President's Message

The Boy Who Cried Wolf

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If you have heard it once, you have heard it a thousand times. It is a little like the boy who cried wolf. The same message, the same threat and after a period of time it wears thin. The Call To Action just seems to lose its impact. However, at the risk of repetition I am compelled to tell you that this threat is not only real, but they are organized and ready to pull the Rent Control trigger.

I attended a recent Long Beach City Council meeting and the agenda included discussion about the recently enacted PRHIP ordinance. In addition, there was talk among the audience about fears of a possible REAP ordinance and rent control. When the meeting was over and I was walking to my car, the immortal words of Greta Garbo popped into my mind—"I want to be alone." I think Greta was trying to say that she wanted people to leave her alone, and I found myself wishing that the City Council, the housing inspectors and the groups trying to pit tenants against landlords, would just leave us alone. Of course—that will never happen! Now that I'm over the fantasy, I'll tell you what we must do.

We must work like we've never worked before to protect our businesses and our rights.

The AACSC does many things to defend our industry including local lobbying, state level lobbying, communicating with and updating our members on important issues, but we should be doing more and we'd like you to be more involved.

In that regard, we plan to set up a new committee, different that the committees that we have set up in the past. We're calling it the Special Committee for Long Beach Legislation. It will consist of a group that includes AACSC members, nonmembers, AACSC board members, property management groups, major property owners and other influencers who understand the importance of our mission.

Initially, we will be assessing how real the various threats are and when they might be coming our way.

We'll develop a list of actions:

• How to counter negative legislation,
• Identify people or groups that we can align with and collaborate.
• How best to get the word out to ALL owners, landlords, management companies.

We know this threat is real, and we also know we cannot do this in a vacuum. Your involvement in this very important movement is critical. Please contact us at AACSC to get involved. We will be announcing future meetings through our website, in our AACSC Beacon Newsletter delivered to your e-mail every Tuesday and in the Apartment Journal magazine. If protecting your rental business is important to you, please join us!

Be sure to attend the Annual Membership Meeting on October 27th at the Petroleum Club, 7:00 p.m. where we will be updating you on new laws, new forms and electing our new Board Members.

A Personal Story

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While on a Southwest flight recently, I had the good fortune to sit next to Josephine. She is 76 years young, impeccably dressed and looking forward to seeing her relatives in Brevard, North Carolina, for the first time in many years. She told me she can’t really travel much any more — doctor’s orders. She needs a walker to get around, has rheumatoid arthritis, diabetes and takes over 50 medications every day, but she decided to ignore the doctor this one time. The lady has a lot of courage and the gift of gab. She talked for most of the four-hour flight. One of the earliest female graduates of Fisk University, she had a business career, met and married, and survives a wonderful handsome husband. She had a child of her own but lost him a few years ago. She adopted two children and until recently was raising one of her grandchildren. She had her smart phone out the whole time sharing apps she likes and many family photos. It would be hard not to like this lady.

We also found out that we live about ten minutes from each other. Josephine rents a comfortable one-bedroom apartment in Bixby Knolls for $825 per month. I let her know that I thought her rent was extremely reasonable, and she agreed. She said that when she moved in four years ago, she explained to her landlord that she was on a fixed income and didn’t want her rent going up. “The landlord has never raised the rent,” she exclaimed.

In Long Beach, and most surrounding cities, market forces and personal decisions about what to charge for rent give housing providers a lot of latitude. Josephine’s rent was below market for sure, but was she getting a steal by accident? I don’t think so. There are many ways to help people in need. Americans are famous for donating money and supplies to people in crisis. We donate to charities like the United Way or the Salvation Army. We can even choose to keep our rents below market for people like Josephine as a way to donate on a more personal level.

You have the flexibility to do that in a free market if you choose to. Don’t expect that in a heavily regulated market, however. Cities like Los Angeles, West Hollywood and Santa Monica heavily regulate the rental housing industry. That regulation gives incentive and really forces housing providers to raise rents as much as possible. It should be no surprise then that rents in those cities are some of the highest anywhere, and the poor families are slowly getting squeezed out. We’re not there yet in the cities served by AACSC. Let’s keep it that way.

City Hall

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These are interesting political times we are living in. A lot of local elections have been decided already and the National elections finish things up in November. Our new representatives will want to make a positive impact on the lives of their constituents. In order to help them understand what’s important to us and what will fairly benefit everyone, it is up to us to deliver the message as to how we feel about issues that affect us.

For AACSC members, that means sharing information related to the rental housing industry. You may not realize it yet, but there are determined groups in our community that feel that the best way to manage your property is to get local elected officials to enact layer upon layer of suffocating legislation to burden thousands of small apartment owners. They’ll package their recommendations to government in happy sounding wrappers like: Community Benefits Agreement or Renters Right to Know.

Other communities near us have heaped these types of ordinances onto our fellow housing providers with terrible results for—surprise—our tenants! I feel so bad for low income tenants in Los Angeles and Santa Monica where, for example, a myriad of local ordinances in those cities have pushed rents to sky high levels. Housing providers are forced to underprice their units. Without the money to afford normal upkeep, tenants stay living in substandard conditions. These groups can’t explain why builders aren’t building more low income housing. If they knew the value of “incentive”, they would understand.

