Public Policy Issues
The BRHC advocates for fairness in the policies that affect how our members do business.
Representation matters, and the BRHC ensures a strong presence at all city-related meetings where these crucial policies are being crafted. We don't just sit at the table; we actively contribute by making public statements that advocate for the interests of all stakeholders. Our goal is to foster a more inclusive decision-making process, urging city leaders and commissioners to consider the diverse perspectives of our community members.
Overview: Pro-tenant City Council members and the Mayor report that "certain landlords have actively denied renting units to tenants based on their source of income, " including Section 8. Landlords have the right to set certain financial requirements that a prospective tenant must meet to rent. Most landlords use financial criteria to help ascertain whether a tenant is likely to be able to pay their rent, especially in a market where a tenant can easily pay more than the national recommended average of 33% of gross income going towards rent. But City Council thinks Section 8 tenants are being discriminated against because part of their income comes from a subsidized source.
Proposal: Landlords will not be able to discriminate against the source of income actively. This means you will need to consider anyone with a Section 8 voucher just as you would a tenant without a voucher. You would not be able to say "No Section 8" in your advertising of a unit. The proposal does not force you to take a Section 8 tenant if they do not qualify under your rental criteria.
Impact: The primary impact to the rental housing provider is to ensure they follow the rules for fear of one misstep sending them to court. Many landlords don't take Section 8 vouchers, not because of the source of income, but rather as a response to the program itself. Section 8 requires the landlord to hold a business contract with the Berkeley Housing Authority and to follow their rules for housing tenants. Unfortunately, there are too many horror stories about the BHA's response to difficult tenants and the inability to get out of the program once you're in. Until the federal program fixes the larger systemic issues, landlords will continue to remain skeptical of the program's value and won't participate.
Final Outcome: The ordinance took effect on September 26, 2017.
Overview: This is another proposal brought forward by (then Councilmember) Mayor Arreguin, who consistently seeks any opportunity to set in place anything he can that he feels protects tenants. This particular proposal follows suit of Oakland and San Francisco -- both of whom have in place Tenant Anti-Harassment ordinances.
Proposal: It was clear the proposal was an effort to reduce harassment that is purposely aimed at getting the tenant to vacate the unit so that the unit may be brought to market rate. It was designed to give the City Attorney power to decide to file a civil action against a landlord who violated the ordinance.
Impact: For landlords operating in a manner that would not be deemed harassment under the definitions of this ordinance, there was little impact. For those who choose to use more forceful, threatening, or harassing tactics to force a tenant out, this ordinance would provide a tenant with more paths to a civil suit. But as most policies do, it has left room for misinterpretation or a more broad definition of harassment, which could impact an owner when they are dealing with a particularly difficult tenant. Additionally, there is no telling the City Attorney's capacity to take complaints of this nature or to follow through on civil action. Note: In July 2017, the City Council voted to give $300,000 over two years to the Eviction Defense Center and the East Bay Community Law Foundation so that they could help "file actions related to the Tenant Protection Ordinance."
BRHC Position: The Coalition's Executive Director was invited by (then CM) Mayor Arreguin to discuss and make suggestions around the ordinance. Her primary focus was centered around two important considerations. First, the landlord must have a clear "pattern and practice of violation" before the City Attorney may consider anything. This will help to minimize the problem that may arise when a tenant sees this as an opportunity to halt a viable eviction. The second is to make certain that there is a clause in the ordinance under General Remedies that requires the Tenant to properly notify the Owner or Agent of any issue of habitability prior to filing any civil action. Time and time again, we have seen cases where a Tenant goes straight to Code Enforcement or the Rent Board to bring up an issue of habitability, and the owner doesn't find out about it until the ball's been kicked way down the path. This will help to provide some protection to the Landlord in cases where the Tenant is abusing the Ordinance in their favor. The proposal did end up being inclusive of these suggestions.
Final Outcome: This ordinance went into effect on April 12, 2017. You can view the proposed ordinance here. A form was published by the Rent Board in April of 2018 in which any new tenancy that starts after April 2017 (yes, 2017, even though the notice wasn't created until 2018) must be given to the tenant.
