An amendment which would require landlords to pay Ellis Act evicted tenants in San Francisco a relocation payment of up to $50,000, an amount which would be calculated as the difference between the tenants’ current rent and the market-rate rent for a similar unit over the course of two years, has been passed by San Francisco’s Land Use and Transportation Committee and could be adopted by San Francisco’s Board of Supervisors next week.
The proposed amendment would require evicted tenants to submit a sworn statement of their intent to use the relocation payments solely for housing or other relocation costs, costs which have been defined as “rent payments for a replacement dwelling, the purchase price of a replacement dwelling, and cost[s] incurred by the tenant in moving to a replacement dwelling, or any cost[s] that were incurred to mitigate adverse impacts on the tenant of the eviction.”
And by capping the payment amount and defining its use, the Supervisors sponsoring the amendment (Campos, Kim, Avalos, and Mar) are confident the legislation will reverse a District Court’s ruling that deemed the existing, but currently unenforceable law, as unconstitutional.
From the Legislative Digest for the amendment to the Tenant Relocation Ordinance:
Landlords have sued the City (Levin v. City and County of San Francisco, (United States District Court, Northern District of California, 3:14-CV-03352-CRB, 2014)), seeking declaratory and injunctive relief from [the] current ordinance, which required each to make relocation payments they deemed excessive. Under the ordinance, the landlords were required to make relocation payments in excess of $100,000 per tenant. The Court determined that there was insufficient nexus between the landlords’ conduct and the harm to the tenants (that the landlord did not cause the high rental market in San Francisco), and that the payments were not roughly proportional to the harm because the plaintiffs were not required to spend the payments on costs related to the eviction. The Court enjoined the City from enforcing the ordinance. The City has appealed to the Ninth Circuit. The amendments to the legislation attempt to address the Court’s concerns.
Or as we wrote when the amendment was proposed: “By specifically focusing on relocation expenses, expenses which are currently capped at $15,795 per unit (plus $3,510 per disabled or elderly tenant) and haven’t escalated with the city’s rapid rise in rents, the newly drafted law to mitigate the adverse impacts of being displaced will be much more difficult to defeat if it’s adopted by San Francisco’s Board of Supervisors and the Mayor.”
While California’s Ellis Act allows landlords to withdraw their properties from the rental market, for whatever reason, it also provides local governments with the power “to mitigate any adverse impacts on persons displaced by reason of the withdrawal” (see paragraph above).