Elk Grove Municipal Code Art. X Rent Escrow Account Program

This article shall be known as the rent escrow account program of the City.

(Ord. 2000-1 § 1, eff. 7-1-2000; Ord. 2000-14A § 1, eff. 10-25-2000; Ord. 7-2009 § 3, eff. 5-1-2009)

A. Purpose. It is the purpose of the provisions of this article to provide a just, equitable and practical method, to be cumulative to and in addition to any other remedy available at law, or pursuant to this chapter to encourage compliance by landlords with respect to the maintenance and repair of dwellings, or portions thereof.

B. Scope. The provisions of this article shall apply to all dwelling units in all existing dwellings which consist of or contain one (1) or more rental dwelling units.

C. Role of the Director. The Director shall be responsible for carrying out the provisions of this article.

D. Other Provisions of the Elk Grove Municipal Code Unaffected Hereby. The provisions of this article shall not be deemed to repeal by implication any other provision of this chapter or this code, and the adoption hereof shall not be deemed to affect or diminish the power or authority of an officer or employee of the City to condemn, demolish, or repair any building or structure erected or maintained in violation of any provision of said code. The application of the provisions of this article shall not be construed as constituting ownership, operation, or management by the City of any building.

E. Cumulative Nature of Remedies and Penalties. Unless otherwise expressly provided, the remedies and penalties provided by this article are cumulative to each other and to any other remedies or penalties available under law.

(Ord. 2000-1 § 1, eff. 7-1-2000; Ord. 2000-14A § 1, eff. 10-25-2000; Ord. 7-2009 § 3, eff. 5-1-2009)

A. Referral to Hearing Officer. The Director may determine whether any building contains any untenantable dwelling unit within ten (10) days after the expiration of the period allowed for compliance with an order or citation issued by the Director where there has not been such compliance, or within ninety (90) days after the date such order or citation was issued, whichever first occurs.

The determination by the Director shall be in writing and shall contain the street address of the property, a description of the uncorrected deficiencies, the names and addresses of the landlord, any interested parties, any tenants as shown on the records of the Director, the apartment number or address of each untenantable dwelling unit, and any other information as required by such regulations as the City Council may promulgate. The Director shall specify that noncompliance with the citation or order appears to render the building or a portion thereof untenantable. In any appeal, a determination by the Director shall not be invalidated solely because required information is not included, or is inaccurate or incomplete.

B. Notice of Eligibility. Within ten (10) business days after making such determination, the Director shall give to the landlord, tenants, any interested parties and any other person who has requested such notification in writing, a notice of eligibility to place the building into REAP.

The notice of eligibility shall provide written notification to the landlord of the eligibility of the dwelling for placement into REAP and shall list the street address of the property, a description of the uncorrected deficiencies, and the apartment number or address of each untenantable dwelling unit. The notice of eligibility shall specify a date and time, not less than fourteen (14) and not more than thirty (30) days from the date of the notice, at which the landlord may appear for a formal conference before the Director. The notice of eligibility shall also state that if the building is placed into REAP, the City shall establish an escrow account for the deposit of monthly rent payments, with a nonrefundable administrative fee of Fifty and no/100ths ($50.00) Dollars per individual rent payment.

C. Manner of Giving Notice. The notice described in this section shall be given in writing and may be given either by personal delivery thereof to the landlord or by deposit in the United States Mail in a sealed envelope, first class postage prepaid, addressed to the landlord at the address known to the Director, or as shown on the last equalized assessment roll if not known. Service by mail shall be deemed to have been completed at the time of deposit in the United States Mail. The failure of any landlord or other person to receive such notice shall not affect in any manner the validity of any of the proceedings taken thereunder. Proof of giving any such notice may be made by a declaration signed under penalty of perjury by any employee of the City which shows service in conformity with this section.

