EBRHA AT WORK

A MESSAGE TO CITY COUNCIL FROM WAYNE ROLAND

Wayne Rowland

Despite numerous outreach attempts by EBHRA, only two Oakland Councilmembers (Kalb and Taylor) made attempts to reach out to EBRHA to discuss the impact of Councilmember Fife’s propose cut of the city’s allowable 6.7% increase. Council passed the ordinance May 31, 2022 to permanently cut the formula (60% of CPI) and cap it at 3% by a vote of 6-2.

Wayne Rowland, EBRHA Board President, delivered a strong message to City Council on behalf of rental property owners.

On average, rents in Oakland have been declining steadily since 2016, but rental operating costs have been rising significantly due to much higher inflation the last 12 months. [Source: Zumper]

May 24, 2022

Honorable Councilmembers:

I am writing to express my opposition to the recent proposal by Councilmember Carroll Fife to change how Oakland’s annual rent adjustment is calculated. The cpi adjustment as it is currently calculated is the longstanding result of collaboration and agreement among tenants, housing providers and the City of Oakland. It should not be lightly dismissed because of the result of a single year’s rate of inflation.

In 2001 Oakland’s City Council convened a committee of stakeholders to address what it felt were needed changes to its then Rent Arbitration Program. The arbitration program, which began in 1980 by capping rent increases at 10%, was Oakland’s response to the double-digit inflation of the day, which peaked at 13.55% that year.

The committee, which met frequently, consisted of representatives of tenant advocacy groups, rental housing providers and members of Oakland’s City Council. At the conclusion of its work, most if not all the recommendations made by the committee were adopted into law by the Oakland City Council and remain to this day as bedrock provisions of Oakland’s Rent Adjustment Program. The cpi adjustment is one of those provisions.

Prior to the current cpi adjustment, the rate of increase was set annually by the City Council in a raucous, highly politically charged annual public meeting. A process that all stakeholders agreed needed to change. The cpi adjustment, which took politics out of the process, is the result of that agreement.

Councilmember Fife’s proposal, which would reintroduce politics back into the equation, could not come at a worse time for Oakland housing providers. Through the Council’s own actions, many have not received rent on fully occupied units for more than two years. Under the misnomer of an “eviction moratorium,” a “Rent Payment Moratorium,” allowing any renter, whether impacted or not by the COVID-19 pandemic, to without explanation stop paying rent, remains the Council’s main policy response to the pandemic.

Meanwhile, all the costs of providing housing, i.e., water, sewer, gas, electric, garbage, insurance, repair services, and other fees, are rising in double digits. Even the existing cpi increase begins to look like thin gruel for housing providers trying to keep up and remain viable in Oakland.

The current proposal before the Council to reduce the adjustment to below the cpi is a bad idea. It not only reinjects politics into the process, but it also undercuts years of precedent that has created stability and predictability in the annual adjustment process. Precedent matters.

At a time when the Council has just rewarded itself a generous 6.3% pay raise, this is no time to break long-standing precedent and reinject politics into the annual adjustment. Doing so would be unjust and further deny Oakland’s rental housing providers the financial lifeline they need to continue in the essential business of serving the City’s housing needs.

I urge the Council to reject the proposal currently before them.

Sincerely,

Wayne C. Rowland