Overview: In 2000, Washington D.C. adopted a Tenant Opportunity to Purchase Act, giving sitting tenants first right of refusal when an owner puts a rental property up for sale. Mayor Arreguin decided the City of Berkeley needed a similar program.
Proposal: The proposal is two-fold: it provides for a very specific process of first right of refusal for both Single Family Homes and multi-unit buildings. It is combined with a program that the city would administer to help tenants or tenant groups finance the purchase of the property they rent.
Impact: The primary impact is one around the ability to put your property on the open market the minute you are ready to sell. The first right of refusal process gives the tenant up to 4 months to secure financing and work out any details specific to their ability to purchase. To see a visual of the process as it works for the purchase of a Single Family Home in Washington, click here.
BRHC Position: Right now, we remain cautious about our position. This proposal is only in the beginning stages of being explored. It's worth noting that about 1,000 purchases have occurred in Washington over the past 16 years in a city of almost 690,000 people. The impact could be considerably less in Berkeley and, at the end of the day, may not warrant worrying about.
Status: In February 2017, the City Council directed the City Manager to research and pull a proposed Act together. It remained dormant until the summer of 2018 when the Housing Advisory Commission took the issue back up.
Overview: The Relocation Ordinance applies if a rental housing provider needs to temporarily vacate a rental property in order for repairs to be completed to bring the property into compliance with applicable building and housing codes. It was originally adopted in April 1986 to provide protections and relocation benefits for tenant households that were temporarily displaced due to code enforcement action. Since its adoption, it's been amended several times, with the most recent amendment in October 2011. This amendment included a provision that specified the amounts for the various components of the relocation payments to be updated and authorized by Council Resolution. Relocation payments are detailed in this Council Resolution.
Proposal: In November 2015, there was a large fire at 2449 Dwight Way in which multiple tenants were displaced. In interpreting the ordinance (as it applied to that particular situation), it was determined by the Rent Board and Housing Advisory Commission that "clarifying language should be added in order to make it easier to implement in the future." That led to the City Council's current consideration, which encompasses three points of clarification of the current ordinance. Two were minor changes and did not affect such things as payment amount to displaced tenants or an expansion of what constitutes a "covered" incident. The third was the addition of the clause "tenants are entitled to relocation payments...to the extent that the tenant's insurance does not cover relocation payments." This clause permitted the landlord to deduct from money due to the displaced tenant any amount the tenant may have received from their own policy. The Housing Advisory Commission was very split on the matter when recommending it to the City Council as some felt it created "two classes of tenants -- those that can afford insurance and those that can't." It was not clear how they felt this would impact the tenant in a negative way when it came to relocation reimbursements. Some HAC members wanted to "require" the landlord to hold relocation-specific insurance, but that did not make it into the final proposal to the Council.
Impact: The most recent modifications of the ordinance have no impact of significance to rental property owners other than codifying what the city says is already happening (deduction of money received by the tenants' insurance from the total amount due to the tenant under the ordinance). However, the impact of the ordinance, even from its prior format, is considerable to any property owner who finds themselves in a situation where multiple tenants need to be relocated. Current per diem payments are $120 for a single-person household, $135 for two, and $166 for three per day. There is an additional dislocation allowance of $400 per tenant household, a fixed payment for moving costs of $200, and a fixed payment for storage costs of $200. It is unlikely that a landlord's building insurance would cover the provisions of a city-specific ordinance so it's important to check with your insurance company to see if an additional rider is needed.
BRHC Position: The Coalition did not have objections to the proposed modifications of the ordinance because they did not substantially change anything nor had an adverse effect on rental housing providers. We supported the codifying of a practice already in place with the addition of the renter's insurance clause. We do feel there are other aspects of the ordinance that warrant further clarification and, ultimately, modifications. We believe that the ordinance, even in its prior format, prevents capital improvements from occurring because the building department is hesitant to declare that a relocation is necessary in order to complete the work.