So are you comfortable allowing your business and your tenants to be legislated into such a negative world? I hope not! The lower rents and better quality of housing that our AACSC housing providers deliver can be directly attributed to the lower level of legislation we work with, but that doesn’t happen by accident. AACSC is doing all it can to help protect your interests, but the coming wave of negative proposals that will be presented to our elected officials will need to be countered by a bigger group. That means we need your help more than ever. We need you to be at City Hall in large numbers when rental housing issues are being discussed. We need you when it’s important to make calls to our representatives. It’s never been more important and we’ve never needed each other more.

On a brighter note and one we are all excited about—Ed Begley, Jr., is going to be the guest speaker at our luncheon during the AACSC Trade Show on September 15. One of the most well known advocates of green living, Ed Begley has made it his mission to help us all live in a way that is less harmful to our environment and in a manner that future generations will applaud us for. This is a can’t-miss event and has already created so much buzz that I would strongly recommend that you purchase your tickets well in advance. See you at the Trade Show!

Important State Level Victories

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How’s your summer going so far? Summers were the best when I was growing up. There was no school, fun vacations and not a care in the world. I wish I hadn’t taken those days for granted years ago because things have changed a lot as the years have gone by!

AACSC’s staff, Board and Lobbyist have had their hands full dealing with proposed burdensome legislation this summer. Remember, AACSC puts your membership dues to work to help prevent caustic proposed legislation from getting signed into law. We’ve recently secured a couple of important victories on a State level. The first was getting a proposed bill killed that would have permitted local governments to adopt and enforce ordinances that could require price con trol mandates on new rental housing developments. One of its features would have prohibited property owners from setting rental rates for the new units. If you ran a city and wanted to make sure no developer would have incentive to build new rental housing, this would be the kind of legislation you’d come up with.

The second proposed bill that was thwarted would have forced rental property owners to participate involuntarily in the federal Section 8 Housing Voucher program. The Section 8 program is a good program even though it has some flaws and many landlords embrace it and build their businesses to accept it; but Section 8 is not right for all housing providers and in many cases could be ruinous because of the possibility of long periods of interrupted rental income. There are much better ways to make Section 8 more widely accepted including improving the program’s terms and con ditions. Unfortunately, this defeated bill was an example of a lazy approach by government to ram a sometimes flawed program down the throats of all housing providers. That’s no way to govern and there’s got to be a better way. They could start by initiating a conversation that includes housing providers, fix some of Section 8’s flaws and create incentives to build more low income housing where the vouchers could be accepted. It would take some work, but we’d have a lot better chance of a successful outcome that everyone could embrace. I can’t emphasize how important you, our members, are to these successful efforts. It really does take work from all of us. Thank you for the phone calls to your State representatives. Thank you for your financial contributions from your membership dues to your donations to the PAC. We truly have a team effort and it is much appreciated.

We sure have done some hard work so far this year so why don’t we all take a break and besides celebrating Independence Day on July 4th, join us to celebrate our accomplishments at the AACSC Summer Social!! It’s on Thursday, July 21st from 4:30pm to 7:30pm at the Hotel Maya, 700 Queensway Drive in Long Beach. I also think it would be a great idea to use the opportunity to invite our friends who aren’t members yet to register and come out and meet their fellow housing providers and talk about the important work we all do. Please register as many friends as you’d like and then help us get them to join AACSC!

State Legislation Day

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On March 29th and 30th, a delegation of members of AACSC will be in Sacramento to meet with our State Legislators and share with them what we believe will be reasonable legislation to consider for the coming year. I would like to personally invite you to join us. In case you are wondering if your presence will make a difference, I can assure you that it will. If you come and would like to speak directly with an elected official regarding one of the bills that AACSC is focusing on, we are planning to make as many of those opportunities available as we can.

The National Apartment Association is holding its annual Education Conference the week of June 13th in San Francisco. I attended last year's Conference in Las Vegas and was extremely impressed with the learning sessions that I attended, the networking opportunities, the chance to talk to fellow landlords or vendors about their experiences and best practices. Registration has begun and I was one of the first to sign up. It will be a great event. One more thought - would you be willing to donate four hours of your time at the NAA Conference in exchange for a 70 percent discount on your registration fee? Register as a volunteer and you'll get that amazing deal!

Finally, is there anyone reading this who owns real estate but doesn't have their property insured because they don't think insurance is important? Kind of a silly question isn't it? So, how many of you, who do carry insurance on your apartments, also require that your tenants carry renters insurance? If you don't, don't you think that's silly? Here are some reasons why: if the upstairs tenant floods the downstairs unit, his renters insurance pays first in most cases, not yours (especially when the responsible tenant is liable for the damage). If the tenant’s dog bites someone on the property, his renters insurance pays first, not yours. If the property burns down and your tenant’s possessions are destroyed, the tenant suffers a complete loss without insurance and your policy won't help even though I'm sure you will be blamed and there will be an expectation that you will somehow make them whole. Don't fall into this trap. Do your tenants a favor and require renters insurance. Please direct your tenants to research their options through www.psiquotes.com/aacsc. If they do their shopping through this site, then you will benefit, your tenants will benefit, and AACSC will benefit.

 

 

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