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March 06, 2001

March 06, 2001

MINUTES OF THE REGULAR MEETING OF

THE SAN FRANCISCO RESIDENTIAL RENT

STABILIZATION & ARBITRATION BOARD,

Tuesday, March 6, 2001 at 6:00 p.m. at

25 Van Ness Avenue, Suite 70, Lower Level

    I. Call to Order

    Vice-President Marshall called the meeting to order at 6:16 p.m.

    II. Roll Call

                  Commissioners Present: Becker; Gruber; Hobson; Justman; Lightner; Marshall; Mosser; Murphy.

                  Commissioners not Present: Aung; Wasserman.

                  Staff Present: Gartzman; Grubb; Lee; Wolf.

    III. Approval of the Minutes

          MSC: To approve the Minutes of February 21, 2001.
          (Gruber/Becker: 5-0)

    IV. Public Comment on Whether the Board Should Go Into Closed Session

    Robert Pender objected to there being no general public comment section prior to the Board’s going into Closed Session.

    V. Vote on Whether to Go Into Closed Session Regarding the Case of Quigg v.
    Rent Board (Superior Court Case No. 316928) Pursuant to S.F.
    Administrative Code Section 67.11{a}

          MSC: To go into Closed Session. (Gruber/Justman: 5-0)

    VI. Closed Session re Quigg, supra, Pursuant to Government Code Section
    54956.9{a}

    The Board went into Closed Session from 6:19 to 7:11 p.m. with Deputy City Attorneys Marie Blits and Andrew Schwartz to discuss the case of Quigg v. Rent Board (Superior Court Case No. 316928).

    VII. Vote on Whether or Not to Disclose and Possible Disclosure of Any/All
    Conversations Held in Closed Session Regarding Quigg, supra
    .

          MSC: To not disclose the content of conversations held in Closed Session, except to provide an update as to the status of the Quigg litigation. (Gruber/Justman: 5-0)

    VIII. Report on Any Actions Taken in Closed Session Regarding Quigg, supra,
    Pursuant to Government Code Section 54957.1{a}{2} and S.F. Administrative
    Code Section 67.14{b}{2}

    Vice-President Marshall reported that the Board held a Closed Session to discuss the Quigg case with its attorneys. No actions were taken. She informed the public that Proposition H is still stayed pursuant to the Preliminary Injunction issued by Judge Robertson. If the Rent Board passes implementing regulations at this evening’s meeting, the City Attorney will schedule a hearing before the same Judge and ask that the Preliminary Injunction be lifted.

    IX. Remarks from the Public

    Robert Pender of the Parkmerced Residents’ Organization (PRO) informed the Board that the tenants at Parkmerced were affected by a fire that occurred close to where they live and park. Mr. Pender said that the "sense of community" felt by the residents was damaged by the way that management responded to the vandalism.

    X. Public Hearing

    The Board held a Public Hearing from 7:16 to 7:59 p.m. on proposed amendments to Sections 1.13, 7.10, 7.12, 7.13, 7.14 and 11.25 of the Rules and Regulations and proposed new Sections 7.19, 7.20, 7.21, 7.22, 7.23 and 7.24. The proposed amendments and additions concern landlord applications for certification of capital improvement costs and are intended to implement November 2000 Proposition H. Eighteen individuals addressed the Board as follows below:

      1. Landlord Teresa Gognio said that no pro-landlord legislation has been passed by the Board, and asked if the Board was totally for tenants. Ms. Gognio said that she is "trapped by rent control" and that it is hard to find skilled workers.

      2. Landlord Bill Alvarado told the Board that he has two units that his daughters currently live in. Mr. Alvarado said that when the units become available he would sell the building, because the economics aren’t warranted at 60% of CPI.

      3. Tenant Lorraine Calcagni of Lombard Place Apartments said that she hopes Prop. H is fair to small landlords. Ms. Calcagni said that the tenants at Lombard Place have had their rights denied at hearings before the Rent Board’s Administrative Law Judge. Ms. Calcagni reiterated that $8.4 million in costs is being passed through to the tenants in her building, which is "excessive", but there is no limit on passthroughs in the law prior to Proposition H.

      4. Tenant Helen Fellows at Lombard Place asked the Board to implement Prop. H. Ms. Fellows said that the tenants’ rents would double in five years, which will lead to displacement.

      5. Tenant Representative Jennifer Welch of St. Peter’s Housing Committee asked that the Board implement a Moratorium on the processing of capital improvement petitions, prior to the effective date of the Moratorium passed by the Board of Supervisors, since it is long-term tenants and seniors who are the most affected by capital improvement passthroughs.

