By Jorge Casuso

August 24, 2022 -- Under an emergency ordinance approved by the City Council Tuesday, rent control tenants who receive a rent increase of more than 3 percent can defer their rent for up to five months.

While the ordinance only applies to tenants suffering from "financial stress" due to COVID, they can "self-certify" by stating they can't pay the rent, a contention they would then have to prove in court if evicted.

The ordinance -- which was approved 5 to 2 and goes into effect immediately -- is meant to entice landlords to give tenants no more than the 3 percent increase proposed under a Charter Amendment the Council placed on the November ballot earlier this month.

Those who supported the moratorium argued that it protects tenants who can't pay the 6 percent increase mandated under the current Charter while the City launches a program to help "rent burdened" tenants bridge the gap.

"What we're really doing is protecting tenants from being evicted" during the interim, said Councilmember Gleam Davis.

"This is a homelessness prevention program," Davis said. "What we really want to do is not have people evicted from their homes."

Councilmember Phil Brock strongly opposed the proposal to defer the entire rent, proposing instead to apply the moratorium only to tenants who can't pay the increase.

"You're saying (tenants) can just negate their entire rent, which puts landlords in more of a hole than they're in now," Brock said, adding that landlords are already dealing with a 9 percent inflation rate.

"That doesn't make any sense to me," he said. "I don't know where the justification is."

Councilmember Oscar de la Torre, who cast the other opposing vote, agreed.

"I think it's going to incentivize (small mom and pop landlords) to get out of the housing business in Santa Monica, and we're going to lose affordable housing, and renters are going to pay the price."

De la Torre said he worried the moratorium could prompt tenants to defer their rent payment and not be able to pay by the August 31, 2023 due date.

"You don't want tenants to fall so far behind on rent, tenants who are in a financial squeeze falling deeper into the hole," de la Torre said.

Davis called Brock and de la Torre's concerns "a little apocalyptic" and ""hyperbole."

Councilmember Lana Negrete, who made a motion to apply the moratorium only to the rent increase -- and not the entire rent -- was persuaded by Davis' arguments and withdrew her proposal.

Mayor Sue Himmelrich then made a motion to "abate all the rent because that is a carrot and stick."

She noted that landlords who raise the rent by more than 3 percent over the next five months would face an adjustment that would, in the end, average out to 3 percent for the year if the ballot measure passes, as expected.

But they would risk having the tenant defer the entire rent for those months.

The Council then debated a concern raised by Negrete that the moratorium may have come too late, since landlords likely have already given tenants notice of the increase.

Under the approved ordinance, landlords who increased the rent by more than 3 percent in September can reduce it the following month and expect to be repaid by the tenant, if need be with the City's assistance.

Brock said the ordinance approved after an hour-long debate added another layer of bureaucracy and sowed more confusion about what should have been a straight-forward measure.

"We created with this vote tonight more confusion for landlords, more confusion for tenants, and more paperwork," Brock said. "We didn't use common sense."

Said de la Torre, "We're creating a division between landlords -- housing providers -- and tenants, and I don't think it's the right way to go about this."