ACTION SUES SANTA MONICA

ACTION Apartment Association has paired up with the Pacific Legal Foundation and Rosario Perry to sue the city of Santa Monica. Action filed the case on september 11, 2006.

Santa Monica recently passed Ordinance 2191 which requires us to construct subsidized housing for low income person’s on-site instead of allowing us to pay in lieu fees. This is a taking under the 14 Amendment and also a violation of due process under the 5th Amendment.

The Ordinance is specifically designed to make it economically unfeasible to redevelop your property into condominiums. This Ordinance diminishes the value of all properties in Santa Monica because it removes one of your options to redevelop your property to its highest and best use in the future.

Action has teamed up with The Pacific Legal Foundation (PLF) from Sacramento in the past. PLF is a non-profit property rights watch dog from Sacramento. Their primary focus has been to defend your property rights against unconstitutional takings.

In the early 90’s PLF filed the Santa Monica Beach versus Santa Monica Rent Control case. PLF won a unanimous Appellate Court ruling that held that Santa Monica Rent Control was invalid because it did not “substantially advance a legitimate government interest.” PLF proved that rent control did not protect the poor and needy but merely provided rent relief for wealthy tenants. However, we narrowly lost the case at the California Supreme Court level by a single vote.

The Santa Monica Beach case was argued by James Burling and R.S. Radford. James Burling has returned to Santa Monica and has teamed up with Rosario Perry for our most recent case.

This case will have far reaching implications. A success here will improve the property values for all owners in Santa Monica. We will need your support through your donations in order to prove that Santa Monica has taken your property without just compensation.

For an in-depth analysis of the lawsuit, please read Rosario Perry’s article in this issue of WAM.

At the last ACTION meeting on September 11, David Daniels and Tracy Conden from the Santa Monica Rent Control staff attended. They arrived carrying an olive branch requesting open dialog with owners in order that they may fairly administer rent control. I guess the Rent Control Board felt embarrassed when in June the staff had recommended that all future Rent Control registration fees and property tax pass throughs be forever denied for new tenants. Your Action speaker’s team effectively pointed out the errors of proceeding down that path. The Rent Control Board went against its staff recommendations and agreed to allow pass throughs for future tenants. The Rent Board asked the staff go and communicate with owners to find out our concerns.

OK, so the Rent Control law will never be impartially administered. But at least they are paying lip service to the fact that they are “supposed to.”

Proposition 90, (the Anderson initiative) will be on the November ballet and requires payment of just compensation for “Government actions that result in substantial economic loss for private property including down-zoning.”

Prop 90 would require cities to provide compensation in the event that your property is taken by eminent domain or in the event that the city downzones your property. The prospect of Cities having to pay property owners in the event they downzone property has Cities quaking in their boots. Santa Monica, never wishing to have to pay for taking your property, is accelerating its own down-zoning. The planning commission recommended to quickly down-zone all residential property including single family properties.

The Santa Monica planning commission has been in the midst of an extensive two year process to rezone Santa Monica. However, in the face of the Anderson initiative, they want to overreact and immediately confiscate your property without just compensation by immediately down-zoning. Of course the net result of such down-zoning is always to make it economically unfeasible to re-develop your property for the time being.

Eventually the economics catch up, properties get demolished and fewer units get built. This has happened time and time again in Santa Monica. Ultimately what it does is push up property values faster and faster out of the reach of the people they are trying to serve. Most of Santa Monica’s constituents from the Rent Control era have been priced out of the market, not by pure economic forces but by the cities down-zoning policies. I predict the city council will adopt an Ordinance amending article 9 of the municipal code which will substantially reduce building height, unit density and lot coverage.

At the same meeting that the Ordinance was initially read the city passed an Ordinance which allows the increase in density for the civic center project. Once again the city is speaking out of both sides of its mouth.

We must unite behind the PLF lawsuit in order to protect your property.