D. Formal Conference. At the formal conference the landlord may demonstrate that the deficiencies have been corrected, that the landlord has obtained the necessary permits and has substantially commenced the work necessary to abate the deficiencies, or that the dwelling does not come within the scope of this article. Prior to the date specified in the notice of eligibility, the landlord, in lieu of or in addition to the personal appearance provided for in this subsection, may submit to the Director written information upon a form and with the number of copies prescribed by the Director. Such submissions shall be accompanied by a declaration stating that the information is true and correct.

(Ord. 2000-1 § 1, eff. 7-1-2000; Ord. 2000-14A § 1, eff. 10-25-2000; Ord. 7-2009 § 3, eff. 5-1-2009)

A. Final Determination. Within ten (10) days after the formal conference or the date set for the formal conference when no formal conference is held, the Director shall issue and serve upon all parties entitled to notice a final determination as hereinafter described.

B. Final Determination Process. The Director shall review each dwelling with respect to its suitability for inclusion in REAP. At the completion of the review process, the Director shall select one (1) of the following three (3) options:

1. Acceptance. If the Director determines that a dwelling meets each of the findings set forth in subsection (C) of this section, then the Director shall determine to accept the dwelling into REAP.

2. Rejection. If the Director determines that a dwelling does not meet all of the findings set forth in subsection (C) of this section, then the Director may determine to reject a dwelling for inclusion into REAP. The final determination shall state the reasons for the rejection and shall state that such rejection does not relieve the landlord of criminal or civil liability under any other provisions of the law, and, where appropriate, that the dwelling may be placed into REAP at a future date.

3. Suspension of Consideration. If the Director determines that a dwelling does not meet all of the findings set forth in subsection (C) of this section because work has commenced or has been completed to correct the deficiencies, and the Director has not yet issued proof of compliance, then the Director may determine to suspend consideration of the dwelling. However, the Director shall specify a date, not later than the time reasonably necessary for the landlord or interested party to complete the work and obtain the proof of compliance, at which time the Director shall reconsider the eligibility of the building for REAP.

Upon such determination of suspension, the Director shall notify the landlord, any interested parties, any tenants known to the Director, any other persons who requested notice in writing, and any other occupants of the dwelling that the building is not included in REAP at that time. The final determination shall state the reasons for the suspension and shall state that such suspension does not relieve the landlord of criminal or civil liability under any other provisions of the law. The notice shall also specify the date that the Director will reconsider the eligibility of the building for REAP unless the Director is provided with proof of compliance prior to such date.

C. Findings. In determining whether a dwelling should be included in REAP, the Director shall find that each of the following factors exists:

1. The dwelling contains one (1) or more untenantable dwelling units as the result of the deficiencies noted in the citation or order; and

2. The landlord has refused or has consistently failed to correct the deficiencies.

D. Notice of Preliminary Acceptance. Within ten (10) business days of the acceptance by the Director of a building into REAP, the Director shall mail notification of the preliminary acceptance to all parties in interest, to SMUD, to PG&E, and to the occupants of each untenantable rental dwelling unit, and any other person who has requested such notice in writing.

The notice of preliminary acceptance shall state that the dwelling, subject to the final approval of a Hearing Officer, has been accepted into REAP and shall state the following:

1. The street address of the dwelling;

2. A description of the uncorrected deficiencies;

3. Which dwelling units in the building are eligible for payment into the REAP escrow account;

4. The proposed date upon or after which an escrow account shall be established into which tenants of untenantable rental dwelling units may deposit their rent in lieu of payment to the landlord;

5. That a nonrefundable administrative fee of Fifty and no/100ths ($50.00) Dollars per participating dwelling unit per monthly rent payment shall be collected by the City from the escrow account;

6. The date, if no appeal is filed, on which the Hearing Officer will consider whether to approve the acceptance of the building into REAP;

7. The right of the landlord or other interested party to appeal the determination of the Director pursuant to the provisions of Article V of this chapter.

