More taxes for everyone, not just property owners

So at the Council meeting way back in July when the Council voted in favor of putting the police parcel tax (Measure NN) on the November ballot, District 2 Councilmember Pat Kernighan, who supported the tax, said that she would be introducing a proposal in the fall that would allow landlords to pass the cost of the new tax onto their tenants.

Kernighan’s proposal (PDF) will be considered tomorrow at the Community and Economic Development Committee meeting (PDF). In her letter to the City Council, she says:

It is estimated that 60% of Oakland residents are renters and 40% are homeowners. I have heard objections from some homeowners and residential property owners that they feel it is unfair that their neighbors who are renters get to vote to impose the tax, yet do not have to share the cost of it. To address that concern, I am offering this proposal, which is to allow owners of rental properties covered by the Rent Adjustment Ordinance to share half the cost of the Measure N tax with their tenants.

So, to be clear. If Measure NN (PDF) passes, property owners will be paying an extra $275.56 each year on single family homes and $188.26 per year on each unit in multi-unit properties. If the Council approves Kernighan’s pass-through, apartment dwellers in rent-controlled units will be on the hook for $94.13 each year to cover the cost of the 75 extra police officers and 105 extra police service technicians added by the tax.

I think this is only fair. Honestly, I’d be fairly surprised if Measure NN passed, but in general, I think that its healthy for the entire electorate to have some ownership of what they’re voting for. Permanent renters who never expect to have to actually cough up for taxes are a whole lot more likely to check the yes box. And since they never have to write that check, they’re just that much less likely to give a damn about accountability and efficiency in how the money actually gets spent.

My big concern about Kernighan’s proposal is one of public awareness at this late date. The Council won’t pass this until October 21st, only two weeks before the election. Absentee ballots have already gone out and people are already voting. Why couldn’t this have been introduced a month ago? It hardly seems fair to change the rules after the votes are cast. There are renters who have already made their choice on Measure NN under the assumption that they won’t be paying anything. There are property owners who have already made a decision based on a cost that’s actually twice what they’ll end up having to pay. And what kind of public education effort will the City engage in for the two weeks before election day if the pass-through is approved? People deserve to know what they’re voting for.

UPDATE: Kernighan’s proposal did not pass the Committee.

72 thoughts on “More taxes for everyone, not just property owners

  1. Patrick

    Not to mention, a parcel tax, in and of itself, is unfair. I am grateful for my small, 1920′s Spanish-esque home; it got me out of renting in SF, and I loved returning to homeownership. And, I could afford the parcel tax if it passed. However, how about those many thousands of homeowners who can’t afford it? My neighborhood is by no means “well off”, and to expect my struggling fellow citizens to pay the same amount per year as someone living in Montclair or Rockridge is ludicrous. I realize that Prop. 13 has severely limited government’s options regarding ad valorem taxation, but the parcel tax is not the answer.

  2. dto510

    Why does this apply only to Measure NN and not any current (Measure N) or future tax? I mean, it’s only fair for everyone to pay taxes, and I don’t see what makes NN unique.

  3. Peter

    this is my first glance at the proposal, but i don’t see it as fair. homeowners already have all sorts of crazy incentives and tax breaks – they’re homeowners, after all, and relatively rich. let them sell the properties if they don’t want to pay property tax. people should not be landlords anyways. buy your own house, stay there, be happy – don’t extract money from poor people.

    homeowners are making money in various ways every day they’re paid rent, not including the generally-rising value of their homes and properties. why all them to rip more money from working folks?

  4. Max Allstadt

    So if renters have to pay parcel tax, do all renters by extension get a vote on matters that are currently only voted on by property owners?

    And lets not forget that property owners also get to reap property value gains and the benefits of rising rents, neither of which help renters a mote. Is it me or are you guys agreeing with regressive taxation?

  5. dto510

    Peter, so you don’t think that renters should pay any taxes whatsoever because homeowners tend to be wealthier? And you don’t think anyone should be a landlord?

    I guess we can just convert all apartments to condos so that nobody is a landlord and they don’t “rip money from working folks.” In the meantime, if this all about class distinctions and income, rent control should be eliminated for those making more than the poverty line. Then we can be sure than only “poor people” are protected from taxes.

  6. Peter

    so you don’t think that renters should pay any taxes whatsoever because homeowners tend to be wealthier?

    renters already pay plenty of taxes. they also pay rent – in most cases, an inherently exploitative situation.

    And you don’t think anyone should be a landlord?


    I guess we can just convert all apartments to condos so that nobody is a landlord and they don’t “rip money from working folks.”

    now we’re talkin’.

    In the meantime, if this all about class distinctions and income, rent control should be eliminated for those making more than the poverty line. Then we can be sure than only “poor people” are protected from taxes.

    presumably, the purpose of that would be to move the middle class into the ‘poverty’ category. why would you want to do that?

  7. dto510

    I agree that it’s unfair that homeowners enjoy a mortgage tax deduction (something of an accident in tax code changes from the late 70s), but that’s why nobody builds apartments without special access to capital (like REITs, who get a tax deduction for building apartments). Businesses in downtown SF pay rent to their landlords, and also pay payroll taxes on top of that – is that unfair? Renters already pay their share of property taxes when they first rent an apartment, the issue is that with rent control those taxes can rise but the rents that pay for them do not. That only further creates a policy bias against moving and rewards people who live in the same place forever regardless of financial circumstances. It’s not fair to look at landlords as some limitless supply of tax income, in the extreme that will lead to mass Ellis Act evictions because it simply won’t be profitable to rent any more.

  8. Becks

    I’m not sure how I feel about all of this, but I agree that it makes no sense to decide this so late, when it’s too late to educate voters about the change.

