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SR-05-05-2015-7ACity of City Council Report Santa HollicA City Council Meeting: May 5, 2015 Agenda Item: . — To: Mayor and City Council From: Marsha Jones Moutrie, City Attorney Subject: Ordinance Prohibiting Housing Discrimination Based On Source of Income, Including Section 8 Vouchers and Other Rent Subsidies Recommended Action Staff recommends that the City Council introduce for first reading the attached ordinance amending the Santa Monica Municipal Code section 4.28.030 to prohibit housing discrimination based on the source of a tenant's income and section 4.28.060 to increase the penalties for housing discrimination violations, and to add injunctive relief to the civil remedies. Executive Summary Council has received complaints that some local landlords will not rent units to tenants who receive housing assistance in the form of rent subsidies such as Section 8 vouchers. And, Housing Division personnel have noted that tenants receiving Section 8 vouchers often cannot find housing within the City. Accordingly, Council directed staff to prepare an ordinance that would prohibit housing discrimination based on the source of income. The attached ordinance fulfills that directive. It would add discrimination based on the source of income to the existing list of prohibited forms of housing discrimination. Under the civil remedies section, the amendment would also increase the penalty for a violation from $500 to a range of $1000 to $10,000 while also adding injunctive relief. Background As real estate values have continued to increase and market rents have continued to rise, low income renters have experienced great difficulty locating housing within the City. Many of those seeking rental housing are long -time City residents forced from their homes by circumstances beyond their control. And many are low- income individuals and families who receive rental assistance, most often in the form of Section 8 vouchers. 1 Many voucher holders have reported to Council members that some local landlords refuse to rent to voucher holders, either in particular cases or even as a business practice. These reports are consistent with Housing staff's observations that Section 8 tenants experience disproportionate problems finding homes in Santa Monica. Accordingly, on December 16, 2014, Council directed staff to prepare an ordinance that would prohibit such discrimination. The current civil remedies section of the City's Housing Anti - Discrimination Ordinance does not include injunctive relief and the penalties for violations are capped at $500. These limitations do not give judges sufficient flexibility to assess proper penalties and deter future acts of discrimination. Earlier this year, Council approved increased penalties for violations of the Tenant Harassment Ordinance to range from $1000 to $10,000. Discussion State law already prohibits discrimination against tenants based on their source of income. However, in a case involving a well -known Santa Monica landlord, a court determined that Section 8 vouchers are not an income source under state law. This decision was later codified under the state law. Therefore a local provision is necessary to prevent discrimination against voucher holders. While federal and state fair housing laws do not protect Section 8 voucher holders, they also do not preempt local laws that prohibit such discrimination. Accordingly, twelve states, nine counties, and eighteen cities have made such discrimination illegal in three basic ways. The California cities include San Francisco, Corte Madera, East Palo Alto, and Woodland, and three of these city ordinances demonstrate the three basic options to prohibit Section 8 discrimination: E 1. Banning all source of income discrimination, including in the definition of "source of income" any participation in rental assistance programs or housing subsidy programs. This is the East Palo Alto model. 2. Requiring landlords to accept Section 8 vouchers only from existing tenants who qualify for Section 8 after moving in. (Corte Madera) 3. Prohibiting discriminating against Section 8 voucher holders only as to housing developments with affordability restrictions. (Woodland.) The attached proposed ordinance would fulfill Council's directive by adding discrimination based on source of income to those forms of housing discrimination already prohibited by local law, and would make clear that Section 8 vouchers are included within the protection. Thus, it would fill the gap in tenant protection created by the state's narrow definition of "source of income." One concern over prohibiting all such discrimination — including against applicants and in -place tenants —is that owners might raise their rents above the Section 8 payment standards to make the use of vouchers impossible. The attached ordinance also increases the statutory damages for violations from $500 to a range between the sum of $1000 and $10,000. This will give judges sufficient flexibility to assess proper penalties. Injunctive relief is added as a civil remedy as it is often needed to deter future acts of discrimination. Alternatives Given the state's narrow definition of "source of income ", the only other alternative available at the local level is to impose a local prohibition such as the one contained in the proposed ordinance, but have it apply only to already existing tenancies. Such an ordinance would protect tenants whose source of income changes. 3 Next Steps If Council adopts the proposed ordinance, the Consumer /Fair Housing Division of the City Attorney's Office and the Housing Division of the Housing and Economic Development Department, will provide information about the new provision of law to the landlord and tenant communities to ensure that those communities have notice of their new rights and responsibilities. Financial Impacts & Budget Actions There is no immediate financial impact or budget action necessary as a result of the recommended action. Prepared by: Marsha Jones Moutrie, City Attorney roved: Forwarded to Council: Elaine M. Polachek Interim City Manager Attachments: Ordinance Prohibiting Housing Discrimination Based on Source of Income S City Council Meeting: May 5, 2015 Santa Monica, California ORDINANCE NUMBER (CCS) (City Council Series) AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA PROHIBITING HOUSING DISCRIMINATION BASED ON SOURCE OF INCOME, INCLUDING SECTION 8 VOUCHERS AND OTHER RENT SUBSIDIES WHEREAS, the City of Santa Monica is committed to providing and preserving affordable housing for all segments of the community as a matter of social justice and to preserve diversity; and WHEREAS, the City of Santa Monica desires to eliminate any discrimination in the provision of housing, including discrimination based on a person's source of income; and WHEREAS, the City of Santa Monica Housing Authority, which administers the Section 8 program, reports a shortage of landlords participating in the Section 8 program; and WHEREAS, this shortage may reflect discrimination against the holders of Section 8 vouchers; and WHEREAS, discrimination against Section 8 voucher holders significantly reduces the pool of housing that is available to