E. Hearing Officer Approval of Acceptance.

1. A Hearing Officer, by order, may accept a dwelling into REAP, adopting the determination of the Director where no appeal is filed, and finding that each of the factors set forth in subsection (C) of this section exists. The action of the Hearing Officer accepting a dwelling into REAP shall be final, except as provided in subsection (E)(2) of this section.

2. The Hearing Officer may, at any time, upon the application of the Director, rescind the order of acceptance if the Hearing Officer finds that the order is no longer necessary.

F. Notice of Acceptance. Within ten (10) business days of the acceptance by the Hearing Officer of a dwelling into REAP, the Director shall mail notification of the acceptance to the parties in interest.

The notice of acceptance shall state that the dwelling has been accepted into REAP and shall state the following:

1. The street address of the property;

2. A description of the uncorrected deficiencies;

3. Which rental dwelling units in the dwelling are eligible for payment into the REAP escrow account;

4. The date upon or after which an escrow account shall be established into which tenants of untenantable rental dwelling units may deposit their rent in lieu of payment of the landlord; and

5. That a nonrefundable administrative fee of Fifty and no/100ths ($50.00) Dollars per participating rental dwelling unit per monthly rent payment shall be collected by the City from the escrow account.

G. Service of Notices. The notice of preliminary acceptance and the notice of acceptance shall be sent to each landlord and interested party both by certified mail, postage prepaid, return receipt requested, and by first class mail, postage prepaid, at the address or addresses of such person as it appears on the last equalized assessment roll of the City or as known to the Director. Service on other persons entitled to a notice may be sent by first class mail, postage prepaid. In addition, a copy of the notice of preliminary acceptance or the notice of acceptance shall be posted in a conspicuous place upon the dwelling involved. The failure of any landlord or other person to receive such notice shall not affect in any manner the validity of any proceedings taken thereunder.

H. Declaration of Service. The Director, upon giving notices as provided in this section, shall make a declaration under penalty of perjury certifying to the date and manner in which such notice was given. Any receipt card which may have been returned to the Director in acknowledgment of the receipt of such notice by certified mail shall also be filed with the declaration.

I. Recording. At the time that the Director gives the notice described in subsection (D) of this section, the Director shall file and record with the Sacramento County Clerk-Recorder a certificate describing the real property and stating that the subject building has been placed in REAP and that the owner thereof has been so notified. After the building has been removed from REAP, the Director shall file and record with the Sacramento County Clerk-Recorder a certificate terminating the aboverecorded status of the subject building.

(Ord. 2000-1 § 1, eff. 7-1-2000; Ord. 2000-14A § 1, eff. 10-25-2000; Ord. 7-2009 § 3, eff. 5-1-2009)

A. At any time during a dwelling’s participation in REAP, a landlord, any interested party, a tenant, and any creditor, including any utility, contractor, or sub-contractor, whose debt arose from the purchase, repair, maintenance, or operation of the building may apply to the Director for a release of funds from the escrow account. The Director shall review such applications and, where the landlord concurs, may order the release of funds from the escrow account where it has been demonstrated to the satisfaction of the Director that such release is necessary to prevent a significant diminution of an essential service to the building, including utilities, or is necessary for the correction of the deficiencies noted. Where specifically ordered by a court, the Director shall order the release of funds from the escrow account irrespective of concurrence by the landlord.

B. The Director shall deny the application where he or she determines that the application for payment of the debt is intended, in whole or in part, to circumvent the provisions of this article. A debt incurred subsequent to notice to such creditor that the dwelling is under consideration for or had been selected for participation in REAP shall be presumed, subject to rebuttal, to be for the purpose of circumventing the provisions of this article.

C. At any time during a dwelling’s participation in REAP, a tenant may apply to the Director for a release of funds from the escrow account for purposes described herein. The Director shall review such applications and, where the landlord concurs, or fails to object within a reasonable time as determined by the Director, may order the release of funds from the escrow account.

