(This page was last updated on 8/14//2017)
Tenant Buyout Ordinance - PASSED with amendment proposed by the BRHC - More information here
Overview: Previously, there was no Tenant Buyout Ordinance on the city's books. then Councilmember Arreguin believed that landlords were using buyouts as an alternative to evictions because they are not regulated and the landlord is trying to "circumvent restrictions that apply in an eviction process." Santa Monica and San Francisco had recently adopted Tenant Buyout Ordinances. Arreguin also said that landlords were using buyouts as a way to circumvent requirements on Ellis Act evictions which the Rent Board has deemed "on the rise" although data as 2017 showed a total of three Ellis evictions.
Proposal: The ordinance proposed to regulate buyout agreements by requiring the landlord provide written notice to their tenant of their rights pertaining to buyout agreements. It included 1) the right to enter into a buyout agreement; 2) the right to consult an attorney; and 3) the right to cancel the agreement at any time up to 30 days after all parties have signed. Read the full text of the proposed ordinance here.
Impact: The primary impact is in the form of continued regulation, oversight and intervention in the relationship of a landlord and tenant -- and in this case, a private party agreement. The addition of the opportunity for the tenant to rescind the agreement within 30 days of signature could pose additional challenges for the landlord. It is unclear whether an exchange of money upon execution of the agreement would override notification to rescind.
BRHC Position: We supported fair and proper notification of a tenant's right to enter into the agreement as well as their right to consult an attorney. We remained cautious about the proposed time in which to rescind the agreement. We have always been opposed to additional "busywork" given to the Rent Board that is unnecessary and only further helps to inflate their budget of which we felt this could fall in that category. The position that no department should take on unnecessary work was supported by Councilmember Capitelli during this process, when he noted that the referral by City Manager should not include the RSB's collection of copies of the agreement.
Final outcome: On February 9, 2016 City Council referred this to the City Manager and Rent Board to be drafted. It quickly came back on the February 23, 2016 agenda as a First Reading by the City Manager. Unfortunately, the City Manager did not take Capitelli's recommendation into consideration and there is a part of the ordinance that states the landlord shall provide a copy of the agreement to the RSB no sooner than the thirty-first day after the buyout agreement is executed. The Coalition did work with the RSB when they were crafting their proposed language, to make certain that any buyout details (i.e. name of owner, address of property and buyout amount) was not made public and that all data related to buyouts was aggregated. The City Council accepted the proposal with the privacy amendment and it was passed. The ordinance went into effect on April 30, 2016.
Prevention of Eviction for Minor Offenses Ordinance - FAILED!
Overview: There is currently no Prevention of Eviction for Minor Offenses Ordinance on the city's books. Councilmembers Worthingon, Arreguin and Anderson believe that tenants needs more protections and that since SF created an ordinance, so should Berkeley.
Proposal: The ordinance would amend the Administrative Code of the city and the landlord's ability to evict in addition to restrictions for seeking recovery of possession. See all 11 items of the ordinance here.
Impact: Besides making it more difficult to evict when necessary, if you read the ordinance closely you will see a way in which it permits the addition of occupants even if that number exceeds what is stated in the rental agreement/lease. It is written as a reason not to be permitted to evict, but the consequences are that of additional tenants without the landlord's ability to approve or seek increased rent based on those additional tenants. It also notes that "after certain vacancies" (although it is not clear what these are) that the landlord will have to "set a new base rent for the next five years as the lawful rent in effect at the time of vacancy."
BRHC Position: We support fair and proper notification of a tenant's right to enter into the agreement as well as their right to consult an attorney. We remain undecided (yet cautious) about the proposed time in which to rescind the agreement. We are always opposed to any additional "busywork" given to the Rent Board that is unnecessary and only further helps to inflate their budget. The position that no department should take on unnecessary work was supported by Councilmember Capitelli when he noted that the referral by City Manager should not include the RSB's collection of copies of the agreement.
Status: This proposal was pushed off for a number of months by Council. Once it was finally brought forth, Councilmembers had too many concerns about the issues raised by the Coalition and not enough time to discuss it that they just voted it down.
Next Up: This proposal could be resurrected at some point in time by CM Worthington, but he would need to address some of the concerns his peers raised.
