May 18, 2004
MINUTES OF THE REGULAR MEETING OF
THE SAN FRANCISCO RESIDENTIAL RENT
STABILIZATION & ARBITRATION BOARD,
Tuesday, May 18, 2004 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 6:06 p.m.
II. Roll Call
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Commissioners Present:
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Becker; Gruber; Henderson; Hurley; Marshall; Mosbrucker; Wasserman.
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Commissioners not Present:
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Mosser.
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Staff Present:
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Wolf.
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Commissioner Justman appeared on the record at 6:09 p.m.; Commissioner Murphy arrived at the meeting at 6:35 p.m. Commissioner Becker went off the record at 7:30 p.m.
III. Approval of the Minutes
IV. Remarks from the Public
A. Tenant Jeremias Zabala of 345 Jones #203 appeared on behalf of the tenant
appellants at the building, and was accompanied by his representative, Luis
Berahona. Mr. Zabala spoke with the assistance of a Tagalog interpreter. He
informed the Board that, if the tenants' hardship appeals were not granted,
several members of the tight-knit tenant community in the building would have
to move. Mr. Zabala also alleged that the capital improvements were really
only minor repairs and complained of the conditions in the building. He feels
it is unfair for the tenants to have to pay, since they are only receiving
S.S.I.
B. Tenant Ernestine Weiss spoke on behalf of the tenants at the Golden Gateway
complex. Ms. Weiss said that Rules Section 4.11 constitutes "gross fraud"
because the landlord gets a rent increase each year, which includes PG&E.
Ms. Weiss told the Commissioners that this hits the elderly the worst, and
that they should "forget indexing and remove it altogether."
C. Robert Pender, Vice-President of the Parkmerced Residents' Organization
(PRO), said that the annual rent increase originally included PG&E. Mr.
Pender told the Board that the management at Parkmerced is "all over
the map" with PG&E passthroughs, and encouraged the Board to "end
the passthrough and end the confusion."
V. Consideration of Appeals
A. 345 Jones St. (8 units) AT040039-46
The landlords' petition for certification of capital improvement costs to
25 of 30 units was granted. The tenants in eight units appeal the decision
on the grounds of financial hardship. All of the appeals were filed ten months
late because the tenants are not native English speakers, many of them are
elderly, and they did not realize that they had the right to appeal.
MSC: To find good cause for the late filing of the appeals. (Becker/Marshall:
5-0)
MSC: To accept the appeal of the tenant in unit A-100 and remand the case
for a hearing on the tenant's claim of financial hardship. (Becker/Marshall:
3-2; Gruber, Hurley dissenting)
MSF: To deny the appeal of the tenant in unit #103. (Gruber/Hurley: 2-3;
Justman, Marshall, Becker dissenting)
MSC: To accept the appeal of the tenant in unit #103 and remand the case
for a hearing on the tenant's claim of financial hardship. (Marshall/Becker:
3-2; Gruber, Hurley dissenting)
MSC: To accept the appeal of the tenants in unit #200 and remand the case
for a hearing on the tenants' claim of financial hardship. (Becker/Gruber:
5-0)
MSC: To accept the appeal of the tenants in unit #203 and remand the case
for a hearing on the tenants' claim of financial hardship. (Gruber/Becker:
5-0)
MSC: To accept the appeal of the tenants in unit #205 and remand the case
for a hearing on the tenants' claim of financial hardship. (Gruber/Becker:
5-0)
MSC: To accept the appeal of the tenants in unit #405 and remand the case
for a hearing on the tenants' claim of financial hardship. (Marshall/Becker:
3-2; Gruber, Hurley dissenting)
MSC: To accept the appeal of the tenants in unit #501 and remand the case
for a hearing on the tenants' claim of financial hardship. (Becker/Marshall:
3-2; Gruber, Hurley dissenting)
MSC: To accept the appeal of the tenants in unit #505 and remand the case
for a hearing on the tenants' claim of financial hardship. (Marshall/Becker:
3-2; Gruber, Hurley dissenting)
B. 2 Casa Way #205 AT040038
The landlord's petition for a determination under Rules Section 1.21 was
granted and the Administrative Law Judge found that no "tenants in occupancy"
resided at the subject premises at the time the petition was filed. On appeal,
the tenants claim that: many of the indicia of residency are present at the
subject unit; the San Francisco Unified School District accepted the subject
unit as the tenants' principal place of residence for the purpose of enrolling
their children in public school; the premises have not been sublet; the tenants
meet the definition of "tenant" in the Ordinance and continue to
use and occupy the premises; and the Ordinance does not require that a unit
be a tenant's principal place of residence in order for rent increase limitations
to apply.
