San Francisco Legislative Update (2019): Prohibition Against Tenant Harassment via Rent Increases


San Francisco has amended the Rent Ordinance to add to the definition of “tenant harassment” and “misdemeanors” certain rent increases “imposed in bad faith with an intent to defraud, intimidate, or coerce the tenant into vacating the rental unit” in circumvention of the just cause for eviction provisions. This will include circumstances where:
(1) the rent increase was substantially in excess of market rates for comparable units;
(2) the rent increase was within six months after an attempt to recover possession of the unit: and
(3) such other factors as a court or the Rent Board may deem relevant.

According to the Board of Supervisors, this legislation was prompted, in part, by specific cases in recent years with headline-grabbing rent increases. Whether justified by comparables or not, the tenants in those anecdotes chose to vacate, rather than pay the rent (although, at least one sued over the same theory that the City has now codified).

While the title and legislative findings of Ordinance 05-19 purport to extend these protections to tenants of single family homes and condominiums (which are commonly regulated by local eviction controls but which are exempt from rent controls under Costa-Hawkins), the sweeping new punishments apply to any circumstance where a tenant moves because of a rent increase (by any amount) and believes the landlord’s true motivations were to avoid a particular just cause.

These intentions may be noble, but they have some problems. For instance, the Superior Court ruling rejecting a tenant’s theory of an actionable increase found the conduct protected under Costa-Hawkins at the state level. It did not, for instance, find a failure of San Francisco to specifically regulate this issue.

In fact, the only class of housing stock referred to in the legislation is defined in Section 37.2(r)(7) – those that would be entirely covered by the Rent Ordinance but which are “partially or wholly exempted” because of Costa-Hawkins. It seems this regulation is destined to collide with a state law that occupies the field of vacancy decontrol.

As written, this would apparently even apply to annual allowable increases under the rent ordinance. (Although, as a practical matter, perhaps a landlord would have to impose several banked increases before the new rent is “substantially in excess” of those for comparable units.) Surely more updates to come. For now, the text of Ordinance 5-19 can be found here.