Mandatory Seismic Retrofit Work

San Francisco now mandates the retrofitting of buildings with “soft stories” to make them sound in the event of an earthquake. “Soft story” refers to the first floor of certain wood-frame buildings that are weaker and more flexible than the stories above. (Typically, these are floors with garages or open commercial spaces, and they are particularly vulnerable to severe damage and collapse.)

San Francisco saw significant damage to its housing inventory due to unsupported soft-story buildings during the 1989 Loma Prieta earthquake. The Dept. of Building Inspection estimates that soft stories were responsible for 7,700 of the 16,000 units rendered uninhabitable by Loma Prieta. Even following repairs, a significant portion of San Francisco structures exist on what would be considered vulnerable “liquefaction zones” by the U.S. Geological Survey.

To safeguard against this kind of destruction in the future, San Francisco adopted a voluntary compliance program in 2010 (Ordinance 54-10, signed into law by then Mayor Gavin Newsom). San Francisco adopted its current mandatory retrofit program (via Ordinance 66-13) to meet California’s goals of addressing soft story hazards by 2020, believing that “a resilient city is a city that can rebound from a natural disaster and quickly resume normal function”.

The Mandatory Seismic Retrofit Program:
San Francisco’s mandatory seismic retrofit program applies to 3+ story buildings with five or more dwelling units built before 1978. DBI has notified owners of buildings affected by the mandatory seismic retrofit program. These buildings fall within one of four “compliance tiers”, which set the dates of permitting and completion of work.

As San Francisco applies rent/eviction controls to all multi-unit buildings completed before June 13, 1979, seismic retrofit work on pre-1978 buildings will necessarily engage rent and eviction control regulations in one of two ways:

First, where landlords are required to terminate entire tenancies in order to perform seismic retrofit work, they may temporarily terminate these tenancies under one of the Rent Ordinance’s “just causes” for eviction for temporary capital improvement work. Second, where the landlord only needs access to garage/storage areas, they will need to temporarily sever any affected “housing services” connected with the rental unit.

Terminating the Tenancy:
Rent Board Rule 12.15 allows temporary capital improvement (TCI) evictions, where the work would make the rental unit hazardous, unhealthy and/or uninhabitable during the work. If the seismic retrofit work will disrupt the use of a rental unit to this level, then the landlord will need to terminate the tenancy before commencing work.

To perform a TCI eviction, the landlord will first need to obtain permits for the seismic retrofit work. If the work will take longer than 3 months, the landlord must also first file a petition with the Rent Board (Form 535) for an extension of time to complete capital improvements. The landlord then must serve a notice of termination of tenancy (usually a 60-day notice), and if the tenant does not vacate, the landlord must evict them.

As this is a temporary termination of tenancy, Rent Board Rule 12.16 provides for a statutory “right to reoccupy”, where a landlord must provide written notice of the tenant’s ability to reoccupy the rental unit upon completion of repairs. Interestingly, case law provides that this right to reoccupy actually survives an eviction, in the event where a tenant does not timely vacate. (Chacon v. Litke (2010) 181 Cal. App. 4th 1234.)

A landlord is required to pay relocation assistance to tenants displaced for TCI work. Like other non-fault evictions, a landlord will have to pay an inflation-adjusted sum (of roughly $6,000 per tenant, with an additional $4,000 per disabled, elderly tenant or household with a child). Or, for work that will require less than 20 days of displacement, the landlord must pay an inflation adjusted per diem rate (currently $341.00/day as of this post).

Temporary Severance of Housing Services:
Where a landlord merely needs to recover space in the soft story in order to install the retrofitting apparatus, they need not necessarily terminate any tenancy. Instead, they will need to temporarily sever “housing services” in order to take possession of the affected portion of the building.

While “severing” housing services generally requires just cause, the mandatory seismic retrofit ordinance permits temporary severance in order to complete this work. As with terminating the tenancy for TCI evictions, the landlord will need to obtain permits in advance. Then, the landlord can provide a 30-day notice that changes the terms of the tenancy to temporarily exclude the specified housing service and provides information on the length of time the housing service will be severed. As this is not a “termination of tenancy”, it is limited by the timeframe for completing permits, rather than the three-month limit for TCI evictions. Nonetheless, the housing services may only be severed for the minimum time required to complete the mandatory seismic work.

In addition, the landlord must either provide compensation or substitute housing services. “Compensation” can be based on an agreed-upon rate stated in the lease or other written agreement or an estimated replacement value, not to exceed 15% of the per diem rental rate. Substitute housing services are those that are “reasonably near” the building and like in kind.

While the temporary severance of housing services do not constitute a termination of tenancy (i.e., a landlord cannot evict for failure of a tenant to vacate by the expiration of a termination notice), the do appear to constitute an authorized “change to the terms of a tenancy”, which would support a three day notice to cure or quit, in the event that the tenant does not comply with the severance of the housing services.

If we can be of assistance with any of your seismic retrofit needs, please call 415.956.8100 or email Justin A. Goodman at justin@zfplaw.com to ask about a consultation.

Residential Rent and Eviction Control Resources