Beverly Hills Rent Stabilization Commission Approves Resolution For New RSO Relocation Fee Calculati

Industry News,

At the January 5th, Beverly Hills Rent Stabilization Commission meeting, the Commission approved a resolution for a new relocation fee formula. It is important to note that the resolution is a recommendation for the City Council’s consideration. The City Council has the sole authority to adopt the new formula and can reject the Commission’s recommendation entirely or modify it further.

The Commission has been discussing the City’s relocation formula and what changes to consider since approximately October 2020. The resolution that was advanced generally recommends the following new formula:

  • Adjusts relocation fees based on the formula of three times the median monthly rent for the same size unit, 0,1,2,3, and 4 bedrooms, established on each immediately preceding July 1st based on newly occupied units registered in the City’s rent registry, commencing on July 1, 2022, plus an additional $1,000 for moving expenses plus an additional $2,000 for households with qualifying seniors, disabled, or with a minor child. This proposed formula for calculating relocation fees, expands upon the current bedroom size categories to include three- and four-bedroom sizes, while maintaining the current $2,000 enhanced relocation assistance for qualified renters.
  • Defines small “Mom and Pop” owner as owners of 4 or fewer residential units plus a single-family home all of which are within the City of Beverly Hills not including (1) a real estate investment trust, as defined in Section 856 of the Internal Revenue Code; (ii) a corporation’ (iii) a limited liability company in which at least one member is, or is controlled by, a corporation; or (iv) a partnership in which at least one partner is, or is controlled by, a corporation.
  • Provides a relocation fee reduction of 25% to small “Mom and Pop” owners as defined above, where the no-fault tenancy termination is based on owner occupancy and where the renter(s) has resided in the unit for less than ten years. Where the renter(s) has resided in the unit for 10 years or more, the small “Mom and Pop” owner would be provided a 15% relocation fee reduction.
  • Small “Mom and Pop” owners seeking the above relocation fee reductions would be required to submit a declaration under penalty of perjury that the owner meets the definitional requirements using a form provided by the City.

The City’s current Rent Stabilization Ordinance (RSO) provisions set forth the required relocation fee structure based on unit size of bachelor or single, one bedroom, and two or more bedrooms with the base fee ranging from $6,988.87 to $13,986.75. Households with renters that are seniors, disabled or with a minor child receive an additional amount of $2,000. On July 1st of each year, the fees are adjusted based on the Consumer Price Index.

We will continue to monitor this issue as it advances to the City Council for their consideration, advocate for our members interests and provide updates.