Decision Time on Rent Control for Santa Rosa City Council

Saturday, April 30, 2016
Kevin McCallum
Santa Rosa Press Democrat

After studying the idea for months, Santa Rosa appears poised to take its first definitive step toward imposing rent control, a controversial move supporters hope will protect residents from soaring rents but which landlords say will be “disastrous” unless overturned at the ballot box.

A sharply divided City Council on Tuesday will decide for the first time whether to tell staff to begin drafting a program that would set an annual cap on rent increases for apartments built before 1995, and if so, what that cap should be.

It’s also expected to consider a companion law aimed at protecting all renters in the city from unfair evictions, as well as an immediate moratorium on rent increases until the city drafts and passes any ordinance.

“This is an important meeting,” said Assistant City Manager Chuck Regalia. “This is the first time the council has the opportunity to take what they have learned and take action on the subject.”

It’s also likely to be a circus, with a huge turnout, passionate public commentary and boisterous demonstrations outside the council chambers.

The influential real estate community, spurred by a recent mailer denouncing the proposal, is expected to show up in force, as it has for many of the council’s study sessions over the past year.

Santa Rosa Junior College students, who say high rents are impairing their ability to get a good education, plan to march from campus to City Hall. And the North Bay Organizing Project is vowing to hold a rally outside the chambers complete with marching band.

“This is the simplest thing the city can do to protect the middle class and the workers from exploitative rent increases,” said Davin Cardenas, lead organizer with the North Bay Organizing Project.

Cardenas said he’s planning to urge the council to adopt a “robust policy” that protects tenants “because it’s going to be challenged at the ballot box anyway.”

Daniel Sanchez, director of government affairs for the North Bay Association of Realtors, predicted rent control would have the opposite effect of what supporters intend.

The likely result is that some landlords would get out of the rental business, reducing the number of rental units on the market at the time they’re needed most, he said.

A mailer the group sent out recently depicted a house key wrapped in red tape and warned “Santa Rosa Housing Providers: Staying in the Rental Business Could Become Impossible.”

The mailers claimed rent control doesn’t create any more housing, won’t bring down rents, and is “unfair and will cost the city millions of dollars annually.” It also attacks the companion protections for renters, known as a “just-cause for eviction” ordinance, that will also be considered by the council.

While rent control by state law can only cover rental apartments built before 1995, such renter protections typically cover all rental units, regardless of construction date. This includes single-family homes.

The flier claims that under such an ordinance, “removing problem residents and protecting innocent residents is impossible and expensive.”

Typically, just-cause for eviction ordinances only allow landlords to evict tenants for specific reasons, such as failure to pay rent, violating a term of the lease, creating a nuisance, or if a landlord or member of their family intends to move into the unit.

Who would decide when such evictions are justified is one of the questions before the council. The city could enforce the rules through a housing board or require renters to get relief in the courts. The idea that landlords might have to justify their evictions to a local board or court is one of the key reasons the policy is being painted as creating a new, unnecessary bureaucracy.

However the city structures the law, if it entails a cap on rents it will be opposed, Sanchez said.

“We’re going to use every option available to prevent rent control from being instituted in Santa Rosa,” Sanchez said.

He pointed to the case of Richmond, which passed rent control — often referred to as rent stabilization — and just-cause eviction last year only to have a real estate industry-funded petition drive block the law from going into effect.

The law would have tied rent increases to inflation. A group is pushing to place the issue before Richmond voters in November.

A large number of SRJC students are expected to participate in Tuesday’s march, said Scott Rossi, the student trustee at the college.

Rossi, a 36-year-old English and anthropology major, estimated there are 1,200 students who are homeless because they can’t afford the area’s soaring rents.

“Once or twice a week, a student will contact me because they are homeless or facing eviction,” Rossi said, noting he has nowhere to point them.

He’s experiencing the problem firsthand.

After his own rent in Rohnert Park rose 10 percent each of the past two years, it’s set to jump 23 percent June 1, from $1,440 to $1,775 a month, following the sale of his building to a new owner, he said. It’s forcing him to move out of state, he said.

Tuesday’s decision follows a pivotal 2-1 vote by a council subcommittee in March recommending the council pursue what it termed “limited” rent control.

This involves limited city staff because the rents of individual units aren’t tracked, according to a report commissioned by the city. Instead, the city would set a maximum percentage that rents could go up annually, and landlords would have to inform their tenants of the policy and abide by it. Enforcement or mediation would fall to a rent control board or a nonprofit organization.

What that percentage would be is entirely up to the council. Some of the 12 cities in California with rent control peg the increase to inflation, often as a percentage of the Consumer Price Index. But Councilman Chris Coursey, a subcommittee member seen as a swing vote on the issue, said he thinks a set annual percentage would offer predictability.

The report by consulting firm Management Partners noted that Hayward has a limited rent control program and restricts its annual increases to a maximum of 5 percent.

The average Sonoma County renter was paying $1,652 per month in 2015, according to RealFacts. A 5 percent increase translates to $83 more per month, or $1,735.

Rents in the city have increased 37 percent in the past four years, according to RealFacts. And average rents have only continued to climb in 2016, according to Walter Kieser, the consultant working with the city to study ways to boost housing production.

Those higher rents are having a direct impact on thousands of people’s lives, said Ronit Rubinoff, executive director of Sonoma County Legal Aid.

Of the 600 evictions her office has handled during the past year, 90 percent were for not paying their rent, usually after it was raised sharply, she said.

Innumerable others don’t even bother to seek legal help in such instances, she said.

“There is this great sense of hopelessness out there,” she said.

Other than setting the annual cap, the council has a number of other issues to iron out Tuesday. These include who will make up the rent board? The City Council itself, the existing housing authority board, or something new?

When would the ordinance sunset? The subcommittee recommended it go away if vacancy rates hit 5 percent.

And what types of units should be covered? Duplexes, triplexes, fourplexes? Depending on what types are included, the city has estimated that as many as 13,386 units could be subject to rent control.

Comments by council members to date suggest that Mayor John Sawyer, Ernesto Olivares and Tom Schwedhelm are against any kind of rent control, worrying about its fairness and preferring to find ways the city can boost the supply of new units.

Coursey, Julie Combs, Erin Carlstrom and Gary Wysocky have all expressed conditional support for rent control, pending additional details.

Wysocky said he understands his colleagues’ desire to boost housing production, and shares those views.

“I would hope it’s not an either-or,” Wysocky said.

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