Community Development Agency
www.santa-ana.org/community-development
Item # 29
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
November 7, 2023
TOPIC: Second Amendment to Agreement with RSG, Inc.
AGENDA TITLE
Approve a Second Amendment to the Agreement with RSG, Inc. for the Administration, Management, and Implementation of the Rent Stabilization and Just Cause Eviction Ordinance on an As-Needed Basis in an Amount not to exceed $500,000
RECOMMENDED ACTION
Authorize the City Manager to execute a Second Amendment to the Agreement with RSG, Inc., for the administration, management, and implementation of the Rent Stabilization and Just Cause Eviction Ordinance, for an amount not to exceed $500,000, for a total agreement amount not to exceed $1,300,000, subject to non- substantive changes approved by the City Manager and City Attorney (Agreement No. 2023-XXX).
GOVERNMENT CODE §84308 APPLIES: Yes
DISCUSSION
On October 19, 2021, the City Council adopted the Rent Stabilization Ordinance (“RSO”) and the Just Cause Eviction Ordinance (“JCEO”) and authorized staff to enter into an Agreement with RSG, Inc. (“RSG”) for a one-year term in a total amount not to exceed $300,000 for the administration, management, and implementation of the RSO and JCEO. On September 6, 2022, City Council authorized the City Manager to execute a First Amendment to the Agreement with RSG in a total amount not to exceed $500,000 for the continued administration of the Rent Stabilization and Just Cause Eviction Ordinance (“Ordinance”).
Since October 28, 2021, RSG has been assisting the City to administer, manage, and implement the Ordinance. The City has needed RSG to administer the Ordinance during this time while staff have been establishing the administrative framework necessary for City staff to administer the Ordinance. This work has included the following required steps:
•Approval by City Council of a Rental Registry and Rental Registry Fee.
Second Amendment to Agreement with RSG, Inc.
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oThe Rental Registry and Rental Registry Fee was approved by City Council in the amended Rent Stabilization and Just Cause Eviction Ordinance on October 18, 2022.
•The procurement for a fee study consultant and the completion of a fee study to determine the Rental Registry Fee.
oFollowing the adoption of the amended Ordinance, staff issued a Request for Proposals for a fee study consultant. The consultant entered into an agreement with the City on January 3, 2023 and completed the fee study that was presented to City Council on May 16, 2023.
•The adoption of the Miscellaneous Fee Schedule and FY 2023-24 Budget. oFollowing the receipt of the fee study, City Council adopted the Miscellaneous Fee Schedule on June 6, 2023 and the FY 2023-24 Budget on June 20, 2023.
oOnly after the required steps above had been completed and the FY 2023-24 Budget was adopted, staff was authorized by City Council to begin recruitment for City staff to administer the Ordinance.
Although the City now has one full-time employee in the Rent Stabilization Division to administer the Ordinance, staff continues to need RSG to effectively administer the Ordinance and serve tenants and landlords in the community. Additional staff will be hired to administer the Ordinance after the City begins to collect revenue from the Rental Registry Fee; this is expected to begin in January 2024. Therefore, staff recommends that the City Council approve a Second Amendment to the Agreement with RSG for a total amount not to exceed $500,000 (Exhibit 1).
Under this Second Amendment, RSG will continue assisting the City to administer the Ordinance by providing the following services:
•Register rental units in the Rental Registry.
•Provide temporary staffing to respond to in-person and telephone inquiries from tenants and landlords regarding the Rental Registry and Ordinance. •Respond to continuous general public information inquiries via e-mail and telephone.
•Conduct outreach and engagement including Rental Registry workshops for landlords.
•Review and process Fair Return Petitions, Capital Improvement Petitions, and Tenant Petitions.
•Assist the City Clerk and staff with the formation of the Rental Housing Board, including Board member trainings, orientations, and materials. •Create outreach and engagement materials including periodically mailed letters, newsletters, e-mails, workshops, and website updates.
•Refer tenant legal matters and interpretation questions to community legal aid organizations, as needed.
•Calculate the allowable rent increase based on the Consumer Price Index. •Provide new and temporary staff training, including training materials.
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•Develop and conduct workshops for landlords and tenants. •Create required notices in multiple languages.
•Update Frequently Asked Questions.
RSG’s current scope of work will be removed and replaced as part of this amendment.
FISCAL IMPACT
When staff begins collecting Rental Registry Fees beginning January 1, 2024, funds will accumulate in an account specific to the administration of the Ordinance. Since the City needs to discern which units are nonexempt in the Rental Registry in order to begin the collection of Rental Registry Fees, $500,000 from the Inclusionary Housing Fund (41718820-62300 Contract Services) will be utilized initially for this Second Amendment in the current fiscal year. Funds are available from the City Council approved carryover amounts on September 19, 2023. Staff will explore reimbursement of the Inclusionary Housing Fund after Rental Registry Fee revenue is accumulated. In future fiscal years, funding will be included in the proposed Rent Stabilization Program budget for City Council consideration.
EXHIBIT(S)
1. Second Amendment to Agreement with RSG, Inc.
Submitted By: Michael L. Garcia, Executive Director of Community Development Approved By: Steven A. Mendoza, Acting City Manager