Landlords Renew Anti-Rent-Control Fight : Legislation: Bill would make it easier to increase rents when apartments are vacated. Critics say it would hurt the poor.

By MARK GLADSTONE

June 30, 1991 12 AM PT

TIMES STAFF WRITER

SACRAMENTO — Reviving a decade-long fight, landlord groups have launched a new legislative assault on tough local rent-control ordinances in Santa Monica, West Hollywood and a dozen other cities in California.

A bill by Assemblyman Jim Costa (D-Fresno) targets an important element of these local laws: restrictions on a landlord’s ability to increase rents when an apartment becomes vacant.

Costa’s legislation would ease these so-called vacancy controls, allowing unrestricted rent increases unless local rent controls apply solely to low- and moderate-income households.

Supporters, including the California Housing Council and the California Apartment Assn., maintain that the Costa bill would focus the benefits of rent control on lower-income tenants, not on upper-income renters who lease luxury housing units.

Opponents contend that Costa’s goal is to gut local rent controls. They say his bill would fail to help poor people and instead would establish an incentive for landlords to lease apartments to upper-income tenants.

In May, Costa’s measure cleared the Assembly by a 44-16 vote and was sent to the Senate, where it is pending in the Senate Judiciary Committee.

In the past, similar anti-rent-control proposals have stalled in the committee, whose membership includes Senate President Pro Tem David A. Roberti (D-Los Angeles). Roberti, whose district includes West Hollywood, remains a staunch opponent of legislative efforts to weaken rent control, according to an aide.

Even so, supporters are pressing for passage of Costa’s proposal because the bill spotlights rent control “in a way the issue hasn’t been raised before,” asserted Steve E. Carlson, a lobbyist for the Housing Council, an association of apartment owners and developers.

Still, it is unclear whether the measure will clear the Senate this year. Carlson said a decision has not been made on whether to seek a hearing on the measure this year or postpone it until 1992.

Even though the Senate has been the graveyard for anti-rent-control proposals, tenant groups opposing the Costa bill say they are paying close attention. Lenny Goldberg, West Hollywood’s capital lobbyist, said: “With an issue like rent control, you can’t take anything for granted.”

Since the state’s first residential rent controls were imposed in the late 1970s, landlord and real estate groups consistently have sought, without success, to impose state guidelines on local rental controls. Last year, another effort stalled in the Assembly Ways and Means Committee.

As lawmakers have debated the issue, 14 cities have imposed residential rent controls in California, according to an Assembly analysis of the Costa bill. The cities that currently have vacancy control and would be directly affected by the Costa bill are Santa Monica, West Hollywood and Palm Springs in Southern California and Berkeley, Cotati, East Palo Alto and San Francisco in Northern California.

The San Francisco Board of Supervisors recently enacted a provision that, beginning next month, will make its ordinance more restrictive by capping rental increases. About nine years ago, the Los Angeles City Council discussed a similar proposal, but it “didn’t go anywhere,” said Mike Hembree, acting director of rent stabilization.

Costa contends that academic studies show that more stringent rent controls, such as in Santa Monica and West Hollywood, mostly benefit higher-income tenants. As a result, he said, “people who need it the most are being driven out of these areas.”

Costa also maintains that these laws lead frustrated landlords to remove rental units from the housing market.

In the past, Costa has sought approval of an outright ban on vacancy control. His current legislation, Costa said, “backs off that approach by permitting vacancy control if it is part of an ordinance whose benefits are directed to low- and moderate-income renters.”

Donna Campbell, legislative counsel to the California Apartment Assn., said the legislation would direct Santa Monica and West Hollywood to raise rents “to a market level when the unit is voluntarily vacated” or tailor rent control so it applies to low- and moderate-income tenants.

However, Tony Trendacosta, general counsel to Santa Monica’s rent control board, said “low-income units are going to low- and moderate-income people.” Trendacosta also noted that for the past 18 months Santa Monica has had a program to encourage landlords to rent to low- and moderate-income tenants. However, few landlords have participated in the program.

Currently, Santa Monica does not allow rents to rise when the unit is vacated. Instead, the rent board allows landlords to raise rents each year by a specified amount. Last year, the board authorized a 6% increase, and this year, a 3.5% boost was authorized.

In West Hollywood, vacancy controls are not as stringent. A landlord is allowed to raise rents 10% after a vacancy, but that increase can be taken only once every five years, lobbyist Goldberg said.

He described the Costa bill as “extremely detrimental” to his city and predicted that it would be difficult to implement. He said vacancy decontrols sought by Costa would increase the pressure for evictions and over time turn West Hollywood into a “higher-income community.”