Santa Monica Group Urges Day of Protest Over Rent Control

Shifting gears in its fight against rent control, a Santa Monica-based landlord group is calling on landlords in California, New York and elsewhere to join in a coordinated “day of protest” on Tuesday.

Organizers say landlord groups in about a half-dozen cities will stage rallies on the front steps of their state capitols or city halls to demand an end to what they contend are excessive housing price controls that have “devastated” housing supplies and led to a housing shortage.

The demonstrations will be used to unveil a “housing solution blueprint” that sponsors say would encourage the private sector to build more rental housing and to provide aid to the homeless in exchange for the phasing out of rent control.

“What we’re proposing is radically different,” said Geoffrey Strand, spokesman for the Santa Monica-based Foundation for the Defense of Free Enterprise, a year-old landlord advocacy group orchestrating the protest.

Supporters of rent control maintain that it is needed to ensure affordable housing in the face of sky-rocketing property and housing costs and to protect tenants from unfair eviction. They are likely to dismiss this action by the landlords as a last-recourse effort born of often unsuccessful fights against rent control in the courts and in some local political arenas.

The sign-waving, take-to-the-streets protest is a relatively new tack for many of the participating landlord associations, which tend to be small, loosely knit coalitions.

Tradition of Activism

“It says something when these kind of people are doing this,” said Roberta Bernstein, president of Small Property Owners of New York.

She and others say this sort of more militant response is made necessary by the long tradition of activism among tenants and their advocates.

“Our opposition is out there, screaming and booing at meetings. If we sit there like a bunch of middle-class dummies, we are going to get mowed down,” Muriel Rosenkranz, past president of the Berkeley Property Owners Assn., said. “We have to be activist.”

For Tuesday’s demonstrations, organizers say several New York landlord groups will be bused into Albany to converge on the state Capitol there. A group of landlords from Santa Monica and West Hollywood plan to rally at the Santa Monica City Hall, while others do the same at city halls in Los Angeles, Berkeley and Santa Barbara.

Nevertheless, the landlords’ effort has apparently failed to draw the participation of some of the larger property-owner groups. While supporting the anti-rent control cause, they seemed reluctant to embrace the planned demonstration.

In Los Angeles, for example, the rent control ordinance, which is less restrictive than Santa Monica’s, comes up for a periodic review soon, and there is speculation that some landlords may be reluctant to alienate officials right now.

“We are all generally coming from the same direction, just going about things a little differently,” said Stephen Carlson, executive director of the California Housing Council, a Sacramento-based lobbying group.

Extreme Reactions

Because rent control laws are less strict in some cities, some landlord groups apparently prefer to work within the system. Where rent control is considered more extreme, the response is often more extreme.

“People in the L.A. system feel (rent control) is working OK. I’m not saying they love it, but the alternative of a Santa Monica or a West Hollywood . . . “ Carlson said. “In a sense, (reasonable rent control) protects us from the worse.”

Rent control in Santa Monica and West Hollywood prohibits landlords from raising the rent when an apartment is voluntarily vacated.

Strand and his colleagues nevertheless see their plan as a novel approach that they hope will eventually catch the eye of important politicians.

Under the “housing solution blueprint” proposed by Strand and his associates, federal law would guarantee that all new multifamily construction would be exempt from rent control, but owners would pay $5 per unit per month for 12 years into a “Homeless and Housing Assistance” fund.

Yearly Rent Hikes

In addition, landlords of rent-regulated apartments could raise rent once a year by 10% or by the cost of living, whichever is higher. But 5% of all increases would go to the Homeless and Housing Assistance fund.

And 5% of state, federal and local business taxes generated by rental housing would go to the fund, which would be distributed by locally elected officials based on a “needs test.” Money from the fund could go only to homeless people, to shelters for the homeless or to needy tenants, but not to cover administrative costs.

Finally, under the proposal, rent control would gradually be phased out by June, 2000, though local governments would still be allowed to establish some protections for tenants.

“We are not suggesting that it be a free-for-all, (gouge)-your-tenant-any-way-you-can situation,” Strand said. “There should be reasonable regulations” that allow rents to approach market value.

Sponsors of the plan contend that overly strict rent control has backfired, a “mechanism gone berserk” that now benefits the wealthy more than the poor, minorities and “truly needy.” They contend landlords often end up subsidizing housing for the affluent.

Landlord Bias

Defenders of rent control blame the driving out of minorities and poor on discriminatory selection practices by landlords rather than by rent control laws.

“Thousands of senior citizens, thousands of low-income tenants would have been displaced if it weren’t for rent control,” said Santa Monica City Atty. Robert Myers, author of the city’s 1979 rent control law.

The landlord groups also maintain that strict rent control drives away new investors, discourages the upkeep of existing rental properties and depletes the housing stock.

They contend that rent control is used by politicians to buy votes, but that cities actually lose millions of dollars in potential tax revenue because rents are kept artificially low.

Though billed as a national protest, Tuesday’s activity is likely to be confined to California and New York, two states where rent control is still the strongest.

“By merging East and West Coast efforts, it raises everyone’s conscience (in parts of the country) in between so that they see they have an interest too,” said John J. Gilbert III, president of the Rent Stabilization Assn. of New York City Inc., who is coordinating with Strand’s group.