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Cover Story : A House Divided in Santa Monica : City's Rebuilding Effort Seeks Delicate Balance, but Renters and Landlords Feel Like Losers

March 17, 1994|NANCY HILL-HOLTZMAN | TIMES STAFF WRITER

Despite a cacophony of construction sounds emanating from every corner of town, neither landlords nor their dispossessed tenants have anything to celebrate on this two-month anniversary of the quake that shook up Santa Monica in a big way.

The gloom is understandable: Anxious Santa Monica apartment owners wonder if money will be available for rebuilding as thousands of tenants scattered to the winds wonder if they will have a home to return to--at any price.

Since the Jan. 17 earthquake, the Rent Board and City Council have enacted, or are about to enact, elements of a rebuilding program meant to encourage property owners to repair or replace the nearly 2,000 apartments lost in the temblor, while retaining affordable housing. The rules have relaxed zoning and, to the dismay of renters, may lead to significant rent increases because the city has allowed landlords to pass repair costs on to tenants as a permanent rent increase.

For places beyond repair, the City Council agreed to throw its slow-growth zoning standards to the wind by allowing new apartment buildings to be the same size as before. They don't even have to provide on-site parking.

"The city is really giving up a lot in order to encourage rebuilding," said Planning Director Suzanne Frick.

The new policies may seem a relaxation of the Rent Board's ironfisted rules that helped gain the city the sobriquet Soviet Monica. But landlords do not feel they have reaped a bonanza. They question the math of the city's proposals and predict rebuilding won't pencil out, even for many of those fortunate enough to have that as an option. An unknown number of apartment owners expect to lose their buildings to foreclosure because they won't qualify for loans.

Meanwhile, the city's dominant rent-control political group is showing signs of structural stress, too, its future measured in part by how many of the uninhabitable apartment units will be restored--and when. The units represent a small portion of rent-controlled apartments, although in a city in which a few hundred votes often decide who is elected to the City Council, each is valuable to tenants and politicians.

Further clouding the issue is a renewed threat to rent control from Sacramento. A bill concerning other rent control issues was amended last week in the state Assembly to include a provision that would gut Santa Monica's tough tenant regulations by allowing rents to be raised to market levels upon vacancy.

At stake is the future of what is arguably the nation's toughest rent-control law, which has remained in place for 15 years despite numerous attempts to weaken it.

The rent control law was adopted following a battle over wildly escalating rents in the beach community. The law became the foundation of a political dynasty that now holds five of the seven seats on the City Council, controls the school board and is essential to the success of state legislators who represent the city.

Thus it was no easy feat for the Rent Board and the City Council to do what does not come naturally for them--allowing rents to rise in the quake's aftermath and wooing landlords.

The city officials "have a horrible, horrible dilemma," said Steve Little, vice president of First Federal Bank, a locally based lender. "They want to put as many people back in those buildings as possible."

Scared, angry, aghast at the prospect of higher rents and sad to be away from home, the displaced tenants are mostly absent from the dialogue, too preoccupied with finding new shelter and getting their belongings from unsafe buildings to show up in force at the endless public meetings since the earthquake.

Their outcry is expected to peak when individual rent increases and the permanent loss of units sink in. "Nobody understands the implications of the decisions," said renter John Bodin, who ran his political consulting business from the now red-tagged Sea Castle, where tenants had an ocean view for as little as $500 a month. "The Rent Board may not understand the financial ramifications, let alone a displaced tenant."

One of those who did attend a public meeting, longtime renter Sylvia Schniad, said she understood only too well that the new regulations were the death knell of rent control and "would change for all time the face and the character of Santa Monica."

*

Actually, the face of the city was changed on Jan. 17 at 4:31 a.m.

Everyone has conceded that affordable housing will be lost because of the earthquake. The question is how much.

Asked if he thought 500 affordable units was a fair estimate of what would be gone forever, Rent Board attorney Anthony Trendacosta said, "If ultimately, at the end of rebuilding, 500 units is all that's lost . . . we've done wonders."

Rebuilding in Santa Monica is particularly tricky.

A tour of the city the day before the earthquake would have shown a pastiche of apartment building styles ranging from the elegant Art Deco of the '20s to the slapdash stucco of the '70s.

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