Los Angeles Business Journal

Landlords Want to Toss Eviction Bill

POLITICS: Proposal would limit owners’ ability to sell properties. By Howard Fine Originally published March 17, 2014 at midnight, updated March 18, 2014 at 5:35 p.m.

EDITOR'S NOTE: This story has been corrected from the print version. An initiative is not among the options being considered by the tenants’ rights organization Coalition for Economic Survival if a state bill passes to limit evictions under the Ellis Act.

The value of his rental properties took a hit during the real estate downturn. And now that the market is on the upswing, Earle Vaughan fears a new bill in Sacramento could send them sliding back down.

Vaughan owns seven small apartment buildings in the city of Los Angeles. He’s concerned that the proposed bill would make it almost impossible for apartment building owners to evict tenants in order to sell their properties. That could discourage potential buyers and push down sale prices.

“This bill would unquestionably lower the price of my properties,” Vaughan said.

He is one of scores of local landlords fighting the bill. Two local landlord associations – the Apartment Association of Greater Los Angeles and the L.A. division of the California Apartment Association – also oppose the bill. They all claim the bill, AB 2045, would place nearly insurmountable obstacles before landlords wishing to sell their properties.

Under a state law called the Ellis Act, landlords in rent-controlled cities are allowed to evict tenants in order to sell their properties or convert them to condos as long as they give sufficient notice and pay moving expenses. Landlords are also granted speedy hearings. The proposed bill would allow local governments to place moratoriums on such evictions. Rent-control laws have been in force in Los Angeles, Santa Monica and West Hollywood since the 1980s, making it sometimes tough for landlords to take care of their aging buildings.

“In some rent-controlled cities, the Ellis Act is the only way owners can say enough is enough when they are not able to maintain their buildings,” said Beverly Kenworthy, executive director of the California Apartment Association’s L.A. division.

The Ellis Act, adopted in 1985, gives landlords who wish to sell or convert their properties the right to evict tenants without just cause, as long as they provide at least four months notice and pay relocation fees of up to $20,000 per tenant. After the four months, landlords can use an expedited legal process to evict tenants who have refused to leave. Tenants with disabilities or over the age of 62 must be given a year’s notice before eviction proceedings can start.

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