Los Angeles will cushion the blow of rent hikes for some tenants facing big increases, under a new program approved Wednesday at City Hall.
The Emergency Renters Relief program is meant to help tenants who are facing “exorbitant” hikes before California implements a new law capping rent increases. Under the program, L.A. will provide payments for up to three months to help eligible tenants who are facing rent increases exceeding 8%, according to housing officials.
“People are being gouged. ... They’re having increases of 25, 50% of their rent. To me, that should be an emergency,” Councilwoman Nury Martinez said to applause in the council chambers.
The rental subsidy, which would be paid directly to the landlord, would cover the amount of any increase beyond an 8% hike. (City officials had earlier pegged the amount at 9%, but later adjusted it based on criteria matching the state law.) If a family was facing a 50% rent increase, for instance, the city would cover the amount equal to a 42% increase.
Tenants and families who make 80% of the area median income or less — around $80,000 for a family of four — will be able to apply until Dec. 31, 2019.
To be eligible, tenants must still be living in their units and any eviction lawsuit for failing to pay the rent cannot have been adjudicated, a city report states. According to the housing department, the rent increase must have been effective on or after March 15 of this year, which is just after the new state rental rules were proposed.
Housing officials have estimated that for every $1 million spent on the program, approximately 250 to 400 families could be assisted, depending on how much aid they need. The council voted unanimously Wednesday to provide roughly $3 million for a city contractor to administer the subsidy program, drawing from funding already budgeted to assist tenants.
Councilman Paul Koretz called it an “excellent use” for the money, which he said was supposed to keep people off the streets.
“This is the most urgent case in which landlords are doing this en masse,” Koretz said Wednesday.
Housing officials said that tenants cannot seek the money for rent payments that they have already made, but could apply the subsidy toward rent payments that are in arrears, they said.
The vote comes amid reports that some landlords have jacked up rent or quickly booted low-paying tenants to maximize profit before the new state rules take effect in January.
Under those rules, annual rent increases for tenants in buildings older than 15 years will be capped at 5% plus inflation. Landlords covered by the law will also need just cause to remove renters who have lived in their units at least a year.
Last week, the City Council approved a moratorium on no-fault evictions and tenant groups urged them to go further.
Under the new state law, recent rent increases above the coming cap will be canceled as of Jan. 1. But tenants still have to pay now and landlords aren’t required to return any money, raising fears that large hikes are tantamount to an eviction.
Martinez, who proposed the rental subsidy program, had asked city staff to explore capping rents outright, before the state law took effect.
However, the city attorney advised the council that state law prohibits the city from placing caps on buildings not subject to its existing rent control ordinance, which generally covers buildings built on or before Oct. 1, 1978.
The rent subsidy program stands to mostly benefit people who already have received a hike. Landlords giving rent increases greater than 10% must already give 60 days’ notice, leaving hardly any time before the new state law kicks in.
Furthermore, a state of emergency is in effect as wildfires burn in Northern and Southern California. According to the state attorney general’s office, landlords at the moment generally can’t raise rent by more than 10%.
Craig Mordoh, general counsel for the Apartment Assn. of Greater Los Angeles, said officials have tended to enforce those rules only in cases of particularly dramatic increases, where there’s a reasonable connection between an emergency and increased demand for a given unit.
However, he said he advises all landlords to abide by the 10% cap while the emergency is in effect.