1 STAFF REPORT
DATE: October 15, 2024
TO: Justin Hess, City Manager
FROM: Patrick Prescott, Community Development Director BY : Simone McFarland, Assistant Community Development Director Jonathan Jones, Communications Manager, Public Information Office
SUBJECT: Review of Community Outreach Results Regarding a Potential Rent Cap
RECOMMENDATION
Provide direction, if any, to staff on possible future action or additional efforts regarding a potential rent cap in the City of Burbank.
BACKGROUND
At the April 23, 2024 meeting, City Council (Council) directed staff to conduct outreach soliciting feedback for a potential local rent cap for the City of Burbank that is more restrictive than the State rent cap.
Two Discussion Paper s regarding public outreach for a potential local rent cap w ere presented at the May 21, 2024 and June 4, 2024 Council meetings as part of the City’s annual budget process. As a result, Council approved a funding allocation as part of the Fiscal Year (FY) 2024-25 budget to conduct public outreach. On June 25, 2024, Council approved sole source agreements with Pivotal Strategies and Fairbank, Maslin, Maullin, Metz & Associates (FM3) to solicit community feedback regarding implementing a potential local rent cap, more restrictive than the current state cap. Council directed staff to bring back a report summarizing the feedback and outcome of the outreach within 90 days.
DISCUSSION
Per Council direction, staff conducted the community outreach efforts including the development of a plan, between July 1, 2024 and September 30, 2024. Specifically, Pivotal Strategies held five interactive community meetings, of which three meetings were held in person and tw o conducted in virtual settings. Meetings were held at various locations, at different times of the day, and on various days of the week. Spanish and Armenian translation was available at all meetings. At each meeting, staff presented an overview of Council’s current tenant protections and existing state regulations followed
COMMUNITY
DEVELOPMENT
2 by a question-and-answer period. Attendees were also able to visit stations around the room and place stickers on boards showing where they believed a local rent cap,1 if any, should be set. Attendees were also asked to complete a questionnaire and provide any additional comments they felt were pertinent to the issue. For those who could not attend an in-person or Zoom meeting, or preferred not to, the same questionnaire and presentation were made available on the project website :
www.BurbankRentCapStudy.com. Recordings of the two virtual meetings in their entirety were also made available for public viewing via the website. More than 480 people attended the virtual and in person meetings, including some who attended multiple meetings. More than 1,018 completed questionnaires, some of which originated from the same internet protocol (IP) address (one computer).
In addition to the community outreach meetings, a statistically relevant 15-minute survey evaluating the community ’s impressions about a citywide rent cap was conducted by FM3. FM3 randomly contacted community members to participate through email s, text messages, and phone calls (in English, Spanish, and Armenian). The survey included 371 renters, 367 Homeowners, and 123 resident landlords. Questions for the survey were developed with Council’s input and data solicited that aimed toward a future decision on how to move forward with or without implementing a citywide rent cap.
Attached are the FM3 Survey Conclusions (Attachment 1) and a Summary of Pivotal Strategies Feedback Outreach Feedback and Questionnaires (Attachment 2).
Presentations will be provided during the City Council meeting on October 15, 2024. The full presentations (with additional slides from FM3) along with an appendix showing submitted comments will be available on the website (BurbankRentCapStudy.com) on October 16, 2024. In Pivotal’s Summary, the feedback provided during the in person meetings was incorporated into the feedback provided during remote meetings to form one presentation.
Studies and Data Needs
Overall, there were a variety of opinions, concerns and thoughts expressed at the meetings. As the last outreach meeting was held on September 30, 2024, the consultant teams are still distilling the data and will provide a detailed presentation of the results at the October 15, 2024 Council meeting . Throughout the five outreach meetings, participants who identified as either tenants or landlords repeatedly asked for studies and data that may be beneficial to the Council when considering the next steps on a potential local rent cap for the City. Specifically, participants requested more data on the following areas and how each would be impacted by a local rent control program:
Impacts to the City:
1) What city programs would have to be cut to fund this program? 2) What is the impact of rent control on community stability (enabling both landlords and tenants to stay in the area)?
3) What is the overall effect on local rents? Stabilize, increase, or decrease rents?
1 For the two Zoom sessions, this option was not available. Instead, the facilitators walked the participants through the online outreach portal while they indicated their responses.