      6. Tenant Juana Selena Televiz said that her landlord never repaired anything. Now that he has finally fixed a few things, he is seeking a rent increase for capital improvements. Ms. Televiz asked that the Board "be for tenants, and not for the landlords."

      7. Tenant Janis Winchester said she lives in a building which was paid off long ago, but the landlord wants to make improvements in order to sell. Ms. Winchester says that, due to the lack of affordable housing for seniors, there is no place for her to move. Since the public and the Board of Supervisors have spoken, Ms. Winchester believes it a "moral outrage" that the Board is not implementing a Moratorium.

      8. Landlord Peter Chen said that tenants who cannot afford to pay passthroughs should be protected by the Board’s hardship appeal provisions. Mr. Chen argued that the purpose of capital improvement work is to improve tenants’ living conditions, and that contractors do not work for free. Mr. Chen said that older buildings need the most work, but have the lowest rent paying tenants, and said that the recent earthquake in Seattle is a reminder of the need for capital improvements.

      9. Tenant Michael Barrett said that, over 25 years, he has paid over $125,000 in rent. Mr. Barrett maintained that upkeep and maintenance do not constitute capital improvements.

      10. Rebecca Logue-Bovee of the Housing Rights Committee said that there
      "needs to be fair play" and asked that the Board stop processing petitions.

      11. Tom Avicolli-Mecca of the Housing Rights Committee expressed his opinion that Proposition H does provide for hardship for small landlords and a fair return, and is fair. Mr. Avicolli-Mecca said that the need is to protect tenants who cannot afford to pay; and that a Moratorium is the only "decent, humane and moral thing to do."

      12. Ted Gullickson of the Tenants’ Union said that it has been 4 months since the voters spoke, which is "far too long" for the Board not to have passed regulations.

      13. Marina Franco, who is on the Board of the S.F. Apartment Association, said that the proposed regulations provide a zero rate of return for small and medium landlords, although larger landlords may get something. Ms. Franco believes that "fair rate of return" was added to Prop. H merely to "sound fair."

      14. Tenant Linda Rothfield said that the prior owner of her building failed to make repairs because he said he didn’t have the money. Now, the new owner is imposing banked increases and attempting to pass through capital improvements, even though he acquired the building in bankruptcy. Ms. Rothfield finds it unfair that the owner is giving increases only to those tenants he wishes to, which are those who complain.

      15. Tenant Carolyn Blair, who lives at the Northpoint Apartments and is with the Housing Rights Committee, said that her rent will go up $100 in 5 years just from annual rent increases. Ms. Blair said that even high-income tenants are moving out of her building. Ms. Blair feels that the hardship is on tenants, since landlords will always have a place to live.

      16. Tenant Arnold Cohn of Marina Cove Apartments said that there is an error in the Minutes of the meeting of February 21st because he spoke of a "tax-free" rather than "tax-deductible" gift that could be made annually. Mr. Cohn said that Angelo Sangiacomo and Herbert Jaffee are the reasons we’re all here. Mr. Cohn also believes that there is a problem in that Rent Board Administrative Law Judges have legal, but not construction, expertise; and they "understand pieces of paper, but not structures."

      17. New landlord James Carsant said that buildings have a certain life, and capital improvements must be performed in order to provide safer, better, more energy efficient housing. Mr. Carsant believes that government was set up to "protect the little guy from the rule of the mob", and that the Commissioners will need "testicular fortitude" in order to do unpopular things.

      18. Small landlord Ina Alvarez said that, if Proposition H survives, someone will need to put a cap on construction costs. Ms. Alvarez feels that there has to be something for small owners, and that "tenants can’t get it all."

    After the conclusion of the Public Hearing, several of the Commissioners made statements regarding the draft regulations. Commissioner Lightner said that it is unfortunate that Prop. H was drafted the way it was, since there is "little for property owners to support in these regulations." Commissioner Murphy expressed his belief that there is nothing the Board can do to these regulations to make them work; that the regulations do not function to provide rent increases for capital improvement costs; and that the Board is setting up a system for petitions that will fail. Commissioner Hobson said that he supported Prop. H, and had called for a Moratorium on the processing of capital improvement petitions on January 2nd. He also believes that the current law needs to be amended to provide relief for small landlords, and that these regulations are a "stop-gap measure." Commissioner Justman said that the Board has a duty and obligation to promulgate regulations to make Proposition H as workable as possible and that ultimately, it will be up to the courts to decide. Commissioner Gruber said that Proposition H was so poorly written, it would not benefit tenants; that the regulations are "unacceptable"; and that we have gone "many steps backward" in creating a process that is not beneficial to either side. The Board then passed the following motion:

