Randy G.
a resident of Blossom Valley
on Nov 13, 2019 at 9:29 pm

Thank you for proving my point.

[Portion removed due to disrespectful comment or offensive language]

The majority of rental properties in our city belong to Mom & Pop families, you are telling them what they can and can not do with their business, including, telling them to shut up and just provide housing to the community, no matter what and you have no say in anything.

How big of you. You will never put your own money in your mouth to provide housing to anyone in the city.



24 people like this
Posted by Randy Guelph
a resident of Cuernavaca
on Nov 13, 2019 at 10:18 pm

[Post removed due to disrespectful comment or offensive language]


14 people like this
Posted by Gary
a resident of Sylvan Park
on Nov 14, 2019 at 12:48 pm

Gary is a registered user.

In response to the above comment from the landlord rights advocate, the landlords and former City Councilmember John Inks were quite right to use the initiative process to propose amendments to - or the repeal of - Measure V. However, because their measure is a "sneaky repeal" and was circulated by some who lied about it, the landlord's petition, I will call it, could be challenged in court under a statute and appelate court case I have cited. Meanwhile, the 5 pro-landlord or anti-rent control City Councilmembers have voted to put their proposed amendments to Measure V on the ballot in March. Most likely, landlord rights advocates communicated behind the scenes with some or all of those 5 cpuncilmembers about the new game plan to undermine rent control. Before Tuesday night, the Council had spoken only of proposing a second measure - not on a separate ballot. But we can understand that landlords like this scheme better: undermine Measure V in March and finish it off with the landlord initiative in November.


20 people like this
Posted by Alex M
a resident of Willowgate
on Nov 14, 2019 at 2:54 pm

Alex M is a registered user.

Tying rent increases to the Consumer Price Index is stupid, because a landlord's costs (maintenance, repairs, improvements, taxes, insurance) are not tied to CPI. Setting the rent increase cap at a fixed amount (4% or whatever) is also stupid because a landlord's costs are also not fixed. If you're going to cap rent increases, then tie it to a realistic index.


10 people like this
Posted by Dan Waylonis
a resident of Jackson Park
on Nov 14, 2019 at 3:12 pm

Dan Waylonis is a registered user.

It's meddling in the market that no one will benefit from. Just repeal the whole thing and instead, focus on removing any local regulatory burdens that inhibit developers from building housing in Mountain View.


8 people like this
Posted by Old Mtn View
a resident of Old Mountain View
on Nov 14, 2019 at 3:58 pm

It seems like a not crazy compromise.

This is what local politics is all about.

Do I think the majority of people here who are renters should be able to decide if landlords can recover their money? No. It’s just expensive to build a home or rent here.

That’s why these big old apartment complexes are going away and they will disappear a little bit more slowly if people can charge what the market rate is instead of selling off to an out of town developer.

In summary, probably a compromise that will please people in the middle and not those way on either side.


15 people like this
Posted by Mike
a resident of Rengstorff Park
on Nov 14, 2019 at 4:26 pm

Instead of wasting all the time and money that has been spent on this issue can the town please focus on the real issue at hand - Making housing more affordable for the people that really need the help and that benefit Mountain View by being here!

Passing laws to help one group while hurting another is problematic and invites opposition and fighting. Measure V fixed one problem and then created 10 more.

Why not create some criteria in order for renters who really need the help to be eligible for assistance (something like a gov run section 8 housing assistance). Criteria should include:
- Being below a certain household income level.
- Working in or needing to be in Mountain View etc....

Since a program like this would really benefit all Mountain View residents, it could be funded through our taxes out of the general fund and not just burden a small group of rental owners.

I am a renter myself and I am in the tech industry, I don't want to buy a home right now so I rent. I make plenty of money and really don't need the help with rent control. I personally know many people just like me in the same boat and we all laugh at just how narrow minded our city officials have become. My landlord use to keep my apartment in perfect shape and I loved living however since rent control, nothing gets fixed and our whole complex looks like a dump these days. I wish our elected officials would stop wasting all our tax money on fighting over this failed policy, abolish Measure V, let free market work as it has worked in every other industry and just concentrate helping those that really need the help.


