Victory Alert: Santa Monica Rescinds Perpetual Tenancy For Non-Renter Occupants
Victory Alert:
Santa Monica Rescinds Perpetual Tenancy For Non-Renter Occupants
Janet M. Gagnon
Chief Corporate Affairs Officer & SVP, Government Relations
On Wednesday, July 28th, the Santa Monica City Council voted 6-to-0 (with Council Member Jesse Zwick abstaining) to rescind a resolution that would have created a perpetual tenancy for family members and non-family members when a renter voluntarily leaves the rental unit under the existing rent stabilization ordinance (RSO). This is a huge, although belated, win for rental housing providers!!!
As you will recall, on July 14th the City Council voted 4-to-2 (with Council Member Jesse Zwick abstaining) to pass the resolution with only Council Members Lana Negrete (running for re-election) and Barry Snell being brave enough to vote NO. All other council members, including Mayor Caroline Torosis (running for re-election), voted YES on the resolution. Council Member Natalya Zernitskaya specifically asked if the rents would reset to market rate if the renter left for whatever reason and was told by city staff that it would be determined on a “case-by-case basis” under state law via Costa-Hawkins.
AAGLA lobbied heavily against this resolution as creating a perpetual tenancy against state law and warned of substantial litigation in both our formal comment letter submitted on July 13th to the full City Council and on the record and our oral testimony at the meeting on July 14th. Unfortunately, only two rental housing providers showed up to speak at the City Council meeting.
So why the City Attorney is now claiming that the City Council only woke up to the reality of litigation on July 27th is unknown and inaccurate. The answer is that local rental housing providers finally got involved and threatened actual litigation. Then and only then did the City Council finally publicly recognize that the City would be facing a mountain of litigation, which would substantially drain the City’s budget to pay for their attorney fees as well as rental housing providers’ attorney fees, court costs and damages once the City lost such a clear cut case.
On July 27th the City Council and Rent Control Board held a special joint meeting with only the required 24 hours’ notice to discuss this item as the only issue on their agenda. At that meeting they voted 6-to-0 (with Council Member Zwick abstaining) to rescind the resolution that would create a perpetual tenancy and instruct staff to draft a replacement resolution that would ONLY contain the new Just Cause provisions for single-family residences and condominiums as well as extend the existing owner move-in provisions from RSO multifamily to all multifamily, single-family residences and condominiums. The replacement resolution passed on July 28th at the special City Council meeting that was held with only 24 hours’ notice.
This means that there will still be a ballot measure on the November ballot that includes Just Cause for single-family residences and condominiums and owner move-in requirements that allow owners to move in within 60 days of notice (rather than 30 days) and that the owner must stay in the unit for at least two years (rather than one year). In addition, two separate resolutions that were passed at the July 14th meeting will also be included in the ballot measure. One resolution creates a new non-payment eviction threshold of one month’s Small Area Fair Market Rent (SAFMR) according to the U.S. Department of Housing and Urban Development (HUD) utilizing zip codes wholly and partially within the City of Santa Monica. The other resolution makes some administrative changes, including allowing the annual registration fee for RSO units to increase according to the Consumer Price Index for All Urban Areas (CPI-U) for the Los Angeles region starting in 2028.
This article is for informational purposes only. If you have any questions regarding your property or specific leasing issues and the requirements of any legal changes described herein, please consult with an attorney.