SENATE BILL 985 (KUEHL)
WILL ELIMINATE RENTAL HOUSING

The Kuehl bill will put condos back under rent control. This will force owners to sell every condominium unit that becomes vacant. California will lose rental housing units and force rents up!

The Santa Monica Rent Control Board voted to exempt condos from rent control upon voluntary vacancy when the Costa Hawkins bill first passed. What the Rent Control Board understood was that rent control only serves their purpose when an owner does not have another option. An owner only rents his units because he cannot sell them or he has no need to owner occupy the unit. However, a condo owner has the option to sell. The Rent Control Board understood that they had to exempt condos from rent control in order to encourage owners to rent their units. Otherwise, rental units would be lost forever.

The stated purpose of rent control was to protect low-income individuals. Since condos are the nicest units in Santa Monica, they are rented as luxury housing to wealthy, high-income individuals. Thus, rent control would not be serving its stated purpose by controlling luxury units.

SB 985 is unfair because owners rented condos relying on the Santa Monica Rent Control Board’s position of exempting them from Rent Control. Now the Kuehl bill will change the rules retroactively to May 7, 2001 without even informing owners.

Another part of the Kuehl bill requires owners to give a sixty-day notice of termination instead of a thirty-day notice. After the outcry from law enforcement, Ms. Kuehl amended the bill to only be a pilot program in three cities, namely Santa Monica, Los Angeles, and West Hollywood. However, she forgot to mention to legislators that all three cities have just cause eviction protection on all units built prior to the late seventies. Thus, in about 90% of the units in those cities, a thirty-day notice could not be served to evict without just cause. Just cause means that owners probably have to file an unlawful detainer to evict a problem tenant.

The stated purpose for the extension of the notice requirement from thirty to sixty days was to protect tenants who were having their buildings rehabilitated. However, the newer buildings built in the 80’s and 90’s are not the buildings being renovated.

I hate to be cynical, but the extension of the thirty-day notice to sixty days has little impact within those cities. What’s the point of this bill? It must be to put about 1,400 Condos in Santa Monica under rent control in order to protect the high-income individuals paying market rents for luxury units. It’s a shame to see the California Legislature duped into a statewide bill for such a small impact in Santa Monica.

UPDATE: Unfortunately, the legislature has already passed the bill.

IN ORDER TO SAVE RENTAL HOUSING,
GOVERNOR DAVIS MUST VETO SB 985.