MSC: To recuse Commissioner Wasserman from consideration of this appeal.
(Marshall/Justman: 5-0)
MSC: To deny the appeal. (Gruber/Murphy: 3-2; Becker, Marshall dissenting)
C. 690 Shotwell AT040047
The tenant's petition alleging decreased housing services due to the removal
of a toilet was granted and the landlord was found liable to the tenant in
the amount of $521.48. On appeal, the tenant does not challenge the result
of the Decision but, rather, alleges that certain factual findings are in
error.
D. 2033 Turk AL040032
(rescheduled from 5/4/04)
The tenant's petition alleging decreased housing services due to a recurrent
ceiling leak and water damages was granted, and the landlords were found liable
to the tenant in the amount of $540.00. The landlords' appeal was accepted
and the case was remanded to re-open the record on the past and present status
of the leaks. In the Decision on Remand, the Administrative Law Judge finds
the landlords liable in the amount of $780.00 due to the continuing leaks.
On appeal, the landlords maintain that: the Administrative Law Judge is biased
in favor of the tenant; the problem was not substantial, since the tenant
failed to complain for a two-year period; a DBI inspector failed to find evidence
of water intrusion; there is an arithmetic error in the calculation of the
rent refund; and there is no current evidence of an active leak.
MSC: To deny the appeal except to remand the case to the Administrative Law
Judge for a Technical Correction to the Decision to adjust the amount of the
rent overpayments. (Becker/Marshall: 5-0)
E. 3647-3651 - 19th St. AL040033
(rescheduled from 5/4/04)
The tenant's petition alleging that the landlords' failure to consent to
a replacement roommate constituted a substantial decrease in housing services
was granted, and the landlords were found liable to the tenant in the amount
of $679.31. The landlords had failed to give their consent to the tenant's
proposed roommate because she had previously lived in another unit in the
building, and the landlords alleged that she had left this unit in poor condition.
On appeal, the landlords claim that: their rejection of the proposed roommate
was reasonable; there was damage to the flat for which no deductions to the
security deposit were taken; and the tenant failed to provide the landlords
with any additional information regarding the proposed subtenant when given
the opportunity.
MSC: To deny the appeal. (Becker/Marshall: 5-0)
F. 835 Cole St., Apt. #1 AL040035
(rescheduled from 5/4/04)
The tenant's petition alleging decreased housing services due to leaks in
the bedroom and bathroom was granted and the landlord was found liable to
the tenant in the amount of $7,187.50. On appeal, the landlord claims that
the amount of the rent reductions are excessive considering his many attempts
to remedy the problems; and that at the time of the hearing, he did not have
the evidence to prove that the complaint has been abated.
VI. Communications
The Commissioners received the following communications:
A. A letter from landlord Bill Quan regarding the proposed amendments to
Rules and Regulations Section 4.11.
B. The corrected office workload statistics for the month of March, 2004.
C. An updated list of amendments to the Rent Ordinance.
VII. Director's Report
Acting Executive Director Wolf informed the Board that interviews have commenced
for the hiring of a new Executive Director. She also told them that the Mayor's
Office will be sponsoring legislation authorizing the rental unit fee and
that, in the legislation, the percentage of the fee borne by tenants and landlords
will remain the same as it was this year. Ms. Wolf reminded the Commissioners
to submit their Form 730 Statement of Economic Interest forms.