    On rent control, it doesn’t apply in all of Oakland. If you live in a newer building (I believe the cut off date is in the mid-80s), then rent control does not necessarily apply. Though my new landlord keeps saying they don’t intend to raise rents, I’m extremely fearful that they will soon change their minds. They’ve upgraded our building significantly and every time I receive a letter from my landlord I freak out that it’s a notice that they intend to raise our rent. If they did raise it significantly, I’d probably have to move. I do have a pretty sweet deal right now, but it might not stay that way for long.

  9. V Smoothe Post author

    Kernighan’s proposal would apply only to rent-controlled units. If a unit isn’t rent-controlled, landlords can already pass on whatever costs they want.

    Becks, the cut-off date is 1983.

  10. justin

    I believe Pat’s proposal is fair, since it makes something implicit explicit. Renters, in fact, already pay a portion of their landlord’s property tax in rent, so the widespread belief that renters don;t pay for property tax increases is incorrect. Even under rent control, an increase in taxes is an increase in operating expenses, and thereby a legitimate reason to increase rents above the annual allowable rate. Getting the tax-related increase approved that way, however, requires a lengthy petition and resolution process, during which time neither the owners nor the tenants know what the final resolution should be.

    Whether Pat’s proposal passes or not, i believe it should be future practice to state the likely impact on rents of a particular tax measure. That way, renters will have a fair shot at truly understanding the costs to them of voting for a measure. As the majority of Oaklanders are renters (the majority of the electorate, I don;t know) it seems only fair.

  11. Becks

    Thanks for the clarification V. It’s odd, even though it seems obvious that landlords can pass on these taxes to renters in non-rent controlled units, it’s just something that’s never crossed my mind before. And I’m guessing other renters like me don’t think about this when they vote.

    Ultimately though, I vote for taxes based on whether they seem worthwhile and not based on how they effect me as a renter, especially since I hope to be a homeowner in Oakland someday.

  12. MarleenLee

    V – it appears that you, like the rest of the mainstream press, are simply swallowing the supposed claim that Measure NN will result in more police officers. A careful reading of the text reveals that Measure NN does not guarantee a single extra officer, and that’s just the way the City Council wanted the language to read. Do not be fooled. Do not be bamboozled. Do not allow yourselves to be lied to. Do not allow the City to take one penny more of your hard earned cash. The City promised more officers with Measure Y. We still haven’t gotten all of them, and to be clear, they didn’t even make it over the 2004 threshold number until I filed my lawsuit!!! I do not have the time to keep suing the City over all of its broken promises. Vote NO on NN!

  13. V Smoothe Post author

    Marleen, if you read the post, you’ll notice that I make no claim either way as to whether Measure NN is a good or bad thing, or what it will do aside from raising taxes. Please take your soapbox somewhere it’s relevant. I have no patience for it here.

  14. Patrick

    What is sadly missing, and which I should have made more explicit in my post, is that the majority of this parcel tax burden will be on single family homeowners. Yes, I do enjoy a FEDERAL mortgage interest deduction; but I fail to see how that translates into my responsibility for the lion’s share of a CITY problem. Please, enough of the renters vs. owners. More importantly, if you vote for increased services via a mandate to employ more police, what makes you think you should be exempt from the cost that mandate creates?

  15. Patrick

    Oh, and Becks? Your “pretty sweet deal” is paid for by me…and the other 40% of Oakland who own their homes and have made an investment in their community. I, too, was as renter once. However, the ability to pick up and leave when you choose gives you an advantage that I do not have. And I defy you to put a price on that advantage.

  16. jenv

    As a landlord who’s owned their property for about a year, I don’t agree with what’s being said above. I do not make money on my rent, in fact, the rent covers the mortgage I pay, not my property taxes or maintenance. Furthermore, I can only raise the rents once per year by a certain percentage that is approved by the Oakland Rent Board. This year it was just above 3%. On top of that, I have 2 apartments that are at “market” rent, meaning, I doubt I could pass a rent increase on those apartments for fear I would lose my tenants. My other 2 apartments are $300 under market per month.

    My building was built in the 1920s. It needs a new foundation, stucco, and electrical upgrade. I can pass a small percentage onto the tenants, but not enough to cover the entire amount. So yes, renters do not get the benefit of the tax deduction, but I don’t see renters paying thousands of dollars for the upkeep and maintenance of their apartments or the property taxes.

    I’m not complaining about being a landlord, but don’t generalize landlords into rich people. We chose to put our money in real estate and right now it’s not making money, but hopefully in 5 years it will. It’s just like the stock market, you take a risk.

  17. Patrick

    And Peter, how is paying rent an “inherently exploitative situation”? You pay for a place to live and are given a place to live in return. The property owner is the only one who has any risk involved. Let’s just say a major earthquake occurs next week along the Hayward and destroys your apartment. Would you stay and attempt to help rebuild your apartment, your neighborhood and the community? Or would you “exploit” the situation and leave, as you have no financial investment?

  18. Patrick

    And to the 3 posters that talk about “rising property values”…you have hubris that would make Sarah Palin blush.

  19. MarleenLee

    V – my issue with your post is the following quote: “If the Council approves Kernighan’s pass-through, apartment dwellers in rent-controlled units will be on the hook for $94.13 each year to cover the cost of the 75 extra police officers and 105 extra police service technicians added by the tax….” This sentence assumes that there will actually be additional staff hired as a result of the tax, and there is no certainty about that, given the wishy-washy language of the measure itself. Don’t you think Oakland residents are interested in a fair debate over what the parcel tax actually says, as opposed to the rhetoric about what some people want to believe it says? Whether landlords can pass the tax onto their tenants is not nearly as critical an issue for voters as the issue of whether the City will actually get additional officers, and when, whether residents should be taxed extra for them, and whether the amount proposed is actually justified.

  20. V Smoothe Post author

    Marleen, if you are interested in debating topics not covered by me here, I suggest you start your own blog, where you can decide which issues are “critical.” Here, I set the agenda.

  21. Becks

    Patrick, can you please explain how my sweet deal is paid for by you? I actually think if anyone’s paying for it, it’s the people who moved into the upgraded apartments in my building, who are paying a lot more than I am.

