As residents of downtown's historic President Hotel brace for eviction, Palo Alto's elected officials are preparing new measures that would assist local renters at a time of escalating rents.
The new proposals will likely come too late to help the residents of the Birge Clark-designed building at 488 University Ave., who were ordered by the building's new owner, AJ Capital, to vacate their apartments by Nov. 12. But if adopted, the ordinances could offer some relief to renters who find themselves facing a similar plight in the future.
A proposal that Councilman Cory Wolbach told the Weekly he would like to see is a focus on greater "displacement protection" for residents facing steep rent increases. New rules would require property owners to provide relocation assistance to evicted residents — a provision similar to the one the city has for mobile home parks, Wolbach told the Weekly.
He also said the city could consider more diligently enforcing its requirement for one-year leases, a rule that he said is not often followed. In cases of "exorbitant rent increases" or evictions without just cause, the council could require more extensive relocation assistance, he said. This, he said, is different from "traditional rent control," in which rent increases beyond a certain threshold are prohibited by law.
"The idea is that there would be a financial disincentive against exorbitant rent increases," Wolbach said. "If the landlord decided to pursue an exorbitant rent increase, they would have to provide relocation assistance of substantial amount."
The approach is a marked departure from the proposal the council considered — and rejected — last October, when council members Tom DuBois, Karen Holman and Lydia Kou suggested exploring renter-protection measures. A memo from the trio focused on limits to rent increases and rules for protecting tenants from evictions without just cause.
Palo Alto's rent has soared by 50 percent since 2011, the council members stated in their memo, a rate that they said is unsustainable given that the median income in Santa Clara County has risen at less than one-tenth of that rate.
While the growth in the regional tech economy has been a "boon to many," the memo states, "that growth has been accompanied by negative disruptions, including a steep increase in demand (for housing) that has severely degraded our housing affordability and resulted in many long-term renters being forced out or having to spend inordinate amounts of their incomes on housing."
The idea of exploring rental protections did not advance, with some council members framing it as "rent control," a characterization that DuBois disputed. Wolbach was among those who voted against the memo. Though he said that he generally favors the thrust of the memo, he questioned the sincerity of DuBois, Holman and Kou (all of whom favor slower city growth) and said he opposed the proposed process for exploring the topic, which did not include reviews by the council's advisory commissions. At the council's February retreat, Wolbach proposed including rental protection as a potential priority for 2018, though that idea did not win support from his colleagues. Now, he believes it's time to revisit the idea.
"We had a couple of false attempts," Wolbach told the Weekly this week. "I think that now, there is a lot of attention in the community and on the staff and council about why we need to have these conversations."
DuBois, who like Wolbach and Vice Mayor Eric Filseth is running for re-election in November, said he still hopes the council will consider some proposals from the memo. One other possibility, he said, is to provide legal assistance for residents facing eviction, a program that San Francisco voters approved in June when they passed Measure F.
DuBois also said that he favors exploring policies that, while not actually freezing rents, would limit how much they can be raised.
"I do think some caps on the amount of rent increases would be something that we should consider," DuBois told the Weekly. "Saying that a landlord can't raise rent by 50 percent in a year — I'd say that's not rent control. It's just limiting how quickly you can change it."
DuBois also expressed frustrations that Wolbach voted against exploring renter-protection policies just a few months ago but is now raising the issue.
"It's unfortunate, particularly because of the (President Hotel) situation, that we weren't having that discussion already," DuBois said.
DuBois wrote on the Palo Alto Weekly online forum, Town Square, that he would welcome Wolbach to work with him on renter protections, an issue that he wrote is "too important to make it a political football to be supported only when your 'team' agrees with you."
"I listen and vote based on the quality of a proposal before us on council and am happy to collaborate with any of my colleagues," DuBois wrote Wednesday.
That collaboration became a reality on Thursday, when Wolbach joined DuBois, Holman and Kou in submitting a new version on renter protections.
While the new memo borrows heavily from the prior proposal when it lays out the problem, it has a few significant differences: it no longer calls for rent-stabilization measures.
It does, however, call for stronger enforcement of the city's requirement for annual leases and "reasonable eviction mitigations such as relocation provisions for tenants facing displacement.
In the long-term, the memo states, the council should review the city's renter-ordinances, as well as those in other Bay Area cities, consider "reasonable relocation assistance" to be provided to tenants with five or more units; and consider other updates to existing laws.
"Neighboring communities have recognized that the issue has reached a near crisis level and are considering similar measures," the memo states. "Current and future economic forces have made additional renter protections necessary for well-being of our community, its valuable diversity, and a viable economy."
While council members consider new laws, residents of President Hotel are looking for new homes. On July 20, they received what initially appeared to be hopeful news: Palo Alto's city planners had determined that AJ Capital cannot proceed with its plan to convert the building to a hotel because of the zoning code, which — while allowing renovations of grandfathered buildings (those that went up before the zoning code was written) — specifies that these buildings would need to retain "the same use" (in this case, residential). Though the city's determination has placed AJ Capital's plan in jeopardy, some residents have already "cut their losses and left," resident Pemo Theodore told the Weekly.
It is very sad, she added, to go to the mail room and see their names removed.
"It has been a huge cost to all of us and we still do not know what the future holds for The President Hotel and our apartments," Theodore told the Weekly in a July 20 email.
On Monday, the company confirmed that despite the city's determination — which it is disputing — residents are still required to move out by Nov. 12.
"We did not want there to be any confusion due to questions raised in recent articles as to what, if any, effect our discussions with the City have on the time you have remaining in the building," Timothy Franzen, president of AJ Capital, wrote in the letter. "You should continue with your efforts to find new housing, and we encourage you to take advantage of the expert relocation-services firm that we have engaged to assist in your efforts."
Franzen wrote that the company "fully appreciate(s) the burdens and difficulties of finding and moving to new homes, which is why we have offered the additional time and financial support."
A group of tenants attended the meeting of the Planning and Transportation Commission on Wednesday night to thank city officials for their efforts to preserve the President Hotel as housing. Diane Boxill, a piano teacher who has lived in the building for 30 years, said it will take continued participation from the city to protect residents from the "massive monolith that can dispense with us in its wake."
"The (President Hotel) community is diverse in age, ethnicity and professions but united in a kind of neighborliness that is fast becoming a memory of the past," Boxill said.
Though the commission was not scheduled to discuss the President Hotel, several members acknowledged that the topic of renter protections is becoming increasingly urgent and indicated that they are eager to tackle it. Commissioner Asher Waldfogel asked the city's legal counsel what tools the commission has to address rent protection, evictions and rent increases.
"We heard clearly that these are issues," Waldfogel said. "What can we do?"