L.A. County’s Latest Attack on Rental Housing

L.A. County’s Latest Attack on Rental Housing

Supervisors Agree to Impose Punishing Inspection and Rent Escrow Program

By Janet Gagnon, Senior Vice President, Government Affairs & External Relations

At the April 23rd Los Angeles County Board of Supervisors meeting, the Supervisors unanimously passed a pair of extremist ordinances that will impose outrageous fees and penalties on already struggling rental housing providers within the unincorporated areas of the County. The new inspection program and escrow plan will cost Los Angeles County millions of dollars each year for administration and enforcement, much of which will be assessed to property owners who are still “licking their wounds” following three-plus years of COVID-era regulations that prevented owners from collecting legally owed rent and from increasing rent despite out of control inflationary pressures.

Sadly, the Board of Supervisors made their decision based upon conjecture – no facts, no study, and no data whatsoever. The Board of Supervisors meetings have unfortunately devolved from a place of high esteem when conducting important County business into an opera house with overly dramatic performances by tenant activists replete with costumes (one activist dressing as a cockroach) heard repeating well-rehearsed, scripted lines about some imaginary, villainous landlord forcing them to live in squalor.  

The Supervisors, by allowing themselves to become accomplices in this latest operatic performance, have been silencing all reasoning, data research and logic in favor of decisions making based nothing more than emotions, scripted stories of the same unverified “harms” and their desire to be lovingly embraced by the activists – in effect, the Supervisors’ decision making is based upon nothing more that air. The only thing left out of this tragic opera of the April 23rd Supervisor meeting was the orchestra but I’m sure that will be added soon to a future meeting as well.  

The severity of the apparent “spell” cast upon the Supervisors by the tenant groups was exemplified by Supervisor Janice Hahn, when she made the declaration “It is a perfect world” in response to some rational questioning by Supervisor Kathryn Barger seeking data with which to make an informed decision.  Unfortunately, however, even Supervisor Barger eventually succumbed to tenant activist drama and voted in favor of the two ordinances.

It is nothing short of astounding to see our Los Angeles County Supervisors allowing themselves to be caught up in such extremist demands that clearly defy logic and reason at the hands of activists who deploy common salesman tactics that create false “urgency” to justify reckless and harmful decision making that will greatly reduce the supply and quality of rental housing for years to come as well as devastate many small multifamily owners (many of whom are seniors) already struggling to hang on after years of unpaid rent due to COVID-19 moratoriums.  

Rather than uplifting a dying breed of small, independent rental property owners who are providing the bulk of the County’s “naturally occurring” affordable housing units to renters, and creating policies encouraging them to stay in business, instead the Supervisors once again chose to turn a blind eye to mom-and-pop owners by instituting radical, one-size-fits-all ordinances treating ALL rental housing providers as if they are slumlords and saddling them with yet a SECOND mandatory annual fee per unit under the new inspection program.  

These ordinances also prescribe predatory late fee penalties of 25% and 50%, respectively and require civil action penalties of a MINIMUM of $1,000 PER DAY per violation and up to $7,000 per violation.  What small business owner in any industry can withstand such openly hostile penalties and abusive treatment by their local elected officials?!! These outrageous inspection fees that are 2.5 times greater than those charged by the City of Los Angeles for a much larger program. These fines and penalties are even more unjustified and inappropriate given the fact that staff openly admitted that they did not yet know the full cost of the entire program.  How can one set an appropriate inspection fee whe he or she does not already have a concrete understanding of the costs?

In a modest nod to sanity, Supervisor Holly Mitchell requested two items as report backs from staff concerning the ordinances, one of which is due in September 2024.  Unfortunately, even these minor requests were met with severe and hostile resistance from Department of Consumer and Business Affairs Director, Rafael Carbajal, claiming that nothing should be done to “fix” the inherent and extreme problems contained in these ordinances for at least 5 years.  Such an approach would be completely inappropriate and irresponsible!  

Waiting 5 years to fix obvious problems that will cause small owners to go out of business is relief 5 years too late!  

Janet Gagnon is the Senior Vice President, Government Affairs & External Relations at the Apartment Association of Greater Los Angeles