          MSC: To pass the proposed regulations and submit them to the court with a request that the court lift the Preliminary Injunction on implementation of Proposition H.
          (Becker/Marshall: 3-2; Gruber, Lightner dissenting)

    XI. Old Business

    Fair Return/Implementation of Prop. H, Including Possible Implementation of a Moratorium on the Processing of Capital Improvement Petitions, Except for Seismic Work

    Commissioner Becker began the discussion by proposing that the Rent Board implement an immediate Moratorium on hearing and deciding capital improvement petitions, except for certification of seismic work, since it is unclear how long it will take for the Judge to rule on whether or not to lift the stay on Prop. H and tenants are being affected. Commissioner Justman said that he had spoken with Commissioner Wasserman about this issue. They concurred that nothing had changed since this issue was first brought up in January to cause them to reconsider what they felt were legitimate policy reasons for not enacting a Moratorium at that time.

    Commissioner Lightner responded that implementation of a Moratorium would be such a deviation from the Rent Board’s normal procedures that Rules changes and a Public Hearing would be required. Commissioner Becker said that Judge Robertson had left this question up to the Rent Board’s discretion, and it could be implemented as a Policy Directive to staff. Commissioner Murphy maintained that the Sunshine Ordinance requires specific language and a Public Hearing, while Commissioner Marshall asserted that this would constitute an administrative decision well within the Board’s powers.

    Commissioner Lightner then brought up recent changes by the Fair Political Practices Commission (FPPC) to the conflict of interest rules governing when an elected or appointed official can vote on matters in which they have an actual or potential economic interest. Commissioner Lightner was concerned that the Landlord Commissioners on the Board are dissimilarly situated from 90% of the landlords in San Francisco, in that they have pending petitions on file, and therefore they could be precluded from voting on a Moratorium. Deputy City Attorney Marie Blits told the Landlord Commissioners that they could receive legal advice from the ethics attorneys at her office and could recuse themselves from voting on the issue at this meeting if they felt uncomfortable. However, it was Ms. Blits’ opinion that it was the call of the Commission whether to formally amend the Rules and Regulations or just give direction to staff should a majority of the Board wish to implement a Moratorium. The Landlord Commissioners recused themselves as follows:

      MSC: To recuse Commissioner Lightner. (Lightner/Gruber: 5-0)

      MSC: To recuse Commissioner Murphy. (Murphy/Gruber: 5-0)

      MSC: To recuse Commissioner Mosser. (Gruber/Becker: 4-0)

    Commissioner Becker then made the following motion:

          MSC: That it be administrative policy to immediately stop hearing and deciding capital improvement petitions except those requesting certification of seismic work only. (Becker/Marshall: 2-2; Gruber, Justman dissenting)

    The Rent Board will therefore continue to process capital improvement petitions until the effective date of the Moratorium enacted by the Board of Supervisors, or April 1, 2001. The Board then briefly discussed how that Moratorium will be implemented with Senior Administrative Law Judges Sandy Gartzman and Tim Lee. Staff will provide the Commissioners with a more detailed proposal for how to implement the Moratorium for discussion at the March 20th meeting.

    XII. Consideration of Appeals

    A. 1135 Masonic Ave. #7 AT2K0244
    (cont. from 1/30-01)

    The tenant’s petition alleging an unlawful increase in rent from $1,017.00 to $2,100.00 was denied because the Administrative Law Judge found that the increase was justified pursuant to Costa-Hawkins. The tenant appealed on the grounds of financial hardship.

    The day before the Board meeting, the tenant submitted additional arguments in support of his appeal, including allegations that he resided at the rental unit pursuant to an agreement with an agent of the landlord, and therefore was not a subtenant subject to a Costa-Hawkins rent increase. Since there was no evidence that this submission had been served on the landlord, the Commissioners continued consideration of this appeal in order for staff to serve the landlord and provide an opportunity to him to respond, should he desire to do so.

          MSC: To deny the appeal. (Gruber/Justman: 4-1; Marshall dissenting)

    B. 4220 Cesar Chavez #429 AT2K0232
    (cont. from 1/30/01)

´

    The tenant’s petition alleging substantially decreased housing services was dismissed due to her failure to appear at the properly noticed hearing. On appeal, the tenant claimed not to have received the Notice of Hearing, and attached the requisite Declaration of Non-Receipt of Notice of Hearing. At the meeting on January 30th, consideration of this appeal was continued in order for staff to contact the tenant and obtain additional information.

