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City Council Meeting: July 12, 2022 Santa Monica, California ORDINANCE NUMBER _________ (CCS)
(City Council Series)
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
SANTA MONICA ADDING SANTA MONICA MUNICIPAL CODE CHAPTER 4.25:
REGISTRATION OF NONRENTCONTROLLED RENTAL UNITS
WHEREAS, the State is experiencing a severe housing crisis that is driving the cost of living beyond the reach of an increasing share of the population; and WHEREAS, the City has long been committed to ensuring that Santa Monica is an inclusive and affordable community despite mounting market pressures; and WHEREAS, through discussions that occurred as part of the adoption process for the City’s major policy documents, including the Land Use and Circulation Element (“LUCE”) of the City’s General Plan in 2010, the current Housing Element in 2013, the City’s new Zoning Ordinance, Chapters 9.01 through 9.52 of Article 9 of the Santa Monica Municipal Code (“Zoning Ordinance”) in 2015, and the Downtown Community Plan in 2017, and recent amendments to the City’s Affordable Housing Production Program, the City has identified the need for a variety of housing types to serve all household sizes at all income levels; and
WHEREAS, with approximately 75% of its residents in rental housing, the City has maintained a long-standing commitment to protecting tenants and existing rental housing stock; and
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WHEREAS, increased demand for rental housing in the City, combined with rising housing costs across the City and the State, have made it increasingly difficult for those who live and work in Santa Monica to find rental housing that is available, affordable, and meets their needs; and
WHEREAS, Article XVIII of the City Charter, the City’s Rent Control Law, was first adopted in 1979; and
WHEREAS, State restrictions on a local government’s ability to regulate rents across tenancies or to apply rent control to buildings built after the adoption of a local law have substantially hobbled local entities’ efforts to ameliorate the worsening affordable housing crisis; and
WHEREAS, as rent-controlled units continue to be withdrawn from the rental market through the Ellis process and demolished and replaced with exempt units, the balance continues to shift toward fewer controlled units; and WHEREAS, as a result, most rental housing units in the City are exempt from the protections of the City’s Rent Control Law, and, therefore, do not improve the City’s housing’s affordability; and
WHEREAS, rental rates for market rate rental housing units within the City continue to increase even as the market-rate housing supply grows; and WHEREAS, Article XXIII of the Santa Monica City Charter, Housing Policies, provides, among other things, eviction protections for tenants living in rental housing units that are not subject to the City’s Rent Control Law (“Nonrentcontrolled Rental Units”); and
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WHEREAS, Santa Monica Charter Section 2305 authorizes the City Council to adopt ordinances, resolutions or regulations, and create any administrative mechanisms it deems necessary, to implement and effectuate the provisions of Article XXIII; and WHEREAS, requiring the registration of all Noncontrolled Rental Units could assist the City in a greater understanding of the scope of the affordable housing crisis in the City and in determining more effective ways to mitigate its impact, an impact that is driving housing instability, displacement, and greater numbers of the unhoused population; and
WHEREAS, the City Council finds and declares that requiring registration of Nonrentcontrolled Rental Units will: allow the City to gauge the effectiveness of the Article XXIII and to aid in enforcement of the tenant protections set forth therein; assist City officials in monitoring and mitigating the affordable housing crisis and ensure that the tenant protections in the City Charter are followed; better inform tenants of Nonrentcontrolled Rental Units as to their rights; and provide greater transparency about rental and occupancy rates for all rental units.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1. Santa Monica Municipal Code Chapter 4.25 is hereby added to read as follows:
Chapter 4.25 Registration of Nonrentcontrolled Units
4.25.010 Purpose.
The Council finds and declares that requiring the registration of rental housing units not subject to the provisions of Article XVIII of the Santa Monica City Charter, the 4 of 9
City’s Rent Control Law, will assist City officials in monitoring and mitigating the affordable housing crisis and ensure that the tenant protections in Article XXIII, Housing Policies, of the Santa Monica City Charter are followed; gauge the effectiveness of the Article XXIII and to aid in enforcement of the tenant protections set forth therein; ensure that tenants are better informed as to their rights under Article XXIII, and to obtain greater transparency about rental and occupancy rates for all rental units.
4.25.020 Definitions.
For purposes of this Chapter, the following words or phrases shall have the same meanings as set forth in Charter Section 2302 as follows:
(a) “Landlord” means an owner, lessor, sublessor or any other person entitled to receive rent for the use and occupancy of any rental unit, or an agent, representative or successor of any of the foregoing.
(b) “Nonrentcontrolled Units” or “NRUs” means All residential rental units in the City of Santa Monica except those units that are subject to rent control pursuant to Article XVIII of this Charter or are single-family homes. (c) “Rent” means all periodic payments and all nonmonetary consideration including, but not limited to, the fair market value of goods or services rendered to or for the benefit of the landlord under an agreement concerning the use or occupancy of a rental unit and premises including all payment and consideration demanded or paid for parking, pets, furniture, subletting and security deposits for damages and cleaning. (d) “Rental Housing Agreement” means An agreement, oral, written or implied, between a landlord and tenant for use or occupancy of a rental unit and for housing services.
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(e) “Rental Units” means any building, structure, or part thereof, or land appurtenant thereto, or any other rental property rented or offered for rent for living or dwelling house units, together with all housing services connected with use or occupancy of such property such as common areas and recreational facilities held out for use by the tenant.
