July 02, 1996

I. Call to Order

President Becker called the meeting to order at 5:40 p.m.

II. Roll Call

Commissioners Present: Becker; Gruber; Marshall; Palma.
Commissioners not Present: Bierly; Wasserman.
Staff Present: Grubb.

Commissioners Moore and Mosser appeared on the record at 5:41 p.m.; Commissioner Lightner at 5:46 p.m.; and Commissioner Murphy at 6:07 p.m.

III. Approval of the Minutes

MSC: To approve the Minutes of June 18, 1996.
(Marshall/Palma 4-0 )

IV. Remarks from the Public

Robert Pender spoke about the form used by the school district for exemption for seniors from Proposition B and expressed his concerns about the privacy of the information requested. Attorney Nancy Lenvin distributed a proposal for revisions to Rules and Regulations Section 6.14.

V. Consideration of Appeals

A. 1039 Page St. Q001-59A

The landlord’s petition for certification of the costs of repair to the back porch and stairs, foundation work and exterior painting was granted, in part. The work on the back porch and stairs was found to be in the nature of repair, rather than capital improvement, and the hearing officer disallowed $6,119.45 in claimed costs for the foundation because the landlord failed to submit adequate documentation. On appeal, the landlord submits three additional canceled checks which he maintains support his claimed cost; and asserts that the hearing officer erred in determining that notices of rent increase were null and void due to having been sent prior to the petition having been filed. Rather, the landlord states that he delivered the notices to the tenants on his way home from the Rent Board office after having filed the petition.

MSC: To accept the appeal and remand the case to the hearing officer on the record to allow the hearing officer to consider the owner’s statement as to the time of delivery of the notice and to permit the tenants 15 days to respond to the statement. The case is also remanded on the record for consideration by the hearing officer of the checks submitted with the appeal as proof of payment for the rear stairs repair.
(Lightner/Gruber: 5-0)

B. 99 Jersey St. #7 Q001-60A

The tenants’ petition alleging an unlawful increase in rent was granted and the landlords were found liable to the tenants in the amount of $2,662.45 due to a rent increase based on vacancy decontrol that was given to a subtenant upon the original tenant no longer permanently residing in the unit. The hearing officer found that the landlords knew of the presence of the subtenant in the unit and, although they may have mistakenly believed that the original tenant still resided on the premises and/or believed or were led by the tenants to believe that the subtenancy was to be temporary, they were still required to serve the tenants with a notice pursuant to the requirements of Section 6.14 of the Rules and Regulations. On appeal, the landlords argue that: the Board has no jurisdiction over this case because the original tenant was no longer residing in the unit at the time the petition was filed; the tenants’ petition constitutes an abuse of process because the subtenant gave a notice of termination of tenancy the day after filing the petition; "subletting" is a legal issue not properly before the Board; the hearing officer demonstrated bias towards the tenants by allowing submissions after the close of the record and granting them extra time to submit documentary evidence, although they were represented by counsel; Rules and Regulations Section 6.14 is inapplicable to the instant facts; the parties resolved this matter among themselves three years ago with terms favorable to the tenant; and the landlords should have been given credit for a $10.00 rent increase that was noticed but not collected.

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

C. Northpoint Apartments Q001-67R thru Q002-02R

The landlord’s petition for certification of capital improvement costs in the amount of $1,196,133.51 to the tenants in 268 of the 514 units in the complex was granted, in part, resulting in a monthly passthrough in the amount of $31.32. Thirty-five tenants appeal the decision, three on the grounds of financial hardship. The tenant-appellants assert that the costs should be disallowed because the work consisted of "luxury improvements not in keeping with the socioeconomic status of existing tenants" in accordance with Rules and Regulations Section 7.15; and that the upgrades were performed in order to attract and retain corporate, executive and vacation tenancies rather than to benefit long-term residential tenants.

MSC: To deny the appeals except for that of tenant James Butler at 2310 Powell #303, which shall be remanded for a hearing on the tenant’s claim of financial hardship.
(Lightner/Gruber: 3-2; Becker, Marshall dissenting)

VI. Communications

The Commissioners received the following communications:

A. Several letters concerning Rules and Regulations Section 6.14.

B. A letter from landlord Martin Gumbel concerning the inadequacy of the amount of the annual allowable increase.

VII. Old Business

A. Rules and Regulations Section 6.14 (Costa-Hawkins Bill)

Commissioner Wasserman’s proposed revision of Section 6.14 was discussed along with Ms. Lenvin’s proposals, and the below motions were made:

MSC: To adopt Commissioner Wasserman’s version dated June 28, 1996, with the addition of the word "tenancy" between the words "oral" and "agreement" in (a)(1).
(Marshall/Becker: 3-2; Gruber, Lightner dissenting)

MSC: To make Commissioner Wasserman’s memorandum dated July 2, 1996 concerning Rules and Regulations Section 6.14 part of the record as a policy statement of the Board.
(Lightner/Palma: 3-2; Becker, Marshall dissenting)

MSF: To make the adopted amendment to Rule 6.14 retroactive to January 1, 1996.
(Lightner/Gruber: 2-3; Becker, Marshall, Palma dissenting)

B. Extended Amortization Schedules for Seismic Work

Commissioner Marshall indicated that staff had proposed some changes to her draft proposal to extend amortization periods for seismic renovation work to thirty years. Commissioner Murphy stated his belief that the proposal conflicts with the Unreinforced Masonry Building (UMB) Ordinance with respect to the limitations on the passthrough amounts permitted. Commissioner Marshall will review the UMB Ordinance on this matter.

IV. Remarks from the Public (cont.)

Members of the public made comments as follows: drafts of proposed amendments should be distributed as quickly as possible to permit timely responses by the public; an interpretation of the applicability of revised Rule 6.14 to a specific situation was requested; a query was made as to the scheduling of the Public Hearing on proposed amendments to Rules Section10.10 regarding the issue of constructive notice; a comment on the financial hardship that the cost of the UMB work imposes on some tenants was made; a concern was raised that amended Rule 6.14 was confusing; it was requested that deleted language be included when printing a proposed Rule change; and a request for a copy of Board policies was made.

VIII. New Business

President Becker spoke of the pending termination of staff member Roger Levin due to the return of another staff member to the position. President Becker asked that the Board indicate its support for a departmental request for an additional position that would allow the department to retain the services of Mr. Levin. Executive Director Grubb stated that the department has received numerous letters in support of Mr. Levin and his efforts as a staff member. The Commission indicated by consensus its support for the request of an additional counselor position.

IX. Calendar Items

July 9, 16, 23 & 30, 1996 - NO MEETINGS

August 6, 1996
2 appeal considerations (1 rescheduled from 7/23/96)
Public Hearing: Proposed Amendments to Rules Section 10.10 Regarding the Issue of Constructive Notice
Old Business: Extended Amortization Schedules for Seismic Work

X. Adjournment

President Becker adjourned the meeting at 9:10 p.m.