The Santa Barbara Rental Property Association (SBRPA), represented by attorney Barry Cappello, is planning on taking legal action against the City of Santa Barbara in an attempt to invalidate the recently passed rent increase moratorium and put a stop to the planning for a permanent rent stabilization ordinance.
Cappello and SBRPA announced intentions to pursue legal action in a press conference at City Hall on Tuesday, launching an effort to “invalidate the freeze” on rent increases, which was approved by the City Council on January 13 and went into effect on February 26. The temporary moratorium was intended to hold rents at current rates while the city drafts a permanent citywide rent cap over the next few months.
SBRPA members contend that the temporary moratorium is “illegal” and represents an “unconstitutional taking” of private property. According to a statement provided to the media, SBRPA members said the rent freeze could be interpreted as “unlawfully interfering with private contracts,” and further “deprives landlords of a fair market return on investments.”
“Wrapped in the language of ‘rent stabilization,’ the proposals directly violate established law, ignore economic reality, and mislead tenant advocacy groups into believing the city has authority it simply does not possess,” the SBRPA statement read.
The SBRPA contends that the rent freeze and proposed rent stabilization program represent an unconstitutional taking and violate the due process and equal protection clauses, as well as unlawfully interfering with private contracts prohibited by the Contracts Clause.
The group retained Cappello, a former city attorney and managing partner of Cappello & Noël, to help challenge the city’s temporary rent increase moratorium. According to Cappello, SBRPA intends to pursue the legal process “through to the end and make sure either the city council rights this wrong or a court with proper jurisdiction orders it stricken.”
“Rising taxes, insurance, and maintenance costs are hitting property owners hard,” Cappello said. “Rent stabilization is bad economics. Owners need a return on their investment even as costs rise and must keep their property in a first-rate and safe condition. Rent control has proven over the years that when housing stock is not maintained, housing conditions for the tenants worsen.”
No legal action has been filed at this time, but Cappello and SBRPA intend to file in the next few weeks. Check the Independent for continued coverage about the rent increase moratorium, including a detailed look at the new rules and regulations, and how they are impacting tenants and landlords on the ground.
