Blogging Bayport Alameda

August 24, 2015

Blast from the past: rent control

Filed under: Alameda — Lauren Do @ 6:04 am

Earlier this year I was able to convince my kids to hang out at the library with me so I could do some microfiching while they browsed the kid section.  Suffice it to say it was a one time deal and I haven’t been able to make it back into the microfiche archives for a while.  But during the power 30 minutes they gave me way back in February or something, I was able to find a few interesting things.  First on rent control.

I would scan these articles but my scanner is on the fritz and you don’t really want me to take photos and post those right?  Because that would be totally janky.

Anyway, in 1985 some Alamedans tried to get rent control passed in Alameda but fell short because of procedure issues.  According to an article in the Alameda Times-Star on March 26, 1985 a group by the name of Tenants and Landlords for Fair Rent managed to collect 6346 signatures to place a measure on the ballot.  However, the petition was invalidated, highlights:

City Clerk Diane Felsch spotted what she believed to be a major problem after the petitions were turned in, and City Attorney Carter Stroud confirmed her doubts.

According to Stroud, the Secretary of State holds that a petition which does not contained the required text is not a valid petition.  None of the petitions turned in by the organization had the 10-page text attached, Stroud said, and there are no staple holes to indicate that the text had ever been attached.

And

A number of residents reportedly told Stroud that the individuals circulating the petition refused to provide copies of the text when asked.  They claimed that mimeographed summaries of the content of the proposal were offered instead.

But John Doherty, organizer of Tenants and Landlords for Fair Rent, maintains that everyone who circulated petitions was given a copy of the entire text.  They were told to have the text available when they circulated the documents, he added.

“The text and the whole ordinance were available to everyone, ” Doherty said “Any time anyone asked me to see the text, I showed it to them.  I just can’t understand where they’re getting it from that people wee refused to see the ordinance.”

According to this article here’s what the rent control ordinance would have done had this gone to a vote and been passed in the mid-1980s:

  • Annual rent hikes limited to 75% of previous calendar year’s increase in regional Consumer Price Index
  • No rent increases for a year after the property is sold
  • Only 13 specific reasons that would allow for an eviction
  • Landlord responsibility for informing tenants of the law and providing detailed information about rent raises
  • Landlord would have to supply names to tenants of all of tenants receiving rent raise as well as information about the Rent Review Advisory Committee

Based on further searching it appears that the committee decided to not pursue a legal challenge to the invalidation and decided to not reattempt the signature gathering process.

Interestingly enough if this is the same John Doherty referenced above, shortly after the invalidation of this process a John Doherty in Alameda started having lots of problem with his building at 1617 Central in July of 1985 with building inspections.

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35 Comments

  1. I thought they were rehabbing 1617 Central and 500 Central…did they run out of money?

    In my opinion, rent control has the opposite effect the desired outcome. It limits the amount of rentals because people in those rent control buildings stay there forever and limits the supply for others who want to rent…thus creating higher rents in non rent controlled buildings. My old roommate stayed in his rent controlled apartment for 15 years because he had such a great deal, but the landlord did nothing but the minimum to maintain the building. He could have bought a place probably after his first couple of years in San Francisco, but the rent was so low, he stayed. He did finally buy a place and move and the landlord raised the rent from $1,500 for a 3 bedroom to $5,000 after he left. Since then you drive past the building it has new windows, has been painted, the area around it has been cleaned up. It seems like the cities with the most expensive rents in the country have rent control.

    Comment by Jake. — August 24, 2015 @ 8:10 am

  2. Jake, rent control is a symptom of high rents, not the cause. Strict rent control can exacerbate an existing problem though.

    At the time the 80s petition was circulated you were at the tail end of a decade where CPI was like 8-15% at times. A far cry from the 2% or so we’ve seen in recent decades. A modest rent stabilization ordinance in Alameda could remove the worst of the rapid rises and uncertainty in the boom years, without causing stock to be essentially removed from the supply and removing the incentive to maintain properties. Something like just cause eviction and CPI+3% w/ an absolute cap of 10% during higher inflation periods would allow a reasonable return on the investment but allow some predictability for renters, some who currently fear 60 day notices or 25-50% increases when a new corporate overlord takes control.

