Concord City Council
January 30, 2024

1 COUNCILMEMBERS
Edi E. Birsan, Mayor
Carlyn S. Obringer, Vice Mayor
Dominic D. Aliano
Laura M. Hoffmeister
Laura M. Nakamura
Civic Center
1950 Parkside Drive
Concord, CA 94519
www.cityofconcord.org
Special Meeting of the
Concord City Council
Tuesday,
January 30, 2024
6:30 p.m. - Open Session Council Chamber
1950 Parkside Drive
and/or Various
telephonic/electronic
locations
*IMPORTANT NOTICE ABOUT PUBLIC COMMENTS AND MEETING PARTICIPATION* Members of the public are invited to attend and participate at: Council Chamber, 1950 Parkside Drive, Concord, CA.

Please note the following change to the City’s public comment procedures: Unless a Councilmember is participating in the meeting remotely pursuant to AB 2449, remote public comment will not be accepted. Public comment may be provided in-person or via email, as set forth below. Members of the public desiring to provide comments as a part of the meeting are encouraged to either submit written comments by 3:00 p.m. prior to the meeting or to attend the meeting in person.

Spanish interpretation is available in the Council Chamber during the meeting.

Under California law, public comments at special meetings are limited to subjects on the agenda only.
2 HOW TO PARTICIPATE
The public is invited to participate in the City Council meeting using any of the following methods:

1. IN PERSON:
a.Members of the public can provide in-person comments in the Council Chamber.

Members of the public are encouraged, but not required, to fill out a speaker card. The Council Chamber will have seating available for members of the public to attend in person up to full seating capacity.

2. REMOTE: Remote public comment will not be accepted, except when a Councilmember participates remotely pursuant to AB 2449. At the time of the posting of this agenda, none of the Councilmembers have notified the City Clerk’s Office that they intend to participate remotely pursuant to AB 2449, and therefore no remote public comment will be accepted at the meeting. If, after publication of this agenda and before the meeting begins, any councilmember determines that they will need to participate remotely due to just cause or emergency circumstances under AB 2449, their remote participation will be announced at the outset of the meeting in connection with the Roll Call item. If a Councilmember participates in the meeting remotely pursuant to AB 2449, the public may participate and provide public comment remotely, as follows:
a. Zoom:
https://cityofconcord.zoom.us/j/89370615690?pwd=PqW7JSaXZStHOPqSOX_GTR3LY TNqIA.UpjNcwdb6EJwfNSF or Zoom Webinar ID: 893 7061 5690 and Passcode:
190190
b.Zoom Phone Numbers. Dial Toll Free: (669) 900-6833 or (346) 348-7799 or (253) 215- 8782.
c.During the meeting, each period for public comment will be announced, and participants may use the “Raise Hand” feature on Zoom to request to speak. If calling in via Zoom use *9 to raise and lower your hand. The meeting host will call on you, by name, and promote you to panelist in the webinar so you can be seen via your camera. Please enable your microphone when it is your turn to speak. In order to ensure the orderly administration of the meeting using this method, providing your name is encouraged, but is not required. (If you need instructions on how to use this feature, please contact the City Clerk by 3:00 p.m. of the meeting date at [email protected]).

3. EMAIL:
a.Public comments can also be submitted via email to [email protected]. Please note that emailed comments will not be read aloud by staff. Any public comments received up until 3:00 p.m. of the meeting date will be:

1. distributed to the Council before the meeting,

2. posted online for public inspection at
https://stream.ci.concord.ca.us/OnBaseAgendaOnline/Meetings/Search, and

3. inserted into the meeting record.
b.As emails containing public meeting comments are part of the official record, note that personal contact information may be published if it is included with your email. 3 4. TO WATCH OR LISTEN ONLY:
a.Watch on TV on Comcast Channel 28, Astound/Wave Channel 1026, and AT&T U-verse Channel 99
b.Watch the TV broadcast through the City’s website by following THIS LINK c.Watch Live Streaming of the meeting by following THIS LINK d.Join the Zoom webinar by following THIS LINK

OPEN SESSION

1. OPENING
Roll Call – Announcements/Consideration and Approval of Requests by Councilmembers to Participate Remotely Pursuant to AB 2449 Pledge of Allegiance – Vice Mayor Obringer

2. CITY COUNCIL PUBLIC HEARING
Persons who wish to speak on Public Hearings listed on the agenda will be heard when the public hearing is opened, except on public hearing items previously heard and closed to public comment.

After the public has commented, the item is closed to further public comment and brought to the Council level for discussion and action. Further comment from the audience will not be received unless requested by the Council. No public hearing shall commence after 10 p.m. unless approved by majority vote of the City Council. Please see “How to Participate” above. a. Considering – introduction of an updated Ordinance amending the Concord Municipal Code by amending Concord Municipal Code Chapter 19.40 “Residential Tenant Protection Program” to increase “just cause” eviction protections, expand the City’s rent registry, and establish a rent stabilization program by reading of the title only and waiving further reading. (Continued from January 9, 2024; this item was opened on Tuesday, December 12, 2023, continued to Tuesday, January 9, 2024, and further continued to January 30, 2024). Report by Sophia Huckabay, Housing Manager.

CEQA: Not a project/exempt pursuant to Public Resources Code Section 21065, CEQA Guidelines Sections 15060(c), 15061(b)(3), and/or 15378.

3. ADJOURNMENT
Next Meeting: Regular Meeting
Date: 2/6/2024 6:30 PM
4 NOTICE TO THE PUBLIC
There is a 90-day limit for the filing of a challenge in the Superior Court to certain City administrative decisions and orders which require a hearing by law, the receipt of evidence, and the exercise of discretion. The 90-day limit begins on the date the decision is final (Code of Civil Procedure §1094.6). Further, if you challenge an action taken by the City Council in court, you may be limited by California law to raising only those issues you or someone else raised in the hearing or in a written correspondence delivered to the City Council prior to or at the hearing.

In accordance with the Americans with Disabilities Act and California Law, it is the policy of the City of Concord to offer its public programs, services and meetings in a manner that is readily accessible to everyone, including those with disabilities. If you are disabled and require a copy of a public hearing notice, or an agenda and/or agenda packet in an appropriate alternative format; or if you require other accommodation, please contact the ADA Coordinator Tianjun Cao at (925) 671-3243 or [email protected], at least 24 hours in advance of the meeting. Advance notification within this guideline will enable the City to make reasonable arrangements to ensure accessibility.

Staff Report
Date: January 30, 2024
To: City Council
From: Valerie Barone, City Manager
Reviewed by: Kevin Marstall, PE, Director of Community Development Prepared by: Sophia Huckabay, Housing Manager
[email protected]
(925) 671-3387
Subject: Considering introduction of an updated Ordinance amending the Concord Municipal Code by amending Concord Municipal Code Chapter 19.40 “Residential Tenant Protection Program” to increase “just cause” eviction protections, expand the City’s rent registry, and establish a rent stabilization program by reading of the title only and waiving further reading. (Continued from January 9, 2024; this item was opened on Tuesday, December 12, 2023,
continued to Tuesday, January 9, 2024, and further continued to January 30, 2024).

CEQA: Not a project/exempt pursuant to Public Resources Code Section 21065, CEQA Guidelines Sections 15060(c), 15061(b)(3), and/or 15378.

Report in Brief
The City Council (Council) held a public hearing on rent stabilization and just cause for eviction policies on December 12, 2023 (Agenda Item 4a) which was continued to January 9, 2024 (Agenda Item 6a), and further continued to a special Council meeting being held on January 30, 2024, to enable additional public input and Council deliberation.

On November 21, 2023, the City released draft revisions to Concord Municipal Code Chapter 19.40 “Residential Tenant Protection Program” which reflected Council direction to increase just cause eviction protections, expand the City’s rent registry, and establish a rent stabilization program. Council received a public presentation on the draft Ordinance and heard over three (3) hours of public testimony December 12, 2023;

2.a2.a2.a2.a2.a2.a2.a2.a2.a2.a2.a

City Council Agenda Report
Agenda Item No. 2.a
January 30, 2024
and continued the item until January 9, 2024, for Council deliberation and decision making. At the January 9, 2024, meeting, Council directed staff to make various modifications to the draft ordinance, requiring the production of a revised draft ordinance, and continued the public hearing to a special meeting on January 30, 2024.

Staff has developed a revised draft ordinance for review and consideration (clean version at Attachment 1, Exhibit A; redline against the previous draft ordinance at Attachment 2). Council will be accepting public comment on the revised draft ordinance at the January 30 meeting.

Council deferred final decisions on two just cause for eviction policy options pertaining to “owner move-ins”: a) percentage of ownership required to constitute an owner move- in, and b) the length of time an owner is required to reside in the unit after moving in.

Staff requests final Council input on those policy matters so that they may be incorporated into the final ordinance. To the extent Council has identified additional policy matters to be addressed, staff respectfully requests direction on those as well.

Recommended Action
Considering:

1. Direction from Council on the following matters:
a. Percentage of ownership required to constitute an owner move-in. b. The length of time an owner is required to reside in the unit after moving in.

2. Introduction of a revised Ordinance amending the Concord Municipal Code by amending Concord Municipal Code Chapter 19.40 “Residential Tenant Protection Program” to increase “just cause” eviction protections, expand the City’s rent registry, and establish a rent stabilization program, by reading of the title only and waiving further reading.

Background
City Council has held meetings on rent stabilization and just cause for eviction policy on September 5, September 12, October 10, December 12, 2023 and January 9, 2024.

During the January 9 meeting, Council provided direction to staff and directed that a revised draft ordinance be produced to support further public input and Council deliberation at the January 30, 2024, continued public hearing. Staff has incorporated Council’s direction into a revised draft ordinance for Council’s review and consideration (Attachment 1 and 2).

Outreach Efforts
Since the first Council meeting held on September 5, 2023, pertaining to policy direction to staff on the topic of rent stabilization and just cause for eviction, staff has continued to

City Council Agenda Report
Agenda Item No. 2.a
January 30, 2024
apprise the public and stakeholders on Council’s direction and deliberations through the use of multiple mediums, including: emails to the Housing interested parties list, posting on the City’s main website and Housing and Community Services webpage, posting to the City’s social media platforms, publishing information in the City’s e-newsletter, and direct communication with key stakeholders. The most recent summation shared with the public and stakeholders can be found in Attachment 3. This document was shared via the City’s social media and the City’s e-newsletter, through a press release, on the website and NextDoor, and through the interested party e-mail list.

Council Direction
At its meeting held on January 9, 2024, Council provided the following feedback to staff on the previous draft ordinance:
 Accessory Dwelling Unit (ADU) definition to include language that demonstrates that only permitted ADUs are exempted from both rent stabilization and just cause for eviction provisions.
 The Permanent Relocation Assistance Amount is defined as three months of HUD Fair Market Rent plus a $3,000 moving stipend, with one month of increased assistance at Fair Market Rent for protected tenants that include tenants who are lower-income, disabled, senior, terminally ill and, households with school-age children.
 Any violation of the ordinance is a defense to an unlawful detainer.  If the tenant household being displaced during an owner move-in contains a member that is disabled, senior, or terminally ill, the owner for owner’s family member must also be either disabled, senior, or terminally ill.  Provide greater specificity in the Ordinance regarding the regulations and procedures that govern the Fair Return on Investment provisions by including language similar to that in the City’s current Mobile Home Rent Stabilization Ordinance (Concord Municipal Code Chapter 15.105).
 Clarifying that the Ellis Act is intended to be fully implemented.  Council directed staff to exempt those affordable properties which have annual rent increase caps which are documented in agreements with, and enforceable by, the City or other governmental agencies. For implementation purposes, staff needed a method to differentiate the allowable rent increase from the standard- metric tied to Average Median Income (AMI) so has drafted the revised Ordinance with a maximum 5% annual cap for the affordable housing properties that are regulated by a regulatory agreement or deed restriction.  Remove the rent stabilization retroactivity clause and replace with a rent rollback clause that resets rents to January 12, 2023, levels with any allowable lawful rent increases.

City Council Agenda Report
Agenda Item No. 2.a
January 30, 2024
Staff has also made clean-up changes, including addition of defined terms based on the Council-directed revisions, refining the Hotel definition, expressly stating that owner- occupied duplexes are fully exempt (as provided in AB 1482 and the rent stabilization/just cause for eviction staff reports), relocating certain provisions for better context, incorporation of clarifying language based on public input, and as reflected in the attached redline (Attachment 2).

Analysis
Council Questions of Staff
At its meeting held on January 9, 2024, Council asked staff for more information on the below topics. Staff’s answers to these questions are provided below:
1) Provide a list of local, City and County funded, affordable housing that currently provides annual rent increase percentage caps as part of its existing agreements with the local jurisdictions.

In June of 2023, the City funded Eden Housing $6.64 Million in the City’s Affordable Housing Funds to deed-restrict Coral Court and Sunset Pines Apartments (116 units) at 30%, 60% and 80% of AMI. The City’s funding requirement included a 4% annual rent increase cap. These are the only two Concord affordable-housing complexes that would qualify for the exemption to the rent-stabilization regulations. Both complexes would be subject to the Just Cause for Provision regulations.

Contra Costa County has recently passed provisions capping annual rent increases for affordable projects (new construction and acquisition/rehabilitation) they invest in to a 5% rent increase cap per year. The only Concord property subject to this cap is Rick Judd Commons (formally Galindo Terrace), which is currently under construction and, therefore, not subject to the City’s proposed rent stabilization ordinance, as it is post 1995.

Discussion of the Draft Ordinance
The revised draft of Concord Municipal Code Chapter 19.40 Residential Tenant Protection Program incorporates Council’s feedback received through the January 9, 2024, Council meeting as noted in the Background section of this report. However, Council deferred final decisions on two just cause for eviction policy options pertaining to “owner move-ins:”
a. Percentage of ownership required to constitute an owner move-in b. The length of time an owner is required to reside in the unit after moving in

City Council Agenda Report
Agenda Item No. 2.a
January 30, 2024
These policies are discussed below:

19.40.070(d)(1) Just Cause for Eviction: No-Fault Termination of Tenancy: Owner Move Ins.

Up until its meeting held on January 9, 2024, Council had directed staff to include language in the City’s just cause for eviction owner move-in provisions that were consistent with State Law. On January 9, 2024, after considering public input on this matter, Council expressed a desire to update the below provisions involving owner move-ins. As such, staff is seeking direction from Council on: a) percentage of ownership required to constitute an owner move-in, and b) the length of time an owner is required to reside in the unit after moving in.
a) Percentage of ownership required
Consistent with Council direction, the original proposed language in draft ordinance was mirrors the language in SB 567-Civil Code 1946.2(b)(2)(A)(viii), stating that a landlord, as defined in the draft ordinance, is:
“a natural person that has at least 25 percent recorded ownership interest in the Property.”
Council has expressed a desire to change the ownership interest percentage from 25 percent, but has not agreed on a percentage for inclusion in the revised draft Ordinance.

This language appears in two sections of the ordinance under 19.40.070.d.1- Just Cause for Evictions- Owner Move-Ins.
b) The length of time an owner is required to reside in the unit after moving in Consistent with Council direction, the original proposed language in draft ordinance mirrors that in SB 567-Civil Code 1946.2(b)(2)(A), and states that if a tenant is evicted for an owner move-in, an owner or owner’s family, as defined in the draft ordinance, must occupy the rental unit as a primary residence for at least 12 consecutive months.

Council has expressed a desire to change the length of time required for a landlord to reside in the unit from 12 consecutive months, but staff is unclear as to what timeframe Council desires.

Program Implementation
At its meeting on October 10, 2023, Council directed staff to return with estimates on the likely fees for administering both programs: Rent Stabilization and Just Cause for Eviction. Staff provided this information as part of its report to Council for the December 12, 2023, Council meeting. The information below is a high-level summary of the

City Council Agenda Report
Agenda Item No. 2.a
January 30, 2024
information shared with Council in December (for more detail please review the December 12 staff report).

Below are projected program costs. These costs and fee ranges are currently estimates; staff will return to Council in February with proposed fee amounts to be adopted through amendments to the City’s Fee Resolution.

Year 1 & 2
 Program Implementation Cost Estimates: $730,000 - $770,000  Rent Registry Fee Range Estimates:
o Partially covered unit (i.e., a unit subject to just cause for eviction regulations but not rent stabilization): $29 to $32 per unit o Fully covered unit (i.e., a unit subject to both just cause for eviction and rent stabilization protections): $49 to $52 per unit
Concord has approximately 18,100 residential rental units, 9,200 of which are fully covered units that are subject to both the rent stabilization and the just cause for eviction provisions, and 8,900 of which are partially covered units subject to just cause for eviction provisions only.

Total Year 1 and Year 2 costs are currently estimated to be $730,000 to $770,000 annually.

City staff time would be required to administer the rent registration program and the rent stabilization and just cause for eviction policy provisions. These activities include, but are not limited to, compliance monitoring, processing petitions, work with a program administrator, drafting communication and conduction outreach/training with the public, in-person housing counseling with the public, managing program contracts, and managing hearings and production of related reports.

To fulfill the new responsibilities required by the proposed Ordinance two new staff positions will be added: a Housing Program Analyst position and an Administrative Secretary position. Additionally, the two existing Housing staff (the Housing Manager and the Housing Program Analyst) are anticipated to spend 25% of their time on the rent registry and tenant protection regulations, including the new rent stabilization and the enhanced just cause protections.

In other words, 2.5 staff positions are necessary to run the new programs, and 2 of the

2.5 positions will be new staff additions. New staff would need to be hired shortly after program adoption. Consequently, under the City Manager’s authority the City will begin recruitment for the two new positions immediately after Ordinance introduction by

City Council Agenda Report
Agenda Item No. 2.a
January 30, 2024
Council. Council will be asked to official set the rent registry fees and approve the two new positions when it reviews the mid-year budget at the end of February. Should Council not take these steps, the positions would not be filled.

Next Steps
 If the revised draft ordinance is introduced on January 30, 2024:
o Staff will return to Council at its meeting on February 13 for Ordinance adoption, which would create an effective date for the ordinance to “go live” as of March 14, 2024—30 days after second reading.  If Council provides additional direction on the revised Ordinance and continues the item to the February 13 meeting and if a revised draft ordinance is introduced on February 13:
o Staff will return to Council at its meeting on March 5 for Ordinance adoption, which would create an effective date for the ordinance to “go live” as of April 4, 2024—30 days after second reading.  February 27, 2024: Staff will return to Council with a modified Rent Registry fee schedule and budget adjustments for the new staff positions as part of the Mid- Year Budget review.
 December 2024: Publish the 4th Annual Rent Registry report which will be the first report under the new program (the 3rd annual report is anticipated to be published in February of 2024 the first two reports are on the City’s website).  January 2025: Staff to make a six-month program update presentation at a Council meeting.

Financial Impact
The program is being designed to provide for full cost recovery; it is not anticipated to have a fiscal impact on the City. Staff anticipates that it may take a few years of experience to learn actual costs and that fees may be modified after the first or second year of experience.

Public Contact
The City Council Agenda was posted. Notice was sent by email to all individuals on the interested party list on January 26, 2024.

Attachments

1. Draft Revised Ordinance Amending the Concord Municipal Code by amending Chapter 19.40 “Residential Tenant Protection Program”
Exhibit A: Amendment to Chapter 19.40, Residential Tenant Protection Program

City Council Agenda Report
Agenda Item No. 2.a
January 30, 2024

2. Draft Redline Version of revised amended Chapter 19.40, Residential Tenant Protection Program

3. Public Outreach on Draft Policy

4. Comparison of Current Versus Proposed Policy

5. Units Covered and Exempt Chart

6. Correspondence Received

Ord. No. 24-XX 1
ORDINANCE NO. 24-XX

AN ORDINANCE AMENDING CONCORD MUNICIPAL CODE CHAPTER

19.40 “RESIDENTIAL TENANT PROTECTION PROGRAM” TO INCREASE “JUST CAUSE” EVICTION PROTECTIONS, EXPAND THE CITY’S RENT

REGISTRY, AND ESTABLISH A RENT STABILIZATION PROGRAM
WHEREAS, on October 7, 2019, the Governor of the State of California signed AB 1482 into law. AB 1482 addresses a number of rental housing policies, including maximum rent increases, just cause eviction protections, and relocation assistance; and WHEREAS, on July 7, 2020, the City Council adopted Ordinance No. 20-7 adding Concord Municipal Code Chapter 19.40 "Residential Tenant Protection Program" to establish a Residential Tenant Protection Program that became effective August 28, 2020, and requires, among other things, relocation assistance for no-fault just cause evictions, and that tenants be provided a written lease with minimum lease terms; and
WHEREAS, on January 12, 2021, the City Council adopted Ordinance No. 20-10 amending Concord Municipal Code Chapter 19.40 "Residential Tenant Protection Program" by adding Section

19.40.110 "Rent Registry" establishing a Rent Registry Program that became effective July 1, 2021, and requires property owners to provide information on tenancy and rents; and WHEREAS, there presently exists a critical shortage of rental housing in the City. Due to this shortage, it is very difficult to find adequate, safe, and habitable rental housing at reasonable rents; and
WHEREAS, due to the shortage of rental units, rents in the City are increasing excessively. A substantial number of persons in the City who reside in rental units spend a high percentage of their income on rent, and many have been forced to move out because they could no longer afford to pay the increase in rent; and
WHEREAS, low- and moderate-income tenants have difficulty finding affordable housing after being displaced due to a rent increase; and
WHEREAS, the City Council desires to promote long-term stability and certainty for tenants Attachment 1

Ord. No. 24-XX 2
in the rental market while providing landlords an ability to receive a fair return on their property; and.

WHEREAS, at a duly noticed public meeting held on January 12, 2023 as part of the City’s 6th Cycle Housing Element Update efforts, the City Council directed staff to prioritize development of a just cause for eviction and rent stabilization ordinance; and WHEREAS, based on such direction, City staff solicited and received input from property owner representatives on July 26, 2023 and from tenant representatives on July 27, 2023 (collectively, “Community Meetings”); and
WHEREAS, City staff also solicited responses from a broader group of tenants and property owners through the use of online surveys, from July 31 through August 20, 2023 (collectively, “Community Surveys”); and
WHEREAS, City staff further corresponded with affordable housing providers to better understand the potential impact of rent stabilization and just cause for eviction ordinances on these entities; and
WHEREAS, the City Council held duly noticed public meetings on September 5, September 12, and October 10, 2023 (collectively, “Study Sessions”), received input from the public, tenants and advocates, property owners and property owner representatives, City staff and consultants, and provided policy direction on development of a just cause for eviction and rent stabilization ordinance; and
WHEREAS, the City Council, after giving all public notices required by state law and the Concord Municipal Code, held a duly noticed public hearing on December 12, 2023, which public hearing was then continued to January 9, 2024, and further continued to January 30, 2024, on the proposed amendment of Concord Municipal Code Chapter 19.40 “Residential Tenant Protection Program” to increase “just cause” eviction protections, expand the City’s rent registry, and establish a rent stabilization program as set forth in Exhibit A attached hereto and incorporated by reference (“Ordinance”), and declared their intent to approve, introduce, and adopt the Ordinance; and WHEREAS, the City Council, after giving all public notices required by state law and the Concord Municipal Code, will hold a duly noticed public hearing on February 13, 2024, to further

Ord. No. 24-XX 3
consider the Ordinance, and declare their intent to adopt the Ordinance; and WHEREAS, at such public hearings, the City Council considered all oral and written information, testimony, and comments received during the public review process, including oral and written staff reports, materials, documents, exhibits, reports, studies, memoranda, testimony, and community input received at the Community Workshops, Community Surveys, Study Sessions, and the public hearings on this Ordinance, the City of Concord Municipal Code, applicable City laws and regulations, and all other information that constitutes the record of proceedings upon which the City Council has based its decision and which are maintained at the offices of the City Clerk, 1950 Parkside Drive, MS/3 Concord, CA 94519 (collectively, “Ordinance Information”).

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CONCORD DOES ORDAIN AS FOLLOWS:

Section 1. Recitals. The City Council finds that the above recitals (which are hereby incorporated by reference) are accurate and constitute findings in this matter and, together with the Ordinance Information, serve as an adequate and appropriate evidentiary basis for the findings and actions set forth in this Ordinance and further makes the following findings:

Section 2. Binding Findings. Pursuant to Civil Code Section 1946.2(g)(1)(B), the City Council hereby makes the following binding findings within this Ordinance that this Ordinance is more protective than the provisions of Civil Code Section 1946.2 because:
(a) The just cause for termination of a residential Tenancy under the Ordinance is consistent with and more protective than Civil Code Section 1946.2; and (b) The Ordinance provides additional tenant protections that are not prohibited by any other provision of law, because it provides for earlier and higher relocation assistance amounts than those available to tenants covered by Civil Code Section 1946.2, requires certain minimum lease terms, limits the exemptions listed in Civil Code Section 1946.2 and in particular applies just cause for termination of a Tenancy to Dwelling Units regardless of when a certificate of occupancy is issued for the Dwelling Unit and protects Tenants upon commencement of the Tenancy; and

Ord. No. 24-XX 4
(c) As provided in Civil Code Section 1946.2(g)(2), a residential real property shall not be subject to both a local ordinance requiring just cause for termination of a residential Tenancy and Civil Code Section 1946.2. The Ordinance intends to cover those dwelling units defined as Covered Rental Units and to the extent such units are covered by the Ordinance, such units will not be subject to Civil Code Sections 1946.7 and 1947.12.

Section 3. CEQA. Adoption of this Ordinance is not subject to environmental review under the California Environmental Quality Act (CEQA) of 1970, as amended, because the adoption of the Ordinance does not constitute a “project,” and will not result in a direct or reasonably foreseeable indirect physical change in the environment, pursuant to CEQA Guidelines Sections 15060(c), 15378 and Public Resources Code Section 21065. In addition, the proposed Ordinance is categorically exempt pursuant to Section 15061(b)(3), the common sense exception of the CEQA Guidelines because it can be seen with certainty that there is no possibility that the ordinance may have a significant effect on the environment. No unusual circumstances are present. This determination reflects the City’s independent judgment and analysis.

Section 4. Ordinance Information. The City Council has reviewed, considered, and evaluated all of the Ordinance Information prior to acting on the Ordinance. The Ordinance Information is located in and may be obtained from the City of Concord Clerk’s Office, 1950 Parkside Drive, Concord, CA 94519.

Section 5. Municipal Code Amendment. The City Council hereby approves and adopts the amendment to Concord Municipal Code Chapter 19.40 as set forth in Exhibit A, attached hereto and incorporated by reference.

Section 6. Severability. If any section, subsection, clause, or phrase of this Ordinance, or its application to any person or circumstance, is for any reason held to be invalid or unenforceable, such invalidity or unenforceability shall not affect the validity or enforceability of the remaining sections, or its application to any other person or circumstance. The City Council declares that it would have adopted this Ordinance and each section, subsection, sentence, clause, and phrase thereof, irrespective of the fact that any one or more section, subsection, sentence, clause, or phrase be declared invalid.

Ord. No. 24-XX 5
Section 7. Publication and Effective Date. This Ordinance shall take effect thirty (30) days following passage and adoption. In the event a summary of said Ordinance is published in lieu of the entire Ordinance, a certified copy of the full text of this Ordinance shall be posted in the office of the City Clerk at least five (5) days prior to its adoption and within fifteen (15) days after its adoption, including the vote of the Council members. Additionally, a summary prepared by the City Attorney’s Office shall be published once at least five (5) days prior to the date of adoption of this Ordinance and once within fifteen (15) days after its passage and adoption, including the vote of the Councilmembers, in the East Bay Times, a newspaper of general circulation in the City of Concord. __________________________________
Edi E. Birsan
Mayor
ATTEST:

Joelle Fockler, MMC
City Clerk
(Seal)
//
//
//
//
//
//
//
//

Ord. No. 24-XX 6
Ordinance No. 24-XX was duly and regularly introduced at a special meeting of the City Council of the City of Concord held on January 30, 2024, and was thereafter duly and regularly passed and adopted at a regular meeting of the City Council held on February 13, 2024, by the following vote:

AYES: Councilmembers -
NOES: Councilmembers -
ABSTAIN: Councilmembers -
ABSENT: Councilmembers -
I HEREBY CERTIFY that the foregoing is a true and correct copy of an ordinance duly and regularly introduced, passed, and adopted by the City Council of the City of Concord, California.

