January 08, 2002p>
MINUTES OF THE REGULAR MEETING
OF
THE SAN FRANCISCO RESIDENTIAL
RENT
STABILIZATION & ARBITRATION
BOARD,
Tuesday, January 8, 2002 at 6:00 p.m.
at
25 Van Ness Avenue, Suite 70, Lower Level
I. Call to Order
President Wasserman called the meeting to order at
6:15 p.m.
II. Roll Call
Commissioners Present: Aung; Becker;
Gruber; Lightner; Marshall; Mosser; Wasserman.
Commissioners not Present: Hobson; Justman.
Staff Present: Grubb; Wolf.
Commissioner Murphy appeared on the record at 6:36
p.m.; Commissioner Mosser went off the record at 8:21 p.m.
III. Approval of the Minutes
MSC: To approve the Minutes of December 18,
2001 with the following correction: to reflect that the motion regarding
the case at 735 Geary St., Apt. 504 (AT010179) was made by Commissioner
Becker and seconded by Commissioner Aung.
IV. Remarks from the Public
A. Tenant Christian Lackner of 2526 Van Ness Ave.
(AT010187) reminded the Board that he no longer has the same use of his
storage space; said it would be illegal to use the space; and said he does
not believe that he should have to pay for the space.
B. Attorney Marilyn Kalman, representing the tenant
at 3 - 27th St. (AT010190), told the Board that the tenant, who
was not able to competently present his case, recently retained her. Ms.
Kalman said that other tenants at the unit are affected by the decision,
and asked that the case be remanded for another hearing.
C. Attorney Karen Uchiyama, representing the landlord
in the case concerning 1670 Clay St., Apt. 12 (AT010188), said that there
is an abundance of evidence to support the decision, and maintained that
the tenant has not resided in the unit for over one year.
D. Attorney Rebecca Kruse, representing the tenant
in the case at 1670 Clay St., Apt. 12, informed the Board that the tenant’s
condominium in Florida has been rented out and is no longer available to
her as a residence. According to Ms. Kruse, since the passage of Rules and
Regulations Section 1.21, the tenant has returned to San Francisco and obtained
employment.
E. Tenant Gloria Botelle of 1670 Clay St., Apt.
12, said that the landlord took pictures of her apartment and is "resorting
to the lowest level" to get her out of the unit.
F. Alex Chaudoir, landlord in the case at 3 - 27th
St. said that the tenants were given every opportunity to present their
case; the Administrative Law Judge was fair; and there is no value in reopening
the case.
V. Consideration of Appeals
A. 1670 Clay St., Apt. 12 AT010188
The landlord filed a petition seeking a determination
as to whether the unit constituted the tenant’s principal place of residence.
The Administrative Law Judge found that the tenant was not a "tenant in
occupancy" pursuant to Rules and Regulations Section 1.21 because she had
resided in a unit in Florida which she owns with her mother for the past year,
and that is the place to which she returns after traveling or job-related training.
The tenant appeals, claiming that the Administrative Law Judge erred by applying
Section 1.21 retroactively, by not considering the elements enumerated in the
Section and misapplying the facts as they relate to "usual place of return."
The tenant also argues that she had no notice that being away from her unit
for an extended period of time would jeopardize the rent controlled status of
her tenancy; that she has only been gone for reasonable temporary periods of
absence, always with the intention of returning to her home in San Francisco;
and that the Decision presents her with a financial hardship.
B. 1935 Franklin #503 AL010184
The landlord’s petition for a rent increase based
on comparable rents was granted, and a rent increase from $930.00 to $1,650.00
was approved. Additionally, the landlord was found liable to the tenants in
the amount of $59.52 due to a one-month overpayment in rent. The Administrative
Law Judge found that the prior resident manager of the building had approved
the tenants’ exchanging units in the building at the same rent, but lacked
the authority to do so, which constituted fraud or "some other reason"
for the tenants’ rent having been set low. The tenants’ appeal of the portion
of the decision allowing the comparables rent increase was considered at the
October 30, 2001 Board meeting. The landlord appeals the determination that
a new tenancy commenced in 1998 and, therefore, no banking was available to
the landlord prior to that time. On appeal, the landlord maintains that since
the tenancy was assigned, all rights and liabilities of the prior tenancy
accrue to the new tenancy; that the decision set the rent at a discounted
level, and not at market; there are factual errors in the decision; and the
actions taken by the Board in granting the tenants’ appeal at the October
30th meeting constitute an abuse of discretion and conflict with
the court’s decision in the case of Vega v. City of West Hollywood
MSC: To recuse Commissioners Lightner and Becker
from consideration of this appeal. (Murphy/Gruber: 5-0)
MSC: To accept the appeal and remand the case
to the Administrative Law Judge on the record on the issue of the allowable
banking only. (Murphy/Gruber: 4-0)
C. 2526 Van Ness Ave. AT010187
The tenant’s appeal was filed five days late because
he allegedly was informed by a staff member that the appeal had to be postmarked,
rather than received by the office, on the 15th day after mailing
of the decision; and the Thanksgiving Holiday compounded what would have been
one day’s untimeliness.