    Comment by BMac — August 24, 2015 @ 10:48 am

  3. If John and or his niece, Dee Doherty, had anything to do with this I am for certain sure that the petition was suspect legally.

    Comment by Futbol Fan — August 24, 2015 @ 11:00 am

  4. Not sure where Jake is getting his info but a whole lot of people can attest to the fact that these giant rent increases do not lead to betterment of the properties or are caused by them – why should they- Alameda has absolutely no controls. Used to rent for 1500- now rents for 3000 and all they do is paint (sometimes)- often not. People desperate to keep their kids in school here are being thrown out after being part of the community for years – so that people desperate to find a place can get in- seriously a lot of these properties are holes and since the council does not care – it just keeps getting worse. The horror stories on the ARC tell the truth- mold, crappy plumbing, lousy carpet, rip offs of every kind, tenants being lied to, tenants doing the work themselves and then being thrown out so the landlord can reap the benefits, stolen deposits, get thrown out with no where to go or even a choice (even if they could afford to stay). People complain that Alameda is changing- this is why- 53% of the population living in fear. And these are not the dreaded “low income” folks, these are solid, committed, long term citizens making decent or better than decent money who still can’t survive here anymore. The council fiddles while Alameda burns-

    Comment by librarycat — August 24, 2015 @ 12:02 pm

  5. Limit rent hikes to 75% of CPI increase? In other words, a landlord would receive 25% LESS than general inflationary increases. Sounds like a TERRIBLE DEAL for anyone who owns property.

    Comment by Massive Johnson — August 24, 2015 @ 1:54 pm

  6. Tie all Rent Increases into the Same % Rate Increases of Building Fees , Permit Fees, Taxes, Transfer Fees and Selling Price of Housing.

    I wonder what these Fees, Building Permits, Taxes , Transfer fees, were in 1985 show and where there are now. Speaking of Fair Fee Increases to homeowners and Landlords.

    Haven’t all these Fees, Building Permits, Taxes , Transfer fees been large factor in Rent Increases since 1985?

    Comment by Cobalt Black Keys Johnson — August 24, 2015 @ 2:00 pm

  7. Tie all Rent Increases into the Same % Rate Increases of Building Fees , Permit Fees, Taxes, Transfer Fees and Selling Price of Housing.

    I wonder what these Fees, Permits, Taxes , Transfer fees, were in 1985 show and where there are now. Speaking of Fair Fee Increases to homeowners and Landlords.

    Haven’t all these Fees, Building Permits, Taxes , Transfer fees been large factor in Rent Increases since 1985?

    Comment by Cobalt Black Keys Johnson — August 24, 2015 @ 2:01 pm

  8. The Chapwood Index reflects the true cost-of-living increase in America. Updated and released twice a year, it reports the unadjusted actual cost and price fluctuation of the top 500 items on which Americans spend their after-tax dollars in the 50 largest cities in the nation.

    Oakland- Ca

    2011 Real Inflation 12.3%
    2012 Real Inflation 13.3%
    2013 Real Inflation 13.4%
    2014 Real Inflation 12.2%

    It exposes why middle-class Americans — salaried workers who are given routine pay hikes and retirees who depend on annual increases in their corporate pension and Social Security payments — can’t maintain their standard of living. Plainly and simply, the Index shows that their income can’t keep up with their expenses, and it explains why they increasingly have to turn to the government for entitlements to bail them out.

    It’s because salary and benefit increases are pegged to the Consumer Price Index (CPI), which for more than a century has purported to reflect the fluctuation in prices for a typical “basket of goods” in American cities — but which actually hasn’t done that for more than 30 years.

    The middle class has seen its purchasing power decline dramatically in the last three decades, forcing more and more people to seek entitlements when their savings are gone. And as long as pay raises and benefit increases are tied to a false CPI, this trend will continue.

