San Francisco Expected To Pass Second Attempt at Enhanced Relocation Payments for Ellis Act Evictions

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The Board of Supervisor’s Land Use and Transportation Committee passed a revised version of last year’s “Campos Amendment” to the Ellis Act on a first reading last week. The Campos Amendment provided for enhanced relocation assistance payments based on the difference between rent controlled and market rental rates, for two years. First the federal district court in Levin v. CCSF and then the Superior Court in Jacoby v. CCSF found that payment metric unconstitutional, for lacking both an “essential nexus” with and a “rough proportionality” to a landlord’s act of withdrawing units from the rental market.

The proposed legislation responds directly to the criticisms laid out in these rulings. Its much less ambitious relocation payments are capped at $50,000.00 per unit, and the enhanced relocation payments are not required until a tenant returns a signed Declaration, stating that they will use the money for relocation costs. That said, the Declaration is now made a prerequisite to terminating tenancies under the Ellis Act, which may raise preemption concerns. And the enforcement mechanism contemplated by the proposed legislation requires a tenant to keep track of expenditures so that their former landlord can request and verify that they’ve used the money for housing, which may raise privacy concerns.

The proposed legislation is expected to pass on its second reading this Tuesday, before the Board of Supervisors sends it to the Mayor.

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Rent Board Publishes Annual Report on Eviction Notices

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The San Francisco Rent Board recently prepared its Annual Report on Eviction Notices for the San Francisco Board of Supervisors, detailing the number of eviction notices filed with the Rent Board from March 1, 2014 to February 28, 2015, indexed by the “just cause” used by the landlord.

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The biggest change is a 117% increase in termination notices based on “illegal use of rental unit”. There was also a 48% drop in Ellis Act termination notices. Note: the San Francisco Rent Ordinance does not require landlords to file “non-payment of rent” notices with the Rent Board. While 145 notices were filed anyway, this is not believed to accurately reflect the number of notices for this period.

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San Francisco Buyout Agreement Legislation Now Effective

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San Francisco’s new tenancy buyout legislation became effective today. The Rent Ordinance now requires that landlords provide a disclosure form to tenants prior to opening buyout negotiations with them. (Landlords must retain a copy of the signed disclosure forms for five years.)

Landlords must also file a declaration form with the Rent Board, stating that they’ve provided tenants with the required disclosures prior to commencing buyout negotiations.

“Buyout Negotiations” are broadly defined as “any discussion or bargaining, whether oral or written, between a landlord and tenant regarding the possibility of entering into a Buyout Agreement”, with “Buyout Agreement” defined as “an agreement wherein the landlord pays the tenant money or other consideration to vacate the rental unit”.

Landlords are also required to file the executed Buyout Agreement with the Rent Board, which has begun keeping records of these agreements and will be providing access to a searchable database of buyout values by neighborhood. The Rent Ordinance now provides specific requirements for what must be in a Buyout Agreement and imposes two important deadlines: a tenant may rescind the Buyout Agreement for up to 45 days from execution, and the landlord must file the Buyout Agreement with the Rent Board within two weeks after it becomes binding.

The Rent Ordinance also provides for civil penalties for non-compliance (including for failing to include all required information in the Buyout Agreement). And, the execution of Buyout Agreements will now restrict the ability to convert buildings into condominiums for up to ten years, in a manner similar to the existing restrictions based on a landlord’s use of “non-fault” evictions (i.e., the City won’t sell residential condominium conversion lottery tickets, won’t accept residential condominium conversion subdivision application forms and won’t accept a tentative or final subdivision or parcel map, if the landlord entered either two Buyout Agreements or entered one Buyout Agreement with an elderly, disabled or catastrophically ill tenant in a single building.)

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New Rate for Interest on Security Deposits in San Francisco, Effective March 1, 2015

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Beginning March 1, 2015, the new rate for interest on security deposits is 0.1%, for the period of March 1, 2015 to February 29, 2016.

Security deposit interest must be paid every year on the tenant’s “annual due date”. For tenancies beginning after September 1, 1983, the annual due date is the same day and month the landlord received the deposit from the tenant. If the tenant moved in and paid a deposit before September 1, 1983, interest was due on September 1, 1984 and every September 1st thereafter.

For more information, please visit the Rent Board website.

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New Allowable Rent Increase for San Francisco, Effective March 1, 2015

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The new allowable rent increase rate for San Francisco rent controlled tenancies goes into effect on March 1, 2015. For rent increases between March 1, 2015 and February 29, 2016, the allowable increase is 1.9%.

For additional information, please visit the Rent Board website:
A landlord may increase the tenant’s base rent once every 12 months by the amount of the allowable annual rent increase without filing a petition at the Rent Board.

Effective March 1, 2015 through February 29, 2016, the allowable annual increase amount is 1.9%.

This amount is based on 60% of the increase in the Consumer Price Index for All Urban Consumers in the Bay Area, which was 3.2% as posted in November 2014 by the Bureau of Labor Statistics.

To calculate the dollar amount of the 1.9% annual rent increase, multiply the tenant’s base rent by .019. For example, if the tenant’s base rent is $1,500.00, the annual increase would be calculated as follows: $1,500.00 x .019 = $28.50. The tenant’s new base rent would be $1,528.50 ($1,500.00 + $28.50).

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San Francisco Legislative Update for 2015: Campos Amendment relocation assistance on Ellis Act Evictions

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Ordinance 54-14 amended the Rent Ordinance to increase relocation assistance to two years worth of rent payment differential between the existing unit and a comparable unit. At the moment, this has been found unconstitutional (see, Jacoby, et al. v. CCSF, San Francisco Superior Court Case No. CGC-14-540709, and Levin v. CCSF, Federal District Court case no. 3:14-cv-03352), but the City is appealing the decision. Keep checking Costa-Hawkins.com for updates.

Legislative language available here.

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San Francisco Legislative Update for 2015: Temporary Tenant Household Dislocation Compensation

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Ordinance 44-14 became effective on May 18, 2014, and it was enacted to bring the Rent Ordinance into compliance with California Civil Code, section 1947.9 (January 1, 2013,), which limits relocation assistance payable for temporary evictions where the landlord carries out capital improvements or rehabilitation work.

Section 1947.9 limits the compensation that a landlord would otherwise have to pay to tenants (under section 37.9C) for displacements of twenty days or less to $275 per day and actual moving expenses. Or, in lieu of payment, the landlord can provide a “comparable dwelling unit”.

Legislative language available here.

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San Francisco Legislative Update for 2015: “Hearings on Alleged Wrongful Endeavor to Recover Possession Through Tenant Harassment”

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Ordinance 1-14 became effective in February 13, 2014. It added subsection 37.9(a)(l) to the San Francisco Rent Ordinance, and it creates a procedure where tenants can file a report with the Rent Board based on alleged tenant harassment (within the meaning of section 37.10B). Then the Rent Board can set a hearing, take evidence and either file a civil action or refer it to the DA for prosecution.

Legislative language available here.

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