COUNCIL MEETING: November 28, 1995 Santa Monica, California
TO: Mayor and City Council
FROM: City Staff
SUBJECT: Recommendation to Direct the City Attorney to Prepare
an Ordinance Clarifying the Issue of Owner Obligation
to Pay the Cost of Temporary Accommodations to Tenants
Displaced as a Result of Owner Compliance with
Retrofitting Obligations Imposed by the Potentially
Hazardous Structures Ordinance (Ordinance 1748 (CCS)).
INTRODUCTION
This staff report recommends that the City Council direct the
City Attorney to prepare an Ordinance clarifying the issue of
owner obligation to pay the cost of temporary accommodations for
tenants displaced as a result of owner compliance with
retrofitting obligations imposed by the potentially hazardous
structures ordinance (Ordinance 1748 (CCS)).
BACKGROUND
On June 21, 1994 the City Council adopted Ordinance #1748 which
requires owners of certain types of potentially hazardous
buildings to retrofit their buildings in order to prevent damage
due to future earthquakes. The ordinance was adopted in response
to damage patterns to certain buildings from the January 17, 1994
Northridge earthquake. One type of building that must be
retrofitted per the ordinance are non-ductile concrete buildings.
Retrofitting of non-ductile concrete buildings often requires the
displacement of the tenants during the retrofitting process. The
City has approximately 70 non-ductile concrete buildings, of
which approximately 1/3 are residential.
In some circumstances the Municipal Code requires owners of
residential buildings to pay the cost of temporary accommodations
when tenants are displaced. Specifically, Municipal Code Section
4.36.100 provides as follows:
"If a landlord is required to recover possession of a rental
housing unit in order to comply with housing, health, or
safety laws of the State of California or the City of Santa
Monica, or if a tenant is required to vacate a unit upon the
order of any government officer or agency, the landlord
shall be responsible for the reasonable cost of temporary
accommodations for the displaced tenant necessitated by such
recovery of possession until such time as the tenant is
restored to possession."
If, however, the displacement and relocation of the tenant is the
result of an earthquake, the owner is not obligated to pay for
temporary accommodations. This exemption is stated in Section
4.36.120(b) as follows:
"Section 4.36.100 shall not be applicable if the
displacement and relocation of the tenant is the result of a
fire not caused by the landlord, earthquake or other natural
disaster."
Thus, when tenants have been displaced because of the necessity
to do earthquake repair work to a structure, owners have not been
obligated to pay temporary accommodation benefits to tenants.
However, this is the first time the issue of whether owners
should be exempt from paying temporary accommodations when tenant
displacement is not due to earthquake repair, but to the need to
comply with earthquake retrofitting requirements imposed by
Ordinance 1748 (CCS) has come to the attention of the City. Both
4.36.100 and 4.36.120 were adopted before the retrofitting
requirements which were developed in the wake of the Northridge
earthquake. Whether tenant displacement in this context should
be interpreted as "the result of a[n] . . . earthquake" pursuant
to 4.36.120 has not been addressed.
The first instance where this issue arises is at 201 Ocean Avenue
at the Ocean Towers building. The Ocean Towers project consists
of two building both 16 stories tall. The first of the two
buildings to be retrofitted is the Palisades building with 157
total residential units, of which 41 are occupied by tenants of
owners of the units. It is estimated that the construction
process will take approximately one year for each building, with
approximately six months required for earthquake repairs, and
approximately six months required for retrofitting. The
construction will be phased for the two buildings for a total two
year construction period for the site. Both projects will
require the displacement of the tenants.
It is clear that the owner(s) of Ocean Towers are exempt from
paying temporary accommodation costs for the six months required
for earthquake repairs. However, depending upon the
interpretation of Chapter 4.36 of the Municipal Code, the
owner(s) of the building may be required to pay relocation
benefits to the tenants during the six months required for
retrofitting the building under Ordinance #1748(CCS). Staff is
asking the Council to direct the City Attorney to draft an
amendment to the Municipal Code to clarify this issue.
POLICY OPTIONS
This issue is a policy matter, and there are several options
available to the City Council. Each would include an amendment
to 4.36.100 or 4.36.120 to clarify owner obligations. The
options include:
1) Require the property owner to pay the cost of temporary
accommodations to tenants displaced by retrofitting
construction arising from owner compliance with
Ordinance 1748 (CCS) for the full period of
displacement.
2) Do not require the owner to pay the cost of temporary
accommodations to tenants displaced by retrofitting
construction arising from owner compliance with
Ordinance 1748 (CCS).
3) Require property owners to pay the cost of temporary
accommodations to tenants displaced by retrofitting
construction arising from owner compliance with
Ordinance 1748(CCS) only when displacement exceeded a
specific period of time.
4) Require property owners to provide a moving allowance,
cost of storage, or other displacement costs to tenants
displaced by retrofitting construction arising from
owner compliance with Ordinance 1748(CCS) at the time
of displacement or after displacement had exceeded a
period of time.
Staff is recommending the third alternative as a fair approach to
the situation. The adopted retrofitting ordinance requires
compliance by property owners, and it seems unfair to require
property owners to retrofit their buildings, and pay the cost of
temporary accommodations in order to comply with a City
requirement. However, requiring temporary accommodation payments
after 180 days for low rise buildings (less than five stories
tall) and 270 days for high rise buildings (five stories or
taller), with 270 days and 360 days respectively if asbestos
removal is required, would provide incentive to the property
owner to complete the retrofitting in a timely manner and
expeditiously allow for tenants to return to their units. To not
have any owner obligation to pay temporary accommodation benefits
could result in no incentive for the property owner to complete
the project and allow tenants to move back in to their units.
The time periods selected were based upon an average length of
time a retrofit project would be expected to take, based upon
information provided by Building and Safety Division staff,
contractors and experts in earthquake retrofitting. It is
recommended that there be separate time periods based upon the
size of the building, since there is a direct proportion of
effort based upon the height of the building. Asbestos removal
is also a timely consideration that should be factored into the
length of time for retrofitting a building.
BUDGET/FINANCIAL IMPACT
The recommendation in this report will not have a budget or
fiscal impact to the City. The retrofitting requirements have
been previously adopted by the City Council in Ordinance #1748.
This staff report addresses the policy question as to the
appropriateness of relocation benefits in buildings that must be
retrofitted, and therefore will not have a budget or fiscal
impact to the City.
RECOMMENDATION
It is recommended that the City Council direct the City Attorney
to prepared an ordinance clarifying the issue of owner obligation
to pay the cost of temporary accommodations to tenants displaced
as a result of owner compliance with the retrofitting obligations
imposed by the potentially hazardous structures ordinance
(Ordinance 1748(CCS).
Prepared by: Suzanne Frick, Director
Paul Casey, Assistant to the Director
Planning and Community Development Department