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SR-8B (17) CA:f\atty\muni\laws\barry\ellis.rev city council Meeting 7-19-94 88 Santa Monica, California JUL 1 9 'Z:1 TO: Mayor and City Council FROM: City Staff SUBJECT: Proposed Amendment to the Tenant Relocation Assistance Ordinance INTRODUCTION This report transmits for first reading a proposed amendment to Chapter 4.36 of the Santa Monica Municipal Code, the Tenant Relocation Assistance Ordinance. This amendment would make the provisions of this ordinance inapplicable when a tenancy is terminated or caused to be terminated pursuant to the Ellis Act and the displaced tenant does not qualify as a lower income household as defined by State law. BACKGROUND The Tenant Relocation Assistance Ordinance was enacted by the city Council on June 24, 1986 and amended effective March 29, 1990. This ordinance requires that monetary compensation and counseling be provided to any tenant whose tenancy is terminated for one of several grounds including a landlord seeking to withdraw all rental housing units from the rental market pursuant to Government Code section 7060 et seq., the Ellis Act. However, a recent appellate court opinion has interpreted the Ellis Act to restrict the authority of a local entity to require a landlord to provide JUL 1 9 199't 88 1 ~ relocation assistance when the landlord seeks to terminate the tenancy pursuant to the Act. More specifically, in Channinq Properties v. City of Berkeley, 11 Cal. App. 4th 88, 14 Cal. Rptr. 2d 32 (1992), the Court held that a city could not require that relocation assistance be provided to all tenants evicted from their property pursuant to the Ellis Act. Instead, a city could only require that relocation assistance be provided to lower income households as defined by Health & Safety Code section 50079.5. This statutory provision defines a lower income household to be persons and families whose income does not exceed limits for lower income families established by the federal Section 8 program -- eighty percent (80%) of area medium income. The appellate court reached this result by comparing two specific provisions of the Ellis Act -- Section 7060 (c) (1.) and section 7060(c) (2). The former section provides as follows: Notwithstanding Section 7060, nothing in this chapter does any of the following: Diminishes or enhances any power which currently exists or which may hereafter exist in any public entity to mitigate any adverse impact on persons displaced by reason of the withdrawal from rent or lease of any accommodations in any residential hotel, as defined by Section 50519 of the Health and 2 Safety Code, which is expressly reserved, or generally used for occupancy by lower income households as defined by Section 50079.5 of the Health and Safety Code. Subdivision (c) (2) provides: The reference to residential hotels in paragraph ( 1) is not intended by the Legislature to diminish or enhance any power which currently exists or which may hereafter exist in any public entity to require those same actions for other types of accommodations. The Channinq court interpreted subdivision (c) (l) to authorize relocation assistance to a specifically defined group, low income tenants in residential hotels. Id. at 99, 14 Cal. Rptr. 2d at 39. The Court determined that subdivision (c) (2) was subsequently added by the Legislature simply to clarify that cities retained the authority to require the provision of relocation assistance to lower income tenants residing in other types of housing. Id. The Court rejected the City of Berkeley's claim that subdivision (c) (2) allows a city to require relocation assistance to all displaced tenants since according to the Court such an interpretation would render subdivision (c) (1) meaningless. Id. The Court also concluded that the City of Berkeley's interpretation would place a 3 potentially insurmountable economic burden on landlords which would conflict with the intent of the Ellis Act. Id. at 100, 14 Cal. Rptr. 2d at 39. The proposed amendment herein to the City's Relocation Assistance Ordinance conforms the city's ordinance to the appellate court's interpretation of the Ellis Act. Thus, as amended, the requirements of the ordinance shall not