Matthew Jacobs is the Chair of the California Housing Finance Agency, a state agency with a mission to support the needs of renters and home-buyers by providing financing and programs that create safe, decent and affordable housing opportunities for low to moderate income Californians.
Matthew Jacobs is also a developer who recently acquired four rent controlled apartment buildings in the Beverly Grove and Fairfax areas of Los Angeles. Jacobs is evicting 17 families living in these buildings under the dreaded state Ellis Act to build 19 4-story houses under the city’s Small Lot Sub-Division Ordinance that will each sell for well over $1 million.
“That gets me, too. I mean, the fact that we have very little affordable housing, and they’re not adding to it,” said Tenant Leader Steven Luftman.
Tenants facing eviction and their supporters protested in front of their landlord’s home, assisted by Coalition for Economic Survival, on May 27. Ironically, Jacobs lives blocks from the buildings on North Flores he’s demolishing.
In a phone response to a KPCC radio reporter’s question regarding the tenants’ protest in front of his home, Jacobs responded, “To build denser LA, some people need to be displaced.”
The Ellis Act is a California law enacted in 1985, which ostensibly allows landlords to “go out of business” and evict tenants in rent-controlled properties.
Alarmed by the rash of Ellis evictions like Jacobs’ projects and the
resulting destruction of historically significant housing stock, the Mid City West Community Council, a City-certified neighborhood council, voted unanimously to ask the City Council to forbid demolitions in Beverly Grove and other nearby areas until new regulations can be passed to protect the tenants and the buildings in which they live.
“I’m a widow and a senior citizen, being displaced from my home of twenty-two years;” said Cynthia Cohn. “Apartments in my neighborhood are fifty percent more expensive, and none accept dogs.”
The historic buildings facing demolition are 118 through 124 North Flores Street and 750 through 756 North Edinburgh Avenue.
Since 2001 the City of Los Angeles has lost nearly 19,000 rent controlled affordable housing units due to the Ellis Act, according to the LA Housing and Community Investment Department.
Luftman stated, “My message (to other tenants) is to get active now.”
Tenants and the Coalition for Economic Survival are urging people to contact Governor Jerry Brown to demand that he remove Matthew Jacobs from the California Housing Finance Agency. Given that Jacobs is destroying affordable housing and displacing low income and working tenants to build housing for the rich, they believe that this man has no moral right to sit on the board of an agency dedicated to providing affordable housing for the people of California.
Contact Governor Brown at 916-445-2841 or by email to tell him to remove Jacobs now.
Landlords cleared out 725 apartments in 2014, compared to 308 the year before.
The Ellis Act, passed by the state legislature in 1985, allows landlords to get out of the rental business by evicting their tenants from rent-controlled buildings, so long as they either sell the building, convert the units into condominiums, or let the building sit vacant for a minimum of five years.
Landlords don’t typically use the Ellis Act to sell their property when the real-estate market is weak. When the market is strong, they can cash in. Not surprisingly, the data from the city shows that Ellis evictions were highest when the the housing market was strong. As the housing market rebounds in Los Angeles, Ellis evictions, once again are on the rise.
“A lot of these landlords are seeing this as their way out of the market, and this is a quick and easy way to do it,” says USC’s Raphael Bostic.
“Every rent-controlled tenant should be worried,” warns Larry Gross from the Coalition for Economic Survival, “and it’s going to get worse.”
Gross says many of these evictions are happening in a Nike “swoosh” shape across Los Angeles – they span from Venice, cut through Hollywood and Koreatown, and encompass parts of Silver Lake and Echo Park. There is also a hotspot in the San Fernando Valley around Sherman Oaks, Studio City and Valley Village, which he says affects many who work in the entertainment industry.
Recent Ellis Act evictions are still are far cry from a peak in 2005 when landlords cleared out 5,425 units. However, Bostic says to expect numbers to climb in the coming years because of the strong housing market in Southern California, where demand greatly exceeds supply.
“This is just another sign that there’s real pressure in affordable housing in Los Angeles,” he says.
The landlord group, Apartment Association of Greater Los Angeles (AAGLA), is urging that the Mayor and LA City Council take action to have renters pay their own water bills. This would be a significant change given that for most tenants’ water costs are included in their rent.
Because it’s included in the rent, landlords claim that tenants have no incentive to conserve water, thus have little concerns about letting their faucets run and not reporting leaks. As a result, landlords say they are facing increased water bills.
However, the LA Department of Water and Power reports that the City has cut water use about 10% since early last year and is on track to comply with Mayor Eric Garcetti’s order to slash consumption by 20% by 2017.
Given that approximately 65% of LA residents are renters, these water conservation achievements could not have been obtained without significant participation of tenants throughout the City.
Nevertheless, we all have a responsibility to conserve water. This is a real crisis that requires tenants, landlords, homeowners and businesses to all do their part.
The AAGLA plan appears to be nothing more than another landlord scheme, which clearly is an attempt to take advantage of our water drought crisis to shift financial responsibilities to tenants who can least afford to pay more.
This plan is disingenuous and opportunistic and is more about attempting an end-run around existing rent control laws and tenant protections in order to get more money from tenants.
Los Angeles has become the nation’s most unaffordable city for renters. Many renters are already paying unaffordable rents, paying upwards of 50% of their income to maintain a roof over their heads. This proposal would make our affordable housing crisis worse.
The landlords’ plan is essentially an arbitrary water allocation and billing practice referred to as Ratio Utility Billing System or “RUBS”
RUBS allows the landlord to charge for water use by some ratio like the number of residents in the unit, the number of bedrooms or perhaps by the square footage. All of these systems assume constant and equal water usage based on the arbitrary ratios. But, without sub meters for each unit, chances are that water use and charges will be inaccurate, with some tenants ending up overpaying for their usage and some underpaying.
