LA County Board

20. Implementing Commercial Tenant Protections to Prevent Small Business Displacement and Deliver on Thriving Commercial Corridors Recommendation as submitted by Supervisors Mitchell and Solis: Direct the Director of Consumer and Business Affairs (DCBA), in collaboration with the Treasurer and Tax Collector, Department of Economic Opportunity (DEO), Chief Executive Officer (CEO) and County Counsel, to include a proposed design for a Los Angeles County Commercial Rental Property License (CRPL) to be provided 60 days after the submission of the CEO’s 90-day report in response to the June 16, 2026 motion by Supervisors Solis and Mitchell, “Providing the Best Starting Point for Business Owners in Los Angeles County,” which will include a draft model and recommendations for the Los Angeles County Business Licensing Program. The CRPL should require landlords in the unincorporated areas of Los Angeles County to obtain a CRPL as a condition of leasing commercial property. The proposed CRPL program design and implementation plan should include, at minimum, a proposed definition of Commercial Landlord; a proposed definition of Commercial Tenant for the purpose of the licensing requirements; and compliance and enforcement protocol in case of violations. The CRPL program design should also include recommendations for minimizing the pass-through of any fees onto business tenants to the extent legally feasible. The CRPL program should incorporate the feasibility of: Requiring license applications to disclose all pertinent information about the unit (such as landlord information, size, tenancy or vacancy status, rent amount, lease duration, length of tenancy, years of operation, use, etc.), together with any history of judgments or administrative findings relating to violations of tenant protection, health, safety, and building codes, anti-harassment or anti-discrimination laws, and any tax delinquency. All license holders shall be required to verify the above information annually. Including a record of all license information listed above, updated by CRPL licensees annually or within 30 days of a change in vacancy status. The record should be used by the maintaining County Department to, at minimum, connect commercial tenants and property owners with County resources and services, increase access to affordable commercial space, and prevent small business displacement. Providing that a CRPL may be suspended following a final court determination that the landlord violated Chapter 8.45 of Title 8 of the Los Angeles County Code (Commercial Tenant Anti-Harassment Ordinance); Including recommended compliance mechanisms, providing that during any period of a CRPL suspension, and to the maximum extent permitted by State law, including the Costa-Keene-Seymour Commercial Property Investment Act, the landlord shall be prohibited from increasing rent or filing a no-fault eviction until a violation is remedied or for a period of one year, whichever is longer, and structure this remedy so that suspension protects, rather than destabilizes, tenants in place. Recommendations should also include mechanisms for compliance in the case of a landlord failing to complete the annual information verification required by the CRPL; and Establishing a Special Status CRPL for landlords who commit to limiting rent increases to no more than three percent per year for 10 years, with Special Status license holders being eligible to participate in County procurement preference programs, tax incentives, and other County incentives for participating commercial landlords, to the extent permissible, and with Special Status disclosed to prospective tenants. Direct the Director of DEO, in collaboration with County Counsel, to prepare and return to the Board within 180 days, for introduction and adoption, an ordinance amending Chapter 8.45 of Title 8 of the Los Angeles County Code (Commercial Tenant Anti-Harassment Ordinance) to entitle any commercial tenant who relocates their business as a result of a violation of that Chapter to relocation assistance from their landlord, including: financial relocation assistance equal to the greater of three months of the tenant's gross receipts or three months of fair market rent for an equivalent location in the area, plus moving costs, along with recommendations for establishing a cap on relocation assistance. Direct the Director of DEO, using existing departmental resources, to conduct a commercial rent study within 120 days, and every three years thereafter, that calculates the price per square foot for one month of fair market rent for specified regions of the County, to support administration of the relocation assistance provisions described in Directive 2, and to survey small business renters to better inform the causes of their displacement. Direct County Counsel, in collaboration with the CEO, the Directors of DEO, Regional Planning, and Public Works, and any other relevant Departments, to report back to the Board in writing within 120 days with recommended ordinance language requiring commercial landlords to pay relocation assistance to commercial tenants displaced by redevelopment projects in the unincorporated areas. This relocation assistance shall be calculated the same way as in Directive 2. The report shall include: A recommendation for how to ensure that a commercial landlord has not violated the Commercial Tenant Anti-Harassment Ordinance, and, where a landlord has unaddressed violations thereof, actions that can be taken to protect current and future tenants. County Counsel shall consider the feasibility of requiring payments directly from the landlord when a commercial tenancy ends due to demolition or change of use, verifying that payment before the County issues demolition or building permits, and any other approach that achieves the same result.; and Where commercial tenants will be displaced by a proposed redevelopment project, the feasibility of a certification process similar to that required under Assembly Bill 2011 (Chapter 647, Statutes of 2022) and California Government Code Section 65912.123. This process would require an applicant to notify affected commercial tenants of the pending redevelopment application and imposition of appropriate relocation assistance to each commercial tenant who will be displaced, calculated in the same way as those who violate the Commercial Anti-Harassment Ordinance as outlined in Directive 2. The report should also determine an appropriate definition of what types of redevelopment opportunities would qualify for relocation expenses, with the intent of prioritizing small, legacy businesses. Unless otherwise ordered by the Board or required by law, waive the requirements of Board Policy No. 5.100 and authorize the Director of DCBA to prepare and execute agreements, and any amendments to existing agreements, approved as to form by County Counsel, with attorneys, consultants, non-profit organizations, or community-based organizations, to support the directives of this motion. (26-5180) Motion by Supervisors Mitchell and Solis (Updates Following Cluster) ADMINISTRATIVE MATTERS 21 - 92 Chief Executive Office