    So, wherever you live, you showed a higher income. But at the end of the year, you spent all of it — and more.

    http://www.chapwoodindex.com/

    Comment by Cobalt Black Keys Johnson — August 24, 2015 @ 2:17 pm

  9. The myth that the CPI represents the increase in our cost of living is why the Chapwood Index was created. What differentiates it from the CPI is simple, but critically important. The Chapwood Index:
    Reports the actual price increase of the 500 items on which most Americans spend their after-tax money. No gimmicks, no alterations, no seasonal adjustments; just real prices.
    Shines a spotlight on the inaccuracy of the CPI, which is destroying the economic and emotional fiber of our country.
    Shows how our dependence on the CPI is killing our middle class and why citizens increasingly are depending upon government entitlement programs to bail them out.
    Claims to persuade Americans to become better-educated consumers and to take control of their spending habits and personal finances.
    The inaccuracy of the CPI began in 1983, during a time of rampant inflation, when the U.S. Bureau of Labor Statistics began to cook the books on its calculation in order to curb the increase in Social Security and federal pension payments.

    But the change affected more than entitlements. Because increases in corporate salaries and retirement benefits have traditionally been tied to the CPI, the change affected everything. And now, 30 years later, everyone knows the long-term results. Ask anyone who relies on a salary or Social Security or a pension and he’ll tell you his annual increase in income doesn’t come close to his increase in expenses. What comes in is less than what goes out — a situation that spells disaster for average Americans.
    “The data solidly supports what many Americans have suspected for years,” says the Chapwood Index’s founder, Ed Butowsky. “The CPI no longer measures the true increase required to maintain a constant standard of living. This is the main reason that more people are falling behind financially, and why more Americans rely on government entitlement programs.”
    Butowsky began calculating the Chapwood Index in 2008. Using social media, he surveyed his friends across the country to determine what they bought with their after-tax income. He narrowed the list down to the most frequent 500 items and asked his friends in America’s 50 largest cities to check the prices on those items periodically. The Index shows the fluctuation in each city in the cost of items such as:
    Starbucks coffee, Advil, insurance, gasoline, sales and income taxes, tolls, fast food restaurants, toothpaste, oil changes, car washes, pizza, cable TV and Internet service, cellphone service, dry cleaning, movie tickets, cosmetics, gym memberships, home repairs, piano lessons, laundry detergent, light bulbs, school supplies, parking meters, pet food, underwear and People magazine.

    The Index forces middle-class Americans to recognize that their dependence on income increases pegged to the much-lower CPI virtually guarantees that they will run out of money before they die, because people are living longer and there is a huge difference between the CPI and the real world.

    Comment by Cobalt Black Keys Johnson — August 24, 2015 @ 2:22 pm

  10. So are people aware of which house 1617 Central is? It was carved up into 10 Units with partitions. It is a major restoration at this point in time. Someone from Oakland purchased it in 2013 with hopes of restoring it but discovered that it was actually only a Duplex. However she then resold it for a hefty profit.
    http://thealamedan.org/tags/1617-central-avenue

    http://www.zillow.com/homedetails/1617-Central-Ave-Alameda-CA-94501/24861553_zpid/

    Comment by frank m — August 24, 2015 @ 2:23 pm

  11. I would presume it was the John Doherty that was involved with HOPE back in those days.

    Comment by Al P — August 24, 2015 @ 2:38 pm

  12. Frank M how much did the City Collect in Transfer Tax from those two sells on 1617 Central ?

    Comment by Cobalt Black Keys Johnson — August 24, 2015 @ 3:03 pm

  13. How much was Property Tax increased from those two sells on 1617 ?

    Comment by Cobalt Black Keys Johnson — August 24, 2015 @ 3:05 pm

  14. The same as any other Transaction where Real Estate is sold. All I am saying is that you just can’t go carving up houses without the proper permits. When I purchased my house in the late ’70’s this was a big selling point with the local Realtors. It was a mess. You think units are substandard now you should have seen them then.

    Comment by frank m — August 24, 2015 @ 3:29 pm

  15. 6 (& 7): “Haven’t all these Fees, Building Permits, Taxes , Transfer fees been large factor in Rent Increases since 1985?” No.