Joelle Fockler, MMC
City Clerk
Attachment: Exhibit A – Ordinance (Amendment to Chapter 19.40, Residential Tenant Protection Program)

1 Chapter 19.40
Residential Tenant Protection Program
Sections

19.40.010 Binding Findings; Definitions ; Citation.

19.40.020 General Applicability of Chapter; Exemptions.

19.40.030 Rent Stabilization.

19.40.040 Permitted Rent Increases for Covered Rental Units.

19.40.050 Rent Adjustment Petitions.

19.40.060 Annual Rental Registration.

19.40.070 Just Cause for Eviction.

19.40.080 Relocation Assistance For No-Fault Termination Of Tenancy; Moving Stipend.

19.40.090 Requirement to Offer Written Lease, Minimum Lease Terms.

19.40.100 Notice of Tenant Rights.

19.40.110 Procedures and Guidelines.

19.40.120 Remedies.

19.40.130 Waiver Prohibited.

19.40.140 Severability.

19.40.010 B
inding Findings; Definitions; Citation.
(a) Binding Findings. Pursuant to Civil Code Section 1946.2(g)(1)(B), the City Council hereby makes the following binding findings within this Chapter, that this Chapter is more protective than the provisions of Civil Code Section 1946.2 because:
(1) T
he just cause for termination of a residential Tenancy under this Chapter is consistent with and more protective than Civil Code Section 1946.2; and (2) Th
is Chapter provides additional tenant protections that are not prohibited by any other provision of law, because it provides for earlier and higher relocation assistance amounts than those available to Tenants covered by Civil Code Section 1946.2, requires certain minimum lease terms, limits the exemptions listed in Civil Code Section 1946.2 and in particular applies just cause for termination of a Tenancy to Dwelling Units regardless of when a certificate of occupancy is issued for the Dwelling Unit and protects Tenants upon commencement of the Tenancy; and
(3)
As provided in Civil Code Section 1946.2(g)(2), a residential real property shall not be subject to both a local ordinance requiring just cause for termination of a residential Tenancy and Civil Code Section 1946.2. This Chapter intends to cover those Dwelling Units defined as Covered Rental Units and to the extent such Dwelling Units are covered by this Chapter, such Dwelling Units will not be subject to Civil Code Sections 1946.2 and 1947.12. (b) T
he City Council finds that there presently exists a critical shortage of rental housing in the City. Due to this shortage, it is very difficult to find adequate, safe, and habitable rental housing at reasonable rents.
(1)
Due to the shortage of rental units, rents in the City are increasing excessively. A substantial number of persons in the City who reside in rental units spend a high percentage of their income on rent, and many have been forced to move out because they could no longer afford to pay the increase in rent. Further, low- and moderate-income Tenants have difficulty finding affordable housing after being displaced due to a rent increase. (2)
The purposes of this Chapter are to promote long-term stability and certainty for Tenants in the rental market while providing Landlords an ability to receive a fair return on their Exhibit A to Attachment 1

2 Property. This Chapter regulates Rents and terminations of Tenancy, including requiring relocation assistance and affording a Tenant the right to return under certain circumstances. It requires Landlords to register Covered Rental Units, establishes an administrative hearing process, and provides for procedures and guidelines for the implementation of this Chapter.

(c) Definitions. The following terms shall have the meaning provided below when used in this Chapter, whether plural or singular.

(1) "Accessory Dwelling Unit" shall mean an accessory dwelling unit or a junior accessory dwelling unit as those terms are defined in Code Section 18.200.180, which has received a valid accessory dwelling unit or a junior accessory dwelling unit permit from the City or Contra Costa County.

(2) “Accommodations” shall be as defined in the Government Code Section 7060(b)(1), which, for convenience, reads as follows:

(1) “Accommodations” means either of the following:
(A) The residential rental units in any detached physical structure containing four or more residential rental units.
(B) With respect to a detached physical structure containing three or fewer residential rental units, the residential rental units in that structure and in any other structure located on the same parcel of land, including any detached physical structure specified in subparagraph (A).

(3) “Allowable Annual Rent Increase” shall mean the annual rent increase as set forth in Section 19.40.040.

(4) “Base Rent” shall mean as follows: For tenancies commenced on or before January 12, 2023, the Rent in effect on January 12, 2023 plus the Initial Allowable Annual Rent Increase. For tenancies commenced after January 12, 2023, but prior to the effective date of this Chapter, the Rent charged upon initial occupancy plus the Initial Allowable Annual Rent Increase. For tenancies commenced after the effective date of this Chapter, the Rent charged upon initial occupancy. The foregoing amounts are subject to the assumption that such amounts are not in violation of this Chapter or any provision of State law. Nothing in this definition is intended to alter the requirement that a Landlord provide a Tenant with valid, written notice of any change in the terms of the Rental Agreement (including any Rent decrease or Rent increase) as required by Civil Code Section 827.

(5) “Base Year” shall mean the 2022 calendar year.

(6) "City Council" shall mean the City Council of the City of Concord.

(7) "City" shall mean the City of Concord.

(8) "Code" shall mean the Concord Municipal Code.

(9) "Covered Rental Unit" shall mean a Dwelling Unit located within the City not specifically exempted under Section 19.40.020(a) or 19.40.020(b).

(10) "CPI" shall mean Consumer Price Index for all urban consumers for the San Francisco-Oakland-Hayward, California area, or any successor designation of that index that may later be adopted by the U.S. Department of Labor for April of each year. Calculation of the CPI percentage will be determined by the City and set forth in its procedures and guidelines.

3 (11) “Disabled” shall mean any mental or physical disability as defined in Government Code Section 12955.3. A “Disabled Tenant” is a Tenant who is disabled.

(12) "Dwelling Unit" shall mean a dwelling unit, as defined under California Civil Code Section 1940(c), including joint living and work quarters, that is used or occupied in consideration of payment of Rent, and applies to any dwelling space that is actually used for residential purposes, whether or not the residential use is legally permitted, including live-work spaces, mobilehomes rented to a Tenant, and any Accessory Dwelling Unit in the City.

(13) "Ellis Act" shall mean California Government Code Sections 7060 – 7060.7.

(14) “Fair Return Petition” shall mean a petition filed by a Landlord seeking a Fair Return Rent Increase pursuant to Section 19.40.050.

(15) “Fair Return Rent Increase” shall mean the amount by which Base Rent plus any Allowable Annual Rent Increase may be increased in accordance with an approved Fair Return petition submitted pursuant to Section 19.40.050.

(16) “Hearing Officer” shall mean an official appointed by the City Attorney to conduct an administrative hearing pursuant to this Chapter.

(17) "Housing Services" include, but are not limited to, repairs, maintenance, painting, providing light, heat, hot and cold water, elevator service, window shades and screens, storage, kitchen, bath and laundry facilities and privileges, janitor services, access to exterior doors, entry systems and gates, utilities (unless separately metered and billed to the Tenant by the utility company since the inception of the Tenancy, as provided in the Rental Agreement), refuse removal, furnishings, telephone, parking, the right to have a specified number of occupants or tenants, the right to have pets, utility infrastructure, and any other benefit, privilege or facility connected with the use or occupancy of any Dwelling Unit.

(18) “HUD FMR Rent” shall mean the fair market rent published by the U.S.

Department of Housing and Urban Development for the applicable year for Contra Costa County.

(19) “Initial Allowable Annual Rent Increase” shall mean sixty percent (60%) of the CPI increase for the twelve-month period from April 2022 to April 2023, which equals 2.52%.

(20) "Landlord" or “Owner” shall mean any person, acting as principal or through an agent, having the right to offer a Dwelling Unit for rent, and includes a sublessor, except that this term does not include the Owner or operator of a mobile home park or his or her agent, but does include the Owner of a mobile home if the mobile home is offered for rent.

(21) "Landlord's Family Member" shall mean a Landlord's parent, child, spouse or registered domestic partner, grandparent, grandchild.

(22) “Lawful Rent” shall mean the Base Rent for a Covered Rental Unit as such Base Rent may be increased by any Annual Allowable Rent Increase and any Fair Return Rent Increase permitted by this Chapter. Lawful Rent expressly excludes any Unlawful Rent.

(23) “Lawful Rent Increase” shall mean the Annual Allowable Rent Increase together with any Fair Return Rent Increase permitted for the Covered Rental Unit as specified in this Chapter. Lawful Rent Increase expressly excludes any Unlawful Rent increase.

(24) “Lower-Income Tenant” shall mean a person and family whose income does not exceed the qualifying limits for lower income families as established and amended from time to

4 time pursuant to Section 8 of the United States Housing Act of 1937, or as otherwise defined in California Health and Safety Code Section 50079.5.

(25) “Moving Stipend” is defined in Section 19.40.080(a)(2)d.

(26) “Property” shall mean the real property on which the Dwelling Unit or Units are located. For purposes of the Ellis Act evictions only, “Property” shall mean the parcel on which the Accommodations are located.

(27) “Protected Tenant” shall mean any Lower-Income Tenant, Disabled Tenant, Senior Tenant, Terminally Ill Tenant, and any Tenant whose household contains School-Aged Children.

(28) "Rent" shall mean all payments and all nonmonetary consideration including, but not limited to, the fair market value of goods, labor performed or services rendered to or for the benefit of the Landlord under a Rental Agreement concerning the use or occupancy of a Dwelling Unit and premises and attendant Housing Services, including all payment and consideration demanded or paid for parking, utility charges, pets, furniture, and other benefits, privilege or facility connected with the use or occupancy of the Dwelling Unit.

(29) "Rental Agreement" shall mean an oral or written lease, sublease, or similar agreement between a Landlord and a Tenant for the lawful occupancy of a Dwelling Unit.

(30) “School-Aged Child” or “School-Aged Children” shall mean any dependent child under the age of eighteen (18) living in the Tenant’s Covered Rental Unit and who attends a Mount Diablo Unified School District public school.

(31) “School Year” shall mean the first day of instruction for the fall semester through the last day of instruction for the Spring semester, as posted on the Mount Diablo Unified School District website.

(32) “Senior Tenant” shall mean a Tenant who is at least sixty-two (62) years of age or older as defined in Government Code Section 7060.4.

(33) "State" shall mean the State of California.

(34) “Substantial Remodel” or “Substantially Remodel” shall mean either of the following that cannot be reasonably accomplished in a safe manner that allows the Tenant to remain living in the Covered Rental Unit and that requires the Tenant to vacate the Covered Rental Unit for at least thirty (30) consecutive days: (i) the replacement or substantial modification of any structural, electrical, plumbing, or mechanical system that requires a permit from a governmental agency; or (ii) the abatement of hazardous materials, including lead-based paint, mold, or asbestos, in accordance with applicable federal, State, and local laws. Cosmetic improvements alone, including painting, decorating, and minor repairs, or other work that can be performed safely without having the Covered Rental Unit vacated, do not qualify as substantial remodel.

(35) "Tenancy" shall mean the lawful occupation of a Dwelling Unit and includes a lease or a sublease.

(36) "Tenant" shall mean a tenant, subtenant, lessee, sublessee, or any other person entitled under the terms of a Rental Agreement to the use or occupancy of any Dwelling Unit.

(37) “Terminally Ill Tenant” shall mean a Tenant who has a terminal disease as defined in California’s End of Life Option Act as any “incurable and irreversible disease that has been

5 medically confirmed and will, within reasonable medical judgment, result in death within six months” pursuant to Health and Safety Code Section 443.1 and which is verified in writing by the Tenant’s medical care provider.

(38) “Unlawful Rent” shall mean any Rent charged by a Landlord to or paid by a Tenant for a Covered Rental Unit which exceeds the Tenant’s Base Rent together with any Lawful Rent Increase.

(d) Citation. This Chapter may be referred to as the “Residential Tenant Protection Program” of the City. The words “this Chapter” and “this Ordinance” are used interchangeably herein.

19.40.020 General Applicability of Chapter; Exemptions.

This Chapter shall apply to all Landlords and Tenants in Dwelling Units within the jurisdictional limits of the City, unless otherwise exempted by State law or the provisions of this Chapter. (a) Fully Exempt (Exempt from Both Rent Stabilization and Just Cause for Eviction). The following Dwelling Units are exempt from all provisions of this Chapter:

(1) Units in Hotels as defined in Code Section 18.20.010 which, for convenience, reads as follows:

“Hotel” or “motel” means a facility that provides guest rooms or suites, with or without kitchen facilities, rented to the public for transient lodging. These facilities typically include a variety of services in addition to lodging, such as restaurants, meeting facilities, spas or other personal services, and accessory guest facilities including swimming pools, sport courts, exercise facilities, and accessory retail sales.

This classification does not include rooming houses, boardinghouses, or private residential clubs (see “Group housing” under “Residential Facility,” and “Bed and breakfast inn”)

For purposes of this Chapter only, “Hotel” or “motel” does not include short-term rentals arrangements in which a Dwelling Unit is hired or occupied by reason of concession, permit, right of access, license, or other agreement for a period of 30 consecutive calendar days or less, counting portions of calendar days as full days.

(2) Institutional Facilities. Housing accommodations in a hospital, religious facility, extended care facility, licensed residential care facility for the elderly, as defined in Section 1569.2 of the Health and Safety Code, or an adult residential facility, as defined in Chapter 6 of Division 6 of Title 22 of the Manual of Policies and Procedures published by the State Department of Social Services.

(3) Dormitories owned and operated by an institution of higher education or a kindergarten and grades 1 to 12 inclusive, school.

(4) Government Owned. Housing accommodations which are owned by a public agency or authority, or which are specifically exempted under State or federal law or administrative regulation.
(5) Dwelling Units in which the Tenant shares bathroom or kitchen facilities with the Owner who maintains their principal residence at the Property.

(6) Emergency shelters, and homeless shelters as defined in Code Section 18.200.070.

(7) Residential facility/ies, as defined in Code Section 18.20.020.

6 (8) Accessory Dwelling Units.

(9) A property containing two separate dwelling units within a single structure in which the owner occupied one of the units as the owner’s principal place of residence at the beginning of the tenancy, so long as the owner continues in occupancy, and neither unit is an accessory dwelling unit or a junior accessory dwelling unit.

(b) Partially Exempt (Exempt from Rent Stabilization but subject to Just Cause for Eviction).

The following Dwelling Units are exempt from all Rent Stabilization provisions of this Chapter:

(1) Dwelling Units that are expressly exempt under State or federal law. This includes any Dwelling Unit that has a certificate of occupancy or equivalent permit for residential occupancy issued after February 1, 1995. For this purpose, a certificate of occupancy is the certificate issued before the Property is used for any residential purposes.

(2) Any Dwelling Unit that is alienable separate (i.e., separately transferrable) from the title to any other Dwelling Unit, or is a subdivided interest in a subdivision, as specified in California Business and Professions Code Section 11004.5(b), (d), or (f), including without limitation single family residences and condominiums, but excluding mobile homes offered for rent.

(3) Dwelling Units that are either restricted by the City or other governmental agency as affordable housing for persons or families of very low, low, or moderate income, as defined in Section 50093 of the Health and Safety Code to the extent that such Dwelling Units are subject to rent increase restrictions equal to or less than five percent (5%) annually and enforceable by the City or other governmental agency pursuant to a deed, regulatory restriction contained in an agreement, or other recorded document.

19.40.030 Rent Stabilization.
(a) Subject to Section 19.40.020, no Landlord shall charge Rent in an amount that exceeds the Base Rent plus any Lawful Rent Increases permitted by this Chapter.

19.40.040 Permitted Rent Increases for Covered Rental Units. (a) A Landlord may, but shall not be obligated to, impose the Initial Allowable Annual Rent Increase or any other an annual Rent increase for any Covered Rental Unit, as allowed in this Section 19.40.040 after providing prior written notice to the Tenant of the Rent increase pursuant to California Civil Code Section 827, as may be amended.

(b) Notwithstanding the foregoing, a Landlord shall be prohibited from imposing an Allowable Annual Rent Increase, unless the Covered Rental Unit is registered with the City pursuant to Section 19.40.060, and the Landlord is not delinquent in registry fees, accrued interest, fines, and penalties pursuant to former Section 19.40.110 (Rent Registry) and/or Section

19.40.060, as applicable.

(c) Allowable Annual Rent Increases. This Chapter shall limit annual Rent increases on Covered Rental Units to no more than sixty percent (60%) of the percentage increase in CPI published and reported for the twelve-month period ending as of April of the immediately- preceding year, provided however in no event shall the Allowable Annual Rent Increase exceed three percent (3%). In the event that the percentage change in the CPI is negative, the Allowable Annual Rent Increase shall be zero percent (0%) The Allowable Annual Rent Increase shall be

7 rounded to the nearest one-quarter of a percent (0.25%). Nothing in this subsection is intended to alter the requirement that a Landlord provide a Tenant with valid, written notice of any Rent increase as required by Civil Code Section 827.

(d) Only one Allowable Annual Rent Increase and one Fair Return Rent Increase (if and to the extent approved by the Hearing Officer) may be imposed on a Covered Dwelling Unit in any twelve (12) month period, unless otherwise permitted by this Chapter.

(e) Rent Increase Following Vacancy (Vacancy Decontrol). When a Tenant has voluntarily vacated, abandoned, or been legally evicted from a Covered Rental Unit, the Landlord may set the initial Rent for the next Tenant, without restriction, at the commencement of the new Tenancy.

(f) Allowable Annual Rent Increase Banking Prohibited. A Landlord who seeks to raise Lawful Rent by the Allowable Annual Rent Increase must do so within the twelve-month period between August 1 of the current year and July 31 of the following year. A Landlord who does not impose an Allowable Annual Rent Increase or any portion thereof in the applicable twelve month period automatically waives that Allowable Annual Rent Increase or the remaining portion of that Allowable Annual Rent Increase for the remainder of the Tenancy.

19.40.050 Rent Adjustment Petitions.
(a) Fair Return Petitions. Landlords who believe they are not receiving a fair return on their Property may submit a Fair Return Petition to the City to request an increase in Rent beyond that which is permitted under Section 19.40.040.

(1) Nothing in this Section 19.40.050 shall be interpreted to authorize any Lawful Rent Increase in any twelve month period for a Covered Rental Unit in excess of the amount authorized pursuant to California Civil Code Section 1947.12, as may be amended. If a Hearing Officer awards a Landlord a Fair Return Rent Increase in excess of the maximum allowable Rent increase pursuant to Civil Code Section 1947.12, the Landlord may carry forward any portion of the Fair Return Rent Increase that could not be taken to a subsequent year until the full Fair Return Rent Increase is imposed.

(2) No Fair Return Petition shall be deemed submitted or accepted until the Landlord has registered the Property and paid all current and past-due registration fees for the Property pursuant to former Section 19.40.110 (Rent Registry) and/or current Section 19.40.060, as applicable.

(3) No Fair Return Rent Increases shall become effective until all of the following have occurred:

a. The Landlord has provided written notice of the Fair Return Rent Increase for the Covered Rental Unit in accordance with California Civil Code Section 827, as may be amended;

b. After a hearing is held, the Hearing Officer, in a written decision, grants the Fair Return Rent Increase; and

c. All amounts due and payable to the City in connection with the Fair Return Petition and hearing have been paid in full.

(4) Standard for Approving a Fair Return Petition.

8 a. Fair Return. The Landlord has the right to obtain a net operating income equal to the Base Year net operating income adjusted by the percentage increase in the CPI since the Base Year. It shall be presumed that this standard provides a fair return. The current year CPI shall be the annual CPI for the calendar year preceding the calendar year the Fair Return Petition is filed. The Hearing Officer shall make a determination whether the Landlord will receive a fair return under this standard. In evaluating whether or not the Landlord is receiving a fair return on their investment, the Hearing Officer may consider other relevant factors without limitation.

b. Base Year Net Operating Income. The Base Year and current year net operating income shall be determined by subtracting the actual operating expenses for the Base Year from the gross income realized during the Base Year. The Landlord shall provide evidence of gross income, operating expenses, and the determination of net operating income for the Base Year and current year. All figures shall be certified by the Landlord under penalty of perjury as true and correct and with respect to expenses and income used to determine gross income, as permitted pursuant to Section 19.40.050(a).

c. Rebuttal Of Base Year Net Operating Income Presumption. Any party to the hearing may present evidence to rebut the presumption of fair return based upon the Base Year net operating income, and the Hearing Officer may adjust said net operating income accordingly if at least one of the following findings is made:

(i) The Landlord’s operating expenses in the Base Year were unusually high or low in comparison to other years. In such instances, adjustment may be made in calculating operating expenses so the Base Year operating expenses reflect average expenses for the Property over a reasonable period of time. The Hearing Officer shall consider the following factors in making this finding:
(a) Extraordinary amounts were expended for necessary
maintenance and repairs;

(b) Maintenance and repair was below accepted standards so as to cause significant deterioration in the quality of services provided;

(c) Other expenses were unreasonably high or low in
comparison to prudent business practices;

(d) Costs of debt service paid during the Base Year, where the proceeds of the debt were used for capital improvements or rehabilitation in the Property.
(ii) T he gross income during the Base Year was disproportionate. In such instances, adjustments may be made in calculating gross income consistent with the purposes of this section. The Hearing Officer shall consider the following factors in making this finding:
(a) The gross income during the Base Year was lower than it might have been because some Tenants were charged reduced Rent;

(b) The gross income during the Base Year was significantly lower than normal because of the destruction of the premises and/or Page 22 of 285 9 temporary eviction or vacancies for a Substantial Remodel, construction, or repairs.
(iii) T he Rent charged by the Landlord in the Base Year were significantly below the HUD FMR Rent for the most similar unit type.

d. Determination Of Current Net Operating Income. The net operating income as of the date of filing a Fair Return Petition shall be determined by:

(i) Annualizing the Rent in effect as of the date of filing to determine the annualized gross income;
(ii) Determining the operating expenses during the immediately preceding calendar year;
(iii) Subtracting the operating expenses determined pursuant to Subsection (ii) from the annualized gross income.
e. Calculation Of Gross Income.

(i) For the purposes of determining the net operating income, gross income shall be the sum of the following:

(a) Gross Rent calculated as gross rental income at one hundred percent (100%) occupancy, adjusted for uncollected Rent as provided in Section 19.40.050(a)(4)e.(ii);

(b) Income from any laundry facilities and parking fees;

(c) All other income or consideration received or receivable in connection with the use or occupancy of the Covered Rental Unit. (ii) G ross Rent shall be adjusted for uncollected Rent due to vacancy and bad debts to the extent such are beyond the control of the Landlord.

No such adjustment shall be greater than three percent (3%) of gross Rent unless justification for a higher rate is demonstrated by the Landlord. f. Calculation Of Operating Expenses.

(i) For the purposes of determining net operating income, operating expenses shall include the following:
(a) Reasonable costs of operation and maintenance.

(b) Utility costs to the extent they are not paid by the Tenants.

(c) Landlord-performed labor compensated at reasonable
hourly rates. No Landlord-performed labor shall be included as an operating expense unless the Landlord submits documentation showing the date, time and nature of the work performed. There shall be a maximum allowed under this provision of five percent Page 23 of 285 10 (5%) of gross income unless the Landlord shows greater services were performed for the benefit of the Tenants.

(d) Real property taxes and assessments.
(ii) O perating expenses shall not include the following:
(a) Mortgage principal or interest payments or other debt service costs or lease payments;

(b) Any penalties, fees or interest assessed or awarded for violation of any provision of this Chapter or of any other provision of law;

(c) Legal fees except as specified in Section

19.40.050(a)(4)f.(iii);

(d) Political contributions;

(e) Any expenses for which the Landlord has been or will be reimbursed by any discount, security deposit, insurance payment or settlement, judgment for damages, settlement or any other method or device;

(f) Avoidable and unnecessary expense increases since the Base Year;

(g) Depreciation;

(h) Expenses which are excessive in relation to the customary and reasonable costs of such items;

(i) The costs of capital improvements associated with the purchase and/or installation of separate meters or service unless the Landlord can demonstrate that such improvements benefit the Tenants;
(iii) L egal expenses allowed in the calculation of operating expenses shall include: attorneys’ fees and costs incurred in connection with successful good-faith attempts to recover Rent owing, successful good- faith unlawful detainer actions not in derogation of applicable law, and legal expenses necessarily incurred in dealings with respect to the normal operation of the Property to the extent such expenses are not recovered from adverse or other parties. Attorneys’ fees incurred in relation to the administrative or judicial proceedings in connection with Section

19.40.050(a) are not allowable as operating expenses.
g. Determination of Fair Return Rent Increase.

(i) The Hearing Officer shall set the Fair Return Rent Increase in the amount required to provide the Landlord with a fair return. (ii) In determining the Fair Return Rent Increase required to provide the Landlord with a fair return, the following shall be determined:

11 (a) The fair return in accordance with Section

19.40.050.a.(4)(a);

(b) The gross income required to produce the fair return;

(c) The rent increase needed to produce the required gross income.
(5) N otices Upon Submitting Petition.

a. Within five (5) calendar days after submission of a Landlord's Fair Return Petition to the City, the Landlord shall serve each affected Tenant with a notice of the Fair Return Petition via personal service or certified mail.

b. Within ten (10) calendar days after service on each affected Tenant, the Landlord shall file with the City a proof of service, signed under penalty of perjury, stating that a copy of the petition was served upon each affected Tenant.

(b) Tenant Petitions. If a Landlord demands or retains Unlawful Rent for a Covered Rental Unit, a Tenant may file a petition to adjust the Rent to its lawful level.

(1) Unlawful Rent. If a Tenant believes that the Landlord is demanding Unlawful Rent for a Covered Rental Unit, then the Tenant may submit a Tenant petition to the City.

(2) Decrease in Housing Services. A decrease in Housing Services of a Covered Rental Unit, without a corresponding reduction in Rent, is considered an increase in Rent.

Before filing a petition with the City, a Tenant shall provide the Landlord all of the following (copies of which must be submitted with the Tenant petition):

a. Prior written notice identifying the decrease in Housing Services of a Covered Rental Unit; and

b. A reasonable opportunity to correct the issue(s).

(3) Notices Upon Submitting Petition.

a. Within five (5) calendar days after submission of a Tenant petition for rent adjustment to the City, the Tenant shall serve the Landlord with said petition via personal service or certified mail.

b. Within ten (10) calendar days after service on the Landlord, the Tenant shall file with the City a proof of service, signed under penalty of perjury, stating that a copy of the petition was served on the Landlord.

(c) Petition Forms. Fair Return and Tenant petitions must be filed on petition forms prescribed by the City and accompanied by such supporting material as the City may require.

Each petition shall be made under penalty of perjury.

(d) Petition Fees.

(1) Fair Return Petitions.

a. Landlords filing a Fair Return Petition shall be responsible for all City costs associated with such petition, including, but not limited to the cost of the

12 Hearing Officers, any costs associated with experts, inspection fees, and any other costs. The City shall provide the Landlord with an estimate of the costs at least 45 calendar days prior to the first date set for the hearing. The Landlord shall deposit with the City the full estimated cost of the hearing at least 30 calendar days prior to the first date set for the hearing. If the deposit is not timely received by the City, the hearing will be postponed, and the hearing shall not be rescheduled until such time as the deposit is received. City shall have the right to deduct costs incurred from the deposit. Upon the completion of the hearing, the City shall prepare a final invoice of hearing costs.

b. To the extent that the final invoice amount exceeds the amount deposited by the Landlord, the Landlord shall pay the difference to the City within 10 days of receipt of the final invoice. To the extent the final invoice amount is less than the amount deposited by the Landlord, the City shall issue a refund to the Landlord for the difference.

c. The City will not issue the Hearing Officer’s final decision until the City has received full payment of the final invoice, and no Fair Return Rent Increase, if approved, may be imposed until full payment is received by the City.

(2) Tenant Petitions. There shall not be any fee charged for Tenants filing a petition for a downward adjustment of Rent.

(e) Hearing Process.

(1) Upon receipt of a Fair Return or Tenant petition and the proof(s) of service that the petition has been served as provided above, the City shall appoint a Hearing Officer to conduct a hearing on the petition and to render a final decision on the merits of the petition, subject to this Chapter and any procedures, regulations, and guidelines promulgated by the City Manager.

(2) Each party to a petition shall receive sufficient advance notice of the time, date, and place of any hearing regarding the petition.

(3) The Hearing Officer may require either party to a petition to provide any books, records, and papers deemed pertinent.

(4) If the Hearing Officer finds good cause to believe that a building or other inspection would assist in resolving the issues raised in the petition, the Hearing Officer may conduct an inspection and/or request that the City conduct an inspection. Any party submitting a petition shall be required to cooperate with the City to grant and/or secure permission to conduct such inspection, within the constraints of applicable law; failure to do so shall be considered an automatic and voluntary withdrawal of that party’s petition upon written notice by the City thereof. The parties to the petition may be present during the inspection.

(5) All hearings conducted pursuant to this Chapter shall be open to the parties and their designated representatives, but shall not be open to the public.

(f) Assistance or Representation Authorized. All parties to a petition may seek assistance from attorneys, recognized tenant organization representatives, or any other person designated by said parties.

13 (g) Consolidation. All Fair Return Petitions pertaining to Tenants in the same Property shall be consolidated for determination. Tenant petitions for Rent adjustment from Tenants residing in the same Property may be consolidated at the election of the City, in its sole discretion.

(h) Quantum of Proof and Notice of Decision. No petition shall be granted unless supported by the preponderance of the evidence submitted prior to and at the hearing. All parties to the petition shall be sent notice of the decision.

(i) Finality of Decision. The decision of the Hearing Officer shall be the final decision and shall not be appealable to the City Council. Any party disputing the final conclusions and findings of the Hearing Officer may seek review pursuant to Code of Civil Procedure Sections 1094.5 and 1094.6.

(j) Time of Hearing and Decision. The City shall not be required to accept petitions until September 1, 2024. The City shall endeavor, but shall not be required, to schedule a hearing on a petition within ninety (90) days after submittal to the City of the petition and the proof(s) of service. A final decision on a petition shall be made within a reasonable time after the conclusion of the hearing.

