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RSO & Relocation. December 2008. What Does Rent Stabilization Do?. Controls rents (Vacancy decontrol) Limits evictions (12 Legal Reasons) Requires relocation assistance for no-fault evictions. Subject Properties. Basic Rule Housing accommodation rented or offered for rent

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rso relocation

RSO & Relocation

December 2008

what does rent stabilization do
What Does Rent Stabilization Do?
  • Controls rents (Vacancy decontrol)
  • Limits evictions (12 Legal Reasons)
    • Requires relocation assistance for no-fault evictions
subject properties
Subject Properties
  • Basic Rule
    • Housing accommodation rented or offered for rent
    • In the City of LA
    • C of O on/before 10/1/78
    • 2 or more on a lot
  • Inventory
    • Over 129,000 properties
    • Approximately 636,000 rental units
    • Includes condos, co-ops, rooming houses, mobile home parks*, hotels & motels
not covered
Not Covered
  • Single one-family dwelling on a lot
  • Units built after October 1, 1978
  • Non-profit units approved by LAHD
  • Luxury Units approved by RSO
  • Hotel & motel rooms, occupied less than 30 days
  • Rental units in converted commercial buildings (adaptive re-use projects w/1st rental use after 10/1/78)

(Full list in LAMC 151.02 “Rental Units”)

when rent is not controlled
When Rent $ is Not Controlled:
  • Properties not subject to the RSO
  • “Vacancy Decontrol”
    • Units Voluntarily Vacated
    • Initial Rentals Following Certain evictions
      • Non-payment
      • Lease violation
      • Compliance with City Attorney order
      • Failure to relocate
  • Condos *
    • Still subject to rent registration and eviction controls
    • Pre-1996 tenants protected by full rent control
allowable rent increases 2 kinds 1 lahd approval not required
Allowable Rent Increases(2 Kinds)1) LAHD Approval Not Required
  • Vacancy Decontrol – set to market upon re-rental after voluntary vacancy
  • Annual Automatic Rent Increase
    • 3% - 8% per RSO
    • 3% as of 7/1/2008
    • Additional 1% each for gas & electric if owner-paid
  • Increases for additional tenants
    • 10% for each additional tenant
    • Does not include 1st minor dependent child
allowable rent increases 2 need city approval
Allowable Rent Increases2)Need City Approval
  • Individual Adjustments
    • Capital Improvements – improvements or replacements in rental units or common areas
    • Primary Renovation – major upgrades/renovation
    • Just & Reasonable – Review based on landlord’s NOI
  • Approved through administrative review process, appealable to a Hearing Officer
eviction grounds
Tenant at fault

Non-payment of rent

Lease violation (but not for unilateral change in terms)

Nuisance (garden variety, drugs & gangs*)

Illegal purpose*

Failure to renew lease

Denial of reasonable access

Unapproved subtenant

Failure to relocate per Tenant Habitability Plan*

No-fault

Owner/manager occupancy*

Ellis (demo & withdrawal)*

Government order*

HUD foreclosure*

Eviction Grounds

* Landlord declaration required

rso changes in ownership
RSO & Changes in Ownership
  • Sale or foreclosure is not a legal reason for eviction!
  • Also not a basis for a rent increase.
  • A change in ownership does not change the terms of the tenancy under the RSO.
  • Lender who forecloses assumes the role of the landlord.
eviction requirements
Eviction Requirements
  • Eviction notice
    • Reason given to tenant
    • 60 days as of January 1, 2007 for tenancies of at least 1 year (no-fault evictions)
    • Extended notice for Ellis
      • 120 days minimum
      • Seniors/disabled up to 1 year
  • Landlord declarations
    • Filed with LAHD
relocation requirements landlord responsibilities
Relocation Requirements – Landlord Responsibilities
  • Landlord must provide relocation assistance in following evictions:
    • RSO units
      • Owner occupancy
      • Ellis eviction
      • Compliance with government order
      • HUD foreclosure
      • Permanent relocation in approved Tenant Habitability Plan
    • Condo Conversions
    • Demolitions
    • Mobilehome park closures
new relocation amounts
New Relocation Amounts

As of July 1, 2008:

relocation process
Relocation Process
  • For RSO units, file Landlord Declaration of Intent to Evict
  • File with LAHD Relocation Contractor Services Application
  • Pay required LAHD Relocation Contractor fees
  • Pay required administrative fees to LAHD
  • Pay relocation to tenants

LAMC 151.09.G (RSO) / LAMC 47.06 (Condo-Conversions) / LAMC 47.07 (Demolitions)

relocation contractor
Relocation Contractor
  • LAHD refers property to Relocation Contractor (Paragon Partners)
  • Paragon meets with tenants
  • Based upon Tenant Assessment Form completed by tenant, Paragon completes Relocation Determination Form. Copy provided to tenant, owner, LAHD.
  • Paragon provides tenants with counseling, referrals, listings, additional services for disabled and elderly.
payment of relocation fee
Payment of Relocation Fee
  • Payment required within 15 days of serving 120 day notice (RSO) or 60 day notice (non-RSO) on tenants.
  • Or within 15 days of tenant’s request for relocation after Planning’s approval of tentative tract / parcel map.
  • May deposit relocation payments in escrow accounts instead (RAC Regulation 960.00)
  • If tenant claims higher relocation based on low income status, owner may request LAHD hearing if disputes basis.
failure to pay relocation
Failure to Pay Relocation
  • Tenant may file a complaint with LAHD. LAHD will investigate, issue determination, refer non-compliance to City Attorney for prosecution.
  • Failure to pay correct relocation amount is also a defense to an eviction in Superior Court.
  • LAHD will not clear demolition permits until owner proves payment of relocation.
ellis act restrictions new construction
Ellis Act Restrictions New Construction
  • After Ellis eviction, if demolished RSO building is replaced w/newly constructed rental units, the new units are subject to the RSO if rented within 5 years of the filing of the Ellis Landlord Declaration with LAHD (LAMC 151.28)
  • The initial rent = unrestricted.
ellis act restrictions new construction exemptions
Ellis Act Restrictions - New Construction Exemptions
  • Exemption for rental units constructed after Ellis eviction (demolition):
    • Owner does a one for one replacement of each demolished RSO units with an affordable housing unit, capped at 20% of total number of newly constructed rental units.
    • Building of 4 units or less was owner occupied for 3 years prior to its demolition.
restrictions on re rental of ellised units
Restrictions on Re-Rental of Ellised Units
  • If unit re-rented unit within 2 years of removal from rental market (tenant’s surrender of premises), owner is liable to tenant for actual and exemplary damages. City may also sue him.
  • If re-rented within 5 years of filing of Ellis Dec, must be rented at old rent plus allowable RSO increases & tenant has right of 1st refusal if tenant requested.
relocation assistance
No-fault

Owner/manager occupancy*

Ellis (demo & withdrawal)*

Government order*

HUD foreclosure*

Permanent Relocation per approved THP

Payment within 15 days of notice

Direct payment

Escrow account

7/1/08 – 6/30/09

$9,300 or $17,600 seniors, disabled, families

$7,000 - $9,300 everybody else

(per household)

$ Relocation Assistance