    I really have nothing against home owners (as I said, I hope to be one some day) or landlords. To suggest I’ve not made an investment in my community because I don’t own a home is absurd. Sure, I theoretically could pick up and move at any time but it’s really not that easy (moving costs are high and I have outside circumstances that constrain where I live). Also, even I moved, I’d stay within Oakland because I already have made significant investments in this city and I absolutely love it here.

    I wish this didn’t have to devolve in a renter vs. landlord/homeowner argument.

  22. Patrick

    Certainly, Becks. Your “sweet deal” is an artifice; it allows you to avoid increased taxes ..which in turn means that those of us who are directly affected by property taxes pay MORE than we would otherwise. If V is correct, each of us 40% must pay for the other 60% on measures such as this. I’m not only paying for you, I’m paying for half of another Oaklander as well (talk about taxation without representation!) Our city government is fully aware that any increase in property taxes will not pass without the approval of landlords, hence the built-in financial advantage for them (potential pass-throughs, and lowered taxes per unit). In additon, rent control does not allow property value to increase normally…and as a result, rental property owners, by necessity, limit property improvements (among other strategies) to deal with this risk. (Ask your friends in cities without rent control if they live in the deferred maintenance/third world conditions most Oakland renters do). And properties that are not fully maintained, let alone improved, are not as valuable as they could be. And this depresses the value of ALL properties. Shall I mention the cost of enforcing rent control?

    I understand that as a renter you may be invested in our city…but as a renter, your investment is only as strong as your lease. I also understand that you may want or even need to remain in Oakland…but if you had to, you could easily lower your housing costs by moving to a less expensive area. It is not that easy if you own. The city’s “property transfer tax” alone is more expensive than hiring professional movers.

    I do not think this has “devolved” into a homeowner vs. renter argument; I think that the subject at hand is fundamentally intertwined with the issue. Proposition 13 does not allow the State of California to apply ad valorem taxes evenly to all property owners. As a result, cities have resorted to parcel taxes, which tax homeowners at a flat rate, regardless of property value (and I would also suggest ability to pay).

    Again I ask: why should 40% of Oakland residents bear the burden of 100% of the costs of this measure? That is not only unfair, but it smacks of Republicanism (privatized profits and socialized risk).

  23. Peter

    And Peter, how is paying rent an “inherently exploitative situation”?

    “Rent is theft.” Feel free to google for more info – too long to discuss here. In short, shelter is a human right, so we shouldn’t charge for it. I even thought about becoming a slumlord myself, but quickly saw the light, thank goodness.

    @V Smoothe – i’ve only been around here for a day, so i don’t know your normal flow, but the amount of mean-spirited righteousness you’ve managed to pull off in a single comment is admirable — and that’s coming from someone who knows mean-spirited righteousness. but don’t let me or anyone else interfere with your ‘agenda setting.’

  24. Patrick

    Peter, if you want free shelter, call your parents. Shelter may be a human “right”, but asking others to pay for that shelter is not. Talk about mean-spirited righteousness!

  25. Patrick

    OK, I bit. I Googled “Rent is Theft”. Basically, a bunch of recent transplant San Francisco 20 somethings have moved to one of the most expensive cities in the world…and then claim housing rights when they can’t afford to pay. I’ll tell you what…how about we provide you with free shelter in, say, Iraq. Or do you now have other rights, too? Shelter, I will grant you, should be a right in our (still) wealthy country. But, the right to housing in a city in which you CHOOSE to live, as opposed to where you can AFFORD to live, is not easily defended.

  26. Ralph

    jenv, i both feel for you and admire you. if i owned property in oakland it would be kept at barely habitable. what i am suppose to put in 100s of 1000s of dollars in upkeep yet i can not pass the cost on to the people who benefit that is just darn right dumb.

    in it is with that i wish Pat K had come to the table sooner. oakland needs cops but tell me why should renters be spared the cost. do they not benefit from the additional cops on the street. if NN passes i will grab my fellow owners march down to OPD hdqtrs and demand my cop

  27. Peter

    @Patrick if you want ‘establishment’ types saying the same thing – if that would make it more comfortable for you – google ‘housing is a human right’. you will notice that these regular people, rights groups, and government officials from all over the world, including san francisco, don’t make exceptions for property owner profits.

    ‘adequate housing’ is the operative phrase — it is a necessary pre-condition for all other rights. if you don’t understand how rent – of any kind of property, including housing – is inherently exploitative, just visit the Mission one of these days and talk to some of the slumlords there who smear feces and blood on the doors of tenants they are trying to eject. they’ll help you to understand the nature of that relationship, how it can only ever be exploitative – just with varying degrees of cruelty.

  28. Becks

    Again I ask: why should 40% of Oakland residents bear the burden of 100% of the costs of this measure? That is not only unfair, but it smacks of Republicanism (privatized profits and socialized risk).

    I never suggested this. I’m opposed to the measure, but if I supported it, I’d be happy to pay my fair share.

    I understand that as a renter you may be invested in our city…but as a renter, your investment is only as strong as your lease.

    This is just not true. My investment in this city goes far deeper than my lease, and I think that’s the case for many renters (certainly not all). These are the kinds of statements that make me feel that this is just devolving into a renter vs. homeowner argument, when it really doesn’t have to.

  29. Max Allstadt

    As far as I’m concerned, there’s a very simple way to evaluate the justice of Kernighan’s proposal. What’s the median income of an Oakland renter? What’s the median income of an Oakland property owner? If the owners make more than the renters (which they do), a 50-50 split on this parcel tax amounts to regressive taxation. As a matter of fact, because this is flat tax to begin with, it’s already regressive, hitting renters just makes it worse.