19.40.060 Annual Rental Registration.
(a) Registration of Covered Rental Unit. On or before July 1 of each year, a Landlord shall register any Covered Rental Unit through the City’s designated rent registry portal, shall provide all required information, shall pay the required rent registry fees, and shall annually submit reports. To the extent that a Landlord has previously complied with the requirements of former Section 19.40.110 (Rent Registry), the Landlord shall on or before July 1, 2024, update the registration previously completed pursuant to former Section 19.40.110 to comply with the requirements of this Chapter.

(b) Rent Registry Fees. A Landlord shall pay the required rent registry fees as set forth in the City Council adopted Resolution Establishing Fees and Charges for Various Municipal Services.

The fees will be used to finance the cost of the rent registry and implementation and enforcement of this Chapter including, but not limited to, administrative time and costs, legal fees and costs, and any other expense incurred to implement, administer, or enforce this Chapter.

(c) Late Fees, Penalty For Late Payment; Penalty For Incomplete Or False Information.

Should a Landlord fail to pay all or a portion of the rent registry fees, or provide incomplete or false information, the City may recover the outstanding amounts, plus accrued interest, fines, and penalties, utilizing any remedies provided by law or in equity, including municipal tax lien procedures established by ordinance or State law. Such sums shall be calculated as set forth in the Resolution Establishing Fees and Charges for Various Municipal Services and applicable law, may be applied on a per-unit basis, and may be subject to adjustment by the City Attorney or Hearing Officer.

(d) Past Due Amounts. To the extent that a Landlord owes rental registry fees, accrued interest, fines, or penalties incurred prior to the effective date of this Ordinance, such amounts shall continue to be owed and continue to accrue. See also Sections 19.40.040(b) and

19.40.050(a)(2).

14 19.40.070 Just Cause for Eviction.
(a) This Section 19.40.070 shall apply to all Landlords and Tenants in Dwelling Units within the jurisdictional limits of the City, unless otherwise exempted by State law or the provisions of this Chapter.

(b) When terminating a Tenancy For Cause or No-Fault, a Landlord must comply with all of the following:

(1) The Landlord must serve a written notice, to the Tenant that, in addition to any information required by federal or State law, the Landlord will terminate the Tenant's Tenancy because of at least one For Cause or No-Fault reason and state the ground(s) for such termination as described in Section 19.40.070(c) and/or (d);

(2) The Landlord has not accepted and will not accept Rent or any other consideration in return for the continued use of the Covered Rental Unit beyond the term of the terminated Tenancy; and

(3) The Landlord qualifies the termination as For Cause or No-Fault, as specified in this Section 19.40.070.

(c) For Cause Termination of Tenancy. If a Landlord can show any of the following circumstances with respect to a termination of Tenancy in a Covered Rental Unit, the termination qualifies as a For Cause Termination:

(1) Default in the payment of Rent.

(2) A breach in the material term of the Rental Agreement, as described in paragraph (3) of Section 1161 of the Code of Civil Procedure, including, but not limited to, violation of a provision of the Rental Agreement after being issued a written notice to correct the violation.

(3) Maintaining, committing, or permitting the maintenance or commission of a nuisance as described in paragraph (4) of Section 1161 of the Code of Civil Procedure.

(4) Committing waste as described in paragraph (4) of Section 1161 of the Code of Civil Procedure.

(5) The Tenant had a written Rental Agreement, and after a written request or demand from the Landlord, the Tenant has refused to execute a written extension or renewal of the Rental Agreement for an additional term of similar duration with similar provisions, provided that those terms do not violate this Chapter or any other provision of law.

(6) Criminal activity by the Tenant in the Covered Rental Unit or on the Property, including any common areas, or any criminal activity or criminal threat, as defined in subdivision (a) of Section 422 of the Penal Code, or criminal activity by the Tenant on or off the Property that is directed at other Tenants or the Landlord.

(7) Assigning or subletting the Covered Rental Unit in violation of the Rental Agreement, as described in paragraph (4) of Section 1161 of the Code of Civil Procedure.

(8) The Tenant’s refusal to allow the Landlord to enter the Covered Rental Unit as authorized by Sections 1101.5 and 1954 of the Civil Code, and Sections 13113.7 and 17926.1 of the Health and Safety Code.

15 (9) Using the Covered Rental Unit or any portion of the Property for an unlawful purpose as described in paragraph (4) of Section 1161 of the Code of Civil Procedure.

(10) The employee, agent, or licensee’s failure to vacate after their termination as an employee, agent, or a licensee as described in paragraph (1) of Section 1161 of the Code of Civil Procedure.

(11) When the Tenant fails to deliver possession of the Covered Rental Unit after providing the Landlord written notice as provided in Section 1946 of the Civil Code of the Tenant’s intention to terminate the hiring of the Covered Rental Unit, or makes a written offer to surrender the Covered Rental Unit that is accepted in writing by the Landlord, but fails to deliver possession at the time specified in that written notice as described in paragraph (5) of Section 1161 of the Code of Civil Procedure.

(d) No-Fault Termination of Tenancy. If a Landlord can show any of the following circumstances with respect to a termination of Tenancy in a Covered Rental Unit, the termination qualifies as a No-Fault termination. See Section 19.40.070(e) for Right of Return provisions.

See Section 19.40.080 for Rental Assistance and Moving Stipend provisions.

(1) Owner Move Ins. Intent to occupy the Covered Rental Unit by the Landlord or the Landlord’s Family Member.

a. A Landlord may not terminate a Tenancy based on intent to occupy the Covered Rental Unit by the Landlord or the Landlord’s Family Member if the intended occupant already occupies a Dwelling Unit on the Property or if a vacancy of a similar Dwelling Unit already exists at the Property.

b. The written notice terminating a Tenancy pursuant to this subparagraph shall contain the name or names and relationship to the Landlord of the intended occupant. The written notice shall additionally include notification that the Tenant may request proof that the intended occupant is a Landlord or the Landlord’s Family Member. The proof shall be provided upon request and may include an operating agreement and other non-public documents.

c. This subparagraph (1) only applies if the intended occupant moves into the Covered Rental Unit within ninety (90) days after the Tenant vacates and occupies the Covered Rental Unit as a primary residence for at least __________(__) consecutive months.

d. A Landlord shall only be allowed to terminate a Tenancy pursuant to this Subsection 19.40.070(d)(1) if the Landlord meets one of the following:

(i) is a natural person that has at least __ percent recorded ownership interest in the Property;

(ii) is a natural person who has any recorded ownership interest in the Property if one hundred percent (100%) of the recorded ownership interest is divided among owners who are related to each other as sibling, spouse, domestic partner, child, parent, grandparent, or grandchild; or

(iii) is a natural person whose recorded interest in the Property is owned through a limited liability company or partnership.

e. Owner Move-In Protections for Senior, Disabled, and Terminally Ill Tenants. A Landlord may not evict a Tenant in order to occupy the Covered

16 Rental Unit by the Landlord or the Landlord’s Family Member, if the Tenant has resided in the Dwelling Unit for at least three years and is either a Senior Tenant, a Disabled Tenant, or a Terminally Ill Tenant, unless the Landlord or Landlord’s Family Member who will occupy the Covered Rental Unit is either a Senior Tenant, a Disabled Tenant, or a Terminally Ill Tenant, and no other Covered Rental Units are available at the Property.

f. As used in this Subsection 19.40.070(d)(1):

(i) “Natural person” includes any of the following:
(a) a natural person who is a settlor or beneficiary of a family trust; or
(b) if the Property is owned by a limited liability company or partnership, a natural person with a __-percent ownership interest in the Property.

(ii) “Family trust” shall mean a revocable living trust or irrevocable trust in which the settlors and beneficiaries of the trust are persons who are related to each other as sibling, spouse, domestic partner, child, parent, grandparent, or grandchild.

(2) Ellis Act Evictions. Withdrawal of all Accommodations at the Property from the rental market is subject to the following conditions and requirements pursuant to the Ellis Act:

a. Landlord complies with all provisions of the Ellis Act, unless otherwise indicated in Section 19.40.070(d)(2).

b. Not less than one hundred twenty (120) days from the date the Landlord intends to withdraw the Accommodations, and after completion of all required proceedings, if any, the Landlord shall provide written notice of termination of Tenancy to all affected Tenants.

c. Landlord's notice to all affected Tenants shall contain the following information:

(i) That the Landlord is evicting the Tenant pursuant to this Section

19.40.070(d)(2);

(ii) That within thirty (30) days of receipt of notice to terminate, the Tenant may notify the Landlord in writing that the Tenant would be interested in re-renting the Covered Rental Unit if any of the Covered Rental Units are re-offered for rent at a future time and advising the Tenant to notify the Landlord of future address changes;

(iii) A general description of the Tenant's rights to relocation assistance and any other rights set forth in this Chapter and the Ellis Act (relocation assistance and any additional special assistance shall be paid in accordance with Section 19.40.080);

(iv) Any other information required pursuant to Civil Code Sections 7060.4 and

17 (v) A self-addressed stamped postcard on which the Tenant may indicate, under penalty of perjury, whether they or another Tenant in the Covered Dwelling Unit are a Disabled Tenant or Senior Tenant.

d. A Senior Tenant or a Disabled Tenant who has resided in the Covered Rental Unit for at least one (1) year prior to the Landlord's notice of intent to withdraw the Covered Rental Unit in a Property from the residential rental market, and after receiving one hundred twenty (120) days written notice, may within sixty (60) days of receipt of the written notice of termination submit a written notice to the Landlord of Tenant’s status as a Senior or Disabled Tenant, in which event the notice of termination shall be extended to one year from the date of delivery of the notice pursuant to 19.40.070(d)(2)(c).

e. To the fullest extent permitted by law, the City adopts all tenant protections authorized by the state legislature in the following provisions of the Ellis Act: California Government Code Sections 7060.2, 7060.3, 7060.4, 7060.6, and this subdivision shall be interpreted to implement all available tenant protections in the aforementioned sections of the Government Code, as they exist as of the effective date of this Chapter. See also Section 19.40.070(e)(2) for Ellis Act right of return provisions. See Section 19.40.120(a)(3) for Ellis Act remedies, including exemplary damages.

f. Recordation of Notice:

(i) The City shall prepare a form notice consistent with Government Code Section 7060.3, and which shall specifically describe the Property where the Covered Rental Units are located, the dates applicable to the constraints and the name of the owner of record of the Property.

(ii) Any Landlord withdrawing a Property containing Covered Rental Units from the rental market shall complete such notice and shall serve such notice on the City concurrent with providing notice to the Tenants of the Landlord's intent to withdraw the Covered Rental Units from the residential rental market. The notice shall be executed by the fee owner(s) of the Property, and all such signatures shall be duly notarized.

(iii) City shall record the notice with the County Recorder. Such notice encumbers the Property for ten (10) years from the date the Accommodations are withdrawn from rent or lease.

(3) Government Orders. The Landlord is complying with any of the following:

a. An order issued by a government agency or court relating to habitability that necessitates vacating the Covered Rental Unit; or

b. An order issued by a government agency or court to vacate the Covered Rental Unit; or

c. A local ordinance that necessitates vacating the Covered Rental Unit.

(4) Intent to Demolish/Substantially Remodel. Intent to demolish or to Substantially Remodel the Covered Rental Unit.

a. For purposes of this subparagraph, a Tenant is not required to vacate the Covered Rental Unit on any days where a Tenant could continue living in the

18 Covered Rental Unit without violating health, safety, and habitability codes and laws.

b. In order to terminate a Tenancy based on intent to demolish or to Substantially Remodel the Covered Rental Unit pursuant to this subparagraph, a Landlord must provide the Tenant with written notice pursuant to Civil Code Section 1946.1 which notice shall be in no less than 12-point type, shall be in English and Spanish and include all of the following information:

(i) A statement informing the Tenant of the Landlord’s intent to demolish the Property or Substantially Remodel the Covered Rental Unit or Property.

(ii) The following statement: “If the substantial remodel of your unit or demolition of the property as described in this notice of termination is not commenced or completed, the Landlord must offer you the opportunity to re-rent your unit with a rental agreement containing the same terms as your most recent rental agreement with the Landlord at the rental rate that was in effect at the time you vacated. You must notify the Landlord within thirty (30) days of receipt of the offer to re-rent of your acceptance or rejection of the offer, and, if accepted, you must reoccupy the unit within thirty (30) days of notifying the Landlord of your acceptance of the offer.”

(iii) A description of the Substantial Remodel to be completed, the approximate expected duration of the Substantial Remodel, or if the Property is to be demolished, the expected date by which the Property will be demolished, together with one of the following:

(a) A copy of the permit or permits (or a written commitment from the applicable governmental agency that such permits are ready to be issued subject only to conditions requiring the Property or Covered Rental Unit to be vacant) required to undertake the Substantial Remodel or demolition; or

(b) I f the notice is issued to abate hazardous materials and the remodel does not require any permit, a copy of the signed contract with the contractor hired by the Landlord to complete the Substantial Remodel, that reasonably details the work that will be undertaken to abate the hazardous materials.

(iv) A notification that the Tenant has the right to return to the Covered Rental Unit upon completion of the Substantial Remodel at the same Rent and the same lease terms subject to any Lawful Rent Increases.

(e) Tenant's Right of First Return to a Covered Rental Unit; Rent Upon Return.

(1) Owner Move In Right of Return. If the intended occupant fails to occupy the Covered Rental Unit within ninety (90) days after the Tenant vacates, or if the intended occupant fails to occupy the Covered Rental Unit as their primary residence for at least __________(__) consecutive months. If Tenant re-occupies such Covered Rental Unit, Landlord shall reimburse the Tenant for reasonable moving expenses incurred. Such payment shall be in addition to any relocation assistance that was paid to the Tenant in connection with the termination notice. To the extent permitted by State law, for a new Tenancy commenced during the time periods described in this Section 19.40.070(e)(1), the Covered Rental Unit shall be offered and rented or

19 leased at the Lawful Rent in effect at the time any notice of termination of Tenancy is served, subject to any Lawful Rent Increases.

(2) Ellis Act Right of Return.

a. If within two (2) years after withdrawing a Covered Rental Unit from the rental market pursuant to Section 19.40 070(d)(2) a Landlord offers for Rent such Covered Rental Unit, in addition to any right of return that the Tenant may have pursuant to this Chapter, the Landlord shall be liable to the Tenant who was displaced from the Covered Rental Unit actual and exemplary damages provided the Tenant brings an action against the Landlord within three (3) years of the withdrawal of the Covered Rental Unit from the rental market.

b. Return Within Five (5) Years. A Tenant of a Covered Rental Unit whose Tenancy was terminated in accordance with Section 19.40.070(d)(2) is entitled to receive notice of the first right to return to the same Covered Rental Unit at the Rent previously charged for the Covered Rental Unit, subject to any Lawful Rent Increases, and subject to the Rental Agreement terms in effect at the time the Tenant vacated. A Tenant may return to the Covered Rental Unit if:

(i) The Tenant has provided the Landlord a current mailing address and/or email address and keeps those addresses updated, at which to receive notice from Landlord that Covered Rental Unit is available; and

(ii) The Landlord returns the Covered Rental Unit to the residential rental market within five (5) years after the effective date of withdrawal of a Property containing the Covered Rental Unit from the residential rental market.

c. Return Within Ten (10) Years. A Landlord of a Property containing a Covered Rental Unit that was withdrawn from the residential rental market within the previous ten (10) years must provide one hundred twenty (120) days written notice to the previous Tenants of the Landlord's intent to return the Covered Rental Unit to the residential rental market.

d. Any Tenant displaced from a Covered Rental Unit in connection with the withdrawal of a Property containing a Covered Rental Unit from the residential rental market may request the first right of return from the Landlord within thirty (30) days of receipt of a Landlord's written notice of intent to return the Covered Rental Unit to the residential rental market.

(3) Government Order Right of Return. The Landlord must give advance notice to the Tenant of the Tenant’s right to reoccupy the Covered Rental Unit if the and when the Covered Rental Unit is found to be in compliance with the order. The Tenant shall notify the Landlord, in writing, within thirty (30) days after the receipt of such notice of the Tenant’s interest to reoccupy the Covered Rental Unit and shall provide the Landlord with their contact information.

(4) Substantial Remodel Right of Return. Tenant shall have the right to return to the Covered Rental Unit upon completion of the Substantial Remodel. The Tenant shall notify the Landlord, in writing, within thirty (30) days after the receipt of such notice of the Tenant’s interest to reoccupy the Covered Rental Unit and shall provide the Landlord with their contact information.

20 (5) Rent Upon Return. In each such instance, the Landlord shall offer and Tenant shall have the right return to the same Covered Rental Unit at the Rent previously charged for the Covered Rental Unit, subject to any Lawful Rent Increases, and subject to the Rental Agreement terms in effect at the time the Tenant vacated.

(f) School Year Evictions.

(1) It shall be a defense to a no-fault eviction if a School-Aged Child resides in the Covered Rental Unit, if the effective date of the notice of termination of Tenancy falls during the School Year.
(2) Within thirty (30) days of service of the notice of termination of Tenancy, the Tenant must submit a statement with supporting evidence to the Landlord if the Tenant claims to have a School-Aged Child residing in the Covered Dwelling Unit; this information is required in addition to Tenant’s return of the postcard referenced in Section 19.40.080(a)(1). The notice of termination of Tenancy shall contain a warning that a Tenant’s failure to submit such statement within thirty (30) days of receipt of the notice shall be deemed an admission that the Tenant is not protected from eviction pursuant to this Section 19.40.070(f). (3) A Landlord may challenge a Tenant’s claim of protected status pursuant to this Section 19.40.070(f) through commencement of the eviction proceeding.

19.40.080 Relocation Assistance For No-Fault Termination Of Tenancy; Moving Stipend.
(a) Relocation Assistance for No-Fault Terminations.

(1) For a Tenancy for which just cause is required to terminate the Tenancy under Section 19.40.070, if a Landlord issues a termination notice for a no-fault reason the Landlord shall, regardless of the Tenant’s income, assist the Tenant to relocate by providing a direct payment to the Tenant as described in Subsection (a)(3), below, and (except to the extent prohibited by applicable law) the Landlord shall notify the Tenant in writing of the Tenant’s right to relocation assistance at the time the Landlord issues the notice of termination. Each termination notice shall be accompanied by a self-addressed stamped postcard (in a format approved by the City) on which the Tenant may indicate, under penalty of perjury, whether they or another Tenant in the Covered Dwelling Unit are a Protected Tenant and under which category (i.e., Lower-Income Tenant, Disabled Tenant, Senior Tenant, Terminally Ill Tenant, School- Aged Child/ren) they claim Protected Tenant status.

(2) Permanent Relocations. When relocation assistance is required by this Section

19.40.080(a)(2) to Tenants who are evicted pursuant to Section 19.40.070(d), the Landlord must make relocation assistance payments as follows:

a. Non-Protected Tenant Relocation Assistance. If the Tenancy is terminated pursuant to Section 19.40.070(d)(1)-(3) (i.e. Owner Move-Ins, Ellis Act Evictions, Governmental Orders), or pursuant to Section 19.040.070(d)(4) (i.e. Intent to Demolish/Substantially Remodel) with the intent to demolish the Covered Rental Unit, the Landlord shall pay to the Tenant relocation assistance in the amount of three times the HUD FMR Rent for the most similar unit type based on the number of bedrooms plus the Moving Stipend. Such payment shall be calculated on a per-Covered Dwelling Unit basis, without reference to the number of Tenants in the Covered Dwelling Unit.

21 b. Protected Tenant Relocation Assistance. If one of the Tenants living in the Covered Rental Unit from which the Tenants are displaced is a Protected Tenant, then all Tenants living in the Covered Rental Unit are collectively entitled to receive supplemental relocation assistance in the amount of one additional month of the applicable HUD FMR Rent. Such payment shall be calculated on a per- Covered Dwelling Unit basis, without reference to the number of Tenants and Protected Tenants in the Covered Dwelling Unit.

c. Payment Process. For permanent relocation assistance, the Landlord shall provide one-half of the relocation assistance owed to the Tenant within 15 calendar days of service of the notice of termination. The remaining relocation assistance shall be paid to the Tenant in cash no later than the date the Tenant vacates the Covered Rental Unit.

d. Moving Stipend. The Landlord shall pay to Tenant the amount of $3,000 (“Moving Stipend”), which shall be paid to the Tenant in cash no later than the date the Tenant vacates the Covered Rental Unit. Such payment shall be calculated on a per-Covered Dwelling Unit basis, without reference to the number of Tenants in the Covered Dwelling Unit.

e. Refund of Security Deposit. A Landlord must refund to the Tenant any security deposit paid by the Tenant. A Landlord may withhold any properly itemized deductions from the security deposit in accordance with California Civil Code Section 1950.5.

(3) Temporary Relocations. A Landlord must pay temporary relocation assistance to Tenants of a Covered Rental Unit who are temporarily displaced due to Substantial Remodel of Covered Rental Unit:

a. Thirty (30) Days or Fewer. A Landlord must provide the Tenant a per diem payment if the Tenant will be temporarily displaced for thirty (30) days or fewer. The Landlord shall pay to the Tenant the full amount of the per diem payment when the Tenant temporarily vacates the Covered Rental Unit.

b. Thirty-One (31) Days or More. A Landlord must provide the Tenant either a per diem payment or, at the Landlord’s election, comparable or superior temporary housing, if available.

c. Duration Extended. In the event the duration of the temporary relocation is longer than anticipated, the Landlord shall continue to pay to the Tenant the per diem relocation assistance payments on a weekly basis or continue to provide the Tenant with the comparable or superior temporary housing until the Tenant is able to return to the Covered Rental Unit.

d. Per-Diem Amount. The per diem payment amount shall be based on the Federal General Services Administration per diem rate for lodging and meals (M&IE total) in Concord, Contra Costa County, which is updated on a yearly basis. Per diem payments for meal shall be on a per Tenant basis. Per diem payments for lodging shall be on a per-Covered Dwelling Unit basis assuming a household size of four.

e. Rent Due. For temporary relocation assistance where the Landlord is providing comparable or superior temporary housing or making a per diem payment, the Tenant shall continue to pay the Lawful Rent to the Landlord for the Covered Rental Unit.

22 f. Refund of Security Deposit. A Landlord shall not be required refund to the Tenant any security deposit paid by the Tenant in connection with a temporary relocation.

g. The phrase “comparable or superior” when used in connection with a Dwelling Unit or temporary housing shall mean a Dwelling Unit or temporary housing that is similar in size or larger, has the same number of bedrooms or additional bedrooms, is located in the City, has similar amenities as the Covered Rental Unit, such as parking, laundry facilities or exercise facilities, allows pets if the displaced Tenant has a pet, and as to a Disabled Tenant, is disability accessible and ADA compliant. The Tenant, in the Tenant’s reasonable discretion may waive any of these factors in deciding whether the Dwelling Unit or temporary housing offered is comparable or superior.

(b) No Waiver. In the event the Tenant accepts an offer to temporarily or permanently move to an available comparable or superior vacant Dwelling Unit owned by the Landlord at the same Rent, the Tenant shall not be entitled to relocation assistance pursuant to Section 19.40.080 herein, but shall be eligible for the Moving Stipend. Except as expressly provided in this Subsection 19.40.080(b), a Tenant cannot waive their right to receive relocation assistance required by this Chapter.

(c) Coordination With Other Relocation Benefits. If a Tenant receives, as part of the termination of Tenancy, relocation assistance pursuant to the California Relocation Assistance Act (Government Code Sections 7260-7277), then the amount of that relocation assistance shall operate as a credit against any relocation assistance to be paid to the Tenant under this Section

19.40.070.

19.40.090 Requirement to Offer Written Lease; Minimum Lease Terms. Tenants shall have the right to written leases and minimum lease terms, as provided herein. (a) One-Year Lease Term. If a prospective Tenant wishes to rent a Dwelling Unit from a Landlord and if said Landlord wishes to rent said Dwelling Unit to said prospective Tenant, the Landlord must offer to the prospective Tenant a written lease which has a minimum term of one year. Such offer must be made in writing. If the prospective Tenant accepts the offer of a written lease which has a minimum term of one year, this acceptance must be in writing. Signing a lease which has a minimum term of one year will be considered an offer if signed by the Landlord, and an acceptance if countersigned by the prospective Tenant. If the prospective Tenant rejects the offer for a written lease which has a minimum term of one year, such rejection must be in writing.

(b) Six-Month Lease Term. If the prospective Tenant rejects the offer for a written lease which has a minimum term of one year as provided in Section 19.40.090(a), but the prospective Tenant continues to wish to rent said Dwelling Unit from said Landlord, said Landlord must offer to said prospective Tenant a written lease which has a minimum term of six months. Such offer must be made in writing. If said prospective Tenant accepts the offer of a written lease which has a minimum term of six months, this acceptance must be in writing. Signing a lease which has a minimum term of six months will be considered an offer if signed by said Landlord, and an acceptance if countersigned by said prospective Tenant. If said prospective Tenant rejects the offer for a written lease which has a minimum term of six months, such rejection must be in writing.

(c) Shorter Term. If said prospective Tenant rejects the offer for a written lease which has a minimum term of six months as provided in Section 19.40.090(b), said Landlord and said

23 prospective Tenant may then enter into a written lease that provides for a term of fewer than six months.

(d) Renewal of Lease. If both the Landlord and Tenant wish to continue the Tenancy, upon the expiration of a Rental Agreement which has a minimum term of one year or six months, a written Rental Agreement shall be offered again in accordance with the procedures set forth in Sections 19.40.090(a)-(c). The Landlord shall have no obligation to re-offer a Tenant a one-year or six-month lease term if the Tenant has previously rejected such offers in accordance with the procedures set forth in Sections 19.40.090(a)-(c), and has a Rental Agreement with a term of fewer than six months.

(e) Existing Tenancies. Any Tenant renting a Dwelling Unit may request a written lease with a minimum term of either one year or six months, provided such Tenant has not previously received a written notice of Rental Agreement violation pursuant to Code of Civil Procedure Section 1161 and such violation remains uncured. The Tenant shall do so via written notice to the Landlord. The Landlord shall, upon receipt of such notice, offer to said Tenant a written Rental Agreement on terms substantially similar to those of the existing rental arrangement (except as to length of term) in accordance with the procedures set forth in this Section

19.40.090, as applicable.

19.40.100 Notice of Tenant Rights.
(a) A Landlord subject to this Chapter shall provide notice to the Tenant as follows:

(1) For any Tenancy commenced or renewed on or after the effective date of this Ordinance, as an addendum to the Rental Agreement, or as a written notice signed by the Tenant, with a copy provided to the Tenant.

(2) For any Tenancy existing prior to the effective date of this Ordinance, by written notice to the Tenant no later than 180 days after the effective date of the Ordinance adopting this Chapter, or as an addendum to the Rental Agreement.

(b) The notification and Rental Agreement provision shall be in no less than 12-point type, shall be in English and Spanish, and shall include the following:

Concord law limits the amount your rent can be increased. See Chapter 19.40 of the Concord Municipal Code for more information. Concord law also provides that, a Landlord must provide a statement of cause in any notice to terminate a Tenancy. See Section 19.40 070 of the Concord Municipal Code for more information. In addition, City of Concord Municipal Code Sections 19.40.070(e) and 19.40.080 provide tenants evicted on a no-fault basis with the right to return to the Tenant’s original Covered Rental Unit if such Covered Rental Unit is returned to the market, and the right to relocation assistance and a moving stipend; see City of Concord Municipal Code Sections

19.40.070(e) and 19.40.080 for more information.

City of Concord Municipal Code Section 19.40.090 provides tenants with the right to written leases and minimum lease terms. Landlords must offer tenants the option to enter into a one (1) year written lease. If a tenant declines a one (1) year written lease, the landlord must offer that tenant the option to enter into a six (6) month written lease. It is the tenant’s choice whether or not to enter into such a written lease with a landlord. If tenant rejects the initial offers of a written lease with a minimum lease term of 12 or 6 months, the tenant and landlord may enter into a written lease with a term of fewer than 6 months. See City of Concord Municipal Code Section 19.40.090 for more information.

24 (c) Manner. Landlords must provide the notice to Tenants in writing if the application and Rental Agreement are processed in writing, electronically if the application and/or Rental Agreement are processed electronically, or both if both methods are utilized. The provision of the notice shall be subject to Civil Code Section 1632.

19.40.110 Procedures and Guidelines.

The City Manager is hereby delegated the authority to promulgate procedures, regulations, and guidelines to aid in the implementation of this Chapter.

19.40.120 Remedies.
(a) Remedies and penalties.

(1) If a Landlord violates the terms of this Chapter, an aggrieved Tenant may institute a civil action for injunctive relief, actual, statutory, or direct money damages, and any other relief that the court deems appropriate, which shall include a civil penalty of no less than $2,000, and no more than $5,000, per violation, at the discretion of the court. If the aggrieved Tenant is a Senior Tenant or a Disabled Tenant, the court may award an additional civil penalty of up to $5,000 per violation, at the discretion of the court.

(2) Any person who violates, aids, abets, or incites another person to violate this Chapter is liable in a court action for each and every such offense for money damages of not less than three times actual damages suffered by an aggrieved Tenant (including damages for mental or emotional distress), or for minimum damages in the sum of $1,000, whichever is greater, and whatever other relief the court deems appropriate. In the case of an award of damages for mental or emotional distress, said award shall only be tripled if the trier of fact finds that the defendant Landlord acted in knowing violation of or in reckless disregard of this Chapter.

