Ordinance 52-19 amends the Building Code’s previous abandoned building ordinance to extend its scope and accelerate its application.
Previously, the code defined a commercial storefront as “vacant or abandoned” if,
(1) it is unoccupied and unsecured;
(2) it is unoccupied and secured by boarding or other similar means;
(3) it is unoccupied and unsafe as defined in Section 102A of the Building Code;
(4) it is unoccupied and has multiple code violations; or
(5) it has been unoccupied for over 30 days.
Properties come outside of the definition of vacant or abandoned if the owner or lessee is actively seeking permits or authorization for a particular use, or if there is a permit for repair, rehabilitation, construction, etc. However, Ordinance 52-19 removes the existing exception where the property is being actively listed for lease or sale. It also requires payment of the registration fee upon registration (as opposed to the former rule: 270 days after it became vacant), and the owner must annually register and pay the fee.
The SF Examiner reports on the efforts of Supervisor Peskin to put a rental unit “vacancy tax” on this November’s ballot, for both residential and commercial properties. (San Francisco already requires registration and fees for vacant buildings.)
According to the Examiner, “Details are still being worked out, but the intent is to apply the tax to residential properties with three or more units. After six consecutive months of a vacancy, the property owner would pay $250 a day until the unit is leased”.
San Francisco’s ongoing efforts to create more housing has manifested in interesting ways over the years. Turning vacant units into residential rental units would obviously add to the rental housing supply. But whatever the actual language of the law, it is difficult to imagine that a special tax on those who refuse to enter the residential rental business is not a violation of the Ellis Act. (Buildings of this size would also need to register for the City’s gross receipts tax if they are used as rentals.)
San Francisco has passed Supervisor Fewer’s proposal to eliminate “debt servicing” passthroughs to tenant’s rental rates. In general, a landlord can only increase the rent for tenants in rent-controlled apartments by a limited amount (which, in San Francisco, is a 60% of the increase in the consumer price index, as published by the US Dept. of Labor, in the preceding year). As of this post, for instance, this “annual allowable increase” is 1.6% of the tenant’s “base rent”.
To avoid confiscatory results of price controls, however, the Rent Ordinance has allowed additional increases based on things like utilities, taxes, capital improvements and… debt servicing. However, Supervisor Fewer aimed to close a perceived loophole in this rule, where owners would load a property with debt for the specific purpose of increasing the rental rate.
Ordinance 132-18 amends Rent Ordinance Section 37.8 (“Arbitration of Rental Rate Adjustments”) to prohibit rent increases based on increased debt.
Supervisors Peskin and Fewer have introduced legislation for San Francisco to “support for full repeal of the Costa-Hawkins Rental Housing Act, which would enable policymakers across the State to confront the housing affordability crisis by expanding rent control, enacting and implementing vacancy control, and taking other critical steps to stabilize neighborhoods and communities across the State of California”.
Currently, local governments are permitted to set price controls for rent, with some exceptions for single family homes and condominiums, new construction, and most vacant rental units (unless a landlord has performed a “non-fault” eviction, like an Ellis Act withdrawal or owner move-in eviction). A repeal of Costa-Hawkins would remove those exceptions, allowing regulations like “vacancy control”.
The Costa-Hawkins repeal effort will appear on the November ballot as Proposition 10.
AB 2343 (2018), introduced by Assemblymember Chiu, seeks to significantly alter the the timing involved in unlawful detainer actions.
Unlawful detainers (often referred to as an “eviction lawsuit”) are unique among civil actions for their summary character. This is because, unlike other civil actions, they proceed on a five-day summons (instead of thirty), and most of their discovery and law & motion procedures are condensed as well. (Because of this, there have also been consequences for failure to “strictly comply” with the unlawful detainer statutes, in that a landlord must properly plead why she has standing for an unlawful detainer case (as opposed to, say, a breach of contract and ejectment lawsuit), as other causes of action and cross-complaints are generally not allowed. This also means that a landlord has served, e.g., a “three-day notice to cure or quit” that has expired prior to commencing the eviction lawsuit.
Continue reading Legislative Watch: AB 2343 (2018): Amendment to Unlawful Detainer Statutes To Extend Breach Cure Period and Tenants’ Time To Respond to Complaint