    8 (& 9): Not all consumers face the same inflation rate, needless to say, but the CPI is a pretty representative good measure. From the little information on the methodology given on their web site, this Chapwood outfit seems to neglect proper sampling, adjustments for quality (a cell phone from 10 years ago provides less than one today) and other basic aspects of index-construction. The idea that CPI is understating the inflation rate consumers face is at best a canard and at worst the product of the small minds of conspiracy-theorists.

    Comment by BC — August 24, 2015 @ 4:14 pm

  16. that East Bay Express article about 1617 Central that Lauren links to is very illuminating. The house has 12 bedrooms + 10 baths = 9000 sq ft–and the CITY-not the owners-is still calling it a Duplex??? Must be the biggest duplex in Alameda.

    From the text of the article, it seems the City should have realized it is not really a duplex, long ago…Calling it a duplex is not going to get it occupied by 2 happy families.

    Comment by vigi — August 24, 2015 @ 4:16 pm

  17. Supporting rent control is de facto support for existing tenants at the expense of people who want to move to Alameda and rent in the future.

    [the same effect that Prop 13 has on home ownership, though statewide]

    All the locals who elevate the concept of Alameda Nativism above all else should love it.

    Comment by Brock — August 24, 2015 @ 4:45 pm

  18. 15)

    The Chapwood Index was given to me by a financial analyst who works for one of the Largest Insurance and Financial Companies In the World and they manage 100’s of billions of Assets for Pension Funds, Corporations, and Individuals.

    They have to live in the real world when figuring costs of Insurance and Real Inflation and how they need to price their product and services and replacement costs in the event of a claim.

    Regarding Fees, Building Permits, Taxes , Transfer fees been large factor in Rent Increases since 1985?”

    I have copies of Building permits from a room addition that was done in 1983 and the permit fees, plan fees, Electrical fees, Plumbing fees , are up 1000’s of percent since that time. So why would this not be largely inflationary to Renters if these costs are being passed down from Landlords and Homeowners ?

    We have a Transfer Tax when selling a Property that is 2200 % higher than 95% of Cities in California.

    http://www.californiacityfinance.com/PropTransfTaxRates.pdf

    Comment by Cobalt Black Keys Johnson — August 24, 2015 @ 8:53 pm

  19. Using a CPI inflation Calculator these fees should be a little more than double since 1983 and our Fees and Permits are up 10, 20, 30,40 times in many instances since 1983.

    So your CPI story isn’t used very well when adjusting Permits Fees, and City Charges along with wages and benefits. But you want us to believe the BC index of CPI.

    Comment by Cobalt Black Keys Johnson — August 24, 2015 @ 9:11 pm

  20. #11. Two John D’s. One I knew was active in the St. Barnabas Parish for many years. He was dedicated to social justice and worked constantly to help others, be it with HOPE, or his work with the St. Vincent de Paul, delivering furniture and household needs to families transitioning into permanent housing. He had a white van with shamrocks on it and did some sort of laundry business. He was the essence of a “good man”. The other, I did not know, but have heard he was pretty much of a curmudgeon and scoff law.

    Comment by Kate Quick — August 25, 2015 @ 6:53 am

  21. 18 and 19: Sorry, you’re really out of your depth on this one.

    Comment by BC — August 25, 2015 @ 12:41 pm

  22. 21)

    I pulled the copies and all the paper work for a Room Addition and New Bathroom and all new Electrical and a new Box and a Sewer Line Extension from 1983.

    Fees and Permits and Plan Fees

    Building Fee Permit and Plan Check

    $64.00

    Plumbing

    $6.00 —-New Basin
    $6.00 —-New Closet
    $6.00 —-New Shower
    $6.00 —-Gas Outlet
    $20.00 –Sewer Extension
    $6.00 —- Plan Check Fee

    Electrical Permit for New Box

    $ 25.00— Permit and Plan Check

    What are these Fees in 2015 ?

    CPI inflation Calculator says they should be just over Double these prices.

    Comment by Cobalt Black Keys Johnson — August 25, 2015 @ 6:14 pm

  23. The CPI inflation calculator (or Calculator, should one prefer) says nothing (indeed, Nothing) about individual prices. Nor does your Chaffedwood index.