(3) If within two (2) years after withdrawing a Covered Rental Unit from the rental market pursuant to Section 19.40 070(d)(2) a Landlord offers for Rent such Covered Rental Unit, in addition to any right of return that the Tenant may have pursuant to this Chapter, the Landlord shall be liable to the Tenant who was displaced from the Covered Rental Unit actual and exemplary damages provided the Tenant brings an action against the Landlord within three (3) years of the withdrawal of the Covered Rental Unit from the rental market.

(b) The court may award punitive damages in a proper case as set out in Civil Code Section 3294 and pursuant to the standards set forth in that code section or any successor thereto, but may not award both punitive damages and triple damages.

(c) The court shall award reasonable attorneys’ fees and costs to a Tenant who prevails in any such action. The court shall award reasonable attorneys’ fees and costs to a Landlord who prevails in any such action if the court determines that the Tenant’s action was frivolous.

(d) The remedies available under this Section 19.40.120 shall be in addition to any other existing remedies which may be available to the residential tenant under applicable federal, State, county, or local law.

(e) Except in connection with a Fair Return Petition or a Tenant Petition, no administrative remedy need be exhausted prior to filing suit pursuant to this Chapter.

(f) Authorization of City Attorney to enforce the Ordinance. The City Attorney shall have the right and authority, but not the obligation, to enforce this Chapter, including bringing actions

25 for injunctive relief, equitable relief, restitution, and/or penalties to ensure compliance with this Chapter.

(g) To the extent permitted by law, any violation of this Chapter shall be a defense to an unlawful detainer action.

19.40.130 Waiver Prohibited.

Any waiver of rights under this Chapter shall be void as contrary to public policy.

19.40.140 Severability.

If any section, subsection, sentence, clause or phrase of this Chapter is for any reason held by a court of competent jurisdiction to be invalid, such decision shall not affect the validity of the remaining portions of this Chapter. The City Council declares that it would have adopted this Chapter and each section, subsection, sentence, clause and phrase thereof, irrespective of the fact that any one or more section, subsection, sentence, clause, or phrase be declared invalid.

1 Chapter 19.40
Residential Tenant Protection Program
Sections

19.40.010 Binding Fin
dings; Definitions; Citation.

19.40.020 General Applicability of Chapter; Exemptions.

19.40.030 Rent Stabilization.

19.40.040 Permitted Rent Increases for Covered Rental Units.

19.40.050 Rent Adjustment Petitions.

19.40.060 Annual Rental Registration.

19.40.070 Termination of TenancyJust Cause for Eviction.

19.40.080 Relocation Assistance For No-F ault Termination Of Tenancy; Notice Of Curable Lease ViolationsMoving Stipend.

19.40.090 Requirement to Offer Written Lease, Minimum Lease Terms.

19.40.100 Notice of Tenant Rights.

19.40.110 Procedures and Guidelines.

19.40.120 Remedies.

19.40.130 Waiver Prohibited.

19.40.140 Severability.

19.40.010 Binding Findings; De finitions; Citation.
(a) Binding Findings. Pursuant to Civil Code Section 1946.2(g)(1)(8B), the City Council hereby makes the following binding findings within this Chapter, that this Chapter is more protective than the provisions of Civil Code Section 1946.2 because:
(1) The just cause for termination of a residential Tenancy under this Chapter is consistent with orand more protective than Civil Code Section 1946.2; and (2) This Chapter provide
s additional tenant protections that are not prohibited by any other provision of law, because it provides for earlier and higher relocation assistance amounts than those available to Tenants covered by Civil Code Section 1946.2, requires certain minimum lease terms, limits the exemptions listed in Civil Code Section 1946.2 and in particular applies just cause for termination of a Tenancy to Dwelling Units regardless of when a certificate of occupancy is issued for the Dwelling Unit and protects Tenants upon commencement of the Tenancy; and
(3) As provided in Civil Code Section 1946.2(g)(2), a residential real property shall not be subject to both a local ordinance requiring just cause for termination of a residential Tenancy and Civil Code Section 1946.2. This Chapter intends to cover those Dwelling Units defined as Covered Rental Units and to the extent such Dwelling Units are covered by this Chapter, such Dwelling Units will not be subject to Civil Code Sections 1946.72 and 1947.12. (b) The City Council finds that there presently exists a critical shortage of rental housing in the City. Du
e to this shortage, it is very difficult to find adequate, safe, and habitable rental housing at reasonable rents.
(1) Due to the shortage of rental units, rents in the City are increasing excessively. A substantial number of persons in the City who reside in rental units spend a high percentage of their income on rent, and many have been forced to move out because they could no longer afford to pay the increase in rent. Further, low- and moderate-income Tenants have difficulty finding affordable housing after being displaced due to a rent increase.

Attachment 2

2 (2) The purposes of this Chapter are to promote long-term stability and certainty for Tenants in the rental market while providing Landlords an ability to receive a fair return on their Property. T
his Chapter regulates Rents and terminations of Tenancy, including requiring relocation assistance and affording a Tenant the right to return under certain circumstances. It requires Landlords to register Covered Rental Units, establishes an administrative hearing process, and provides for procedures and guidelines for the implementation of this Chapter. (c) Definitions. The following terms shall have the meaning provided below when used in this Chapter, whether plural or singular.
(1) "Accessory Dwelling UnitsUnit" shall mean an accessory dwelling unit or a junior accessory dwelling unit as those terms are defined in Code Section 18.200.180., which has received a valid accessory dwelling unit or a junior accessory dwelling unit permit from the City or Contra Costa County.
(2) “Accommodations” shall be as defined in the Government Code Section 7060(b)(1), which, for convenience, reads as follows:
(1) “Accommod
ations” means either of the following:
(A) The residential rental units in any detached physical structure containing four or more residential rental units.
(B) With respect to a detached physical structure containing three or fewer residential rental units, the residential rental units in that structure and in any other structure located on the same parcel of land, including any detached physical structure specified in subparagraph (A). (2)(3) “Allowable Annual Rent Increase” shall mean the annual rent increase as set forth in Section 19.40.040.
(3)(4) “Base Rent” shall mean for Tenanciesas follows: For tenancies commenced on or before January 12, 2023, the Rent in effect on January 12, 2023, and for Tenancies plus the Initial Allowable Annual Rent Increase. For tenancies commenced after January 12, 2023, the initialbut prior to the effective date of this Chapter, the Rent charged upon initial occupancy, provided plus the Initial Allowable Annual Rent Increase. For tenancies commenced after the effective date of this Chapter, the Rent charged upon initial occupancy. The foregoing amounts are subject to the assumption that amount issuch amounts are not in violation of this Chapter or any provision of State law. Nothing in this definition is intended to alter the requirement that a Landlord provide a Tenant with valid, written notice of any change in the terms of the Rental Agreement (including any Rent decrease or Rent increase) as required by Civil Code Section 827. (4)(5) “Base Year” shall mean the 2022 calendar year.
(5)(6) "City Council" shall mean the City C
ouncil of the City of Concord.
(6)(7) "City" sh
all mean the City of Concord.
(7)(8) "Code" shall mean the Concord Municipal Code.
(8)(9) "Covered Rental Unit" shall mean a Dwelling Unit lo cated within the City not
specifically exempted under Section 19.40.020(a) or 19.40.020(b). (9)(10) "CPI" shall mean Consumer Price Index for all urban consumers for the San Francisco-Oakland-Hayward, California area, or any successor designation of that index that may Page 41 of 285

3 later be adopted by the U.S. Department of Labor. for April of each year. Calculation of the CPI percentage will be determined by the City and set forth in its procedures and guidelines.

(10)(11) “Disabled” shall mean any mental or physical disability as defined in Government Code Section 12955.3. A “Disabled Tenant” is a Tenant who is disabled.

(11)(12) "Dwelling Unit" shall mean a dwelling unit, as defined under California Civil Code Section 1940(c), including joint living and work quarters, that is used or occupied in consideration of payment of Rent, and applies to any dwelling space that is actually used for residential purposes, whether or not the residential use is legally permitted, including live-work spaces, mobilehomes rented to a Tenant, and any Accessory Dwelling Unit in the City.

(12)(13) "Ellis Act" shall mean California Government Code Sections 7060 – 7060.7.

(13)(14) “Fair Return Petition” shall mean a petition filed by a Landlord seeking a Fair Return Rent Increase pursuant to Section 19.40.050.

(14)(15) “Fair Return Rent Increase” shall mean the amount by which RentBase Rent plus any Allowable Annual Rent Increase may be increased in accordance with an approved Fair Return petition submitted pursuant to Section 19.40.050.

(15)(16) “Hearing Officer” shall mean an official appointed by the City Attorney to conduct an administrative hearing pursuant to this Chapter.

(16)(17) "Housing Services" include, but are not limited to, repairs, maintenance, painting, providing light, heat, hot and cold water, elevator service, window shades and screens, storage, kitchen, bath and laundry facilities and privileges, janitor services, access to exterior doors, entry systems and gates, utilities (unless separately metered and billed to the Tenant by the utility company since the inception of the Tenancy, as provided in the Rental Agreement), refuse removal, furnishings, telephone, parking, the right to have a specified number of occupants or tenants, the right to have pets, utility infrastructure, and any other benefit, privilege or facility connected with the use or occupancy of any Dwelling Unit.

(17)(18) “HUD FMR Rent” shall mean the fair market rent published by the U.S.

Department of Housing and Urban Development for the applicable year for Contra Costa County.

(19) “Initial Allowable Annual Rent Increase” shall mean sixty percent (60%) of the CPI increase for the twelve-month period from April 2022 to April 2023, which equals 2.52%.

(18)(20) "Landlord" or “Owner” shall mean any person, acting as principal or through an agent, having the right to offer a Dwelling Unit for rent, and includes a predecessor in interest to the Landlordsublessor, except that this term does not include the Owner or operator of a mobile home park or his or her agent, but does include the Owner of a mobile home if the mobile home is offered for rent.

(19)(21) "Landlord's Family Member" shall mean a Landlord's parent, child, spouse or registered domestic partner, grandparent, grandchild.

(20)(22) “Lawful Rent” shall mean the Base Rent for a Covered Rental Unit as such Base Rent may be increased by any Annual Allowable Rent Increase and any Fair Return Rent Increase permitted by this Chapter. Lawful Rent expressly excludes any Unlawful Rent.

4 (21)(23) “Lawful Rent Increase” shall mean the Annual Allowable Rent Increase together with any Fair Return Rent Increase permitted for the Covered Rental Unit as specified in this Chapter. Lawful Rent Increase expressly excludes any Unlawful Rent increase.

(22)(24) “Lower-Income Tenant” shall mean a person and family whose income does not exceed the qualifying limits for lower income families as established and amended from time to time pursuant to Section 8 of the United States Housing Act of 1937, or as otherwise defined in California Health and Safety Code Section 50079.5.

(25) “Moving Stipend” is defined in Section 19.40.080(a)(2)d.

(23)(26) “Property” shall mean the real property inon which the Dwelling Unit or Units are located. For purposes of the Ellis Act evictions only, “Property” shall mean the parcel on which the Accommodations are located.

(24)(27) “Protected Tenant” shall mean any Lower-Income Tenant, Disabled Tenant, Senior Tenant, Terminally Ill Tenant, and any Tenant whose household contains School- Aged Children.

(25)(28) "Rent" shall mean all periodic payments and all nonmonetary consideration including, but not limited to, the fair market value of goods, labor performed or services rendered to or for the benefit of the Landlord under a Rental Agreement concerning the use or occupancy of a Dwelling Unit and premises and attendant Housing Services, including all payment and consideration demanded or paid for parking, utility charges, pets, furniture, and other benefits, privilege or facility connected with the use or occupancy of the Dwelling Unit.

(26)(29) "Rental Agreement" shall mean an oral or written lease, sublease, or similar agreement between a Landlord and a Tenant for the lawful occupancy of a Dwelling Unit.

(27)(30) “School-Aged Child” or “School-Aged Children” shall mean any dependent child under the age of eighteen (18) living in the Tenant’s Covered Rental Unit and who attends a Mount Diablo Unified School District public school.

(28)(31) “School Year” shall mean the first day of instruction for the fall semester through the last day of instruction for the Spring semester, as posted on the Mount Diablo Unified School District website.

(29)(32) “Senior Tenant” shall mean a Tenant who is at least sixty-two (62) years of age or older as defined in Government Code Section 7060.4.

(30)(33) "State" shall mean the State of California.

(31)(34) “Substantial Remodel” or “Substantially Remodel” shall mean either of the following that cannot be reasonably accomplished in a safe manner that allows the Tenant to remain living in the Covered Rental Unit and that requires the Tenant to vacate the Covered Rental Unit for at least thirty (30) consecutive days: (i) the replacement or substantial modification of any structural, electrical, plumbing, or mechanical system that requires a permit from a governmental agency; or (ii) the abatement of hazardous materials, including lead-based paint, mold, or asbestos, in accordance with applicable federal, State, and local laws. Cosmetic improvements alone, including painting, decorating, and minor repairs, or other work that can be performed safely without having the Covered Rental Unit vacated, do not qualify as substantial remodel.

5 (32)(35) "Tenancy" s
hall mean the lawful occupation of a Dwelling Unit and
includes a lease or a sublease.
(33)(36) "Tenant" shall mean a tenant, subtenant, lessee, sublessee, or any other person entitled under the terms of a Rental Agreement to the use or occupancy of any Dwelling Unit.
(34)(37) “Terminally Ill Tenant” shall mean a Tenant who has a terminal disease as defined in California’s End of Life Option Act as any “incurable and irreversible disease that has been medically confirmed and will, within reasonable medical judgment, result in death within six months” pursuant to Health and Safety Code Section 443.1 and which is verified in writing by the Tenant’s medical care provider.
(35)(38) “Unlawful Rent” shall mean any Rent charged by a Landlord to andor paid by a Tenant for a Covered Rental Unit which exceeds the Tenant’s Base Rent together pluswith any Lawful Rent Increase.
(d) Citation. This chapterChapter may be referred to as the “Residential Tenant Protection Program” of the City of Concord. The words “this chapterChapter” and “this Ordinance” are used interchangeably herein.

19.40.020 General Applicability of Chapter; Exemptions.

This Chapter shall apply to all Landlords and Tenants in Dwelling Units within the jurisdictional limits of the City, unless otherwise exempted by State law or the provisions of this Chapter. (a) Fully Exempt (Exempt from Both Rent Stabilization and Just Cause for Eviction). The following Dwelling Units are exempt from all provisions of this Chapter:
(1) Units in Hotels as defined in Code Section 3.15.220 which are rented primarily to Transients as defined in Code Section 3.15.220.18.20.010 which, for convenience, reads as follows:
“Hotel” or
“motel” means a facility that provides guest rooms or suites, with or without kitchen facilities, rented to the public for transient lodging. These facilities typically include a variety of services in addition to lodging, such as restaurants, meeting facilities, spas or other personal services, and accessory guest facilities including swimming pools, sport courts, exercise facilities, and accessory retail sales.

This classification does not include rooming houses, boardinghouses, or private residential clubs (see “Group housing” under “Residential Facility,” and “Bed and breakfast inn”)
For purposes of this Chapter only, “Hotel” or “motel” does not include short-term rentals arrangements in which a Dwelling Unit is hired or occupied by reason of concession, permit, right of access, license, or other agreement for a period of 30 consecutive calendar days or less, counting portions of calendar days as full days. (2) Institutional Facilities. Housing accommodations in a hospital, relig ious facility,
extended care facility, licensed residential care facility for the elderly, as defined in Section 1569.2 of the Health and Safety Code, or an adult residential facility, as defined in Chapter 6 of Division 6 of Title 22 of the Manual of Policies and Procedures published by the State Department of Social Services.

6 (3) Dormitorie
s owned and operated by an institution of higher education or a kindergarten and grades 1 to 12 inclusive, school.
(4) Government Owned. Housing accommodations which are owned by a public agency or authority, or which are specifically exempted under State or federal law or administrative regulation.
(5) Dwelling Units in which the Tenant shares bathroom or kitchen facilities with the Owner who maintains their principal residence at the Property. (6) Emergency shelters, and homeless shelters as defined in Code Section 18.200.070. (7) Residential facility/ies, as defined in Code Section 18.20.020. (8) Other than Dwelling Units that are restricted via a regulatory agreement from the California Tax Credit Allocation Committee (i.e. low income housing tax credit financed Dwelling Units), Dwelling Units restricted by deed, regulatory restriction contained in an agreement with a government agency, or other recorded document as affordable housing for persons and families of very low, low, or moderate income, as defined in Section 50093 of the Health and Safety Code.
(9)(8) Accessory Dwelling Units.
(9) A property containing two separate dwelling units within a single structure in which the owner occupied one of the units as the owner’s principal place of residence at the beginning of the tenancy, so long as the owner continues in occupancy, and neither unit is an accessory dwelling unit or a junior accessory dwelling unit. (b) Partially Exempt (Exempt fro
m Rent Stabilization but subject to Just Cause for Eviction).

The following Dwelling Units are exempt from all Rent Stabilization provisions of this Chapter:
(1) Dwelling Units that are expressly exempt under State or federal law. This includes any Dwelling Unit that has a certificate of occupancy or equivalent permit for residential occupancy issued after February 1, 1995. For this purpose, a certificate of occupancy is the certificate issued before the Property is used for any residential purposes. (2) Any Dwelling Unit that is alienable separate (i.e., separately transferrable) from the title to any other Dwelling Unit, or is a subdivided interest in a subdivision, as specified in California Business and Professions Code Section 11004.5 (b), (d), or (f), including without limitation single family residences and condominiums, but excluding mobile homes offered for rent.
(3) Dwelling Units that are either restricted by the City or other governmental agency as affordable housing for persons or families of very low, low, or moderate income, as defined in Section 50093 of the Health and Safety Code to the extent that such Dwelling Units are subject to rent increase restrictions equal to or less than five percent (5%) annually and enforceable by the City or other governmental agency pursuant to a deed, regulatory restriction contained in an agreement, or other recorded document.

7 19.40.030 Rent Stabilization.
(a) Subject to Section 19.2040.020, and effective as of January 12, 2023, no Landlord shall charge Rent in an amount that exceeds the Base Rent plus any Lawful Rent Increases implementedpermitted by this Chapter.

(b) If a Landlord imposed a Rent increase on a Tenancy after January 12, 2023, the Landlord shall owe the Tenant a refund of such Rent increase paid by the Tenant, which refund shall be paid as follows:

(3) If the Landlord imposed a Rent increase on a Tenancy on or after September 1, 2023, the Landlord shall, no later than thirty (30) days after the effective date of this Ordinance, provide the Tenants entitled to a refund, written notice of the amount of the refund together with a full refund payment by cash or check.

(4) If the Landlord imposed a Rent increase on a Tenancy on or after January 12, 2023, but before September 1, 2023, the refund may, at Landlord’s election, be in the form of a rent credit or a cash payment. The Landlord shall, no later than thirty (30) days after the effective date of this Ordinance, provide the Tenants entitled to a refund written notice of the amount of the refund and the time period and method by which the refund shall be paid; provided, however, that in no event shall the time period over which the refund is paid exceed the total number of months during which the Rent increase was effective.

19.40.040 Permitted Rent Increases for Covered Rental Units. (a) A Landlord may, but shall not be obligated to, impose the Initial Allowable Annual Rent Increase or any other an annual Rent increase for any Covered Rental Unit, as allowed in this Section 19.40.040 after providing prior written notice to the Tenant of the Rent increase pursuant to California Civil Code Section 827, as may be amended.

(b) Notwithstanding the foregoing, a Landlord shall be prohibited from imposing an Allowable Annual Rent Increase, unless the Covered Rental Unit is registered with the City pursuant to Section 19.40.060, and the Landlord is not delinquent in registry fees, accrued interest, fines, and penalties pursuant to former Section 19.40.110 (Rent Registry) and/or Section

19.40.060, as applicable, and has provided to the Tenant any refund owed pursuant to Section

19.40.030, if applicable..

(c) Allowable Annual Rent Increases. This Chapter shall limit annual Rent increases on Covered Rental Units to no more than sixty percent (60%) of the percentage increase in CPI published and reported in for the twelve-month period ending as of April of the currentimmediately-preceding year, provided however in no event shall the Allowable Annual Rent Increase exceed three percent (3%). In the event that the percentage change in the CPI is negative, the Allowable Annual Rent Increase shall be zero percent (0%) The Allowable Annual Rent Increase shall be rounded to the nearest one-quarter of a percent (0.25%). Nothing in this subsection is intended to alter the requirement that a Landlord provide a Tenant with valid, written notice of any Rent increase as required by Civil Code Section 827.

(d) Only one Allowable Annual Rent Increase and one Fair Return Rent Increase (if and to the extent approved by the Hearing Officer) may be imposed on a Tenant householdCovered Dwelling Unit in any twelve (12) month period, unless otherwise permitted by this Chapter.

(e) Rent Increase Following Vacancy (Vacancy Decontrol). When a Tenant has voluntarily moves out ofvacated, abandoned, or been legally evicted from a Covered Rental Unit, the Page 46 of 285

8 Landlord may set the initial Rent for the next Tenant, without restriction, at the commencement of the new Tenancy.

(f) Rent Banking Prohibited. Allowable Annual Rent Increase Banking Prohibited. A Landlord who seeks to raise Lawful Rent by the Allowable Annual Rent Increase must do so within the twelve-month period between August 1 of the current year and July 31 of the following year. A Landlord who does not impose an Allowable Annual Rent Increase or any portion thereof in the applicable twelve month period automatically waives that Allowable Annual Rent Increase or the remaining portion of that Allowable Annual Rent Increase for the remainder of the Tenancy.

19.40.050 Rent Adjustment Petitions.
(a) Fair Return Petitions. Landlords who believe they are not receiving a fair return on their Property may submit a Fair Return Petition to the City to request an increase in Rent beyond that which is permitted under Section 19.40.040.

(1) Nothing in this Section 19.40.050 shall be interpreted to authorize any Lawful Rent Increase in any twelve month period for a Covered Rental Unit in excess of the amount authorized pursuant to California Civil Code Section 1947.12, as may be amended. If a Hearing Officer awards a Landlord a Fair Return Rent Increase in excess of the maximum allowable Rent increase pursuant to thisCivil Code Section 19.40.0501947.12, the Landlord may carry forward any portion of the Fair Return Rent Increase that could not be taken to a subsequent year until the full Fair Return Rent Increase is imposed.

(2) No Fair Return Petition shall be deemed submitted or accepted until all of the following have occurred:

a.(2) Thethe Landlord has registered the Property and paid all current and past-due registration fees for the Property pursuant to former Section 19.40.110 (Rent Registry) and/or current Section 19.40.060, as applicable; and.

b. The Landlord has paid refunds owed to Tenants, if any, pursuant to Section 19.40.030.

(3) No Fair Return Rent Increases shall become effective until all of the following have occurred:

a. The Landlord has provided written notice of the Fair Return Rent Increase for the Covered Rental Unit in accordance with California Civil Code Section 827, as may be amended;

b. After a hearing is held, the Hearing Officer, in a written decision, grants the Fair Return Rent Increase; and

c. All amounts due and payable to the City in connection with the Fair Return Petition and hearing have been paid in full.

(4) Standard for Approving a Fair Return Petition.

a. Fair Return. The Landlord has the right to obtain a net operating income equal to the Base Year net operating income adjusted by the percentage increase in the CPI since the Base Year. It shall be presumed that this standard provides a

9 fair return. The current year CPI shall be the annual CPI for the calendar year preceding the calendar year the Fair Return Petition is filed. The Hearing Officer shall make a determination whether the Landlord will receive a fair return under this standard. In evaluating whether or not the Landlord is receiving a fair return on their investment, the Hearing Officer may consider other relevant factors without limitation.

b. Base Year Net Operating Income Adjustment.. The Base Year and current year net operating income shall be determined by subtracting the actual operating expenses for the Base Year from the gross income realized during the Base Year.

The Landlord shall provide evidence of gross income, operating expenses, and the determination of net operating income for the Base Year and current year. All figures shall be certified by the Landlord under penalty of perjury as true and correct and with respect to expenses and income used to determine gross income, as permitted pursuant to Section 19.40.050(a).

b.c. Rebuttal Of Base Year Net Operating Income Presumption. Any party to the hearing may present evidence to rebut the presumption of a fair return based onupon the Base Year net operating income based on either, and the Hearing Officer may adjust said net operating income accordingly if at least one of the following findings is made:

(i) exceptionalThe Landlord’s operating expenses in the Base Year, including but not limited to extraordinary were unusually high or low in comparison to other years. In such instances, adjustment may be made in calculating operating expenses so the Base Year operating expenses reflect average expenses for the Property over a reasonable period of time. The Hearing Officer shall consider the following factors in making this finding:
(a) Extraordinary amounts were expended for necessary
maintenance and repairs, or;

(b) Maintenance and repair was below accepted standards so as to cause significant deterioration in the quality of services provided;

(c) Other expenses were unreasonably high or low expenses;in comparison to prudent business practices;

(i)(d) Costs of debt service paid during the Base Year, where the proceeds of the debt were used for capital improvements or rehabilitation in the Property.
(ii) exceptional circumstances in the Base Year, including but not limited to gross income that is The gross income during the Base Year was disproportionate. In such instances, adjustments may be made in calculating gross income consistent with the purposes of this section. The Hearing Officer shall consider the following factors in making this finding:
(ii)(a) The gross income during the Base Year was lower than it might have been. because some Tenants were charged reduced Rent;

10 (b) The gross income during the Base Year was significantly lower than normal because of the destruction of the premises and/or temporary eviction or vacancies for a Substantial Remodel, construction, or repairs.
(iii) The Rent charged by the Landlord in the Base Year were significantly below the HUD FMR Rent for the most similar unit type.

d. Determination Of Current Net Operating Income. The net operating income as of the date of filing a Fair Return Petition shall be determined by:

(i) Annualizing the Rent in effect as of the date of filing to determine the annualized gross income;
(ii) Determining the operating expenses during the immediately preceding calendar year;
(iii) Subtracting the operating expenses determined pursuant to Subsection (ii) from the annualized gross income.
e. Calculation Of Gross Income.

(i) For the purposes of determining the net operating income, gross income shall be the sum of the following:

(a) Gross Rent calculated as gross rental income at one hundred percent (100%) occupancy, adjusted for uncollected Rent as provided in Section 19.40.050(a)(4)e.(ii);

(b) Income from any laundry facilities and parking fees;

(c) All other income or consideration received or receivable in connection with the use or occupancy of the Covered Rental Unit. (ii) Gross Rent shall be adjusted for uncollected Rent due to vacancy and bad debts to the extent such are beyond the control of the Landlord.

No such adjustment shall be greater than three percent (3%) of gross Rent unless justification for a higher rate is demonstrated by the Landlord. f. Calculation Of Operating Expenses.

(i) For the purposes of determining net operating income, operating expenses shall include the following:
(a) Reasonable costs of operation and maintenance.

(b) Utility costs to the extent they are not paid by the Tenants.

(c) Landlord-performed labor compensated at reasonable
hourly rates. No Landlord-performed labor shall be included as an Page 49 of 285

11 operating expense unless the Landlord submits documentation showing the date, time and nature of the work performed. There shall be a maximum allowed under this provision of five percent (5%) of gross income unless the Landlord shows greater services were performed for the benefit of the Tenants.

(d) Real property taxes and assessments.
(ii) Operating expenses shall not include the following:
(a) Mortgage principal or interest payments or other debt service costs or lease payments;

(b) Any penalties, fees or interest assessed or awarded for violation of any provision of this Chapter or of any other provision of law;

(c) Legal fees except as specified in Section

19.40.050(a)(4)f.(iii);

(d) Political contributions;

(e) Any expenses for which the Landlord has been or will be reimbursed by any discount, security deposit, insurance payment or settlement, judgment for damages, settlement or any other method or device;

(f) Avoidable and unnecessary expense increases since the Base Year;

(g) Depreciation;

(h) Expenses which are excessive in relation to the customary and reasonable costs of such items;

(i) The costs of capital improvements associated with the purchase and/or installation of separate meters or service unless the Landlord can demonstrate that such improvements benefit the Tenants;
(iii) Legal expenses allowed in the calculation of operating expenses shall include: attorneys’ fees and costs incurred in connection with successful good-faith attempts to recover Rent owing, successful good- faith unlawful detainer actions not in derogation of applicable law, and legal expenses necessarily incurred in dealings with respect to the normal operation of the Property to the extent such expenses are not recovered from adverse or other parties. Attorneys’ fees incurred in relation to the administrative or judicial proceedings in connection with Section

19.40.050(a) are not allowable as operating expenses.
g. Determination of Fair Return Rent Increase.