them; and 1 WHEREAS, California and federal law requires the City to identify impediments to providing affordable housing and discrimination -free housing and to develop strategies for removing those impediments; and WHEREAS, in order to fulfill its commitment to fair and affordable housing opportunities and to fulfill its legal obligations it is necessary to prohibit housing discrimination based on source of income; and WHEREAS, the current fixed civil penalty of Five Hundred Dollars ($500.00) for violations of the Housing Anti - Discrimination Ordinance is insufficient to deter violations of that law and provides judges insufficient flexibility to assess proper penalties; and WHEREAS, the civil penalty for violations of the Housing Anti - Discrimination Ordinance should be amended to the range of One Thousand Dollars ($1000.00) up to Ten Thousand Dollars ($10,000.00); and W WHEREAS, injunctive relief is often needed to deter future discriminatory acts; WHEREAS, the Housing Anti - Discrimination Ordinance should be amended to include injunctive relief as a possible civil remedy. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES HEREBY ORDAIN AS FOLLOWS: SECTION 1. Santa Monica Municipal Code Section 4.28.030 is hereby amended to read as follows: 4.28.030 Prohibited activities. It shall be unlawful for any person offering for rent or lease, renting, leasing, or listing any housing accommodation, or 2 any authorized agent or employee of such person, to do or attempt to do any of the following: (a) Refuse to rent or lease a housing accommodation, or access to or use of the common areas and facilities of the housing accommodation, serve a notice of termination of tenancy, commence an unlawful detainer action, or otherwise deny to or withhold from any person or persons, a housing accommodation on the basis of disability, age, source of income, parenthood, pregnancy, or the potential or actual occupancy of a minor child. (b) Represent to any person, on the basis of disability, age, source of income, parenthood, pregnancy, or the potential or actual occupancy of the minor child that a housing accommodation is not available for inspection or rental when such housing accommodation is in fact available for inspection or rental. (c) Make, print, or publish, or cause to be made, printed, or published any notice, statement, sign, advertisement, application, or contract with regard to a housing accommodation offered by that person that indicates any preference, limitation, or discrimination with respect to disability, age, source of income, parenthood, ic3 pregnancy, or the potential or actual occupancy of a minor child. (d) Include in any rental agreement or lease for a housing accommodation a clause providing that as a condition of continued occupancy, the tenants shall remain childless or shall not bear children or otherwise not maintain a household with a person or persons of a certain age. (e) Threaten to commence or commence eviction proceedings against any tenant on the grounds that he or she has breached a rental agreement if the alleged breach arises out of an increase in the number of occupants due to the marriage of the tenant, provided that the occupancy of the spouse and children of the spouse is otherwise lawful. (f) Threaten to commence or commence eviction proceedings against any tenant head of household on the grounds that he or she has violated the provisions of a rental agreement where the violation consists of an increase in the number of occupants arising out of the birth, adoption, or change of legal custody of a minor child of whom the tenant head of household or his or her spouse is the parent or legal guardian, and provided that the occupancy of said minor child is otherwise lawful. El (g) Refuse to make reasonable accommodations in rules, policies, practices, or services, when such accommodations may be necessary to afford a person with a disability equal opportunity to use and enjoy any dwelling. (h) Refuse to allow a person to make reasonable modifications, alterations or additions to existing premises occupied or to be occupied by a person with a disability that are necessary to make the rental property accessible by persons with disabilities, under the following conditions: (1) The landlord is not required to pay for the alterations, additions, or restoration unless otherwise required by State or Federal law; (2) The landlord has the right to demand assurances that all modifications will be performed in a professional manner, and in accordance with applicable building codes, permitting requirements and other applicable laws; (3) The landlord may, where it is reasonable to do so, condition permission for modification on the tenant's agreement to restore the interior of the premises to its pre- existing condition, reasonable wear and tear excepted. 47 (i) For purposes of this part, "disability". includes, but is not limited to, any physical or mental disability as defined in California Government Code Section 12926. Q) For purposes of this part, "source of income" includes any lawful source of income or rental assistance from any federal State local or non - profit- administered benefit or subsidy program including, but not limited to, the Section 8 voucher program. SECTION 2. Santa Monica Municipal Code Section 4.28.060 is hereby amended to read as follows: 4.28.060 Civil remedyies. II' Z7: 1�7S7n7�1: 7: RTi7: 1fZ�7TS7/. T. ��: L71�: T- T- T. S7( 1T.tT.77- LTS.T.L1:1�SiT.17TlR.L IYi:NC fee &: (a) Civil Action. Any person, including the City, may enforce the provisions of this Chapter by means of a civil action. The burden of proof in such cases shall be preponderance of the evidence. 0 (b) Iniunction. Any person who commits an act, proposes to commit an act, or engages in any pattern and practice which violates Section 4.28 may be enjoined therefrom by anV court of competent jurisdiction. An action for injunction under this subsection may be brought by any aggrieved person, by the City Attorney, or by any person or entity who will fairlV and adequately represent the interest of the protected class. (c) Penalties and Other Monetary Awards. AnV person who violates or aids or incites another person to violate the provisions of this Chapter is liable for each and every such offense for the actual damages suffered by any aggrieved party or for statutory damages between the sum of one thousand dollars and ten thousand dollars, whichever is greater, and shall be liable for such attorneys' fees and costs as may be determined by the court in addition thereto. (e) Nonexclusive Remedies and Penalties. The remedies provided in this Chapter are not exclusive, and nothinq in this Chapter shall preclude any person from seekina anv other remedies. penalties or procedures rovided by law 7 SECTION 3. 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, is hereby repealed or modified to that extent necessary to effect the provisions of this Ordinance. SECTION 4. 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 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 5. 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 become effective 30 days from its adoption. APPROVED AS TO FORM: MARSHA dO ES MOU RIE Cit , ttorrjeyJ n