1. Tenant Sharon Thornton said that the voters
passed Proposition H, and she doesn’t "understand the scrutiny."
2. Landlord Renee Lorda asked whether any consideration
would be given to the small property owner in terms of compensation for
maintenance.
3. Tenant George Buffington said that landlords
get a tax exemption for upkeep of their properties and that Proposition
H doesn’t demand old records, it merely provides landlords an opportunity
to obtain a fair return.
4. Tenant Michael Barrett said that landlords
receive a tax deduction for capital improvements; that fair return is
a subjective concept, whereas the law is supposed to be objective; and
that the Sunshine Ordinance demands that the Board waive their attorney-client
privilege.
5. Landlord Peter Euteneuer questioned the retroactive
application of Prop. H. Mr. Euteneuer performed substantial structural
work costing $600,000 on two buildings in 1998. He filed his petition
in December of 1999, and received his Decision before the Election but
after April 10th. He does not think it fair that Proposition
H applies to him.
6. Ted Gullickson of the Tenants’ Union said that
the issue is not whether Prop. H is a good idea. The law was passed over
two months ago, and it is incumbent upon the Board to pass regulations
as quickly as possible.
7. Rebecca Graf of the Housing Rights Committee
said that her organization is answering calls from tenants every day who
do not know whether to prepare defenses to capital improvement petitions
filed by their landlords. Ms. Graf said that the situation is confusing
for landlords as well, and that tenants are "scared."
8. Robert Pender announced the revival of the
Parkmerced Tenants’ Organization (PRO); the new President is Carolyn Cohn.
He told the Board it was their job to write regulations for Proposition
H.
9. Landlord Marian Halley said that Prop. H is
unconstitutional and can’t be made to work. She suggested "turning
our backs" on Prop. H, and having tenant and landlord groups come
together to write something fair to all and not "aimed at the economic
annihilation of landlords."
10. Spanish-speaking tenant Sara Perez expressed
her concerns about where she is going to live and said that she has been
waiting 3 years for subsidized housing.
11. Tenant James Mattern said that Prop. H passed
and should be enforced.
12. Tenant Arnold Cohn said applying the 1-year
T-bill rate on the gross rents of a building would guarantee a fair return;
that the landlord should be allowed to choose the base year; and that,
when there is a floor, there has to be a ceiling. He asked that the Board
stop holding hearings until this is resolved, but expressed his view that
"it can be done."
13. Tenant Lorraine Calcagni of 1360 Lombard said
that Prop. H was written because of the situation faced by the tenants
in her building, who have "been through hell and back." Ms.
Calcagni said that her landlord is charging $3,200 for a one-bedroom apartment
and $400 for a garage, and making unconscionable profits. She questioned
the whereabouts of 5.7 million dollars in missing subcontractor invoices
and asked that the Board give consideration to tenants in buildings where
the work was done prior to the passage of Prop. H.
14. Prop. I landlord Peter Holden asked whether
1978 or 1993 would be the base year for those buildings. He told the Board
that he didn’t get records from the prior owner when he purchased the
building, and that less than 10% of the buildings in San Francisco are
covered under the seismic retrofit standard in Prop. H.
15. Tenant Ann Doherty of the Marina Cove Tenants’
Association said that stopping hearings, payments and accruals is the
only sensible response to the Stay on Prop. H. She said that no tenant
in her building would settle with the landlord in light of Prop. H.
16. Tenant Jan Bulechek of Marina Cove said if
tenants are going to have to wait for implementation of Prop. H, the Rent
Board should wait to hold hearings. She noted that it is hard for tenants
to sustain a defense against a large landlord and said that the whole
thing may be "moot."
17. Tenant Jose Morales told the Board to honor
the will of the voters and said that "greedy landlords are creating
huge social problems for the City." Mr. Morales believes that San
Francisco should be an "eviction-free" city.