Section 8 Anti-Discrimination Ordinance - First Reading Completed
Overview: Pro-tenant City Council members and the Mayor report that "certain landlords have actively denied renting units to tenants based on their source of income" which includes Section 8. Landlords do have the right to set certain financial requirements that a prospective tenant must meet in order to rent. Most landlords use financial criteria to help ascertain whether a tenant is likely to be able to pay their rent, especially in a market where a tenant can easily pay more than the national recommended average of 33% of gross income going towards rent. But City Council thinks the primary reason Section 8 tenants are being discriminated against is because part of the income comes from a subsidized source.
Proposal: Landlords will not be able to actively discriminate against the source of income. Meaning you will need to consider anyone with a Section 8 voucher just as you would a tenant without a voucher. You would not be able to say "No Section 8" in your advertising of a unit. The proposal does not force you to take a Section 8 tenant if they do not qualify under your rental criteria.
Impact: The primary impact to the rental housing provider is to make sure they are following the rules for fear one misstep will send them to court. Many landlords don'take Section 8 vouchers not because of the source of income, but rather as a response to the program itself. Section 8 requires the landlord hold a business contract with the Berkeley Housing Authority and to follow their rules for housing tenants. Unfortunately, there are too many horror stories floating about the BHA's response to difficult tenants as well as the inability to get out of the program once you're in. Until the federal program fixes the larger systemic issues, landlords will continue to remain skeptical of the program's value and won't participate.
Current Status: First reading of the ordinance was on July 25, 2017. The second reading is scheduled for September 12, 2017. If it passes on the second reading, the ordinance would likely start taking effect on September 26, 2017.
Tenant Opportunity to Purchase Act - STALLED!
Overview: In 2000, Washington D.C. adopted a Tenant Opportunity to Purchase Act which essentially gave sitting tenants first right of refusal when an owner put a rental property up for sale. Mayor Arreguin decided the City of Berkeley needed a similar program.
Proposal: The proposal is two-fold: it provides for a very specific process of first right of refusal for both Single Family Homes and multi-unit buildings. It is combined with a program that the city would administer to help tenants or tenant groups to finance the purchase of the property they rent.
Impact: The primary impact is one around the ability to put your property on the open market the minute you are ready to sell. The first right of refusal process gives the tenant up to 4 months to secure financing and work out any details specific to their ability to purchase. To see a visual of the process as it works for the purchase of a Single Family Home in Washington, click here.
BRHC Position: Right now we remain cautious on our position. This proposal is only in the beginning stages of being explored. It's worth noting that in Washington about 1,000 purchases have occurred over the past 16 years in a city of almost 690,000 people. The impact could be considerably less in Berkeley and at the end of the day, may not warrant worrying about.
Status: In February 2017, City Council directed the City Manager to research and pull a proposed Act together. We will update this website when the item comes back to City Council in the future.
Tenant Protection Ordinance - PASSED (but not yet implemented)
Overview: This is another proposal brought forward by (then Councilmember) Mayor Arreguin who consistently seeks any opportunity to set in place, anything he can that he feels protects tenants. This particular proposal follows suit of Oakland and San Francisco -- both of whom have in place Tenant Anti-Harassment ordinances.
Proposal: It was clear the proposal was an effort to reduce harassment that is purposely aimed at getting the tenant to vacate the unit so that the unit may be brought to market rate. It was designed to give the City Attorney power to decide on filing civil action against a landlord who has violated the ordinance.
Impact: For landlords operating in a manner that would not be deemed harassment under the definitions of this ordinance, there was little impact. For those that choose to use more forceful, threatening or harassing tactics to force a tenant out, this ordinance would provide a tenant with more paths to a civil suit. But as most policies do, it has left room for misinterpretation or a more broad definition of harassment which could impact an owner when they are dealing with a particularly difficult tenant. Additionally, there is no telling the City Attorney's capacity to take complaints of this nature or to follow through on civil action. Note: In July of 2017, City Council voted to give $300,000 over two years to the Eviction Defense Center and the East Bay Community Law Foundation so that they could help "file actions related to the Tenant Protection Ordinance."
