Guest Opinion | Paul Little: Council, Consider Total Costs to City and Taxpayers Before Deciding to Adopt Ordinance Absorbing Rental Board as City Department

The Pasadena City Council is deciding whether or not to approve an ordinance incorporating the Pasadena Rental Housing Board as a department of the City of Pasadena. Within that ordinance will be the terms and conditions the proposed adoption would involve and require. 

This is a complex and potentially very costly merger. Costs that could fall to Pasadena and its taxpayers to absorb.

I am hopeful the Mayor and City Council will give serious consideration to this effort. There are many intricate legal and financial aspects that should be taken into account.

First, I think it is important the will of the voters be closely adhered to. Voters in Pasadena approved an independent and self-sustaining Pasadena Rental Housing Board under Measure H. Yes, other cities with rent control boards have those integrated into their city government, but those were not approved as amendments to their city charter. Pasadena’s charter now clearly states that the Pasadena Rental Housing Board shall be independent of the City and City control. The proposal before the City Council says the staff of the Housing Board will be subject to hiring and firing by the City Manager. That is not independent.

There may be very significant costs associated with creating another City department (or sub-department). There are personnel costs, benefit and burden (health insurance, retirement benefits, etc.) costs and other potential liabilities. Will the Pasadena Rental Housing Board indemnify the city against any and all claims arising as a result of those employees’ performance or by those employees themselves under the proposal? Or will those costs ultimately fall to the City of Pasadena (and Pasadena taxpayers).

Incorporating the Pasadena Rental Housing Board as a City department (or sub-department) may open the City up to potential litigation and significant costs that would otherwise be the responsibility of the Housing Board. Will the Board indemnify the City against any litigation that results from the implementation of Measure H? Will the housing board bear all legal costs? Will they cover any potential costs resulting from lost litigation?

I can envision many potential avenues of litigation that will seek to have Measure H invalidated once property owners start receiving bills for costs imposed by the Pasadena Rental Housing Board. If the measure is invalidated, or part (or all) of it is thrown out and some (or all) of the employees are no longer required or allowed, what will happen to them? Who will bear any costs associated with severing them from City employment?

If Measure H is invalidated based on any number of legal principles that will be litigated once rental property owners start getting assessments to cover Rental Housing Board costs, will the City be responsible for any or all of the costs associated with litigation or legal determinations?

Will the members of the Pasadena Rental Housing Board also be employees of the City of Pasadena? Will they be subject to the same benefits as regular City employees such as health coverage and enrollment in the Public Employee Retirement System? Measure H did not envision paying housing board members more than the already very significant stipend called out in the charter amendment.

I strongly urge the Pasadena City Council to ensure that taxpayer money, that is City of Pasadena funds of any kind, does not subsidize, support or pay for any of the costs incurred by the Pasadena Rental Housing Board or staff associated with implementing Measure H. The City of Pasadena and its residents and taxpayers do not need an additional financial burden. The City Charter defines the rights and responsibilities of the Pasadena Rental Housing Board. Those right and responsibilities also include any financial or legal liabilities.

The Pasadena Chamber of Commerce Board of Directors, and myself personally, did not support passage of Measure H. However, since it has passed and is being implemented, I think it is important that the City of Pasadena follow the will of the voters and maintain an independent and self-sustaining Pasadena Rental Housing Board. That is what was approved by the voters as an amendment to the City Charter.

Paul Little is a former member of the Pasadena City Council and currently serves as president and chief executive officer of the Pasadena Chamber of Commerce and Civic Association.