September 8, 2009

Commissioner Marshall appeared on the record at 6:08 p.m.; Commissioner Murphy arrived at the meeting at 6:16 p.m.

MSC: To approve the Minutes of August 4, 2009.

(Crow/Henderson: 5-0)

A. Stanley Anastasio, the landlord in the case at 273 – 29^th St. (AL090181), told the Board that he thought that Molly Smart was the only tenant on the premises when he bought the building, and that he returned a rent check tendered by Ann Smart. Mr. Anastasio does not believe it is fair that he is being told he should have relied on the Estoppel Certificate when it wasn't filled out truthfully. Mr. Anastasio said that none of the four individuals listed on the Estoppel really lived at the property. Rather, there was a Homeowner's Exemption on another property and several Deeds of Trust. Mr. Anastasio said that, in light of the evidence, the decision should be reversed and Costa-Hawkins should prevail.

B. Tenant Ann Smart of 273 – 29th St. told the Board that she has lived in the subject unit since 1978; her family has been there for 31 years. She asked that the Commissioners over-rule the appeal.

C. Ann Smart's daughter, Jasmine, said that sleeping on a futon doesn't mean you don't live somewhere, and that it all comes down to subjective opinions.

The landlord's petition for approval of utility passthroughs for 6 of 53 units was approved, resulting in a monthly passthrough in the amount of $23.38. One tenant appeals the decision on the grounds of financial hardship.

The tenant's appeal of two decisions approving utility passthroughs and one decision certifying capital improvement costs were filed six months, one year and seven years late, respectively. The tenant's brother used to live with her but passed away, and the tenant is now having difficulty paying the rent.

The landlord's two petitions for approval of utility passthroughs and two petitions for certification of capital improvement costs were granted. One tenant appeals the four decisions on the grounds of financial hardship.

The tenant's petition alleging decreased housing services was dismissed due to her failure to appear at the properly noticed hearing. On appeal, the tenant claims not to have received the Notice of Hearing and attaches the requisite Declaration of Non-Receipt of Notice of Hearing.

The landlord's petitions for rent increases based on increased operating expenses and approval of utility passthroughs were granted. One tenant appeals the decisions on the grounds of financial hardship.

MSC: To accept the appeals and remand the cases for a hearing on the tenant's claims of financial hardship.

(Mosbrucker/Marshall: 5-0)

The landlord's petition seeking a determination as to whether there is currently a "Tenant in Occupancy" in the subject unit was granted and the ALJ found that a rent increase is warranted pursuant to Costa-Hawkins. The tenant failed to appear at the properly noticed hearing. On appeal, the tenant claims not to have received the Notice of Hearing, and attaches the requisite Declaration of Non-Receipt of Notice of Hearing.

The landlord's petition for rent increases to 16 units based on increased operating expenses was granted. The tenants in unit #410 appeal the decision on the grounds that: the landlord selected comparison years in order to create exaggerated results; the repayment of general obligation bonds was not considered in the calculation of the increase in the landlord's property taxes; the ALJ did not do an analysis under the "anti-spec" clause (Rules ß6.10{f}); and the landlord should provide a breakdown of the increases in debt service and what the funds were used for.

The landlord's petition seeking a rent increase pursuant to Rules Sections 1.21 or 6.14 or Costa Hawkins was denied because the ALJ found that the subject unit was the tenant's principal place of residence at the time the petition was filed. On appeal, the landlord argues that: the appellee's mother was the last original tenant and the appellee was a subtenant; the other occupants of the unit, including the appellee, were merely visitors; and the tenancy was assigned to the appellee's mother upon her payment of the rent.

The tenant's petition alleging decreased housing services and the landlord's failure to repair was denied. The tenant appeals the decision, claiming that: the repairs made by the landlord are not comparable to the original condition of the unit and constitute a substantial reduction in housing services; the landlord discriminates against her and employs incompetent repair people who do shoddy work; and the ALJ failed to give sufficient weight to the evidence that she provided.