BRHC Position: The Coalition's Executive Director was invited by (then CM) Mayor Arreguin to discuss and make suggestions around the ordinance. Her primary focus was centered around two important considerations. First, there must be a clear "pattern and practice of violation" by the landlord before the City Attorney may consider anything. This will help to minimize the problem that may arise when a tenant sees this as an opportunity to halt a viable eviction. Second is to make certain that there is a clause in the ordinance under General Remedies that requires the Tenant to properly notify the Owner or Agent of any issue of habitability prior to filing any civil action. Time and time again we have seen cases where a Tenant goes straight to Code Enforcement or the Rent Board to bring up an issue of habitability and the owner doesn't find out about it until the ball's been kicked way down the path. This will help to provide some protection to the Landlord in cases where the Tenant is abusing the Ordinance in their favor. The proposal did end up being inclusive of these suggestions.
Status: First reading of ordinance occurred on March 14, 2017. Second reading completed on March 28, 2017. This ordinance went into effect on April 12, 2017. You can view the proposed ordinance here. The City has yet to direct the Rent Board to create a form that the landlord would need to complete in order to be in compliance with the ordinance.
Policies that affect how you do business.
We will update you regularly on the policies, regulations and ordinances the City of Berkeley are considering or have made decisions on. The Coalition is represented at all city-related meetings where these policies are being crafted. We make public statements and encourage city leaders and commissioners to take all stakeholders into consideration during their process. You can help voice your opinion to elected officials. Learn how to speak out!
Berkeley Rental Housing Coalition
Amending the Relocation Ordinance - PASSED with amendments recommended by the BRHC
Overview: The Relocation Ordinance applies if a rental housing provider needs to temporarily vacate a rental property in order for repairs to be completed to bring the property into compliance with applicable building and housing codes. It was originally adopted in April 1986 to provide protections and relocation benefits for tenant households that were temporarily displaced due to code enforcement action. Since its adoption, it's been amended several times with the most recent amendment in October 2011. This amendment included a provision that specified the amounts for the various components of the relocation payments are to be updated and authorized by Council Resolution. Relocation payments are detailed in this Council Resolution.
Proposal: In November 2015 there was a large fire at 2449 Dwight Way in which multiple tenants were displaced. In interpreting the ordinance (as it applied to that particular situation), it was determined by the Rent Board and Housing Advisory Commission that "clarifying language should be added in order to make it easier to implement in the future." That led to City Council's current consideration which encompasses three points of clarification of the current ordinance. Two were minor changes and did not effect such things as payment amount to displaced tenants or an expansion of what constitutes a "covered" incident. The third was the addition of the clause "tenants are entitled to relocation payments...to the extent that relocation payments are not covered by the tenant's insurance." This clause permitted the landlord to deduct from money due to the displaced tenant, any amount the tenant may have received from their own policy. The Housing Advisory Commission was very split on the matter when recommending it to the City Council as some felt it created "two classes of tenants -- those that can afford insurance and those that can't." It was not clear how they felt this would impact the tenant in a negative way when it came to relocation reimbursements. Some HAC members wanted to "require" the landlord to hold relocation specific insurance but that did not make it into the final proposal to Council.
Impact: The most recent modifications of the ordinance have no impact of significance to rental property owners other than codifying what the city says is already happening (deduction of money received by the tenants insurance from total amount due to the tenant under the ordinance). However, the impact of the ordinance even from its prior format is considerable to any property owner that finds themselves in a situation where multiple tenants need to be relocated. Current per diem payments are $120 for a single person household, $135 for two and $166 for three per day. There is an additional dislocation allowance of $400 per tenant household, fixed payment for moving costs of $200 and fixed payment for storage costs of $200. It is unlikely that a landlord's building insurance would cover the provisions of a city-specific ordinance so it's important to check with your insurance company to see if an additional rider is needed.
BRHC Position: The Coalition did not have objections to the proposed modifications of the ordinance because they did not substantially change anything nor had an adverse affect on rental housing providers. We supported the codifying of a practice already in place with the addition of the renter's insurance clause. We do feel there are other aspects of the ordinance that warrant further clarification and ultimately, modifications. We believe that the ordinance even in its prior format prevents capital improvements from occurring because the building department is hesitant to declare that a relocation is necessary in order to complete the work.
Final Outcome: On February 9, 2016 City Council voted to adopt the first two modifications of the ordinance and rejected the new clause saying it needed more discussion at the HAC level. The BRHC spoke against their action but ultimately supported making the ordinance more clear. We spoke strongly against the potential requirement of owners to hold relocation insurance, noting that many owners have already attempted to gain the insurance and have been unable to find a carrier willing to write the rider. A second reading concluded on February 23, 2016. This ordinance went into effect on April 30, 2016.