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The Oakland Community Land Trust website includes a 2018 video of a conference where the EBCLC (TOPA drafters in the East Bay) and Washington DC TOPA advocates discussed how to pass and administer TOPA in the Bay Area. The video includes some important statements and admissions about TOPA.

First, the primary differences between the DC TOPA program and the one being proposed here is that the DC program is not designed to preserve affordable housing. It is a "tenant empowerment" statute that can and often does result in properties being developed for market rate housing. One advocate even admitted that the term "tenant opportunity to purchase" is a misnomer because most DC tenants don’t want to buy the building - i.e. “it’s a dump.” She also admitted that the program often functions like a "tax" on the sale of the home when the owner has to buy out the tenant's TOPA rights. She said “There is no one way to do a TOPA deal”

Because of the large amount of federal and state funds available to fund TOPA purchases in DC, tenants "don’t have to put up any of their personal funds to exercise their TOPA rights.” The advocate said:

“It sounds very mystical and magical when we say you can buy your building and you don’t have to put a penny into it but it’s true." She presented a PowerPoint slide to illustrate this point that states that tenants must contribute time (clock and bullhorn graphics) but “no personal money”

The advocates also admitted and emphasized that TOPA dramatically extends the time it takes to sell a tenant occupied property, and this is a desired outcome for them. The time line from time of notice to when there is a new owner or conversion can take one to two years. She acknowledged property owners are upset by lengthy process but says that can’t be changed as TOPA processing “takes a lot of time”

The EBCLC advocates said that Bay Area TOPA will be different from DC in two primary ways:

(1) the sale price will be set by a city "trained" appraiser. One EBCLC staffer said that the reason this will be done is because the free market price would be too high and if the tenant or non-profit had to compete in a "free market" TOPA will be "futile." This video recorded admission is very important to our cause. Reducing the value of housing in the Bay Area is a fundamental goal of this legislation. The statute's use of the term "appraisal" is misleading because it implies that the "appraiser" will determine the fair market price. The intent of the drafters of the statute is to create a sham appraisal process to force owners to accept an artificially low price for the property.

A DC speaker warned that the DC statute had survived constitutional "taking"challenges largely because there were no price controls and the owner received a fair market price. The EBCLC speaker was not deterred by this warning. She said that her office was aware of this issue and was doing research to prepare for a legal challenge.

(2) The DC statute no longer regulates the sale of single family homes. The EBCLC speaker said it is necessary to control the sale of single family homes in the Bay Area because in some communities, single family homes make up a majority of the rental housing stock. Again, she was not deterred by the suggestion that controlling single family homes in the Bay Area with TOPA will be controversial.

In the final section of the presentation, the DC speakers admitted that one of the challenges of administering their program is that buildings with tenants who are paying artificially low rents can be impossible to adequately maintain without public subsidies. In other words, TOPA creates buildings that are ticking time bombs of deferred maintenance that will end up uninhabitable unless tax payers step in to fund the necessary repairs.

The speaker described TOPA properties that have significant repair cost but are occupied by long-term rent controlled tenants. She gave an example of a building where a long-term tenant is paying $400 a month for a two bedroom apartment but is making 80% of the areas median Income. She said "the challenge is to get that tenant to accept a rent increase" in order to be able to afford repairs to the building.

“Most of these properties need significant rehab”

She concluded that "It’s very difficult to operate very low income units without some kind of subsidy."

We may want to include in our messaging that TOPA will result in blighted and unsafe properties that must be eventually removed from the program or maintained at public expense.

You can see the entire video and a list of the speakers and their positions here:

https://oakclt.org/landhousingconvening/