Pass: 12,061 / 51.57% Yes votes ...... 11,325 / 48.43% No votes

See Also: Index of all Measures

Impartial Analysis from City Attorney

BALLOT MEASURE AMENDING THE CITY CHARTER TO AUTHORIZE THE RENT CONTROL BOARD TO IMPOSE A REGISTRATION FEE OF NO MORE THAN $288 PER CONTROLLED UNIT WITH HALF THE AMOUNT OF THE FEE TO BE PASSED THROUGH BY LANDLORDS TO TENANTS

This measure, placed on the ballot by the City Council, would amend City Charter section 1803(n), governing registration fees for controlled rental housing units. Currently, that section authorizes the Rent Control Board to finance its reasonable and necessary expenses by charging landlords annual registration fees for controlled rental units in amounts the Board deems reasonable. Section 1803(n) also currently authorizes the Rent Control Board to annually establish the portion of the fee that landlords may pass through to tenants. The proposed measure would amend section 1803(n) by establishing an upper limit for the registration fee of $288 per controlled unit and by limiting to 50% the portion of the fee that may be passed through by the landlord.

Existing language in section 1803(n) would continue to preclude the Rent Control Board from charging more than the amount necessary to finance its operations. This means that the Board cannot use the registration fee to generate revenue. It can only set the fee in an amount necessary to fund its costs. So, if the measure passes, the actual fee imposed by the Board in any given year could be significantly less than $288 per unit. But, it could not be more without voter approval.

As to the pass through, the new language limiting it to 50% of the fee would, in effect, preclude the Rent Control Board from establishing a different percentage. Current law allows the Board to authorize landlords to pass through 100% of the registration fee to tenants; and, historically, that is what the Board authorized, until last year when the Board authorized a pass through of about 89% of the registration fee. In contrast, by mandating a 50% pass through, the proposed measure would effectively require that the cost of Rent Control Board operations be equally split between landlords and tenants. The measure also includes language clarifying that the Rent Control Board may establish conditions and procedures governing the pass through.

Because it would clarify the Board's authority and impose specific limits on the exercise of its discretion, the proposed measure could help insulate the Rent Control Board from legal challenges to the registration fee.