Renters need anti-gouging law for California’s housing emergency

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Over the last few years, California has suffered through a series of devastating fires. In the wake of the fires, an already overpriced housing market has reeled from the massive loss of housing stock. One need look no further than the town of Paradise, which virtually disappeared from the map a year ago after being in the direct path of the Carr Fire. As hundreds of units were lost over the course of several fateful days, the already tight and expensive housing market was further aggravated by the drop in the number of available units that those displaced can afford. Amid this situation, one of the worst possible instances of predatory profiteering has been committed by unscrupulous landlords who took advantage of the situation — and the lack of rent stabilization policies throughout a large part of Northern California — by ratcheting up rents to levels that were not sustainable for the majority of working-class families.

In the wake of wildfires, California Gov. Gavin Newsom declared a state of emergency on Oct. 27, which triggered certain tenant protections under California’s existing anti-price gouging law. In particular, the law prohibits businesses from raising prices of various goods and services, including rental housing, by more than 10%, with limited exceptions. This 10% limit on price increases is a total cap following a state of emergency, and not an annual cap.

The relief for prospective tenants is commonly referred to as “vacancy control.” Landlords cannot charge a prospective tenant more than 10% above what was charged to the last tenant who was living in the unit when the emergency was declared. This is the kind of vacancy control that Berkeley had until 1995 when the Costa-Hawkins Rental Housing Act went into effect and set limits on what kind of rent control policies cities could have. In 2018, lawmakers passed AB 1919, which amended the price gouging law to include vacancy control.

In communities like Berkeley, where nearly half of the tenant population is composed of students, this vacancy control during a state of emergency brings huge relief because students move out of their housing quite frequently. Thus, in the absence of this vacancy control, the prices of units traditionally rented by students are repeatedly set to whatever the market will bear, which is out of reach for many students.

In addition, after the proclamation of a state of emergency, it is illegal for a landlord to evict tenants and immediately rerent the vacated unit to another person at a rental price higher than the evicted tenant could have been charged. Notably, the protections under the state’s price gouging law apply to all rental housing, including residence halls owned by UC Berkeley and other state universities, and not just housing protected under local governments’ rent control ordinances. Berkeley’s and other local governments’ rent control ordinances remain in effect during the state of emergency and tenants are entitled to protections under whichever law is stronger in their particular situation. Nearly 20,000 units of housing in Berkeley do fall under the stronger, Berkeley-specific protections of being subject to an annual allowable increase of no more than 65% of the increase in the consumer price index — historically a 2%-3% annual increase in the rent ceiling — but this increase is reset to market rate when a sitting tenant moves out of the unit.

Landlords and others who violate the anti-gouging law are guilty of a criminal offense, which can result in one-year imprisonment in county jail and/or a fine of up to $10,000. Violators are also subject to civil enforcement actions including civil penalties of up to $5,000 per violation, injunctive relief and mandatory restitution. Berkeley tenants who believe their landlord is violating the law should contact the Berkeley Tenants Union at [email protected] or 510-982-6696. For tenants outside of Berkeley, the statewide organization Tenants Together is an excellent source of information and can be reached at 888-495-8020.

We heartily concur with the statement made by Berkeley Tenants Union chair Julia Cato: “Tenants all over the state already suffer from exorbitantly high rents caused by a failure to fund affordable housing and state law prevents cities and counties like Berkeley from implementing real rent control ordinances such as vacancy control. These fires make the situation unbelievably worse, and the governor needs to keep these specific tenant protections in place as long as possible.”

The time in which we find ourselves today — one of extreme housing emergency aggravated by the loss of thousands of housing units due to wildfires and other disasters — is a particularly critical one to broadly publicize this declaration and petition the governor to extend it beyond the nominal sunset date of Dec. 31. The law is not as strong as Berkeley’s rent control law was prior to 1995, nor even the protections extended to sitting tenants of rent-controlled units in Berkeley. Nevertheless, it is an important step forward toward a community that we can all call home.

Paola Laverde is the chair of the Berkeley Rent Stabilization Board. Leah Simon-Weisberg is the vice chair of the Rent Stabilization Board. Igor Tregub is a Rent Stabilization Board commissioner.