Rent Control Board to Consider Whether a Rental Unit May be Removed from Rent Control

At its Thursday night meeting, the Santa Monica Rent Control Board will consider the removal of a rent controlled unit from the rental market. A recent California Court of Appeal decision seems to say that when the RCB grants permission for a landlord to remove a unit from the rental market, they are in fact removing rent control itself from that property.

"This item was initiated by the Board's General Counsel in response to the Court of Appeal's July 30 opinion in 1041 20th Street, LLC v. Santa Monica Rent Control Board. In 1041 20th Street, LLC, the Court of Appeal held that the Board was correct when it determined in a 2016 administrative decision that a removal permit does nothing more that permit an owner to take a controlled unit off the market. . ." The intention of the proposed rule change, is to clarify that a removal permit does not remove the subject property from rent control.

Staff continues:"The third and final of the proposed regulations, Regulation 5102, specifies the period during which a removal permit must be acted on, without which such action the permit will expire. The litigation revealed there are some units or properties,-most notably 1041 20th Street, which was the subject of the litigation-as to which a removal permit was granted based on facts that are demonstrably no longer true. 2 As to those properties, which do not qualify for a removal permit, it makes no sense to permit the owner to act on a long-ago- issued permit to remove units from the market merely because they could have been removed years ago. But, in the absence of a specified expiration date, city- issued permits do not expire. Thus, there are property owners who clearly, and in some cases admittedly, could not qualify for a removal permit today who could nonetheless remove a unit or units from the market based upon a permit whose appropriateness has long since passed."