VIII. Old Business
Proposed Amendments to Rules and Regulations Section 4.11 Regarding PG&E
Passthroughs
On April 20, 2004, the Board held a Public Hearing on two versions of proposed
amendments to Rules Section 4.11, one with indexing for inflation and one
without. The Commissioners continued their discussion on the merits of indexing
at this evening's meeting. Commissioner Murphy said that the Coalition for
Better Housing was prepared to pay Professor Davidoff from the Fisher School
at the Haas School of Business to prepare an analysis. Commissioner Marshall
responded that the decision was one of policy, rather than economics. Commissioner
Marshall reiterated her opinion that the purpose of the PG&E passthrough
is to recover extraordinary costs, and not inflationary increases accounted
for by the annual increase. Commissioner Murphy questioned whether landlords
who have long-standing correctly calculated PG&E passthroughs have a vested
right in retaining their base years without the reduction in the amount of
the passthroughs that indexing would cause. Commissioner Marshall said that
she was prepared to compromise and only index every five years; Commissioner
Murphy said that he could accept indexing on a going-forward basis only. Since
the Landlord and Tenant Commissioners failed to come to agreement, Neutral
Commissioners Justman and Wasserman conferred and offered the following proposal:
for tenants who never had a utility passthrough or who had a passthrough in
effect on 12/31/03 but there are not records to prove costs in the base year,
the base year shall be 2002 but after five years the base year shall be moved
up five years; and for continuing passthroughs where a base year prior to
2002 can be proved, there will be no indexing for years prior to 2002, but
every year thereafter shall be indexed by the CPI. President Wasserman asked
that staff draft this proposal, which will be discussed at the next Board
meeting and put out for Public Hearing some time thereafter. President Wasserman
also pointed out that the draft amended regulations eliminate many of the
abuses that the Board, at the bequest of Supervisor Peskin, was attempting
to ameliorate.
IV. Remarks from the Public (cont.)
D. Ernestine Weiss said that the issue of "hotelization" is not
being addressed at the Golden Gateway complex. Many units are being used for
offices so there is great usage of electricity and other utilities. Ms. Weiss
feels that the PG&E passthrough regulations are "not a question of
compromise, but a question of legality."
E. Genevieve Callejo, PRO Board member, spoke to Rules and Regulations Section
11.23 concerning provision by the Rent Board of interpreters and attorneys
to low-income persons. Ms. Callejo informed the Board that PRO has run out
of money to defend Parkmerced's pending petitions to pass through the cost
of re-piping at the property. She stated that the tenants spent $12,000 on
representation during extensive hearings on the landlord's operating and maintenance
expense petition. She said that Parkmerced is a "special case" because
of the numerous petitions filed by the landlord, and that the Rent Board should
obtain an attorney for the tenants.
F. Laura Traveler, past President of PRO, said that "indexing is the
best way to go" at Parkmerced. Ms. Traveler maintains that an out-of-state
controller calculates the utility bills in error; the tenants are paying passthroughs
in addition to paying their PG&E bills; and, on the same floor, tenants
are paying different passthroughs. Ms. Traveler asked whether the landlord
would be able to provide spreadsheets as proof of their costs, or if they
would be required to furnish copies of the actual bills.
G. Robert Pender told the Board that PRO has requested legal assistance pursuant
to Rules Section 11.23. As Parkmerced has become increasingly diverse, with
many non-English speaking tenants, there is a greater need for interpreters.
H. Joe Bravo, attorney for Parkmerced, said that he wanted to "dispel
misconceptions and untruths." He told the Board that Parkmerced discovered
overcharges in an audit, and brought them to the attention of the Administrative
Law Judge. He also said that they have been endeavoring to rectify overcharges
due to PG&E passthroughs, and have refunded $80,000 since July of 2001.
They are also currently meeting with the Office of the District Attorney in
an attempt to rectify the situation.
IX. New Business
Rules and Regulations Section 11.23 Regarding Provision of Attorneys and
Interpreters
Acting Executive Director Wolf brought to the Board's attention the language
of Section 11.23 of the Rules and Regulations, which states: "If the
Administrative Law Judge determines that a party cannot afford the services
of an interpreter, the Board shall assist in obtaining an interpreter or attorney
at no cost to the party." The Parkmerced Residents' Organization (PRO)
has made a request for legal assistance pursuant to this Section. This issue
will be calendared for discussion at the next meeting.
X. Calendar Items
May 25, 2004 - NO MEETING
June 1, 2004
6 appeal considerations (1 cont. from 5/4/04)
Old Business:
A. Rules and Regs. Section 4.11
B. Rules and Regs. Section 11.23
XI. Adjournment