Two of the Santa Barbara City Council’s strongest rent stabilization advocates collided Tuesday night over whether exemptions for affordable housing tenants should be included in the ordinance.
Councilmember Meagan Harmon said she would only support moving the ordinance forward with two exemptions—housing that is deed-restricted on affordability, and housing that is low-income via Section 8 vouchers. Both exemptions were recommended by the Santa Barbara Housing authority, which Councilmember Harmon sided with.
“My support for this ordinance is strong,” Harmon said at the meeting. “But for me to vote yes, it must include these two exemptions.”
But Councilmember Santamaria argued that exempting “already vulnerable tenants” would cut them off from the protections the ordinance provides. For example, exempted units would not be inspected for habitability, she said. Santamaria worried that without the access to the rent stabilization board the ordinance would create, tenants in exempted housing would be left even more vulnerable.
“So we’re saying we don’t want to protect tenants in Section 8 and affordable housing units when it comes to habitability?” Santamaria said.
Harmon fired back that there is already a separate system in place for habitability issues.
“I do appreciate Santamaria’s concern about habitability,” Harmon said in a separate interview. “But our goal should be to improve existing pathways, not to lose our section 8 housing altogether.”
The conflict sets the stage for a potentially dramatic vote next Tuesday when the council is set to formally approve the rent stabilization ordinance. Activists contend that residents have been driven out of Santa Barbara by high rents, forcing the need to cap the amount that landlords can raise rents. But property owners argue that the proposed ordinance is too restrictive and will force them to sell their buildings to out-of-town corporate landlords.
The proposed ordinance caps annual rent increases to 60% of CPI.
As the hours passed Tuesday night, City Administrator Kelly McAdoo suggested pushing the item back to give the city council more time. Santamaria said it might be worth breaking and coming back instead of prematurely making a decision.
In the end, Harmon’s motions won the day. As of now, the rent stabilization ordinance will include the two exemptions.
The first exemption excludes Capital A deed-restricted affordable units from the rent stabilization ordinance. This housing is built by the Housing Authority and subsidized by federal and state grants. According to Councilmember Harmon, this type of housing is extremely difficult to operate in the first place. With rent so low, landlords often struggle with ongoing costs like maintenance, administration and insurance.
These are the city’s most affordable units, with price controls baked into the deed of the unit. Therefore, according to Harmon, these housing projects run on “incredibly thin margins.” If a project can’t cover its operating costs, it won’t be able to provide housing at all.
“To mess with that delicate balance is to undermine what everyone’s goal here really is,” Harmon said. “To change the balance of these projects in any way essentially dooms them.”
Harmon also said that Capital A affordable housing is a smart investment— it is built on city loans that have repayment schedules. This money is then used to fund the next project. For these reasons, Harmon believes this specific housing should continue to operate separately from the rent stabilization ordinance.
The other exemption Harmon stayed stern on was for low-income housing provided through Section 8 vouchers. These federally distributed vouchers allow tenants to only pay a percentage of their rent, while the rest is subsidized by the government. However, landlords rarely accept tenants on these vouchers because they come with a “wild amount of federal oversight and bureaucracy,” according to Harmon.
If the rent stabilization ordinance was added on top of the federal bureaucracy, Harmon said landlords would be disincentivised to accept Section 8 tenants.
“The reason I’m passionate about it is because these tenants can’t afford $4,000 a month whether or not the rent stabilization ordinance is passed or not,” Harmon said. “The loss of Section 8 is a direct pipeline to homelessness.”
At around 8 p.m., the meeting adjourned, and the rent stabilization ordinance was pushed ahead with a few changes. In a first motion, the council approved the ordinance with some changes to language, restricting the collection of personal information about tenants and requiring that one member of the new rent stabilization board must be a senior tenant. It passed, with Mayor Randy Rowse and council members Eric Friedman and Mike Jordan opposed.
The second motion okayed the exemptions, with Mayor Randy Rowse and council members Santamaria and Gutierrez opposed.
“I think we need to move forward now,” Harmon said at the meeting. “I’m missing something in the conversation to delay this, we’ve had months of urgency.”
