On Monday night, the Palo Alto City Council approved an urgency ordinance that provides for relocation assistance for tenants when their buildings are being demolished or converted to another use.  The 7-1 vote, which met the required 4/5ths threshold required for an urgency ordinance, came after nearly three hours of public testimony and debate, and marked a shift in the Council’s engagement with tenant displacement issues after voting down proposals for rent restrictions and just cause eviction protections just last year.

The Council’s action was precipitated by the sale, and planned conversion to a luxury boutique hotel, of the 75- unit President Hotel Apartments in Downtown Palo Alto. The Council was nearly united in its support of the President’s tenants, even as dozens of landlords raised concerns about the relocation assistance and a parallel proposal to enact just cause eviction requirements.   Their concerns were countered by dozens of tenants, concerned local citizens, and advocacy organizations, including the Law Foundation Silicon Valley, Housing Trust Silicon Valley, and SV@Home, who all spoke to the importance of providing protections for the President’s tenants.

The emergency ordinance requires that landlords provide relocation assistance to renters being displaced who make less than 100% of the area median income (AMI).  While the ordinance applies to the residents of the President Hotel Apartments, it also will apply to any other structure with 50 or more units. The relocation payment was calculated by staff to cover first and last month’s rent, security deposit, and moving expenses. Under this calculation, the residents of the President Hotel Apartments  would receive between $7,000 and $9,000 in relocation assistance depending on the size of their current apartments. This amount is increased if the resident is a senior, has a dependent child, or has a disability. Several tenants expressed concerns that the amount was insufficient given the current housing market.

The approved motion contained both an emergency ordinance and an identical permanent ordinance.  While this was a very important step for the Council to take, and it was heartening to see broad support, it is clear that further discussion is necessary to craft a more comprehensive conversion and tenant protection ordinance for Palo Alto. Recognizing this fact, a number of members of the Council are preparing to present further reforms, and the issues are expected to come back at the next meeting on September 10th.

As the discussion continues, SV@Home will be seeking future changes to:

• Project size threshold. We urge the Council to consider expanding applicability of the ordinance to residential developments of 10 units or more – a threshold reflected in ordinances in neighboring jurisdictions.
• Conversion ordinance. We urge the Council to consider adopting a conversion ordinance to define a process and expectations prior to the conversion of multi-family residences from rental to ownership or from residential to non-residential uses.

We will keep you informed as details become available.

Palo Alto Online coverage here, and Mercury News coverage here.