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18629 | Approved Minutes January 24, 2017 spent on mediation and focus more time on questions and determining the Committee's decision. He reiterated that Committee members are not professional mediators. Staff explained the Program Administrator's role in processing rent increase submission through the scheduling of the rent increase review before the RRAC. The Committee recommended that mediation and the RRAC process be defined in the Ordinance. Additionally, the Committee recommended that optional mediation prior to the RRAC meeting be encouraged. 2. Should rent increase criterion from Section 6-58.125 be included in the Committee's criteria when deciding a rent increase? Member Friedman listed the criteria in Section 6-58.85 (B) under consideration by the Committee in determining rent increases. He stated that "just and reasonable rate of return" should be more clearly defined and that market rate should not be included in the Committee's consideration. He suggested adding "maintenance of Net Operating Income for the Base Year as adjusted by inflation over time provides a Landlord with a just and reasonable rate of return on property" to the Committee's criteria. Member Schrader noted that the flexibility of the Committee's criteria is important; especially in cases when a landlord had not raised rent for many years. Member Griffiths agreed that more flexibility is better. Chair Sullivan-SariƱana stated that the Committee and the Hearing Officer play different roles. Hence, different criteria should be considered. No recommendation from the Committee. 3. Should 5% remain the threshold for a Landlord Request for Rent Review? Should increases of 5% or less receive a binding decision from the Committee? Chair Sullivan-SariƱana stated that 5% is an arbitrary threshold and has a significant impact on the negotiation. He expressed concern that this threshold limits discussion because many landlords expect at least a 5% increase. Staff clarified that tenants can contest rent increases of 5% or less by contacting the Program Administrator. Member Griffiths noted that many cities relate rent control to inflation. Member Schrader stated that the Bay Area's housing cost inflation is 4.8%. Member Schrader also noted that the 5% threshold affects what data is collected more than it affects whether or not a case comes before the Committee. Member Griffiths noted 5% is a good threshold because it captures large rent increases, rather than every increase. However, he expressed concern that the Committee has not seen a tenant-initiated case for several months. He raised concern that the tenant may not believe Page 3 of 7 |