(Ord. 2000-1 § 1, eff. 7-1-2000; Ord. 2000-14A § 1, eff. 10-25-2000; Ord. 7-2009 § 3, eff. 5-1-2009)

The Director shall have the following duties:

A. Determination of Interested Parties. In addition to any interested parties known to the Director, the list of interested parties shall include all persons appearing to hold an interest of record with the Sacramento County Clerk-Recorder concerning the subject property, of whatever type.

B. Contact with Tenants. The Director may contact the tenants of any dwelling during or after review. Such contact may be in person or by mail or both. The Director may contract with other persons or organizations to carry out this activity. During such contact, the tenants shall be informed of the principal provisions of REAP, of the mechanism for voluntary payment into the escrow account by tenants of untenantable rental dwelling units where the dwelling is accepted into REAP, and of their legal rights with respect to eviction under the provisions of this article.

The specific responses of tenants and any information in a form which is identifiable to any individual tenant shall not be a public record and shall not be disclosed to the landlord, any interested party, or the general public.

C. REAP Trust Fund. The Finance Director shall establish in the City Treasury and the Director shall maintain an interest-bearing REAP trust fund under the control of the Director in accordance with the provisions of this chapter.

(Ord. 2000-1 § 1, eff. 7-1-2000; Ord. 2000-14A § 1, eff. 10-25-2000; Ord. 7-2009 § 3, eff. 5-1-2009)

A. Appeal. The appeal provisions set forth in Article V of this chapter shall apply to all appeals taken under the REAP program. Failure to appeal in accordance with the provisions therein set forth shall constitute a waiver of any right to an administrative hearing and determination of the matter.

(Ord. 2000-1 § 1, eff. 7-1-2000; Ord. 2000-14A § 1, eff. 10-25-2000; Ord. 7-2009 § 3, eff. 5-1-2009)

A. Within ten (10) business days after the order accepting a dwelling into REAP becomes final, the Director shall establish as part of the REAP trust fund an account for such dwelling into which tenants of untenantable rental dwelling units of such dwelling may deposit rent payments. The Director shall mail notification to all such tenants of the existence of the account, including an explanation of how payments may be deposited into the account. The Director shall provide a receipt to each tenant making a deposit. The Director shall provide, at least once (1) a month, a periodic report to the landlord and the tenants concerning the activity in such account. The records of such account shall be reasonably available to the landlord or any interested party, or their representatives, in accordance with such regulations, including the provision for payment of reasonable fees, as the City Council from time to time may promulgate.

B. The gross amount of payment made into the account by or on behalf of a tenant shall be deemed as a payment in the same amount to the landlord, including, but not limited to, for the purpose of determining whether a tenant has paid rent. In any action by a landlord to recover possession of a dwelling unit, the tenant may raise the fact of payments into REAP as an affirmative defense in the same manner as if such payments had been made to and accepted by the landlord.

C. A landlord may bring an action to recover possession of a dwelling unit that has been accepted into the REAP program only upon one (1) or more of the following grounds:

1. The tenant has failed to pay rent into REAP or to the landlord.

2. The tenant has violated a lawful obligation or covenant of the tenancy and failed to cure such violation after having received written notice thereof from the landlord.

3. The tenant is committing or permitting to exist a nuisance in, or is causing damage to, the dwelling unit or to the appurtenances thereof, or to the common areas of the complex containing the dwelling unit or is creating an unreasonable interference with the comfort, safety, or enjoyment of any of the other residents of the same or any adjacent building.

4. The tenant is using or permitting a dwelling unit to be used for any illegal purpose. The term “illegal purpose” as used in this subsection includes, but is not limited to, the conviction of a tenant for possession or sale of illegal drugs from the dwelling units.

5. The tenant has refused the landlord reasonable entry pursuant to Section 1954 of the Civil Code.

D. Prior to or at the same time as the written notice of termination described in Section 1946 of the Civil Code, or the three (3) days’ notice described in Sections 1161 and 1161a of the Code of Civil Procedure is served on the tenant of a dwelling unit, the landlord shall serve on the tenant a written notice setting forth the reasons for the termination with specific facts to permit a determination of the date, place, witnesses and circumstances concerning the reason. This notice shall be given in the manner prescribed by Section 1162 of the Code of Civil Procedure.

