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gistrator, as the case may be, shall be brought in the Superior Court of the District of Columbia.

th The Superior Court, in issuing any order in any action brought tunder this section, may award costs of litigation (including a reasonable attorney's fee) to any successful party.

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EFFECTIVE DATE

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Sec. 104. This act shall take effect at the end of the 30-day period irscluding Saturdays, Sundays, holidays, and days on which either House of Congress is not in session) provided for Congressional rerew of acts of the Council under subsection (c) of section 602 of the District of Columbia Self-Government and Governmental Reorgamization Jet, and shall terminate at the end of the second year occurring immediately after such effective date. At the end of the first year following such effective dete, the Council shall review the rent siabilization program established in this act through review of the reports mopuired in Section 102(b) and through any other investigations or Learings it may conduct or require.

SEVERABILITY

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SEC. HIS. If any provision of this act, or any section, sentence, clause. phrase or word or the application thereof, in any circunstances is held invalid, the validity of the remainder of the act and of the application of any such provision, section, sentence, clause, phrase or rorlshall no: be affected.

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COUNCIL OF THE DISTRICT OF COLUMBIA

REPORT To: All Councilmembers. From: Nadine P. Winter, Chairperson, Housing and Urban Develop

ment Committee. Date: July 31, 1975. Subject: Report on Bill 1-157, Rental Accommodations Act of 1975.

The Committee on Housing and Urban Development, having considered The Rental Accommodations Act of 1975 (Bill 1-157), reports favorably upon the Bill and its amendments as approved, and recommends enactment of the Bill,

The Bill, which stabilizes rents in the District of Columbia and establishes a Rent Control Commission, received a final reading and was passed by the Council of the District of Columbia on July 29, 1975.

A legislative history of the Bill and similar legislation which it predates appears below in the section titled, Background.

BACKGROUND

On February 27, 1973 Delegate Walter Fauntroy introduced to the Congress of the United States, a bill (HR 4771), to regulate the rents that landlords in the District could charge their tenants. The hearings before the Sub-Committee on Labor, Social Services, and the International Community of the Committee of the District of Columbia clearly established the need for such legislation. As a result Public Law 93-157, 87 Stat. 626, was signed into law on November 21, 1973. This enabling legislation authorized the Council of the District of Columbia to regulate rents in order to provide tenants a measure of protection in a sellers market, and it required the District of Columbia to assure landlords a reasonable rate of return.

On April 26, 1974 the Council of the District of Columbia passed Regulation 74-8, a regulation designed to impose a temporary freeze on rents while allowing the Council of the District of Columbia time to develop a comprehensive measure. Technical errors in that measure required the enactment of Regulation 74-9 which was signed into law on April 29, 1974. Immediately after enactment landlords filed suit in court, charging that the Regulation (74–9) violated their constitutional rights in that no emergency existed and that no provision for pass-throughs of increased costs was included. Furthermore, since Regulation 74-9 was passed as an emergency measure but without a prior notice of 24 hours it was presumed by landlords to be invalid by virtue of procedural mistakes.

Before the court ruled upon the motion, the District Council passed Regulation it-13, a measure identical to the previous one. The courts, recognizing the temporary nature of the Regulation and the District

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of Columbia Council's authority to pass such measures, denied the landlord motions.

By July 26, 1974 the District of Columbia Council adopted Regula

tion it-20 which was signed into law on Augst 1, 1974. This measure, elop the result of countless hours of work by tenants, landlords, Councilmembers and staff

, provided a mechanism for landlord and tenant relief. An automatic increase formula allowed landlords to raise their rents a few percentage points and included a hardship provision for

thos landlords who could not live within the percentages established. porti Tenants were protected from caprious evictions, decreases in services

and excessive rent increases.

Notwithstanding the almost self-regulating nature of the measure, dles the rent control program was not working well by November. Jem

bers of the Housing Rent Commission complained publicly that the is.

$5,10 authorized to be appropriated by the Congress was insufficient chi to administer the program effectively. It was further charged that the

Executive Branch of the District of Columbia was providing inadequate supplementary assistance. Some tenants claimed that the landlords were filing an excessive number of petitions in order to

sabotage the work of the Cominission. Some lanıltords claimed that the the problem resulted from the irresponsible behavior of tenant representa

tives on the Commission. Whatever the reasons, the Commission could wings not process these petitions within the sixty days established by law.

Landlords, subsequently, filed suit. The courts began allowing landmbis lords to return their rents to the August 1st levels, whenever the ComLa mission could not process their petitions. Landlords, unhappy that the This Regulation was not held invalid, and the government, displeased with mbis allowance of increased rents, appealed the decision. The D.C. Court unin of Appeals' decision of July 16, 1975 is interpreted as follows:

1. The pass through and reasonable rate of return requirements

mandated in Public Law 93–157 (the Congressional Authority) had here not leen fully complied with in Regulation 7+-20. (However, since the

Council's legislative authority emanates from the Home Rule Charter, the Rental Accommodations Act (Bill 1-157) will not be directly affected by this decision.]

2. Inadequate administrative procedures which result in unduly long periods of time for landlords or tenants to receive remedies from their petitions may constitute lack of due process in Regulation 7+20. These procedures with respect to time delays in landlords receiving rents, etc. have been remedied in the new Bill (1–157).]