(i) The Hearing Officer shall set the Fair Return Rent Increase in the amount required to provide the Landlord with a fair return. Page 50 of 285

12 (ii) In determining the Fair Return Rent Increase required to provide the Landlord with a fair return, the following shall be determined:
(a) The fair return in accordance with Section

19.40.050.a.(4)(a);

(b) The gross income required to produce the fair return;

(c) The rent increase needed to produce the required gross income.
(5) Notices Upon Submitting Petition.

c.a. Within five (5) calendar days after submission of a Landlord's Fair Return Petition to the City, the Landlord shall serve each affected Tenant with a notice of the Fair Return Petition via personal service or certified mail, return receipt requested.

d.b. Within ten (10) calendar days after service on each affected Tenant, the Landlord shall file with the City a proof of service, signed under penalty of perjury, stating that a copy of the petition was served upon each affected Tenant.

(6) No Pass Through. Fees and costs incurred by a Landlord for making a Fair Return Petition may not be passed on to a Tenant but may be included as operating expenses for the calendar year in which they were incurred for purposes of determining net operating income.

Such fees and costs include, but are not limited to, attorney fees, accountant fees, and other similar professional services costs.

(b) Tenant Petitions. If a Landlord demands or retains Unlawful Rent for a Covered Rental Unit, a Tenant may file a petition to adjust the Rent to its lawful level.

(1) Unlawful Rent. If a Tenant believes that the Landlord is demanding Unlawful Rent for a Covered Rental Unit, then the Tenant may submit a Tenant petition to the City.

(2) Decrease in Housing Services. A decrease in Housing Services of a Covered Rental Unit, without a corresponding reduction in Rent, is considered an increase in Rent.

Before filing a petition with the City, a Tenant shall provide the Landlord all of the following (copies of which must be submitted with the Tenant petition):

a. Prior written notice identifying the decrease in Housing Services of a Covered Rental Unit; and

b. A reasonable opportunity to correct the issue(s).

(3) Notices Upon Submitting Petition.

a. Within five (5) calendar days after submission of a Tenant petition for rent adjustment to the City, the Tenant shall serve the Landlord with said petition via personal service or certified mail, return receipt requested.

b. Within ten (10) calendar days after service on the Landlord, the Tenant shall file with the City a proof of service, signed under penalty of perjury, stating that a copy of the petition was served on the Landlord.

13 (c) Petition Forms. Fair Return and Tenant petitions must be filed on petition forms prescribed by the City and accompanied by such supporting material as the City may require.

Each petition shall be made under penalty of perjury.

(d) Petition Fees.

(1) Fair Return Petitions.

a. Landlords filing a Fair Return Petition shall be responsible for all City costs associated with such petition, including, but not limited to the cost of the Hearing Officers, any costs associated with experts, inspection fees, and any other costs. The City shall provide the Landlord with an estimate of the costs at least 45 calendar days prior to the first date set for the hearing. The Landlord shall deposit with the City the full estimated cost of the hearing at least 30 calendar days prior to the first date set for the hearing. If the deposit is not timely received by the City, the hearing will be postponed, and the hearing shall not be rescheduled until such time as the deposit is received. City shall have the right to deduct costs incurred from the deposit. Upon the completion of the hearing, the City shall prepare a final invoice of hearing costs.
b. To the extent that the final invoice amount exceeds the amount deposited by the Landlord, the Landlord shall pay the difference to the City within 10 days of receipt of the final invoice. To the extent the final invoice amount is less than the amount deposited by the Landlord, the City shall issue a refund to the Landlord for the difference.

c. The City will not issue the Hearing Officer’s final decision until the City has received full payment of the final invoice, and no Fair Return Rent Increase, if approved, may be imposed until full payment is received by the City.

(2) Tenant Petitions. There shall not be any fee charged for Tenants filing a petition for a downward adjustment of Rent.

(e) Hearing Process.

(1) Upon receipt of a Fair Return or Tenant petition and the proof(s) of service that the petition has been served as provided above, the City shall appoint a Hearing Officer to conduct a hearing on the petition and to render a final decision on the merits of the petition, subject to this Chapter and any procedures, regulations, and guidelines promulgated by the City Manager.

(2) Each party to a petition shall receive sufficient advance notice of the time, date, and place of any hearing regarding the petition.

(3) The Hearing Officer may require either party to a petition to provide any books, records, and papers deemed pertinent.

(4) If the Hearing Officer finds good cause to believe that a building or other inspection would assist in resolving the issues raised in the petition, the Hearing Officer may conduct an inspection and/or request that the City conduct an inspection. Any party submitting a petition shall be required to cooperate with the City to grant and/or secure permission to conduct such inspection, within the constraints of applicable law; failure to do so shall be considered an automatic and voluntary withdrawal of that party’s petition upon written notice by the City thereof. The parties to the petition may be present during the inspection.

14 (5) All hearings conducted pursuant to this Chapter shall be open to the parties and their designated representatives, but shall not be open to the public.

(f) Assistance or Representation Authorized. All parties to a petition may seek assistance from attorneys, recognized tenant organization representatives, or any other person designated by said parties.

(g) Consolidation. All Fair Return Petitions pertaining to Tenants in the same Property shall be consolidated for determination. Tenant petitions for Rent adjustment from Tenants residing in the same Property may be consolidated at the election of the City, in its sole discretion.

(h) Quantum of Proof and Notice of Decision. No petition shall be granted unless supported by the preponderance of the evidence submitted prior to and at the hearing. All parties to the petition shall be sent notice of the decision.

(i) Finality of Decision. The decision of the Hearing Officer shall be the final decision and shall not be appealable to the City Council. Any party disputing the final conclusions and findings of the Hearing Officer may seek review pursuant to Code of Civil Procedure Sections 1094.5 and 1094.6.

(j) Time of Hearing and Decision. The City shall not be required to accept petitions until September 1, 2024. The City shall endeavor, but shall not be required, to schedule a hearing on a petition within ninety (90) days after submittal to the City of the petition and the proof(s) of service. A final decision on a petition shall be made within a reasonable time after the conclusion of the hearing.

19.40.060 Annual Rental Registration.
(a) Registration of Covered Rental Unit. On or before July 1 of each year, a Landlord shall register any Covered Rental Unit through the City’s designated rent registry portal, shall provide all required information, shall pay the required rent registry fees, and shall annually submit reports. To the extent that a Landlord has previously complied with the requirements of former Section 19.40.110 (Rent Registry), the Landlord shall on or before July 1, 2024, update the registration previously completed pursuant to former Section 19.40.110 to comply with the requirements of this Chapter.

(b) Rent Registry Fees. A Landlord shall pay the required rent registry fees as set forth in the City Council adopted Resolution Establishing Fees and Charges for Various Municipal Services.

The fees will be used to finance the cost of the rent registry and implementation and enforcement of this Chapter including, but not limited to, administrative time and costs, legal fees and costs, and any other expense incurred to implement, administer, or enforce this Chapter.

(c) Late Fees, Penalty For Late Payment; Penalty For Incomplete Or False Information.

Should a Landlord fail to pay all or a portion of the rent registry fees, or provide incomplete or false information, the City may recover the outstanding amounts, plus accrued interest, fines, and penalties, utilizing any remedies provided by law or in equ ity, including municipal tax lien
procedures established by ordinance or State law. Such sums shall be calculated as set forth in the Resolution Establishing Fees and Charges for Various Municipal Services and applicable law, may be applied on a per-unit basis, and may be subject to adjustment by the City Attorney or Hearing Officer.

15 (d) Past Due Amounts. To the extent that a Landlord owes rental registry fees, accrued interest, fines, or penalties incurred prior to the effective date of this Ordinance, such amounts shall continue to be owed and continue to accrue. See also Sections 19.40.040(b) and

19.40.050(a)(2).

19.40.070 Just Cause for Eviction.
(a) This Section 19.40.070 shall apply to all Landlords and Tenants in Dwelling Units within the jurisdictional limits of the City, unless otherwise exempted by State law or the provisions of this Chapter. This Section 19.40.070 shall apply to all Landlords and Tenants in Dwelling Units within the jurisdictional limits of the City, unless otherwise exempted by State law or the provisions of this Chapter.

(b) When terminating a Tenancy For Cause or No-Fault, a Landlord must comply with all of the following:

(1) The Landlord must serve a written notice, to the Tenant that, in addition to any information required by federal or State law, the Landlord will terminate the Tenant's Tenancy because of at least one For Cause or No-Fault reason; and state the ground(s) for such termination as described in Section 19.40.070(c) and/or (d);

(2) The Landlord has not accepted and will not accept Rent or any other consideration in return for the continued use of the Covered Rental Unit beyond the term of the terminated Tenancy in compliance with California Civil Code Sections 1945, 1946, and 1946.1, as may be amended; and

(3) The Landlord qualifies the termination as For Cause or No-Fault, as specified in this Section 19.40.070.

(c) For Cause Termination of Tenancy. If a Landlord can show any of the following circumstances with respect to a termination of Tenancy in a Covered Rental Unit, the termination qualifies as a For Cause Termination:

(1) Default in the payment of Rent.

(2) A breach in the material term of the Rental Agreement, as described in paragraph (23) of Section 1161 of the Code of Civil Procedure, including, but not limited to, violation of a provision of the Rental Agreement after being issued a written notice to correct the violation.

(3) Maintaining, committing, or permitting the maintenance or commission of a nuisance as described in paragraph (4) of Section 1161 of the Code of Civil Procedure.

(4) Committing waste as described in paragraph (4) of Section 1161 of the Code of Civil Procedure.

(5) The Tenant had a written Rental Agreement, and after a written request or demand from the Landlord, the Tenant has refused to execute a written extension or renewal of the Rental Agreement for an additional term of similar duration with similar provisions, provided that those terms do not violate this Chapter or any other provision of law.

(6) Criminal activity by the Tenant in the Covered Rental Unit or on the Property, including any common areas, or any criminal activity or criminal threat, as defined in subdivision

16 (a) of Section 422 of the Penal Code, or criminal activity by the Tenant on or off the Property that is directed at other Tenants or the Landlord.

(7) Assigning or subletting the Covered Rental Unit in violation of the Rental Agreement, as described in paragraph (4) of Section 1161 of the Code of Civil Procedure.

(8) The Tenant’s refusal to allow the Landlord to enter the Covered Rental Unit as authorized by Sections 1101.5 and 1954 of the Civil Code, and Sections 13113.7 and 17926.1 of the Health and Safety Code.

(9) Using the Covered Rental Unit or any portion of the Property for an unlawful purpose as described in paragraph (4) of Section 1161 of the Code of Civil Procedure.

(10) The employee, agent, or licensee’s failure to vacate after their termination as an employee, agent, or a licensee as described in paragraph (1) of Section 1161 of the Code of Civil Procedure.

(11) When the Tenant fails to deliver possession of the Covered Rental Unit after providing the Landlord written notice as provided in Section 1946 of the Civil Code of the Tenant’s intention to terminate the hiring of the Covered Rental Unit, or makes a written offer to surrender the Covered Rental Unit that is accepted in writing by the Landlord, but fails to deliver possession at the time specified in that written notice as described in paragraph (5) of Section 1161 of the Code of Civil Procedure.

(d) No-Fault Termination of Tenancy. If a Landlord can show any of the following circumstances with respect to a termination of Tenancy in a Covered Rental Unit, the termination qualifies as a No-Fault termination. See Section 19.40.070(e) for Right of Return provisions.

See Section 19.40.080 for Rental Assistance and Moving Stipend provisions.

(1) Owner Move Ins. Intent to occupy the Covered Rental Unit by the Landlord or the Landlord’s Family Member.

a. A Landlord may not terminate a Tenancy based on intent to occupy the Covered Rental Unit by the Landlord or the Landlord’s Family Member if the intended occupant already occupies a Dwelling Unit on the Property or if a vacancy of a similar Dwelling Unit already exists at the Property.

b. The written notice terminating a Tenancy pursuant to this subparagraph shall contain the name or names and relationship to the Landlord of the intended occupant. The written notice shall additionally include notification that the Tenant may request proof that the intended occupant is a Landlord or the Landlord’s Family Member. The proof shall be provided upon request and may include an operating agreement and other non-public documents.

c. This subparagraph (1) only applies if the intended occupant moves into the Covered Rental Unit within ninety (90) days after the Tenant vacates and occupies the Covered Rental Unit as a primary residence for at least twelve (12)__________(__) consecutive months.

d. If the intended occupant fails to occupy the Covered Rental Unit within ninety (90) days after the Tenant vacates, or if the intended occupant fails to occupy the Covered Rental Unit as their primary residence for at least twelve (12) consecutive months, the Landlord shall offer the Covered Rental Unit to the Tenant who vacated it at the same Rent, subject to any Lawful Rent Increases, and Page 55 of 285

17 rental terms in effect at the time the Tenant vacated. If Tenant re-occupies such Covered Rental Unit, Landlord shall reimburse the Tenant for reasonable moving expenses incurred. Such payment shall be in addition to any relocation assistance that was paid to the Tenant in connection with the termination notice.

e. For a new Tenancy commenced during the time periods described in clause d, the Covered Rental Unit shall be offered and rented or leased at the Lawful Rent in effect at the time any notice of termination of Tenancy is served, subject to any Lawful Rent Increases.

f.d. A Landlord shall only be allowed to terminate a Tenancy pursuant to this subsection (Subsection 19.40.070(d)(1) if the Landlord meets one of the following:

(i) is a natural person that has at least 25__ percent recorded ownership interest in the Property;

(ii) is a natural person who has any recorded ownership interest in the Property if 100one hundred percent (100%) of the recorded ownership interest is divided among owners who are related to each other as sibling, spouse, domestic partner, child, parent, grandparent, or grandchild; or

(iii) is a natural person whose recorded interest in the Property is owned through a limited liability company or partnership.

e. Owner Move-In Protections for Senior, Disabled, and Terminally Ill Tenants. A Landlord may not evict a Tenant in order to occupy the Covered Rental Unit by the Landlord or the Landlord’s Family Member, if the Tenant has resided in the Dwelling Unit for at least three years and is either a Senior Tenant, a Disabled Tenant, or a Terminally Ill Tenant, unless the Landlord or Landlord’s Family Member who will occupy the Covered Rental Unit is either a Senior Tenant, a Disabled Tenant, or a Terminally Ill Tenant, and no other Covered Rental Units are available at the Property.

g.f. As used in this subsection:Subsection 19.40.070(d)(1):

(i) “Natural person” includes any of the following:
(A)(a) a natural person who is a settlor or beneficiary of a family trust; or

(B)(b) if the Property is owned by a limited liability company or partnership, a natural person with a 25-__-percent ownership interest in the Property.

(ii) “Family trust” shall mean a revocable living trust or irrevocable trust in which the settlors and beneficiaries of the trust are persons who are related to each other as sibling, spouse, domestic partner, child, parent, grandparent, or grandchild.

18 (2) Ellis Act Evictions. Withdrawal of all Accommodations at the Covered Rental UnitProperty from the rental market is subject to the following conditions and requirements pursuant to the Ellis Act:

a. Landlord complies with all provisions of the Ellis Act, unless otherwise indicated in this Section. 19.40.070(d)(2).

b. Not less than one hundred twenty (120) days from the date the Landlord intends to withdraw the Covered Rental Units in a Property or structure from the rental marketAccommodations, and after completion of all required proceedings, if any, the Landlord shall provide written notice of termination of Tenancy to all affected Tenants.

c. Landlord's notice to all affected Tenants shall contain the following information:

(i) That the Landlord is evicting the Tenant pursuant to this Subsection;Section 19.40.070(d)(2);

(ii) That within thirty (30) days of receipt of notice to terminate, the Tenant may notify the Landlord in writing that the Tenant would be interested in re-renting the Covered Rental Unit if any of the Covered Rental Units are re-offered for rent at a future time and advising the Tenant to notify the Landlord of future address changes;

(iii) A description of the Tenant's rights;

(iv) The notice shall be accompanied by relocation assistance and any additional special assistance in accordance with Section 19.40.080;

(v)(iii) AA general description of the Tenant's rights to relocation assistance and any other rights set forth in this Chapter; and and the Ellis Act (relocation assistance and any additional special assistance shall be paid in accordance with Section 19.40.080);

(iv) Any other information required pursuant to Civil Code Sections 7060.4 and

(vi)(v) A self-addressed stamped postcard on which the Tenant may indicate, under penalty of perjury, whether they or a member of their household are a Protectedanother Tenant and under which category (i.e., Lower-Income Tenant, in the Covered Dwelling Unit are a Disabled Tenant, or Senior Tenant, Terminally Ill Tenant, School-Aged Child/ren) they claim Protected Tenant status.

d. A Senior Tenant or a Disabled Tenant who has resided in the Covered Rental Unit for at least one (1) year prior to the Landlord's notice of intent to withdraw the Covered Rental Unit in a Property from the residential rental market, and after receiving one hundred twenty (120) days written notice, may within sixty (60) days of receipt of the written notice of termination submit a written notice to the Landlord of Tenant’s status as a Senior or Disabled Tenant, in which event the notice of termination shall be extended to one year from the Tenant's date of delivery of the notice. pursuant to 19.40.070(d)(2)(c).

19 e. To the fullest extent permitted by law, the City adopts all tenant protections authorized by the state legislature in the following provisions of the Ellis Act: California Government Code Sections 7060.2, 7060.3, 7060.4, 7060.6, and this subdivision shall be interpreted to implement all available tenant protections in the aforementioned sections of the Government Code, as they exist as of the effective date of this Chapter. See also Section 19.40.070(e)(2) for Ellis Act right of return provisions. See Section 19.40.120(a)(3) for Ellis Act remedies, including exemplary damages.

f. Recordation of Notice:

(i) The City shall prepare a form notice consistent with Government Code Section 7060.3, and which shall specifically describe the Property where the Covered Rental Units are located, the dates applicable to the constraints and the name of the owner of record of the Property.

(ii) Any Landlord withdrawing a Property containing Covered Rental Units from the rental market shall complete such notice and shall serve such notice on the City concurrent with providing notice to the Tenants of the Landlord's intent to withdraw the Covered Rental Units from the residential rental market. The notice shall be executed by the fee owner(s) of the Property, and all such signatures shall be duly notarized.

(iii) City shall record the notice with the County Recorder. Such notice encumbers the Property for ten (10) years from the date the Accommodations are withdrawn from rent or lease.

(3) Government Orders. The Landlord is complying with any of the following:

a. An order issued by a government agency or court relating to habitability that necessitates vacating the Covered Rental Unit; or

b. An order issued by a government agency or court to vacate the Covered Rental Unit; or

c. A local ordinance that necessitates vacating the Covered Rental Unit.

(4) Intent to Demolish/Substantially Remodel. Intent to demolish or to Substantially Remodel the Covered Rental Unit.

a. For purposes of this subparagraph, a Tenant is not required to vacate the Covered Rental Unit on any days where a Tenant could continue living in the Covered Rental Unit without violating health, safety, and habitability codes and laws.

b. In order to terminate a Tenancy based on intent to demolish or to Substantially Remodel the Covered Rental Unit pursuant to this subparagraph, a Landlord must provide the Tenant with written notice pursuant to Civil Code Section 1946.1 which notice shall be in no less than 12-point type, shall be in English and Spanish and include all of the following information:

(i) A statement informing the Tenant of the Landlord’s intent to demolish the Property or Substantially Remodel the Covered Rental Unit or Property.

20 (ii) The following statement: “If the substantial remodel of your unit or demolition of the property as described in this notice of termination is not commenced or completed, the Landlord must offer you the opportunity to re-rent your unit with a rental agreement containing the same terms as your most recent rental agreement with the Landlord at the rental rate that was in effect at the time you vacated. You must notify the Landlord within thirty (30) days of receipt of the offer to re-rent of your acceptance or rejection of the offer, and, if accepted, you must reoccupy the unit within thirty (30) days of notifying the Landlord of your acceptance of the offer.”

(iii) A description of the Substantial Remodel to be completed, the approximate expected duration of the Substantial Remodel, or if the Property is to be demolished, the expected date by which the Property will be demolished, together with one of the following:

A. (a) A copy of the permit or permits (or a written
commitment from the applicable governmental agency that such permits are ready to be issued subject only to conditions requiring the Property or Covered Rental Unit to be vacant) required to undertake the Substantial Remodel or demolition; or

B. (b) If the notice is issued to abate hazardous materials and the remodel does not require any permit, a copy of the signed contract with the contractor hired by the Landlord to complete the Substantial Remodel, that reasonably details the work that will be undertaken to abate the hazardous materials.

(iv) A notification that the Tenant has the right to elect one or both of the following:return to the Covered Rental Unit upon completion of the Substantial Remodel at the same Rent and the same lease terms subject to any Lawful Rent Increases.

(e) Tenant's Right of First Return to a Covered Rental Unit; Rent Upon Return.

Owner Move In Right of Return. If the intended occupant fails to occupy the Covered Rental Unit within ninety (90) days after the Tenant vacates, or if the intended occupant fails to occupy the Covered Rental Unit as their primary residence for at least __________(__) consecutive months. If Tenant re-occupies such Covered Rental Unit, Landlord shall reimburse the Tenant for reasonable moving expenses incurred. Such payment shall be in addition to any relocation assistance that was paid to the Tenant in connection with the termination notice.A. The right of first refusal to any vacant comparable or superior Dwelling Unit owned To the extent permitted by the Landlord at the same Rent, if such comparable or superior vacant Dwelling Unit exists; and/or

(1) B. The first right to return to occupyState law, for a new Tenancy commenced during the time periods described in this Section 19.40.070(e)(1), the Covered Rental Unit upon completion of the repairsshall be offered and rented or leased at the Lawful Rent in effect at the same Renttime any notice of termination of Tenancy is served, subject to any Lawful Rent Increases, charged to the Tenant before the Tenant temporarily vacated the Covered Rental Unit. Page 59 of 285

21 (2) In the event the Tenant elects to accept an offer to move to a comparable or superior vacant Dwelling Unit owned by the Landlord at the same Rent, the Tenant is not eligible for any relocation assistance Ellis Act Right of Return.

c. If within two (2) years after withdrawing a Covered Rental Unit from the rental market pursuant to Section 19.40.080 herein; however, the length of the Tenancy shall continue to be calculated from the date 070(d)(2) a Landlord offers for Rent such Covered Rental Unit, in addition to any right of return that the Tenant first entered into a Rental Agreement for may have pursuant to this Chapter, the Landlord shall be liable to the Tenant who was displaced from the Covered Rental Unit from whichactual and exemplary damages provided the Tenant was displaced.

d.a. The phrase comparable or superior when used in connection with a Dwelling Unit or temporary housing shall mean a Dwelling Unit or temporary housing that is similar in size or larger, has the same number of bedrooms or additional bedrooms, is located in the City, has similar amenities as the Covered Rental Unit, such as parking, laundry facilities or exercise facilities, allows pets if the displaced Tenant has a pet, and as to a Disabled Tenant, is disability accessible and ADA compliant. The Tenant, in the Tenant’s reasonable discretion may waive any of these factors in deciding whether the Dwelling Unit or temporary housing offered is comparable or superior.

(e) Tenant's Right of First Return to a Covered Rental Unit.

(5)a. Right of First Return. All Tenants whose Tenancy is terminated based upon a basis enumerated in Section 19.40.070(d)(1)-(4) shall have the first right to return to the Tenant’s original Covered Rental Unit if the Covered Rental Unit is returned to the market by the Landlord or the Landlord’s successor. Rent for suchbrings an action against the Landlord within three (3) years of the withdrawal of the Covered Rental Unit shall be the Rent lawfully paid by the Tenant at the time the Landlord gave notice of termination, subject to any Lawful Rent Increases, unless otherwise specified hereinfrom the rental market.

(6)a. Return Within Five (5) Years. A Tenant of a Covered Rental Unit whose Tenancy was terminated in accordance with Section 19.40.070(d)(2) is entitled to receive notice of the first right to return to rent the same Covered Rental Unit at the Rent previously charged for the Covered Rental Unit, subject to any Lawful Rent Increases, and subject to the Rental Agreement terms in effect at the time the Tenant vacated. A Tenant may return to the Covered Rental Unit if:

e.(i) The Tenant has provided the Landlord a current mailing address and/or email address and keeps those addresses updated, at which to receive notice from Landlord that Covered Rental Unit is available; and

f.(ii) The Landlord returns the Covered Rental Unit to the residential rental market within five (5) years after the effective date of withdrawal of a Property containing the Covered Rental Unit from the residential rental market.

(7)a. Return Within Ten (10) Years. A Landlord of a Property containing a Covered Rental Unit that was withdrawn from the residential rental market within the previous ten (10) years must provide one hundred twenty (120) days written Page 60 of 285

22 notice to the previous Tenants of the Landlord's intent to return the Covered Rental Unit to the residential rental market.

(8)a. Any Tenant displaced from a Covered Rental Unit in connection with the withdrawal of a Property containing a Covered Rental Unit from the residential rental market may request the first right of return from the Landlord within thirty (30) days of receipt of a Landlord's written notice of intent to return the Covered Rental Unit to the residential rental market.

(9) RecordationGovernment Order Right of Memorandum. Any Return. The Landlord withdrawing a Property containing must give advance notice to the Tenant of the Tenant’s right to reoccupy the Covered Rental Units from the rental market shall record a memorandum on a City approved form in the Official Records of Contra Costa County encumbering the property whereUnit if the Dwelling and when the Covered Rental Unit is locatedfound to be in compliance with the order. The Tenant shall notify the Landlord, in writing, within ten (10thirty (30) days after the receipt of providingsuch notice to the Tenants of the Landlord's intent to withdraw the Dwelling Units from the residential rental market. The memorandum must be executed by the fee owner(s) of Tenant’s interest to reoccupy the Property.

a.(1) The memorandum Covered Rental Unit and shall summarizeprovide the obligations of the fee owner and Landlord, and any successor in interest to the fee owner and Landlord related to the Property including the Tenant's right to be notified upon Covered Rental Units being returned to the residential rental marketLandlord with their contact information.

b. The summary memorandum must encumberSubstantial Remodel Right of Return. Tenant shall have the Property for ten (10) years from right to return to the date of Covered Rental Units are withdrawn.

c.(1) The Unit upon completion of the Substantial Remodel. The Tenant shall notify the Landlord shall deliver to the City a conformed copy of the recorded memorandum, in writing, within sixty (60thirty (30) days after filing itsthe receipt of such notice to withdrawof the Tenant’s interest to reoccupy the Covered Rental Unit and shall provide the Landlord with the Citytheir contact information.

(1) Rent Upon Return. In each such instance, the Landlord shall offer and Tenant shall have the right return to the same Covered Rental Unit at the Rent previously charged for the Covered Rental Unit, subject to any Lawful Rent Increases, and subject to the Rental Agreement terms in effect at the time the Tenant vacated.

(f) School Year Evictions.

a.(1) It shall be a defense to a no-fault eviction if a School-Aged Child resides in the Covered Rental Unit, if the effective date of the notice of termination of Tenancy falls during the School Year.

b.(2) Within thirty (30) days of service of the notice of termination of Tenancy, the Tenant must submit a statement with supporting evidence to the Landlord if the Tenant claims to have a School-Aged Child residing in the Covered Dwelling Unit; this information is required in addition to Tenant’s return of the postcard referenced in Section 19.40.070(e)(2)c.(vi080(a)(1).

The notice of termination of Tenancy shall contain a warning that a Tenant’s failure to submit such statement within thirty (30) days of receipt of the notice shall be deemed an admission that the Tenant is not protected from eviction pursuant to this Subsection Section 19.40.070(f).

23 c.(3) A Landlord may challenge a Tenant’s claim of protected status pursuant to this Subsection Section 19.40.070(f) through commencement of the eviction proceeding.

19.40.080 Relocation Assistance For No-F ault Termination Of Tenancy; Notice Of Curable Lease ViolationsMoving Stipend.
(a) Relocation Assistance for No-Fault Terminations.

(1) For a Tenancy for which just cause is required to terminate the Tenancy under Section 19.40.070, if a Landlord issues a termination notice for a no-fault reason the Landlord shall, regardless of the Tenant’s income, assist the Tenant to relocate by providing a direct payment to the Tenant as described in Subsection (a)(3), below, and (except to the extent prohibited by applicable law) the Landlord shall notify the Tenant in writing of the Tenant’s right to relocation assistance and the amount of the relocation assistance at the time the Landlord issues the notice of termination. Each termination notice shall be accompanied by a self- addressed stamped postcard (in a format approved by the City) on which the Tenant may indicate, under penalty of perjury, whether they or another Tenant in the Covered Dwelling Unit are a Protected Tenant and under which category (i.e., Lower-Income Tenant, Disabled Tenant, Senior Tenant, Terminally Ill Tenant, School-Aged Child/ren) they claim Protected Tenant status.

(2) Permanent Relocations. When relocation assistance is required by this Section

19.40.080(a)(2) to Tenants who are evicted pursuant to Section 19.40.070(d), the Landlord must make relocation assistance payments as follows:

a. Non-Protected Tenant Relocation PaymentAssistance. If the Tenancy is terminated pursuant to Section 19.40.070(d)(1)-(3) (i.e. Owner Move-Ins, Ellis Act Evictions, Governmental Orders), or pursuant to Section 19.040.070(d)(4) (i.e. Intent to Demolish/Substantially Remodel) with the intent to demolish the Covered Rental Unit, the Landlord shall pay to the Tenant relocation assistance in the amount of the greater of three times the HUD FMR Rent for the most similar unit type based on the number of bedrooms or $8,500plus the Moving Stipend.

