Subsidized housing loophole put on hold amid tenant backlash

The Richmond Rent Board voted unanimously last week to temporarily suspend a regulation that allowed hundreds of rent-controlled units to be stripped of tenant protections as residents of Monterey Pines Apartments reported mold, broken heaters, unexplained utility bills, and threats of eviction from their landlord.

The board voted 3-0 to adopt Resolution 26-01, freezing all processing of new exemption applications under Regulation 202 for 180 days. Board members Whitney Tipton, Tomasa Espinoza, and Melvin Willis, with two members absent, supported the measure. The resolution directs staff to schedule a study session to examine how the exemption policy has affected tenants across the city.

Regulation 202, adopted in 2017, allows landlords whose units are subsidized through programs such as the federal Low-Income Housing Tax Credit or the Section 8 Housing Choice Voucher program to apply for exemption from Richmond's rent control ordinance. Once exempted, tenants in those units lose access to the Rent Board's petition process and may face rent increases exceeding the cap set by Measure P, which limits annual increases to 60 percent of the Consumer Price Index or 3 percent, whichever is lower.

Deputy Director Fred Tran told the board that beginning in September 2025, the Rent Program began receiving exemption applications from entire apartment complexes, a trend staff had not previously encountered.

"We do see a trend of that happening in the near future," Tran said. "It’s something we have some concern about and believe needs further assessment and examination."

Tran said the shift was moving units from "fully covered" to "partially covered" status, reducing tenants' ability to file petitions over habitability, housing services, or other issues.

General Counsel Charles Oshinuga described the resolution as a pause rather than a repeal.

"It's like a moratorium. You freeze everything in time," Oshinuga said, adding that existing exemptions already granted would remain in place while the board studied the issue.

Adam Morton, an attorney with the California Center for Movement Legal Services, a nonprofit legal organization known as Movement Legal, spoke on behalf of what he described as more than 300 Monterey Pines tenants. Movement Legal grew out of the Alliance of Californians for Community Empowerment, or ACCE Institute, where it served as the organization's in-house legal department before becoming an independent nonprofit.

Morton told the board the situation at Monterey Pines was not a first offense.

"For the second time, a greedy landlord has abused the rent board's trust at the expense of low-income and working-class members of this community," Morton said.

Morton traced the history: when Richmond voters passed the rent control ordinance in 2016, there was no exemption for affordable housing tax-credit landlords. The Rent Board created one in 2017, he said, and within months, landlords issued rent increases exceeding ten percent. The board responded in 2019 by capping increases at five percent.

Now, Morton said, the owner of Monterey Pines, Monterey Venture, has imposed ratio utility billing charges since November 2025, dividing shared utility costs among tenants by formula rather than by individual usage, resulting in effective rent increases sometimes exceeding 20 percent and, in some cases, more than doubling costs for Section 8 voucher holders.

"We can't keep letting them get away with it. We can't keep trusting them. We give them an inch, they take a mile, and it's working families and the elderly who pay the price," Morton said.

Morton called on the board to permanently rescind Regulations 202 and 204 rather than pause them.

More than 20 residents, many speaking through interpreters, addressed the board during public comment about conditions at Monterey Pines Apartments in Richmond. Tenant after tenant described a landlord who they said ignored maintenance requests, charged opaque utility bills, and threatened retaliation against those who complained.

Sharmina Guerrero, who said she has lived at the complex for over 10 years, described conditions that had steadily worsened.

"We are hard-working people with disabilities, the elderly, and they're abusing us," she said, adding that water bills jumped from $184 in November to $257 within two months with no explanation of how the figures were calculated.

Rent Board member Melvin Willis, a community organizer with the Alliance of Californians for Community Empowerment, or ACCE, moved to adopt the resolution but said he wanted to go further, given what he had heard from tenants.

"The amount of basically disastrous maintenance issues I have heard left me very concerned," Willis said. "I did not know initially, when this regulation was adopted, that it prevented the petition process. I knew about other elements, but not about the petition process."

Willis said he wanted residents affected by exemptions to be able to file rent reduction petitions immediately. Oshinuga advised against that approach without first studying the issue, saying the board would need jurisdiction over the rent in question before a petition could proceed. Willis then moved to adopt the resolution as written, expressing a desire to see action items emerge quickly from the forthcoming study session.

Chair Tipton, who seconded the motion, said she wanted future presentations to address not only the impact of Regulation 202 but also its intent.

"We need to understand how it's actually playing out," Tipton said. "But also what it was meant to do. And is having these massive complexes submitting applications furthering that or not?"

A leadership transition

The vote came on the same evening that longtime Rent Program Executive Director Nicolas Traylor delivered his farewell message to the board as he prepared to retire after nearly nine years leading the agency.

"I leave proud of what we have built together," Traylor said, "an agency that both effectively and efficiently enforces The Fair Rent, Just Cause for Eviction and Homeowner Protection Ordinance."

The board had earlier voted in closed session to appoint Deputy Director Fred Tran as interim executive director while a permanent search is conducted.

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