City Council 5/7/24 Preview – Raider Nation, Eviction Investigation and Cannabis Loose Ends

This week’s agenda is somewhat light on streets, parks and housing, though there are a few interesting tidbits here and there.

First, it will again be dominated by the cannabis conversation, though hopefully this will be the last time we see the cannabis ordinance refresh get discussed at the Council level. Staff has again put the second reading of the cannabis ordinance in the consent calendar, this time without the language requiring all “financial interest holders” in a cannabis business to get a Costa Mesa business license that gave the industry such heartburn last time. And if that isn’t enough cannabis for you, hop over to the public hearing items to take a look at the City Council’s re-litigation of the proposed cannabis storefront at 2490 Newport Boulevard, which squeaked through the Planning Commission on a 3-2 vote. And if you STILL HAVEN’T HAD ENOUGH, hang around for the discussion of the cannabis badge fees the first item of old business.

But if all this cannabis talk doesn’t light your blunt, then there are at least three other interesting items on the agenda:

Raider Nation coming to Costa Mesa?!

I’ll admit I did a double-take when I flipped through the agenda and saw that the NFL Raiders were looking to use Jack Hammett for part of its summer training camp this year. I skimmed the contract and it seemed like mostly upside; we get a healthy $165,000 in use fees as well as some nice benefits thrown the city in the form of free tickets to summer league games, a $10,000 donation to a local youth sports group and refurbishment of the Costa Mesa High School weight room. And of course that’s on top of any incidental economic benefits we might enjoy from having a professional sports team hang out for a few weeks.

But what I thought was a little odd was that the (very short) Agenda Report doesn’t say anything about the city’s experience with the Chargers. As some of you might recall, the Chargers have been using Jack Hammett for several years as its summer training camp location, though they discontinued that relationship this year as its permanent off-season headquarters opened elsewhere. So… how’d the city do when the Chargers were in town? Did we feel like we got full value for that team’s use of our fields? Were our youth sports programs adversely affected by taking so many fields offline over the summer, especially when you take into account set-up and take-down time? Did it help our economy in any measurable way? I have no idea. And I would think answering those questions would be material to the Council’s decision to invite another NFL team to our city.

Fortunately (or unfortunately for Raiders fans), it is only a one-year contract, so if it is a bad idea the damage will be somewhat minimal. The Chargers were scheduled to be here anyway until 2026 before they ended their residency a couple of years early. So really this just fills in one of the last years of the original deal with a different NFL team.

The Pedestrian Master Plan finally makes it to City Council

This thing first got funded in 2020. Now, four years later, it’s finally come before the City Council. I won’t belabor this one as I already said my piece when the Pedestrian Master Plan went before the Planning Commission about a month and a half ago. Instead I’ll just re-emphasize one point, which is that this is a golden opportunity for the City Council to rectify a mistake made by prior, more timid Councils, which was to uniquely frame active transportation goals as recommendations rather than policies:

So could someone explain to me why active transportation, and only active transportation, must be flexible — and maximally so! — while policies relating to all other modes of transportation may be, by implication, inflexible and non-negotiable? Actually, don’t answer that, because I will. The answer is that prior administrations were afraid that adopting actual policies that supported active transportation would be considered too radical or too granola, without evidence beyond their own preferences and intuitions as far as I can tell, and so they copped out and incorporated the Active Transportation Plan (and now the PMP) into the Circulation Element as second-class policies.

So let’s dispense with the kabuki and just eliminate the “recommendation” terminology. The Active Transportation Committee (formerly the Bikeway and Walkability Committee) was formed nine years ago. If the City Council is committed to active transportation, it’s time to decide and say so.

So… how’s that evictio– I mean, “tenant protection” ordinance going?

The last interesting item on the agenda is a report on the city’s progress enforcing the anti-eviction ordinance it passed last Fall. If you take the Staff’s word for it, everything is going swimmingly. The number of no-fault evictions are substantially down compared to the pre-ordinance period! (never mind that landlords almost certainly rushed to evict tenants in anticipation of the ordinance passing). The Staff is intervening and successfully defending tenants subjected to “non-compliant” no fault evictions! Mission Accomplished!

