Item 33 - Rent Stabilization Ordinance and Just Cause Eviction Ordinance

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Rent Stabilization Ordinance and Just Cause Eviction Ordinance September 21, 2021 Page 3 2 1 2 6 3. Authorize staff to reallocate Revive Santa Ana funding to create an Eviction Defense Fund, based on the model of the City’s Deportation Defense Fund. Following the direction from the Housing Ad Hoc Committee staff have drafted an ordinance adopting rent stabilization, a second ordinance adopting just cause eviction protections, a resolution, and a reallocation of Revive Santa Ana funding to create an Eviction Defense Fund as further described below. These two Ordinances are recommended by the Housing Ad Hoc Committee as an emergency measure to protect and preserve the health, safety, and welfare of the residents of the City of Santa Ana in response to the pending expiration of the State’s COVID-19 emergency residential eviction moratorium on September 30, 2021. Pursuant to the disclosure of the Mayor at the City Council meeting on September 7, 2021, the Housing Ad Hoc Committee would be reviewing policies to protect tenants before the end of the State’s eviction moratorium. The two Urgency Ordinances will become effective immediately if passed by the affirmative votes of at least two-thirds (2/3) of the members of the City Council. Rent Stabilization Ordinance The Housing Ad Hoc Committee recommends the adoption of an urgency rent stabilization ordinance prohibiting residential real property and mobilehome space rental increases that exceed three percent (3%) annually, or eighty percent (80%) of the change in Consumer Price Index, whichever is less, within the City (Exhibit 1 or 2). The term Consumer Price Index means, at the time of the adjustment calculation, the percentage increase in the United State Consumer Price Index (CPI) for all Urban Consumers in the Los Angeles-Long Beach-Anaheim Metropolitan Area published by the Bureau of Labor Statistics, not seasonally adjusted, for the most recent twelve (12) month period ending prior to the proposed rent increase/adjustment. Regarding the 80% of the percentage increase in CPI, this is equal to eighty percent (80%) of the percentage increase in the CPI (All Items, All Urban Consumers for Los Angeles-Long Beach- Anaheim, California area, or any successor designation of that index that may later be adopted by the U.S. Bureau of Labor Statistics). For example, if the percentage increase in the CPI for All Items were 2.5%, the final percentage would be calculated by multiplying 2.5% by 80%. The new amount equals 2%. The amount is then compared to 3% and a landlord may not increase their rent greater than the lower of the two percentages. In this example, the landlord would be prohibited from increasing their rent more than 2%. If the CPI is negative, no rent increase will be permitted. The Ordinance also prohibits more than one rent increase in any twelve (12) month period. A violation of the Ordinance occurs upon the service of notice or demand for a prohibited increase in rent. The rent stabilization cap will apply to buildings built in 1995 or earlier. The rent stabilization cap for mobilehomes will apply to those mobilehome parks established in 1990 or before—regardless of ownership. (A new mobilehome park name/owner will not be a loophole to the rent stabilization ordinance.) Mobilehome parks comprise approximately 5.2% of all housing in the City according to the Mobile Home Parks Report