From the President

2003 Legislative Update

by Eric Andresen

Amazingly, here in San Francisco the political shenanigans of our representatives at city hall have been relatively quiet. A few horrendous ideas, including a rent freeze, have floated around, but so far we seem to be under less attack than in years past.

Local issues, such as the Gonzalez legislation, appear to be on the back burner, while more pressing issues are reviewed. The city’s budget crisis has caused a substantial drain on resources. This predicament, coupled with both the debate over “Care Not Cash” and the police department issues, has meant that for the time being our industry has not been in the limelight and is consequently receiving little attention or scorn. Don’t get me wrong though—bad ideas are still floating around.

Unfortunately, the same is not true at the state level, in spite of the seemingly insurmountable budget crisis. Legislators in Sacramento continue to debate deplorable initiatives. We have significantly stepped up our work at the state level this year. There is a whole slew of issues being argued up there that could substantially impact our industry. CAA is tracking more than 100 of them right now. I’ll try to summarize a few of the more important ones here, but remember that a lot happens between the time of this writing (early-August) and the actual time that this magazine is published, so some of the following information may be obsolete.

There are several good pieces of legislation that we, as an industry, are supporting. One, AB1384 introduced by Assemblyman Maddox on behalf of CAA, clarifies the issue of whether or not the required notice pertaining to the right to a pre-move-out inspection has to be provided when serving a three-day notice. Passage of the bill will exclude three-day notice terminations from the inspection requirement.

Assemblyman Steinberg has introduced two proposals that we are supporting as well. You may recall that I’ve had some issues with him on some of his past positions, but I’m swallowing my pride this year, and I admit that I appreciate what he is attempting to do. Both of his bills, AB1160 and AB1426, are directed at allowing for and providing for more affordable housing units. AB1160 proposes to loosen up local limitations on the creation of secondary units. AB1426 attempts to test a collaboration of state, regional and local agencies to determine if enhanced cooperation can result in the construction of more affordable housing.

We are also supporting a couple of bills that would increase the penalties on slumlords and further enable local agencies with more power to enforce health and safety standards. AB1034, by Assemblymember Mullin, increases the enforcement abilities of local authorities against residential property owners who continue to maintain dangerous and defective properties. AB647, from Assemblymember Nunez, would increase penalties against slumlords and force them to repair conditions more quickly. At our request, this bill also helps clarify that an owner must receive written notice from an enforcement agency before any tenant can claim damages.

As evidence of CAA’s improved presence and stature in Sacramento, we have managed to work with Senators Tom Torlakson and Sheila Kuehl in amending two of their proposals. We are quite appreciative of the efforts they have made on our behalf.

Senator Torlakson introduced SB90 in response to two highly publicized cases of the unethical use of security deposits. The senator clearly had the votes to pass the measure in its original form. The intent of the bill was to change the proof provided by a landlord when retaining some, or all, of the security deposit and to reduce the number of days before the balance of the deposit must be returned. The bill originally tried to reduce the period for return from 21 days to 16 days, if a landlord was mailing the disposition and/or deposit moneys. At our request, this language was removed. The original bill also required landlords to provide copies of actual receipts at the time of the return. Failure to provide such documentation would invalidate the deduction. Here again, the senator clearly heard our concerns and amended the bill to allow for an itemized statement, if receipts are not yet available, and to limit the time a tenant can request backup receipts to only 14 days after receipt of the itemized statement. His amendments also allow landlords to provide a written estimate, if work has not been completed or has not yet been invoiced, although the actual invoice will have to be produced within 14 days of completion.

Another big plus for us, again in deference to our concerns, is that landlords can now legally bill for their own time as long as the hours are documented and the charge is reasonable. In the past, most courts have not allowed owners to bill for their own time. In a further attempt to recognize our industry’s issues, Senator Torlakson also added some opt-out provisions. Receipts will not be required if the total deduction does not exceed $125. There is also an opportunity for a tenant to waive his or her rights to receipts in writing, provided the tenant signs after the notice to terminate has been given. Senator Torlakson went out of his way to be amenable to our concerns, and he deserves our thanks and our support.

Senator Kuehl intended SB345 to dramatically alter the way evictions were handled. First, the senator wanted to allow a tenant to reinstate his/her tenancy right up until the actual day of eviction. This language has now been removed at our request. She also wanted to increase the required occupancy period to five years for owners after an owner move-in eviction. This, too, has been dropped. The senator’s original bill would also have required landlords to attach to any eviction complaint copies of three-day notices or termination notices, a copy of the lease and a copy of any lease addenda such as house rules or covenants, conditions and restrictions. This requirement in the legislation no longer applies to evictions for non-payment of rent. It applies only to those evictions based on some other cause for the termination. The bill was also amended so that the owner will not be found liable to attach documents that are not in his/her possession or when the lease is oral. Originally, SB345 also sealed court eviction records for 60 days from the date of the judgment, rather than our current requirement of records sealed for 60 days from the date of filing. There is a big difference here, for the amendment would have made it all but impossible for a subsequent landlord to learn of potential eviction issues on incoming tenants. Again, she heard our concerns and dropped this provision.

In a further effort to assuage our angst over this legislation, Senator Kuehl also added an owner-friendly provision that allows entry by an owner to make repairs that have been requested by the tenant, without the written 24-hour notice. While we, as an industry, are still concerned about the remaining issues of the bill, we have moved from our opposition stance to that of neutral in recognition of Senator Kuehl’s efforts on our behalf.

There are also a couple of horrendous bills that we are fighting with all the energy we can muster. One, from our own Assemblyman Marc Leno, would remove Ellis Act protections from Single-Room Occupancy (SRO) units—commonly known as residential hotel rooms. The assemblyman introduced this bill on behalf of the Tenderloin Housing Clinic and Attorney Randy Shaw. While we have clearly voiced our total opposition to this bill, he has done little to make any meaningful or useful amendments. Somehow the bill did pass out of the Assembly and is now awaiting Senate committee assignment. We will definitely continue to carry on the fight against this bill until the end.

Assembly Bill 1256, introduced by Assemblymember Koretz, is one of many attempts to gut the state’s Costa-Hawkins Rental Housing Act. This ill-conceived bill would allow local communities to regulate rents on any housing with a certificate of occupancy issued more than 25 years ago. We’re not sure of the author’s intent, but the bill had trouble getting out of the Assembly committees and has now been given status as a two-year bill, which simply means that the votes aren’t there for it now. Perhaps it will be brought back next year. We hope not, but we will continue to do our part to kill this bill.

After using up all this paper and ink, I’ve only covered a small handful of the state legislation that our friends at the California Apartment Association (CAA) are diligently tracking on our behalf. For more information about the hundreds of landlord-related bills, go to CAA’s Web site at caanet.org and click on the Legislative Center link. Also, remember that both the SFAA’s and CAA’s Legal Funds and Political Action Committees are key to our continued success at city hall, the statehouseandin the courts.Please include these “check-off” contributions when renewing your membership or during our various fundraising drives.

The opinions expressed in this article are those of the author and do not necessarily reflect the viewpoint of the SFAA or the San Francisco Apartment Magazine. Eric Andresen owns West Coast Property Management and West Coast Property Maintenance Companies. He is also the treasurer of the California Apartment Association's Executive Board and serves on the boards of many other leading housing industry organizations. Questions or concerns should be directed to SFAA at 415.255.2288. You can email him at eric@wcpm.com