The information in this article is not a substitute for legal advice. Specific questions concerning this proposed law’s application to your individual circumstances should be directed to your own attorney.
Nobody likes to use their right to evict. Usually and ideally, a tenant and landlord can come to an agreement and eviction can be avoided saving time, money, and heartache. However, should disagreements arise the right to evict is an important component of property rights, giving real estate owners the ability to re-gain possession of their property in difficult situations. There is a new ballot initiative that is circulating throughout the city of Santa Cruz that poses to, in many situations, take away this right. This will increase the risk of renting out a unit in the city.
Section 5, Just Cause For Eviction Protections; Family Protections of the City of Santa Cruz Rent Control and Tenant Protection Act (now Measure M) spells out when you can evict a tenant under the ballot initiative. However, it also includes numerous “exceptions” which restrict landlords ability to regain possession of their property. In this article, we walk through through the proposed Just Cause for Eviction section of the ballot initiative, pointing out these exceptions and what they mean for landlords.
As a landlord operating under this new ballot initiate you may evict a tenant for one of the following reasons, should no exceptions apply:
- Failure to Pay Rent
- Breach of Lease
- Illegal Purpose
- Failure to Give Access
- Refusal to Execute a New Lease
- Subtenant in Sole Possession
- Vacating an Unpermitted Rental Unit
- Owner to Move-in
- Necessary and Substantial Repairs requiring Temporary Vacancy
- Withdrawal of the Unit Permanently from the Rental Market
- Temporary Vacancy
If you elect to evict the tenant due to reasons 5(A) or 8-11 of the original proposal, you will be obligated to provide “Relocation Assistance”, or 6 months worth of “fair market rent”, to affected tenant households. Here, fair market rent refers to the rent for a similar Rental Unit in Santa Cruz County as determined by the U.S. Department of Housing and Urban Development. The Rental Board (which will be created under the new law) will have the power to increase this total dollar amount. This fee poses to increase the cost and risk of owning a rental property in Santa Cruz City.
Additionally, if a tenant cannot pay rent increases in excess of 10% in a given year, the tenant may be eligible for relocation assistance. Furthermore, the Rental Board has the ability to lower the rate-increase percentage in this measure.
Of these 12 points, more than half include exemptions. In an attempt to make the proposed ordinance clear and transparent, we’ve outlined these exemptions below.
#2 ) Breach of the Lease
If a tenant breaches his or her lease terms, you must first provide the tenant with a written notice to cure. If the tenant still does not correct their actions you can evict them under certain conditions.
When Can’t You Evict Under Breach Of Lease?
If a tenant fails to sign a new lease which includes substantial changes from the previous lease, either at the end of or during a tenancy, this is not a just causes for eviction. This means that the landlord does not have the ability to unilaterally change a lease, even at the end of a lease-term. Under these new laws, the original lease will become a very strong binding legal document.
Landlords may not create a provision within a lease requiring tenants to leave with proper notice and without just cause. For example, if such a clause were to exist in the lease, and the only way the tenant is violating the lease was by not leaving when the landlord gives notice, there is no right to evict the tenant. This means that a landlord cannot unilaterally terminate a lease.
NOTE: if a lease expires and the landlord proposes the same lease or nearly the same and the tenant refuses to sign a new lease, that is grounds for eviction. This falls under just cause for eviction reason number 6) Refusal To Execute A New Lease.
A landlord cannot terminate a tenancy based on a Tenant’s sublease of the Rental Unit if all of the following requirements are met:
- The tenant continues to reside in the rental unit as his or her primary residence;
- The sublease replaces one or more departed Tenants under the Rental Agreement on a one-for-one basis;
- The landlord has “unreasonably withheld” the right to sublease following written request by the Tenant. The landlord must respond to the tenant’s written request within 14 days of receipt of the Tenant’s request or the request is deemed approved. The landlord cannot deny the request due to lack of creditworthiness of the subtenant if the subtenant is not required to pay some or all of the rent to the landlord directly.
The landlord can refuse the tenant’s written request to bring a subtenant into the property on the grounds of the total number of occupants in the Rental Unit exceeding the maximum number of occupants as determined under Section 305(b) of the Uniform Housing Code. Determining “maximum number of occupants” for a given rental unit is not straightforward:
According to Health and Safety Code Section 17922, Uniform Housing Code Section 503(b), every residential rental unit must have at least one room that is at least 120 square feet; other rooms used for living must be at least 70 square feet; and any room used for sleeping must increase the minimum floor area by 50 square feet for each occupant in excess of two.