    I also love how the folks that brought up rent control conveniently avoided telling us how limited it is. Spin-tastic move. Statistically, what percentage of Oakland’s renters live in rent controlled apartments? Because most of Oakland’s rents are free-market anyway, isn’t Kernighan’s measure effectively nothing more than a backdoor rent hike in rent-controlled apartments? I mean if these are the only units that would require the force of law to raise rent, than they’re the only ones directly affected, no?

    The free-market units, like mine, are subject to lease terms and negotiation between tenants and landlords only, right? Or would PK’s measure involve a letter from my landlord saying that he’s entitled to ding me for the tax? Do I get to send a letter back that says “maybe if you fix the wiring I’ll consider it”?

    And again, there are various matters that property tax payers are entitled to vote on, but renters are not, right? If renters start paying parcel tax, do they or do they not get a say in these things?

  30. ConcernedOakFF

    Umm…do you have any concept of a market economy? Let me explain then: Person A supplies a good/service (in this case a place to live), Person B needs that good/service (i.e. a place to live), Person B give Person A something in exchange (Rent money).

    Please tell me how that is exploiting the working masses? Even if it was exchanging a chicken for a place around the fire, ancient man (and women) have been exchanging in this way since time immemorial.

    Perhaps this is another argument, but the more restrictive Rental Laws are, the less a Landlord wants to do to help their renters, keep the place nice, or otherwise keep up anything but the bare essentials.

    Having been, and currently being a landlord, I can tell you this is the feeling we tend to get…

  31. V Smoothe Post author

    Max, there’s nothing “backdoor” about it. Kernighan is proposing an amendment to the Rent Adjustment Ordinance that would allow for a pass-through to tenants of 50% of the costs of Measure NN. I honestly don’t understand why anyone would object to this.

    As for “matters that property tax payers are entitled to vote on, but renters are not,” I can’t think of any, unless you’re talking about assessment districts, which is a special kind of tax created and governed by State law – nobody in Oakland has any control over them. If you want them eliminated, I suggest you contact Sandre Swanson about it.

  32. J. Given

    I’m going to have to vote no on NN. Why? Because the County Assessor valued my house at $75K more than it is worth, so I’ll be overpaying my property taxes this year instead of authorizing a parcel tax.

  33. Max Allstadt

    V, if NN passes, non-rent controlled units may see increases to cover all of the NN cost, or may see no increase if the landlord-tenant negotiations go that way. So that makes the effect of Kernighan’s proposal moot for market rate rentals.

    That means that the only units that get a legally enforceable hike are rent controlled.

    Ergo, this proposal is a rent control escalation, conditionally tied to NN. It’s just being called something else.

    By the way, why isn’t it tied to measure N, too?

  34. V Smoothe Post author

    Yes, Max, that’s why Kernighan is proposing an amendment to the rent adjustment ordinance, not some mindless resolution. It isn’t being called anything other than what it is.

  35. Max Allstadt

    gotcha. musta skipped a line somewhere.

    Until we can fix the rent control system so it accurately surveys tenant income on a regular basis, and creates safeguards that protect the most sensitive tenants, me no likey. If people on a tiny fixed income get even an extra $5 in rent, they can hit a tipping point to disaster. Not OK.

    But I just mailed my ballot with a no vote on NN anyway.

  36. Chris Kidd

    I think we’ve all gotten ourselves wrapped up a little too far into the ideological ends of this argument (free housing for all/Abolish all rent control).
    Does anyone have a figure on just how much rental housing in Oakland is under rent control? V said in the middle of the thread that the cut-off date for the imposition of rent control was 1983. I mean, that’s just a year younger than me. If it is the case that a large enough percentage of rental housing still has the original 1983 tenants, then there are definitely merits to having those renters share in the burden of putting more police on the streets.
    But if rent controlled units aren’t a large percentage of total renters, landlords shouldn’t have a legal problem with passing the costs of the parcel tax increase to their tenants. If landlords can’t pass that cost on to their tenants without losing them (like jenv suggested about her rental properties), then this really is no longer a rent control issue, a landlord vs. renter issue or anything else: it’s simply the vagaries of the open housing market. If that’s the case, maybe people should be arguing against NN as a general cost of living increase for everyone instead of setting up class-conflict dichotomies.

  37. dto510

    Chris, just to clarify, rent control applies to apartments built before 1983, not continuously occupied units. There is no vacancy control in CA so when those units are vacant the rent for the new occupant is what the market will bear, but increases continue to be regulated by the Rent Adjustment Ordinance. It often takes more than a decade of continuous occupancy for rents to be substantially below market.

  38. Chris Kidd

    danke schoen, dto. I remain indebted to you. I suppose the better question to ask then is: What are the number of people living in pre-1983 rental housing (which is a large majority) for a long enough period to significantly effect their rental rates (by dto’s estimation more than a decade) and the ability of the same landowner to absorb an additional parcel tax?

  39. Ralph

    max, we are all on a fixed income…how is that renters make more money than owners – a yr ago i was a renter, now i am not, trust me i am not earning more, i am earning less

    all i ask is that owners be allowed to pass on tax increases immediately to all renters – owners should also be allowed to pass on a greater burden of capital improvements but i digress

  40. Max Allstadt

    Ralph, come on. Using yourself as anecdotal evidence doesn’t mean a thing.

    City wide, compare the median income of renters and the median income of owners. If the renters don’t make substantially less, I’ll be shocked.

    NN is regressive taxation to begin with, so I voted against it. PK’s amendment makes it more regressive. Essentially, what it does is bail out landlords who own multiple units. If she adds some sort of income assessed exemption for poor little old ladies who’ve had their apartments since 1972, then I’m OK with it. It’s a small group of poor people who’d be hit by this, but thats all the more reason to just accomodate them.

    Plus… and the development community might even like this… making such an exemption is a precedent for means-tested rent control.