18. Tenant Robert Gordon told of his "shock"
at receiving notice of a capital improvement hearing after Prop. H had
passed. He doesn’t believe tenants should be assessed for "owners’
responsibilities", since landlords receive tax breaks, appreciation,
and rent.
19. Landlord James Lew said that a fair return
analysis should be based on the current market value of the property rather
than 1978.
20. Landlord Bill Quan said the Board should be
focusing on passing fair regulations, instead of passing regulations as
quickly as possible. Since "many different variables" need to
be taken into account, he suggested that the Board hire real estate, investment
and economic professionals to come up with more than one "fair rate
of return."
21. Landlord Sue Chang said that she called the
prior owner of her building, who laughed when asked if she had records
from 1978. She said that landlords can’t write off the cost of improvements
if there’s no profit on the building. She expressed her dismay that there
are "so many tenants with hateful feelings toward their landlords",
and submitted a copy of a letter from one of her tenants asking that the
Board provide an incentive for landlords to maintain their buildings.
22. Dave Chelsea-Seifert, Housing Specialist with
the Tenderloin Housing Clinic, said that his job is to find housing for
low-income, working families. He said that his clients will face extreme
hardship if the Board delays.
23. Landlord Robin Levitt said that she is not
opposed to Prop. H. However, prior to passage of the Initiative, she used
to be able to pass on costs equally. Now, she says that her new tenants
will be subsidizing the long-term tenants, and that the burden should
be distributed more fairly. She asked that any new regulations be easier
to follow than the old ones, and said that it took 9 months to get approval
for a $30 passthrough.
24. Janan New, Director of the S.F. Apartment
Association, said that Prop. H was "poorly drafted" and impossible
to incorporate into the Rent Ordinance. She suggested that representatives
of the landlord and tenant communities get together to draft a compromise.
25. Tenant Angelique Duvall said that landlords
should be able to get annual increases to cover the cost of operating
the building. Since annual increases used to be 4%, and now are only 2.9%,
Ms. Duvall said that she’d "go for 10%" too if she were a landlord.
26. Landlord Representative Al Goodwin said that
there is "no way that this can be implemented legally or fairly."
He said that if capital improvement passthroughs are eliminated, interest
on funds borrowed should be allowed as an operating and maintenance expense.
27. Landlord Karen Crommie asked that when the
Board enacts regulations, it remember the concerns of small landlords.
She said that she and her husband bought their building for their retirement,
and that all their savings are in that building. Her suggestion was to
eliminate rent control, in which case there would be no passthroughs.
28. Landlord Scott Hall said that he can’t do
planned structural work because of the passage of Prop. H. If he adds
bedrooms to the other two units in his building, he’s "adding housing",
but won’t be able to raise the rent. He considers this "a new low."
Since Mr. Hall is a CPA, he said he is available to tenants for consultations
on tax deductions.
29. Landlord Dan Forkin said that he has always
effectuated capital improvements without filing petitions, because he
considered it his responsibility, and he "did ok on vacancies."
However, since annual increases are "no longer sufficient",
Mr. Forkin feels that every option is now closed and that property ownership
is "too great a risk."
30. Landlord Gary Briggs owns a 1907 building
which needs "lots of upkeep and maintenance." Mr. Briggs feels
that it’s not fair that the "only way to recover costs" is to
charge higher rents to new tenants.
31. Landlord Attorney Nancy Lenvin said that no
regulation will "save Prop. H from constitutional infirmity."
She does not believe that an MNOI standard can be grafted on to an existing
rent control ordinance, nor that Prop. H deals with fair return on added
capital. She considers Prop. H to be an "administrative, regulatory
and financial nightmare", even if it’s facially constitutional.
32. Landlord David Crommie said that his tenants
make 3 times what he makes, and that they’ll never move. Mr. Crommie’s
"minimal capital improvement" is being "yanked out from
under him." Mr. Crommie believes that there are greedy landlords,
but there’s also such a thing as a greedy tenant.