There are additional restrictions within this subsection that limit a landlord’s ability to stop a tenant from bringing in relative-subtenants. For example, you can not terminate because a tenant has brought his or her
- spouse or partner
- child or foster child,
- spouse or partner of any relative listed above,
into the unit, unless the number of occupants exceeds the maximum number of occupants as determined under Section 503(b) of the Uniform Housing Code as incorporated by California Health & Safety Code 17922.
#4) Illegal Purpose
After being given written notice to cure, and failing to do so, a tenant may be evicted for illegal behavior in a Rental Unit. However a tenant cannot be evicted from the unit on the sole-grounds of the unit itself being illegal (unpermitted) aka living in an illegal unit.
#5) Failure to Give Access
You must notify the tenant, in writing, of your wish to gain access to your rental property for the purpose of making repairs, maintenance, or improvements, or to conduct inspections or show the unit to prospective purchasers or mortgagees. If the tenant refuses to grant access to such a party, you may have a just cause for eviction.
Additionally, you cannot put a lockbox on the property while the tenant is in possession, making it difficult to coordinate the repairs, inspections, and the showing of your property. Furthermore, a Rent Board will have the power to make additional regulations restricting a landlord’s ability to gain access to a property.
#9) Owner Move-In
As a property owner, if you would like to move into a unit, or have a family member (your spouse, partner, children, grandchildren, parents or grandparents) move in, you will need to consider the following:
- Do you or does your relative occupy a unit on the property? If so, there may not be a just cause for eviction under this section unless the property contains 3 dwelling units or less and the landlord or relative has lived in one of the units, as a primary residence, for at least 3 years.
- Is there another vacant, comparable unit in the property? If so, or if one becomes available, you may not evict a tenant under this subsection.
- Would you or your relative be able to move into the property within 90 days after the tenant leaves and remain in the property for at least 3 years? If not, then you may not evict a tenant under this subsection.
If you or your relative fails to occupy the unit, you must notify the Rental Board, offer the unit to the tenant who vacated, at the same rent he or she was paying previously, and pay the tenant all reasonable expenses incurred in vacating and reoccupying the unit.
Other restrictions apply. See the actual text for more information.
#10) Necessary and Substantial Repairs Requiring Temporary Vacancy
All rental units will require maintenance and repairs at some point in time. When that time comes for your unit, if you are required to ask a tenant to leave, you will need to keep the following in mind:
- The work must last longer than 30 days to be considered a just cause for eviction.
- You must choose between one of these two options:
- You’ll give the tenant the first right of return to reoccupy the Rental Unit once the repairs are complete at the same rent charged before the Tenant temporarily vacated the rental unit; or
- If you have a comparable vacant rental unit, you must give the tenant the first-right of refusal for this unit. If the tenant chooses this option, you may have to reimburse the tenant’s moving expenses.
If you want to raise the rents within the succeeding 6 months after the work has been completed, the tenant who was previously in the unit will have his or her rights intact as if he or she is still living in the unit. For example, if rent control were in place and you wanted to raise the rents above the allowable rent-increase amount, this would be allowable if you were starting a new tenancy. However, your previous tenant still has the right to move back in for 6 months after the work was completed and would not be subject to the rent-increase. In this scenario, to increase the rent by the amount you would like, you would need to submit a written waiver by the tenant of his or her right to reoccupy the premises.
#11) Withdraw the Unit Permanently From the Rental Market
Section 11 stipulates that, if you want to take your property off of the rental market, you will need to file documents with the Rent Board to initiate the withdrawal process. Additionally, you must give tenants 120 days – 1 year notice, depending on their age and disability status.
If someone purchases your property (becomes a “subsequent landlord”) this person then becomes obligated to offer the unit to the same tenant if he or she decides to put the unit back on the market.
If either you or a subsequent landlord puts the rental back on the market anytime within 10 years from withdrawing it, the previous tenant must be given first-right of refusal. Furthermore, if you or a subsequent landlord take the rental unit off of the market for fewer than 5 years, upon re-entry you must give the same tenant the first-right of refusal and a lease at their formal rental rate.
This means, if someone purchases a rental-property that is occupied, he or she has very little control over the rent and who occupies the property.
#12) Temporary Vacancy
If you would like to rent your unit for some time period less than or equal to one year for the purpose of travel or a temporary work-related opportunity, you will have a just cause for eviction under certain conditions if the tenant refuses to leave after that time-period.
To maintain the right to evict, the same unit must have been your primary residence for at least six months prior to the tenancy and you must return to the same property, as your primary residence, in 1 year or less.
The proposed just cause for eviction ballot initiative is a one-sided law that poses to drastically reduce the property rights of landlords. If you disagree with these changes and would like to take action to stop the ballot initiative from coming into law, please consider sharing the following articles with your friends and family.
If you are a property owner or investor in the Santa Cruz City limits, and would like to discuss your options, feel free to contact me at 831-600-6550.