Capitola City Council Votes To Repeal Rent Control

The Capitola City Council voted to repeal the city's 32-year-old rent control ordinance in front of a packed house at a meeting Thursday. After hearing two hours of pleas from residents of the Surf And Sand Mobile Park to keep the ordinance in place, they passed the proposal recommended by the City Manager Jamie Goldstein by a three to one vote.

The repeal is seen as a way to end a prolonged legal battle against Surf and Sand owner Ron Reed over his attempts to raise rents on tenants lots.

Councilmember Stephanie Harlan was the sole vote in favor of maintaining the ordinance.

“I am not going to support this because I don't think we need this right now at all,” Harlan said. “I can't vote to repeal rent control, I have just been too much a part of it, that I couldn't do it.”

Councilmember Kirby Nicol moved to approve the repeal after saying that he is against any form of price controls by government because he they lead to lawsuits from either residents or property owners.

Residents and the city have already spent more than $1 million fighting Reed's attempts to get out of rent control. Before Nicol made a motion to vote, he referred to the concept of rent control as “a failed social experiment.”

“I would not have voted for rent control in 1979...I don't believe price controls have any place in a free society, because I think they always lead to pain and suffering,” he said. “And the people hurt most are the proposed beneficiaries.”

Resident Davina Baker said Reed has refused to sign a form necessary to renew her Section 8 housing voucher until she signs a lease that will raise the rent on her lot from $300 to $2,500 per month. Her voucher expires in six weeks, and allowing it to lapse will land her on a waiting list at least five years long.

Phillip Crawford, an attorney representing several residents, said the city made a mistake by stating publicly their $1 million limit for legal fees to assist residents against Hart, King and Coldren (HKC) — the law firm representing Reed in his bid to raise rents. They represent property owners across the nation who are intent on bypassing rent control ordinances for a variety of reasons. Their website includes stories like a case in Santa Clarita where they were "able to persuade [city officials] to not only disregard the recommendation of the consultants, but to stand up to to overwhelming opposition by the park residents."

“You're being bullied by people with larger pockets into giving up,” Crawford told the council. “The moment you said you had a limit is when they decided to pile up the paperwork.”

Micheal Termini voted to repeal the ordinance, but not before making clear he doesn't trust Ron Reed as a person. He also assured the residents of Pacific Cove Mobile Home Park, which is owned by the city, that nothing will change for them after rent control is repealed.

“The bad news is I am going to vote for this ordinance, but this is the first read,” he said. “When we do an ordinance, nothing happens. Then we vote on it again in 30 days, and if it isn't repealed, it goes into effect.”

Termini said he wants to see a “census” of residents' incomes, and the leases they have been offered in the next two weeks before he votes on the final proposal in in September.