The Mountain View City Council voted unanimously Tuesday to approve a new policy in which rent-controlled apartments that are demolished for redevelopment must be replaced with units affordable to low-income residents.

The move means that newly built housing replacing older, rent-controlled units won't be subject to the city's rent control law, but will instead be deed-restricted to be affordable for families making up to 80% of the area's median income. The benefit, according to city staff, is that the units would not make the jump to market-rate prices that normally comes with vacancy decontrol. With vacancy decontrol, once a rent-controlled unit becomes vacant, landlords may charge the next tenant market-rate rent.

The decision at the Sept. 13 meeting was narrow in scope. State law already requires developers to replace so-called "protected" units bulldozed during redevelopment with affordable housing, which includes deed-restricted units, rent-controlled apartments and units occupied by low-income families within the last five years.

Mountain View does have discretion, however, in deciding whether apartments subject to rent control but occupied by high-income earners should be replaced by either rent-controlled units or deed-restricted units, the latter locking in rents at a rate much lower than the average asking rent in the city.

City housing staff supported the deed-restricted approach, pointing out that newly built apartments subject to rent control can still be priced initially at market rate, which is likely to be "considerably higher" than what was charged before redevelopment.

Data collected by the city shows renting a two-bedroom apartment subject to rent control costs an average of $3,156 per month, whereas an unprotected unit would cost an average of $5,223. By comparison, an apartment subject to a deed restriction would cost $2,965.

Housing advocacy groups urged the council to adopt the policy as a means to preserve the city's shrinking affordable housing stock. Joan MacDonald, writing on behalf of Advocates for Affordable Housing, said the displacement of low-income residents and reversion of units to market rate means it's only a matter of time before the city loses its affordable units.

"We urge you to accept the staff recommendation to require new related affordable units to be deed restricted in perpetuity so that affordable housing is not lost," MacDonald wrote.

Members of the League of Women Voters of Los Altos and Mountain View also supported the policy, but worried that the city may not be doing enough to ensure low-income units are replaced appropriately under Senate Bill 330. For units in which the prior tenants' income is unknown, the state law requires Mountain View to do some digging using U.S. Housing and Urban Development (HUD) data to estimate the "likely income" of previous tenants. Kevin Ma, speaking on behalf of the league, said the data used to make those determinations is out of date and may not fully capture how many units were occupied by low-income renters.

City Council members swiftly supported the proposed policy with little deliberation, calling out the need to preserve affordable units.

"To have subsidized units in perpetuity that are income-qualified is very important to me, and so I think this is a good decision," said Council member Margaret Abe-Koga.