The below open letter was sent to Mayor Garcetti and City Council members.
OPPOSE Ballot Measure Affordable Housing Act!
I believe there’s a great deal of misinformation pertaining to our Rent Stabilization Ordinance (FSO) and the impact of the repeal of the 1995 Costa-Hawkins Fair Housing Act. We should all meet.
Let’s start at the beginning. Los Angeles, unlike other rent control jurisdictions, has a more progressive and liberal approach to rental housing. Los Angeles has many “features” which promote and encourage the development and investment in rental income housing.
When a unit becomes vacant, it is offered for rent at the prevailing market rates. New construction, condominiums, granny flats and single family homes are, indeed, exempt. An authorized roommate is permissible however, the rent is increased by a factor of 10%. The annual rental adjustment can be as high as 5% wherein the owner pays for natural gas and electricity.
Thousands of units have been built with the understanding that there will be no “restriction” or limitation on rents. An attempt to retroactively remove those “protections” would, indeed, result in extensive litigation.
There are 620,000 rental units currently under the jurisdiction of the RSO. These units encounter a very difficult time challenging or competing against newly constructed/luxury units. We need to offer and provide every possible, lawful advantage to the older units to “compete”. Again, making rent control more difficult would be inappropriate.
Simply stated, rents will not go down. Rents will stay at the current rate and will be increased based upon an annual rental adjustment. Tenants to pay water, sewage, trash and all municipal fees. SCEP inspections to be eliminated other than when complaint driven. It costs $30,000 a year to run the inspection program. Take that money do City rescue/emergency vouchers for rent-burdened tenants.
In any event, that’s my belief and feeling, which the Realtors, developer, trade unions and the apartment industry will probably embrace and endorse. Very truly yours.
The below letter was written to Herb Wesson, President of the Los Angeles City Council.
Dear President Wesson:
As you will agree, over the last nine months or longer, many of our friends, (tenant activists), have been offering a “false narrative” to support some type of statewide initiative to repeal the Costa-Hawkins rental housing act and promote the oppressive and very strict type of rent control found in Berkeley, West Hollywood and Santa Monica.
As a leader in our community, I am hopeful that you will be a proponent for a “fair and reasonable” solution to the housing crisis. We cannot build our way out of the crisis.
We need to examine creative and innovative approaches. First, there are approximately 5,000 rental units that have been “locked down”, alleging that they were built without a proper permit. We need a workable amnesty for bootlegged units.
Next, we need to streamline the process for obtaining and building assessor dwelling units, (ADUs). Waive parking, and expedite the process for separate or sub-meters.
Over the last 15 years, the Federal Program Section 8 has been a disaster. The protocols will not let the owners opt out with reasonable notice. The program can withhold the payment of rent as a tool to abate a habitability issue. The rental threshold amounts are far too low.
We should develop our own voucher program, underwritten by some of the money for the homeless programs, some additional discretionary money through the County and some from the Mayor’s budget. A legitimate financial hardship person should be able to obtain a rent voucher from the City or the County. They should never lose their apartment.
Rent Control Kills Housing
Thirty-nine years ago, whenL.A.Cityadopted the Rent Stabilization Ordinance, there were approximately 1,300,000 rental units. Today, there are less than 600,000. Many have been abused and terrorized by the code inspection program, the rent escrow account program, (REAP) and the failure to provide profitable protocols to many small family rent groups. We need to support these outstanding families.
I believe you should convene a summit with The Apartment Owners Association of California, Inc., (AOA), other apartment associations and some of the leading tenant groups. Let’s negotiate a compromise and help “rent-burdened” tenants. Let’s set a system of apartment management by working together. Instead of complaining about the problem, let’s develop fair and appropriate solutions. Please contact me. Michael Millman, Esq.
The below letter was written to Jeff Collins of the Daily News.
Thank you for your excellent article. It’s my understanding that you generally examine, evaluate and offer comments and opinions concerningOrangeCountyreal estate and I believe your home or office is probably inOrangeCounty. In any event, I compliment you on the article.
Let’s start at the beginning. Santa Monica and Los Angeles have had “just cause” evictions for well over 20 years or longer. People are still evicted however; it is much more complex, difficult and expensive.
60-Day Notice to Terminate
In non-rent control jurisdictions, an owner may simply serve a notification on the tenant to terminate their arrangement at the expiration of 60 days. Very simple. There is no legal defense. None.