The tenant’s petition alleging decreased housing services
was granted in part and denied in part. The landlord was found liable to the
tenant in the amount of $40.00 due to the lack of heat in the unit for an
8-day period. The tenant’s claim that no longer being allowed to store combustible
materials in his storage space constitutes a substantial decrease in services
was denied, as it had been in prior cases before the Board. On appeal, the
tenant asserts that there are now different circumstances and evidence that
warrant reconsidering the question of whether the changed use of the storage
space constitutes a decrease in services.
D. 1369 Hyde St. #65 AL010189
The tenant’s petition alleging decreased housing services
due to the removal of garage space in the building was granted and the landlord
was found liable to the tenant in the amount of $300 per month, the current
fair market value of the parking space. The landlord appealed, contending
that the tenant should not be granted a rent reduction upon removal of the
housing service that is greater than the amount they were paying for the service.
The appeal was accepted and the case was remanded for a hearing to take evidence
regarding the intended use of the parking space and to consider the landlord’s
credibility regarding the long-term use of the space. The landlord did not
personally appear at the remand hearing. Therefore, the Administrative Law
Judge was unable to assess the landlord’s credibility, and determined that
a sworn declaration submitted by the landlord constituted hearsay that was
not sufficiently reliable and trustworthy to form the sole support for a finding
in the landlord’s favor. The original decision was therefore upheld. The landlord
appeals the remand decision, asserting that: the garage space has not been
re-rented, although it has been eleven months since it was withdrawn from
the tenant’s use, and there is no evidence that it will not be used by the
owner; there is no authority in the Ordinance for a rent reduction greater
than the monies demanded or paid for the service; the reasons for the withdrawal
of the housing service are irrelevant to the valuation of that service; the
value of the garage originally constituted 13% of the tenant’s total rent
obligation, but the valuation determined by the Administrative Law Judge constitutes
21% of the total rent, so the total rent for the unit is now 8% less than
if the landlord had never rented the parking space to the tenant; and to restrict
the amount of rent increases permitted for the unit but compensate for a withdrawn
service at market level is unjust and confiscatory.
MSC: To recuse Commissioner Lightner from consideration
of this appeal. (Gruber/Becker: 5-0)
MSC: To accept the appeal and remand the case
to the Administrative Law Judge on the record to grant a rent reduction
in the amount of the contract rent for the parking space; the tenant
can re-file the petition should the circumstances change and the landlord
re-rents the parking space. (Gruber/Murphy: 4-1; Marshall dissenting)
E. 469 - 8th Ave. AT010191
The tenant’s petition alleging several decreased housing
services was granted only as to a porch leak and rotted window frame, and
the landlords were found liable to the tenant in the amount of $1,430.00.
The tenant appeals only as to the back stairs, claiming that cat feces render
them unusable.
F. 3 - 27th St. AT010190
The tenant’s Summary Petition was denied as to an
allegation of unlawful rent increase because the Administrative Law Judge
found that the tenant no longer permanently resides on the premises and, therefore,
a rent increase was warranted pursuant to Costa-Hawkins. However, it was determined
that the rent increase notice issued by the landlord was defective because
it was served on other occupants at the property, and not served on the original
tenants, who had not terminated their tenancy. The tenant appeals, claiming
that the Administrative Law Judge erred by: determining the rights of other
tenants who were not party to the petition nor present at the hearing; going
beyond the scope of the Summary Petition; finding the tenant’s testimony not
to be credible; and determining that other occupants of the unit are not original
tenants.
G. 5309-5311A Mission St. AL010192
The tenants’ petition alleging decreased housing services
was granted, and the landlord was found liable to the tenants in the amount
of $2,668.50 due to habitability defects on the premises. On appeal, the landlord
claims not to have received the Notice of Hearing, and also alleges that the
decision presents him with a financial hardship.
H. 2310 Powell St. #305 AT010194
The landlord’s petition for certification of capital
improvement costs for 168 of 344 units was granted. Two tenants in one unit
filed an appeal of the decision on the grounds of financial hardship. Pursuant
to the agreement of the landlord, the Rent Board Commissioners voted to defer
imposition of the passthrough for one year. The motion passed by the Board
also provided that, if the tenants wished an extension of the deferral beyond
the one-year period, they must file another Tenant Hardship Application by
no later than December 1, 2001, which the tenants have done.