41 people like this
Posted by Gladys
a resident of Old Mountain View
on Nov 14, 2019 at 5:35 pm

I will be voting yes on this ballot measure in March, and yes again on the second ballot measure in November 2020.

I wish to end this divisiveness over Measure V in our city. Vote yes for both and pass them, then we would fall under the States new rent control law that will start in January 2020.


13 people like this
Posted by Homeowner
a resident of Sylvan Park
on Nov 14, 2019 at 5:55 pm

I’m for building more condos/townhouses/homes to increase percent of homeowners in the city. Rent control can help with getting rid of older apartments, which is good.


12 people like this
Posted by Randy Guelph
a resident of Cuernavaca
on Nov 14, 2019 at 6:09 pm

Gladys, we already fall under the state rent control law. You've fallen for the lies being spread by the CAA and landlords. Please don't further spread misinformation.


10 people like this
Posted by Mountain View Neighbor
a resident of North Whisman
on Nov 14, 2019 at 6:12 pm

Mountain View Neighbor is a registered user.

The city of Mountain View has become communist. They have implemented rent control of allowable increases of about 3.5% annually, while utilities increase 8-10%. Utilities are of the more stable expenses. Labor and repair costs have increased astronomically.

The rent control of measure V is not sustainable. To think this rent control is sustainable is utterly delusional. It forces small and lower priced landlords out of the market. But no one cares that these are small businesses being driven out, replaced by high cost dense housing, built by foreign developers and investors. City, you’ve gone mad.

Blame it on the greedy landlords. Right on! But it seems no one has any decent economic sense or even the common sense to listen to those who do. We’re a bunch of little kids, bullying each other and taking toys that aren’t ours because we can.


15 people like this
Posted by Ok
a resident of Stierlin Estates
on Nov 14, 2019 at 6:24 pm

O K Boomers


10 people like this
Posted by Lyn
a resident of Shoreline West
on Nov 15, 2019 at 10:21 am

Once again, the City Council is trying to sabotage the rent control that the people voted for in 2016. This is like a smack in the face. There is no proof that raising rents would stop the landlords from evicting tenants and selling their properties. I am also disgusted that the City Council voted down mobile homes ability to have rent control. This City Council does not care about the people struggling to live in this city. I will do all I can to fight this awful City Council.


18 people like this
Posted by Yimby #2
a resident of Another Mountain View Neighborhood
on Nov 15, 2019 at 1:14 pm

The rent control cap based CPI does not make sense:

Measure V gives you 3.5% 2019, but at the same time take
excludes direct costs and bases the benefit on an unrepresentative proxy (CPI)

* Excludes increases in direct costs such as
- Water/garbage/sewer which have increased twice 2 two years
- Measure V fees, which are borne solely by housing providers
In other cities it is shared among the entire population
- Property taxes
- Property Insurance

* CPI does not tracks increases in costs directly related to housing
- Example: Electricians rates have gone way up.
- Replaced 50 amp/220 volt service, where it is better to use a professional
- Rates doubled after the first wildfires
- My neighbors had similar observations

Think about this: AB 1482 calls for a combination of the cost of living increase *plus* 5% or 10%, which is lower. What do you think they understand at the State Level that they don't understand at the local level.

There in a provision in Measure V which calls for housing providers to
absorb costs of inflation above 5%. Who creates one-sided provisions like that?


Changing subject:

* There is something wrong when there is a debate that requires housing providers to spend money without means for cost recovery. The most prominent is Seismic retrofits.

But pile all this on the maintenance of painting and replacement of roofs, sewer pipes, water pipes, electrical systems in older buildings.