  41. len raphael

    a surprisingly retro discussion (for a fairly pro development group, youze people take a decidely un free market approach to housing). none of the new units that will be built wb rent controlled. (is that state law?)

    to throw some more gas on this ideological fire, i thought NN had some kind of exemption for “low income” home owners? if so, that would make the tax base even narrower and require owners claiming that to divulge info to the city.

    btw, in addition to what dto510 described about rent control, and continuous occupancy, even previously controlled units fall out if they’re rehabbed over 50%.

    and yes smart oakland owners of rent controlled units re-invest just enough money in their buildings to avoid citations and lawsuits. and smart oakland tennants in rent controlled units who can do so, invest or consume the money they save on renting instead of owning.

  42. greg mcconell

    The reason every city in California exempts rental units created after the intial passage of rent control, in Oakland that is 1983, is that the drafters of these ordinances know that once they are adopted new construcition will be limited. So they pass these laws and make them applicable to properties that already exist. If rent control is such a good thing or as some say, a benign form of fair regulation, why does every jurisdiction acknowledge that new units have to be exempt?

    Pat Kernighan’s proposal would only apply to units that were constructed before 1983. But before everyone gets in a tizzy, the proposal did not survive the CEDA committee yesterday. Pat said she introduced it because she previously promised to do so, but in her remarks she stated that she had serious problems with her own proposal. Translation – I am introducing this but please don’t pass it. The only vote of support came from DLF who opposes NN. He could not get a second on his motion to move it forward, so it died. (Of course things have a mysterious way of coming back to life in politics.)

    On the specifics of rent control, I would support controls for tenants who need it, but after 28 years in this field I know there are many who benefit who could well afford to pay their fair share of rent. The problem is that every time someone proposes means testing the city says it is too complicated. That, frankly, is BS. Cities do means testing with IZ and a host of other programs, why not with rent control.

    I firmly believe that if means testing were implemented, the big debate between owners and tenants would be substantially reduced. Then at least owners would not have the ability to point to the unfairness of high income tenants being subsidized by them. In the end, I think rent control continues to thrive not because it is fair and reasonable or even necessary for many tenants. It does so because tenant voters out number landlords and homeowners who think they are not affected just don’t care.

    Of course this may change if homowners realize they pay a lot more taxes because tenants do not pay for things like NN

    In any event it looks like NN is going down and we will have to build a better mouse trap immediately after the election.

  43. Max Allstadt


    You’re right, the complexity argument against means testing is BS. If NYC can do it, we can. They have at least an order of magnitude more units, but they’ve gone ahead with introducing means testing. Wouldn’t it be nice if Oakland could get on the ball with this before SF, and lead the way forward in the Bay Area on something for once?

  44. len raphael

    rent control, even for for old rental housing stock, is the rental equivalent of IZ.
    so i don’t understand how people who oppose high IZ percentages, support strengthening/extending the reach of rent control.

    Both of them seriously discourage new construction and distort the development decisions to favor highest density warehouses for poorer people in expensive hoods instead of lower density lower income housing in cheaper areas.

    you don’t want to get into means testing unless you want to create a whole layer oakland govt intrusion into everyones personal financial data. and then one can game means testing via underground economy.

    theory of real estate taxes is that it’s a “tax on wealth” or “capital” not a tax on “income”. big distinction when you consider many older homeowners might have lower income but much higher net worth than say younger people, even if you exclude the current value of their living units less their mtges. this got muddied up by prop 13.

    so do you want to test ability to pay based on “net worth” or based on “income” for IZ or for rent control?

  45. Patrick

    SO many things I’d like to address…but alas, I’m at work. So just this one for now:

    MaxAllstadt: Essentially, what it does is bail out landlords who own multiple units.

    This makes no sense to me whatsoever. I fully agree this is a regressive tax. In fact, each of my posts essentially states the same thing. However, I fail to understand how imposing this tax on everyone who occupies property in Oakland is a bail out of landlords. It suggests that you believe that by virtue of your (unproven) lower income level that people who have chosen to purchase homes should somehow be taxed, and renters should not be. “Again I ask: why should 40% of Oakland residents bear the burden of 100% of the costs of this measure?”

  46. SF2OAK

    Band aid on a cancer is what Kernighan’s proposal is. After squandering the riches of OAK on “pork” that the city council and mayor have done for far too long now Kernighan at the last minute comes up with a fair proposal, for a measure the city shouldn’t need but does. Why do not Oaklander’s want to get really serious about the crime problem and hire real top cops that will eliminate the scourge, and why do not the local gov’t want to educate the population on what crime actually costs the city? OAK should be cutting off all non essential services, and making wages and benefits much lower than the unsustainable levels they are at. This modest proposal to have renters pay for additional police services is a lame but necessary band aid the Kernighan has offered. Should we thank her for being slightly less lame than her colleagues?

    And on rent control – it is an absolutely unfair taking from one person and gift to another. If you want people to get a rent subsidy let us all pay for it not 1 individual landlord.

  47. Patrick

    And have you seen the housing that “means tested” New Yorkers live in? Trust me, you won’t be living in Rockridge if you make $18,000 a year. You’d be lucky if you lived anywhere west of Hegenberger.

  48. Patrick

    “Means testing” for rental rates? I realize this may be a “dead” thread…but come on…how can anyone justify that? Why is it the property owner’s responsibility to provide housing at a rate that the renter can afford? Should Safeway offer different pricing based on what its customers earn? What you suggest is the role that PUBLIC housing has traditionally played, and we all know how that has turned out. IF means testing was accurate AND IF all property owners shared the burden fairly (perhaps we can means test them too), MAYBE. But Max, I’m sorry, until I see Lenin on the dollar bill you’ll have to work two jobs and do without (as I do) to pay for the housing you occupy. If you can’t afford it, move.

  49. Max Allstadt


    The city of New York justified it, and there are Oaklanders who’d give their spleen to get Mike Bloomberg to come out here and fix this town.

    If you want to find time between your two jobs (unproven) to start gluing Lenin’s face to dollar bills in protest, be my guest. Tell you what, you do Lenin, I’ll do Lennon.

