34,388 / 74.7% Yes votes ...... 11,654 / 25.3% No votes

See Also: Index of all Measures

Under current law, the formula for granting an annual adjustment of the base rent ceiling is established by the Rent Board after it conducts a study of rental housingrelated costs increases and obtains input from the public.

Financial Implications
The Rent Stabilization Board expects to save approximately $15,000 to $20,000 per year in economic consultant and administrative costs for preparing the cost study and conducting the public process that results in establishment of the Annual General Adjustment each year.

s/MANUELA ALBUQUERQUE, Berkeley City Attorney

Measure O was placed on the ballot by the unanimous vote of the City Council.

The last twenty years have seen a seemingly endless dispute between Berkeley tenants and property owners over the amount of the annual rent increase allowed for rent controlled housing units, known as the AGA. Measure O is the product of good faith negotiations between the Berkeley Rent Stabilization Board and the Berkeley Property Owners Association. It will end years of expensive litigation and eliminate the likelihood of more litigation over the AGA in the future.

Under Measure O, the AGA for each year will be set at 65% of the increase in the past year's Bay Area Consumer Price Index (CPI). This method is similar to the process used in San Francisco and other rent-control cities. The current AGA system requires the Rent Board to hire costly private consultants, analyze large quantities of operating cost data and conduct a series of public meetings before determining the amount of the AGA. This expensive process has been contentious, cumbersome and, over the years, has drawn criticism as well as lawsuits from both property owners and tenants.

Adoption of Measure O will streamline the AGA process, eliminate the annual rancor between the competing interests, and save tens of thousands of dollars a year in outside consultant and Legal costs.

Measure O is fair to everyone, reduces the cost of government and is supported by all sectors of the community.

Assemblymember Loni Hancock, Mayor Tom Bates, and Councilmembers Breland, Hawley, Maio, Olds, Shirek, Spring, Worthington, Wozniak and The League of Women Voters, all urge your YES vote for Measure O

s/TOM BATES, Mayor, City of Berkeley
s/BETTY OLDS, Councilmember
s/MAX ANDERSON, Chair, Berkeley Rent Stabilization Board
s/MICHAEL WILSON, individually and on behalf of, President, Berkeley Property Owners Association
s/SHERRY SMITH, individually and on behalf of, President, League of Women Voters of Berkeley, Albany & Emeryville

(No arguments against Measure O were submitted)

BE IT ORDAINED by the People of the City of Berkeley that Berkeley Municipal Code section 13.76.110 shall be amended as follows:
13.76.110 Annual general adjustment of rent ceilings.

A. Once each year, the board shall consider setting and adjusting Effective January 1 of each year, the rent ceiling for all rental units covered by this chapter for which the landlord did not establish an initial rent during the prior calendar year in general and/or particular categories of rental units covered by this chapter deemed appropriate by the board. shall be adjusted by 65% of the percentage increase in the Consumer Price Index for All Urban Consumers (CPI-U) in the San Francisco-Oakland-San Jose region as reported and published by the U.S. Department of Labor, Bureau of Labor Statistics, for the twelve month period ending the previous June 30. In determining the allowable percentage rent increase, numbers of .04 and below shall be rounded down to the nearest tenth decimal place and numbers of .05 and above shall be rounded up to the nearest tenth decimal place. In no event, however, shall the allowable annual adjustment be less than zero (0%) or greater than seven percent (7%). The board shall hold at least two public hearings prior to making any annual general adjustment of the rent ceilings. The board shall publish and publicize notices of the date, time, and place of the public hearings at least thirty days prior to the hearing date. The two required public hearings shall be conducted and the annual general adjustment shall be set between September 1 and on or about October 31st of each year. The annual adjustment shall become effective the following January 1.
B. In making annual general adjustments of the rent ceiling, the board shall:
1. Adjust the rent ceiling upward by granting those landlords who pay for utilities a utility adjustment for increases in the city of Berkeley for utilities.
2. Adjust the rent ceiling upward by granting landlords a property tax, maintenance and operating expense increase adjustment (exclusive of utilities) for increases in the city of Berkeley for property taxes and maintenance and operating expenses.
3. Adjust the rent ceiling downward by requiring landlords to decrease rents for any decreases in the city of Berkeley for property taxes.
4. Adjust the rent ceiling downward by requiring landlords who pay for utilities to decrease rents for any decreases in the city of Berkeley for utilities.
In adjusting rent ceilings under this subsection, the board shall adopt a formula or formulas of general application. This formula will be based upon the annual rent registration forms, surveys, information and testimonies, presented at public hearings, and other available data indicating increases or decreases in the expenses relating to the rental housing market in the city of Berkeley set forth in this subsection. For maintenance and operating expense adjustments, the board may also use survey data from surrounding communities where appropriate. The board shall make no more than one annual adjustment of rent ceilings per rental units per year.
Adoption of a formula greater than forty-five percent of the increase in the Consumer Price Index for the twelve months ending the previous June 30 shall require the affirmative vote of six commissioners, other provisions notwithstanding. Adoption of such a formula shall be a specific and special exception to the requirement of only five affirmative votes to make a decision. For the purposes of this subsection, the Consumer Price Index shall mean the Consumer Price Index for all urban consumers in San Francisco- Oakland, all items (1967 equals 100), as reported by the Bureau of Labor Statistics of the U.S. Department of Labor, as it pertains to the City of Berkeley.
C. An upward general adjustment in rent ceilings does not automatically provide for a rent increase. Allowable rent increases pursuant to a general upward adjustment shall become effective only after the landlord gives the tenant at least a thirty days written notice of such rent increase and the notice period expires.
D. If the board makes a downward general adjustment in the rent ceilings, landlords of rental units to which this adjustment applies shall give tenants of such rental units written notice of the rent decrease to which they are entitled. Such rent decreases shall take effect not later than thirty days after the effective date set by the board for the downward general adjustment.
E. C. If the maximum allowable rent specified under this chapter for a rental unit is greater than the rent speci- fied for such unit in the rental agreement, the lower rent specified in the rental agreement shall be the maximum allowable rent until the rental agreement expires. If the maximum allowable rent specified under this chapter for a rental unit is less than the rent specified for such unit in the rental agreement, the lower rent specified under this chapter shall be the maximum allowable rent.
F. D. No rent increase pursuant to an upward general adjustment of a rent ceiling shall be effective if the landlord:
1. Has continued to fail to comply, after order of the board, with any provisions of this chapter and/or orders or regulations issued thereunder, or
2. Has failed to bring the rental unit into compliance with the implied warranty of habitability, or
3. Has failed to make repairs as ordered by the housing inspection services of the City of Berkeley, or
4. Has failed to completely register by July 1, except as provided in Subsection G E. below.
G. E. The amount of an upward general adjustment for which a landlord shall be eligible shall decrease by ten percent per month for each month beyond October 1 for which the landlord fails to register.
H. F. A landlord who is ineligible to raise rents under an upward general adjustment for an entire calendar year shall not be eligible to raise rents under that particular general adjustment in future years.