It is unclear whether tenants would be responsible for the cost of the landlord watering lawns, or operating water-inefficient washing machines, or cleaning the property common areas.
Plus, it would include the controversial use of a 3rd party bill collector, which would mean additional administrative costs to tenants above and beyond the water charges.
There have been problems where RUBS is currently being used. Some landlords have marked up the cost of water to their tenants creating a hidden rent increase in the guise of water billing.
This system provides a substantial incentive to landlords to avoid making needed repairs. What Coalition for Economic Survival (CES) organizers have found in assisting renters is that landlords, in many cases, refuse to fix leaky toilets or faucets or repair broken pipes waste a lot of water. This proposal would increase landlords’ lack of interest in making needed repairs.
LA Mayor Eric Garcetti says he only supports tenants paying for their water usage if they have their own water meters.
“I’ve been supportive of individual meters so individuals could track their own use,” Garcetti said.
LA City Council Member Mike Bonin agreed, stating, “The only way to do it is with individual meters. As a drought-fighting tool, you need to have the use tied directly to the cost.”
Also, landlords should be required to make their apartments building water efficient by converting their lawns to drought resistant plants, installing energy/water efficient washing machines, and providing their units with low-flow toilets and faucets without passing those costs on to tenants. There should be stiff fines to landlords and increased rent reductions to tenants when landlords fail to make quality repairs to leaks in a timely manner.
The installation of sub meters in buildings could be studied, ensuring that tenants would be charged only for what they use. But there would have to be a corresponding reduction in rent to accurately compensate tenants the full amount of savings to landlords.
Story by Larry Gross
Tenants Facing Ellis Act Evictions at the historic Villa Carlotta Apartments received support for their “Hug the Carlotta” Protest from the Coalition for Economic Survival (CES), students from The Oakwood School and Community Groups and Residents on April 21, 2015.
Last Christmas, CGI Strategies, the new owners of the Villa Carlotta Apartments in Hollywood provided their tenants with presents in the form of eviction notices. Using the provisions of the state Ellis Act, which allows landlords to remove units from the rental market and evict tenants, the owners served tenants with 120-day eviction notices. The eviction notices expired on April 21, 2015.
The owners have stated that they want to convert the building into a short-term luxury hotel. Tenants, many who have been long-term renters there, have been under severe pressure to accept payouts to move earlier than the eviction date. A number of tenants have succumbed to the pressure and have moved.
The rest of the tenants have fought back, claimed that owners have no much higher rents. This would violate the provisions of the Ellis Act by re-renting the units within 5 years after falsely forcing tenants out.
The tenants have been gaining community support. They have been assisted by the tenants’ rights organization, the Coalition for Economic Survival. Recently, students of The Oakwood School‘s senior theatre class became aware of the Villa Carlotta’s plight while preparing a play that echoed the Carlotta’s story. Determined to help the residents keep their homes, students and tenants recently spoke before the LA City Council, asking Council Member Tom LaBonge, who represents the district Villa Carlotta is located in, to intervene on their behalf.
With their pleas to the City going unanswered, the tenants, students and community supporters stood together on the day of their eviction notice states they need to vacate and collectively hugged the building in a visual demonstration and show of solidarity to protest and stop the evictions. The Oakwood School theatre students also performed a reading from the play “Hot l Baltimore” after the action in the lobby of the Villa Carlotta.
In addition there was a representative from UNITE-HERE Local 11 (two members of the union reside at Villa Carlotta), the Hollywood United Neighborhood Council and tenants from the Rodney Drive Tenant Association who are also facing Ellis Act evictions from their Los Feliz apartments.
Villa Carlotta Apartments has had a storied past. The four story building on the northwest corner of Franklin and Tamarind was designed by Arthur E. Harvey for the estate of early filmmaker Thomas Ince. One of the building’s most famous long-time tenants was gossip columnist Louella Parsons, who wrote her column from her apartment there. Other past tenants in the 50-unit building included actor Edward G. Robinson, producer David O. Selznick, actress Marion Davies, architect Wallace Neff, Neil Patrick Harris and lead vocalist Dan Reynolds of the rock group Imagine Dragons, who wrote a hit record there, and whose wife and child attended the protest.
Story by Larry Gross
Coalition for Economic Survival’s Response to LA Mayor Eric Garcetti’s Speech on his Housing Plan for Los Angeles
The Coalition for Economic Survival (CES) believes what was important about the LA Mayor Eric Garcetti’s speech given at the Mayoral Housing, Transportation and Jobs Summit at UCLA on October 29, 2014, was the recognition that we need to link the commitment to providing new affordable housing with raising the minimum wage.
For low wage earners providing one without the other is an inadequate formula. Without the wage increase one can’t afford the housing, and without the affordable housing a wage increase will only go to the landlord.
The other important commitment made by the Mayor was the need to preserve existing affordable housing in addition to producing new affordable Units, as well as protecting the city’s rent control law and tenant protections.
Over 13,000 rent controlled units have been lost in the City since 2001 as a result of developers using the Ellis Act to convert and demolish these units and build high-priced condominiums and apartments.
If we don’t preserve the existing affordable units then no matter how many units are built they won’t meet the need. We will never build our way out of our affordable housing crisis unless there is an equal commitment to preserve existing affordable housing.
The Mayor also committed to building 100,000 housing units by 2021. Most of these units need to be affordable units.
In a City where the majority are renters and most of those renters are currently paying unaffordable rents, CES applauds the Mayor’s stated commitment to ensuring that there is adequate affordable housing for the people of Los Angeles.
It is going to take this type of leadership, commitment and creativity to truly achieve real equity and economic justice in Los Angeles.