To close, it is good that there are reform efforts to Measure V. As it now stands,
the numbers don't add up. And direct expenses are being excluded for political reasons.









* CPI tracks a basket of consumer good, and not direct costs of housing
- Aren't you skeptical of guidance from government telling us inflation is
low?


6 people like this
Posted by The Business Man
a resident of Another Mountain View Neighborhood
on Nov 16, 2019 at 6:54 am

The Business Man is a registered user.

In response to Yimby #2 you said”

”The rent control cap based CPI does not make sense:

Measure V gives you 3.5% 2019, but at the same time take excludes direct costs and bases the benefit on an unrepresentative proxy (CPI)

* Excludes increases in direct costs such as
- Water/garbage/sewer which have increased twice 2 two years
- Measure V fees, which are borne solely by housing providers
In other cities it is shared among the entire population
- Property taxes
- Property Insurance”

I love your attempt to rename a landlord a “housing provider”. Such political nonsense. As far as “speculative investors” into the housing market, it is not the tenants or the cities responsibility to guarantee a profit if these people do not understand the costs of doing their business. You are trying to socialize private profits that is not the way the market works. You said:

“* CPI does not tracks increases in costs directly related to housing
- Example: Electricians rates have gone way up.
- Replaced 50 amp/220 volt service, where it is better to use a professional
- Rates doubled after the first wildfires
- My neighbors had similar observations”

That was the risk of operating the business. The investors surely should have known that this was always a cost. The fact is this is not relevant to the discussion. Simply put there is never any process where an investor can impose on the customer the unanticipated costs. If this has happened in the past, it does not mean it was correct. The fact was that many “investors” borrowed large sums of money based on “promises” made by real estate agents. Realtors are not investment agents and are not restricted to providing an accurate market value when selling a property. The “investor” has the responsibility to ensure they do not overspend or over borrow on an investment. You know that. You said:

“Think about this: AB 1482 calls for a combination of the cost of living increase *plus* 5% or 10%, which is lower. What do you think they understand at the State Level that they don't understand at the local level.”

That was not understanding, it was lobbying. The real estate industry used millions of dollars to influence the legislation. That is well documented in the history of AB 1482. The lobbyists only made claims that cannot be scientifically validated because economics is not a natural science but a social one. There cannot be a scientifically proven cause and effect in social sciences. And when they use skewed economics studies not disclosing the conflicts of interest which is required now under the American Economists Associations requirements, those reports should be disregarded in total. You said:

“There in a provision in Measure V which calls for housing providers to absorb costs of inflation above 5%. Who creates one-sided provisions like that?”

There you go again trying to redefine what a LANDLORD is. Also for years the process was in fact only one-sided prior to the CSFRA. This process allows for a landlord to petition for a rent increase.

But in one case petition where a landlord got a small increase in rent, the hearing officer was not presented with the fact that rents were increased without approval when a landlord imposed a late fee. Late fees in apartments are illegal in the state of California under Orozco v. Casimiro [(2004) 121 Cal.App.4th Supp. 7], the Court of Appeal held that late fees under a residential lease are liquidated damages within the meaning of Section 1671(d), and declared them to be void except under extraordinary circumstances when it would be impracticable or extremely difficult to fix the actual damage. When my landlord collected $700 in late fees during the petition process, he violated the CSFRA as it states here:

Section 1710. - Petitions for individual rent adjustment—bases.

A Landlord or a Tenant may file a Petition with the Committee seeking adjustment, either upward or downward, of the Rent for any given tenancy in accordance with the standards set forth in this Section, and using the procedures set forth in Section 1711 herein and implementing regulations. A Petition shall be on a form provided by the Committee and, if made by the Landlord, shall include a declaration by the Landlord that the Rental Unit complies with all requirements of this Article.

