move forward. I have been thinking about the appropriate mechanisms for making
these significant legal determinations as a Council, and what are the right bodies for
those determinations. I think that the question of the implied warranty of habitability is
a very serious one with legal ramifications. If we are to make that finding as a Council,
there should be a clear process for how that's established. That is typically
established in housing court or district court, not through a government body at the
elected legislative level. Having us make that finding with the information that we have
feels inappropriate, given the record in front of us and the availability of information.
That can be due to a lack of staffing or funding, and I look forward to using this to
guide us in the future as we look at funding and policy changes around our rent
stabilization policy.
Bowie: The landlord initially proposed a 30% increase, so staff review did result in a
reduction. Our ruling needs to stand up in court. We're not a court. We're not the venue
for defining habitability. I'm hesitant to make a ruling that conditions were not
habitable. I don't think policy not being as strong as we want is a reason to find in
favor of the appellant. The process panned out as it was written. There were not items
standing out as violations. Items 28 - 31 I found differently, but not for Items 26 and
27.
Noecker: I agree with Coleman that we aren't the body to determine the warranty of
habitability. My issue is not that the property is uninhabitable. I don't think we can say
that with any certainty. It is that we have a requirement for certain things to be taken
into account in our ordinance, and that wasn't done.
Johnson: The policy is not in place just to ensure safety, but to also prevent major rent
increases. I don't find solace in the request being 30% initially. I don't think it's the
policy that is the issue. I agree with Noecker. The policy was not followed. It is our duty
to enforce that.
Jost: It's helpful to understand that your comments are not based on the warranty of
habitability. I think the other related part of the ordinance is substantial deterioration .I
didn't find that in the record. That's a very subjective matter. Any information we have
on that would be from DSI and any complaints they've received. I don't think we had
any complaints filed here. If we are going to be making that determination based on
substantial deterioration, we need to think about what type of systematic process we're
going to use to look at these cases in the same way. I did not find any errors from DSI
or Moermond. I want us to be consistent.
Bowie: Part of the appeal is focused on the reasonable rate of return on a landlord's
investment, which is in the ordinance. Property taxes are part of that. The landlord
showed an increase. Unavoidable increases in maintenance costs are part of that. The
landlord showed evidence of that. There have also been more tenants living there,
which increases wear and tear and is built into our ordinance. These rents are below
market rate for this neighborhood. We need to think about the precedent being set
here. This isn't a situation of a landlord trying to jack up the rent.
Yang: What was the increase in property taxes?
Moermond: I don't have that in front of me. It's in the documents attached to the record
as part of the Maintenance of Net Operating Income (MNOI) worksheet. The net total
of all increases taken into account was 28.5%.
Bowie renewed her motion to deny the appeal. Motion failed 3 - 4 (those opposed being
Councilmembers Noecker, Kim, Yang, and Johnson).
Noecker moved to grant the appeal.