    I’m really tired of Americans screaming “marxism” any time the lowest rungs of society get something for free. There will always be people in our society who need more than they can provide for themselves. Until I see Ayn Rand’s face on the dollar bill, I’m going to keep saying we should pitch in and help those who need it.

  50. Max Allstadt


    Thanks for pointing out the net worth vs. income issue. It’s a nuance that’s trick to address because in order to be fair we’d have to sunset in and out on both forms of taxation, and to do that there’s an awful lot of data crunching to do.

    I fall into the old people category, BTW, even though I’m 32. Low income, but I have land free and clear. All kinds of tricky.

  51. We Fight Blight

    Police services support the entire community. There is no rational basis to suggest that renters should somehow be exempted from supporting this fundamental service. Everyone benefits directly or indirectly from a safer community. It would be interesting to know, on average, how many police calls/responses are made to rental units versus owner occupied homes. My guess is that rental units generate a much greater demand or need for police responses than do owner occupied units. If that is in fact the case, then perhaps it would be one more reason why renters should pay a fair share.

    Regarding the argument that housing or shelter is a human right and should be provided to all. Who exactly is going to build and supply all of this free housing? Landlords and investors do so because of an opportunity for a return on their capital. Food is also considered by many to be a human right. However, would we also expect that a small group of business owners represented by restaurants, grocery stores, mini-marts and farmers markets would be required to provide food under a price controlled scheme administered by the City of Oakland. I think not. Why stop there. What about clothing?

    Rent control is simply a program to redistribute income from property owners to renters. I know of numerous people living in rent controlled properties at ridiculously low rents who make $80,000 plus but will never move because of the sweet deal. They live in all parts of Oakland and Berkeley. We Fight Blight is continuously trying to get the City of Oakland and Berkeley to enforce its blight ordinances on owners of rental property who see little value in investing in their properties because they do not get a sufficient return on their investment and defer maintenance.

    Regarding the provision of affordable housing, I have come full circle. I once supported rent control, inclusionary housing and all other forms of extracting housing from a small group of investors–developers and landlords. If we as a society believe that housing is a right and that we must provide it to all that cannot provide it for themselves, we then should be willing to support a broad based tax on all members of society, with certain exemptions, with the funding used to construct and operate affordable housing or to purchase housing units from the market. The provision of housing, like police services, should not be the burden of one class of investors

  52. Patrick

    Max, if your responses made any sense, it would make it easier to discuss the issue at hand. It’s kind of like listening to Rush Limbaugh, but with a different viewpoint.

    Rent control was instituted in New York City in 1943, one year after Michael Bloomberg was born. Bloomberg wasn’t elected Mayor until 2001. Trying to tie the 2 together is spin at its best. In addition, rent control in NYC is far different than it is here. For example, when rents on properties in NYC reach a certain monetary threshold (i.e. years of government sanctioned increases), rent control ceases. It is not tied to an artifice, such as “built before 1983″. And, means testing was instituted in NYC to allow landlords to eliminate rent control for tenants who made too much money. This may have some fortunate altruistic consequence, but that was not the intention.

    “If you want to find time between your two jobs (unproven)…” Uh, I work a full time job as an import manager for a wine distribution company. And, I work 3 nights a week in a restaurant as a manager. I’ll bring my pay stubs next time we meet. Prove you’re not a blogbot.

    “I’m really tired of Americans screaming “marxism” any time the lowest rungs of society get something for free.” The notion of “free” suggests that the item in question (in this case, the subsidized portion of the rent) is unfettered from economic “loss” or “gain” by any of the parties directly involved. Rent control, however, is the requirement that one party (landlord) give something of economic value to another party (tenant) against the landlord’s will by the force of government. And that, comrade, is Marxism.

  53. David Oertel

    Instead of trying to squeeze more blood out of this struggling city with NN, why don’t people question where the money goes? We have incarceration rates that would embarrass Stalin. And an extremely expensive “drug war” that creates a lot more problems than it solves. I thought that people figured out in the twenties that drug prohibitions don’t work? And are 1 in 10 young black men so ‘criminal’ that they need to be locked up, their lives ruined, their minds socialized to gang might-makes-right values, their families disrupted, etc? And it’s hard to understand why the cops need to crack down on places like 21 Grand, Mama Buzz, people smoking in various public places, black teens hanging out on street corners in their own neighborhoods, people driving a few blocks without their seatbelts, etc. How much money do the cops waste on this mindless oppression? I don’t pay property taxes but why should my struggling neighbor have to fund all of this stupidness? These actions from the cops probably increase the general level of dysfunction, frustration and alienation that increase crime.

  54. VivekB

    As I’ve told Max & this blog previously, my issue is not with giving the underprivileged more, my issue is with giving the under-working more.

    Those who are at the lower rungs but can prove they work 40 hours/week or more deserve some consideration.

    Those who are capable of working but only want to work 20 hours per week “because they’ve got no interest in the rat race” deserve less than nothing, they deserve public condemnation for having the audacity to attempt to legally rob me. Obviously those who have some medical or family reason (taking care of elderly relatives) for not working 40 hours per week are exceptions, but I don’t believe that’s the root of the debate here.

  55. David Oertel

    VivekB, this plantation mentality is dubious at best. Historically, hunter/gatherers spent two days working. The rest of the time they sang and danced, painted their bodies, had sex, taught responsibility to the young, comforted the old and sick, etc. They spent most of their time being, well, human beings. Why is it that with all of the mechanization and modern technology, we now have to spend 2 1/2 times more time working than our ‘primitive’ ancestors. And what is all of this frantic work producing that is so great? More asphalt? More cars? More consumer stuff to store in our houses? It’s better to enjoy your humanity while you can. Life is too short.

  56. Patrick

    And life was much shorter for the hunter-gatherers. Based on fossil evidence, for a hunter-gatherer to reach the age of 30 was a notable milestone.