    Comment by BC — August 26, 2015 @ 4:39 pm

  24. Speaking of being in over your head.

    About the CPI Inflation Calculator

    The CPI inflation calculator uses the average Consumer Price Index for a given calendar year. This data represents changes in prices of all goods and services purchased for consumption by urban households. This index value has been calculated every year since 1913. For the current year, the latest monthly index value is used.

    What is the CPI?
    The Consumer Price Index (CPI) is a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.

    How is the CPI used?
    The CPI affects nearly all Americans because of the many ways it is used. Following are major uses:

    As an economic indicator. More.
    As a deflator of other economic series. More.
    As a means of adjusting dollar values. More

    hat goods and services does the CPI cover?
    The CPI represents all goods and services purchased for consumption by the reference population (U or W) BLS has classified all expenditure items into more than 200 categories, arranged into eight major groups. Major groups and examples of categories in each are as follows:

    FOOD AND BEVERAGES (breakfast cereal, milk, coffee, chicken, wine, full service meals, snacks)
    HOUSING (rent of primary residence, owners’ equivalent rent, fuel oil, bedroom furniture)
    APPAREL (men’s shirts and sweaters, women’s dresses, jewelry)
    TRANSPORTATION (new vehicles, airline fares, gasoline, motor vehicle insurance)
    MEDICAL CARE (prescription drugs and medical supplies, physicians’ services, eyeglasses and eye care, hospital services)
    RECREATION (televisions, toys, pets and pet products, sports equipment, admissions);
    EDUCATION AND COMMUNICATION (college tuition, postage, telephone services, computer software and accessories);
    OTHER GOODS AND SERVICES (tobacco and smoking products, haircuts and other personal services, funeral expenses).

    Also included within these major groups are various government-charged user fees, such as water and sewerage charges, auto registration fees, and vehicle tolls.

    In addition, the CPI includes taxes (such as sales and excise taxes) that are directly associated with the prices of specific goods and services. However, the CPI excludes taxes (such as income and Social Security taxes) not directly associated with the purchase of consumer goods and services.

    So government charged user fees like our Building Permits, and all other fees should probably be in line with the CPI.

    In Alameda these fees have spiked in 1000’s of percent to the CPI while peoples wages in private sector and those on fixed incomes get wiped out or put in tremendous hardships by these spikes.

    Plus landlords are forced to raise rents to stay up with these charges.

    The solution is to tie Rent Control to the Same Percentage the City has used in raising their rates on fees .

    Another solution is to pay people on fixed incomes the same rate of increases the City, County , State and Federal Government employees have taken in their pay and benefits the last 25 years.

    Everyone wouldn’t be so broke.

    Comment by Cobalt Black Keys Johnson — August 26, 2015 @ 9:50 pm

  25. Everyone would squawk if we had to take 40% of their wages to pay for past workers in retirement but we sit here every year watching the tax payers pay into retirements of of city employees these kind of numbers to make their fund whole.

    Interesting times we are in.

    Comment by Cobalt Black Keys Johnson — August 26, 2015 @ 9:58 pm

  26. The Chapwood Index Methodology
    Financial experts at Chapwood Investments, LLC have spent the past 4 years engaged in groundbreaking research that uncovers the real cost of living percentage increase for every major metropolitan area in the United States.
    Numerous organizations have struggled to reveal inaccuracies in the government Consumer Price Index (CPI) methodology by calculating alternative inflation rates.
    No one, until now, has ever attempted to objectively determine the real cost of living percentage increase without the influence of the flawed government model.
    Over two years, we collected data from friends and associates across the country on over 4,000 items to see what they spent money on in their daily lives. We then narrowed these items down to the top 500 most frequently used and relevant items. Those items became the basis of the Chapwood Index.
    Every six months, we take the precise price for the same item quarter by quarter and calculate the increase or decrease, then developed a weighted index based on price. These items include basically everything that most Americans consumer during the course of their lives.
    Some items in the Chapwood Index include:
    Health Insurance
    Mortgage
    Rent
    Electricity
    Water & Sewer
    Gas Bill
    Car Loan Payments
    Car Lease Payments
    Internet
    AT&T U-verse
    Verizon FIOS
    Dish TV
    Cell Phone Cover
    Car Phone Charger
    iPhone service
    Blackberry service
    Lawn Service
    Pool Service
    Bluetooth
    Pest Control
    Postage
    Envelopes
    Home association dues
    Water Delivery
    Clocks
    Newspaper Delivery
    Washing Machine
    Costco membership
    Dish towel
    Plumbing emergency
    Life insurance
    Water hose spray
    Set of allen wrenches
    Pay Per View Rental
    Bed Sheets-Queen
    Space Heater
    Pool assecories
    Iron
    Ironing board
    Set of glasses
    Click here to see the complete list of the Chapwood Index 500 items.