The Judge makes a determination as to whether or not the notice was properly prepared and properly delivered or served. If he finds those two elements to be legally sufficient, he thereafter, grants a judgment in favor of the landlord. Simple. And it is so simple that the eviction attorneys charge very modest fees or no money at all.
On the other hand, under the “Just Cause” evictions, there are 12 enumerated bases for possibly removing a tenant. Whether the 12 items are complicated or simple is really not the question.
True Picture of “Just Cause” Evictions
If you allege that a tenant has failed repeatedly to pay their rent and proceed with an eviction action, you will undoubtedly receive a tenant’s response wherein it’s alleged that the rental premises were either in declining condition or otherwise deteriorated. This is called the “habitability defense”.
Next, the tenant’s attorneys demand a jury trial and because of the lack of courtrooms and staff, those cases are generally continued for approximately three to five months. All during this time, the tenant is living rent-free. That’s right – the tenant is paying no rent and probably causing waste or damage to the premises. If you interview a dozen or more eviction lawyers, they will all tell you stories about tenants who retaliate by pouring liquid or quick-set cement down the toilets. The tenant systematically goes through the rental unit and punches holes in walls, tears up the carpet and does other forms of insidious destruction and waste.
Eventually, the tenant leaves after the eviction lawyers negotiate EXTORTION allowing the tenant to live there five months rent-free. They agree that the settlement will remain private and confidential, instructing the Court Clerk to “conceal” or otherwise, seal all of the court’s records. The deadbeat tenant now has no record of eviction. The lawyers, of course, receive a fee of $10,000 for making the “deal”. THIS …. Is a true picture of “just cause” evictions!
Royal Apartment – Anaheim
Yes, you’re correct. For 20 years or longer, the original owners probably didn’t give annual rent adjustments or increases. The units were incredibly cheap. Yes, the rents were must less than existing or comparative market rates.So, the tenants never moved. They simply resided and bought new motor vehicles, flat screen TVs, and large, compact laptop computers and had a very good life because the landlord kept the rents artificially low.
The property was sold. The new owners decided that it was time to remodel and restore the units. I believe you indicated they had budgeted over $1,000,000 for this project. So, they had to increase the rents.
You would agree that under Proposition 13 when properties are sold, they are immediately reassessed at prevailing market rates and thereafter, the property taxes go up. Therefore, if you factor in property taxes, bonds, parcel taxes, insurance and deferred maintenance, the rental increases seem fair, appropriate and reasonable.
Solution – Rental Vouchers
OrangeCountyor several cities should pull some of their resources together and recognize they cannot “build” themselves out of the housing crisis. Simply prepare rental vouchers where the affected tenants could apply to the Housing Authority and be given vouchers whereby they could pay for the rental increases. Simple. Let the counties or cities underwrite or subsidize the increases. Yes, the tenants remain in the apartments and the County supports them not being displaced by gentrification tenant displacements. This is called a SOLUTION.
Super-large labor unions, cities, municipalities and of course, tenant activist groups have all failed to promote or encourage both industries and companies to develop and build work force housing.
Yes, our friends at Disneyland should have built several thousand rental units. Some of the prestigious community colleges or universities or major industries inOrangeCountyshould have built units for their workers and others. When you do the research, you’ll discover that “just cause” evictions are merely a “back door” effort to enrich a handful of tenant eviction attorneys who represent the tenants. Indeed, in Los Angeles, there is typically an assigned private attorney and the cost is paid for by the County budget. These attorneys, knowing they’re going to be paid on a per hour basis, naturally inflate their efforts and time so they can send an enormous statement, invoice or bill to the County claiming time on a case; they have no incentive to settle and thereby drag the case out longer! Do your research.
Lack of Housing
Knowing about these circumstances, landlords, when faced with a vacant unit, will generally only accept a tenant with a highly inflated credit rating – high 700s and low 800s. This is called the FICO score. Most working families and others sometimes have extremely low credit scores or other difficulties. They will not qualify. Eviction records, having been sealed pursuant to recent state legislation, make the “marginal” or very low-income tenant an impossible arrangement.
So do the research. I enjoy your column. Michael Millman, Esq.
Michael Millman is an Attorney and a Mar Vista activist and can be reached at (310) 477-1201.