City Council Modifications to Tenant Protection Ordinance James Wong, Senior Project Manager March 25, 2019

Recommendation Finding of CEQA exemption under “General Rule”, Section 15061(b)(3) Approve proposed modifications to the Tenant Protection Ordinance as described in the agenda report Direct City Attorney to prepare amendment to TPO per proposed modifications, return within 60 days

Background TPO requires landlords of multifamily rental units to pay relocation benefits under the following situations: 1. Demolition 2. Permanent removal of unit from market (including condo conversion) 3. Occupancy by landlord or landlord’s family member 4. Government order to vacate

Background 5. Tenants evicted from educational institution-owned housing Tenant’s status as student, faculty or staff was discontinued for 365+ days prior to eviction notice In good-standing and income-eligible

Background Income-Eligibility for TPO benefits: 140% or less of median income Household Size Median Income 140% Median Limit 1 $48,500 $67,900 2 $55,450 $77,360 3 $62,350 $87,290 4 $69,300 $97,020 5 $74,850 $104,790

Background TPO Relocation Allowance: TPO Moving Expense allowance: $1,306 for adult household $3,935 for household w/ dependents, seniors, disabled persons Unit Size HUD FMR RELO Allow (FMR x 2) Studio $1,067 $2,134 1-BR $1,284 $2,568 2-BR $1,663 $3,326 3-BR $2,231 $4,462 4-BR $2,467 $4,934

Background At regular Council meeting of 10/22/18 staff presented potential modifications to expand TPO Council directed staff to return with specific recommendations on greater protections for tenants under TPO Staff directed not to consider rent control or just cause eviction policies

Background Housing Dept. convened meetings w/ landlord and tenant advocates on 11/29/18 and 2/8/19 to solicit input on TPO modifications Landlord groups: Apartments Assn of Greater LA, Foothill Apartment Assn, Pasadena-Foothill Assn REALTORS Tenant groups: Pasadena Tenants Union, Greater Pasadena Area Affordable Housing Group, Pasadenans Organizing for Progress

TPO Modification #1 Change in Property Ownership Tenant displaced in connection w/ change in property ownership. Notice of large rent increase, lease termination, or eviction is issued to tenant within 2 years after change in ownership. “Large rent increase” if % increase exceeds CPI + 5%

TPO Modification #2 Relocation Allowance Amount Increase TPO Relocation Allowance formula to 2.5 x HUD Fair Market Rent; currently 2.0 x HUD FMR Intent is to recognize that current market rents in Pasadena have exceeded HUD FMRs

TPO Modification #3 Longer-Duration Tenancy Tenancy of at least 10 years qualifies tenant to receive more than the base amount of TPO Relocation Allowance Each add’l year after the min. 10 years qualifies tenant to a 10% increase on the TPO Relocation Allowance base amount. Max. TPO Relocation Allowance is 200%

TPO Modifications Housing Dept. sent proposed draft modifications to landlord and tenant groups on 2/26/19 for feedback Comments received during 3/5-6/19 Comments summarized in Attachment to agenda report. Some of the comments were incorporated into the staff recommended Modifications.

TPO Modifications End of presentation

TPO Cases FY 2019 TPO Cases FY 2019: 7 tenant cases processed $47,471 avg income TPO-eligible tenants $3,652 avg TPO benefit amount 4 properties in progress

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