The City of Alameda contracted with SCI Consulting Group to conduct a study of county assessor data. SCI found that some 14,889 rental units may be subject to an annual program fee.
Direct and indirect labor costs, services, and supplies costs to run the program are estimated to be $1.95 million per year.
Dividing the cost by the number of units produces an annual fee of $131.
City staff are also recommending that property owners be permitted to pass 50 percent of the program fee on to tenants in equal installments over the course of twelve months. The program fee would not be included as rent when owners calculate a percentage increase.
Under the March ordinance, landlords or tenants can appeal a Rent Review Advisory Committee decision regarding increases above the five percent threshold.
SCI determined the cost of the appeals process to be $4,705, when factoring in a contracted hearing officer.
To discourage frivolous appeals, city staff is recommending that landlords be charged 10 percent of that cost ($471) to start an appeal, and tenants be charged five percent ($235).
The balance would be, in the words of the staff report, “apportioned to all the owners of the non-exempt rental units the following fiscal year when the actual costs of this part of the program are better known and the program fee is recalculated.”
City staffers recommend reviewing the fee after the first year of operation, and possibly adjusting the fee in accordance with the Consumer Price Index annually.
Assuming council approves the plan next week, the fee would become operative July 1, 2016.