          MSC: To recuse Commissioner Becker from consideration of this appeal. (Becker/Gruber: 5-0)

          MSC: To accept the appeal and remand the case for a new hearing. (Marshall/Hobson: 4-1; Gruber dissenting)

    C. 542 Mason #30 & 60 AT2K0237 & -43
    (cont. from 1/30/01)

    The landlords’ petition for certification of capital improvement costs to 19 of 34 units was granted, resulting in a monthly passthrough in the amount of $15.43. The tenants in ten units appealed the Decision on the grounds of financial hardship.

    At the meeting on January 30th, the Board voted to accept the appeals of the tenants in unit numbers 1, 20, 23, 50 and 55 and remanded those cases for a hearing on the tenants’ claims of financial hardship; and to deny the appeals of the tenants in unit numbers 52, 53 and 54. The appeals of the tenants in unit numbers 30 and 60 were continued in order for staff to obtain additional information.

          MSC: To deny the appeal of the tenant in unit #30 without prejudice to the tenant’s providing the requested information within 60 days, at which time the appeal would be re-opened.
          (Gruber/Lightner: 5-0)

          MSC: To deny the appeal of the tenant in unit #60.
          (Gruber/Lightner: 5-0)

    D. 1010 Bush St. #105 AT2K0230
    (cont. from 2/6/01)

    The tenant’s petition alleging decreased housing services because of the revocation of overnight guest privileges was denied because the Administrative Law Judge found that the right to have overnight guests was not included in the tenant’s base rent at the commencement of the tenancy, nor did the tenant pay additional consideration for this service at a later date. The tenant appeals, claiming that her case was not given adequate consideration by the Administrative Law Judge; that she never signed a lease or rental agreement restricting visiting hours; and that the revocation of overnight privileges was in retaliation for her having filed a petition at the Rent Board.

    At the meeting on January 16th, it was the consensus of the Board to continue consideration of this case in order for Commissioners Becker and Marshall to research the constitutional question of whether the tenant’s right to have overnight guests could be restricted; and for the Administrative Law Judge to address the issue of retaliation. After a brief discussion on January 16th, consideration of this case was again continued.

          MSC: To deny the appeal. (Lightner/Gruber: 3-2; Becker, Marshall dissenting)

    E. 1819 Golden Gate Ave. #12 AT010006

    The tenant’s petition alleging decreased housing services based on claims of inadequate security in the building and harassment by the landlord was denied, because the Administrative Law Judge found that the tenant had failed to meet his burden of proof. On appeal, the tenant maintains that the ALJ is racist and exhibited bias against him; that there are many factual mis-statements in the Decision; and that he was not provided ample opportunity to present his case.

          MSC: To deny the appeal. (Gruber/Lightner: 5-0)

    F. 2330 Larkin #32 AT010007

    The landlords’ petition for rent increases based on increased operating expenses was granted, resulting in 7% base rent increases to the tenants in twenty units. One tenant appeals the decision on the grounds of financial hardship.

          MSC: To accept the appeal and remand the case on the existing record to consolidate this appeal with outstanding appeal number AT2K0193, which is the tenant’s hardship appeal of a decision certifying capital improvement costs. (Lightner/Gruber: 5-0)

    XIIII. Communications

    The Commissioners received a new Commissioners’ Roster and the office workload statistics for the month of January, 2001.

    IX. Remarks from the Public (cont.)

    Robert Pender commended the Commissioners on the way they had handled themselves.

    XIV. New Business

    Commissioner Lightner introduced proposed amendments to Rules and Regulations Sections 1.21 and 6.15©(3). The definition of "Tenant" in Section 1.21 would be amended to require that the tenant occupy the unit as their principal place of residence in order to be covered by the Rent Ordinance. Section 6.15©(3) would be amended to require a Master Tenant to pay a proportionate share of rent for the unit. These proposals will be discussed at the March 20th meeting.

    XV. Calendar Items

      March 13,2001 - NO MEETING

      March 20, 2001
      10 appeal considerations
      Old Business:
      A. Fair Return/Implementation of Prop. H
      B. Proposed Amendments to Rules Sections 1.21 & 6.15©(3)
      New Business: Ellis Rescission

    XVI. Adjournment

    Vice-President Marshall adjourned the meeting at 9:30 p.m.

Last updated: 10/9/2009 11:26:12 AM