Planning Commission “Figures Out” that It Can Impose Interim Controls on Market Rate Housing Developments

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The “Mission Moratorium” failed to pass last month as an interim emergency ordinance and is headed to the ballot for November. However, it may have found new life in the meantime. The Planning Commission “figured out” that it can impose interim controls that would impose additional scrutiny on proposed developments – especially those that would demolish rent-controlled housing or community centers.

As for how to actually implement such a scheme, divorced from the emotion of the last effort, Commissioner Dennis Richards explained, “None of us are running for office or grandstanding… We can actually have a more rational discussion here”.

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Curbed SF Continues To Explore How You Probably Can’t Afford To Live Here

Curbed SF – faithful digester of Zillow housing data – determines that a household would need to earn $126,480 per year – or $63.24 per hour – to be able to live anywhere in the Bay Area. (That number is $175,760 per year, or $84.50 per hour, for San Francisco specifically.) That would be considered “unaffordable” by the common measure of spending more than 30% of income on household expenses.

Curbed notes that these numbers are based on median rental values, and low-income earners generally don’t rent at median rates an any city. That said, Curbed has previously noted that, even where the exact numbers that emerge from these kinds of data are not necessarily accurate, their changes over time are, and this represents an increase of roughly 15% since the end of last year for San Francisco. The good news? This picture presents an elegant solution: just earn more money.

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City May Subsidize Historic Local Businesses

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In another “first of its kind in the country” regulation of land use, Supervisor Campos has proposed a ballot measure to allow the City’s “legacy business fund” to support local small businesses distinguished by the Historic Preservation Commission.

The City’s contribution is in the form of a “grant” for older businesses up for lease renewals (of up to $22,500 per year), so it probably does not run afoul of California’s underdeveloped state-wide prohibition of commercial rent control.

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Disclosure of “Do Not Film” Documents

SocketSite reports on an ordinance unanimously passed by the Board of Supervisors that would require the transfer tax of real property to be recorded on the face of the instrument conveying it. This number is relevant because it can be used to calculate the sales price, and some buyers of high-priced real estate in San Francisco have been attempting to keep their purchase prices a secret.

Meanwhile, other San Francisco denizens might shout their ability to purchase property from their rooftop…

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City “Complying” with New Ellis Act Enhanced Relocation Assistance Law

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Under the new enhanced Ellis Act relocation assistance payment law passed by the Board of Supervisors last month, a landlord seeking to withdraw rental units from the rental market must pay up to $50,000, per rental unit, based on the “market rate differential” that the displaced tenant faces on the open rental market.

To determine this number, the new law requires the City Controller to provide market rate data for studios, one-bedrooms, two-bedrooms and three-bedroom apartments. This number, minus the tenant’s rent, times 24 months is the new “relocation payment”.

A previous attempt by the Board of Supervisors to require that landlord’s pay two years worth of rent subsidy was overturned last October in Levin v. CCSF. In an apparent effort to address the concerns of Judge Breyer, the Board of Supervisors capped the new relocation payment (which, under the previous version, could have easily been six-figures) at $50,000, and they require that a tenant provide their landlord with a signed declaration where they promise to use the funds for housing after they’re displaced.

The new law came online on June 14, 2015, and it required the Controller and the Rent Board to produce market data and the Declaration form, respectively, by June 19, 2015. While the Rent Board’s official position at the beginning of last week is that the City was not required to comply with the law, pending its appeal of Levin v. CCSF, it released this statement on Friday, in time to provide the necessary documents and data.

However, they are offered “for informational purposes only”. While there wasn’t a Schoolhouse Rock episode specifically about what happens when your city legislature passes a sequel to a law under review by the 9th Circuit, the subtext here seems to be that a landlord should comply anyway, unless and until the new law is also successfully challenged in the judicial branch.

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San Francisco To Close Group Housing Loophole

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Group housing developments have been on the rise in San Francisco lately. They provide two incentives for developers: smaller units mean more tenants/rental income and they have been exempt from San Francisco’s Inclusionary Housing Program, which requires developers to either pay money or create a specified number of below market rate units as a condition to creating the market-rate ones.

SocketSite reports that the City is now aiming to close that loophole. (At least one current developer of group housing units, Artthaus, says it would not be dissuaded from the business model as a result of an inclusionary housing requirement – and there seems to be a willingness to trade square footage for affordability, with a fair number of “Micro Units“.)

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San Francisco Landlord Sues City for Discrimination; Also, Is Being Sued by the City for Tenant Terrorism

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In what is sure to be a treasure trove of entertaining follow-up posts, the City of San Francisco recently filed a lawsuit against local landlord Anna Kihagi, for allgedly waging “a war of harassment, intimidation, and retaliation using unlawful, unfair and fraudulent practices” designed to force out long term tenants, “to make room for new tenants who pay market rent,” in defiance of “numerous state and local laws protecting these tenants and capping rents”

As has historically occurred in a soaring market, the number of fault-based evictions has skyrocketed in recent years, as the value of market rent exceeds legal transactional costs. And in contrast to landlords who at least operate under the pretext of grievous lease violations – like hanging laundry out to dry – Ms. Kihagi is accused of “interrupting mail service, interrupting gas, electric, water, and cable service, backdating correspondence and notices, failing and refusing to cash rent checks, falsely claiming that rent payments were untimely, violating tenant privacy, sending harassing text messages, abusing the landlord’s right of access by failing to give the required notice before entering, even yelling and screaming at tenants.”

Not to be outdone, Kihagi is suing the City for “targeting her in part because she is a female, African American immigrant who owns property”.

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