A moratorium on what some are calling a loophole to Oakland’s rent control ordinances is being extended another six months as city officials figure out a permanent solution.
Before the moratorium, the exemption allowed landlords to raise rents after making repairs to their property.
City Council members voted Tuesday for the extension, which will go into effect after the original moratorium — passed in November — expires. It is scheduled for a final reading April 17.
The “substantial rehabilitation” exemption was adopted in 1980 to encourage landlords to improve rental units by allowing the owners to recover revenue lost from vacancies during renovations, according to a report supporting the moratorium. But some tenants are unable to afford the increased rent for their units after repairs are made.
The loophole has lead to the displacement of many longtime Oakland residents, especially in West Oakland, Councilwoman Lynette Gibson McElhaney said at the council meeting.
“There is enough money in the marketplace now to build on land that is vacant, even for people who want to take advantage of market rate rent. There’s many opportunities to grow and invest in this town without displacing our historic fabric or substantially rehabilitating our Victorians,” Gibson McElhaney said. “I am deeply concerned that this current provision is not only displacing tenants, I’ve even seen it used to the point where it’s changing the characters of neighbors by destroying historic facades.”
Councilman Dan Kalb, who proposed the moratorium with Councilwoman Rebecca Kaplan, said in an interview that city staff is “close to being done with a proposal or set of options” for either changing or getting rid of the exemption. He expects staff to have those options ready within the next two months.