May 07, 1996

I. Call to Order

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

II. Roll Call

Commissioners Present: Becker; Bierly; Gruber; Lightner; Marshall; Mosser; Palma; Wasserman.
Commissioners not Present: Moore.
Staff Present: Grubb; Wolf.

Commissioner Murphy appeared on the record at 5:45 p.m.

III. Approval of the Minutes

MSC: To approve the Minutes of April 30, 1996.
(Lightner/Gruber: 5-0)

IV. Remarks from the Public

Two landlords expressed their concern over an article in the San Francisco Examiner that indicated that recent mayoral appointments to the Rent Board had created a tenant bias on the Commission.

V. Consideration of Appeals

A. 172A, 174A & 174B Castro St. Q001-44A
(re-scheduled from 4/2/96)

The landlords of a Newly Covered Unit under Proposition I filed a petition seeking rent increases based on comparable rents, asserting that they purchased the property in reliance on their ability to raise rents without limitation from the Rent Ordinance and claiming landlord hardship. The tenants asserted financial hardship as well. The landlords chose not to pursue rent increases based on comparables for units with tenancies of similar duration. The petition was denied because the hearing officer found that the landlords’ current income exceeded their expenses so that hardship was not demonstrated, and therefore the evidence of recent tenancies proffered by the landlords was not comparable to the subject tenancies. The hearing officer found that although the medical condition of one of the landlords was likely to result in an inability to work, current financial hardship had not been established. On appeal, the landlords assert that: the hearing officer should have allowed consideration of a fair and reasonable rate of return from the property when considering the landlords’ hardship application, relying on the case of Kavanau v. Santa Monica Rent Control Board; and the significant liquid assets and wealth of one of the tenants should have been considered relative to that of the petitioners.

MSC: To excuse Commissioner Murphy from consideration of this appeal. (Murphy/Marshall: 5-0)

MSF: To accept the appeal and remand the case to re-examine the issue of landlord hardship with instructions. (Lightner/Gruber: 2-3; Becker, Marshall, Palma dissenting)

MSC: To deny the appeal without prejudice to the future filing of a petition should the landlords’ financial circumstances change; any claims of tenant hardship would be examined at that time as well. Such a petition would be given priority in scheduling. (Becker/Marshall: 4-1; Lightner dissenting)

B. 172A Castro St. Q001-51A

The tenant’s petition alleging decreased housing services was granted as to a claim of inadequate water pressure only and the landlords were found liable to the tenant in the amount of $25.00 per month ($525.00). The landlords appeal the decision, asserting that: the tenant failed to meet his burden of proving his contentions and the building is up to code in this regard; the landlords live in the building themselves and have not experienced the problem of which the tenant complains; and there would only be a problem in the unlikely event that the residents of all four units in the building showered at the same time.

MSC: To excuse Commissioner Murphy from consideration of this case. (Murphy/Marshall: 5-0)

MSC: To accept the appeal and remand the case to the hearing officer to re-examine whether the problem with the water pressure rises to the level of substantiality; a hearing will be held only if necessary. (Marshall/Palma: 5-0)

C. 2400 Pacific Ave. #606 Q001-62R

The landlord’s petition for rent increases based on increased operating expenses and certification of capital improvement costs for forty-five of sixty-two units in the building was granted. Two tenants, an elderly couple, appeal the decision on the grounds of financial hardship.

MSC: To accept the appeal and remand the case for a hearing on the
tenants’ allegations of financial hardship.
(Marshall/Becker: 5-0)

D. 134-136 Carl St. Q001-50A

Four tenant petitions alleging substantially decreased housing services were granted in part and denied in part. The landlords were found liable to the tenants in the amount of $525.00 ($25.00 per month) due to the damaged condition of the entry way to the building, which resulted from the Loma Prieta earthquake. On appeal, the landlords allege that the hearing officer erred in granting rent reductions in the amount of $25.00 per month when the tenant petitioners requested only $20.00 per month for the condition of the building’s entry way; that the hearing officer incorrectly concluded that long-term verifiable notice of the condition was given to the landlords; and, that once notice was given, the entry way was repaired within one month.

MSC: To excuse Commissioner Mosser from consideration of this appeal. (Lightner/Becker: 5-0)

MSC: To accept the appeal and remand the case to the hearing officer only to limit the amount of the rent reductions granted for the condition of the entry way to the sums requested in the tenants’ petitions. (Marshall/Becker: 4-1; Gruber dissenting)

E. 736 Dolores St. Q001-61R

The tenant’s petition alleging substantial decreases in housing services was granted in part and denied in part. On appeal by the landlords, the case was remanded to the hearing officer on the record to determine a cut-off date for the rent reduction due to the loss of use of the washer and dryer on the premises, based on the remaining life span of the appliances, which was determined to be through September 1995. The tenant appeals the Decision on Remand, arguing that the rent reduction should continue until such time as the washer and dryer actually cease to function or the service is replaced, because the appliances are still in working order and the tenant has been deprived of their use by the landlords’ actions.

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

F. 2398 Pacific Ave. Q001-52A

The tenant’s petition alleging substantial decreases in housing services was granted, in part, and the landlord was found liable to the tenant in the amount of $1,450.00 due to the loss of roof deck access, water-damaged walls, decreased building maintenance, intermittent scalding hot water in the shower, reduced garage door security and dirty windows caused by the landlord’s roofing contractor. The landlord appeals the decision, claiming that: the hearing was a denial of due process, since the tenant’s petition did not provide adequate notice of the issues to be presented; at no time was the roof deck presented as available to the tenants, and tenants were discouraged from going up on the roof; substantial sums have been expended to mitigate the water seepage problem; and the allegation of scalding hot water in the shower is not credible because only one other tenant in the building has complained of this problem.

MSC: To accept the appeal and remand the case to the hearing officer on the record to clarify whether or not weather was taken into consideration in determining the amount of the rent reduction for loss of access to the roof deck, and to make appropriate adjustments if it was not. The appeal is denied as to all other issues. (Marshall/Becker: 5-0)

VI. Communications

In addition to correspondence concerning cases on the calendar, the Commissioners received the following communications:

A. The monthly workload statistics for March, 1996.

B. A letter to the State Bar regarding the conduct of an attorney involved in the eviction case at 474 - 19th Ave. (Q001-36E), which was approved by the Board and signed by President Becker.

C. An updated roster of Commissioners’ addresses and phone numbers.

VII. Old Business

Discussion of proposed amendments to Rules Section 10.10 authored by Commissioner Becker was continued to the next meeting.

IV. Remarks from the Public (cont.)

A member of the public asked what was meant by the Board’s "leaky roof policy." It was explained that weather considerations are factored in when granting rent reductions for weather-related problems, such as roof leaks, access to roof decks, etc.

VIII. Calendar Items

May 14, 1996 - NO MEETING

May 21, 1996
1 appeal consideration
6:00 Appeal Hearing: 19 Noe St. #B (Q001-37A) (acpt. 3/19/96)
(rescheduled from 5/7/96)
Old Business: Proposed Amendments to Rules Section 10.10

IX. Adjournment

President Becker adjourned the meeting at 8:00 p.m.