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DRAFT FOR ATTORNEY REVIEW — NOT FINAL

Section 1803

Citation
Section 1803
Parent Document
1041 20TH St., LLC v. Santa Monica Rent Control Bd., 250 Cal. Rptr. 3d 376 (2019)
Jurisdiction
California (state)
Effective Date
2019-07-30

Full Text

2,029 chars
One purpose of the Rent Control Law is to provide consistency with constitutional requirements such as allowing landlords a fair return. (§ 1800.) To *390accomplish this purpose, the Board is empowered to adjust the rent ceiling and set rents at fair and equitable levels. (§ 1803(f)(4), (5).) Section 1805(c) allows a landlord to petition for an increase to the maximum allowable rent. Section 1805(e) provides that the Board may consider all relevant factors in determining its fair return formula, including: "increases or decreases in operating and maintenance expenses," "necessary and reasonable capital improvement of the controlled rental unit as distinguished from normal repair, replacement and maintenance," "substantial deterioration of the controlled rental unit other than as a result of ... wear and tear," "the landlord's rate of return on investment, the landlord's current and base date Net Operating Income, and any other factor deemed relevant by the Board in providing the *46landlord a fair return." Thus, the Rent Control Law as written does not deprive 20th Street Owner of receiving a constitutionally fair return. Furthermore, as City of Berkeley , supra , 27 Cal.App.4th 951, 33 Cal.Rptr.2d 317 held, any rent setting power "[is] expanded by the constitutional requirement that the Board provide landlords with a just and reasonable return on investment." ( Id. at p. 962, 33 Cal.Rptr.2d 317.) Because 20th Street Owner has not petitioned for an increase to the maximum allowable rent, any argument it will not receive a constitutionally fair return is not ripe for review. (See Pacific Legal Foundation v. California Coastal Com. (1982) 33 Cal.3d 158, 169, 188 Cal.Rptr. 104, 655 P.2d 306 ["a basic prerequisite to judicial review of administrative acts is the existence of a ripe controversy"].) Accordingly, 20th Street Owner's argument that the Board's, and this court's, interpretation of section 1803(t) will prevent it from receiving a constitutionally fair return is unavailing. IV. DISPOSITION