In a significant shift for Southern California‘s housing landscape, recent court rulings have ended the requirement for landlords in Los Angeles and Pasadena to provide relocation assistance to tenants facing substantial rent increases. This change has left tenant advocates concerned about the increased burden on renters, while landlord groups argue that the previous rules were unfair.
The California Apartment Association successfully challenged Pasadena’s relocation requirement, arguing that it imposed unfair costs on landlords exercising their legal right to raise rents. In, a California appellate court ruled that Pasadena’s requirement was illegal. In April, the California Supreme Court declined to review the decision, effectively ending the requirement. A similar case in Los Angeles used the Pasadena ruling as precedent to strike down a comparable rule in that city.
Impact on Tenants and Landlords
Tenant advocates express concern that the court decisions will place a heavier financial burden on renters who are displaced due to rent hikes. Ryan Bell a coordinator with Tenants Together and a member of the Pasadena Rental Housing Board, stated that the relocation payments were designed to cushion the blow of displacement. With these payments no longer required, tenants will have to bear the full cost of finding new housing.
On the other hand, landlord groups argue that the previous rules were unfair. Whitney Prout who works on legal affairs for the California Apartment Association, said that the requirements imposed heavy costs on landlords who raised rents within legal limits. She described the situation as a consequence imposed for exercising a legal right which she argued was effectively limiting that right.
The Origins of Relocation Assistance
Pasadena’s relocation requirement was established by Measure H a ballot initiative that implemented rent control and eviction protections. The measure required landlords to pay relocation assistance if they increased rents by more than 5% plus the city’s current rent control cap, which is currently 7.25%. Tenants who informed their landlords that they could not afford increases above that amount were entitled to relocation payments.
The protection was not designed for tenants living in rent-controlled apartments, as landlords cannot legally raise rents that much in those units. Instead, the relocation payments were intended for tenants living in other types of housing not covered by local limits, such as single-family homes, condos, and apartments built after February 1, 1995.
Relocation Payments Still Required in Some Cases
While landlords are no longer required to pay relocation fees due to rent hikes, they still must provide assistance to tenants who are evicted through no fault of their own. This includes cases where landlords want to move a family member into the tenant’s unit. The amount of relocation assistance varies based on factors such as the number of bedrooms, the tenant’s length of residency, and their age, parental status, and disabilities. In Pasadena, payments range from $8,340 to $40,210. In Los Angeles, the range is from one month’s rent to $27,400.
Changes in City Policies
In light of the recent court rulings, both Los Angeles and Pasadena have removed information about relocation payments triggered by rent hikes from their websites. Santa Monica, which also required such payments, has not yet responded to inquiries about whether it will change its enforcement approach. The city still lists the requirement in its online documents.
The changes have been welcomed by landlord groups, who felt blindsided when the rules first took effect a few years ago. Many landlords were surprised to learn that, despite not being subject to rent control, they could face significant financial consequences for raising rents beyond certain limits.