    You can do a lot to ease your workload. Wear only “found” clothing. Beg on street corners for food, or catch squirrels and eat them. Give up the internet, computers, television, indoor plumbing, electricity…it is all possible. And, as a beneficial side effect, you will have to work much less to afford what you have left. But don’t ask your landlord to pay the portion of your rent that you can not “afford”.

    I, too, believe that enforcing drug offenses is a no-win proposition…it creates an unregulated market, which allows gangs, druglords et al to make a tidy profit off the addicted. Perhaps a Proposition for Oakland that forbids police to enforce drug related laws – end the black market, and the associated violence/profit would go elsewhere. Alas, the feds would step in pretty quickly (and mercilessly), and although the financial cost would be borne by all US citizens, not just us, I fear the bloodbath would be worse than what we already have.

  57. Max Allstadt

    Patrick, sometimes I like to respond to demagoguery in kind. If you look at my exchanges with people like Carlos and Len, you’ll find them a little milder.

    As for proving I’m not a bot, you can either google me or ask DTO and V about my tendency to have one too many greyhounds at Van Kleefs. Actually I believe at least five or six of the posters on this blog have met me in person.

  58. David Oertel

    Patrick, I’m not the hardcore survivalist that you seem to be. But I am happy to give up cars, fancy vacations (or fancy anything), eating in restaurants, supporting pointless horrific foreign wars (either foreign or domestic ‘drug wars’), etc.

    As for technology, I’ll keep my DSL and artificial hip, and satellite TV, thank you very much. But it is not necessary for me to work 40 hour weeks to do that or to go near an office or factory floor.

    As for landlords, I don’t ask them to subsidize my lifestyle with their hard work and personal sacrifice. I am a landlord myself of sorts, and generally I don’t let people into the building unless I can be sure that when they leave, the building will be in a better state then when they entered it. That may or may not be money. It might be legal work, it might be building work, it might be good music., it might be good PR. If the Dalai Lama came here, I probably wouldn’t be that aggressive about demanding cold hard cash. And likewise, I would not take some benefit from your building, if you have one, unless you would have a good experience by virtue of my being there. And that may or may not be money.

  59. Patrick

    Max, I can only presume that by implying I am a demagogue, you are not suggesting that I am a “champion of the people”, but rather one who relies upon popular misconceptions to promulgate my cause.

    Which makes your silence on the points made in my response to your post even more interesting -acquiescence? I prefer to rely upon facts, not name calling.

    I, too, enjoy a good drink now and then (though I think a greyhound is a waste of good gin). But that begets the entire point: if you can afford “a tendency to have one too many greyhounds at Van Kleef’s”, you can most likely afford to pay the market rate for your rent. You just don’t want to.

  60. Patrick

    David, I think that you and I probably would disagree on very little. I did not mean to suggest that material goods are a pathway to a happy life. I was simply suggesting that what many people think of as necessities, are not. For me personally, purchasing a home, a yearly vacation to take advantage of my time off from work, dining out with friends, a nightly martini or three (that’s how you use gin), etc. are worth the two jobs I hold to pay for those things.

    The point is, I’ve earned what I have. And when I tire of working two jobs, I will change my lifestyle to match my earnings. I humbly suggest that those who are physically capable of doing the same thing, should.

  61. David Oertel

    Patrick, enjoy your affluence that you worked so hard for. Minimalism works for some but not for others and like you said, it works for some stages of life but not others. I lived like you once, dining in nice restaurants with friends and flying around the rockies in a small private plane. But your world is going to shrink down at some point, your reflexes are going to slow and you joints are going to freeze. And your finances are probably going to contract. But the good news is that that cup of coffee that you made for yourself and friends can be just as enjoyable as the sumptuous feast at the fine restaurant that you enjoyed in your youth. Good luck to you.

  62. Patrick

    David, affluence is relative. My small house in Fruitvale, a 7 year old car and working two jobs hardly qualifies me as “affluent”. Youth, too, is relative, and at 44 I would not exactly call myself youthful. But as I made perfectly clear, my choice to work more to do more is my choice. And when I am no longer willing (or able) to make that choice, I will adapt.

    I do hope, however, that I never come off in a blog post as a bitter old man. And good luck to you, as well.

  63. Max Allstadt

    Patrick, the silence is impatience. You’re diving into an old debate that I’ve had with folks like Vivek and others more than once. I’d rather just say fuck it and agree to disagree. It’s Sunday and it’s nice out and this is coming from an iphone. I’m not investing any more carpal tunnel for now.

    And I do pay market rate. Market rate in a 2500 squarefoot warehouse space where I built the walls and built in loft beds myself. I split it 4 ways. We each pay 480. We invested about 1200 in sheetrock and studs, and we accept that the place has some pretty major flaws, inside the front door, and outside.

  64. David Oertel

    Patrick, one last thing. And this is somewhat related to NN in that everybody is scrambling for the same crumbs that may get sucked into the police dept financial black hole (very reminiscent of the DOD black hole that is bankrupting us on the national level for very dubious results). You mention ‘free market’ ethics and there are a lot of compelling arguments there. Some of us have read George Gilder and Milton Freedman and bought into the Reagan program, though the neo-cons have driven it into the ground now. Anyway, let’s say that you work at Whole Foods for $10/hour and pay $1,200 for a small apartment at Summet Crest, a very typical wage and a typical rent in Oakland. After working for three weeks per month just paying your rent, now you only have $400 to spend on food and everything else for the month. It is unlikely that you can buy your food where you work at Whole Foods, so you must find another solution like a Haitian making levi pants in a sweatshop, not being able to afford the pants that you toil over every day. And maybe there aren’t enough high-paying jobs for these people to upgrade into or maybe they don’t have the talents or inclinations for those jobs. So what is your “free market” answer for these people? What do you tell them to do? (I’m not necessarily implying that rent control is the answer with all of it’s state meddling and incompetence.)

