October 03, 2000p>
MINUTES OF THE REGULAR MEETING OF
THE SAN FRANCISCO RESIDENTIAL RENT
STABILIZATION & ARBITRATION BOARD,
Tuesday, October 3, 2000 at 6:00 p.m. at
25 Van Ness Avenue, Suite 320
I. Call to Order
President Wasserman called the meeting to order at 6:10 p.m.
II. Roll Call
III. Approval of the Minutes
IV. Remarks from the Public
Andrew Zacks, who represents the landlord at 22 Heather St. (AT2K0155) , took exception to the Administrative Law Judge’s memo dated September 27th. He requested that if the Board does not deny the appeal, that they continue the matter for two weeks so that he may formally respond.
V. Consideration of Appeals
A. 1670 Clay St. #5 AL2K0140
The tenant’s petition alleging a substantial decrease in housing services due to the conversion from landlord-provided steam heat to electric heat paid for by the tenant was granted, and the landlords were found liable to the tenant in the amount of $2,935.61, or $137.00 per month. On appeal, the landlords maintain that: the landlords are being penalized for having improved services to the building; the Administrative Law Judge erred in granting rent reductions during a period of time when there was adequate heat in the building; the result is prohibited by the Golden Gateway decision; capital improvement passthroughs petitioned for by the landlords are irrelevant and should not have been considered; the amount granted constitutes a windfall, results in an absurdly low rent and does not promote the policies and goals of the Rent Ordinance; and the Decision denies the landlords a fair return, is unconstitutional and constitutes a taking of the landlords’ property without just compensation.
B. 1670 Clay St. #7 & 8 AL2K0139
The tenant in unit #7 filed a petition alleging unlawful increases in rent; decreased housing services due to the conversion from steam to electric heat, which the tenant now has to pay for; and an allegation that the heat was inadequate when the electric heater was first installed. The petition was granted as to the conversion from steam to electric heat and it was found that the heat was inadequate for 7.3 months. The landlords were therefore held liable to the tenant in the amount of $1,963.95. Additionally, rent overpayments in the amount of $212.54 were determined to be owing from the landlords to the tenant. The tenants in unit #8 petitioned for a rent reduction due to the conversion and transfer of payment issue, and allege that the heat is dangerous and insufficient to heat the entire unit. These tenants also claim that the landlords have failed to repair peeling paint in the unit and otherwise failed to perform necessary repairs. The landlords were found liable to the tenants in the amount of $762.62 pursuant to the decreased services claims concerning the heat; the failure to repair claim was determined to have been untimely filed. The landlords make the same arguments in appealing this case as cited above concerning unit #5 at the same property in appeal number AL2K0140, additionally asserting that the lease for unit #8 makes payment of utility bills the tenants’ responsibility.
C. 736 Leavenworth St. AL2K0151
The landlords’ petition for certification of the costs of a seismic retrofit project was approved, in part. The landlord appeals the denial of certification of the costs of roof repair and pipe replacements, asserting that this work was incidental to the seismic retrofit project, and therefore should be considered capital improvements.
D. 1670 Clay St. #6 AT2K0153
The landlords’ petition for certification of capital improvement costs and rent increases based on increased operating expenses was granted, in part. The tenant in one unit appeals the decision on the grounds that: she did not have a full opportunity to present relevant evidence and argument at the hearing; the tenants should not have to pay for the costs of the electrical heating system until the landlords prove that a cited code violation has been abated; the cost of the exterior painting was greatly increased because of the deferred maintenance of the current owners; the cost of painting the lobby was inflated; the invoices submitted were of questionable validity; an argument regarding an illegal unit in the building was attributed to the tenants, when it was actually made by the landlords; and the Administrative Law Judge exhibited bias against the tenants and in favor of the landlords.
E. 747 Geary St. #102 AT2K0152
The landlord’s petition for certification of the costs of a seismic upgrade of the building, a new roof and new retaining wall was granted, resulting in a passthrough in the amount of $$122.35 to 16 of 22 units in the building. One tenant appeals the decision on the grounds of financial hardship.
