A moratorium prohibiting apartment rent increases of more than 3.2 percent in East Palo Alto through June 30 was approved unanimously tonight (Tuesday) by the East Palo Alto City Council -- reversing a failure to enact such a moratorium last week.
The action was passed 5-0 as an urgency ordinance that takes effect immediately.
The legality of the action, however, was questioned by Page Mill Properties, the company that triggered its consideration by notifying hundreds of tenants in its 1,600 apartments of rent increases would take effect Feb. 1 that exceed 3.2 percent -- the current increase allowed by the city's Rent Stabilization Board. Many of the increases were to be 15 percent or higher.
"There is a question of sufficient notice for an urgency ordinance," Chris Griffith, attorney for Page Mill Properties, said.
State law requires 72-hour notice of agenda items, and the rent moratorium was listed on tonight's agenda as a normal ordinance, to take effect in 30 days, not an urgency ordinance. The council failed to pass an urgency rent moratorium Jan. 3 on a 3-0-1 vote, with Councilman David Woods absent and Councilman Peter Evans abstaining. Four votes are required for such an ordinance.
Evans, who said he wouldn't vote for an urgency ordinance last week because it would trigger a lawsuit from Page Mill Properties, voted for it tonight, as did Woods.
The rent moratorium is almost certain to end up in court, City Attorney Michael Lawson said. "In all likelihood, Page Mill Properties will sue the city and we'll see them in court," he said.
Griffiths claimed last week that the proposed rent moratorium would be illegal because of the way the city is enforcing its rent-stabilization ordinance in calculating the maximum allowed rent increases each year.
Now, the company may also challenge whether the action tonight was properly noticed under state law.
Woods, who was absent last week, said it was critical that the city take emergency action before the Page Mill Properties Feb. 1 rent increases go into effect.
He said he hoped the city and Page Mill Properties will "now sit down and work it out," regarding the different interpretations of the city's rent regulations.