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December 12, 2023
ITEM TITLE
Housing Policy Update: Report on Implementation of the Chula Vista Residential Tenant Protection Ordinance, CVMC Chapter 9.65, and Impacts of Recently Adopted California Senate Bill 567 Report Number: 23-0299
Location: No specific geographic location
Department: Housing and Homeless Services
G.C. § 84308: No
Environmental Notice : The activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act (“CEQA”) State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
Recommended Action
City Council hear the presentation.
SUMMARY
City Council adopted Chapter 9.65 of the Chula Vista Municipal Code establishing Residential Tenant Protections, on October 25, 2022 via Ordinance No. 2022-3527, to provide greater protections than the State of California’s Tenant Protection Act of 2019. Specifically, Chapter 9.65 aimed to address no-fault terminations of tenancy related to substantial remodels of rental properties, removal of rental properties from the rental market, demolition of rental properties, government/court order, and owner or family move- ins. The provisions further define and prohibit harassment and retaliation against tenants and provide remedies and tools for enforcement.
On September 30, 2023 the State adopted further protections via Senate Bill 567. Tonight’s item responds to referrals from both Councilmembers Preciado and Cardenas to provide a summary of the new state legislation impacts on our local ordinance and an update on implementation of such to date, respectively.
ENVIRONMENTAL REVIEW
The Director of Develo pment Services has reviewed the proposed activity for compliance with CEQA. The activity is not a “Project” as defined under Section 15378 of the State CEQA Guidelines because the proposal P a g e | 2
consists of a reporting action, is not for a site -specific project(s) and will not result in a direct or indirect physical change in the environmental. Therefore, pursuant to Section 15060(c)(3) of the State CEQA Guidelines the activity is not subject to CEQA.
BOARD/COMMISSION/COMMITTEE RECOMMENDATION
At the October 25, 2 023 meeting of the Housing & Homeless Advisory Commissio n, an update on implementation of the Residential Tenant Protection Ordinance and new state law was provided.
DISCUSSION
Local Tenant Protections
On October 25, 2022 the City Council adopted Chula Vista Municipal Code Chapter 9.65 - Residential Tenant Protection (CVMC 9.65 or the “Ordinance” ) to require just cause for termination of residential tenancies consistent with Civil Code Section 1946.2 under the T enant Protection Act of 2019 , Assembly Bill 1482 (AB1482), to further limit the reasons for termination of a residential tenancy, to require greater tenant relocation assistance in specified circumstances, and to provide additional tenant protections.
Since the effective date of the Ordinance on March 1, 2023, the City has been notified by owners/landlords of no-fault terminations of tenancy for less than 30 units subject to CVMC 9.65, mainly citing substantial rehabilitation or demolition as the reason for termination. In all cases, the City provided a follow -up voluntary information package to impacted tenants and have received one response to date, which is currently being assessed for resource referral. In addition, the City has assessed no fines to property owners during this time. A dashboard has been established on the City’s dedicated webpage for Landlord and Tenants to provide real time information on impacts at http://www.chulavistaca.gov/landlordtenant.
State Tenant Protections
On September 30, 2023 California Senate Bill 567 (SB567), Termination of tenancy: no-fault just causes: gross rental rate increases , was adopted, amending AB1482. SB567 adds additional requirements related to the termination of tenancy for the following no-fault bases through the amendment of Section 1946.2:
Owner or Family Move-In: Requires that written notice terminating the tenancy contain the name(s) and relationship to the owner of the intended occupant. The notice must also tell the tenant that they may request proof that the intended occupant is an owne r or related to the owner, and such proof must then be provided. Also requires that the intended occupant move in within 90 days after the tenant vacates and then continues to occupy the unit as their primary residence for a minimum of 12 continuous months. In the event that the intended occupant does not move in within 90 days or continuously occupy the rental unit for 12 consecutive months, the owner must offer the unit to the tenant who was forced to vacate at the same rent and lease terms in effect when the tenant vacated, and the owner must reimburse the tenant for reasonable moving expenses incurred in excess of any relocation assistance paid.
Demolition or Substantial Remodel: Requires that written notice to the tenant include a description of the substantial remodel to be completed, expected duration of the repairs or the expected date by which the property will be demolished, and either a copy of the permit(s) required to undertake the substantial remodel or demolition or a copy of the signed cont ractor hired to complete the substantial remodel.
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Under AB1482, until January 1, 2030 an owner of residential real property is prohibited from, over the course of any 12 -month period, increasing the gross rental rate for a dwelling or a unit more than 5% p lus the percentage change in the cost of living, or 10%, whichever is lower, of the lowest gross rental rate charged for that dwelling or unit at any time during the 12 months before the effective date of the increase, subject to specified conditions. SB567 adds a provision to existing law that makes an owner who demands, accepts, receives, or retains any payment of rent in excess of the maximum rent increase allowed liable in a civil action to the tenant.
Significantly, SB567 increases the penalties with respect to violations of the law, including making an owner potentially liable to the tenant for damages of up to 3 times the actual damages in addition to punitive damages. SB567 further a uthorizes the Attorney General and the local city attorney or county counsel to enforce the law’s provisions through an action for injunctive relief.
SB567’s provisions will become effective on April 1, 2024. To maintain consistency with state law, staff intends to bring an item to Council prior to April 1, 2024, amending Chula Vista Municipal Code chapter 9.65 to reflect the new state law provisions. An updated summary of the differences between SB567 and current local law is provided in Attachment 1.
DECISION-MAKER CONFLICT
Staff has reviewed the decision contemplated by this action and has determined that it is not a site- specific and consequently, the real property holdings of the City Council members do not create a disqualifying real property-related financial conflict of interest under the Political Reform Act (Cal. Gov’t Code §87100, et seq.).
Councilmember McCann may, however, have a conflict of interest given his ownership interest in rental property and property management business. Otherwise, Staff is not independently aware, and has not been informed by any other City Council member, of any other fact that may constitute a basis for a decision-maker conflict of interest in this matter.
CURRENT-YEAR FISCAL IMPACT
There is no current year fiscal impact to the General Fund as a result of this action. To date, the implementation of CVMC Chapter 9.65 has had little impact on the Housing Authority budget. With only a few terminations reported to date, the budget has been able to absorb the increased costs of administration.
ONGOING FISCAL IMPACT
There is no ongoing fiscal impact to the General Fund as a result of this action as currently presented.
Implementation of the Ordinance is anticipated to continue to have minor indirect costs for staff time to collect data, respond to and educate resident s. Staff will continue to evaluate impacts and provide City Council with updates related to administrative changes and/or budgetary impacts.
ATTACHMENTS
1. Comparison of State Law (AB1482 and SB567) and current CVMC 9.65 Regulations Staff Contact: Brian Warwick, Housing Manager
Carlos Rodriguez, Management Analyst II
Stacey Kurz, Director of Housing & Homeless Services