San José council approves plan to strengthen rent control

Mercury News September 1, 2015

SAN JOSE — In a victory for renters struggling to stay afloat in Silicon Valley, the City Council on Tuesday approved a plan to strengthen the city’s rent control laws and bolster tenant protections.

The council voted 9-2 to explore reducing the current 8 percent annual allowable rent increases under the city’s rent control law and modifying an option that allows new property owners to pass mortgage costs to renters. Councilman Donald Rocha and Councilwoman Magdalena Carrasco voted against the plan.

City staff also will look into creating a “just cause” ordinance to prevent landlords from evicting renters without cause to bring in new tenants to pay higher rents. Councilman Raul Peralez, who first proposed strengthening rent control in May, urged the council to expand the 1979 law to include more housing.

San José’s rent control only covers about 43,000 units built before 1979 and excludes duplexes. Housing built after 1995 is exempt from rent control under the state’s Costa-Hawkins Rental Housing Act, so that leaves apartments built from 1979 to 1995 and all duplexes with no protections.

At the request of Peralez, the council directed staff to research the possibility of expanding rent control to include duplexes. The council also decided to establish an advisory task force of landlords and renters to discuss rent control policies, as suggested in a memo by Councilman Johnny Khamis and Vice Mayor Rose Herrera.

Khamis, who defended property owners’ rights to evict problem tenants, pushed for income requirements on rent control units to prevent abuse. Despite hesitation from some council members, the majority agreed to explore the idea of income-eligibility requirements.

During the lengthy meeting Tuesday, landlords and renters faced off, with each side sharing emotional stories of struggle and inequality. Tenants said the growing divide between the rich and the poor is forcing them into homelessness amid skyrocketing rents.

“I live in a hotel that I can barely afford to pay,” said Martha Munoz, 50. “Please, I beg you guys. Open your hearts and lower the rents. Otherwise, all of us will be living in the gutter or dead.”

Emerald Ip said she had a roof over her head when the City Council first discussed rent control a few months ago. Now the 20-year-old is homeless, couch surfing and staying with friends. Ip was accepted at San Jose State, but her housing situation derailed her plans to attend college.

“We try to be good kids and go to school, but we can’t if we don’t have a place to live,” Ip said. “We want to work hard and contribute. Right now, the odds are stacked against us. Please don’t forget us.”

But landlords said rent control won’t increase affordable housing in San José. They argued the law reduces the number of units and makes it difficult to invest in properties.

“It hasn’t worked in other cities. Why would it work in San José?” said Richard Matthews, adding that rent control reduces units and increases evictions. “Owners convert properties to other uses when they make better profit.”

City staff will begin public meetings with landlords and tenants this month. The updated rent control ordinance is expected to be reviewed by the City Council in January.