Santa Monica, West Hollywood Populations Dip in ’90s

Prosperity has its costs.

While almost all of California experienced population growth during the 1990s, two of L.A. County’s most desirable cities, West Hollywood and Santa Monica, actually saw their populations decline, according to the U.S. Census Bureau’s 2000 census.

While the beach town and the home of the Sunset Strip are in many ways as different as prosperous cities can be, they do share one thing in common: rent control.

And depending on whom you talk to, the causes for the population declines in these quintessential L.A. places is either the stringency or flexibility of those laws.

Santa Monica’s population dropped over the last 10 years to 84,084, down 3.2 percent from the 1990 census and the fourth biggest percentage loss in L.A. County. West Hollywood’s population slipped 1.1 percent to 35,716.

Overall, the state population swelled to 33.9 million, up nearly 12 percent from 1990. L.A. County’s population climbed to 9.5 million, up 7.4 percent from 1990.

The rent control movement in California was led by Santa Monica, which along with West Hollywood imposed very strict rent control ordinances in the 1970s. Political activists Tom Hayden and Jane Fonda, who lived in Santa Monica then, toured the state touting the regulations, and 10 cities Los Angeles, San Jose, San Francisco and East Palo Alto among them eventually adopted some form of rent controls.

In 1995, passage of the state’s Costa-Hawkins Rental Housing Act banned rent control but allowed what the legislation refers to as “vacancy decontrol” preserving rent controls and tenant protections for occupied apartments, but removing them once the tenant moves out. The change allowed landlords to get market rate for an apartment once a tenant moved out.

Whether rent control affected population isn’t really disputed it’s a question of whether it was the imposition or rollback that had the impact.

The Costa-Hawkins rollback “lessens stability and makes tenants feel vulnerable in their units,” said Doris Ganga, Santa Monica’s general counsel.

According to that argument, longtime tenants have been getting pressured to move out of rent-controlled apartments, and once they do, they can’t afford to live in Santa Monica anymore.

“There has been a lot activity by some landlords to get tenants out,” Ganga said. “If landlords can get the long-term tenants out, then they can rent for market rate. Some landlords are not making the necessary repairs and making life miserable for their tenants.”

Once longtime tenants move out, and landlords raise the rents to market rate, few renters can afford to pay those higher rents for extended periods of time. The result, Ganga said, is that rents have been soaring and a more transient population is passing through the city. Some landlords have even resorted to renting units on a weekly basis to visitors or business travelers.

Robert Sullivan, a real estate agent and past president of the Apartment Association of Greater L.A., paints an entirely different picture of Costa-Hawkins and its impact. He blames the earlier and stricter rent control laws for Santa Monica’s and West Hollywood’s population decline.

“The same apartments that were renting for $650 a month in Santa Monica had been renting for $900 to $1,200 in parts of West L.A.,” he said.

That prompted Santa Monica and West Hollywood landlords to take cost-cutting measures, like renting to fewer tenants.

“Up until a year ago, when you could begin renting at market rate, it was not in your best interest to rent to more than a few people,” Sullivan said. “The less wear-and-tear on the building, the less costs there would be to operate the building.”

More affluence, fewer people

To urban planners, measuring the impact of rent control on population densities is tricky business.

“There are any number of possible scenarios,” said Michael Teitz, director of research of the Public Policy Institute of California and a specialist on rent control.

Fewer rent control apartments, he said, may have contributed to a rise in the affluent population, which can afford the higher rents.

“Clearly, these are places that have not, as result of Costa-Hawkins, been the focus of heavy immigration,” Teitz said.

Paradoxically, the rise in the affluent population of the cities means fewer overall people, because there is a lower concentration of affluent people in the total population.

A broader regulatory climate in Santa Monica and West Hollywood not just rent control also may have contributed to the declines in population, according to Teitz.

“In both cities, you may be seeing constraints on development in which the populations are trying to maintain their quality of life and are resistant to residential development and redevelopment,” Teitz said.

Santa Monica city manager Susan McCarthy said she is “not terribly surprised” by the census figures.

“Santa Monica is built out,” she said. “It’s not a growing community.”