3 Impacts to Renters:
1) What are the rent burdened statistics for the City ? Is there data that shows the number of people who cannot afford their current rent and whether their rent is at- above- or below-market?
2) Studies on residents who have been displaced from high rent increases.
Impacts to Landlords or Property Owners:
1) Studies on inflation and the specific inflationary costs of owning and maintaining property.
2) Provide a clear and expanded explanation of Fair Rate of Return (“What if I can’t raise my rent to cover my costs?”). How does this impact future investment into or maintenance of housing, and future ownership/sales?
3) How does a rent cap affect the value of local property? 4) Is the consumer price index or the overall rate of inflation a good indicator of the rate of cost increases to the landlord?
Impacts on the Housing Stock:
1) What is the e ffect on existing housing stock and supply (housing inventory) , including quality and quantity?
2) What is the status of our current housing stock – average age, improvements, etc.? 3) What are the intended and unintended consequences experienced in other cities? 4) Consideration of fiscal impacts on business es and property values. Have values of properties in rent controlled cities decreased?
Glendale Model
Council requested additional information on the Glendale Rental Rights Program , including specifics on their rent increase relocation assistance policy. Attached is Glendale’s Rental Rights Brochure outlining their tenant protections (Attachment 3) and Just Cause and Retaliatory Evictions Code, Chapter 9.30 that contains their tenant protection programs. (Attachment 4).
Should Council decide to adopt a similar rent cap model for Burbank, staff recommends that the Council does not include the ability to bank or defer rent increases (§9.30.025 D, §9.30.025F, §9.30.033B and §9.30.03 5J) as Glendale staff has indicated that these provisions can be expensive to administer and challenging to enforce.
Additionally, should Council proceed with this option, an assessment of required staffing and estimated expenses and revenues would need to be completed, along with a future code amendment for Council approval.
Next Steps
Council directed staff to present the information from the rent cap outreach and statistical survey within 90 days . Based on the information gathered, t here may be a need for additional data collection and/or studies.
Separately, the City Council has requested the following additional information to possibly augment the adopted Tenant Protection Ordinance:
4 1) A “Tenant’s Bill of Rights” modeled after Culver City’s Anti-Harassment provisions; 2) A narrow “Mom and Pop” exemption excluding corporate or limited liability owners; 3) Explore an extension of “Just Cause” protections to all rental types; 4) End renovation evictions by requiring a right to return at the same rental rate; and 5) Explore additional relocation payments for certain qualified tenants (such as elderly and disabled residents).
Concurrently, staff is in the process of recruiting for five new positions that were approved in the FY 2024-25 budget for the new Housing Enforcement Unit. A separate update on the status of that process was included on the Consent Calendar for the October 15, 2024 Council meeting.
COMMUNITY OUTREACH
Pivotal Strategies conducted a robust outreach program to inform the public about the community meetings and the opportunity to complete the questionnaire. An outline of their efforts as per the scope of work in their agreement with the City is included (Attachment 5). FM2 conducted a statistically significant survey that suggests attitudes and feelings towards a local rent control program.
ENVIRONMENTAL REVIEW
This activity involves organizational and administrative activities of the government related to community outreach, and such efforts have no potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment . A s such, this action is not a “project” subject to the requirements of the California Environmental Quality Act (CEQA) 14 Cal. Code Regs §15378.
FISCAL IMPACT
There is no fiscal impact with the receiving of this report.
CONCLUSION
As per Council’s direction, staff worked with two consultant agencies to conduct a robust yet expedited community outreach program to solicit community sentiment regarding a potential local rent cap. This report summarizes the result s of outreach and a survey City Council requested to solicit information on community sentiment around a potential local rent cap, which would be more restrictive than the State’s current rent cap. Both the participant questions during outreach meetings as well as data in survey responses suggest it may be prudent to solicit additional studies and data before considering a more restrictive, local rent cap and enforcement program.
Staff will also continue to undertake the five Council directives related to further tenant protections and will return with recommendations and information on these items at future Council meeting(s) unless otherwise directed.
ATTACHMENTS
Attachment 1 – FM3 Survey Conclusions
Attachment 2 – Summary of Pivotal Strategies Outreach Feedback and Questionnaires Attachment 3 – Glendale’s Rental Rights Brochure
5 Attachment 4 – Just Cause and Retaliatory Evictions Code, Chapter 9.30 Attachment 5 – Outreach Efforts