Final Outcome: On February 9, 2016, the City Council voted to adopt the first two modifications of the ordinance and rejected the new clause, saying it needed more discussion at the HAC level. The BRHC spoke against their action but ultimately supported making the ordinance more clear. We spoke strongly against the potential requirement of owners to hold relocation insurance, noting that many owners have already attempted to gain the insurance and have been unable to find a carrier willing to write the rider. A second reading concluded on February 23, 2016. This ordinance went into effect on April 30, 2016.
Overview: Previously, there was no Tenant Buyout Ordinance on the city's books. then Councilmember Arreguin believed that landlords were using buyouts as an alternative to evictions because they are not regulated, and the landlord is trying to "circumvent restrictions that apply in an eviction process." Santa Monica and San Francisco had recently adopted Tenant Buyout Ordinances. Arreguin also said that landlords were using buyouts as a way to circumvent requirements on Ellis Act evictions, which the Rent Board has deemed "on the rise," although data as of 2017 showed a total of three Ellis Act evictions.
Proposal: The ordinance proposed to regulate buyout agreements by requiring the landlord to provide written notice to their tenant of their rights pertaining to buyout agreements. It included 1) the right to enter into a buyout agreement, 2) the right to consult an attorney, and 3) the right to cancel the agreement at any time up to 30 days after all parties have signed. Read the full text of the proposed ordinance here.
Impact: The primary impact is in the form of continued regulation, oversight, and intervention in the relationship of a landlord and tenant -- and, in this case, a private party agreement. The addition of the opportunity for the tenant to rescind the agreement within 30 days of signature could pose additional challenges for the landlord. It is unclear whether an exchange of money upon execution of the agreement would override notification to rescind.
BRHC Position: We supported fair and proper notification of a tenant's right to enter into the agreement as well as their right to consult an attorney. We remained cautious about the proposed time in which to rescind the agreement. We have always been opposed to additional "busywork" given to the Rent Board that is unnecessary and only further helps to inflate their budget, of which we felt this could fall in that category. The position that no department should take on unnecessary work was supported by Councilmember Capitelli during this process when he noted that the referral by the City Manager should not include the Rent Stabilization Board's collection of copies of the agreement.Final outcome: On February 9, 2016, the City Council referred this to the City Manager and Rent Board to be drafted. It quickly came back on the February 23, 2016, agenda as a First Reading by the City Manager. Unfortunately, the City Manager did not take Capitelli's recommendation into consideration, and there is a part of the Ordinance that states the landlord shall provide a copy of the agreement to the Rent Stabilization Board no sooner than the thirty-first day after the buyout agreement is executed, and no later than the sixtieth day thereafter. The Coalition did work with the RSB when they were crafting their proposed language to make certain that any buyout details (i.e., name of owner, address of property, and buyout amount) were not made public and that all data related to buyouts were aggregated. The City Council accepted the proposal with the privacy amendment, and it was passed. The Tenant Buyout Ordinance went into effect on April 30, 2016.
Overview: There is currently no Prevention of Eviction for Minor Offenses Ordinance on the city's books. Councilmembers Worthingon, Arreguin, and Anderson believe that tenants need more protections and that since SF created an ordinance, so should Berkeley.
Proposal: The ordinance would amend the Administrative Code of the city and the landlord's ability to evict in addition to restrictions for seeking recovery of possession. See all 11 items of the ordinance here.
Impact: Besides making it more difficult to evict when necessary, if you read the ordinance closely, you will see a way in which it permits the addition of occupants, even if that number exceeds what is stated in the rental agreement/lease. It is written as a reason not to be permitted to evict. Still, the consequences are that of additional tenants without the landlord's ability to approve or seek increased rent based on those additional tenants. It also notes that "after certain vacancies" (although it is not clear what these are), the landlord will have to "set a new base rent for the next five years as the lawful rent in effect at the time of vacancy."