But honestly… the report leaves open a lot of questions. For one, while the agenda report makes it sound like compliant no-fault evictions are happening, it doesn’t say whether tenants are getting their entitled compensation (one-month’s fair market rent). It does say that one family got $500 from the city towards moving and other expenses. But why are so few tenants taking advantage of our financial assistance programs? Is there something wrong with our bureaucratic intake procedures?

Also, what have we learned so far in the first six months of operating this ordinance? The agenda report mentions, in a way that reads more like a drive-by than an off-hand remark, that “adoption of the Ordinance has shed light on the disproportionate number of Costa Mesa households with minor children negatively affected by no-fault evictions.” There is no elaboration on what is meant by this remarkable statement. What does “disproportionate number” mean — disproportionate to what? Does the Staff mean to imply that it has evidence that landlords are intentionally discriminating against households with minor children? That would be a Fair Housing violation at the very least. Are we looking into that?

Another big hole in the agenda report is that it is devoid of any research about the possible negative effects of this ordinance on the population it intends to serve. When I wrote about the eviction ordinance at the time, I was (and am) very concerned that, when you push the heavy hand of regulation into a new area, it may result in unintended consequences. I linked this piece before but I think it’s worth highlighting it again now: landlords are small business owners, and they will not just sit there and eat risk up to their last dollar of profit. They will actively look to “de-risk” by — you guessed it — refusing to take on marginal tenants or finding ways around the ordinance’s requirements.

For example, if the eviction ordinance is making it harder to move along good and bad tenants alike, it’s possible that landlords might mitigate this risk by increasing security deposits and making tenant screening procedures more stringent. Are they? If they are, that’s going to make it very hard for our marginal renter population to find new homes when they need them. Additionally, if landlords don’t view our process as being as “streamlined” as the Staff touts, that could lead them to defer maintenance and rely on the constructive eviction of living with a backed up toilet, a malfunctioning stove and spotty A/C. Do we have any idea if this is, or will, occur? Nobody knows. Well, somebody knows; the tenants experiencing this very unpleasant way around the rules certainly know. But have we asked?

Additionally, completely absent from the report is any feedback from the landlords about the program. And that’s weird, since I would think good policy would ask whether the subject of a regulation is given a reasonable opportunity to comply in the first place. Did we survey landlords to see if they agree that the Staff has put in place “a streamlined process for the review of no-fault eviction notices”? I would imagine that good landlords would be eager to give feedback about whether it was easy to comply with our rules or not. If we’ve received any feedback, has it been positive? Negative? Anything? Recall that the Staff proudly touted the “notice” requirement as being a novel approach to this problem. So… do we have any curiosity at all about whether this “novel” approach is workable so far?

And finally, I think we should be monitoring what the multifamily investment market looks like, though clearly we are not. What I mean by “the market” is whether we are seeing small landlord consolidation, especially by larger investors with professionalized management companies. One of the reasons Costa Mesa’s rents have historically lagged behind its neighbors is because we have a fragmented rental ecosystem populated mainly by mom & pop landlords. These landlords absolutely can be scofflaws and scumbags but they are also far more likely to give tenants a break. Compare that to impersonal mega-property management companies that handle hundreds or maybe even thousands of properties. These guys invest in eviction software to automatically serve tenants with eviction notices for being a minute late with the rent and have plenty of high powered attorneys to aggressively manage out every case. Is encouraging our mom & pops to sell out — or even just to outsource management — to these kinds of outfits en masse in the best interest of renter population?

Can you tell I’m a little frustrated? Can we at least pretend to be curious about the problem our regulations are purporting to solve? These cheerleading agenda reports just don’t cut it. In a just world the City Council would grill Nate Robbins fiercely on this. But I’m not holding my breath. This item is near the back of the agenda and I’m sure the Council will be wrung out and exhausted by this point. So instead, I expect a pro forma receive and file.

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