MEASURE M - the Santa Cruz Rent Control And Tenant Protection Act
The November 2018 Santa Cruz City Ballot Measure M, the Santa Cruz Rent Control And Tenant Protection Act, amends the City Charter and imposes "just cause" for eviction laws on nearly every residential property in Santa Cruz. It also resets rents to October 2017 and limits rent increases to no more than increases in the Consumer Price Index. While the intent is good, harmful side-effects outweigh benefits. Here is the full text of the 2018 Measure M Ballot Initiative, key portions are discussed below.
Just Cause for Eviction
The just cause for eviction section (Section 5) establishes provisions that will be applied to nearly every property in the City of Santa Cruz. Section 5 details and defines “just causes” to terminate a tenancy with a standard list with one big exception - the end-date of a lease or month-to-month agreement is excluded, and therefore is no longer a valid reason to give tenants notice to move.
Additionally, housing providers must provide at least six times the then current fair market rent as relocation assistance to affected Tenant households if one of the following “just causes” is present:
· Vacating an unpermitted rental unit (one missing one or more City building permits)
· The owner wants to move in
· Necessary and substantial repairs requiring temporary vacancy
· Withdrawal of the unit permanently from rental market (requires 120-day notice)
If the household includes qualified tenants (62 or older, or disabled), the relocation assistance increases to seven months. With qualified tenants a landlord cannot displace tenants and move in at all unless the landlord is similarly qualified or legally removes the unit from the rental market for ten years, in which case 12 months notice is required. A Rent Board can also arbitrarily define other penalties. Six-months relocation fees are also due if renters receive a rent increase 10% or greater due to repairs or improvement and find it unaffordable. Fair market rent is determined by the U.S. Department of Housing and Urban Development.
Section 5(a)(2)(A) severely limits the ability to limit subleasing and specifies that lack of creditworthiness can not be a reason for rejecting a sublease. Section 5a(2)(A)iii further removes all ability to limit subleasing to family members, relatives, or their partners and the ability to limit the maximum occupancy of a unit below the Federal Housing occupancy limit.
Additionally, in Section 3(w) the definition of ‘Tenant’ includes these sub-lessors as being defined as Tenants, who in turn can add relatives or partners without further limit by the landlord or other housemates up to the UHC 503(b) maximum occupancy.
This federal guideline section 503(b) of the Uniform Housing Code sets the minimum size for a dwelling by number of residents. Each dwelling must have at least one room measuring at least 120 square feet; and all other habitable rooms excluding kitchens must be at least 70 square feet. The size determines the maximum occupancy rate. Two people can occupy a minimum-sized dwelling. For each additional occupant, the minimum must increase by 50 square feet. This means the limit for an average three bedroom house is around 16 people. Along with attendant cars and trash. This will result in significantly increased numbers of renters per house and further impact neighborhoods.
Rent Price “Stabilization”
Section 6 of Measure M specifies that for covered rentals, rents will be rolled back to the rent in effect on October 19, 2017. Future rent increases will be limited to an amount equal to the Consumer Price Index and cannot exceed 5 percent annually. The only rents controlled by Measure M are rent increases on apartments built before 1995. Rents on single-family homes are not price-controlled.
Santa Cruz Rent Board
Section 10 establishes a Rent Board with 7 appointed members replaced by 5 elected members in following years.
· Board members determine their own salaries and can both charge fees and demand money from the City General Fund used for fire, police, parks, and essential services.
· The Rent Stabilization board does not report to the City Council or City Manager. There is no mechanism for appropriate legal or financial oversight.
· The Rent Board has the power to raise relocation fees beyond 6 months fair market rent, without outside approval.
· The Rent Board can create new penalties, as they wish, without city or voter input.
· Initial members are appointed, future members are elected. Unlike a court, there is no requirement for impartiality.
Because of the state level Costa-Hawkins act, single-family residences and apartments built after 1995 are excluded from the rent control portions of Measure M. Also because of Costa-Hawkins the following are excluded from the rent price stabilization laws but they are still subject to just cause eviction laws, the Rent Board, and the rest of the initiative.
· Single Family Residential Homes
· Accessory Dwelling Units, ADUs
· Condominiums (with some restrictions)
· Units built after 1995.
There is a parallel state level measure, Proposition 10, on the ballot in November to repeal Costa-Hawkins, in which case these rent control exemptions would no longer apply.
Regardless of Costa-Hawkins both short-term vacation rentals and rental units in which the tenant shares a bathroom or kitchen with the landlord if the house is the primary residence of the landlord are exempt from both the proposed rent control and just cause for eviction laws.