BRHC Position: We support fair and proper notification of a tenant's right to enter into the agreement as well as their right to consult an attorney. We remain undecided (yet cautious) about the proposed time in which to rescind the agreement. We are always opposed to any additional "busywork" given to the Rent Board that is unnecessary and only further helps to inflate their budget. The position that no department should take on unnecessary work was supported by Councilmember Capitelli when he noted that the referral by the City Manager should not include the Rent Stabilization Board's collection of copies of the agreement.
Status: This proposal was pushed off for a number of months by the City Council. Once it was finally brought forth, Councilmembers had too many concerns about the issues raised by the Coalition and not enough time to discuss them, so they voted it down. The author of the proposal is set to retire from the Council at the end of 2018.
State Housing Policy Issues
State issues affect how you do business, too. We will update you regularly on the bills and other California state policies that impact your business. Oftentimes, there are opportunities for local rental housing providers to provide "testimony" to state legislators to let them know directly how their decisions impact your business. The Coalition regularly joins other like-minded industry organizations in appealing to our government officials in Sacramento.
State Senate & Assembly Bills Overview
California has one of the toughest challenges in all of the United States when it comes to keeping up with housing needs. There is intense pressure being put on our state's resources to meet the demand. The past four legislative years for the Senate & Assembly have been loaded with housing proposals. The 2023/24 bill year is turning out to be no different. We are heavily involved in discussions and strategies for shaping these bills and will keep you apprised. Learn more about the California Rental Housing Association and their work to defeat bad policy.
Historical Overview: The Costa-Hawkins Rental Act of 1995 is a state law that permits two very critical items for rental housing providers. First, it limits rent control to units built before 1995 and does not permit rent control for Single Family Homes, condos or anything built after 1995. Secondly, it permits what is called a "vacancy decontrol event." Vacancy decontrol says that when a tenancy ends and a tenant vacates the landlord is permitted to set a rent to one of their choosing. C/H was put into place as a response to the strict rent control of cities like Berkeley and Santa Monica from the late 70s/onward. Prior to Costa-Hawkins implementation, rent control was applied to every rental unit and it never permitted the rent to be raised even when a tenant moved out (this is called "vacancy control.")
Bill: Pro-tenant activists, housing advocates, and pro-housing affordability Democrats have banded together to try to take down Costa-Hawkins. Quite a number of politicians used the repeal of C/H as part of their platform during the November 2016 election. In February 2017, an Assembly Bill was introduced by State Assemblymen in Santa Monica and the Bay Area to renounce Costa-Hawkins.
Impact: This is the most detrimental bill proposed as it fairs for rental housing providers. It has far-reaching implications for all landlords in California. For those in rent-controlled cities, it could take us back to the 80s when the strict price controls resulted in 4,000 owners moving back into their rental units. This was a direct result of not being able to afford to stay in business. Low-income renters, seniors, and African-American tenants were displaced when these owners moved back in. If history repeats itself, it will be devastating. Not only will it force people out of the business, but it will squash the production of new rental units in California.
Current Status: The BRHC is part of the California Rental Housing Association (CalRHA). Together with the California Business Roundtable, the California Business Properties Association, and the California Community Builders, in 2018, we joined forces for "Californians to Protect Affordable Housing." We launched a large campaign to preserve Cost-Hawkins and we showed voters that the Affordable Housing Act (Prop 10) was a flawed policy for the state of California. To learn more about how we fought back, go to www.Prop10Flaws.com
The Bill: Current law requires a tenant to get approval from their landlord for the installation of an electric vehicle charging station at a parking spot designated for the tenant. Current exemptions include any rent control property. This bill would remove the exemption and would require landlords to approve the written request of their tenant to install an EV charging station in accordance with specified requirements.
Rental Housing Provider Support: It is unclear as to whom would be responsible for the costs of installing such a charging station. The value of the station could increase the value of the property, but installations are not cheap. We remain uncertain about support at this time.
Status: New bill as of 2018/2019
Bill: Would change the notice period for notice to vacate or cure from three (3) days for nonpayment of rent to ten (10) days. For more serious violations such as criminal activity, the time to cure would go from three (3) days to five (5) days. For defendants who fail to appear and defend, the bill would impose a 14-day period before the clerk may enter a default judgment and writ of execution. Rental Housing Provider Support: It goes without saying that these new time periods would only draw out what can already be an extremely delayed eviction. Although it may have been designed to protect tenants from unscrupulous landlords, it only ends up harming those landlords who are doing right by law and legitimately have a problem tenant.