Such payment shall be calculated on a per-Covered Dwelling Unit basis, without reference to the number of Tenants in the Covered Dwelling Unit.

b. Protected Tenant Relocation PaymentAssistance. If one of the Tenants living in the Covered Rental Unit from which the Tenants are displaced is a Protected Tenant, then all Tenants living in the Covered Rental Unit are collectively entitled to receive additionalsupplemental relocation assistance in the amount of one additional month of the applicable HUD FMR Rent. Such payment shall be calculated on a per-Covered Dwelling Unit basis, without reference to the number of Tenants and Protected Tenants in the Covered Dwelling Unit.

c. Payment Process. For permanent relocation assistance, the Landlord shall provide one-half of the relocation assistance owed to the Tenant within 15 calendar days of service of the notice of termination. The remaining relocation assistance shall be paid to the Tenant in cash no later than the date the Tenant vacates the Covered Rental Unit.

d. Moving Stipend. The Landlord shall pay to Tenant the amount of $3,000 (“Moving Stipend”), which shall be paid to the Tenant in cash no later than the Page 62 of 285

24 date the Tenant vacates the Covered Rental Unit. Such payment shall be calculated on a per-Covered Dwelling Unit basis, without reference to the number of Tenants in the Covered Dwelling Unit.

d.e. Refund of Security Deposit. A Landlord must refund to the Tenant any security deposit paid by the Tenant. A Landlord may withhold any properly itemized deductions from the security deposit in accordance with California Civil Code Section 1950.5.

(3) Temporary Relocations. A Landlord must pay temporary relocation assistance to Tenants of a Covered Rental Unit who are temporarily displaced due to Substantial Remodel of Covered Rental Unit:

a. Thirty (30) Days or Fewer. A Landlord must provide the Tenant a per diem payment if the Tenant will be temporarily displaced for thirty (30) days or fewer. The Landlord shall pay to the Tenant the full amount of the per diem payment when the Tenant temporarily vacates the Covered Rental Unit.

b. Thirty-One (31) Days or More. If Tenant does not make an election pursuant to 19.40.070(d)(4)c., aA Landlord must provide the Tenant either a per diem payment or, at the Landlord’s election, comparable or superior temporary housing, if available.

c. Duration Extended. In the event the duration of the temporary relocation is longer than anticipated, the Landlord shall continue to pay to the Tenant the per diem relocation assistance payments on a weekly basis or continue to provide the Tenant with the comparable or superior temporary housing until the Tenant is able to return to the Covered Rental Unit.

d. Per-Diem Amount. The per diem payment amount shall be based on the Federal General Services Administration per diem rate for lodging and meals (M&IE total) in Concord, Contra Costa County, which is updated on a yearly basis. Per diem payments for meal shall be on a per Tenant basis. Per diem payments for lodging shall be on a per-Covered Dwelling Unit basis assuming a household size of four.

e. Rent Due. For temporary relocation assistance where the Landlord is providing comparable or superior temporary housing or making a per diem payment, the Tenant shall continue to pay the Lawful Rent to the Landlord for the Covered Rental Unit.

f. Refund of Security Deposit. A Landlord shall not be required refund to the Tenant any security deposit paid by the Tenant in connection with a temporary relocation.

g. The phrase “comparable or superior”No Waiver. Subject to Tenant’s elections under 19.40.070(d)(4)c., when used in connection with a Dwelling Unit or temporary housing shall mean a Dwelling Unit or temporary housing that is similar in size or larger, has the same number of bedrooms or additional bedrooms, is located in the City, has similar amenities as the Covered Rental Unit, such as parking, laundry facilities or exercise facilities, allows pets if the displaced Tenant has a pet, and as to a Disabled Tenant, is disability accessible and ADA compliant. The Tenant, in the Tenant’s reasonable discretion may waive any of

25 these factors in deciding whether the Dwelling Unit or temporary housing offered is comparable or superior.

(b) No Waiver. In the event the Tenant accepts an offer to temporarily or permanently move to an available comparable or superior vacant Dwelling Unit owned by the Landlord at the same Rent, the Tenant shall not be entitled to relocation assistance pursuant to Section 19.40.080 herein, but shall be eligible for the Moving Stipend. Except as expressly provided in this Subsection 19.40.080(b), a Tenant cannot waive their right to receive relocation assistance required by this Chapter.

(c) Coordination With Other Relocation Benefits. If a Tenant receives, as part of the termination of Tenancy, relocation assistance from a governmental agency,pursuant to the California Relocation Assistance Act (Government Code Sections 7260-7277), then the amount of that relocation assistance shall operate as a credit against any relocation paymentassistance to be paid to the Tenant under this Section 19.40.070.

19.40.090 Requirement to Offer Written Lease; Minimum Lease Terms. Tenants shall have the right to written leases and minimum lease terms, as provided herein. (a) One-Year Lease Term. If a prospective Tenant wishes to rent a Dwelling Unit from a Landlord and if said Landlord wishes to rent said Dwelling Unit to said prospective Tenant, the Landlord must offer to the prospective Tenant a written lease which has a minimum term of one year. Such offer must be made in writing. If the prospective Tenant accepts the offer of a written lease which has a minimum term of one year, this acceptance must be in writing. Signing a lease which has a minimum term of one year will be considered an offer if signed by the Landlord, and an acceptance if countersigned by the prospective Tenant. If the prospective Tenant rejects the offer for a written lease which has a minimum term of one year, such rejection must be in writing.

(b) Six-Month Lease Term. If the prospective Tenant rejects the offer for a written lease which has a minimum term of one year as provided in Section 19.40.090(a), but the prospective Tenant continues to wish to rent said Dwelling Unit from said Landlord, said Landlord must offer to said prospective Tenant a written lease which has a minimum term of six months. Such offer must be made in writing. If said prospective Tenant accepts the offer of a written lease which has a minimum term of six months, this acceptance must be in writing. Signing a lease which has a minimum term of six months will be considered an offer if signed by said Landlord, and an acceptance if countersigned by said prospective Tenant. If said prospective Tenant rejects the offer for a written lease which has a minimum term of six months, such rejection must be in writing.

(c) Shorter Term. If said prospective Tenant rejects the offer for a written lease which has a minimum term of six months as provided in Section 19.40.090(b), said Landlord and said prospective Tenant may then enter into a written lease that provides for a term of fewer than six months.

(d) Renewal of Lease. If both the Landlord and Tenant wish to continue the Tenancy, upon the expiration of a Rental Agreement which has a minimum term of one year or six months, a written Rental Agreement shall be offered again in accordance with the procedures set forth in Sections 19.40.090(a)-(c). The Landlord shall have no obligation to re-offer a Tenant a one-year or six-month lease term if the Tenant has previously rejected such offers in accordance with the procedures set forth in Sections 19.40.090(a)-(c), and has a Rental Agreement with a term of fewer than six months.

26 (e) Existing Tenancies. Any Tenant renting a Dwelling Unit may request a written lease with a minimum term of either one year or six months, provided such Tenant has not previously received a written notice of Rental Agreement violation pursuant to Code of Civil Procedure Section 1161 and such violation remains uncured. The Tenant shall do so via written notice to the Landlord. The Landlord shall, upon receipt of such notice, offer to said Tenant a written Rental Agreement on terms substantially similar to those of the existing rental arrangement (except as to length of term) in accordance with the procedures set forth in this sectionSection

19.40.090, as applicable.

(f) Exemptions. This section shall not apply to Dwelling Units that are exempt from the just cause eviction protections set forth in Section 19.40.070.

19.40.100 Notice of Tenant Rights.
(a) A Landlord subject to this Chapter shall provide notice to the Tenant as follows:

(1) For any Tenancy commenced or renewed on or after the effective date of this Ordinance, as an addendum to the Rental Agreement, or as a written notice signed by the Tenant, with a copy provided to the Tenant.

(2) For any Tenancy existing prior to the effective date of this Ordinance, by written notice to the Tenant no later than 180 days after the effective date of the Ordinance adopting this Chapter, or as an addendum to the Rental Agreement.

(b) The notification and Rental Agreement provision shall be in no less than 12-point type, shall be in English and Spanish, and shall include the following:

Concord law limits the amount your rent can be increased. See Chapter 19.40 of the Concord Municipal Code for more information. Concord law also provides that, a Landlord must provide a statement of cause in any notice to terminate a Tenancy. See Section 19.40 070 of the Concord Municipal Code for more information. In addition, City of Concord Municipal Code SectionSections 19.40.070(e) and 19.40.080 providesprovide tenants evicted on a no-fault basis with the right to return to the Tenant’s original Covered Rental Unit if such Covered Rental Unit is returned to the market, and the right to relocation paymentsassistance and a moving stipend; see City of Concord Municipal Code SectionSections 19.40.070(e) and 19.40.080 for more information.

City of Concord Municipal Code Section 19.40.090 provides tenants with the right to written leases and minimum lease terms. Landlords must offer tenants the option to enter into a one (1) year written lease. If a tenant declines a one (1) year written lease, the landlord must offer that tenant the option to enter into a six (6) month written lease. It is the tenant’s choice whether or not to enter into such a written lease with a landlord. If tenant rejects the initial offers of a written lease with a minimum lease term of 12 or 6 months, the tenant and landlord may enter into a written lease with a term of fewer than 6 months. See City of Concord Municipal Code Section 19.40.090 for more information. (c) Manner. Landlords must provide the notice to Tenants in writing if the application and Rental Agreement are processed in writing, electronically if the application and/or Rental Agreement are processed electronically, or both if both methods are utilized. The provision of the notice shall be subject to Civil Code Section 1632.

27 19.40.110 Procedures and Guidelines.

The City Manager is hereby delegated the authority to promulgate procedures, regulations, and guidelines to aid in the implementation of this Chapter.

19.40.120 Remedies.
(a) Remedies and penalties.

(1) If a Landlord violates the terms of this Chapter, an aggrieved Tenant may institute a civil action for injunctive relief, actual, statutory, or direct money damages, and any other relief that the court deems appropriate, which shall include a civil penalty of no less than $2,000, and no more than $5,000, per violation, at the discretion of the court. If the aggrieved Tenant is a Senior Tenant or a Disabled Tenant, the court may award an additional civil penalty of up to $5,000 per violation, at the discretion of the court.

(2) Any person who violates, aids, abets, or incites another person to violate this Chapter is liable in a court action for each and every such offense for money damages of not less than three times actual damages suffered by an aggrieved Tenant (including damages for mental or emotional distress), or for minimum damages in the sum of $1,000, whichever is greater, and whatever other relief the court deems appropriate. In the case of an award of damages for mental or emotional distress, said award shall only be tripled if the trier of fact finds that the defendant Landlord acted in knowing violation of or in reckless disregard of this Chapter.

(3) If within two (2) years after withdrawing a Covered Rental Unit from the rental market pursuant to Section 19.40 070(d)(2) a Landlord offers for Rent such Covered Rental Unit, in addition to any right of return that the Tenant may have pursuant to this Chapter, the Landlord shall be liable to the Tenant who was displaced from the Covered Rental Unit actual and exemplary damages provided the Tenant brings an action against the Landlord within three (3) years of the withdrawal of the Covered Rental Unit from the rental market.

(b) The court may award punitive damages in a proper case as set out in Civil Code Section 3294 and pursuant to the standards set forth in that code section or any successor thereto, but may not award both punitive damages and triple damages.

(c) The court shall award reasonable attorneys’ fees and costs to a Tenant who prevails in any such action. The court shall award reasonable attorneys’ fees and costs to a Landlord who prevails in any such action if the court determines that the Tenant’s action was frivolous.

(d) The remedies available under this sectionSection 19.40.120 shall be in addition to any other existing remedies which may be available to the residential tenant under applicable federal, State, county, or local law.

(e) NoExcept in connection with a Fair Return Petition or a Tenant Petition, no administrative remedy need be exhausted prior to filing suit pursuant to this Chapter.

(f) Authorization of City Attorney to enforce the Ordinance. The City Attorney shall have the right and authority, but not the obligation, to enforce this Chapter, including bringing actions for injunctive relief, equitable relief, restitution, and/or penalties to ensure compliance with this Chapter.

(g) To the extent permitted by law, any viola tion of this Chapter shall be a defense to an unlawful detainer action. Page 66 of 285

28 19.40.130 Waiver Prohibited .

Any waiver of rights under this Chapter shall be void as contrary to public policy.

19.40.140 Severability.

If any section, subsection, sentence, clause or phrase of this Chapter is for any reason held by a court of competent jurisdiction to be invalid, such decision shall not affect the validity of the remaining portions of this Chapter. The City Council declares that it would have adopted this Chapter and each section, subsection, sentence, clause and phrase thereof, irrespective of the fact that any one or more section, subsection, sentence, clause, or phrase be declared invalid. Page 67 of 285 TOOLS
RSS
Notify Me®
View Archived

CATEGORIES
All Categories
News &
Announcements
Budget & Finance
Homeless Strategic
Plan

NEWS & ANNOUNCEMENTS
Posted on: January 17, 2024
RENT STABILIZATION, JUST CAUSE FOR EVICTION TO BE CONSIDERED JAN. 30 As part of the City’s recent Housing Element update, which was approved by the State, the City Council committed to adopting rent stabilization and just cause for eviction policies to address tenant displacement.

On Tuesday, January 30, 2024, at 6:30 p.m. in the Council Chamber, the Concord City Council will consider a revised version of a draft Ordinance establishing Rent Stabilization (also referred to as Rent Control) in Concord and update Concord regulations on Just Cause for Eviction. The revised draft ordinance would amend Concord’s existing Residential Tenant Protection Program to include the proposed rent stabilization and just cause for eviction provisions.

Public Comment will be taken by the Council at this meeting. You must be present in person to participate in oral public comment. Please see the City’s agenda website on how to submit written public comment in advance of the meeting.

The staff report will be available on the City’s agenda website no later than Friday, January 26 at 5 p.m. The new draft Ordinance is currently being written by staff based on past Council direction.

Information on past Council discussions on this topic can be found by reviewing the Council meetings of January 9, 2024 and December 12, 2023

RENT STABILIZATION
Here is a brief description of major features to be included in the proposed new Ordinance:

Limit annual rent increases to 3% or 60% of the Consumer Price Index (CPI), whichever is lower.

Controls the allowable rent increases upon the first date of occupancy but does not control the dollar amount for starting-of-occupancy rent (i.e., it preserves vacancy decontrol).

Includes a “rent rollback” provision that sets rents to the dollar amounts that were charged for rent as of January 12, 2023, plus allows for up to the Ordinance-allowed rent increase of 2.52% for the 2023 calendar year (2.52% is 60% of the CPI for April 2023). Select Language Translate
Attachment 3

Previous
Concord Dog Parks to Close for Maintenance
Next
Summer Planning Starts Now

OTHER NEWS IN NEWS & ANNOUNCEMENTS

Rent stabilization would apply to multi-family rental complexes of 2 or more units built before Feb. 1, 1995. It would not apply to rented single-family homes, rented condominium units, or rented accessory dwelling units.

The Ordinance would establish a process utilizing a Hearing Officer whereby tenants could appeal their rent increases, if they believed them to be inconsistent with the City Ordinance, and whereby property owners could request higher rent increases, above what the Ordinance would otherwise allow, to obtain a fair return on their investment property.

JUST CAUSE FOR EVICTION
Here is a brief description of major features to be included in the proposed new Ordinance:

Just cause regulations do not apply when a tenant is evicted for “at-fault” reasons, such as non- payment of rent, breach of a material term of the lease, or occupying the space in such a manner as to create a nuisance or criminal activity.

Just cause protections for tenants would be triggered when a tenant is evicted for “no-fault on the tenant’s part” reasons, such as when an owner wants to move into the unit, wants to remove the entire complex from the rental market (Ellis Act eviction), or needs the unit vacant to perform substantial rehabilitations.

A “right of return” would be available in some instances, such as when substantial rehabilitation is completed, or if an owner returns the unit to the rental market within a specified time after an Ellis Act eviction.

Just cause for eviction would apply to most rented units in Concord, including rented single-family homes and rented condominium units. It would not apply to rented accessory dwelling units.

In the case of no-fault evictions, just cause provisions in the revised draft Ordinance would require the property owner to pay three times the Federal Housing and Urban Development (HUD) Fair Market Rent (FMR) and an extra $3,000 to cover moving expenses. If applied in 2024, the total payment required would range from $8,475 for a studio unit to $14,862 for a four-bedroom home, apartment, or condominium. Prices are set by HUD for each calendar year. Certain tenants, such as those over 62 years of age, or who are terminally ill or disabled, would be eligible for an additional month of FMR.

Everyone who owns property subject to either rent stabilization or just cause protections would be required to register their unit(s) with the City of Concord annually and pay a yet-to-be-determined annual registration and administration fee.

These are complicated new regulations being proposed and the Council has been discussing them for many months. If you are interested in this important policy topic, please take the following steps: (1) review the information provided in the links above, (2) register on the interested party e-mail list by emailing [email protected], and (3) attend the Council meeting on Tuesday, January 30. Only people attending in person will be allowed to speak at the meeting. You may also send comments on this topic directly to [email protected].

⇐ ⇒

CONCORD DOG PARKS TO CLOSE FOR MAINTENANCE
Posted on: January 22, 2024 | Last Modified on: April 15, 2019 Translate

City of Concord
Rent Stabilization and Just Cause for Eviction: Comparison Chart of Current Versus Proposed Policy (Revised: 1/24/24)

Attachment 4
Rent Stabilization
Current State Law Current City Policy Draft Ordinance
Units Covered
AB 1482:
• Multi-family rental buildings with 2 or
more units constructed more than 15
years ago
• Rented single-family homes and
condominiums, if owned by real
estate trust or corporation and
constructed more than 15 years ago.
• Note: Per State law, cities do not
have the ability to impose rent
stabilization on post-1995 units, or
single-family homes/condominiums
regardless of ownership.

N/A

• Multi-family rental buildings
constructed prior to February 1,
1995:
o Buildings with 2 or more
units (other than
duplexes where one unit
is owner occupied)
o Low Income Housing Tax
Credit (LIHTC) and other
affordable housing units
that DO NOT specify in
their affordability
agreements an allowable
rent increase percentage
that is equal to or less
than 5% per year.
• Mobile home units (versus
spaces)

City of Concord
Rent Stabilization and Just Cause for Eviction: Comparison Chart of Current Versus Proposed Policy (Revised: 1/24/24)

Attachment 4
Rent Stabilization
Current State Law Current City Policy Draft Ordinance
Exempt Units
AB 1482 exclusions:
• Single-family homes/condominiums,
not owned by a real estate trust or
corporation
• Units constructed within past 15 years
• Housing restricted by deed, regulatory
agreement with a government agency,
or other recorded document as
affordable housing
• Dormitories
• Owner-occupied duplexes

Note: Per State law, cities do not have
the ability to impose rent stabilization on
post-1995 units, or single-family
homes/condominiums regardless of
ownership.

N/A

• Units constructed after February
1, 1995
• All single-family
homes/condominiums
• Low Income Housing Tax Credit
(LIHTC) and other affordable
housing units that DO specify in
their affordability agreements an
allowable rent increase
percentage that is equal to or
less than 5% per year.
• Dormitories
• Owner-occupied duplexes
• Accessory Dwelling Units
• Unit where tenant shares kitchen
or bathroom with the owner

City of Concord
Rent Stabilization and Just Cause for Eviction: Comparison Chart of Current Versus Proposed Policy (Revised: 1/24/24)

Attachment 4
Rent Stabilization
Current State Law Current City Policy Draft Ordinance
Rent Increase
Limit AB 1482: Lesser of 5% + CPI or 10% N/A Lesser of 60% of CPI or 3% Petitions
Courts require that rent stabilizations
ordinance provide opportunity for
landlord to obtain a fair return on their
investment. Courts have found that the
maintenance of net operating income is
an acceptable method for achieving a
fair return.

N/A
• Tenant Petitions
• Owner petition for Fair Return on
Investment

Petition Costs N/A N/A
• No cost for tenant petition
• Owner covers cost of Fair Return
Petition
Rent Roll Back AB 1482: March 15, 2019 with Statute
effective on January 1, 2020 N/A

• For tenancies commenced on or
before January 12, 2023, the Rent in
effect on January 12, 2023 plus the
Initial Allowable Annual Rent
Increase.

City of Concord
Rent Stabilization and Just Cause for Eviction: Comparison Chart of Current Versus Proposed Policy (Revised: 1/24/24)

Attachment 4
Rent Stabilization
Current State Law Current City Policy Draft Ordinance
Rent Roll Back
Continued
• For tenancies commenced after
January 12, 2023, but before the
ordinance effective date, the Rent
charged upon initial occupancy plus
the Initial Allowable Annual Rent
Increase
• For tenancies commenced after the
ordinance effective date, the Rent
charged upon initial occupancy.

Just Cause for Eviction
Current State Law Current City Policy Draft Ordinance
Units Covered
AB 1482:
• Multi-family rentals with 2 or more
units constructed more than 15 years
ago.
• Rented single-family homes and
condominiums, if owned by real
estate trust or corporation
Same as Current State
Policy
• Multi-family rentals with 2 or more
units
• Rented single-family homes and
condominiums
• Low Income Housing Tax Credit
(LIHTC) units and other government
regulated affordable housing units.

City of Concord
Rent Stabilization and Just Cause for Eviction: Comparison Chart of Current Versus Proposed Policy (Revised: 1/24/24)

Attachment 4
Just Cause for Eviction
Current State Law Current City Policy Draft Ordinance
Units Covered
Continued

• Mobile home units (versus spaces)
• The above units are covered
regardless of date constructed
Exempt Units
AB 1482 exclusions:
• Units constructed within past 15 years
• Transient and tourist hotel occupancy
• Housing accommodations in a
nonprofit hospital, religious facility,
extended care facility, licensed
residential care facility for the elderly
• Dormitories
• Units where tenant shares bathroom
or kitchen facilities with the property
owner
• Single-family owner-occupant rents or
leases no more than two units or
bedrooms, including, but not limited
to, an ADU or JADU
• A duplex in which the owner occupied
one of the units
Same as Current State
Policy
• Consistent with AB 1482, AND
• Exclude rented ADUs and rented
rooms in a single-family
homes/condominiums regardless of
owner-occupant status and the
number of rooms being rented

City of Concord
Rent Stabilization and Just Cause for Eviction: Comparison Chart of Current Versus Proposed Policy (Revised: 1/24/24)

Attachment 4
Just Cause for Eviction
Current State Law Current City Policy Draft Ordinance
Exempt Units
Continued
• Units constructed within past 15 years
• Single-family homes/condominiums
unless real estate trust or corporately-
owned . Requires noticing to tenant of
exempt status
• Housing restricted by deed, regulatory
agreement with a government agency,
or other recorded document as
affordable housing

At-Fault Reasons
for Evictions
AB 1482:
• Default in the payment of rent
• Breach of a material term of the lease
• Nuisance
• Committing waste
• Tenant refusal of written lease
• Criminal activity
• Subletting in violation of lease
• Tenant’s refusal to allow owner to
enter unit
Same as Current State
Policy Same as Current State Policy

City of Concord
Rent Stabilization and Just Cause for Eviction: Comparison Chart of Current Versus Proposed Policy (Revised: 1/24/24)

Attachment 4
Just Cause for Eviction
Current State Law Current City Policy Draft Ordinance
At-Fault Reasons
for Evictions
Continued
• Unit use for unlawful purposes
• Employee failure to vacate after
termination of employment
• Tenant Failure to deliver possession of
unit after giving notice of termination.

No-Fault
Reasons for
Eviction
AB 1482:
• Owner intent to occupy unit
• Withdrawal from rental market
• The owner complying with any of the
following:

(a) An order issued by a government
agency or court relating to habitability
that necessitates vacating the
residential real property.

(b) An order issued by a government
agency or court to vacate the
residential real property.

(c) A local ordinance that necessitates
vacating the residential real property.

Same as Current State
Policy Same as Current State Policy

City of Concord
Rent Stabilization and Just Cause for Eviction: Comparison Chart of Current Versus Proposed Policy (Revised: 1/24/24)

Attachment 4
Just Cause for Eviction
Current State Law Current City Policy Draft Ordinance
No-Fault
Reasons for
Eviction
Continued
(d) If it is determined by any
government agency or court that the
tenant is at fault for the condition or
conditions triggering the order or
need to vacate, the tenant shall not
be entitled to relocation assistance
• Intent to demolish or substantially
remodel the residential property
Substantial
Renovation
Definition
AB 1482 and SB 567 (listed as a no-fault
just cause):

The replacement or substantial
modification of any structural, electrical,
plumbing, or mechanical system that
requires a permit from a governmental
agency, or the abatement of hazardous
materials, including lead-based paint,
mold, or asbestos, in accordance with
applicable federal, state, and local laws,
that cannot be reasonably accomplished
in a safe manner with the tenant in place
and that requires the tenant to vacate
the residential real property for at least
30 days.

Same as Current State
Law Same as Current State Law

City of Concord
Rent Stabilization and Just Cause for Eviction: Comparison Chart of Current Versus Proposed Policy (Revised: 1/24/24)

Attachment 4
Just Cause for Eviction
Current State Law Current City Policy Draft Ordinance
Substantial
Renovation
Definition
Continued
Cosmetic improvements alone, including
painting, decorating, and minor
repairs, or other work that can be
performed safely without having the
residential real property vacated, do not
qualify as substantial rehabilitation.

Temporary
Relocation
Options During
Substantial
Renovation and
Right of Return

AB 1482 defines substantial renovation
as a renovation that requires the tenant
to relocate for 30 consecutive days or
more.

N/A
For a relocation of 30 days or fewer
Property owner pays tenant per diem
rate for lodging and meals.

For a relocation of 31 days or greater
Property owner pays tenant per diem
rate for lodging and meals or at owners
election can offer tenant comparable or
superior dwelling
For both, tenant retain right to return at
same base rent with any authorized
annual increases
• Tenant must continue to pay
their lease rate rent with any
allowed adjustments

City of Concord
Rent Stabilization and Just Cause for Eviction: Comparison Chart of Current Versus Proposed Policy (Revised: 1/24/24)

Attachment 4
Just Cause for Eviction
Current State Law Current City Policy Draft Ordinance
Temporary
Relocation
Options During
Substantial
Renovation and
Right of Return
Continued

Property owner options:
• Relocate tenant to a comparable
or superior Dwelling Unit for
temporary housing
accommodations.

Permanent
Relocation
Assistance
Amount for No-
Fault Evictions
AB 1482: greater of one month of the
tenant’s rent or $1,000
Greater of two months of
the tenant’s rent or
$5,000

Relocation Assistance = 3 months of
HUD FMR Rent + $3,000 (Moving
Stipend)
In addition to the above, 1 month of
increased assistance at HUD Fair Market
Rent for protected (vulnerable)
populations including low-income
tenants, seniors, individuals with
disabilities, terminally ill tenants, and
households with school-age children.

City of Concord
Rent Stabilization and Just Cause for Eviction: Comparison Chart of Current Versus Proposed Policy (Revised: 1/24/24)

Attachment 4
Just Cause for Eviction
Current State Law Current City Policy Draft Ordinance
Effective Period
AB 1482: Eviction Protections are
effective after the following period of
tenancy:
(1) After 12 months
(2) After 24 months, if additional tenants
are added to the lease
Same as Current State
Policy Effective upon move-in
Ellis Act
Allows owners to remove rental
properties from the market if remove all
rental units located on parcel.

N/A
• Property owner records a
memorandum encumbering the
property for the ten years that it is
off-market
• Property owner pays tenants
permanent relocation assistance
• Tenant has right to return to property
if property is re-rented during ten
years after withdrawal

City of Concord
Rent Stabilization and Just Cause for Eviction: Comparison Chart of Current Versus Proposed Policy (Revised: 1/24/24)

Attachment 4
Both Policies
Current State Law Current City Policy Draft Ordinance
Enforcement Civil Remedies N/A
• Hearing Officer
• Civil Remedies
• Violation is a defense to eviction
Rent Registry
Fee None $5.25/unit
Anticipated Rent Registry Fees:
• Fully-Covered Units: $49-$52 per unit
• Partially-Covered Units: $29-$32 per
unit
Rent Registry
Fee Pass
Through to
Tenant
N/A None No pass through to tenant
Sunset Date AB 1482: January 1, 2030 January 1, 2030 N/A

City of Concord
Rent Stabilization and Just Cause for Eviction: Comparison Chart of Current Versus Proposed Policy (Revised: 1/24/24)

Attachment 4
Summary of Tenant Protections
Current State Law Current City Policy Draft Ordinance
Tenant
Protections
AB 1482:
• Rent increases are capped at the
lesser of 5% + CPI or 10% for all
eligible units
• Property owners must provide tenants
with notices describing the no-fault or
at-fault evictions, as defined in AB
1482
• Property owners must provide tenants
the opportunity to cure a curable just-
cause lease violation prior to issuing
an eviction notice
• For no-fault evictions, property owner
must provide permanent relocation
assistance equivalent to one month of
the tenant’s rent or $1,000, whichever
is greater
• Substantial rehabilitations are defined
as those requiring the tenant to
relocate for 30 days or more, and that
require building permits to be pulled
Residential Tenant
Protection Policy includes
the protections provided
by AB 1482, AND:
• Minimum lease terms
of 12 months, 6
months, or mutually
agreed upon term and
a lease in writing
• For no-fault evictions:

Permanent Relocation
assistance of two
times of the tenant’s
rent or $5,000,
whichever is greater
Includes protections provided in
current State and City policy, AND:
• Rent increases are capped at the
lesser of 60% of CPI or 3%, with a
rent rollback to January 12, 2023
rent.
• Rent stabilization and just cause for
eviction protections expanded to
cover a greater number/type of
units than those provided by
current policies and State law.
• At no cost to tenants, the City
provides for upward/downward
rent adjustments through a petition
process involving a hearing officer.
• After adoption of the Ordinance,
just cause for eviction protections to
begin immediately upon move-in.

