To the Los Angeles Journal:
What’s most disturbing is that the City Council and others passed a “moratorium” which restricts and prevents landlords from imposing the annual, rental-mandated, municipal rent increase. Under the Rent Stabilization Ordinance, the tenants’ rent may be lawfully increased each year based upon the Consumer Price Index. There’s a ceiling of 9% and a floor of 3%. But what hasn’t been taken into consideration is that there are some incredibly wealthy tenants who don’t require or need the “restriction/moratorium.
Some Tenants Don’t Need Help
Do you believe that the tenants who live in Pacific Palisades, Brentwood, Westwood, Toluca Lake, Rancho Park, Cheviot Hills, Bel Air, Sherman Oaks, Encino, Mar Vista, Playa del Rey, Westchester and Playa Vista – making several hundred thousand dollars per year in high-tech industries or working for a major motion picture studio, or possibly being high-priced attorneys and/or physicians – need or require a “suspension” of the annual increase which is merely 3%? A mere 3%.
Expenses Have Increased!
And landlord expenses have increased. The cost of trash hauling has gone up 400%. Water and sewage have probably gone up 20% per year. If you need to buy a garbage disposal, it’s probably gone up 300%. Refrigerators, ranges and microwaves have all gone up perhaps 300%. A hot water heater has gone up 400% or more!
And these tenants are living without paying their rent! (Remember, there’s a moratorium on evictions.) Yet, every day, they have a demand or list of items they want handled in their units – maybe pest control, re-landscaping the common area, decreasing the cost of the washer and dryer units in the laundry room; the installation of a new roof; possibly installing new mini-blinds, new laminate or hardwood floors, new appliances, new window screens, new windows and locks. The list is endless.
On the one hand, the tenants are not paying their rent. On the other hand, every day, they have a list of items they demand be handled. Is that fair?
Harm and Injustice
You see, if a tenant has a legitimate “financial hardship”, they should be able to apply to the Housing Department for relief. However, incredibly smart, sophisticated and intelligent renters are given a moratorium? Your staff should have researched AB 1482 which mandates an automatic increase every year. This is a State law that preempts the City law. AB 3088 preempts the City law.
So, maybe if the tenants agree to pay 25% of the outstanding rent as required by AB 3088 and the Housing Department relaxes the pressure on installing luxury items during the moratorium, there might be some fairness on the judicial landscape.
Yes, the judge ruled correctly because there was no evidence of irreparable harm. But there is real harm and real injustice. When this case proceeds to trial, there is evidence that these tenants will never be able to show a single incidence where a tenant is living on the street in a homeless encampment because the rent was increased by a factor of 2% or 3%.
Be careful. Do the research.
To David Chiu, Other Assembly Members and Governor Newsom
RE: Vote No on Rent Postponement
Real estate developers, builders and the apartment industry strongly oppose Assembly Member Chiu’s recent Bill which would extend AB 3088 to December 31, 2021. It’s not fair.
Since march 2020, many tenants have simply not paid rent due to local moratoria. Most provide that when the Coronavirus episode is resolved, the tenants have a term of 12 months thereafter to pay their back rent. The postponement of rent is indeed a “back door” attempt to forgive or otherwise cancel rent. So, is this fair?
In Los Angeles, there are extremely high vacancy factors. Tenants working for major Fortune 500 corporations and others have been told not to come back to work but to do their jobs remotely from home. They are still getting paid.
They’ve surrendered and left their rental unit. They’ve gone home to Fontana, San Bernardino, Orange County, San Jose or other remote locations where the rent at home is free. Then, of course, other tenants have also left – thus the high vacancy factor. In some situations, there are a number of tenants who have simply decided not to pay rent. After all, they are protected. And now you want to extend protections to the end of 2021?
Let’s revisit the deal. In 2019, David Chiu agreed that comprehensive rent control would be his bill – AB 1482. We all agreed. Now, he wants to betray his promise. He wants to put AB 1482 on the shelf and he’d like to see Proposition 21, which was defeated, pass.
HARDSHIP: Small apartment owners still have to pay for water, sewage, trash, parcel taxes, bonds, insurance, property taxes, repairs and restoration for electrical, roofs and plumbing. They have to buy appliances, fix windows, locks and doors; replace the roof or maybe even do earthquake retrofit and restore balconies and stairs.
Imagine that you own an eight-unit building. It’s serviced by a 100-gallon quick-recovery water heater. The water heater breaks and needs to be replaced. The cost for that is $10,000. Who pays for that?
If you have to repair a roof, well, that may cost you $5,000. If the tenants are careless and bring inappropriate food into the units and its overrun by roaches, ants or vermin, the owner needs to employ a pest control service. Who pays for that?
So, any extension of the postponement of rent is going to need a mechanism where the tenants, each and every month, pay one-third directly to the owner. They should also pay half of the cost of property taxes, insurance and registration fees; half the cost for earthquake retrofit, balconies and stair construction. If there’s a dispute, they can go to Small Claims Court; however, both parties must have the absolute right of appeal.
We need the Governor and others to fully appreciate and understand that postponement of rent is an unconstitutional “taking” of property, without due process and compensation. It’s illegal.
Oh, and by the way … the CPI formula is illegitimate as well.
Michael Millman is an Attorney and a Mar Vista activist and can be reached at (310) 477-1201.