On January 22, 1975, shortly after its inauguration, the Council of the District of Columbia held hearings on the need for continued rent control. The overwhelming testimony indicated that some form of rent control was needed. What seemed evident, however, was the need for substantially increased logistical support and a mechanism to expedite proceedings in order to reduce the backlog of cases. In

response to the testimony, Councilmember Nadine Winter of Ward 6. introduced on March 11, 1975, Bill 1-40, a bill to stabilize rents in the District of Columbia and to establish a Rent Stabilization Commission. The bill was referred to the Committee on Housing and l'han Development which is chaired by Ms. Winter. The bill was designed to resemble the previous regulation and to offer the same protection to tenants and landlords as accorded in that previous Regula

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tion (74–20). The bill did, however, differ from the regulation in that it stripped from the Commission its administrative role. The Commission was designed to be a policy and appeal board with the administrative and denovo adjudicatory functions transferred to the Rent Administrator. The changes were made in an effort to expedite processing of petitions and to encourage the maximum attention to procedural details that a body unencumbered with numerous caseloads might give.

At approximately the same time the bill was introduced, the Mayor of the District of Columbia transferred to the Council, the District Budget for fiscal year 1976. Included with the budget of the Office of Housing and Community Development was a budget request for $529,000 for the Housing Rent Commission. The Committee on Housing and Urban Development added $140,000 to that budget request in anticipation of the increased workload likely to result in administering the new bill. Such a figure matches the Executive Branch's estimate of what would be required to administer the act. The Committee on Housing and Urban Development is determined to see the rent control program succeed in the District of Columbia.

Hearings on Bill 1440 were held on April 9, 1975. Of the more than seventy witnesses testifying, few were landlords. Those landlords who appeared did not deny that there might be a need for controls. They pleaded for a higher percentage ceiling and a relaxation of some of the burden of paperwork. Tenants, many from the City-wide Housing Coalition, wanted no increases and were instrumental in providing evidence to counter the study by the Apartment and Office Buildings Association. (See Attachment A-Report from Bureau of Social Science Research)

The Committee chairperson requested that the members of the Coalition and AOBA meet in round table discussions in order to see if a consensus might be reached. They met and discussed differences without reaching a definitive argreement. The Committee staff maintained contact with members of both groups in an effort to clarify issues and develop a method for solving some problems.

The final mark-up session on Bill 1-40 was held by the Committee on May 2, 1975 and reported out at that session. The first reading of the Council was May 20, 1975 and the vote was eleven (11) years, zero (0) no, one (1) present and one (1) absent. The second reading was on June 10, 1975 and the Bill was unanimously passed by the Council

. On June 27, 1975, the Mayor returned the Bill to the City Council with his disapproval while expressing full support of rent control. The Mayor suggested that the measure was primarily defective in its:

1. Failure "to provide an equitable rent stabilization program which protects tenants against excessive rents while at the same time providing landlords with a reasonable return".

2. Creation of "unending adverse impacts on the city's housing supply".

3. Impairment of construction and rehabilitation of rental stock with "a significant loss and deterioration of the less than adequate existing rental stock". (See Attachment B-Mayor's veto message of Jme 27, 1975, specifying the other concerns relating to his disapproval of Bill 110.)

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The Council chose not to override the veto, but to accept the Mayor's

offer to be available with his staff to resolve the aforementioned ra Rent

The Mayor, the Committee, other Council members and appropriate staf persons from the Executive and Legislative branches diligently

worked to resolve the differences during the following week and on traddlr 15, 1975, a new Rental Accommodations Act (Bill 1-157) was

passed by the Council. This new Bill (1–157) essentially embodied the Impfundamental thrust and intent of Bill 1-10 which had been vetoed

by the Mayor. The major changes were:
1. The Rental Accommodations Office was changed from an inde-
pendent agency to one established as an agency of the District of
Columbia government within the executive office of the Mayor.

2. All new construction was exempted for units for which the initial

certificate of occupancy was issued after February 2, 1973 for the Puf initial leasing period or the first year of tenancy (whichever occurs

3. The formula for rent increases was changed to provide a floor of eight percent as opposed to seven percent as a reasonable rate of

4. The maximum allowable rent increase was changed from four percent of the amount computed in Step 2 of the formula plus the pass-through provision for utilities to five percent, with no allowance for pass-through of utility costs.

3. The limitation on depreciation expense in the rate of return Hi formula was removed and the Rent Administrator was provided with al: the authority to increase that limit if properly justified.

6. The registration and filing procedures were simplified and the
time necessary for these procedures was reduced.
1. Hardship provisions were added to allow landlords to file peti-

tions for an additional increase who (after allowable increases) can tit! still show a negative cash flow.

The provisions of Regulation 74–20, extended on April 24, 1975 by
Act 1-12 would expire on July 26, 1975. Therefore, it was necessary

to insure that the city would not be without any form of rent control. Fof Act 1-35, a transitional rent stabilization program was enacted on

July 22, 1975 on an emergency 90 calendar day basis. The major provisions of this legislation were as follows:

1. The provisions of Regulation 74–20 remained in effect for a period of sixty days after enactment.

2. During this interim period, the Housing Rent Commission would not receive or act upon any petition for adjustment of rent filed with it and would continue action on those previously filed.

3. Landlords shall not raise any rents except pursuant to previous

commission or court order. ing 4. The provisions of Bill 1-157 were incorporated into the Act 60

days after the effective date with the exception that the Mayor would appoint the members of the Commission to serve until such time as thie confirmation process could be completed and that the bill would be subject to the following amendments:

(1) In section 202(b), strike "not less than 30, but”;

(2) In section 204(h)(2), strike out "60", each place it appears and insert in lieu thereof "30";

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60-419 0.75 - 9

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