E. If the landlord is seeking to recover possession of a dwelling unit in retaliation against the tenant for exercising his or her rights under this article, or because of his or her complaint to an appropriate agency as to the tenantability of a dwelling unit, then the landlord may not recover possession of a dwelling unit in any action or proceeding or cause the tenant to quit involuntarily.

F. In any action by a landlord to recover possession of a dwelling unit, the tenant may raise as an affirmative defense any of the provisions set forth in subsections (B) through (E) of this section. Violation of subsections (B) through (E) of this section shall not constitute a misdemeanor.

G. The Clerk shall deduct a nonrefundable administrative fee of Fifty and no/100ths ($50.00) Dollars for each individual rent payment made into the REAP account. Only one (1) such fee shall be deducted for each rental dwelling unit for each month. When collected, such fee shall be deposited into the housing code enforcement fund.

H. The funds paid into the REAP escrow account shall only be expended on the following items:

1. The nonrefundable administrative fee provided under subsection (G) of this section.

2. Funds returned to the landlord where the landlord has provided the Director with proof of compliance that the deficiencies have been corrected.

3. Funds paid in accordance with a court order.

4. Funds paid to the landlord, an interested party, tenant, creditor, utility, or other person or entity pursuant to an order of the Director.

5. Funds paid in accordance with and pursuant to such regulations as the City Council may promulgate.

(Ord. 2000-1 § 1, eff. 7-1-2000; Ord. 2000-14A § 1, eff. 10-25-2000; Ord. 7-2009 § 3, eff. 5-1-2009)

A. Request for Removal. The landlord or any interested party may apply to the Director for an order removing a dwelling from REAP on the grounds that the deficiencies noted in the citation or order have been corrected and that continued placement in REAP is not necessary to ensure continued compliance by the landlord with respect to required maintenance of the dwelling. A request to terminate the payment of rents into a REAP escrow account may be made at any time. A request to remove a building from regulation pursuant to this article may only be made after the expiration of twelve (12) months from the date the deficiencies noted in the citation of order were corrected.

B. Director’s Decision. The Director shall review the request to remove a building from REAP, and take such other steps or actions as may to the Director seem appropriate under the circumstances to determine whether removal of the building from REAP is warranted. The Director shall issue an order granting or denying the request within thirty (30) days of its receipt. A copy of the Director’s order shall be served upon all interested parties by mail. The order of the Director shall be appealable under those provisions as set forth in Article V of this chapter. The landlord shall be bound by the determination of the Director as to the existence or correction of deficiencies.

C. Notice of Removal. Once the order to remove a dwelling from the REAP program has become final, notice thereof shall be given to all interested parties by the Clerk in the same manner as for service of notice of eligibility as set forth in this article.

D. Closing REAP Trust Account. Once the order removing a dwelling from REAP has become final, and after all claims against the REAP trust account have been settled, the remaining balance, including interest, if any, shall be disbursed to the party entitled to receive same and the REAP trust account shall be closed.

(Ord. 2000-1 § 1, eff. 7-1-2000; Ord. 2000-14A § 1, eff. 10-25-2000; Ord. 7-2009 § 3, eff. 5-1-2009)

The landlord shall not increase the rent for any rental dwelling unit included in REAP during such time as the dwelling unit or units remain in the REAP program, except that, for a dwelling unit which is voluntarily vacated by all of the tenants after all of the deficiencies noted in the citation or order have been corrected, the landlord may increase the rent to any amount upon re-rental of the dwelling unit.

(Ord. 2000-1 § 1, eff. 7-1-2000; Ord. 2000-14A § 1, eff. 10-25-2000; Ord. 7-2009 § 3, eff. 5-1-2009)