I. 3330 Pierce St. #104 AT010193
The landlord’s petition for rent increases based on
increased operating expenses was granted, resulting in 7% base rent increases
to the tenants in 15 units. The increase was denied as to the tenants in unit
#104, because they had received a comparables rent increase effective April
1, 2001, a date which fell within Year 2 of the operating and maintenance
expense petition. The landlord appealed only as to the denial of the increase
to unit #104, asserting that the decision on the comparables rent increase
established the base rent as of December, 1995, and factored in only annual
increases since that time, which should not preclude an additional increase
based on subsequent increased operating expenses. The Board accepted the appeal
and remanded the case to the Administrative Law Judge to grant the operating
and maintenance expense increase, based on the facts of this case. The tenants
appeal the remand decision, asserting that: property taxes were omitted for
a substantial portion of the base year; adequate documentation was not provided
with the petition, which should have been dismissed; the comparison periods
chosen did not allow for a fair comparison of costs and created exaggerated
results; costs that had been passed through as a bond passthrough were included
in the operating expense petition; debt service payments for only ten months
were included in the base year; mortgage principal does not constitute an
"actual cost"; the landlord should have been required to furnish
income tax statements; costs for preparation of vacant units were included
in the petition; monthly expense logs from the previous owner were purposely
omitted; and Rules Section 6.11(a)(2) precludes an operating expense increase
to this unit.
J. 747 Geary St., #504 AT010195
The tenant’s appeal was filed over one year late because
the tenant alleges that multiple mental and physical disabilities interfered
with her ability to fill out the requisite forms.
The landlord’s petition for certification of capital
improvement costs to 16 of 22 units was granted. One tenant appeals the decision
on the grounds of financial hardship.
VI. Communications
The Commissioners received the following communications:
A. The Appeal Decision in the case at 1320, 1340 &
1360 Lombard St., (AT010052 et seq.) which was heard and decided on November
13, 2001. Commissioner Gruber made a motion to approve the decision, which
was seconded by Commissioner Lightner. However, Commissioner Marshall had
some concerns regarding language in the decision regarding the question of
deferred maintenance. Since Commissioner Justman was not at the meeting, and
he had voted on the decision, Commissioner Wasserman asked that this matter
be continued to the next meeting so that she could consult with Commissioner
Justman.
B. The office workload statistics for the month of
November, 2001.
C. A copy of the appellate decision in the case of
Danekas v. Rent Board (Superior Court Case No. 310104; Court of Appeal
No. A092400), in which the Court of Appeal denied the landlord’s appeal and
affirmed the trial court’s ruling upholding Rules and Regulations Section
6.15A.
IV. Remarks from the Public (cont.)
Landlord appellant Greg Blaine asked which Technical
Corrections to the decision would be made in the case at 3330 Pierce St. #104
(AT010193).
VII. Old Business
The Board continued their discussion of a proposed
amendment to Rules Section 6.10(e), pursuant to the Public Hearing held on
October 16th. The proposed language would make it clear that only
an owner who incurred an increase in expenses can file a petition for rent
increase based on those expenses. Commissioner Lightner had previously voiced
her concern that estates can’t petition for increases based on the property
tax reassessment triggered by the death of the owner because it takes so long
for the supplemental tax bill to be issued by the City. At the meeting on
December 4, 2001, the Board agreed that a possible approach to the problem
might be to allow the estate to petition for property tax increases not yet
received or paid, but which could be calculated pursuant to the applicable
formula. However, Senior Administrative Law Judge Sandra Gartzman confirmed
with the Property Tax Assessor’s Office that the formula used for calculating
supplemental taxes for subsequent purchasers would not be applicable here,
since the formula relies in part on purchase price. While a representative
of the estate can request an expedited appraisal of the property upon which
the supplemental taxes will be calculated, it could take six months or more
for such an appraisal to be conducted. If the estate does not own the property
long enough to qualify for the operating and maintenance expense increase,
an alternative would be for the estate to file the petition, obtain the increased
sales price and assign the petition to the new owner. This issue will be discussed
further at the next meeting.
This issue was continued to the next meeting.
VIII. New Business
Commissioner Murphy brought up the problem of packets
being delivered too late for the Commissioners to adequately prepare for the
meeting. It was agreed that for those three Commissioners who have been experiencing
this problem, namely Lightner, Becker and Murphy, packets will be delivered
by messenger. In the future, any Commissioner who wishes to may be added to
this list.
IX. Calendar Items
January 15, 2002 - NO MEETING
January 22, 2002
7 appeal considerations (1 rescheduled from 1/8/02)
Old Business:
A. Proposed Amendment to Rules and Regulations
Section 6.10(e)
(Goodwin v. Rent Board {Superior Court
Case No. 317339})
B. Petition for Rules & Regulations Section
1.21 Determinations
X. Adjournment
President Wasserman adjourned the meeting at 9:06
p.m.