(f) “Tenant” means a tenant, subtenant, lessee, sublessee or any other person entitled under the terms of a rental housing agreement to the use or occupancy of any rental unit.
(g) “Property” means all rental units on a parcel or lot or contiguous parcels or contiguous lots under common ownership.
(h) “Single-Family Home” means a property that has been developed with only one dwelling and any lawful accessory structures, or a lawfully created condominium, stock cooperative or similar unit that is part of a larger residential structure or complex.
4.25.030 Exemptions
(a) Rental units in hotels, motels, inns, tourist homes and rooming and boarding houses which are rented primarily to transient guests for a period of less than fourteen (14) days.
(b) Rental units in any hospital, convent, monastery, extended medical care facility, asylum, non-profit home for seniors, or dormitory owned and operated by an institution of higher education.
(c) Rental units which a government unit, agency or authority owns, operates, manages, or in which governmentally subsidized tenants reside only if applicable 6 of 9
Federal or State law or administrative regulation specially exempt such units from municipal control.
(d) Where a unit is actually used for purposes of providing, on a nonprofit basis, child care of other residential social services in accordance with applicable laws.
This exemption shall expire when the use upon which exemption is based ceases. This exemption shall only apply to units as they become vacant. This exemption shall not be construed to authorize the eviction of any tenant. The City may adopt regulations to determine whether a unit qualifies for an exemption under this Section.
4.25.040 Registration required
Upon issuance by the City of Santa Monica of a valid written Rent Registration certificate, as set forth in this Chapter 4.25, no Landlord shall demand or accept Rent for a Nonrentcontrolled Rental Unit (NRU) without first serving on the Tenant, or displaying in a conspicuous place, such Rent Registration certificate.
4.25.050 Registration Process
(a) A Landlord shall provide Rent amount and Tenancy information for every Rental unit on a Rent Registration form provided by the City. The Rent Registration form shall be submitted on a date to be determined by the City and on that date each year thereafter. Registration is complete only when all of the following information is provided: ownership information; property information; year built and certificate of occupancy date; number of bedrooms and bathrooms for each NRU; the amount of Rent in effect at the time of registration; a description of housing services; water/utility metering status of the unit; and the property vacancy rate. If any NRU has been vacant 7 of 9
for more than 30 days, the Landlord shall provide the date of vacancy and whether the vacancy is due to a buyout agreement.
(b) Every NRU Rent Registration certificate shall be updated annually, as required by paragraph (a), above, upon a new tenancy, or when there are changes in housing services.
(c) If an NRU is vacant for more than 30 days, the Landlord shall provide a certification to the City of the duration of the vacancy, and that the NRU shall be secured against unauthorized entry
(d) For every property for which a Landlord is required to procure a Rent Registration certificate pursuant to this section, the Landlord shall post a notice in a form provided by the City, providing information about this Subchapter 2304.5 and City contact information. Notices must be posted in a conspicuous location in the common area, at the entry or entries to the building or units, or other similar location or locations as necessary to provide Tenants a reasonable opportunity to view the notice. If there is no common area or similar location, this requirement may be satisfied by mailing the notice to each Tenant of the building, by certified mail, return receipt requested. The notice shall be written in English and Spanish, and in any other languages as required by the City.
4.25.060 Notice of Rent information deficiencies and opportunity to cure; Appeals; and Final Administrative Decision
(a) The City shall provide written notification to the Landlord of a failure to comply with this section and allow fifteen (15) calendar days to respond. The City shall 8 of 9
not issue a Rent Registration certificate for the NRU until the Landlord has substantially complied by providing the rental information as required by this section. (b) Any Landlord disputing the City’s notification of deficient registration may file a written appeal with the City Manager or designee within ten (10) calendar days of the date of the notice of deficiency. The City Manager or designee shall provide a written notice within thirty (30) calendar days of its appeal decision, which shall be a final administrative decision.
4.25.070 Registration fee
(a) A fee for the registration of NRU’s may be established by resolution of the City Council. Such fees are intended to recover the City’s reasonable costs associated with the administration and enforcement of this section. (b) A Landlord may pass through to the Tenant fifty percent (50%) of the annual fee for the registration of the Tenant’s NRU (the pass-through fee) if such Tenant continuously occupied the NRU during the period covered by the completed registration. The City may establish applicable conditions and procedures governing the pass-through. The pass-through fee is not considered Rent and should appear as a separate line item on the Rent statement. A Landlord may collect a maximum of onetwelfth (1/12) of the pass-through fee per month.
4.25.080 Administrative Regulations
The City Manager or designee may promulgate administrative regulations to implement the provisions of this Chapter, including, but not limited to, regulations related to additional annual registration reporting procedures and reporting requirements. No person shall fail to comply with any such regulations. 9 of 9
SECTION 2. Any provision of the Municipal Code or appendices thereto inconsistent with the provisions of this Ordinance, to the extent of such inconsistencies and no further, is hereby repealed or modified to that extent necessary to effect the provisions of this Ordinance.
SECTION 3. If any section, subsection, sentence, clause or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion of the ordinance would be subsequently declared invalid or unconstitutional.
SECTION 4. The Mayor shall sign and the City Clerk shall attest to the passage of this Ordinance. The City Clerk shall cause the same to be published once in the official newspaper within 15 days after its adoption. This Ordinance shall become effective 30 days from its adoption.
APPROVED AS TO FORM:
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DOUGLAS SLOAN
City Attorney