F. 445 Webster #1 AT2K0154
The landlords’ petition for rent increases based on increased operating expenses for 11 of 15 units was granted, resulting in 7% base rent increases for all but 2 units. One tenant appeals the decision on the grounds of financial hardship. The tenant’s appeal was filed two weeks late because the tenant is suffering from AIDS.
The Commissioners continued consideration of this appeal so that staff can write the appellant and request clarification as to the actual number of tenants residing in the unit and have any additional adult occupant submit a Hardship Application. Staff was also instructed to send a copy of the landlord’s opposition to the tenant appeal to the tenant.
G. 22 Heather St. AT2K0155
The tenant’s petition alleging an unlawful rent increase to $2,000.00 per month pursuant to the provisions of Costa-Hawkins was denied. After the death of his mother, the original tenant of the unit, the tenant petitioner claimed that he had never vacated the unit, and was himself a tenant. The Administrative Law Judge found that the tenant had not resided at the unit between 1995 and the time of his mother’s death, and that he had therefore relinquished his tenancy. On appeal, the tenant asserts: that he never vacated or relinquished his tenancy at the subject unit; that although he established additional tenancies, he always considered the unit to be his principal place of residence; that the landlord accepted rent checks bearing his name; that the dates he gave at the hearing regarding the dates he occupied the unit are incorrect; and Costa-Hawkins is inapplicable to the facts of this case.
The landlord’s petition for certification of capital improvement costs to 9 of 12 units was granted. One tenant appeals the decision on the grounds of financial hardship.
The landlord’s petition for certification of capital improvement costs to 15 of 24 units was granted. Two tenants appeal the decision on the grounds of financial hardship.
The landlord’s petition for certification of capital improvement costs was granted. The portion of the petition asking for rent increases based on increased operating expenses was denied because the Administrative Law Judge found that the calculation periods used by the landlord created exaggerated results because the landlord had already received 7% base rent increases due to acquisition of the building. On appeal, the landlord claims that the Administrative Law Judge denied him due process by not raising her concerns during the hearing; that the increase granted in the first petition was based on increased property taxes resulting from the death of the prior owner, and that the current petition seeks an increase based on his purchase of the building, which constitutes two separate transactions; Rules Section 6.10(f) {the "anti-spec" clause} is inapplicable to the facts of this case because there were not two sales of the property but, rather, one sale and one transfer; and there are no "exaggerated results" because the increases in debt service and property taxes are permanent, and not one-time occurrences.
The landlord’s petition for certification of capital improvement costs to 8 of 12 units was granted. The Decision states that the landlord had chosen not to pass the costs of the new roof through to the tenant in unit #2 of the building. However, on appeal, the landlord’s representative informs the Board that this omission was a clerical error and asks to be allowed to amend the petition.
VI. Communications
In addition to correspondence concerning cases on the calendar, the Commissioners received a copy of a letter from the Director to Mr. John Artal in response to an earlier correspondence; a copy Senate Bill 1745; August Workload Statistics; and a revised staff roster.
The Director informed the Commissioners about this legislation, which will take effect on January 1, 2001. The legislation will require a 60-day notice for any rent increase that results in a tenant’s rent being increased in excess of 10% in any 12-month period. The ramifications of this include: rent increases that involve banked amounts, operating and maintenance expense increases and capital improvements, any of which may warrant a 60 notice if the increase alone or cumulatively results in the tenant’s rent being increased by more than 10% within a year. Mr. Grubb explained how the department will handle rent increase notices that do not conform to the new notice requirements; and outlined outreach efforts that should be undertaken to alert the public to this change. This item will be on the October 19, 2000 agenda for further discussion.
VIII. Calendar Items
October 10, 2000 - NO MEETING
October 17, 2000
11 appeal considerations
October 19, 2000
Special Meeting: Fair Return
IX. Adjournment
President Wasserman adjourned the meeting at 7:55
p.m.