A year after a group of Latino residents seeking relief from soaring housing costs in the Monument Boulevard neighborhood spurred a debate over rent control, city leaders have established a process for tenants to appeal large rent increases.
Under the rent review program, tenants of all buildings with three or more units who receive a rent increase of more than 10 percent in a 12-month period may seek mediation. If the landlord and tenant fail to reach agreement, either party may request a public hearing before a panel that will deliver a nonbinding decision.
The program may begin as soon as July.
“I feel confident that this mediation program is going to work,” said City Councilman Ron Leone, noting that he and Councilwoman Carlyn Obringer crafted the policy with the needs of tenants and landlords in mind.
But tenant advocates who have urged the council to pass rent control say the program lacks teeth, and that the threshold for appealing rent hikes is set too high.
“The rent review program is basically a waste of city money and resources because it’s nonbinding,” said Eduardo Torres, a regional organizer with Tenants Together, a statewide renters’ rights organization. “The program is not a real solution to Concord’s housing crisis.”
Landlords, however, believe mediation is a fair compromise.
“The very fact that the landlords are mandated to participate, otherwise they won’t get any increase, that really renders the procedure binding to me,” said Concord landlord John Sullivan.
The rent review program includes about 8,100 units in 450 separate Concord properties. Single-family homes, condominiums, townhomes, in-law units, mobile homes and affordable housing units are exempt.
Participation in the program is mandatory for landlords, who could raise rents just once in a 12-month period for tenants who have signed a lease. Property owners could raise the rent multiple times in a year if tenants choose to rent month-to-month rather than sign a lease. However, the same 10 percent cap would apply to avoid mediation.
In conjunction with a rent increase notice, landlords must notify tenants in English and Spanish of their right to file an appeal within 15 days.
First, the mediator has 10 days to reach a compromise via phone calls and email to the landlord and tenant, a process known as conciliation. If that fails, both parties meet with the mediator over a period of up to 30 days.
If mediation is unsuccessful, the landlord and tenant appear at a public hearing before an appointed panel with three members — a tenant, landlord and a neutral party — that issues a nonbinding decision. In evaluating whether the rent increase is reasonable, the panel may consider a number of factors, such as market rents for similar Concord apartments, recent maintenance or infrastructure expenses the landlord incurred and any reduction in services or amenities.
Tenants must pay rent during the review process. If the review is ongoing at the time the proposed rent increase was scheduled to go into effect, the tenant must pay base rent plus 10 percent. If the parties subsequently reach agreement on a lower rent, the landlord must refund or credit the difference to the tenant within seven days.
The city will charge landlords a $16 fee per unit to cover the estimated $100,000 to $150,000 annual cost of the rent review program. The ordinance does not prohibit property owners from passing this fee along to the tenants.
Councilman Tim McGallian said the city’s objective is ensuring that Concord residents have safe, affordable places to live.
“We’re not trying to price people out of the marketplace so we just have a revolving door of people moving in and out of our community,” he said.”But at the same time we understand you have to be able to make money in order to be able to support these housing units.”
Recent surveys show that Bay Area rents are falling slightly or remaining relatively stable. In Concord, the average rent increased by about 8 percent in 2016 compared to nearly 13 percent the previous year, according to data provided by the city. Slightly more than half the residents who have called the city’s rent-reporting hotline since January reported receiving an increase of 10 percent or more, including a dozen people whose rent went is going up by more than $300 per month.
Several council members pointed out that more than 700 apartments are either under construction or in the pipeline in downtown Concord, including a handful of units for very-low-income tenants. But McGallian, who owns out-of-state rental property, scoffed at the oft-repeated notion that simply building more housing will drive down rents.