CAA backs Palo Alto staff move to shelve rent control effort

Palo Alto city staff are recommending the city defer work on a local rent control ordinance, citing stable rents and the steep cost of standing up a new program.

Administering a local ordinance would run an estimated $2 million per year and require five new city employees, staff report.

The California Apartment Association supports the recommendation and is urging housing providers to weigh in before a key committee vote on Tuesday, March 10.

The recommendation will go before the Policy and Services Committee, a subcommittee of the City Council, on that date. Staff are also recommending the city defer a proposed expansion of the rental registry to properties with two or fewer rental units. Palo Alto does not currently have rent control.

Reviewing the first year of rental registry data, city staff concluded it "does not appear to demonstrate a pattern of widespread, acute rent increases that would warrant standing up a new local regulatory program." Key findings from the registry include:

• Nearly two-thirds of market-rate units - 62.85% - reported no change in rent over the past year
• Only about 11% of units saw rent increases above 5%
• The vacancy rate, based on data provided by property owners, stands at 5.21%

CAA opposes local rent control as a matter of sound housing policy, and the cost of the program for Palo Alto, paired with the city's current fiscal constraints, adds further reason to reject the effort.