An association of apartment building owners has filed a lawsuit against Santa Ana, alleging that the Orange County city’s new rent control rules violate the U.S. Constitution and stacks the cards against property owners.
The suit filed in Orange County Superior Court on Feb. 14 marks the first time in the 61-year history of the Apartment Association of Orange County that it has sued a city where it operates, said John Tomlinson, the group’s president. He alleged that his association has been ignored by the Santa Ana City Council, which is dominated by progressive politicians. The council passed laws which marked Santa Ana as the first Orange County city to adopt rent control and eviction protections.
Santa Ana’s new rules specify the development of a seven-person rental board which will have the power to resolve landlord-tenant disputes outside of court. Santa Ana’s new laws also create a rental registry, which will serve as a database of city rentals and rent increases. For this registry, landlords will be required to enroll their units each year, then pay a fee for the registration.
The registration will help finance the program, yet fee amounts have not been determined, according to media reports. The registry is not active yet.
The apartment association criticized the city’s rent control rules as examples of government overreach.
“We tried repeatedly to work with the city to address these concerns prior to adoption,” Tomlinson said. “But the city refused to meet with us.”
The suit’s 13-page complaint alleges that Santa Ana’s rent control laws violate the 4th and 14th amendments of the U.S. Constitution.
The 14th Amendment contains the due process clause. The lawsuit claims that Santa Ana’s Rental Housing Board will be a quasi-judicial body, which is designed to favor tenants over landlords. “The rental housing board will not be a forum for fair adjudication of the petitions presented to it,”the lawsuit states.
The city’s rules for apartment rent controls also will not allow landlords a fair rate of return, the suit contends. Its price controls cap annual rent increases at a maximum of 3 percent, or 80 percent of the change in the consumer price index, whichever increase is less. The annual maximum rent increase is determined by the city, not landlords, the lawsuit states.
The suit also alleges that 4th amendment rules against unlawful search would be violated by the city’s requirement that landlords enroll their buildings in a rental registry.
City of Santa Ana has not answered the complaint, an apartment association representative said.
AAOC lawsuit’s argument that rent control provisions infringe on constitutional rights is not unique, said Niv Davidovich, managing partner of law firm Davidovich Stein Law Group, which focuses on representing developers and landlords. However, he sees challenges to landlords mounting their case in the current state political scene.
“A lot of these rent control ordinances are getting far more aggressive,” Davidovich said. “As they continue to get more aggressive, they inch closer to getting more unconstitutional.”
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