The tenants' petition alleging decreased housing services was granted and the landlord was found liable to the tenants in the amount of $200 per month due to lack of heat and $175.00 per month due to floor damage and mold. The landlord appeals, asserting that he didn't receive notice of the lack of heat until the Notice of Violation was issued on April 23, 2009.

The landlord's petition for approval of utility passthroughs for 2 of 6 units was granted, resulting in a monthly passthrough in the amount of $26.28. The tenant in one unit appeals on the grounds that: he should not have to pay for utility costs incurred prior to the inception of his tenancy; he did not have an opportunity to respond to a submission by the landlord; a hearing should have been granted in this case; the increased costs were caused in large part by the landlord's failure to repair and maintain the boiler; the Rules and Regulations pertaining to utility passthroughs contravene the Ordinance and do not always produce a fair result; and the landlord knew the cost of utilities when he set the base rent.

The tenant's petition alleging decreased housing services was granted and the landlord was found liable to the tenant in the amount of $2,530.25 due to habitability problems on the premises. On appeal, the landlord claims that: the ALJ ignored the statement of the landlord's handyman; the tenant's negligence contributed to the problems; and the severity of the problems was exaggerated by the tenant and the ALJ.

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

A. The office workload statistics for the month of July and corrected statistics for the month of June.

B. Articles from BeyondChron, the New York Times, the Sacramento Bee, the California Housing Law Project's website, and the Federal Reserve's Division of Consumer and Community Affairs' website.

C. An updated copy of the Rules and Regulations.

The Board continued their discussion of proposed changes to Rules Sections 12.15(e) and 12.16 regarding extensions of time to do capital improvement work. The proposed changes were as follows:

1. An amendment to Regulation 12.16(a) to establish a time frame for tenants to reoccupy the unit after completion of capital improvement work similar to the time frame currently in place for reoccupancy after displacement by a natural disaster in Regulation 12.19.

2. An amendment to Regulation 12.16(b) that would require landlords to pay to displaced tenants the rent differential between the rent for the unit where work is being done and a tenant's replacement unit whenever the tenant is out of possession for more than 3 months, whether the landlord's petition for extension of time is granted or denied.

3. An amendment to Regulation 12.15(e)(3) to provide that a landlord's failure to obtain all necessary permits before filing a petition for extension of time is not grounds for denying the petition if the landlord obtained all necessary permits before the hearing on the petition and before serving the notice to quit on the tenant.

Regarding the proposed change to Section 12.16(b), Commissioner Murphy reported that the landlord community feels that with the recent increase in relocation expenses, it would be unfair for landlords to have to pay more. However, there was a consensus among the Commissioners that having a timeline for reoccupancy after completion of the work would benefit both landlords and tenants. Therefore, the Board voted as follows:

The adopted language is as follows:

(a) Where a tenant has vacated a unit to allow a landlord to carry out capital improvements or rehabilitation work, pursuant to Section 37.9(a)(11) of the Ordinance, the landlord shall advise the tenant, in writing, immediately on completion of the improvements, and shall allow the tenant to reoccupy the unit as soon as the improvements or rehabilitation work is completed, and shall not increase the rent for such reoccupancy by more than the limitations set forth in Section 4 above. The tenant shall have 30 days from receipt of the landlord's offer of reoccupancy to notify the landlord of acceptance or rejection of the offer and, if accepted, shall reoccupy the unit within 45 days of receipt of the landlord's offer.

The Board continued their discussion of proposals put forward by Landlord Commissioner Murphy and Tenant Commissioner Mosbrucker regarding restoration of the original rent after voluntary rent reductions. It was ultimately decided to continue with the Board's current policy, which is that where a rent reduction is given by the landlord due to the financial hardship of the tenant or some other non-market-related reason, the restoration of the prior rental amount upon 60 days notice shall not constitute a rent increase. However, rent reductions given as the result of market conditions become permanent.

President Gruber adjourned the meeting at 7:40 p.m.