    http://www.chapwoodindex.com/chapwood-index-items/

    Comment by Cobalt Black Keys Johnson — August 26, 2015 @ 10:04 pm

  27. Run this by the Union Fire Meeting. The City will start taking 48 % percent of your pay out to take care of peoples retirement who live in the City of Alameda. It Will match the 48 % they are paying into your Retirement down the road. We appreciate your service and helping out the Citizens of Alameda.

    Comment by Cobalt Black Keys Johnson — August 26, 2015 @ 10:24 pm

  28. A+ in cutting and pasting. C- in critical thinking.

    Comment by BC — August 27, 2015 @ 10:50 am

  29. 28)

    Keep coloring in your Color Book and make sure you stay within the lines.

    “It’s easier to fool people than to convince them they have been fooled.”

    Pass the BC CPI bag of manure

    Comment by Cobalt Black Keys Johnson — August 27, 2015 @ 11:07 am

  30. Not to be cynical, CBKJ, but your posts have become little more than advertisements for Chapwood Investments. This Ed Butowsky doesn’t even rate a Wikipedia page. There is nothing online about him or his company that is any more than self-promotion. There are hundreds of people out there doing the same thing.
    Maybe you should broaden your horizons. One person seldom has all the answers.

    Comment by vigi — August 27, 2015 @ 11:34 am

  31. Vigi I have No Interest in Chapwood ……. I just think they give a real assessment to Real Inflation…And they answer alot of questions on why people have no money , and those living on fixed income trying to keep up with inflation, whose incomes are tied into the CPI.

    The Government numbers are misleading and put many in quite a quandary.

    Including the Rent Issues many are dealing with.

    Comment by Cobalt Black Keys Johnson — August 27, 2015 @ 12:01 pm

  32. CBKJ, have you checked out the Infowars website? I think you’d love it. The possibilities for cutting and pasting conspiracies are boundless.

    Comment by BC — August 27, 2015 @ 12:18 pm

  33. I know kids that are both working two jobs a piece and can’t afford to pay rent and own a car and have 4 people living in a one bedroom to try and live.

    The Government Stepped in to save the housing market and all the distressed real estate was sold in large Blocks to Pension Funds like CalPERS , CalSTERS 20 cents on the dollar without opening it up to people that really needed housing.

    Thats why you see the rates of home ownership keep falling.

    Comment by Cobalt Black Keys Johnson — August 27, 2015 @ 12:24 pm

  34. BC keep playing with your Charmin. Quit touching yourself.

    Comment by Cobalt Black Keys Johnson — August 27, 2015 @ 12:26 pm

  35. The sad history of 1617 Central…This grand mansion (built 1897 for $7482) was cut up into individual apartments without building permits. After some code enforcement actions, certified permit search was done, and as no permit exists for the apartments, the max number of apartments for this house is 2, or a duplex. Doherty appealed the City’s decision but to no avail. The first owner after Doherty, Wrecking Belle Inc., took out many permits in 2013, to renovate the place. She took out a huge tree also. Looking at the little bungalows that the firm has done in Oakland, perhaps they had no experience with such a huge renovation. The East Bay Express had pictures of the interior that looked pretty bad. I hope that the new owners are not going to just sit on it until it is completely deteriorated. There is a permit application from December 2014 to make it from 12 apartments back into a single family home.

    Comment by Kevis Brownson — August 27, 2015 @ 7:14 pm


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