With a unanimous 13-0 vote the Los Angeles City Council voted to extend the City’s Foreclosure Eviction Ordinance to protect tenants living in rental properties not subject to the City’s Rent Stabilization Ordinance (RSO) from eviction on the grounds of foreclosure for another two years. Tenants living in rent controlled units have had these protections.
Multi-family rental units built after 1978 and all single-family home rentals are not subject to the City’s rent control law.
The Ordinance extension approved on December 15, 2015 prohibits lenders from evicting any tenants in the City merely because of foreclosure on their landlords.
The law requires landlords seeking to recover possession of a rental unit from a tenant, must comply with all the RSO requirements and provisions for eviction, including the payment of relocation fees for no-fault evictions. Since the passage of the Ordinance, more than 59,000 properties containing over 79,000 units have been foreclosed on in the City.
The Foreclosure Eviction Ordinance was originally passed on December 17, 2008 and was nation’s first Foreclosure Eviction Moratorium. It has been extended every year since in response to a national crisis that has not subsided.
The Coalition for Economic Survival (CES) advocated for the original law in 2008 and every extension since then.
CES Executive Director Larry Gross stated, “The foreclosure crisis and its impact on hardworking Americans is a national disgrace. It’s especially unjust for the forgotten victims — tenants.
They’ve done nothing wrong. Paid their rent on time. But, without this protection these heartless banks could evict evict them simply because they’re living in foreclosed rental property.
Gross went on to say, “We applaud the Council in providing national leadership by enacting the strongest tenant foreclosure protections in the country. It provides tenants with a little bit of hope and justice. This action is an action needed to help keep these banks accountable. It truly is a tenants’ rights victory.”
The LA Housing and Community Investment Department Foreclosure Registry data for 2015 indicates that the foreclosure crisis continues to affect City residents and neighborhoods. A total of 10,381 properties were registered in the City’s Foreclosure Registry from January through November 8, 2015, comprised of 4,273 first time property registrations and 6,108 re-registered properties (with a notice of default and/or foreclosure from 2014). This reflects a ten percent increase from 2014 registrations, which totaled 9,431.
When San Francisco apartment house owners retrofit their buildings, the entire cost will be passed on to their tenants. City Councilman Gil Cedillo has promised that won’t happen in Los Angeles. Today, his committee is taking up what could be the most extensive retrofitting requirements in California history. Who should bear the cost of making those buildings earthquake safe?
We need to address the threat of earthquake,” says Larry Gross, executive director of the renters rights group Coalition for Economic Survival, “but we don’t want to create an economic earthquake for a tenant who won’t be able to afford this increase and will likely be displaced from their home.”
It could cost up to $130,000 to extensively inspect — including partially dismantling — and then strengthen each building. A landlord’s group puts the cost at about $5,000 for a single unit. Under the approved ordinance, owners can pass the entire cost on to renters over a five- to 10-year span.
Gross, of the Coalition for Economic Survival, says that while this is the worst time to allow citywide rent increases, reality suggests $38 is a good compromise.
“Clearly, given the situation where tenants in this city are now mostly paying unaffordable rents, and most are paying upward of 50 percent of their income to rent, we don’t like the idea of one more dollar in rent,” Gross says. “The fact is that right now the current law states tenants could be hit with upward of a $75 increase and would have to bear the burden of the retrofit costs. One hundred percent could be passed on. That’s a fact.”
Based on the $38 monthly maximum, the average L.A. tenant would see an increase more like $18, for a range of $1,800 to $3,800 in hikes if somebody rents in L.A. for a decade.
“This proposal definitely strives to establish some degree of equity in regards to who pays for the costs,” Gross says. “We’re doing everything we can to try to soften the blow, because we’ve seen the blow coming.”
LOS ANGELES (CBS) — The Los Angeles City Council Housing Committee considered a Housing and Community Development Department proposed compromise in which building owners and renters would share the financial burden equally of earthquake retrofit cost that will be mandated for some 13,ooo concrete and soft story apartment buildings in Los Angeles. Under the plan, tenants would face rent increases over a 10-year period, with a maximum increase of $38 per month.
KNX Newsradio’s David J. Singer talks with Coalition for Economic Survival Executive Director Larry Gross on the impact this could have on tenants.
Gross said, “Clearly everyone wants to see these buildings made safe. But the key question here is who pays, how much and for how long.
KPCC AirTalk Radio Debate on Who Should Pay for Earthquake Retrofitting With CES Executive Director Larry Gross
According to an L.A. Times article, Councilman Gil Cedello said the way costs ought to be shared required further review. Officials from the Los Angeles Housing Department recommend a cap for rent hikes at $38 a month for five or more years to cover the costs of retrofitting.
How do you think the cost should be handled among tenants and property owners?
KPCC’s AirTalk With Larry Mantle – Program Aired Thursday, September 17, 2015.
Larry Gross, executive director Coalition for Economic Survival, a tenant advocacy group
Jim Clarke, Executive Vice President of Apartment Association of Greater Los Angeles
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.