Status: Passed. Effective January 1, 2020.
Bill: Would prohibit a landlord from refusing to accept payment from a third party of a tenant's rent if the third party does not reside on the premises (e.g., a church fund). It would require a third party to provide a signed acknowledgment that acceptance of the rent does not establish a landlord-tenant relationship between the landlord and the third party.
Rental Housing Provider Support: Our initial concern with this bill is about the establishment of a landlord-tenant relationship with the third party. This could be especially damaging in rent-control cities like Berkeley. And this is a primary reason why landlords have not taken third-party payments. This legislation could help create guidance that would be important for us and allow the chances of a default of rent payment to go down.
Status: Passed. Effective January 1, 2019.
Bill: Would require the Department of Real Estate to administer a certification program for landlords and property managers to provide education on fair practices and tenant rights. Certification would be good for 2 years. This would make those who have not obtained a certification subject to a specified penalty.
Rental Housing Provider Support: All we have to say is, "Will there be a certification program for tenants?" This bill provides a whole host of issues, the primary of which is how it might affect trade associations that offer landlord education and depend on it as a source of income. Additionally, we would expect to see that the Berkeley Rent Board would be the designated provider of this education, causing a whole new host of problems.
Bill: Would declare the intent of the Legislature to enact legislation relating to just cause evictions of residential tenants across the state. Would require eviction notices to contain a reason as to why the tenant was being evicted.
Rental Housing Provider Support: Although we operate in a "just case" jurisdiction, most rental housing providers know that when Just Cause eviction protections are in place, it is much more difficult to evict a tenant in certain situations. Although this bill does not enact actual just cause reasons which limits the landlord's ability to evict, the Legislature could follow up with state-wide reasons for eviction, such as we have in Berkeley. Naming a reason as to why you are evicting a tenant in a non-Just Cause jurisdiction opens the landlord up for a legal challenge to the eviction.
Bill: Would require an inspection of exterior elevated elements and associated waterproofing elements, including decks and balconies, for buildings with 3 or more multifamily dwelling units by a licensed architect, licensed civil or structural engineer, or an individual certified as a building inspector or building official.
Rental Housing Provider Support: Berkeley is already subject to this proposed law based on its E3 Balcony & Deck Ordinance, which was a result of the tragic Library Gardens balcony collapse. It has proven difficult for owners to be in full compliance with the law because it's been very hard to find contractors who are willing to sign off on such a litigious subject matter. While we support safe housing, we would lobby Legislators to understand the contractor challenges and act accordingly.
Status: New 2018/2019 bill.
Bill: Prohibit retaliation or discrimination of tenants based on immigration status.
Rental Housing Provider Support: Most landlord and real estate groups are neutral. The California Apartment Association is in support.
Status: Passed and signed by the Governor on October 5, 2017.
Summary: If you have any familiarity with the Palmer vs. City of Los Angeles case of 2009, you will know how important that case was to rental housing providers. The case stemmed from a Los Angeles landlord who was required to set aside a number of units in his new construction to be offered as "affordable housing." He argued that by doing so, the city was setting his rent, which was a direct violation of Costa-Hawkins, which says he has the right to set the rent at a number of his choosing. The court agreed. The City of Berkeley managed the ruling by setting mitigation fees in which a developer could decide to build the unit of affordable housing or pay a fee to set market-rate housing rents.
Bill: This bill would clarify that local inclusionary ordinances that require affordable housing units would not be preempted by Costa-Hawkins, in essence wiping out the court decision in the Palmer case.
Rental Housing Provider Support: The California Apartment Association and the California Association of Realtors are neutral on this bill. Local property owner associations like EBRHA and the Apartment Association of Greater Los Angeles remain opposed.
Status: Passed and signed by the Governor on September 29, 2017.