  65. SF2OAK

    There are probably 3 Oaklanders who’d give any part of their spleen to get Bloomberg to come here- I’m probably one of them if I only weren’t so deathly afraid of Dr.’s) I’m judging this on the fact that I’ve not seen a McCain bumper sticker, or house sign- not a 1, that and the fact that even after Dellums was voted in office and folks begged him to take the job and after people saw that Oakland was not getting any better they returned every incumbent to the City Council.

    So Max I’m curious if you see anybody on the horizon who is a Bloomberg for OAK?

  66. SF2OAK

    David you talk of OPD budget as being a black hole but isn’t the whole OAK budget a black hole? I just watched Dellums explain that he just discovered that, amazing, that he thought we were in the black but we’re really in the red. OAK has been spending beyond its means for years, it gives salaries and benefits that are unsustainable. The first priority for Dellums was that he get a raise and more money for the Mayor’s office, likewise with the City Council. Dellums said in his state of the city sppech that a $10M budget cut = 120 people laid off and that if you do the math is over $83K per employee. The fact is we’ve got way too many overpaid bureaucrats doing nothing in OAK. If Oaklanders care about about too much money going to OPD then Oaklanders must turn against criminals who are bankrupting our system, after all a dollar spent on the criminal justice system is a $ that cannot be spent on social welfare (if that is whre we choose to spend it.) Wake up citizens we can make this an inhospitable place for criminals if we choose. The choice is ours.

  67. David Oertel

    SF2OAK, I am confused by your post. Who are the criminals in your eyes? How would we make Oakland “inhospitable” to them?

    I don’t understand the high salaries either. Police start at 80K? Don’t you have to go to engineering school to make that kind of money? I thought that the cops were working class guys who went bowling and didn’t quite have the IQ to go to engineering school? Maybe now they can play golf with the dentists.

  68. Patrick


    Your question is, obviously, not an easy one to answer. I am not sure it is even possible. My posts have tried to be specific to the argument in which I found myself: is rent control fair?

    Obviously, in a nation that is as (still) wealthy as ours, that anyone should have to live without decent housing and a full stomach is disgusting. The question I was trying to answer is: do landlords have the responsibility to keep rents artificially low, even for people who may not need subsidized housing? On that topic, I think I am clear. As Oakland apartments are not means tested (which I think would be prohibitively expensive and fraught with fraud), I think that rent control actually does a disservice to many who may need it most. Rent control raises the value of all apartments by promoting scarcity due to lack of turnover. Do you know anyone who will not move because their rent-controlled apartment is such a great deal? I speak from experience, as it was a difficult choice for me to buy my house in Oakland, leaving my unbelievable rent-controlled apartment in SF in the process. Also, rent controlled apartments are relatively difficult to get; a landlord generally may pick and choose among several applicants. And, they are going to pick the person who has the best ability to pay in the long run, not who deserves it most.

    What you are asking is: who is responsible to ensure that everyone has equal access to basic human requirements? My answer to that is everyone. Every human being has the obligation to provide for those less fortunate. But that includes themselves.

    Max, for instance, has taken a warehouse space and through ingenuity and effort, converted it into a home for 4 people. If, as a group, their fortunes fell, they could probably add a couple of more bunks and reduce their rent further. It may not be the most desirable solution, but it is possible. Your hypothetical Whole Foods worker could move into a two bedroom apartment with a roommate: the overall cost may be greater, but the direct cost is lessened. Or, they could take on a second job. And, these are not necessarily a permanent solution, but they could be means to an end. Many could lower their cost of living by lowering their standard of living/working a second job temporarily, saving money, and moving to a lower cost area. Unpopular and unfair? Yes. We find ourselves in one of the most expensive and desirable areas of the world. Unfortunately, living here is not a right. If every person who wanted to live here did, you can imagine how much costs would skyrocket.

    Artificially creating living circumstances that allow people with options to “scrape by”, do not help them in the long run. My great grandfather left Germany because (as he wrote in his Bible) “My children were not meant to hold German guns, so we will not be German.” He and his family came to this country with nothing. My grandfather grew up in the slums of Milwaukee, eating lard sandwiches and hauling coal when he was 8 years old to make money to help feed his brothers and sisters. My mother raised me alone, working nights, as my father died when I was an infant. And although my life has been relatively easy, I worked my way through college and I have never been out of work for over one week in my adult life, including driving a cab and mowing lawns between jobs to make ends meet.

    But I digress. You are not talking about people like me. You are talking about people who are victims of circumstance: lack of education, opportunity, health…people who can not afford to take care of themselves. And many people I know, who benefit from rent control, are not these people. And THAT is what I am trying to point out as unfair.

    I realize this was not an answer to your question. It really has little to do with NN (with the exception that by extension, it is unfair to tax certain citizens, by sole virtue of property ownership, for the purported benefit of all). If forced to offer one, I would have to say (quoting my grandfather) “anyone who needs welfare should get it”. Why? Because total federal spending (in 2007) for welfare and unemployment compensation combined was about 40% of our governments *requested* expenditure on defense. The actual amount spent on defense was, as we all know, much greater. As a nation, we can afford to erase poverty. Yet we choose not to. And that is sickening.

  69. David Oertel

    Patrick, I just voted against NN on my absentee ballet. Coercion sucks – I want no part of it, and that seems to be much of what government is about. As for helping others who are down, I do that anarchically or via NGOs or by sharing whatever I have in an ad hoc way, day-by-day, while not allowing myself to be gamed by some predatory jerk, and that could be the cops or some street bum.

  70. VivekB

    Good Lord what a ton of responses. I was doing what Max suggested, and enjoying the day. Got back late, then had a killer day today @work.

    I’d reply now to David, but I just finished bathing my kids, and I’m about to help my daughter with her homework. Then i’ll be chilling and watching “Terminator” and “Heroes”. I’m sure I’ll have another opportunity soon enough though, in the meantime i’ll just sit back and enjoy all my affluence and opulence :-)