(a)Petition for Upward Adjustment—Fair Rate of Return: To effectuate the purposes of this Article and the requirements of law, a Landlord may file a Petition for an upward adjustment of the Rent to ensure a fair and reasonable rate of return. It is the intent of this Article that individual upward adjustments in Rent be granted only when the Landlord demonstrates that such adjustments are necessary to provide the Landlord with a fair rate of return. The Committee shall promulgate regulations to further govern Petitions filed pursuant to this Subsection in accordance with law and the purposes of this Article.(1)

Prerequisites. No upward adjustment of Rent shall be authorized by a Hearing Officer or the Committee under this Subsection if the Landlord:(A)HAS CONTINUED TO FAIL TO COMPLY, AFTER ORDER OF THE COMMITTEE OR OTHER AUTHORITY, WITH ANY PROVISIONS OF THIS ARTICLE OR ORDERS OR REGULATIONS ISSUED THEREUNDER; or(B)Has failed to maintain the Rental Unit in compliance with Civil Code Sections 1941.1 et seq. and Health and Safety Code Sections 17920.3 and 17920.10.

However the CSFRA has the following section:

Section 1706. - Stabilization of rents.

(a)Rents Stabilized. Upon the effective date of this Article, NO LANDLORD SHALL CHARGE RENT IN AN AMOUNT THAT EXCEEDS THE SUM OF THE BASE RENT PLUS ANY LAWFUL RENT INCREASES ACTUALLY IMPLEMENTED PURSUANT TO THIS ARTICLE.

(b)Rent Increases Regulated. NO LANDLORD SHALL INCREASE RENT FOR A COVERED RENTAL UNIT EXCEPT AS AUTHORIZED BY THIS ARTICLE. RENT INCREASES SHALL BE LIMITED TO THOSE IMPOSED PURSUANT TO SECTION 1707 (ANNUAL GENERAL ADJUSTMENT) AND SECTION 1710(A) (PETITION FOR UPWARD ADJUSTMENT—FAIR RATE OF RETURN). A Landlord may set the initial Rent for a new tenancy pursuant to Section 1708 (Initial Rents for New Tenancies).

(c)Security Deposit at Commencement of Tenancy Only. No Landlord shall increase a security or other deposit originally required from a Tenant as a condition of occupancy of a Rental Unit. You finally said:

“Changing subject:

* There is something wrong when there is a debate that requires housing providers to spend money without means for cost recovery. The most prominent is Seismic retrofits.”

Again, you try to redfine the LANDLORDS by using the term “housing providers”. Most “providers” in Mountain View have bought the properties after they were build. Thus you did not “provide” housing at all. You just expected that by “owning” the property you are a “provider”. Only where you actually built the housing can you define yourself as a “housing provider”

In the housing market, there never was any guaranty of cost recovery for anything. Why are you imposing that on the market when it in fact is fiction? The for-profit market is allowed to make as much money in profit where good business decisions provide that result. But where investors over spend for an investment and the investor doesn’t use resources to prevent the action, the tenants nor the public are responsible for that mistake. The investor has the moral hazard of experiencing a loss based on poor research regarding the potential outcomes of the action.


2 people like this
Posted by The Business Man
a resident of Another Mountain View Neighborhood
on Nov 18, 2019 at 1:25 am

The Business Man is a registered user.

What?

No response from anyone?


2 people like this
Posted by Gary
a resident of Sylvan Park
on Nov 18, 2019 at 11:45 am

Gary is a registered user.

About the apparent con-job by some City Councilmembers that if their measure were approved on March 3, the proponents of the landlords' "sneaky repeal" might very well withdraw their initiative, see California Elections Code section 9604. It appears the local initiative cannot be withdrawn "after filing." Filing and certification (the signature count) occurred in 2018. The landlords' "sneaky repeal" is headed for the November ballot - regardless of the outcome on March 3.


Like this comment
Posted by jack
a resident of Shoreline West
on Nov 18, 2019 at 4:03 pm

jack is a registered user.

We can not count on this council to protect residents. Vote no in march and no in November.


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