HomeMy WebLinkAboutAdopt Resolution No. 2018-50 opposing the Local Rent ControlFile #: 18-279
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MEETING DATE: 9/4/2018
REQUEST FOR CITY COUNCIL ACTION
SUBMITTED TO: Honorable Mayor and City Council Members
SUBMITTED BY: Fred A. Wilson, City Manager
PREPARED BY: Antonia Graham, Assistant to the City Manager
Subject:
Adopt Resolution No. 2018-50 opposing the Local Rent Control Initiative of 2018 as
recommended by the Intergovernmental Relations Committee (IRC)
Statement of Issue:
On July 25, 2018, the Intergovernmental Relations Committee met and members recommended that
the City take a position on Proposition 10 Local Rent Control Initiative of 2018 which will appear on
the November 2018 ballot.
Financial Impact:
There is no fiscal impact.
Recommended Action:
Adopt Resolution No. 2018-50, "A Resolution of the City Council of the City of Huntington Beach
Opposing the Local Rent Control Initiative of 2018."
Alternative Action(s):
Do not adopt the resolution and direct staff accordingly.
Analysis:
On July 25, 2018, the Intergovernmental Relations Committee comprised of Mayor Mike Posey,
Mayor Pro Tern Erik Peterson, and Council Member Lyn Semeta, met and discussed pending
legislation and November 2018 ballot measures. The Committee voted unanimously to take an
Oppose position on Proposition 10 in the form of a Council Resolution.
Proposition 10 is an initiated State statute that would repeal the Costa -Hawkins Rental Housing Act
(Costa -Hawkins), thus allowing local governments to adopt rent control ordinances - regulations that
govern how much landlords can charge tenants for renting apartments and houses. Proposition 10
would also state that a local government's rent control ordinance shall not abridge a fair rate of return
for landlords.
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File #: 18-279 MEETING DATE: 9/4/2018
Costa -Hawkins is a State statute that limits the use of rent control in California and provides that
cities cannot enact rent control on: (a) housing first occupied after February 1, 1995; and, (b) housing
units where the title is separate from connected units, such as condominiums and townhouses.
Costa -Hawkins also provides that landlords have a right to increase rent prices to market rates when
a tenant moves out. Prior to the enactment of Costa -Hawkins, local governments were permitted to
enact rent control, provided that landlords would receive just and reasonable returns on their rental
properties.
While the State is in the midst of a housing crisis, Proposition 10 is not a panacea and does little if
anything to solve the State's housing problem and is a deeply flawed measure that will likely worsen
the problem. Independent academic experts from Stanford and U.C. Berkeley agree that Proposition
10 will reduce construction of affordable and middle-class housing and eliminates protections for
homeowners. Homeowners who rent even a single room in their homes will be subject to permanent
price controls enacted by local governments and unelected rent boards. These changes will reduce
home values for middle-class families at a time when many are counting on their homes to help
finance their retirement. Additionally, Proposition 10 will cause property owners to take rental units
off of the market in favor of vacation listing services like "Air BnB" and "VRBO" which means more
short term rental units in our communities and less affordable housing for renters - further driving up
housing costs.
Proposition 10 is opposed by a myriad of groups throughout the State. Veterans, seniors, teachers,
affordable housing advocates, and the business community all have taken an Oppose position on
Proposition 10.
Environmental Status:
Not Applicable.
Strategic Plan Goal:
Improve quality of life
Attachment(s):
1. Resolution No. 2018-50, "A Resolution of the City Council of the City of Huntington Beach
Opposing the Local Rent Control Initiative of 2018."
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RESOLUTION NO. 2018-50
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF HUNTINGTON BEACH OPPOSING THE LOCAL
RENT CONTROL INITIATIVE OF 2018
WHEREAS, the Costa -Hawkins Rental Housing Act was signed into law in 1995 to
prevent cities from enacting rent control on housing first occupied after February 1, 1995; and
WHEREAS, the Costa -Hawkins Rental Housing Act gave landlords the right to increase
rent prices to market rates when a tenant moves out; and
WHEREAS, Proposition 10 was placed on the November 2018 statewide ballot through
the initiative process to repeal the Costa -Hawkins Rental Housing Act; and
WHEREAS, the State's nonpartisan Legislative Analysts Office (LAO) points out that
expanding the number of housing units covered and prohibiting landlords from resetting rents to
market value for new tenants will not increase the supply of housing in California and likely
would discourage new construction in the state; and
WHEREAS, Proposition 10 would cut revenues to state and local governments by up to
hundreds of millions of dollars, according to the LAO; and
WHEREAS, the policies authorized by Proposition 10 have been shown to reduce
property values by more than 10% and significantly restricts what single-family homeowners can
do with their homes; and
WHEREAS, Proposition 10 contains a hidden loophole requiring taxpayers to pay the
initiative supporters' legal bills for participating in certain lawsuits, even if they lose and even if
their position is frivolous.
NOW, THEREFORE, the City Council of the City of Huntington Beach does hereby
resolve as follows:
SECTION 1. The City of Huntington Beach hereby opposes the Local Rent Control
Initiative sponsored by the Coalition for Affordable Housing on the grounds that it repeals a
Housing Law with no solution; and
SECTION 2. The City of Huntington Beach hereby opposes the Local Rent Control
Initiative sponsored by the Coalition for Affordable Housing because it will reduce home values;
and
18-6783/186084
SECTION 3. The City of Huntington Beach hereby opposes the Local Rent Control
Initiative as it takes away local control.
PASSED AND ADOPTED by the City Council of the City of Huntington Beach at a
regular meeting thereof held on the 4th day of Sept®ber _ , 2018 .
REVIE E D APPROVED:
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ITIATED AND APPROVED:
stant to the City
18-6783/186084
Res. No. 2018-50
STATE OF CALIFORNIA
COUNTY OF ORANGE ) ss:
CITY OF HUNTINGTON BEACH )
I, ROBIN ESTANISLAU, the duly elected, qualified City Clerk of the
City of Huntington Beach, and ex-officio Clerk of the City Council of said City, do
hereby certify that the whole number of members of the City Council of the City of
Huntington Beach is seven; that the foregoing resolution was passed and adopted
by the affirmative vote of at least a majority of all the members of said City Council
at a Regular meeting thereof held on September 4, 2018 by the following vote:
AYES: Semeta, Posey, Delgleize, Brenden, Peterson
NOES: O'Connell, Hardy
ABSENT: None
RECUSE: None
City Clerk and ex-officio Clerk of the
City Council of the City of
Huntington Beach, California