City of Concord
Rent Stabilization and Just Cause for Eviction: Comparison Chart of Current Versus Proposed Policy (Revised: 1/24/24)

Attachment 4
Summary of Tenant Protections
Current State Law Current City Policy Draft Ordinance
Tenant
Protections
Continued
Ellis Act: Property owner must provide
120 days’ notice to tenants; one year
notice for seniors and tenants who are
disabled.

California’s Fair Employment and
Housing Act prohibits those engaged in
the housing business – landlords, real
estate agents, home sellers, builders,
mortgage lenders, among others – from
discriminating against tenants or
homeowners.

Further, California Civil Code Section
1940.27 also prohibits harassment of
tenants by landlords.
• Rent Registry –
multifamily rental
complexes of four or
more units must
register their units
and provide
information on
tenancy, rents, and
evictions.

Residential Tenant Anti-
Harassment Program
provides protections
based on State law, AND
includes the following
provisions:
• Violate or threaten
tenant’s quiet
enjoyment
• Fail to perform timely
repairs

• Residential Rent Registry expanded
to cover all rental units covered by
the rent stabilization and just cause
for eviction policy provisions.
• Increased permanent relocation
assistance.
o Relocation Assistance = 3
months of HUD FMR Rent
+ $3,000 (Moving
Stipend)
o In addition to the above,
1 month of increased
assistance at HUD Fair
Market Rent for
protected (vulnerable)
populations including
low-income tenants,
seniors, individuals with
disabilities, terminally ill
tenants, and households
with school-age children.

City of Concord
Rent Stabilization and Just Cause for Eviction: Comparison Chart of Current Versus Proposed Policy (Revised: 1/24/24)

Attachment 4
Summary of Tenant Protections
Current State Law Current City Policy Draft Ordinance
Tenant
Protections
Continued

• Abuse right of entry
laws
• Misrepresentation,
intimidation,
intimidation, or
coercion to encourage
tenant to vacate
• Discriminate against
tenant in violation of
Fair Employment and
Housing Act
• Refuse to accept rent
• Violate tenant’s
privacy
• Retaliate against
tenant

• Introduction of tenant’s right of
return and temporary relocation
benefits based on number of days
tenant is expected to be displaced
from unit.
• Substantial renovations require
building permits to be issued prior to
renovations taking place.
• Ellis Act fully implemented

City of Concord
Rent Stabilization and Just Cause for Eviction: Comparison Chart of Current Versus Proposed Policy (Revised: 1/24/24)

Attachment 4
Summary of Tenant Protections
Current State Law Current City Policy Draft Ordinance

Mobile Home Rent
Stabilization:
• Limits annual space
rent increases to 80%
of CPI
• Allows for a petition
process utilizing a
hearing officer

Attachment 5
Applicability of the Proposed Ordinance by Housing Type Revised: 1/24/24
Type of Unit
Rent
Stabilization
Just Cause
for Eviction
Single Family Homes/Condominiums
Multi Family Complex 2 or more units (built before
Feb 1, 1995)
Multi Family Complex 2 or more units (built after
Feb 1, 1995)
Accessory Dwelling Units
Mobile Home Units
Low Income Housing Tax Credit (LIHTC) Units (built
before Feb 1, 1995)
Low Income Tax Credit (LIHTC) Housing Units (built
after Feb 1, 1995)
Affordable housing with annual rent increases
capped at a 5% as indicated through regulatory or
deed-restriction agreements
Transient and tourist hotel occupancy
Institutional Facilities 1
Dormitories
Owner-occupied duplexes
Units where owner and tenant share kitchen and
bathroom
Emergency Shelters
Residential Facilities 2
1 Institutional Facilities include housing accommodations in a hospital, religious facility, extended care facility, licensed residential care facility for the elderly, or an adult residential facility as defined in City Municipal Code Chapter 19.40 Residential Tenant Protection Program.
2 Residential Facilities include group housing, residential care facilities, assisted living facilities, supportive housing, and transitional housing.

From: Ryan McMahon <[email protected]>
Sent: Sunday, January 14, 2024 8:37 AM
To: Birsan, Edi <[email protected]>; Obringer, Carlyn <[email protected]>; Aliano, Dominic <[email protected]>; Hoffmeister, Laura <[email protected]>; Nakamura, Laura <[email protected]>; City Clerk <[email protected]>
Subject: Concerns Regarding Rent Control Policy
Dear Concord City Council Members,
I hope this email finds you well. I am writing to express my concerns about the proposed rent control policy. While I understand the intention behind ensuring affordable housing, I believe that rent control may have unintended consequences.

Implementing rent control could discourage property owners from investing in rental properties, leading to a decrease in housing supply. This may result in a lack of maintenance and upgrades, ultimately affecting the quality of available housing.

Additionally, Most economists—left or right—think rent control is bad The below paragraphs are quoted from this this article- https://calmatters.org/housing/2018/01/5-things-californian-know-now- rent-control/
Economists have a hard time agreeing on most things. But regardless of partisan leaning, most economists would say rent control is not great policy. Even prominent progressives like Paul Krugman have expressed opposition to it.

Rent control is quite literally the textbook example of a “price ceiling”– undergrad economics textbooks will often feature problem sets with questions about what’s wrong with rent control. The classic microeconomic downsides include killing the incentive to build more housing, causing landlords to neglect maintenance and repair, and inflated prices for non rent-controlled units. A poll of ideologically diverse economists found that only 2 percent agreed with the statement that rent control had had a positive impact on housing affordability in cities like New York and San Francisco.

Attachment 6

Furthermore, rent control might not effectively address the root causes of rising housing costs. Exploring alternative solutions, such as increasing housing supply through streamlined regulations, could be a more sustainable approach to tackle the affordability issue. Abolishing parking minimums is another way to address this as it decreases the costs of new housing.

As a longtime Concord resident, I appreciate your time and consideration of these concerns as you deliberate on this important matter.

Sincerely,

Ryan McMahon

From: Dennis & Karen Gremer <[email protected]>
Sent: Sunday, January 14, 2024 10:46 PM
To: City Clerk <[email protected]>
Cc: [email protected]
Subject: Rental Restrictions

Mayor, Council Members, and the Public:

Late 1930's in Germany, Hitler started on a campaign against Jews, Unionists and Communists declaring these groups as greedy and unfairly bleeding the people and the country for their own benefit. His policies were met with enthusiasm from the public overall because most of the people weren't Jews, Unionists or Communists. It was only later the public realized the consequences of their actions when it was too late. Sorry for the history lesson, but the current City Council is embarking on a policy against landlords that mirrors what Hitler did. Too much?! The point here is Rent Control sounds good to the public overall today, but it is detrimental to the public and the city in the long run and it will be too late when the public realizes the consequences of these actions.

There are a number of studies that point out that Rent Control is detrimental to the city and its residents. A quick look at Oakland, San Francisco and a few other cities that have imposed rent control should be proof that, the studies declaring rent control a "failed policy", are grounded in reality. It is my sincerest hope that the Council will act in the best interests of Concord and its residents by easing Rent Control; not making it more restrictive.

If the Council is truly interested in providing more housing at a cheaper price, court perspective and current landlords. EXAMPLE: If you consider the current tax on landlords per unit as 100%, think about cutting that tax by 25%. If you get twice as many units as before, the city now will get 150% of the taxes it was getting before. This is the same model Costco uses; they sell each unit for less, but sell twice (or more) as many. Don't believe me; visit Costco in midday almost any day of the week and try to find a parking space (and their parking lot is huge). And how will this help the renters; Supply and Demand. With more Supply, Demand goes down, when Demand goes down, costs (rents) have to follow suit and go down; renters benefit. The city wins, renters win and landlords win; the only things to really consider are how much in benefits to give to landlords, how to hold landlords responsible for providing quality housing and how to handle landlord/tenant disputes.

Respectfully,
Dennis Gremer

From: Donna Remak <[email protected]>
Sent: Wednesday, January 17, 2024 10:55 AM
To: City Clerk <[email protected]>
Subject: Concerns about rent control ordinance proposal

I am writing about the rent control ordinance proposal being discussed at the next council meeting.

I own a home that I rent out in the city of Concord. I bought the home with my life savings in 2014. I own one home. My tenants have lived in my home since 2017.

They have children that attend the local elementary school. I retired 2017 after a 32 year career in office management. I haven't raised the rent for 2 years. I increase the rent to keep up with ever increasing taxes, and insurance. A rent control ordinance would restrict or limit my ability to maintain my home. A rent control ordinance would injure both landlords and tenants in the long run. My home is part of my retirement plan, a small supplemental income. A rent control ordinance for home owners like me would do more harm than good.

Please consider imposing such an ordinance on "Invtational Homes," a real estate company that owns hundreds of homes nationwide.

Sincerely,

Donna Remak
Homeowner
Registered voter

From: Elizabeth Schmidt <[email protected]>
Sent: Wednesday, January 17, 2024 9:20 PM
To: Birsan, Edi <[email protected]>
Cc: Nakamura, Laura <[email protected]>; Obringer, Carlyn <[email protected]>; Hoffmeister, Laura <[email protected]>; Aliano, Dominic <[email protected]>
Subject: Rent control proposals

Hello Edi and fellow council members:

Recently I read a post discussing rent control proposals under discussion by city council members.

I’m am messaging you to voice my disapproval of most of the rent control measures you are proposing for Concord.

I am in favor of a cap on allowed rent increases. I believe most of the other measures as proposed are overly penalizing to the landlord. A required Relocation payment of three months rent plus moving expenses is too much. The Restrictions proposed for an owner who wants to move into his/her own rental house are ridiculous .

FYI, I am not a landlord or a renter in Concord.

Elizabeth Schmidt
St.Francis neighborhood

Sent from my iPad

From: Kristy Powell <[email protected]>
Sent: Friday, January 19, 2024 3:36 PM
To: Birsan, Edi <[email protected]>; Obringer, Carlyn <[email protected]>; Hoffmeister, Laura <[email protected]>; Nakamura, Laura <[email protected]>; Aliano, Dominic <[email protected]> Cc: Barone, Valerie <[email protected]>; [email protected]; Huckabay, Sophia <[email protected]>; Merle Hall <[email protected]> Subject: Letter Dated January 19, 2024

Dear Councilmembers, City Attorney and City Staff,

Please see the attached letter concerning the proposed rent stabilization ordinance the Council is considering.

Thank you,

Kristy Powell
President
Walnut Creek Holdings, Inc.

P.O. Box 905
Concord, CA 94522
925.685.4246
palmterraceconcord.com

W
;;I WALNUT CREEK
=.HOLDINGS
P.O. Box #905, Concord, CA 94522
Tel. (925) 685-0586 Fax (925) 825-3888
January 19, 2024
To: Edi Birsan, Mayor
Carlyn Obringer, Vice Mayor
Laura Hoffmeister, Councilmember
Dominic Aliano, Councilmember
Laura Nakamura, Councilmember
Cc: Valerie Barone, City Manager
Susanne Brown, City Attorney
Sophia Huckabay, Housing Manager
Merle Hall, Owner, Walnut Creek Holdings, Inc.

Dear Members of the Concord City Council and City Staff, I trust this letter finds you well. My name is Kristy Powell, and I am writing to bring your attention to a matter of significant concern regarding the proposed rent stabilization regulations affecting the property I manage at
I understand and appreciate the goals of rent control in maintaining affordable housing within our community . However, I am facing unique circumstances with my property that I believe warrant an exemption from the proposed rent control measures.

Palm Terrace was approved for a Condominium Conversion by the Concord City Council on November 27, 2007. After its approval, the housing market collapsed in 2008 and Palm Terrace continued to operate successfully as a multi-family residential rental property. We sit on 8 acres of land and have 190 condominiums: a combination of 1-, 2-, 3-, and 4-bedroom units. We consistently maintain an average 97% occupancy rate. Our rents are at or below Fair Market Value (FMV). While these are interesting facts, what makes us extraordinary is our ability to sell our condos, and that is the legal right we do not want to give up or sacrifice by sections in your proposed ordinance.

While watching the last Regular City Council meeting on January 9, 2024, I made note of several questions and comments made by council members regarding Palm Terrace. Vice Mayor Obringer and Councilmember Hoffmeister made a motion to exempt Palm Terrace from the rent control ordinance and the mayor and remaining councilmembers expressed concerns and ultimately rejected the motion. While listening to the panel discussion, I truly believe lack of clarity and lack of understanding about what Palm Terrace is and what we offer is at the root of the confusion. I do hope the information forthcoming will help to answer these questions and address those concerns. Afterall, the purpose of rent stabilization is to control rent prices; our Condo Conversion approval provides exactly that.

As the Vice Mayor, Councilmember Hoffmeister, City Manager and City Attorney all referenced during the discussion on January 9t h, every individual and family who signs a lease agreement with Palm Terrace also

signs a "Condo Addendum Agreement". This agreement is present in all 190 lease files in our office. Our tenants are thrilled and excited by the thought of and opportunity to perhaps purchase their townhome in the future. It is not a deterrent to leasing at Palm Terrace, it is in fact, the opposite. Home ownership is a part of life that everyone wants the opportunity to have. Your proposed rent control ordinance, in its current form, will absolutely take that opportunity away from every current and future tenant at Palm Terrace. We simply won't be able to afford to pay relocation fees, keep our property pristine, employ our staff, and pay ever-increasing city fees on what appears to be a less than annual 1% rental annual increase for the coming year.

The following outlines our leasing program:

Palm Terrace Condominium Rentals - Unique Lease Features: Our lease contract is not the typical apartment rental agreement that runs for six or twelve months and then rolls over into a month -to-month rental agreement. Instead, it has a condo addendum that is intended for longer term occupants, and to prepare them for conversion into home ownership. The addendum does this in the following ways:

1. It notifies the customer they are renting a condo, not an apartment.

2. It lets them know they will have the Right of First Refusal to Purchase their unit when it is placed on the market for sale.

3. It they purchase their unit; they receive a 3% discount below market .

4. If they don't wish to buy when the unit is available for purchase, the lease protects them with a guaranteed minimum one-year notice to move.

5. While they are renting, the customer gets an initial two-year guarantee against rent increases.

Thereafter, they have access to market rent information, and they are further protected with discounts of up to 5% below market rents .

6. All these benefits are available only if the lease agreement remains continuously in full force and effect and is not allowed to expire and roll over to a month-to-month rental.

I think its sometimes easy or more convenient to "put everyone in a box", by that I mean you have two sides to this debate; the tenant advocates and the property owners, but not all of us necessarily deserve to be put in c;1 box because many of us are already offering the very thing you are asking for - fair and equitable opportunity at housing. Your duty as council members is to represent all of us.

In closing, I kindly request the city council's consideration for an exemption from the rent control regulations for my property at ■■■■■■■-■- In this case, I request a Motion to Reconsider.

I am open to engaging in further discussions and providing any additional information required to support my case.

Thank you for your attention to this matter, and I look forward to a positive resolution that ensures the continued viability of my property while upholding the principles of fair housing in our community.

Sincerely,
/~~viL-
Kristy Powell
President
Walnut Creek Holdings, Inc., agent of the owners of Palm Terrace Condominium Rentals

From: Leslie Baxter <[email protected]>
Sent: Monday, January 22, 2024 10:18 AM
To: Concord City Council Email <[email protected]> Subject: Rent Regulation

Dear City Council,

As a Concord resident and homeowner, I write in strong support of the proposed rent stabilization and just cause for eviction ordinances proposed for adoption at your January 30 2024 meeting.

Best regards,

Leslie Baxter

From: Merle Hall <[email protected]>
Sent: Sunday, January 14, 2024 7:24 AM
To: Birsan, Edi <[email protected]>; Obringer, Carlyn <[email protected]>; Nakamura, Laura <[email protected]>; Hoffmeister, Laura <[email protected]>; Aliano, Dominic <[email protected]> Cc: Barone, Valerie <[email protected]>; Travis Brooks <[email protected]>; Kristy Powell <[email protected]>; Rhovy Lyn Antonio <[email protected]>; Heather Schiffman ([email protected]) <[email protected]>; [email protected]; Judy Weil <[email protected]>
Subject: Exempt Approved Conversions

Mayor Birsan and Councilmembers,
You know, that even to a greater extent than ownership housing, the price of rent is a function of supply and demand. And you know there is a rental housing shortage in California. Yet, in the majority of other states in the country, the recent availability of cheap construction money has produced a glut of new apartments. In those states, the supply of rentals is exceeding demand, and it is actually bringing down the price of rent. (See WSJ, 1-2-2024).

What’s wrong with CA? It’s simple. The regulatory burden is too high. One example is City imposed impact fees on new apartment construction. Check this out; Oakland is $39,264/unit, Berkeley is $66,594, and SF is $74,597. What is Concord’s fee? Whatever it is, you should get rid of it. You should also allow the 300 units of Coast Guard Housing to be occupied, and you should stop mandating inclusionary zoning, and PLA contracts in all new apartment projects.

Those policies all add to the cost, and Concord can’t afford it. That’s why you get the fewest new apartments per capita each year of any central CC city. Your costly policies contribute to the shortage of apartments that makes the price of rent go higher. Change you policies and rents will go down. Regulate more, and rents will go up.

Now you are doubling down on that with your “Stabilization” program. You know that will be a disincentive to anyone wanting to invest in Concord. And you know that the lack of more investment in apartments in your city will exacerbate the shortages. And the shortages that you cause will make rents go even higher. Yes, that’s right. Government regulation always gets the opposite result. Regulate prices, and they go higher. How foolish is that? But that is not my issue. I am writing you on a simple technicality. Our project, Palm Terrace Condominium Rentals, (PT) is different. Because of that we are asking for an exemption to the ordinance.

Here’s some background: A few years ago your city sued me and my partners to force us to make serious investments at PT to catch up with deferred maintenance. But the City Council did not understand we were not just dealing with deferred maintenance. We were dealing with substantial design and construction defects that caused the deferred maintenance, and the defects had to be corrected for the project to even survive, let alone to be reasonably maintained. In addition, the entire project needed major renovation way beyond what the city had requested.

Nevertheless, the city filed suit on the maintenance issue alone, and it cost us half a million dollars in legal fees that should have gone into repairs. The saving grace was that the finished product so completely changed the character of the project that the Planning Commission approved conversion to condos on a unanimous 5-0 vote.

How could that happen? How could a City Council be suing an owner over maintenance issues, while the owner was doing much more than just the maintenance. In fact, so much more that the Planning Commission unanimously granted a condo conversion use permit. Among other staff

indiscretions, the city manager had lied to the council. Although the owners had never taken a cent out of it, he said they had “been bleeding this project for years, while making no serious re- investment ….” But the council also was at fault. They refused to meet with the owners, or inspect the project, to personally gain an understanding of the truth. As a result, the city wasted over a million dollars of taxpayer money on its legal fees.

It is ironic that a prior council was concerned about owners “making no serious re-investment”, while today’s council is proposing regulations that assure that owners will no longer make serious re-investments. But I digress.

At PT, the city got much more than it bargained for. Unfortunately, the housing bubble burst and the market crashed. In the meantime, we invested millions of additional dollars in reliance on the city’s promise to allow the condos. If adopted, your stabilization program will wreck that. It will cause the loss of millions invested by retired partners to preserve, and improve Concord housing.

As agent of those investors and their families, we cannot allow that to happen.

We’ve hired competent legal counsel who has written you, explaining our situation, and requesting we be exempted from this ordinance. You rejected that request on a 3-2 vote. Your only input was from staff. What dismays me more is that the old scenario appears to be repeating. That is a lack of communication, a refusal by councilmembers to meet with the owners, and inspect the project and learn first hand what is going on.

In the hope that you may be motivated to avoid more litigation, I’m copying you with the attached details of the wrap up of the former dispute. I’m confident none of you wish to again waste taxpayer money in a meaningless way that does the city no good whatsoever. I’m also conscious that one or more of you feel constrained with personal obligations to certain constituencies that may make it difficult to vote for the exemption. Nevertheless, the facts do not lie. The exemption is not only justified, it is legally sound. Therefore, it is my suggestion that as a whole, and to avoid leaving any one councilmember uncomfortable, you vote unanimously to grant the exemption. Give every councilmember cover for doing the right thing. In return, you will have avoided future bleeding of our project, and you will have assured continued re- investment in at least a portion of your affordable housing stock.

Respectfully yours,
Walnut Creek Holdings, Inc., agent of the owners of Palm Terrace Condominium Rentals at 2925 Monument Blvd., Concord
Merle D. Hall, Owner

1 WALNUT CREEK HOLDINGS, INC.
2925 Monument Blvd., #1, Concord, CA 94520
Tel: 925-685-0586, Fax: 925-825-3888

August 25, 2010

City Council
City of Concord
1950 Parkside Dr.

Concord, CA 94519

Re: City of Concord v. V. G. Partners Limited Partnership Request for: Waiver of Settlement Payment

Honorable Mayor Bjerke and Councilmembers,

On behalf of V. G. Partners, the owners of Palm Terrace Townhome Condominiums (formerly Village Green Apartments) located at 2925 Monument Blvd., Concord; this is to request a full waiver of the $300,000 (plus the interest) consideration negotiated in settlement of the above titled legal action.

Background: The action was brought by the City, in 2004, to enforce provisions contained in a “Stipulation” entered into between the City and the Owners, which required certain repair work to be completed in 2003, and which was not completed on schedule. The parties settled the action in April, 2006, after it became clear that the work was substantially complete. Subsequently, the property was approved for conversion into Condominiums.

The settlement agreement provided, among other things, that the Owner pay the City $3,000 upon the close of escrow of each condo sale until the total of $300,000 (plus interest at 2.5% per annum) be paid to the City as partial reimbursement of legal costs incurred by the City. Any remaining unpaid balance was to have been paid within 5 years of the settlement date (April, 2011).

At the time of the settlement, the condo market was strong and the project was expected to be sold out quickly. Unhappily, that did not happen, and the condos have not been sold. Accordingly, no payments have been made, and the entire lump sum is coming due.

Reasons to Grant the Waiver:

1. Hardship – It was anticipated that the settlement would be paid by installments upon the sale of each condo. It was not anticipated that the entire balance, plus interest, would need to be paid in one lump sum at a time in which the entire real estate market is suffering a loss of equity and lack of liquidity.

2 2. The City Received Windfall Benefits – The City’s objective with the Stipulation was to catch up with deferred maintenance in a low-income rental project. Due to the Owners extra work, the City got a complete renovation and upgrade of the project into ownership quality units that qualify as condominiums. The project is now repositioned in the market as one of the three premier residential addresses in Downtown Concord with a greatly upgraded occupancy.

3. The Legal Action Should Never Have Occurred – Evidence of managerial misfeasance by the City surfaced after the settlement. Due to the nature of the situation, it is reasonable to believe that certain counterproductive actions taken by the City prior to the action would have been avoided and that the action itself would never have been filed.

Commentary:

The first reason for the waiver request is self-explanatory. Had market activity continued at the same level it was in mid 2006; we would have been sold out, you would have your money, and we would not be having this discussion. Under the circumstances, however, our situation is as desperate as the next guy and we are literally at the point of having to lay off workers (see Exhibit A, note G) if this waiver is not granted.

The second reason for waiver is the result of two different visions for the property. The City vision was of an ownership that did little to maintain its property. It was looking at an accumulation of deferred maintenance that had turned a rental community into a low- income barrio. The City perspective was that of slum-lords bleeding the property to death. It wanted to force the owners to spend money to correct the unsightly appearance and catch up with the deferred work.

In fact, the ownership had been reorganized and the new leadership was determined to correct the business aspects of the situation that had put the project into Bankruptcy and were the root cause of the deferred maintenance. The Owners vision was to completely correct all operating problems and reposition the project in the market place with a whole new clientele. It anticipated a total renovation of the project … not just a cosmetic job.

During a recent visit to Palm Terrace, Dan Keene observed that the renovation work was above and beyond the requirements of the “Stipulation”. Recognizing that as a voluntary action, he wondered why we did more than the City requested. There are several answers; • It was absolutely necessary,
• It was always our plan, and
• We thought we had support from the City.

It Was Absolutely Necessary – The general perception was that the project was rundown due to a lack of maintenance. But, for every effect, there is a cause; and in this case the cause of the lack of maintenance was excessive operating costs for other items, most notably utilities, and especially the water system (see Notes, A) Old Water System).

Utility payments come ahead of everything else. If they aren’t paid, you’re simply shut

3 down and maintenance becomes a non issue. Survival, as either rentals or condos, first required correction of utility related defects.

None of the work required to correct the cause of the maintenance situation was included in the Stipulation. Correcting the cause of the problems required the installation of an entirely new water system, as an absolute pre-requisite to any effective renovation of the property … and the water system needed to be replaced before Stipulation work was done (note B).

It Was Always Our Plan – Our effort began when I took control of the project in 1997 by injecting my own money into a Bankruptcy Reorganization. In making my move; I saw the BART location, coupled with the garden townhome design, and no one above or below, as a winning combination for ownership grade urban housing. My vision included the new water system with separately metered utilities, and elimination of smelly and unsightly communal garbage dumpsters. In addition to all new grading, walkways, fencing, landscaping, and painting, my vision included a complete rebuild of the roof structures, and the addition of more parking, more carports, storage units, and vehicle gates.

We thought we had support from the City – The vision required a huge leap of faith, but the City wanted to see change, and I had previously obtained support from Bill Reeds and Bud Stewart for a conversion to condominiums in order to create the value required to attract the capital needed to do the work.

In a meeting with me later, Ed James expressed a desire to see immediate results. I countered that a lot of money would be required, and a change of use, from low income rental units, to high quality owner occupied units was essential to make it work. It was more than just a facelift job; financial feasibility required conversion to condos. After our meeting; Ed wrote the following to me on January 22, 1999:

“We discussed the conversion of Village Green from a rental project to a condominium project. Attached for your information and reference is a copy of the portion of the Concord Municipal Code related to condominiums. The code contains requirements for converting apartment units into condominiums.… As we indicated at the meeting, conversion of the project to condominiums may be a feasible approach to solving the problems. … It is certainly something that we are willing to explore with you and assist you in any way we can.”

This was extremely good news. We now had support from the City, we understood the problems, we had developed a feasible plan, and we were qualified. At Diablo Valley College, I instructed Real Estate Investments and was Chairman of the DVC Real Estate Advisory Committee. We even had prior experience renovating a dilapidated group of “garment district” buildings into an attractive new Retail Center, and earned a first place award from the Walnut Creek Action for Beauty Council. Prior to that, we converted a greasy old auto dealership into an attractive new Bank Building. I was an expert in real

4 estate operations; and renovation work was partly how I made my living. We were ready to go to work on this project.

But, before we started work, the City adopted a new “Apartment Inspection” ordinance.

Ours was one of the first projects targeted for inspection, and a City delegation met on site for an orientation meeting. I reviewed some of our major defects with Hamid Pouya, the head of the delegation, and explained our renovation plans. I expressed concern that money needed for our much larger, more important, and more comprehensive, renovation could be diverted by a cosmetic maintenance program. He assured me, “…not to worry, they understood our situation, they knew it was different, and they would work with us.”

That did not prove to be true. While the City of Concord lavishly bestowed grants of taxpayer money (note C) on other projects; virtually every move made by City officials throughout our renovation campaign either diverted, or attempted to divert, money (note D) from our core business plan and nearly destroyed our effort. The main distraction was the Stipulation. At the same time that we were preoccupied with distracting diversionary actions, staff applied pressure and wrote letters (note E) attempting to coerce us into giving up on our original plan. Worse yet, our efforts to initiate communications were rejected. Except for building inspectors, we were repeatedly denied access to key city officials and even council members (note E).

We had no choice but to stay the course. Our new water system was essential. It included removal of the old laundry rooms and the expansion of our parking lots, all of which enhanced the project. But this work postponed completion of landscaping … a big item in the Stipulation. To every professional involved in the work, it was self-evident that the water system and related items were absolutely necessary to correct the causes of the problems outlined in the Stipulation.

The Action Should Never Have Occurred – In December of 2003 a meeting was finally called. Attending, in addition to me, were council members Peterson, and Bonilla. Staff was represented by James, Labadie, Forsberg, and Pouya. The was primarily a series of staff admonitions to me, reciting their reasons to forget our new water system, and forget our condo upgrade plan, and citing why they would never approve condos anyway, why we would fail unless we did as instructed, and that they would sue me if we didn’t comply.

I asked James why he had changed his mind after previously meeting with me and previously recognizing that condominium conversion may be a feasible approach to renovation of the project, and after pledging to explore the concept … and to assist in any way he can. In the presence of Peterson and Bonilla, he denied ever having met and discussing condominiums with me. As of that time, I had lost possession of my copy of Ed James’s letter of January 22, 1999, so I could not refute his statement.