apply to any tenant whose tenancy is terminated or caused to be terminated on the ground that the landlord seeks to withdraw the property from the rental business pursuant to the Ellis Act unless the tenant qualifies as a lower income household as defined by Health and Safety Code section 50079.5. RECOMMENDATION It is respectfully recommended that the city council accept the attached ordinance for first reading and hold a public hearing thereon. Prepared By: Marsha Jones Moutrie, city Attorney Barry A. Rosenbaum, Deputy city Attorney 4 CA: f\atty\muni\laws\barry\ellis. rev City Council Meeting 7-19-94 Santa Monica, California ORDINANCE NUMBER (CCS) (City Council Series) AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA AMENDING THE TENANT RELOCATION ASSISTANCE ORDINANCE TO MAKE ITS PROVISIONS INAPPLICABLE WHEN A TENANCY IS TERMINATED PURSUANT TO THE ELLIS ACT AND THE DISPLACED TENANT DOES NOT QUALIFY AS A LOWER INCOME HOUSEHOLD WHEREAS, the Ellis Act, Government Code Section 7060 et seq. contains provisions governing a local entity's authority to impose relocation assistance requirements on an owner who withdraws residential rental property from the market pursuant to the Act; and WHEREAS, the California Court of Appeal in Channinq v. City of Berkelev, 11 Cal. App. 4th 88, 14 Cal. Rptr. 2d 32 (1993) has interpreted these provisions to prohibit a local entity from requiring an owner to provide relocation assistance unless the displaced tenant qualifies as a lower income household; and WHEREAS, the city Council is obligated to amend the city's Tenant Relocation Assistance Ordinance, Santa Monica Municipal Code Section 4.36 et seq. to conform to the appellate court's interpretation of the Ellis Act; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES ORDAIN AS FOLLOWS: SECTION 1. Section 4.36.120 of Chapter 4.36, the Tenant Relocation Assistance Ordinance is amended to read as follows: (a) Notwithstanding Section 4.26.110, the requirements set forth in this Chapter shall not apply to any tenant whose tenancy is terminated pursuant to a lawful notice to terminate tenancy pursuant to section 1806(h) of the City Charter served on or before June 10, 1986. (b) section 4.36.100 shall not be applicable if the displacement and relocation of the tenant is the result of a fire not caused by the landlord, earthquake or other natural disaster. '- :'. , r. :, ". .. I U.. t 1 j. r, I :" ("II. . - ' c " I, r It' ..) , I. _ ~( , , . 11II . ;, i . ~.. . . , . .". j, I I : I ~ ;. ~:, II L - " , , tt(.- rl '1:.!~' 'ill i 1I.(".~" IUil"'"'. ]... T-::. ~:"~I:'''~.r!' ''',:l~,)ll I.'t.: 11:.IJ I." t-,.. .,\-.1: '-:".!'I,.Jnt- "III1'.L,:,I.('11 t ""l-'r~,.,. :.- r r t- :. , 1- ll'" .1 :") f ( ~ .:"( ! t ~ L.h ~..: I 1'- I........ :. n r'll 'Jrl,J1~'l'"",'- t---r . 'l:I:~n':: '~Ptol,,~ t:. ';.,1 t'l it- I".. .1 """'11- "'1. ... .. J ; I j In. I' :. r ":""" ":" I. C' t--'l--lJ -1:].("- ;.; ro': I '.r ~ ... (~, ,'~'r 1:1~"t (".~,:(, :.( I.~ {'I": 1 . ~ (- "!':' . .....1 I ~. t t I ., t!....1 - t- q I,: . I . ( ': , - , - .~'" I ! I . I.... ,,1-..11' n '1.:.-1 III :.J:- ~.I:'r.'" --:c: it- I. -.~ : -..: .'.11 ."t.,; ~. ~ jl. ,I, ..:tJ: r... =.~...,. ....- SECTION 2, Any provision of the Santa Monica Municipal Code or appendices thereto, inconsistent with the provisions of this Ordinance, to the extent of such inconsistencies and no further, are 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 any 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 be effective 30 days from its adoption. APPROVED AS TO FORM: 1lt~s-L,L~h~ MARSHA JON~ MOUTRIE City Attorney Revenue Account No. 01-500-421-00000-0179-10000, "Sidewalk Repair Revenue." Any unpaid assessments will be placed on the 1994-95 property tax roll by the Los Angeles County Assessor's Office. Recommendation It is recommended that City Council: 1. Open the public hearing 2. Close the public hearing 3. Acknowledge any protest and adopt the attached Resolution confirming the assessed costs Prepared by: Craig Perkins, Director of Environmental and Public Works Management Department Tony Antich, City Engineer Attachment: Resolution Notices of Assessment and Time of Public Hearing street Superintendent's Report List of Property Owners 5