New Rent Control Law OKd by Council

The Los Angeles City Council gave its final approval Tuesday to a new rent control measure that will peg the maximum rate of increase permitted each year to the consumer price index but prohibit rents from being raised by more than 8%.

If Mayor Tom Bradley signs the ordinance, as expected, by the end of the month, it will take effect in July and replace the current law that allows increases up to 7% per year.

The new measure offers the most immediate relief to renters facing rate hikes between July 1, 1985, and July 1, 1986. Their increases will be limited to the current consumer price index rate, which is 4%. But renters eligible for increases between now and July 1 still face the prospect of 7% raises.

The proposal, approved Tuesday on a 9-4 vote, is the result of a compromise forged by landlord and tenant representatives at a series of meetings sponsored by the city’s Community Development Agency.

As the CPI has trailed downward over the last couple of years, landlords have hoped to preserve the 7% rate ceiling that has been in effect since 1979. Tenants, on the other hand, wanted to hold rental rate increases to 65% of the CPI, a formula more in line with a city-sponsored rent control study that found that landlords’ operating costs represented only about 58% of the CPI.

Besides setting an 8% ceiling, the measure establishes a 3% floor. In the event that the CPI falls below that level, landlords could still impose a raise of up to 3%.

With members of the council sharply divided on the issue, proponents of rent control looked for a compromise approach that would offer at least a temporary drop in the annual rate of increase.

The four council members who voted against the measure were David Cunningham, Howard Finn, Joan Milke Flores and Arthur K. Snyder. Two members, Hal Bernson and Robert Farrell, were absent.