We had no choice but to go back to work:
• Over the next 30 months we spent 10.0 million dollars completing the upgrades and additions needed to qualify for condominium conversion … including an

5 entirely new, and separately metered water system with indoor washers and dryers in every unit, and with 35 additional parking spaces where old boilers were removed.
• The new water system conserved 2.1 million gallons per month and the new water heaters burned 30% less gas than comparable conventional units. • 8 months into the work the City filed the legal action to stop the work • Our cost to defend the suit was over half a million dollars … that money was diverted from the work … by an agency that should have cheered the work. • 26 months after the City filed suit, the Planning Commission approved our application for a Use Permit to Convert to Condominiums on a 5-0 vote. At the end of the meeting, the commission applauded us for the job we did, and asked if we wouldn’t consider cleaning up other Concord projects.

Managerial Misfeasance:

During the lawsuit the judge set aside a time for discovery; each side was required to hand over copies of all documents that had anything to do with the dispute to the other side. It turned out the City did not comply with the Court’s order.

Shortly after the lawsuit ended, Hamid Pouya resigned from City staff. When the files in his office were cleaned out a large quantity of documents relating to the dispute were discovered. They were copied and handed to our attorney … after the settlement.

The documents included:

1. Ed James’ letter of January, 1999: Ed James denied the existence of this meeting and of his commitment of support in the December 2003 meeting. Our original copy of this letter had been lost, but had it been available to us, we could have refuted his denials that misled the council members present for the meeting. Had the council members known the truth, they may not have sued. The action should not have occurred.

2. Ed James’ memo to the Council dated November, 1998. This memo was written following a meeting in which I had reported the exact causes of the financial difficulties of the project to Ed, including, the fact that I was now in control, and was putting in my own money, and that none of the owners had gotten any money out for years. Yet, with specific reference to me personally, it stated: “… My feeling is that he has been bleeding this project for years while making no serious reinvestment ….”

No greater distortion could have been stated … and in writing, no less. The truth was exactly the opposite, and the Council was misinformed. We now knew why we were fighting an institutional bias. Not only did we have a conflict of visions, but we had a conflict of perspectives; we are investing to create a grand vision, the City believes we are nothing more than slum-lords bleeding the property. We were indicted, judged, and jailed, upon totally false statements from top management.

6 This action should never have occurred; if the Council had been given the truth the action may not have occurred. Even with the action … had those documents, the letter and the memo, been handed over during discovery …we would never have settled. We would instead have counter sued the City for damages for fraud and for libel.

That is the furthest thing from our mind now. In fact, we are not interested in re-opening the action. We just want the settlement payment set aside. It was a shame that tax payer money was wasted to stop us from giving the taxpayers something much greater than they bargained for. Public agency misfeasance is bad enough, it would be even worse to add injury to insult. That can be avoided if the Council waives the payment.

It is now time to move on. For our part, we are satisfied with the effort. Aside from the constant frustration, we experienced a new level of learning and take pride in the results of our last best effort. Who knows, someday the condo market may even return and we will also have the satisfaction of knowing that we introduced a whole new ownership opportunity into the community.

In the meantime, we are proud of our new population. It is better educated, and in higher earning occupational categories; they bring more money to downtown Concord, and they pay higher rent; and because the pay their own utilities, they conserve them better … and they take better care of their homes. In fact, we have assumed a new position in the market place; and Palm Terrace Condominiums are now sought after, and stand among the premier residential addresses in downtown Concord.

Lastly, the urban decay previously creeping from the Monument corridor, toward downtown Concord, has been stopped dead by our renovation. The Planning Commission previously recognized our good work. The Council how has an opportunity to endorse that by waiving this onerous payment that should never have occurred, and that’s now threatening the jobs of our workers (note G). The best part is; it costs you nothing to waive something you do not have, and you get the satisfaction of knowing you did the right thing.

We very much appreciate your attention to this request … and the Palm Terrace Condominiums are open for tours at your convenience.

Sincerely yours,
Walnut Creek Holdings, Inc., agent of the owners of Palm Terrace

Merle D. Hall
President

Cc: Dan Keene, City Manager

Enclosure: Exhibit “A”, Reference Notes

1 EXHIBIT “A”
City Council – Reference Notes
August 25, 2010

A) Old Water System: Utility costs, including the water payments, the electric payments, the gas payments, and the garbage payments … and the costs of maintaining each of those systems … rose at double the rate of rent for two decades. Worse yet, much of the expenses were wasted. The water system was a good example:

1. Water was paid for by the owners and distributed with un-metered underground pipes beneath the buildings

2. The water came up into each unit under the concrete slab floors. The pipes were damaged and decaying and suffered serious leaks. Much of the water never made it to the faucet. The owners paid for more water than they needed.

3. Hot water was heated with gas in 5 boilers that each served 35-40 townhomes.

The gas was also paid for by the owners.

4. Each boiler had an electric motor that ran a recirculating pump needed to keep the water warm at the end of the line. The pumps used a large amount of electricity … also paid for by the owners.

5. Hot water pipes were in the ground, with no insulation, so gas was wasted; and the hot water pipes leaked worse than the cold water pipes. Thus, the owners paid for more gas than they needed.

6. Collateral Damage: In addition to excessive water, gas and electric costs, the owners experienced higher than normal costs to repair building and structural damage. The nature of the water system also caused marketing obstacles. For example;
• Boiler Repairs – 30 years old machines needed constant, costly repair • Slab Repairs – Hot water leaks required jack hammering to open the slabs and to do pipe repairs and then patch concrete floors in occupied units. • Rot, Mold, and Resource Depletion - Free hot water encouraged long showers, wasting more water, and producing steamy air condensing on windows and causing mold, and overflowing onto floors and causing dry rot.
• Marketing Objections – Boilers and laundry rooms were located in sprawling buildings on land needed for additional covered parking. The laundry rooms were crime magnets that discouraged good tenants.

Special Note – Boilers: The Stipulation required that we replace the boilers; so we did that at the beginning of work … even though we knew at the time that we would be replacing them later with a new system that involved individual hot water heaters in each unit. At the end of the project; we made a gift of the new boilers to St Mary’s College in Moraga.

B) New Water System: Over a four year period, project managers, architects, engineers, construction managers, plumbing contractors, and equipment suppliers were involved in the redesign of the water system; and then it took another three years to build it.

Construction involved an exterior, underground, plumbing contractor that dug up and

2 installed new pipes throughout the community. Then a re-pipe contractor, supported by an abatement contractor, tore open the interior guts of all 190 homes throughout the 21 building complex and installed all new hot and cold water pipes.

All this work was done while the homes were occupied. Fortunately, our homes have both front and rear doors, so while the back side of the buildings were dug up, people could get in and out the front, and vice versa. To compensate the residents for the inconvenience of having workers cut open the walls in their bathrooms and kitchens, we installed new laundry hook-ups in each unit … and then we gave each family a free washer and dryer … and free water and gas for the next six months.

Our water heaters were manufactured by Rinnai, the largest manufacturer of gas fired appliances in the world. We chose tank less units that reduce average household energy consumption by 30%, by using gas only when hot water is needed. We also metered the water to cut resource consumption. The entire system is minimal impact state of the art.

Absolutely none of these upgrades were included in the Stipulation.

C) Taxpayer Contributions to Multi-Family Projects in Concord: Concord is generally a lower income market. But PG&E rates, Water rates, Garbage rates, and other operating costs are generally the same in Concord as they are in Walnut Creek or Lamorinda, which are higher income markets that attract higher rents. Because the margins are lower, the risk of development is higher in Concord. Consequently, the City of Concord and its Redevelopment Agency, has stimulated new construction and the renovation of older projects, with subsidies of public money. For example:

1. Camara Circle – This neighborhood park was re-landscaped twice with direct cash injections.

2. Clayton Crossings – This mostly “Section 8” project was certified for Federal Housing Assistance and low interest rate loans.

3. Renaissance – This project was enabled with a 4.0 million mark-down on land exchanged for the site.

4. Lakeside – This older project (across the street from Palm Terrace) received a direct 4.3 million cash injection for acquisition and renovation

5. Park Central – This new project received a 20 year exemption of property taxes worth up to 8.0 million dollars. Today it is a direct competitor to Palm Terrace

D) Governmental Actions Diverting Financial Resources from Renovation: By now, it is well known that Ed James and Merle Hall did not get along. The reasons will likely never be known and are irrelevant. What is known is that a war existed. At the same time Ed issued his January 22 letter, supporting our interest in converting to condominiums, he was concurrently preparing Concord’s Multi-family Inspection Ordinance to go after Village Green. The ordinance was adopted the next year. The same year, while we were preparing renovation plans, he targeted our project with his first inspections and first Notices and Orders. They precipitated the following cascade of un-necessary distractions, that all diverted money from the renovation:

3 1. September 2000 – Notice and Order: The City issued an order to repair a sewer that had backed up. The obstructed sewer line was not unusual, the order was; and in this case, the Roto-Rooter Company was unable to clear the sewer. The repair job required complete excavation of an 8 foot deep trench to dig out and open the sewer line. They discovered that sabotage had occurred. Rounded river rocks had been placed in the sewer and jammed in the pipe. Continued incidents of deliberate sewer line sabotage occurred over the coming months … until we learned how to secure manhole lids in a manner that prevented them from being removed.

2. September 2000 – Class Action Lawsuit: Of course, we were never able to connect the sabotage and the lawsuit, but within one week after the order was issued, we were hit with a class action lawsuit. The attorney had obviously been copied with the order because the lawsuit precisely restated the wording in the order. In the end, the court did not certify the class, and threw out the suit. But, in the meantime, it wasted two years of our time, and it cost over a quarter of a million dollars to defend the lawsuit.

3. November 2000 – The first Multi-Family Inspection Report: This was the first major report completed for the new inspection program. It listed numerous items for “repair”. But it was impossible to comply with the 45 day turnaround time required by the inspection program. This report, therefore, was the basis for the “Stipulation” between the City and the owners. Negotiating the Stipulation took several months and cost the owners roughly $50,000 in legal and consulting fees before we even finished our renovation plan.

4. Redundant Repairs – The Stipulation required many repairs of items that were either discarded later, or could have been ignored until they were replaced after the primary renovation work was completed. The boilers were one example, others follow;

5. Patio Fences – Inspector’s were constantly requiring us to replace missing boards from patio fences … sometimes just weeks before we completely removed the fences to dig trenches for new pipes. We knew we would ultimately build all new patios and all new fences after the trenches were filled. So, we finally stopped this waste of labor and materials by simply removing all fences.

6. Meter Enclosures – This was a repeat of the fence problem.

7. Vector Control – Staff engaged County Inspectors to come in and divert our men to temporarily plug holes in siding that was scheduled for complete refinishing, and to trim trees that were scheduled for later removal. These actions were not only disruptive and wasteful; they were later admitted to be vindictive.

8. Painting Laundry Buildings – We repainted our residential buildings, but did not paint the laundry buildings because we knew we would be removing them when

4 the new water system was finished. Of course, we were required to go back and paint laundry buildings that were scheduled for ultimate removal.

9. Barricade Bollards – Midway through our work, an order was issued to install steel bollards to protect each of the one million BTU gas meters that served each of our five boilers, from possible vehicle damage. Now these are meters that had sat out in the open for 35 years with no protection; and these were boilers, and meters, that were slated to be removed in the end anyway. We were finally forced to retain legal counsel, at additional cost, to push back on this order.

10. The “Window Screen Incident” (2004 – The second Multi-Family Inspection Report): By this time we were in the middle of the water system and other upgrade work and we had several contractors, and our own men, maybe 30-40 men in total, at cost of several hundred thousand dollars each month. Trenches were open, and dirt piles were everywhere, and along came the apartment inspector. We asked her if she couldn’t wait until we finished. She refused. The result was another costly diversion of 3-4 men, for four months, to fix items that were open for construction, or scheduled to be replaced after construction. One of the items I recall from that experience was the window screens. In order to protect sliding door screens from damage during water line excavation, we removed them and placed plywood in front of the glass. The inspector required all the windows to have screens, so we stopped work to remove the dirt and plywood from the windows, and replaced the screens. At additional expense, and after she signed off on her report, we went back and removed the screens and replaced the plywood so we could start back up and continue to excavate and finish our work.

11. The Last Lawsuit: The funny thing is that all the time these things were happening, staff was complaining about why it took so long to finish our work.

Thinking it would speed things up; they sued us. Depositions kept me from work, and they went on for days. I had a single attorney. The City’s counsel would bring along three lawyers, all on taxpayer money. They had a good thing going. This lawsuit cost us another $550,000 of our own money that could have been used on the renovation.

We estimated, the total direct and indirect (delays, and duplication of labor and materials) costs of governmental intervention at over 2.0 million dollars. Looking at the whole situation from a distance, in retrospect; this was one of those examples of counter-productive governmental intervention in market driven productivity.

During this period, I bumped into Ed James at a political meeting, and complained that he was frustrating our efforts to improve affordable housing. I said, “this conduct can’t be what your Council wants”. He leered back at me and said he “… was doing exactly what his Council wanted”. At that time I had no idea he had written the council that I was “… personally bleeding this project for years ….”

5 Personality disputes aside, they do not justify misguided conduct by a public agency against an owner attempting to renovate its property in a proper and businesslike manner that is both absolutely essential for its survival; and a credit to the community.

E) Coercion – Attempts to Upset our Business Plan:

October of 2003 – The following letter from staff commented on our work priorities:

“…repairs and improvements have been completed or proposed … that were not identified in the Stipulation. These items include gates/security fencing … HVAC replacements … new water mains, and new gas lines. While we recognize your desire to make additional improvements to the complex, doing so diverts the limited funds from the stipulated items and delays completion of these items. The City believes that if any of these additional items break down or fail, they can be repaired on an as needed basis. Therefore, it is imperative that you redirect the focus back to the items agreed to in the Stipulation ….”

The irony of this is that while the gates/security fencing were not included in the Stipulation, Labadie later decided they were a good idea, so he demanded that we build them when he sued us … even though they were already 90% complete. Aside from the fact it was absolutely necessary to replace the water system, another irony is that while the HVAC and gas and water lines were not included in the Stipulation, it is a requirement of California law that a landlord provide heat and hot and cold water to its tenants, so under State Law, we had no choice but to maintain basic habitability levels for the 1000 people living in our community. If it wasn’t so serious at the time, it would be laughable to think that a local agency would attempt to direct a business to violate State Law in favor of its neighborhood beauty ordinance.

What was frightening was that this letter accurately portrayed the collective mentality of staff at that time. We were like doctors working to save a patient that needed a new heart, a new liver, and new lungs. Yet the City tried to coerce us to first do a new facelift, without regard to the fact that the patient was dying.

November of 2003 – It is often a breach of professional ethics to hold oneself out as an expert in a specialized area in which one is not trained or certified to practice. That should also apply to governmental intrusion in private business. Yet, the next letter was even worse than the last; it commented on our business plan as follows:

“There appears to be no realistic likelihood that the much higher quality standards prescribed in the Condominium Conversion Ordinance are achievable….” “We are unconvinced by your argument that converting … into a condominium complex will lead to improved property maintenance over the long term….” “We are naturally skeptical that commercial lenders would be eager to advance funds for improvements ….”

6 The writer was not a developer, an architect, an engineer, or even a contractor. He had no knowledge of the capabilities of me or my team, yet he held himself out as competent to guide the City Council on policy issues on which he was uniquely unqualified. These statements were totally misleading; and made with no information on how the utility costs, and the water system in particular, or the metering, or lack of metering, were in fact the actual underlying causes of the lack of maintenance. This was a specialist in governmental regulations. He wasn’t qualified to comment on commercial real estate finance, or even private equity, let alone to judge the financial plans of an acknowledged expert with a 40 year career in the field, and with no knowledge of the business plan, the credit arrangements or personal financial capacity of the expert or his partners. The letter demonstrated a complete lack of understanding of the situation.

F) Failure to Communicate: A favorite quote is “What we have here is a failure to communicate.” (Cool Hand Luke). Try as we might, no one would listen to us. After finally realizing staff was simply carrying out orders, I attempted to reach out to the Council and staff managers.

1. Council – We were repeatedly rejected by Council members who refused to speak, or to meet, or to return phone calls or to answer mail; or to otherwise respond in any way to requests for tours or dialogue

2. Forsberg – After the December 2003 meeting, I called Jim Forsberg in the hope that he would be willing to at least lend an open ear to our situation. He returned my call with a voice mail message rejecting my request to meet.

3. Planning Manager – During mid 2003 I had scheduled a meeting with the then Planning Manager to discuss our condo requirements. Just before the meeting, and before the receipt of the letters in 2003, I was notified that the meeting was canceled and that I was not to approach the City with that request.

4. City Manager – During the lawsuit the Judge remanded the litigants to Mediation.

Now then keep in mind that by that time, the litigation was essentially between you, the City Council, and Merle. So imagine my surprise when I arrive and no Council members are present. Instead the City is represented by a handful of cops and Lydia Du Borg. When the meeting began, the cops were sitting at the table, opposite me. Lydia was sitting in the back corner of the room. I turned to her and requested that she come to the table, instead of the cops, as she was the more direct agent of the Council. She refused, indicating she had other things to do, and had nothing to say to me. That day turned out to be another major waste of legal expenses.

5. Third Parties – While struggling to keep finding sources of money and to complete my project while under constant attack, and after years of frustration with City officials who refused to communicate; I finally had to spend even more money to hire outside consultants, with more influence with council members than Ed James, in order to finally make contact and begin to communicate.

Ironically, there are still members of the council who have never seen the actual details of the new units and the new water system and who have no idea of the financial and operating renovation that has been accomplished with this renovation.

7 G) Ongoing Improvements: We do not know if the condo market will ever return, but we have continued to work and to be prepared in case it does. Work completed pursuant to the Condominium Conditions of Approval, and since the crash of the condo market in 2007, totals over 1.5 million dollars, and includes the following:
• Underground Utilities – PG&E, AT&T, Comcast, and Astound cables have all been placed underground along the frontage of the project on Monument Blvd.
• Street Lights – New street lights have been installed along the sidewalk in front of the project on Monument Blvd.
• Laundry Buildings – All buildings formerly housing laundries, boilers, and shops have either been removed or converted to HOA facilities. • Parking Lot Expansion – Another 35 parking spaces have been added • Covered Parking Expansion – Another 80 carports have been added, and other auxiliary structures are under construction.
• Roof Replacements – New roofs have been installed on all 21 buildings.

This job was a complete rebuild including structural strengthening, a new deck, additional insulation up to current energy codes, and modification of mechanical equipment to comply with condominium acoustical requirements.
• Interior Townhome Upgrades– The first 5 condominium conversion remodels with ownership standard finishes are completed. In addition to oversize patios, storage rooms, and covered parking, these units now include; natural maple wood cabinets and granite counters, microwave oven with exhaust hood, extra bath in 3 BR units, cultured marble shower surround with brushed nickel enclosures, open stairs and Oak handrails with added under-stair storage, arched two-panel doors with new base, trim and window stools, bi-fold doors enclosing laundry closets, new electrical service, with added circuits, outlets and lighting, new rear slider, and a new front window to replace the old front sliders with the disputed screens. (This item of work will be terminated, resulting in layoffs of 6 full time workers, if the stipulation payment is not waived)

On Jan 21, 2024 9:42 PM, Anne Kendall <[email protected]> wrote:

Dear City Council,

I am writing to you today to request that you exempt residential properties (1-4 units) from the Rent Stabilization Ordinance that the City of Concord is considering. My reasons for this are below.

1. Residential properties are defined as 1-4 units. These landlords were not notified of this ordinance. Many owners found out through other sources shortly before the meeting on December 12, 2023.

2. Most residential units in the City of Concord are owned by individuals, and not corporations. These landlords do not look at their rentals as a business, but rather a long-term investment. This ordinance would force these owners to raise rents yearly, so as not to lose their opportunity in the future, which would go against what you are trying to accomplish with this ordinance.

3. Owners of 1-4 units typically work with their tenants when there are issues of non-payment, or other crisis that come up for their tenants. This ordinance would cause them to think twice about working with a tenant and could possibly give them the reason they need to have someone evicted so they could move someone else in at a higher rent, as this ordinance is so restrictive to these landlords that haven’t kept pace with market rents.

4. After speaking to some of these owners, I heard the following stories that will be a thing of the past if this ordinance is pushed onto residential (1-4 units) properties, and those who do not run their properties as a business:
- A tenant that did not get a rental increase for 19 years!! (paid $995 a month, far below market).
- A landlord that worked with a woman whose husband walked out on her and did not give her a rent increase for the remaining time she was there because her income had been severely affected (rent was at $1095…again far below market). - A man who came down with covid a couple of months ago and couldn’t work. He wasn’t given an eviction notice, was allowed to catch up over the course of a few weeks, and because he was a good tenant, forgave the late fee as well. - An elderly woman who lost her husband, and the landlord worked with her and reduced her rent to make it affordable for her while her family found other options for her. - These stories and many, many more will sadly no longer happen for the residents of the City of Concord who rent from these individuals.

You see, residential property owners typically buy property as a long-term investment, where over time they see the value of their property increase, it’s not all about the monthly rent. Most of these properties run at a loss for the first several years due to mortgage, property taxes and maintenance exceeding what they get for rent. These properties are small and do not have several units like apartment buildings to help increase their income to cover these expenses.

I understand when you have corporations that are running apartment buildings as a business, and are concerned about their profit and loss, and their return on investment, and they raise rents on a regular basis, that these tenants are greatly affected. I understand that there should be protections in place for

our most vulnerable tenants, and from large corporations that just look at them as a number. What I hope you understand is that those of us with properties that are 1-4 units get it. We get that folks don’t want to be forced out of their home; we honestly don’t want the turnover! We work with our tenants, in most cases to a fault! We work with them to find solutions that work for both tenant and landlord. This ordinance will take that ability away from us. We will be concerned about falling too far behind market rents and we will be forced to raise rents every year. We will be forced to treat our tenants and properties as a business, instead of just an investment where we get to also help people along the way.

We understand peoples’ lives are at stake, where someone lives becomes their home, and we respect that.

Please allow us to continue to treat our tenants with the respect they deserve.

Thank you for your consideration.

Sincerely
Anne Kendall

From: Doug Smith <[email protected]>
Sent: Monday, January 15, 2024 9:39 PM
To: Birsan, Edi <[email protected]>
Cc: Obringer, Carlyn <[email protected]>; Hoffmeister, Laura <[email protected]>; Aliano, Dominic <[email protected]>; Nakamura, Laura <[email protected]>; Barone, Valerie <[email protected]>
Subject: Re: Proposed Tenant Protections / Fair Market Rent Appeal request URGENT

Mr Birsan

Thank you for your response. Yes, there is an appeal process, however It is cost prohibitive for many and with restrictions so low, all owners who are able to, will be appealing, taking unnecessary time and wasting city resources. Additionally, it opens up the city to legal challenges from housing providers. At 60% of CPI (1% or less), it’s easy to argue this is not a fair rate of return.

Also, yes, rent can be raised to market if a resident vacates, however studies have shown that once rents fall so far behind market, residents don’t move.

With no means testing (even wealthy renters get the benefit of low rent), housing will be dominated by long standing, high income renters, leaving no housing for new renters in Concord. This has been happening in city’s like New York and San Francisco for decades.

I urge you to raise the cap to 5% and remove the roll back. Otherwise, I hope the appeal process is in place at the time this is voted on.

I also assure you that future low income housing will be very limited as banks and developers will not do business in Cocord. A more balanced and reasonable approach will benefit all involved. The plan as written, will ultimately hurt low income renters in concord and will degrade housing stock.

Thank you
Doug

Rent control will make housing shortages worse

Rent control will make housing shortages
worse
The latest trend in housing policy will compound decades of failure

Doug Smith
President
Fuller Enterprises
Broker License#1223373

925-866-8429

[email protected]

https://Apartments.Fullerpm.com/

3170 Crow Canyon Place #165
San Ramon CA 94583

On Monday, January 15, 2024, 8:46 PM, Birsan, Edi <[email protected]> wrote:

Interesting ideas. This is why we have an appeal process. Further remember that when there is a vacancy you can charge what you can get thus the number of units will decrease.

Edi Birsan
If you want to meet let me know.

Please take my independent survey
At www.PulseOfConcord.com

From: Doug Smith <[email protected]>
Sent: Monday, January 15, 2024 1:22:47 PM
To: Birsan, Edi <[email protected]>; Obringer, Carlyn <[email protected]>; Hoffmeister, Laura <[email protected]>; Aliano, Dominic <[email protected]>; Nakamura, Laura <[email protected]>; Barone, Valerie <[email protected]>
Subject: Proposed Tenant Protections / Fair Market Rent Appeal request URGENT

Dear Mayor and City Council,

I am a third-generation housing provider in Concord and operate 163 affordable units on Monument Blvd (Mountain View Apartments). We have had a great relationship with the City's housing department for many years and have even been featured by the City as an example of how well an owner can maintain their property despite the aging buildings.

It is important that you all hear my concerns so I will be brief as I know your time is valuable. Over the years, we have offered some of the most affordable housing in the Bay Area. We have also reinvested millions of dollars into our building so that we can continue to offer this affordable housing to hundreds of needy families.

Over the last 20 years, our rents have increased on average only 5% per year. This was accomplished despite rents falling 30% in 2001 and not returning to that level until 2011. Yes, 10 years with no increases at all and some years with increases as high as 13%, however overall, only 5% per year. Your proposal will not prevent rents from falling again, likely 20% to 30% but they will prevent us from ever getting back to today’s rents once they do fall due to your unrealistic restrictions. Additionally, as you know, expenses never fall.

Since COVID, we have experienced massive losses ($2,843,952.00) due to over 30% of the tenants not paying rent for over 3 years. We were unable to raise rent on those actually paying rent due to State and Local restrictions.

In 2023, we finally started to recover and began raising rents while still complying with 1482 State restrictions (9.5%). While these increases helped, they only amounted to about 3% per year (2020-2023). It also only effected about 70% of the residents as our occupancy was and still is in the mid 70% range. While any increase was welcome, it did little to offset the massive increases we faced due to supply chain and ramped inflation. All costs increased but major expenses like payroll, healthcare, insurance, construction, asphalt, etc increased over 15% annually from 2020 to 2024.

My major concern is that if you roll back rents to January 2023, it will amount to about an annual increase of less than 1 percent over the last 3 years at a time when expenses have increased on average 15% per year.

Additionally, because we are sitting at 74% occupancy today, we have dropped rents 18% and are offering 1 month free. We are still losing over $80,000 per month due to the high vacancy. A roll back would be catastrophic to us.

I urge you to reconsider the roll back as we were unable to raise rents during COVID and when we could, we were still restricted to 1482 limits.

If you pass this roll back and continue to limit increases to an unrealistic amount of 60% of CPI, I am requesting my appeal be heard day 1. I also promise to appeal annually as no property built in 1959 can adequately maintain an acceptable standard at 1.2% annual increases (60% of Fed target CPI of 2% is 1.2%). The City manager is proposing a 3.95% increase for the City in 2024, why can't we get the same? I would suggest that we tie the annual rent increase to the City's annual budget increase.

Thank you for your time.

Doug Smith

Concord City Manager Proposes 3.95% Budget Increase For Fiscal Year 2024

Concord City Manager Proposes 3.95% Budget
Increase For Fiscal Year 2024
Councilors eye $78 million for operating, $20.1M for
capital; employees get $1.3M more; social worker proposed f...

DOUG SMITH
President
Fuller Enterprises
DRE Broker License#1223373 ker License# 1223373

925-866-8429

[email protected]

https://Apartments.Fullerpm.com/

3170 Crow Canyon Place Suite 165
San Ramon CA 94583

From: Anne Kendall <[email protected]>
Date: January 22, 2024 at 10:23:40 AM PST
To: "Birsan, Edi" <[email protected]>
Cc: "Aliano, Dominic" <[email protected]>, "Barone, Valerie" <[email protected]>
Subject: Re: Request to exempt all residential properties (1-4 units) from Rent Stabilization

Yes, I think you understand what I’m trying to say. The corporations that are after the bottom line dollar are the ones that are affecting these folks the most.

I just want to be able to continue to treat people the way I would want to be treated, and this ordinance will force me to look at it the way the corporations do…and I hate that feeling….and I believe this goes against what you are trying to accomplish with this ordinance…and these would be the folks that would definitely be adversely affected.

Thank you for your response.

Anne

Sent from my iPhone

On Jan 21, 2024, at 10:45 PM, Birsan, Edi <[email protected]> wrote:

I understand your position and on the final ordinance issues will be reviewed.

One thing to reconsider is that the majority of rental units in Concord are not 1 to 4 complexes and remember the rent stabilization applies to buildings built before 1995, excluding single family homes and condo units.

However, I do think that that is the bed rock of your position.

Edi

On Jan 21, 2024 9:42 PM, Anne Kendall <[email protected]> wrote:

Dear City Council,

I am writing to you today to request that you exempt residential properties (1-4 units) from the Rent Stabilization Ordinance that the City of Concord is considering. My reasons for this are below.