This article was posted on Saturday, Jul 01, 2023

The below is an email that was sent to the Burbank City Council members by John M. Gerro of Gerro and Gerro, Attorneys at Law in regards to “the direction of Burbank regarding an appropriate stand for property rights and the economic impact of proposed ordinances, statues, rules and other property regulations that may be forthcoming, either through the city council, county supervisors or state legislators.”

John told us “There is a strong and organized movement to implement more regulations or even a rent control ordinance if we do not oppose or at least moderate the pending situation.”


To the  Councilmembers:

By identifying this concept as “tenant protection”, it is actually misleading to the public and tenants as it is adverse to renters. Recently, the issue of rent control was presented to the residents of Burbank in 2020 and the vote was 63% against the measure. Now the same concept is potentially geared to circumvent the vote. If so, this would be an attempt by the city council in contravention of the voice of the people. To defy the voice of your constituents is simply wrong. The people have clearly spoken.

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With regard to RC20, reasonable minds have rejected the proposed rent control measure. Tamala Takahashi said she would vote ‘no’ and suggested creating more housing. Nick Shultz said he would vote ’no’ due to the substantial cost and also yielding unregulated power to a board. Zizette Mullins has expressed an alternative by emphasizing education of the existing state housing laws.


Rent Control Doesn’t Work!

Historically, this concept has been an utter failure in every city, state and even other countries. For instance, in Sweden, the rent control system failed. Those tenants that were awarded the housing contracts illegally sublet to secondary tenants on the black market. Many units were overcrowded. Once tenants obtained the rental controlled unit, they rarely relinquished them, thereby limiting the availability of housing for new tenants. It was nearly impossible for any newcomers to the city to get a controlled unit. Vacant, decontrolled units were forced to charge more due to the lack of supply, thereby resulting in a wide disparity of rent for similar units. 

What results is one class of people gaining an advantage over other classes of people. This is not only discriminatory but not a recipe for social harmony. 

This also results in falling mobility which feeds into difficulties for employers which is a major impediment to hiring workers to grow their workforce. Burbank has and also attracts large corporate businesses with many thousands of employees who need housing. Over the past years, council members and staff have not been in favor of rent control. We have survived the impact of the covid pandemic and have a strong economy. 

The further studies revealed that a price ceiling will produce a shortage of units and service provided. Where rent price ceilings are set below the fair market rates, property owners tend to leave the market, never enter the market in the first place, adjust other costs (such as maintenance and repair) downward so as to reduce losses or maintain their margins and be disincentivized to renovate existing housing. 

Be aware that the cost of operating apartment buildings and rental housing is substantially increasing. This includes all utilities, operational services, building supplies for repairs and replacements, labor, vendor accounts, management fees, franchise tax board annual fees, property taxes and other necessary expenses that are exceeding rent increases. Keep in mind that the city needs more affordable housing and any rent control ordinance would not provide housing – actually to the contrary!

Cities have experienced dysfunction brought about by rent control. The City Council of Los Angeles has hindered not only building and development but, with overly complicated and severe rental restrictions, is now forcing property owners to liquidate their properties and leave the state.

In contrast, Burbank is not a community that compares to LA. Property owners in our town respect their tenants, have long lasting relationships with their occupants, care about their properties with pride of ownership and maintain the structures and units. In return, a fair value is charged. One reason people want to move to Burbank is because properties are maintained. They prefer a higher standard because this is their home. Rent restrictions will cause depreciation and less maintenance. Burbank, in its goal to comply with state Regional Housing Needs Allocation, is presently experiencing a surge of new apartment construction coupled with affordable housing. This is a positive sign.

Please be reminded that there is statewide rent control (AB 1482) that is already in existence which provides in part for rental increase caps, just cause eviction and relocation allowances, among other tenant protections. Burbank has its own rental commission which assists in various issues and mediation. Education to the public can be expanded in this regard.


Consider Other Alternatives

There are also options and programs for the city to consider such as rent subsidies to those who qualify, seeking more state assistance for affordable housing, using federal vouchers, purchasing apartment buildings and allocating units at a reduced rental rate. They are working with developers through development agreements to build more housing, encouraging workforce housing for incoming businesses, ease the requirements of processing building permits in the planning department, ease the zoning requirements for building, facilitating ADUs, micro housing, duplexes and triplexes, mixed use buildings, transit oriented solutions and other alternatives at your immediate disposal.


Worth the Cost?  No!

Implementing an additional rent control ordinance will require expanding bureaucracy, enforcement and substantial funding. Just the initial city start-up contribution from the general fund can exceed a few million dollars from taxpayer money. Any autonomous rent control board will be difficult to control, requiring supervisorial monitoring, funding monetary deficiencies, lack adequate reporting to the city council, place demands on the city attorney in litigation matters, hiring outside counsel without prior approval and other infringements and violations to the city charter.


More Negative Effects of Rent Control

A rent control ordinance would further amount to a usurpation of private property rights, unnecessary supervision and administration of housing availability, more regulation over property, diminution of the local housing stock, and a violation of various elements of the city charter, among other detrimental aspects.